JUDGMENT

Mootham, J. - This case raises two questions of importance, first, whether this Court has power under O. 40, Civil P.C. to appoint a receiver of property the subject of a simple mortgage and, secondly, if it has that power, whether the appointment should be made where the principal ground upon which it is sought is the non-payment of interest by the mortgagor.

2. The facts can be briefly stated. On 3rd July 1934, Babu Panchanan Banerji, who has since died and is represented by the appellants, borrowed the sum of Rs. 8,00,000 from the Maharaja of Sonepur, and as security for the loan and for the interest payable thereon he executed a simple mortgage of property situate in Bengal and the United Provinces. It was agreed that the loan should bear interest at the rate of sis per cent, per annum payable half yearly for two years and thereafter at seven per cent, payable annually. At the time the loan was taken Babu Panchanan Banerji's property was under the management of the Court of Wards and the deed of mortgage was accordingly executed by the Special Manager, of the Court of Wards of Bengal. In 1938 Babu Panchanan Banerji died, and three years later the mortgaged properties were released from the management of the Court of Wards. Interest on the loan appears to have been paid until the year 1940, but thereafter it fell into arrears and on 3rd September 1941, the Maharaja of Sonepur instituted a suit in the Court of the Civil Judge of Benares for the sale of the mortgaged property. The suit was contested by the defendants, who not only contended that the Special Manager had no authority to execute a mortgage and that there was no legal necessity for the loan, but that no mortgage was in fact executed and, indeed, that no loan was ever taken. The learned Civil Judge rejected the various pleas in defence except one. He was of opinion that the Special Manager had no authority to mortgage the United Provinces property, and on 28th May 1943 when he passed a preliminary mortgage decree for the full amount claimed he accordingly declared that the mortgaged property was limited to that situated in Bengal. From this decree both parties have appealed.

3. In the year 1936 the question whether a Court was competent to appoint a receiver of a property the subject of a simple mortgage pending the decision of an appeal from a preliminary mortgage decree was considered by a Full Bench of this Court in Anandi Lal and Others Vs. Ram Sarup and Others, AIR 1936 All 495 The argument before the Court, and the answers given to the questions propounded, turned, wholly upon the construction of sub-r. (2) of R. 1 of O. 40, Civil P.C. That sub-rule then read as follows:

Nothing in this rule shall authorize the Court to remove from the possession or custody of property any person whom any party to the suit has not a present right so to remove.

and the Pull Bench was unanimously of opinion that the words "any person" in the sub-rule included all persons whether parties to the suit or not. Taking this view Sir Shah Sulaiman C.J. answered the question referred to the Bench by saying:

My answer to the question referred to us, therefore, is that though there is no objection to the mere appointment of a receiver of any property, the Court cannot remove from the possession or custody of the property any person, whether a party to the suit or not, whom any party to the suit has not a present right so to remove.

Thorn J., as he then was, concurred in the answer given by the Chief Justice and Rachhpal Singh J. was of opinion that no receiver could be appointed unless the party applying for the appointment could establish that he had a present right to remove the opposite party from the possession and custody of the mortgaged property. Observations made by the learned Judges constituting the Bench as to the propriety of a receiver being appointed at the instance of a simple mortgagee were, in these circumstances, obiter. Doubt having arisen as to whether the constru