COLLECTOR OF TIRUCHIRAPALLI Vs. TRINITY BANK LIMITED

JUDGEMENT

(1.) O. S. No. 268 of 1953 on the file of the Sub Court, Tiruchirapalli, was a suit on a mortgage dated 30-10-1946, in which a preliminary decree was passed on 9-12-1946. The decree-holder applied for the appointment of a Receiver in I. A. No. 12 of 1955 in respect of the mortgaged property to collect the rents and profits therefrom. By order of court dated 8-2-1955 a Receiver was appointed. The judgment debtor in that suit was assessed to income-tax for the year 1955-56.

(2.) IN O. S. No. 76 of 1948 on the file of the Sub Court, Tirunelveli, a decree in terms of a razinama entered into between the parties to the suit was passed on 18-4-1952. The third defendant in that suit was Rao Bahadur P. Muthuswami Reddiar. It is not necessary to refer to the nature of the suit or the f reliefs prayed for therein, or to all the terms of the compromise between the parties. It is sufficient to refer to the following clauses in the compromise decree :

(3.) THIS rule may be said to be the outcome of the maxim "salus populi suprema lex"; (Regard for the public welfare is the highest law). It is but natural that a debt due to the Crown, as representing the public at large, should be preferred to the debt of a single creditor. But this rule of priority in favour of the Crown for the realisation of its dues can only prevail and be enforceable as between unsecured creditors of equal degree, there being no question of any lien, charge, or mortgage in favour of one other of such creditors. The priority of the Crown cannot rank as against a secured creditor so as to deprive him of his security or to affect or injure his rights as such secured creditor.