UNION OF INDIA Vs. OFFICIAL ASSIGNEE OF BOMBAY

JUDGEMENT

(1.) A rather interesting question arises in this appeal as to the scope and extent of a solicitor's right to his costs and expenses in an administration suit against a rival claim of the State in respect of income -tax dues.

(2.) ON February '24, 1944 Bhagoji Baloji Keer died leaving income -tax liability of approximately Rs. 90,000. He was joint with his wife and two sons respondent No. 5 Anant and one Bhalchandra who subsequently died and whose son, daughters and wife are respondents Nos. 3, 4, 8, and 1 respectively. During his lifetime Bhalchandra was adjudicated an insolvent and his property vested in the Official Assignee, respondent No. 1, on May 21, 194G. In order to separate his share in the joint family property the Official Assignee instituted a suit for the administration of the property of Bhagoji on the Original Side of this Court, suit No. 807 of 1947. The suit was referred to the Commissioner for Taking Accounts on April 12,1948 for the purpose of administration of the property. An. amount of Rs. 1,17,429.82 recovered by the Commissioner was held by him on account in the suit and on February 27, 1961 all the parties to the administration suit other than the plaintiff through their respective attorneys took a consent order from Mr. Justice S. M. Shah in respect of that amount. The substance of that order was that after the payment of certain specific sums to the several defendants in the suit the learned Judge ordered that the Commissioner for Taking Accounts should pay 'the taxed costs of this suit incurred after 13th October 1950 including the costs of the reference and the sale before the said Commissioner for Taking Accounts and the proceedings before the arbitrator, Town Planning Scheme and the meetings held before the Court Receiver, High Court, Bombay and the Charity Commissioner as between 'attorney and client' to the plaintiff and to the 1st, 2nd and 3rd defendants and to the 4th, 5th, 7th and 8th defendants upon the passing of the order on the said chamber summons'. He also passed further orders as regards the payment of the taxed costs of the attorneys in suit No. 3882 of 1947 and No. 3662 of 1947 which were suits in respect of specific items of property separately litigated. The above orders so far as the payment to all the attorneys except to those of the plaintiff, were made upon consent of the parties. So far as the costs payable to the plaintiff were concerned, the order was in invitum.

(3.) IN the meanwhile the Income Tax Officer, Companies Circle I (1) of Bombay put in his claim with the Official Assignee in respect of the amount of income -tax owed by the estate of Bhagoji Keer amounting to Rs. 90,520.92. A chamber summons was taken out on October 11, 1963 on behalf of the Union of India for an order that the entire amount of Rs. 61,571.00 N.P. be paid to the Union and the balance left over be paid to them after the sale of other properties of Bhagoji Keer. If the entire amount of the balance in the hands of the Official Assignee namely of Rs. 61,571.60 was paid towards that claim, it would for the time being leave nothing for payment to the respective attorneys of the parties under the order of Mr. Justice Shah dated February 27, 1961,