JEKISONDAS MAGANLAL Vs. NANABHAI JHINABHAI

JUDGEMENT

(1.) By consent order dated September 30, 1947, one Mohanlal Nathubhai was appointed. Receiver (without remuneration and without security) in suit No. 1890 of 1947 to take charge of all assets, out standings, all the books of account, papers, vouchers and furniture of the firm of R. Ramanlal with powers under Order XL, Rule 1 of the Civil Procedure Code, as also with power to pay the debts of that firm, and to engage employees. The Receiver so appointed entered into the management and collected the outstanding and paid debts due by the firm. It appears that the Receiver settled and adjusted some of the claims of the firm against the debtors of the firm and paid other persons who made claims against the firm as creditors. The Receiver thereafter filed his accounts before the Commissioner for Taking Accounts. The plaintiffs in the suit objected to the form in which the accounts were filed. The Commissioner for Taking Accounts thereupon directed the Receiver to file revised accounts, and the same were accordingly filed. The plaintiffs filed objections and surcharges to the revised accounts. After some discussion before the Commissioner some evidence was led by the Receiver and the plaintiffs. The Receiver then raised two preliminary objections: (1) that it was outside the province of the Commissioner to consider the validity of the debts discharged by the Receiver, and that it was solely within the province of the Receiver to satisfy himself that debts were due, and that he was entitled to make payments accordingly, and

(2.) that it was not open to the plaintiffs to file objections and surcharges to the Receiver's accounts, as it was still to be decided whether the plaintiffs were interested in the firm of R. Ramanlal as partners. The Commissioner for Taking Accounts by an order dated June 19, 1951, disallowed both the objections, and directed the Receiver So proceed with the Anr. vs. Nanabhai Jhinabhai (10.08.1951 -BOMHC) Page 3 of 9 evidence relating to the proof of his accounts. The Receiver thereupon requested the Commissioner to make a special report to obtain directions from the Court on the following points: (1) whether in view of the order dated September 30, 1947, it is within the province of the Commissioner to go into the question of the existence of debts of the firm of R. Ramanlal shown in the accounts as paid by the Receiver, and (2) whether the plaintiffs were entitled to file any objections and surcharges to the accounts filed by the Receiver. It is this special report of the Commissioner dated July 12, 1951, that comes for adjudication before me on the Receiver's notice of motion dated July 27, 1951.

(3.) Mr. Seervai on behalf of the Receiver has submitted that a Receiver under the rules of this Court is required to have his accounts passed, and for that purpose the Receiver has to file his accounts in form No. 144 printed at page 332 of the Rules and Forms of the Bombay High Court (on the Original Side). 1950, before the Commissioner for Taking Accounts, and if the Receiver files accounts in that form and produces proper vouchers, prima facie showing that certain payments were made to the creditors oi the estate of which he has been appointed Receiver, it is not open to the Commissioner to enter upon an enquiry whether the debts were as a matter of fact due. According to Mr. Seervai, the Commissioner has merely to see whether the payments alleged to be made are supported by proper vouchers or other evidence, and once that is done, it is not open to the Commissioner to enquire whether the debts satisfied by the Receiver did in fact exist, nor is it open to him to enter upon an enquiry as to the surcharges or as to any loss occasioned to the estate by any act of the Receiver.