PURSATTAMDAS GUJRATI Vs. LALA BAIJNATH PROSAD

JUDGEMENT

(1.) This is an application on the part of Lala Banshilal, one of the judgment-debtors, that an order dated 14 September 1939 in so far as it directs an attachment of the right, title and interest of certain persons in the firm of Kashi Prosad & Co., Managing Agents of the Ratna Sugar Mills Co. Ltd., and the appointment of a receiver of all moneys payable to the defendants in that firm by the Sugar Mills, be declared void. It is conceded that the attachment of the right, title and interest of these persons in the managing agents firm must be set aside, but it has been argued that the appointment of a receiver in execution was a proper appointment and should continue. The learned Advocate-General on behalf of the applicants has argued that there is no necessity for the appointment of a receiver in execution, and he has referred me to several decisions, notably the decision in Holmes v. Millage (1893) 1 QB 551 where at p. 558 Lindley L. J., refers to the circumstances in which a receiver should be appointed in execution in England both before and after the Judicature Act. The learned Lord Justice points out that the appointment of a receiver is a serious interference with business, and says: We cannot judicially hold the appointment of a receiver in a case in which no Court could grant a receiver before the Judicature Act to be just or convenient within the true meaning of Section 25, Clause 8 of that Act.

(2.) Rankin C. J., in Promothanath Malia Vs. H.V. Low & Co has drawn attention to the difference between the appointment of a receiver in execution in England and a similar appointment in India. "What a creditor gets by the appointment of a receiver," says the learned Chief Justice, is not execution, but a substitute for execution : a form of equitable relief which is granted on the ground that there is no effective remedy by execution at law. Accordingly, there is authority for the proposition that a person seeking equitable execution must show that he was met by difficulties arising from the nature of the property, which prevented his obtaining relief at law. In India, the distinction between legal and equitable interests is not observed in the full sense in which it is part of the law in England.

(3.) The learned Chief Justice then points out that in Section 51, Civil P.C., 1908, provision has been made for the appointment of a receiver as a form of execution. The question, in my opinion, to be decided is whether there were circumstances in the particular case under consideration that justified the appointment of a receiver as a method of execution, bearing in mind that the distinction between legal and equitable interests in India is not observed in the same measure as it is in England, and that Section 51, Civil P. C, specifically provides for the appointment of a receiver as a method of execution, without in any way distinguishing it from methods of execution known to the English Common law. The facts here are that the plaintiffs obtained a decree on 4 May 1939 for over Rs. 46,000. The defendants have a joint family business which has a number of branches controlled by separate groups of the joint family. One of those groups is in Calcutta, another in Benares and another in Allahabad. A partition suit has been going on amongst the defendants in the Allahabad Court. The shares of the parties were declared and allotments made, but an appeal is pending from the partition decree, and it is impossible to state at any precise moment the properties which definitely come within the shares of any particular member of the family. Within one month of the decree which the applicants obtained in this suit a fresh suit was filed by certain minor members of the family against the present applicants and other decree -holders for a perpetual injunction restraning them from executing their decrees against the properties of the plaintiffs.