RAM CHANDRA BANERJEE Vs. BAIDYANATH ROY CHAUDHURY

JUDGEMENT

(1.) The Madhabpashwa estate of which the respondents are the proprietors was involved in debts. One of their creditors, a mortgagee, had instituted in 1927 a suit against them to recover his dues which was a heavy one (Suit No. 40 of 1927 of the first Court of the Subordinate Judge, Barisal). Two other creditors had started two execution proceedings (Nos. 4 and 10 of 1927) in that Court. In that suit and in those execution proceedings the appellant, a retired judicial officer, was appointed receiver on 3 September 1927, on his furnishing security for Rs. 10,000 and on executing a security bond. The Court of Wards assumed charge of the Madhabpashwa estate in the early part of 1929 and the appellant was discharged from his office as receiver on 20 January 1929. He submitted his accounts to the Court which had appointed him, but instead of directing a ministerial officer of the Court to check his accounts the learned Subordinate Judge appointed the manager of the Court of Wards to check the same and directed him to report. The said officer submitted two reports - one on 7 February and the other on 2 May, 1930. The said reports came up for consideration on 5 January 1931. By an order made on that date the learned Subordinate Judge following the rule of practice indicated in Coomar Sattya Sankar Ghosal V/s. Rani Golapmoni Debi ( 01) 5 C.W.N. 23 held that all the matters dealt with in those two reports could not be properly dealt with in proceedings arising out of exceptions to a receiver's accounts. He accordingly dealt with some of the matters referred to in the reports and some of the objections of the proprietors of the Madbabpashwa estate to the receiver's account and gave the latter leave to sue the receiver in respect of other matters which concerned the management of the estate by the said receiver. The receiver was finally discharged by an order dated 21 January 1932, which, however, expressly reserved the right of the Court of Wards and the proprietors of the Madhabpashwa estate "to establish any claim they may make against him in a suit properly framed for the purpose."

(2.) On 28 November 1931, the manager of the Court of Wards acting on behalf of the proprietors gave a notice under Section 80, Civil P.C, to the appellant, and on 21 March 1932, instituted this suit against him. In the suit the appellant is sought to be made liable for his negligence in the management of the estate which had been committed to him as receiver. In the plaint the details of the claim have been set out in two schedules B and C. The substance of the charge against him is that he negligently allowed rents due from the tenants to be barred by time, that he made large advances to his subordinate officers and failed to recover them, that he paid money without the sanction of the Court and that he allowed the teshildars to incur expenditure not sanctioned by the Court and which the Court ultimately refused to sanction. The learned Subordinate Judge in his preliminary judgment dated 30th September 1937 found that the appellant was "guilty of wilful neglect and gross negligence in managing the estate." He held the receiver liable to render account of his management from 3 September 1927 to 19 January 1929, that is to say, for the period during which he had acted as receiver. This appeal is directed against that decree. While this appeal was pending the final decree was passed on the basis of the Commissioner's report by which the appellant has been directed to pay the respondents the sum of Rs. 5168-11-6 and costs. The appellant does not challenge the Commissioner's report or the correctness of the amount mentioned in the final decree. Nor does he challenge the finding against him in the preliminary decree to the effect that he had been guilty of wilful neglect and gross negligence in the management of the estate. The only point raised by his advocate is the question of limitation. On that question the learned Subordinate Judge held that Art. 120, Limitation Act, was applicable and so the suit was in time.

(3.) In our judgment neither Section 10 nor Art. 89, Limitation Act, is applicable to this suit. The estate does not vest in a receiver appointed under the provisions of Order 40, Civil P.C. While functioning he is not a trustee, much less a trustee for a specific purpose. His position is that of an officer of the Court appointing him and his official duty is to preserve and manage the subject-matter of the litigation. He is not the agent of the parties to the litigation in which he is appointed or of any one of them. He acts for the benefit of the party who "ultimately becomes successful. The property is in custodia legis and through him the Court discharges its functions of preserving the subject-matter of the litigation. He is only accountable to the Court, which appointed him in his capacity as its officer. The right to take account from him or to take account of his management is primarily in the Court which appointed him and the right of an individual to sue him for accounts or in matters respecting his management is a right derived from the Court by reason of the leave given to him by the Court to sue. The real competition is between Art. 36 and Art. 120, Limitation Act. If the case comes within Art. 36, Art. 120 cannot apply.