DAVID ELIAS DUEK COHEN Vs. BAIDYANATH MUKERJI

JUDGEMENT

(1.) In this appeal, which has been preferred by the mortgagor, the legality of the appointment of a receiver by the mortgagee is in question. The Court of first instance declared the said appointment illegal, and restrained the person so appointed from taking possession of the mortgaged premises and from realising rent from the tenants in possession. The learned District Judge has however held otherwise and has dismissed the appellant's suit. Premises No. 57 (formerly No. 28) Ballyganj Circular Road, which comprised an area of 10 bighas 10 cottas 13 chittaks with buildings originally belonged to Miss Mary Jones. She had mortgaged the same to the Administrator-General of Bengal, who is the executor to the estate of Sagore Dutt, deceased. She sold the said premises, subject to the said mortgage to the appellant. The appellant executed on 27 July 1928 a mortgage in favour of her of the said premises for a sum of Rupees one lac. One of the clauses of the mortgage bond, the terms and conditions of which will have to be examined hereafter in detail, is that the mortgagor will have the right to dispose of any portion of the mortgaged premises and the mortgagee will have to realise and reconvey the said portion to the mortgagor or his nominee, provided that the price received for the same, less brokerage, was paid to the mortgagee.

(2.) In pursuance of this right reserved to the mortgagor, the appellant has sold about 7 bighas 2 cottas odd land out of the mortgaged premises, and the remaining area of about 3 bighas 8 cottas odd land together with the building standing thereon is still subject to the mortgage. Interest being admittedly in arrears for over six months Mr. Deveria, acting on behalf of Miss Jones, and acting under a power of attorney executed by her on 12 February 1926, appointed, under the provisions of Section 12, Trustees and Mortgagees Powers Act, respondent 1, Mr. Baidyanath Mukerji, a pleader of Alipur, receiver on 16 June 1933. This gentleman having attempted to realise rent from the tenants occupying the mortgaged premises, the mortgagor, namely the appellant, brought the suit out of which this appeal arises, for a declaration that the said appointment was illegal, and from restraining Mr. Mukerji, from taking possession of the mortgaged premises or from realising rent or from disturbing the appellant's possession. The appellant's Counsel has presented his case before me on the following grounds: (i) As the mortgage is not an English mortgage, the appointment of Mr. Mukerji by the mortgagee as receiver is invalid. (ii) Even if the mortgage is an English mortgage, the Court only can appoint a receiver, Section 69-A added to the Transfer of Property Act, by Act 20 of 1929, having abrogated Section 12, Trustees and Mortgagees Powers Act. (iii) The appointment of a receiver could not be made at the time at which it was not made according to the terms of the mortgage instrument as the mortgage money had not at that time become due and payable. (iv) At any rate the mandatory provisions of Section 12, Trustees and Mortgagees Powers Act, have not been complied with, as Mr. Mukerji, was nominated receiver by Mr. Deveria, before the expiry of ten days from the time when the letter written by the latter asking the appellant to nominate a receiver reached him. And (v) Mr. Deveria had no power under the terms of his power of attorney to appoint the receiver.

(3.) Besides meeting the points raised by the appellant's Counsel Dr. Mukerji, appearing on behalf of respondent l, has raised a further point. He says that even if the mortgage be not an English mortgage, it is undoubtedly an anomalous mortgage, and according to the provisions of Section 98, T. P. Act, the rights and liabilities of the mortgagor and mortgagee must be determined in accordance with their contract. He further contends that by the contract the mortgagee has been given the power to appoint a receiver in accordance with the provisions of the Trustees and Mortgagees Powers Act In the view I am taking of the first point raised by Mr. Carden Noad it is necessary to deal with this further point raised by Dr. Mukerji, although I must admit that there is great force in his argument. In order to decide the first point it is necessary to recite the main terms of the mortgage instrument.