DARBAR PATIALA Vs. FIRM NARAIN DAS GULAB SINGH

JUDGEMENT

(1.) These are two appeals under Section 45, U.P. Encumbered Estates-Act. Each arises out of a stay order which, has been passed by the Special Judge of Saharanpur. The Jagadhari Estate, i.e. the respondent to these appeals, was under the Court of Wards, but it has now been released. The owners of the estate traded in the name of Narain Das Gulab Singh. The Patiala Darbar obtained a money decree against the respondent at Ambala, and a similar decree was obtained there by the Punjab National Bank. The Jagadhari Estate has property in the United Provinces as well as in the Punjab. Each of the two aforesaid decree, holders put his decree into execution against immovable property belonging to the respondent in the Punjab. While these decrees were under execution, the respondent presented an application-before the Collector of Saharanpur under Section 4, U.P. Encumbered Estates Act, and in due course that application was sent, under Section 6 of the Act, to the Special Judge. Thereafter the respondent applied for stay of proceedings at Ambala, and the Special Judge has issued a stay order in each case. One order is dated 15 November 1935 and the other is dated 19th March 1936. The judge who passed the latter order was the successor-in-office of the Judge who passed the order dated 15 November 1935. The learned Judge who passed the order of 19 March 1936 purported to act under Section 151, Civil P.C. I may say at once that in my opinion a Court in the United Provinces is not competent under Section 151, Civil P.C. to issue a stay order to a Court in another province; and there was no real controversy before us on this point. Whether such Court can issue an injunction to a creditor in another province, either under the specific provisions of the Civil Procedure Code or in exercise of its inherent power, is a matter which will have to be considered in its proper place.

(2.) Learned Counsel for the appellants pleads that the object of the Encumbered Estates Act is solely to protect encumbered estates in the United Provinces, not to protect debtors. He argues that the Act was not intended to affect and cannot affect property in another province. Per contra, learned Counsel for the respondent contends that, having regard to the scheme of the Act, a Special Judge in the United Provinces is competent to issue an injunction to a creditor in another province who is seeking to execute his decree against property of the indebted landlord in that province. He points out that under Section 4 of the Act the landlord applying for relief has to disclose in his application to the Collector under that section all his debts, wherever they may exist. Then under Section 8, the Special Judge will call upon him to submit full particulars in respect to his debts, the nature and extent of his proprietary rights in land, the nature and extent of such property as may be liable to attachment and sale under Section 60, Civil P.C. and the names and addresses of his creditors. Neither his debts nor such property as is liable to attachment and sale under Section 60, Civil P.C. are restricted to the United Provinces. Land is defined in Section 2(d) as "a share of or interest in a mahal in the United Provinces"; but land in another province would presumably be included in "property which is liable to attachment and sale under Section 60, Civil P.C." Under Section 9(1) a notice is then published calling upon all persons having claims, whether decreed or undecreed, against the person or property of the landlord to present a written statement of their claims and a copy of such notice is sent under Sub-section (2) by registered post to each of the creditors whose names and addresses have been given by the applicant. Under Section 10 every claimant referred to in Section 8 is required in the written statement of his claim to give full particulars thereof and to state, so far as they are known to or can be ascertained by him, the nature and extent of the landlord's proprietary rights in land and the nature and extent, if any, of the landlord's property other than proprietary rights in land. He is also required to deliver to the Special Judge all documents upon which he relies. Notice is then published under Section 11 specifying the property which has been disclosed by the applicant and also the property which has been mentioned by the various claimants. Section 12 provides for the annulment of certain transfers and it is argued - and no doubt rightly - that this would include a transfer to a resident of another province. Section 13 provides that: Every claim decreed or undecreed against the landlord in respect of a private debt...shall, unless made within the time and in the manner required by this Act, be deemed for all purposes and on all occasions to have been duly discharged.

(3.) The Special Judge then proceeds under Section 14 to hear evidence and examine each claim on a date fixed by him and to determine the amount, if any, due from the landlord to each claimant and thereafter he has to pass a simple money decree in respect of each amount so found. Such decrees are sent to the Collector for execution under Section 19. The next chapter, i.e. Ch. 5, provides for the execution of decrees and the liquidation of the landlord's debts by the Collector. Section 24(3) provides that: For the purpose of execution against property outside the United Provinces the decrees passed by the Special Judge shall be deemed to be decrees in favour of the Collector.