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Judgment
Alfred Henry Lionel Leach, C.J.—The question here is whether a decree passed by the City Civil Court declaring that the appellant is
entitled to a charge over the proceeds of the sale of property belonging to one Natesa is effective as against the respondent, who is Natesa''s
brother. In 1931 Sabapathi Chetti, the father of Natesa and the respondent, died leaving a will dated the 15th October, 1931, by which he
bequeathed to Natesa a house known as 2|46, Erulappan Street, Madras and to the respondent a house known as 17,, Kuniarappa Mudali Street.
The respondent was then a boy of about ten years of age. On the 28th. October, 1936 the estate of the minor was vested in the Official Trustee of
Madras and as the guardian of the respondent''s property he obtained probate of the father''s will. Natesa had taken possession of both, the
properties and the Official Trustee was compelled to file a suit (No. 79 of 1937) on the Original Side of this Court to recover possession of the
minor''s interest in his father''s estate. The Official Trustee based his case on two grounds. In the first place he contended that the respondent was
entitled to the property representing No. 17, Kumarappa Mudali Street, by reason of the will. In the second place he said that even if the will were
invalid, the respondent was entitled to have the properties partitioned and his share delivered to him. The Court appointed the Official Trustee the
receiver in the suit. It transpired that after his father''s death, Natesa had created a mortgage on. the property left to him. By an order of the Court
this property was sold and the mortgage discharged out of the proceeds. There remained a balance of Rs. 1,927-5-3, which was paid into Court
to the credit of the suit.
On the 17th February, 1938, the appellant instituted O.S. No. 244 of 1938, in the City Civil Court against Natesa for a decree for specific
performance of an agreement to execute in his favour a mortgage of the Erulappan Street property. He averred that he had advanced moneys to
Natesa in anticipation of the mortgage. In the alternative he asked for a charge on the property to the amount of Natesa''s indebtedness to him. On
the 8th August, 1938, the appellant applied for an attachment before judgment of the ""Rs. 1,927-5-3, lying to the credit of the Official Trustee''s
suit in this Court. The appellant had not received permission of this Court to apply for the attachment of these moneys, and as for the time being
they were vested in the Official Trustee in his capacity of receiver in C. S. No. 79 of 1937, the appellant''s action amounted to contempt of Court,
but his action was not resented and the attachment remained effective until the 27th of July, 1939.
On the 9th January, 1939, the appellant was granted a decree in his suit against Natesa. The Erulappan Street property had by this time been
sold and therefore it was not possible for the Court to give a decree for specific performance of the mortgage, but it gave a money decree for Rs.
760, with interest and costs, and a charge on the property to the extent of the decretal amount. The property having been converted into money
and part of the money spent in discharging the mortgage over the property, the charge could only be effected, if at all, on the money lying to the
credit of the Official Trustee''s suit in this Court. In the meantime, namely on the 18th August, 1938, the Official Trustee as receiver applied for the
payment out to him of the money in Court. On this application Venkataramana Rao, J., passed this order:
The balance of the amount, deducting'' the amount of the attachment may be paid to the Official Trustee. I leave it to the Official Trustee whether
he should contest the attachment.
The attachment referred to in this order was of course, the attachment obtained by the appellant in the City Civil Court and it meant that the
attachment was to remain effective to the extent of the appellant''s claim against Natesa, unless the Official Trustee took steps to challenge it. The
Official Trustee took no steps to challenge, the attachment until the appellant applied to this Court for an order allowing him to withdraw sufficient
of the money in Court to satisfy his decree against Natesa. When this application was made, the Official Trustee objected, and as a result of his
objection the Master held that the attachment was invalid, because at the time it was made it had not been decided to whom the balance of the sale
proceeds of the Erulappan Street property belonged.
On the 26th January, 1940, Somayya, J., gave judgment in the Official Trustee''s suit. The learned Judge found the will to be valid and
consequently held that the respondent was entitled to the Kumarappa Mudali Street property with mesne profits from the date on which Natesa
took possession. As the result of investigation it was found that the respondent was entitled to a sum of Rs. 3,150 by way of mesne profits. On the
4th March, 1941, the Official Trustee, as the decree-holder in C.S. No. 79 of 1937, applied for an order attaching the balance of the sale
proceeds of the Erulappan Street property lying to the credit of the suit. It was then the appellant''s turn to object. Relying on the charge which the
City Civil Court had given him, he resisted the application of the Official Trustee and the Master held that his objection was well-founded. The
respondent appealed and Krishnaswami Ayyangar, J., reversed the decision of the Master. The learned Judge considered that the decree of the
City Civil Court was invalid as against the receiver in C.S. No. 79 of 1937, and on this ground he reversed the Master''s order. This appeal is from
the order of the learned Judge.
Mr. Rajah Aiyar on behalf of the appellant admits that his client was guilty of contempt in applying for the attachment of the moneys which the
Official Trustee as receiver was entitled to hold in C.S. No. 79 of 1937, but he pertinently points out that no complaint was ever made on this
ground and that his client''s action in applying for attachment does not affect his present case. He contends that his client was entitled, as against
Natesa, to ask for a charge on Natesa''s property or the moneys realized by the sale without impleading the receiver, but even if he ought to have
made the receiver a party, the fact that he did not do so does not mean that the decree passed of the City Civil Court can be regarded as a nullity.
The receiver knew of the suit, but he did not seek to be made a party and at no time did he offer any objection to the reliefs which the appellant
was seeking. When the Official Trustee himself applied for the attachment of the moneys in Court after he had obtained a decree in his suit, he did
so not as receiver, but as the Official Trustee.
In Kumar Suttya Ghosal v. Rani Golap Moni Debi (1897) 5 C.W.N. 27, the Calcutta High Court held that a receiver is not a necessary party to
a. suit for possession of immovable property where the facts were these. The petitioners claimed to be the absolute owners and had been in
possession as howladars of certain land in the district of Khulna. A receiver had been appointed to take charge of these lands but persons claiming
adversely to the petitioners were in actual possession. The petitioners desired to bring a suit against those persons for possession and sought to join
the receiver as a party. The Court held that the receiver was not a necessary party. In Administrator-General v. Dasai Goundan (1910) 9 M.L.T.
300, Wallis, J., followed this decision and referred to the case of Smith v. The Earl of Effingham (1844) 49 E.R. 1103 : 7 Beavan 357. In the last
mentioned case a receiver had been appointed in a suit in which the priority of different incumbrances on an estate was to be determined. A person
who claimed to be the first incumbrancer had not been made a party to that suit and he filed a bill of his own to establish his right. It was held that
the receiver was not a necessary party to his suit.
The learned advocate for the respondent relies on the decisions in Mrs. Levina Ashton v. Madhabmoni Desi (1910) 14 C.W.N. 560 Fraser and
Ross Vs. Krishnaswami Iyer and Others, , and Kalyanasundaram Ayyar v. Narasimha Ayyangar (1922) 44 M.L.J. 427. In the first of these eases
the Calcutta High Court held that the sale of a foreclosure decree without the leave of the Court while the estate was in the possession of a receiver
was illegal and liable to be avoided. That case is no authority for the proposition that the decree of the City Civil Court passed in favour of the
appellant is a nullity. Whether it could be set aside at the instance of the Official Trustee as such or as the receiver is, of course, another matter. In
Jotindranath Chowdhury v. Sarfaraj Mia (1910) 14 C.W.N. 653, the Calcutta High Court held that where property in the hands of a receiver is
intended to be affected by the result of the suit the receiver is a necessary party to the suit. Again we do not regard this as an authority for relieving
the Official Trustee of the necessity of getting rid of the decree obtained by the appellant, if he wishes to secure for the benefit of the younger
brother the moneys which are in Court. In Fraser and Ross Vs. Krishnaswami Iyer and Others, the question was whether the Court should have
made the receiver a party to certain execution proceedings and Kalyanasunram Ayyar v. Narasimha Ayyangar (1922) 44 M.L.J. 427, had
reference to an assignment taken in good faith. In our opinion these cases also have no bearing on the question under discussion.
It is not necessary for the Court to decide whether the Official Trustee as the receiver in his suit should have been made a party to the
appellant''s suit or what steps are open to him to take. As far as this appeal is concerned the governing factor is that the appellant was granted a
charge in a decree passed by a Court of competent jurisdiction and that decree stands. In these circumstances, can it be said that the Official
Trustee as representing the respondent is entitled to priority? We think not. The appointment of the Official Trustee as receiver did not give the
respondent a charge. The receiver was an officer of the Court appointed to hold the property in suit for the benefit of the person who could show a
title to it. The respondent had no title to the moneys in Court. They belonged to his elder brother, and when the Official Trustee was granted a
decree the respondent had no greater rights than were conferred by the decree. The appellant was in a better position because a Court of
competent jurisdiction had given him a charge over the moneys. In these circumstances we consider that the decision of the Master should not have
been disturbed.
The appeal will be allowed with costs and the Official Trustee will be directed to redeposit the money into Court.