P.S.S. Meyappa Chettiar vs Nagammai Achi

Bardswell, J.—The petitioner was a party to the proceedings u/s 145, Criminal P.C., the dispute being one as to the possession of a house.

The Sub-divisional Magistrate found that possession was not established by either party and on 27th February 1930, passed an order attaching the

house until the right to possession of it by one party or the other was determined by a civil Court. This order was confirmed by the High Court in

revision on 12th December 1930. The applicant for revision was the present petitioner. On 30th June 1932 the receiver who had been appointed

in accordance with Clause 2, Section 146, Criminal P.C., asked for permission to lease the house and on the following day he leased it to the

petitioner. On its becoming known to the Joint Magistrate that the lease had been given to one of the disputing parties he removed the receiver

from his appointment and set aside the lease. Against the order cancelling the lease the petitioner has come up on revision.

The point taken for the petitioner is that when the lease had once been granted, it could not be cancelled summarily as it has been, by the Joint

Magistrate, but that the only procedure was to bring a suit against the petitioner after giving him notice u/s 111, T.P. Act. Clause 2, Section 146,

provides that a receiver who is appointed under it is to have, subject to the control of the Court, all powers of the receiver appointed under the

Civil P.C. By Order 40, Rule 1, Civil P.C., the Court may confer on a receiver all powers of management, etc., or such powers as the owner

himself has as the Court thinks fit. In the present instance there seems to have been no limitation imposed upon the powers of the receiver and so it

is to be taken that he had all the general powers of management, and these powers of management include the granting of leases. It is stated in

Woodroffe and Ameer Ali''s commentary on the Civil P.C., that, under the general permission of the Court, a receiver may in his discretion let out

the property for any period not exceeding three years, but that he may not do so for a longer period without obtaining special permission. I should

note that in this case a lease has been granted to the petitioner until such time as the civil Courts have decided the matter. It is possible that the

lease may endure for less than three years, but it is equally possible that it may last for a considerably further period. Such an indeterminate lease

was certainly not a proper one for the receiver to grant. That however a lease can be granted by the receiver within the limitations above stated

seems beyond question and is not indeed disputed. The Magistrate has stated in his order that it has been clearly held by various High Courts that

a receiver must take specific instructions from Courts and act strictly in accordance with the same, but he has not stated what his authorities are,

neither have they been mentioned in this Court in the course of the arguments on this petition. The receiver has in fact, in this case, asked

permission before hand of the Magistrate to grant the lease, but once he has got that permission, it does not seem that he needed to ask the

permission of the Court as to whom the lease should be granted, so long, at least, as he did not practise a fraud upon the Court.

The Joint Magistrate has based his decision on the ruling in Mt. Lachmi Kuar Vs. Gajadhar Proshad and Others, . But this decision does not

bear on the point raised by Mr. K.S. Jayarama Ayyar for the petitioner. It has nothing whatever to do with the granting of any lease. What it does

is to declare the principle that, when an attachment has been made u/s 146 pending the decision of the civil Courts, possession should not be made

over to either party to the dispute so long as the attachment continues. For such a principle authority is hardly required. Though the order u/s 146

does not prohibit the entrance of any party upon the property in dispute pending the decision of the civil Court, it is clearly implied by the fact of

attachment that neither party is meant to enter upon the property in any circumstance till the civil Courts have decided the matter. The decision on

which Mr. Jayarama Ayyar lays stress is in Krista Chandra Ghose v. Krista Sakha Ghose (1909) 36 Cal 52, a decision of Woodroffe, J., who is

an eminent authority on the law of receivers. In that case it was held that, when a lease had been already granted by a receiver, the matter had

passed beyond the Court''s control and that, even though the lease had been granted to one of the parties, that party was not subject to the

jurisdiction of the Court as lessee. It was also made to appear in that case that, even in the case of collusion between the receiver and his lessee,

the proper course was to proceed by a suit. Nothing however is said in this decision as to what will be the position if a fraud has been practised

upon the Court. As to that there is another decision of the same High Court, which is found in Sirish Chandra Banerjee and Another Vs. Debendra

Nath Banerjee and Others, . In that case it was held by a Divisional Bench that misrepresentation or concealment by a receiver of material facts

are sufficient to justify the Court in setting aside a lease summarily when that lease has been granted in consequence of such misrepresentation or

concealment of facts. It has been pointed out by Mr. Jayarama Ayyar that in that particular instance it would appear that the receiver had no

authority to grant leases, but this does not matter from the point of view of Mr. Jayarama Ayyar''s contention, which is that in no circumstances can

a lease once granted by a receiver be set aside except by means of a suit. In the circumstances of that case the learned Judges of the Calcutta High

Court did not set aside the lease as they found that there had been no fraud, but they made it clear that if there had been a fraud they would have

set it aside. I take this as an authority that, if it is found that there has been a fraud upon the Court in granting and obtaining a lease, a Magistrate is

entitled to set the lease aside in a summary manner as the Magistrate has done in the case under review. The receiver in this case applied on 30th

June 1932, for permission to grant a lease without stating to whom it was intended that the lease should be granted. On the very next day, after the

permission was given, the lease was granted to the present petitioner. Mr. Jayarama Ayyar urges that it was an indication of the good faith of the

receiver, that he reported the matter to the Court on the very day of the lease, i.e., on 1st July 1932, but I find that this does not help the petitioner

at all, as in that report there was concealment of facts which has to be regarded as deliberately intended to mislead the Court. The name of the

person to whom the lease was given was indeed mentioned, the name being Meyappa Chetty, but this name is not a very unusual one and the

Court cannot be expected to bear in its mind the names of all parties to proceedings before it. There is no reference in the report to the lessee

being one of the parties to the proceedings u/s 145. There is indeed a reference to the lessee having in his possession 71 keys, but it is not

mentioned in what capacity he had those keys, and it was not to be expected from this casual reference, which came at the end of the report, as to

the 71 keys, that the Magistrate should gather that the lessee was one of the parties to the inquiry u/s 145. Had the Magistrate known that the

party to whom the lease was being given was one of the parties to the inquiry, he would not have allowed the lease to be given to that party.

I am satisfied that the petitioner, with the connivance of the receiver, has been guilty of a very impudent fraud upon the Court and has by these

means obtained a lease which he would not have otherwise got, by the terms of which he was to have possession of the property in dispute so long

as the dispute remained undecided. The Magistrate, therefore had every justification in setting aside the lease and I am further satisfied that he had

authority to order its cancellation. The petition is dismissed.