KANHAIYALAL v. DR. D.R. BANAJI AND OTHERS
Citation: [1959] 1 S.C.R. 333; 1958 INSC 32
Court: Supreme Court of India
Bench: BHUVNESHWAR PRASAD SINHA , SYED JAFFER IMAM, K. SUBBA RAO
Judgment date:
Case summary
1958 INSC 32. Supreme Court of India judgment dated 1958-03-31. KANHAIYALAL v. DR. D.R. BANAJI AND OTHERS. Read the judgment and case details on LawSphereX.
Judgment text
S. O. R. SUPREME COURT REPORTS 333 allowed depreciation and rehabilitation on an erroneous basis, we would set aside the order of the Labour Appellate Tribunal and would restore that of the Industrial Tribunal with this modification that the Respondent shall make available the additional amount required for payment of the proportional bonus to the artisans. • The appeal is, therefore, allowed to this extent, the order of the Labour Appellate Tribunal set aside and the award of the Ind11strial Tribunal restored with this modification that the respondent shall also provide an additional amount for these three years for payment to the artisans of proportionate bonus on the basis of the "Unit System". As neither of the parties have succeeded in their main contentions, the fair order in regard to costs should be that the parties do bear their respective costs throughout. KANHAIYALAL v. Dr. D. R. BANAJI AND OTHERS (B. P. SINHA, JAFER IMAM and SuBBA RAO JJ.
) R~venue Sale-Property in possession of Receiver appointed by Court-Absence of leave of Court for sale-Notice to Receiver not given-Whether sale illegal-Whether suit to set aside sale by civil court barred-Berar Land Revenue Code, I928, ss. I55, IS6, Ij7, I92. The appellant was the auction-purchaser of the property at a revenue sale held under the provisions of the Berar Land Revenue· Code, 1928, for recovery of land revenue due. The property at the time of the attachment and sale was in the possession of a Receiver appointed under Or. 40, R. 1 of the Code of Civil Procedure by the Jilombay High Court. Notice to the Receiver, however, was not given of the attachment and sale of the pi;operty, nor was any leave of the Court taken for the sale.
In a suit instituted by the Receiver for a declaration that the sale was a nullity o~, at any rate, was illegal and liable to be set aside, the auction-purchaser contended that the sale without notice to • the Receiver or without impleading him was not void but only voidable and that, in any event. the suit was barred by the provisions of ss. 157 and 192 of the Berar Land Revenue Code, 1928 : Held, (1) that the sale was illegal in the absence of the leave of the Court and the necessary notice to the Receiver; · (2) that the suit was not barred by any of the provisions of the Code. Sub-section (1) of s. 157 of the Code which bars the institu-tion of a suit to set aside a sale is confined only to claims on the ground of irregularity or mistake i11 publishing or conducting the sale as referred to in s. 156, and suits based on other grounds, including those referred to in sub-s. (2) of s. 157, are not within the prohibition of sub-s. (1).
Section 192 of the Code is not applicable as the suit is not one simpliciter to set aside the sale held by the revenue authorities, but one for a declaration and consequential relief on the grounds taken by the Receiver not covered by the specific provisions of the Code for setting aside the sale which the several authorities under the Code have been empowered . to determine, decide or dispose of within the meaning of s. 192(1). CIVIL APPELLATE Jt:RISDICTION: Civil Appeal No. 128of1954. Appeal from the judgment and decree dated January 25, 1951, of the Nagpur High Court in L. P. Appeal Nq. 10 of 1945, arising out of the judgment and decree dated March 29, 1945, of the said High Court in Second Appeal No. 453 of 1941, against judgment and decree dated April 5, 1941, of the Adell. District Judge, Yeotmal in Civil Appeal No. 47-A of 1940 arising out of the judgment and decree dated September 14, 1940, of the Add!. Sub-Judge, :First Class, Yeotmal in Civil Suit No. 72-A of 1940 .
"Radhey Lal, for the appellant . . P. N. Bhagwati, J. B. Dadachanji, S. N. Andley and Rameshwar-Nath, for respondent No. · I. · R. H. Dheb'fl,r, for respondent No. 2. 1958. March 31. The following Judgment of the Court was delivered by Sinha]. SINHA J. -The main question in controversy iJJ. this appeal on a certificate of fitness granted by the High Court of Judicature at Nagpur (as jt then was}, is • whether the provisions of the Berar Land Revenue Code, 1928 (which will hereinafter be referred to as the Code), bar the suit out of which this appeal arises. In order to appreciate the points in controversy in Dr. this appeal, it is necessary to state the following facts: One Bhagchand J airamdas was the occupant of a plot, situated in the District town of Yeotmal in what was then called the Province of Central Provinces and Berar, measuring 1,91,664 square feet in area, on which stood a ginni~ factory and its appurtenant buildings.
Bhagchand aforesaid had executed a mortgage-bond in favour of one Abubakar. The mortgagee aforesaid instituted a suit on the original side of the Bombay High Court, being Civil Suit No. 1543 of 1934, to enforce the said mortgage, A Receiver was appointed on October 20, 1936, during the f>endency of the suit in respect of the mortgaged properties including the plot described above. The land and the buildings and the factory, have been valued by the courts below at about Rs. 70,000. The revenue payable in respect of the plot in question, at the rate of Rs. 129 per year, appears to have remained in arrears for two years, namely, 1936-37 and 1937-38. The Sub-Divisional Officer of Yeotmal, functioning. as the Deputy Commissioner under the Code, sold at auction the plot in question, free of all encumbrances, on December 17, 1937, without impleading or giving notice to the Receiver who was in-charge of the estate of Bhagchand, as aforesaid. At that auction, Kan-.
haiyalal, the appellant, purchased the property for Rs. 270 only. The sale in his favour was confirmed on January 26, 1938, but it appears that the tlien Heceiver had sent Rs. 275 by a cheque to the Sub- Divisional Officer concerned, in full payment of the arrears of land revenue, and thus, to have the sale set aside. But it was received two days afte\' the confirmation of the sale. Before the confirmation of the sale, the Receiver had made an application on January 19, 1938, to the Sub-Divisional Officer, offering to pay the arreMs, but it appears that through some bungling in the office, the attention of the Sub-Divisional Officer was not dra-wn to the application until after the T • confirmation of the sale. Tho H,eceiver then applied for a review of the order confirming the sale, and the Sub-Divisional Officer allowed the application and set aside the sale. The Deputy Commissioner, Yeotmal, and the Commissioner, Berar, also upheld the order setting aside the sale.
Thereupon, the auction-purchaser, Kanhaiyalal, moved in revision the Financial Commissioner who was then the highest Revenue authority under the Code, against the order of the Commissioner, and ultimately, t1'. e order setting aside the sale, was vacated by the Financial Commissioner on the ground that there was no application under s. 155 or s. 156 of the Code. The then Receiver, having ultimately failed in having the sale of the valuable properties by the revenue authorities, set aside, instituted the suit out of which this appeal arises, impleading the Provincial Government of Central Provinces and Berar, as the first defendant, Kanhaiyalal, the auction-purchaser, as the second defendant, and Dulichand Bhagchand as the third defendant.
He prayed for a declaration that the auction-sale held on December 17, 19:37, was void, on a number of grounds including the grounds that no ilotice of demand had been sent to the H,eceiver who was in-charge of the property; that the attachment and sale proclamation had not berm effected · according to law, and that though the revenue authorities were aware of the appointment of a Receiver of the property, by the Bombay High Court, they did not implead the Court Receiver. This snit was contested on the preliminary ground that it was barr@d by"the provisions of ss. 157 and 192 of the Code. That plea found favour, both, with the trial court and the court of appeal(Additional District Judge, Yeotmal). On second appeal to tho High Court of Judicature at Nagpur, the ~ase was heard by a Single Judge, Niyogi J. who allowed the appeal by judgment dated March 29, 1945. On a Letters J.
>atent appeal by the auction-purchaser, Kanhaiyalal, the matter was heard by a Division Bench (Mangalmurti and Deo JJ. ) -The Bench affirmed the decision of the learned Single • • Judge, and held that the suit was not barred. Hence, this appeal. It was urged on behalf of the appellant, the auction-purchaser, who was the second defendant in the suit, and who only is interested in having the sale in question, sustained by the Court, that the sale without notice to the Receiver or without impleading him, ~as not void but only irregular, and secondly, that in any event, the suit was barred by the provisions of ss. 157 and 192 of the Code. The first defendant, the State Government, which was represented by Mr. Dhebar, prayed that, in any event, there should be no order for costs either in favour of or against the Government. On behalf of the plaintiff-respondent, it was urged that .
Property in the hands of a Receiver is custodia legis, and is exempt from all judicial processes except to the extent that the Court which. has appointed the Receiver, may accord permission to the Receiver or to third parties to institute proceedings in respect of the property; that no permission of the Bombay High Court which had appointed the Receiver, having been taken for the sale of the property, the sale held without such· a permission, is a nullity; that, at any rate, such a sale was not a mere irregularity but an illegality and could be avoided by suit; that there being no valid attachment of the property with notice to the Receiver, the attachment itself was illegal, and on that ground also, the sale was void; and lastly, that the suit was not barred by the provisions of the Code, as held by' the High Court. • The facts as set out above, are not in controversy.
During the time that the proceedings culminating in the sale of the property, had been pending in the Revenue Courts, the Receiver was in effective control and management of the property. The r~venue authorities had been apprised of the fact that the Receiver appointed by the Bombay High Court, was in-charge of the property. As a matter of fact, an attempt had been made•by the revenue authorities, in the first instance, to approach the Collectol' of Bombay for realising the • arrears of land revenue in respect of the plot in question, but the mistake was that no approach was made to the Bombay High Court or even to the Receiver for paying up the arrears of the Government demands.
It was certainly the duty of the Receiver to see to it that all public demands in respect of the properties in his charge, were paid in due time, and in this case, certainly, the arrears in respect of the year 1937-3~, which fell due in August, 1938, accrued in his time, if not also the arrears in respe RDHANDAS PURSHOTTAMDAS SONAVVALA AND ANOTHER v. THE EASTERN COTTON COMPANY (BHAGWA'rI, J. L. KAPUR and GAJENDRAGADKAR JJ. ) Cotton, Contracts-Cotton Association-Statute providing for cotton contracts to be in accordance with the by-la121s of the Association -By-laws prescribing Forms of Contract-Substantial compliance with Form-V aUdity of the contracts-Bombay Cotton Contracts Act, x932 (Bom. IV of I932), s. 8(I). · Sub-section~r) of s. 8 of the Bombay Cotton Contracts Act, r932. provides: "Save as hereinafter provided in this Act, any contract .... which is entered into after the date on which this Act comes into operation and which is..
not in accordance with the by-laws of any recognized cotton association shall be void". In respect of the transactions in cotton entered into bet\veen the parties, the appellants had to pay the respondents a sum of money for failure to gi\'e delivery of the cotto~1 bales under the . , •
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