Ata-Ul-Huq, Official Receiver, Rawalpindi v. Sk. Md. Ramjan
1938-12-15
body1938
DigiLaw.ai
JUDGMENT 1. This appeal arises out of proceedings taken by the Respondent for executing a decree which he has obtained against an Abdul Rahaman described in the decree as proprietor of S. Abdul Rahaman and brothers. The suit was on a promissory note and the decree was a consent decree passed on the 2nd January, 1937. The decree is sought to be executed by realising the money due from the Officer Commanding the 1st Battalion of the Cameronions stationed at Barrackpore on bills submitted in the name of S. Abdul Rahaman and Brothers. The point in controversy in the appeal is whether the decree-holder had by the consent decree a charge on the money due at its date from the said officer. The application for execution was filed on the 7th January, 1937. On the 28th June, 1937, Abdul Rahaman and two other persons, Md. Abdulla and Fazal Karim, were adjudicated insolvent by the District Judge of Rawalpindi and the Appellant is the Receiver in Insolvency. The adjudication proceeded on the footing that all the three were partners of the alleged Firm S. Abdul Rahaman and Brothers. 2. The executing Court duly attached the money lying in the hands of the Commanding Officer. Thereafter the Receiver intervened in the execution proceedings and on the 17th December, 1937 applied to the executing Court for withdrawing the attachment. The position that he took up was that the money was due to him for distribution among the unsecured creditors of the insolvents. In answer to his claim the decree-holder stated that as he had a charge on the same he was entitled to proceed on with the execution in spite of the insolvency of his debtor and take for his own benefit and for the satisfaction of his decree the money that may be realised from the Commanding Officer. The learned Subordinate Judge has accepted the contention of the decree-holder. 3. It appears that Abdul Rahaman had been arrested before judgment at the instance of the Respondent and was in civil jail when the consent decree was passed. The consent petition on which the decree proceeded and which has been made a part of the decree runs thus:-- (1) That the suit will be decreed with costs.
3. It appears that Abdul Rahaman had been arrested before judgment at the instance of the Respondent and was in civil jail when the consent decree was passed. The consent petition on which the decree proceeded and which has been made a part of the decree runs thus:-- (1) That the suit will be decreed with costs. (2) That the Defendant has no objection to the Plaintiff appropriating towards his decretal amount any part of the amounts payable by the First Battalion Cameronion Scottish Rifles, now stationed at Barrackpore on account of the bills of supplies etc., by the Defendant to the said Battalion. The said amount has already been attached by two other persons e.g., Hazi Abdul Gani and Sheik Abdul Hamid, and the Plaintiff would be entitled at any rate to rateable distribution, if any. If the full decretal amount is not realised in the manner aforesaid, any amount thus realised would be treated as part satisfaction of the decree. The Defendant also undertakes to help the Plaintiff in all possible ways for the collection of the amount through Court or amicably from the Regiment and if necessary Plaintiff would be entitled to apply for attachment before judgment if so advised. (3) That the Defendant would be released from the civil jail and that Plaintiff has no objection thereto. (4) That the Defendant totally denies the claim of the aforesaid Abdul Hamid who has obtained an attachment on a false claim. 4. The question in controversy turns upon the second paragraph of this petition. The principle is well-established and is not disputed by Mr. Dass appearing for the Receiver. It is that when a debtor promises to the creditor to pay out of a particular fund, the creditor has a charge on the same. But he submits that in para. 2 no such promise is made. He says that the debtor has only said that he will not object to the creditor appropriating for the satisfaction of his dues along with two other creditors of Abdul Rahaman the money due from the Commanding Officer. For this purpose he draws our attention to the second sentence of para. 2 which provides for rateable distribution with the other two creditors who had also attached the said fund. His further submission is that the provision about attachment in the last part of para.
For this purpose he draws our attention to the second sentence of para. 2 which provides for rateable distribution with the other two creditors who had also attached the said fund. His further submission is that the provision about attachment in the last part of para. 2 also indicates that the parties proceeded on the footing that Md. Ramzan was to have a simple money decree only. We cannot accept Mr. Dass's contention. 5. The statement that the judgment-debtor would have no objection to the decree-holder appropriating towards his decretal amount part of the money then lying in the hands of the Commanding Officer coupled with the condition that he would render all aid to the decree-holder for realising the same amounts to a promise on his part to make the said money available to the decree-holder. The decree-holder was given by contract with the judgment-debtor the right to satisfy himself from the said fund. He has accordingly acquired a charge on the said fund. 6. The provision about rateable distribution does not militate against the view we are taking. The charge so created would have been void against the two other persons who had already attached the fund. The parties provided for that contingency, and stated in effect that in that event the decree-holder would not lose his right of rateable distribution with them. The words that " the Plaintiff would be entitled at any rate to rateable distribution " indicate this. The provision about attachment before judgment has no meaning, for there could be no attachment before judgment after the decree had been passed. 7. We accordingly hold that the decree-holder had a charge on the said fund. It must, however, be made clear that the charge operated on the money due on the unpaid bills which had been submitted to the Commanding Officer upto the 2nd January, 1937. The decree-holder can have no charge on moneys payable under bills submitted later on. The Court below must determine in the presence of the Receiver what amount out of the moneys sent to Court by the Commanding Officer are in payment of bills submitted by " S. Abdul Rahaman land Brothers " upto the 2nd January, 1937. The decree-holder will have a charge on this amount and the balance must be made over to the receiver on proper receipt. 8. One other point must be noticed.
The decree-holder will have a charge on this amount and the balance must be made over to the receiver on proper receipt. 8. One other point must be noticed. Abdur Rahaman could charge only his interest in the money. If he was the sole proprietor of S. Abdul Rahaman and Brothers the matter ends. But the Receiver's case is that he alone was not entitled to the same, but Md. Abdulla and Fazal Karim, the other two insolvents, had also shares in the same. The Receiver's claims have not yet been established. In these circumstances we think that the ends of justice require that the money should be kept in Court for three months from this day to enable the Receiver to take such steps as he may be advised for enabling- him to prevent payment to the decree-holder pending the adjudication of his alleged claim. If the Court receives no intimation of any prohibitory injunction on the decree-holder within the said period, it will pay out to the decree-holder the amount to which he may be found to be entitled in accordance with our directions. Whatever we have said above should not be token to prejudice the rights of Hazi Abdul Gani and Sheik Abdul Hamid, the two persons who are mentioned in para. 2 of the consent petition on the basis of which the decree-holder obtained his decree. The appeal is accordingly dismissed. Hearing fee 2 gold mohurs.