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1962 DIGILAW 67 (KER)

A. v. Moothedan

1962-02-27

P.GOVINDA NAIR

body1962
Judgment :- 1. An advocate of this Court, Sri. A.V. Moothedan, raises the question regarding the advocate's fee payable to him for certain proceedings under S.4 of the Insolvency Act 1956 for the conduct of which he was engaged by the Official Receiver with the sanction of the court. These proceedings, I am told, ended successfully and the estate gained more than a lakh of rupees. The counter-petitioner is the Receiver, District Court, Ernakulam. 2. On 5-10-1959, the revision petitioner wrote to the Receiver that the amount involved in the proceedings is about Rs. 11/4 lakhs and that the proceedings should be treated as proceedings in an original suit and if fee is calculated on that basis, he will be entitled to Rs. 3000. He also requested in that letter that an initial payment of Rs. 1500/- may be made to him and that the Merchants Bank of India, Ltd., one of the creditors, who had undertaken to provide funds towards the cost of the proceedings may be directed to pay him a sum of Rs. 1500/- as interim payment towards advocate's fee. The above letter was forwarded by the Receiver to the Bank mentioned above and the Bank paid the petitioner Rs. 1500/-. After the decision of the case, the petitioner filed I.A. No. 809 of 1960 on 27-5-1960 and requested the court to direct payment to the petitioner reasonable remuneration for the work done. Notice was issued to the Receiver on the above application and he did not oppose. The Merchants Bank which had undertaken to meet the expenses also did dot raise any objection. Some of the creditors, however did object and contended that nothing more than Rs. 100/- should be paid to the advocate. The court below accepted this objection and on the ground that the rules do not permit payment of more than a maximum of Rs. 100/- rejected the application of the revision petitioner. This revision is directed against the above order. 3. Apparently, the rule referred to is R.30 read with R.12(d)(2) of the rules framed by the Travancore-Cochin High Court under S.16 of the Indian Bar Councils Act XXXVIII of 1926. 100/- rejected the application of the revision petitioner. This revision is directed against the above order. 3. Apparently, the rule referred to is R.30 read with R.12(d)(2) of the rules framed by the Travancore-Cochin High Court under S.16 of the Indian Bar Councils Act XXXVIII of 1926. It is contended before me that R.30 is ultra vires the power of the High Court and should not therefore be considered as limiting the discretion vested in the Insolvency Court to direct payment of a reasonable remuneration to the revision petitioner for the work done by him. S.16 of Act XXXVIII of 1926 reads: "16. Power to fix fees payable as costs: The High Court shall make rules for fixing and regulating by taxation or otherwise the fees payable as costs by any party in respect of the fees of his adversary's advocate upon all proceedings in the High Court or in any Court subordinate thereto." It is clear from a mere reading of the section that the power of the High Court to frame rules is only for the purpose of fixing and regulating the taxation of the fees payable as costs by any party in respect of the fees of his adversary's advocate. R.30 of the rules framed by the High Court says that the fees payable to the advocate of the adversary is also the fee payable to one's own advocate in the absence of an agreement under R.2 for an excess amount. R.2 enables an advocate who acts or agrees to act for any person to settle with such person the terms of his engagement and the fee to be paid for his professional service. 4. The revision petitioner has a case that the letter dated 5-10-1959 written by him to the Official Receiver, referred to above, and wherein he has made a claim for Rs. 3000/- and for an interim payment of Rs. 1500/- coupled with the payment of Rs. 1500/- as part payment of fee would constitute an agreement between the official Receiver and the revision petitioner as contemplated in R.2 of the rules. I do not think so. 3000/- and for an interim payment of Rs. 1500/- coupled with the payment of Rs. 1500/- as part payment of fee would constitute an agreement between the official Receiver and the revision petitioner as contemplated in R.2 of the rules. I do not think so. From the fact that the Official Receiver sent the letter dated 5-10-1959 to the Merchants Bank and the latter made part payment towards fees, it is not possible to conclude that there has been an agreement between the Official Receiver and the revision petitioner that a sum of Rs. 3000/- will be paid to the revision petitioner towards fees. There is nothing to indicate that the above letter was placed before the court and the court has sanctioned the payment of any particular fees to the revision petitioner. In the absence of sanction of the court, it appears to me that the Official Receiver is not even competent to agree to pay any specified amount towards fees. 5. The question whether R.30 referred to above, precludes the court from sanctioning reasonable fees to the advocate has to be considered next. The provisions of S.16 will not enable the High Court to frame a rule fixing the fees payable to one's own advocate. Notice of this revision petition was issued to the Advocate General, and Mr. V.P. Gopalan Nambiar, Government Pleader, appeared before me on his behalf. He very fairly conceded that the High Court was not empowered under S.16 of Act XXXVIII of 1926 to make rules fixing the fee payable to one's own advocate. It has therefore to be held that R.30 is no impediment to the court exercising its jurisdiction in fixing a reasonable remuneration to the advocate engaged by the Receiver with the sanction of the court for the work done. 6. Reference may also be made to S.80 of the Insolvency Act, Act II of 1956, which I am extracting below: "80. The costs of any proceeding under this Act, including the costs of maintaining a debtor in the civil prison, shall subject to any rules made under this Act, be in the discretion of the Court in which the proceeding is had." And S.61 (e) authorises the Receiver to employ a pleader or other agent to take any proceedings. The costs of any proceeding under this Act, including the costs of maintaining a debtor in the civil prison, shall subject to any rules made under this Act, be in the discretion of the Court in which the proceeding is had." And S.61 (e) authorises the Receiver to employ a pleader or other agent to take any proceedings. No rule framed under S.80 of Act II of 1956 restricting the discretion of the court in the matter of costs of any proceedings under the Act has been brought to my notice. The discretion vested in the court under S.80, therefore, remains unfettered by any restrictions imposed by any rule. I am, therefore, of the view that it is open to the court to fix a reasonable remuneration for the work done by an advocate. It appears to me that considering the nature of the work done by the advocate and the value of the subject matter of the suit, a fee of Rs. 3000/- claimed by the revision petitioner is reasonable. But this is a question that has to be decided by the Court below under S.80, and I therefore set aside the order of the court below and remit the case to that court with a direction to exercise its discretion under S.80 of Act II of 1956 and fix a reasonable fee as remuneration for the work done by the revision petitioner. I make no order as to costs. Allowed.