HARYANA FINANCE TRADING CO v. STATE — 1993 DIGILAW 373 (CAL)

R. BHATTACHARYYA, J. ( 1 ) -BY an agreement of Hire Purchase, dated 19. 7. 90, the respondent came to possess a Motor Vehicle bearing No. 364052 349770 on the chasis and No. 692 Do 7 360996 on the Engine subject to performance of its terms and conditions embodied in the agreement among which a dispute, if any, to be resolved by the sole arbitrator was one. The respondent succeeded in making part payment of the 10 instalment out of 23 and the total amount thus paid was Rs. 1,26,130. 00 in aggregate. ( 2 ) THE respondent for his lack of financial capability could not square lap the dues payable under the agreement and surrendered the possession of the vehicle inconsequence on 20. 10. 1992. He requested fervently the financier to recover the dues and the sum if received in excess be paid to the hirer. ( 3 ) THE financier intimated by its letter dated 22. 11. 92 to the hirer that the amount could not be recovered as the estimated value or price came down to Rs. 2. 8 lakhs demanding further sum from him to pay up the balance. ( 4 ) THE financier by the letter spoken of booked the hirer with the information to effect sale of the same by him at a higher price. Thereafter, the hirer actuated by an ill motive instituted a title suit claiming restoration of the possession of the vehicle along with other ancillary reliefs among which the appointment of the receiver was one. ( 5 ) THE learned court below disposed of an application preferred under section 41 of the Arbitration Act, 1940, as the contentions of the respondent were found favour with the learned court below. ( 6 ) THE learned court below by the order impugned being order No. 11 dated 4. 5. 93 came to the conclusion upon hearing the parties that major portion of the price of the vehicle since paid already by the plaintiff -respondent, the vehicle be restored to him and Swapan Kumar Pal, Advocate was appointed as 'receiver' with the object of taking possession of the same on payment of Rs. 500/- by the plaintiff. This has now became all sore in this litigation. To heal up the sore, the petitioner has knocked on the door of the court challenging the propriety of the order. 500/- by the plaintiff. This has now became all sore in this litigation. To heal up the sore, the petitioner has knocked on the door of the court challenging the propriety of the order. ( 7 ) THE determination of the question in the background of the above set of facts is as to whether a court could appoint a Receiver and direct return of the vehicle. ( 8 ) MR. Banerjee, the learned Advocate, appearing in support of the petitioner-revisionist has made a forceful contention which in my view is of greater momentum. The bedrock of his submission is that a court cannot, in exercise of power under section 41 of the Arbitration Act, 1940 in absence of dissipation and waste could appoint a Receiver for preservation of the property. The principle for appointment of Receiver, under section 41 of the Arbitration Act, 1940, does not land on a different footing as engraved in the wealthy provision of order 40 of the Code of Civil Procedure. ( 9 ) TO trace the source of power and circumstances, where such appointment has been recognised by the statute, one may fall back on the provisions of the Code which state that in all cases in which it shall appear to be just and convenient where the court may appoint a Receiver. But, in absence of dissipation, waste, apprehended sale and threatened injury, the appointment of Receiver is impermissible. ( 10 ) TO be elaborate on the subject, the ratio decidendi in Krishno Swamy v. Thangavalu, AIR 1955 Madras 430 and Srinivasu Rao v. Babu Rao, AIR 1970 Mysore 147, where their Lordships had laid down 5 principles which should not be lost sight of by the court while exercising equity jurisdiction in appointing Receivers. ( 10 ) TO be elaborate on the subject, the ratio decidendi in Krishno Swamy v. Thangavalu, AIR 1955 Madras 430 and Srinivasu Rao v. Babu Rao, AIR 1970 Mysore 147, where their Lordships had laid down 5 principles which should not be lost sight of by the court while exercising equity jurisdiction in appointing Receivers. They are : (I)that the question of appointing a Receiver is a matter resting in the discretion of the court ; (ii)that a Receiver should not be appointed unless the party has an excellent chance of succeeding in the suit; (iii)that plaintiff himself shall show that there some emergency or danger or less that may be caused to the right involved in the suit ; (iv)that an order appointing a Receiver shall not be made if it has the effect of depriving a defendant of a defacto possession, that, however the position would be different if the property is shown to be in medio, i. e. to say in the enjoyment of no one; and (v)that the court should always look into the conduct of the parties to seek for the appointment of Receiver and above all the general and almost over-riding principle is that an application for the appointment of the Receiver should always be promptly made and delay in making it is a circumstances unfavourable to such an appointment. ( 11 ) KEEPING in accord with the view, it looms large that the materials of dissipation, waste, apprehended danger, threatened injury or loss are mateculously silent. It gleans from the record that the payment of instalment was restricted to 10 only out of 23. The learned court below in the background of the welter of facts did not advert to consider the potency for appointment of the Receiver, in particular there is not even the remotest shadow of the circumstances listed above affording jurisdiction to the court to appoint a Receiver. Besides, it prima facie appears from Annexure 'b' that the vehicle in question was surrendered in favour of the petitioner on 20. 10. 92. It may be presumed safely that the financier wrote a letter dated 21. 11. 92 (Annexure 'd') affirming the surrender of the vehicle and gave a publicity therein about the dues. The matter prima facie did not end there. 10. 92. It may be presumed safely that the financier wrote a letter dated 21. 11. 92 (Annexure 'd') affirming the surrender of the vehicle and gave a publicity therein about the dues. The matter prima facie did not end there. The hirer was invited by the financier in die said letter enclosing a detail of payment and the dues "to sell the vehicle at a higher price?? then you are most welcome to do so within a week after receiving letter". A copy thereof was sent to Rajendra Singh. Thereafter, a lapse of considerable period, the plaintiff-respondent instituted the title suit in or about December 1992, while the surrender of the vehicle took place on 20. 10. 1992. It demonstrates a considerable volume of hirer's conduct. ( 12 ) MUCH has been canvassed by Mr. Chakraborty, opposing the application that the agreement was executed during duress where the financier obtained signatures of the hirer on the blank papers. Though a court of revision does not suppose to consider the factual aspect of the matter yet a court of revision may reasonably expect that material facts should find their way in the bosom of the claim of a party in making assessment of the prima facie case of that party seeking either appointment of a Receiver or the prayer made for issuing injunction as the case may be. There is at complete black out in the order impugned about the prima facie materials that weighed with the learned court to pass such an order complained of. It is glaring from the order itself that the non-filing of the arbitration agreement in original became a fatal flaw to the claim of the petitioner-revisionist following which it had to suffer an order against all the canons of law. Mr. Chakraborty has not disputed for a moment that the Xerox copy of the agreement annexed to the application does not even remotely show that it was spurious nor its authenticity had been challenged even before this court, nor the opposite party was even laconic of its existence. The invitation made by the petitioner-revisionist for the sale of the vehicle by die plaintiff-respondent dated 22. 11. 92, as aforesaid, prima facie sprang up from the letter of the plaintiff-respondent dated 22. 10. 92. It was so close on its hill that its genuineness could hardly be disputed at this stage. The invitation made by the petitioner-revisionist for the sale of the vehicle by die plaintiff-respondent dated 22. 11. 92, as aforesaid, prima facie sprang up from the letter of the plaintiff-respondent dated 22. 10. 92. It was so close on its hill that its genuineness could hardly be disputed at this stage. ( 13 ) THE next line of contention of Mr. Chakraborty, the learned Advocate, appearing for the opposite party is that the vehicle was not surrendered but taken possession of after having recourse to force. But, it is surprising that there is not even prima facie slender material in the shape of 1st Information Report or G. D. disclosing the seizure of the vehicle by means other than holy. Therefore, it could be safely concluded prima facie that the story of seizure of the vehicle is but a ruse. ( 14 ) FURTHER, it is manifest from the order impugned that the learned court below has expressed grave doubt about the authenticity or genuineness about the document. To make the document valnerable he has sought for the aid of section 73 of the Indian Evidence Act, 1872. But, in my view, the court cannot display the role of an expert by comparing the admitted writing with disputed writing. There is not even any iota of material that proof of signature or writing was ever adhered to in accordance with law. But, it is nonetheless true that court must discharge its duty under section 73 either with the aid of expert or with reference to authoritative text book. The order impugned maintains an unnatural silence that any help was sought for in the manner aforesaid. ( 15 ) IN my view, it is not advisable that a Judge should take upon himself the task of comparing the disputed writing with the admitted writing in order to find as to whether two agrees with each other. The prudent course, in my opinion, should be explored in order to obtain the opinion and assistance of an expert. This is particularly so in view of the suspicious circumstances in which the document in question has been produced. But I cannot persuade myself to agree with the learned court below on that count in absence of an material as doubt expressed is not supported by any material. This is particularly so in view of the suspicious circumstances in which the document in question has been produced. But I cannot persuade myself to agree with the learned court below on that count in absence of an material as doubt expressed is not supported by any material. ( 16 ) THE return of the vehicle by appointing a Receiver will in my view, not strike the balance. On the other hand, the balance sought to have been made to the detriment of the interest of the petitioner-revisionist which will ultimately become an imbalance as there is not even the slightest indication or reflection in the order itself, as to how the payment of the dues of the financier would be ensured. The custody of the vehicle at this stage if given to the plaintiff-respondent it may result in multiplicity of proceedings. In the alternative if the financier is made the Receiver subject to execution of a bond to the satisfaction of the court for running the vehicle by the hirer and the usufructs thereof be appropriated by the financier after meeting the outgoings or necessary expenses, the same, I believe, may adjust the claim between the parties. ( 17 ) PERSUADED by the aforesaid circumstances, the case of the petitioner revisionist fairly and squarely comes within the fold of section 115 of the C. P. C, where interference is permissible. ( 18 ) IN the result, the Civil Rule succeeds with the above observations. The record must go down to the court below to proceed with the case in accordance with law. Rules succeeds with observations.