Honble SHARMA, J.–This revision arises from the order dated 5.12.1996, passed by the learned Additional District Judge Bundi, whereby the defendant-petitioner was appointed as a Receiver of the partnership properties on his submitting a security bond for an amount of Rs. 1,25,000/- and two sureties of Rs. 62,500/- each. He was also directed to keep true and correct account of properties and capital of the partnership and to submit the said account every month before the Court. The amount received from the medicine sold by the Receiver shall be deposited in the Court but the Receiver would not be entitled to purchase any new medicine or to do any business in the name of the partnership. A direction was also issued that the Receiver would pay to the plaintiff non-petitioner his share of profits fallen due to him within 15 days by depositing the same in the court, he would also deposit the entire cash of the partnership business which is in possession within 15 days. The Receiver would be entitled to receive a remuneration of Rs. 500/- per month. It was also directed that in case the defendant does not execute the bond or agree to be appointed as Receiver the plaintiff would be appointed Receiver on the same conditions. (2). The plaintiff non-petitioner (for short the plaintiff) instituted a suit for dissolution of partnership and rendition of accounts against the defendant petitioner (for short the defendant) in the trial Court with the allegations that on 25.10.1994 the plaintiff and defendant had entered into a partnership for running retail medical store. The partnership was for a period of five years. The defendant violated the terms of partnership. The amount which was required to be deposited was not so deposited. Net profit was not divided and the plaintiff was not allowed to inspect the accounts. A notice was served for dissolution of partnership and the defendant was required to stop the business but he did not do so. Along with the suit an application for appointment of Receiver was also filed. (3). The defendant submitted reply and pleaded that the accounts have been kept properly and he never refused inspection of accounts by the plaintiff. The plaintiff was required to spend four hours daily for looking after the business but after working for a few days, he did not devote any time. The partnership cannot be broken before 5 years.
(3). The defendant submitted reply and pleaded that the accounts have been kept properly and he never refused inspection of accounts by the plaintiff. The plaintiff was required to spend four hours daily for looking after the business but after working for a few days, he did not devote any time. The partnership cannot be broken before 5 years. The defendant did not violate any condition and the suit was not maintainable. The entire investment made in the business and the machines taken on credit were the liabilities of the defendant, the plaintiff was not required to make any investment, therefore, more harm will be occasioned to defendant in the event of appointment of Receiver. (4). The trial Court rejected the application for appointment of Receiver but directed that the defendant would submit the true and correct accounts every month in the Court and would also pay the share of profit of the plaintiff which had became due uptill June 1995 within a period of one month and would also deposit every month the due profits which would come to the share of the plaintiff from July 1995 onwards. The plaintiff was also directed to spend 4 hours every day for working in the business of the partnership and if he does not do so the defendant would be entitled to deduct Rs. 500 per month from his share of profit. (5). The plaintiff preferred appeal against the said order and the lower appellate Court reversed the order of the trial Court and appointed defendant as Receiver as indicated above. (6). After having heard learned counsel for the parties and after careful appraisal of the impugned order I am of the view that the learned Additional District Judge committed jurisdictional error in passing the impugned order and if the said order is allowed to stand it would occasion failure of justice. (7). The principle deduced from the authorities cited at bar is that in order to justify the appointment of Receiver, the plaintiff must establish a reasonable possibility that the plaintiff will ultimately succeed in obtaining the relief claimed in the suit. It may further be remembered that the appointment of Receiver is, as a general rule, discretionary, and not a matter of right.
It may further be remembered that the appointment of Receiver is, as a general rule, discretionary, and not a matter of right. A Court will make an appoint- ment of Receiver with great caution and circumspection when it appears to the Court just and convenient to protect and preserve the property against an imminent danger of loss or diminution in value, destruction, squandering, wastage or removal from jurisdiction. (8). In the case on hand there was no justification in appointing the defendant as Receiver. There was no perversity in the order of the trial Court which was discretionary in nature. To my mind the learned appellate Court could not have imposed such conditions which could affect the business adversely. The trial Court though rejected the application for appointment of Receiver but protected the rights of the plaintiff during the pendency of suit by imposing certain conditions. (9). Consequently, the revision succeeds and is hereby allowed. The order dated 5.12.1996, passed by the learned Additional District Judge Bundi is set aside and the order dated 4.7.1995 of the Civil Judge (Junior Division) Bundi is confirmed. No costs. However, in the facts and circumstances of the case the learned trial Court is expected to complete the trial of the civil suit within three months.