The points for consideration which arise in the present petition are whether the institution of a suit for eviction of a tenant in respect of the premises which is in custody of the Court Receiver would be ab initio bad in the absence of leave being obtained prior to the institution of the suit and whether such a leave can be obtained after the disposal of the suit?
The Apex Court In Kanhalydial's case (supra) has held that, "The general rule that property in custodia legis through its duly appointed Receiver is exempt from Judicial process except to the extent that the leave of that Court has been obtained, is based on a very sound reason of public policy, namely, that there should be no conflict of jurisdiction between different Courts. If a Court has exercised its power to appoint a Receiver of a certain property, it has done so with a view to preserving the property for the benefit of the rightful owner as judicially determined. If other Courts or Tribunals of co-ordinate or exclusive jurisdiction were to permit proceedings to go on independently of the Court which has placed the custody of the property in the hands of the Receiver, there was a likelihood of confusion in the administration of justice and a possible conflict of jurisdiction."
It is also held that,
".... if any Court which is holding the property in custodia legis through a Receiver or otherwise, is moved to grant permission for taking legal proceedings in respect of that 'property, the Court ordinarily would grant such permission if considerations of justice require it. Courts of justice, therefore, would not be a party to any interference with that sound rule."
In the case of Everest Coal Company (supra), the Apex Court has held that.
"....When a Court puts a Receiver in possession of property, the property comes under Court custody, the Receiver being merely an officer or agent of the Court. Any obstruction or interference with the Court's possession sounds in contempt of that Court. Any legal action in respect of that property is in a sense such an interference and invites the contempt penalty of likely invalidation of the suit or other proceedings. But, if either before starting the action or during its continuance, the party takes the leave of the Court, the sin is absolved and the proceeding may continue to a conclusion on the merits."
It was further held therein that,
"... Grant of leave is the rules, refusal the exception. After all, the Court is not, in the usual run of cases, affected by a litigation which settles the rights of parties and the Receiver represents neither party, being an officer of the Court. For this reason, ordinarily the Court accords permission to sue, or to continue. The jurisdiction to grant leave is undoubted and inherent, but not based on black-letter law in the sense of enacted law."
Their Lordships have then observed thus :-
"... Equally clearly, prior permission of the Court appointing the Receiver is not a condition precedent to the enforcement of the cause of action. Nor is it so grave a vice that later leave sought and got before the decree has been passed will not purge it. If before the suit terminates, the relevant Court is moved and permission to sue or to prosecute further is granted, the requirement of law is fulfilled. Of course, failure to secure such leave till the end of the lis may prove fatal."
8. it is thus clear that though it is not a statutory requirement, but a rule of equity based on sound public policy particularly to avoid conflict of jurisdiction between different Courts, that the leave of the Court is to be obtained for any judicial process in relation to the property in custodia legis. It is also by now well established that such leave be generally obtained prior to institution of the suit, but failure thereof can be cured by obtaining the leave during the pendency of the proceedings-
IN THE HIGH COURT OF BOMBAY
Writ Petition No. 4763 of 1987
Decided On: 30.06.2000
M/s Hi-Fi Sound Corporation Vs. M/s. Vinsons, A Firm and Court Receiver, High Court
Hon'ble Judges/Coram:
R.M.S. Khandeparkar, J.
Citation: 2001(2) MHLJ270,2001(1) ALLMR 807
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