' This petition for Civil Revision calls in question the order dated 20-7-1981 passed by the learned District Judge, Lahore, whereby he accepted the appeal against the order dated 30-4-1981 passed by the learned Senior Civil Judge, Lahore and ordered that Receiver should be appointed by the learned trial Court with full control over the income etc., of the business of the partnership with a direction that he should wind it up if possible within a couple of months. It was further directed through the impugned order that respondents should be bound to produce true accounts before the Receiver thus appointed failing which some punitive action might be taken against them.
2. The dispute relates to joint business of the parties pertaining to Plaza Cinema, Lahore, which stands allotted jointly to the parties. In May, 1966, the respondents filed a suit for dissolution of partnership and rendition of accounts against the petitioner in the Court of Senior Civil Judge, Lahore. The suit was contested and necessary issues arising out of the potties' pleadings were framed.
3. The learned trial Court after hearing the parties and considering the documentary evidence produced by them passed a preliminary decree on 26-10-1970 for dissolution of partnership and for rendition of accounts. Local Commissioner was appointed for the settlement/rendition of accounts between the partners.
4. Subsequently orders were passed on different occasions about the change of Local Commissioners. The Local Commissioners in their interim reports protested about the non-co- operation by the petitioner and his failure to provide the accounts books.
5. However, in the meantime the suit was dismissed in default but subsequently the High Court ordered the restoration of the proceeding in 1980. In September, 1980, the respondents applied for the appointment of a Receiver. The learned Senior Civil Judge, vide his order dated 30-4-1981 declined the request but the learned District Judge in appeal reversed the order of the Senior Civil Judge and vide his judgment dated 27-10-1981 directed the appointment of the Receiver. Hence this petition for Civil Revision.
6. The impugned order has been mainly challenged on three grounds ; firstly, that in January, 1967 the trial Court rejected the application for appointment of Receiver and, therefore, his subsequent application was not legally competent ; secondly that Plaza Cinema the joint property of the partnership being still in compensation pool civil Courts had no jurisdiction and more so to pass an order disturbing the possession of the person who was put in possession by the Settlement Authorities ; and thirdly, that even on merits it was not a fit case for appointment of a Receiver and the learned District Judge while passing the impugned order has committed material irregularity.
7. In regard to first contention reliance has been placed on Maharajadhiraj Sir Rameshwar Singh Bahadur v. Hitendra Singh and others. In this case a decree-holder consented to the appointment of Receiver of judgment-debtor's property but shortly after such appointment he applied for Receiver's discharge. His application was dismissed. It was held that this decision operated as bar, for trial of a second application for Receiver's discharge. The binding force of such a judgment depends not upon section 11 of the Code of Civil Procedure but upon general principles of law.
8. It is noteworthy that respondents' application for appointment of Receiver was dismissed in January, 1967 when partnership was not yet dissolved and preliminary decree for renditions of accounts had not been passed. In Motherwell Bridge Contracting and Trading Co. Ltd. v. Riaz Ali Khan etc., it has been held that Court is authorised/competent to appoint a Receiver whenever it appears to be just and convenient to it to do so.
9. In the circumstances of the under consideration case the appointment of Receiver after the passing of the preliminary decree for dissolution of partnership and rendition of accounts cannot be questioned merely on the ground that on an earlier occasion when such preliminary decree was not passed and the question with regard to jurisdiction of the Court was still to be decided, application for appointment of Receiver was disallowed.
10. In regard to the second contention reliance has been placed on All Raza Khan v. Nawazish Ali Khan, wherein it has been ruled that where a person has been put in possession of the properties in dispute by the Revenue Courts after contest on the ground of his having prima facie title to them, it would not be just and convenient to deprive him of that possession and to appoint a Receiver in his place to manage the property.
11. It is contended that Plaza Cinema, the property in question is still in compensation pool and the civil Courts have no jurisdiction in regard to this property and particularly for passing an order disturbing the possession of the person who is put in its possession by the Settlement Authorities.
As a matter of fact this objection has already been dealt with and decided against the petitioner by the learned trial Court. It has been found by the trial Court as also by the High Court in the earlier round of litigation between the parties that the partnership between the parties pertained to the business with regard to which the Settlement Department had nothing to do. The joint business of the Cinema has to be regularized and managed in accordance with the terms of the partnership deed and the mere fact that the building of the Plaza Cinema itself has not yet been permanently transferred to the parties has hardly any bearing so far as the question of dissolution of partnership and rendition of accounts is concerned. It cannot, therefore, he said that in regard to partnership business the petitioner has been appointed as managing partner by the Settlement Authorities and, therefore, that arrangement cannot be disturbed. The above authority relied upon by the learned counsel for the petitioner is thus distinguishable on merits.
12. So far as the third contention is concerned it has been urged on behalf of the petitioner that the learned trial Court while passing the preliminary decree for dissolution of partnership and rendition1 2 3 of accounts considered it expedient to appoint Local Commissioner for the settlement/ rendition of accounts between the partners. There was, therefore, no justification to appoint a receiver in place of the Local Commissioner as has been ordered through the impugned order. It has further been urged that there is no allegation of any loss or peril to the property of the partnership and in the absence of such allegation the appointment of the Receiver which has invariably been considered as the harshest remedy was not called for. In Tirath Singh v. Shromani Gurdwara Prabandhal Committee and another, it has been held that the appointment of a Receiver, is a matter entirely within the discretion of the Court, which should be exercised on sound legal principles in the interest of all the parties concerned and for the protection and preservation of the subject-matter of the litigation. It has further been held that the mere fact that the party making application was likely to experience difficulty in obtaining possession of the suit property in the event of its success and in realizing mesne profits accruing from the land during the pendency of the suit, are not fit grounds for appointment of receiver. It is necessary to allege and prove some peril to the property.
Similarly in Sardar Wali Muhammad v. Sardar Muhammad Iqbal Khan Mokal and 7 others, it was observed that it was discretionary with the Court to appoint a receiver if it was just and convenient to do so and appointment was not as a matter of course. It was further ruled that Order XL, rule 1 of the Code of Civil Procedure did not lay down any clear principles governing the exercise of discretion but these principles have been laid down by the superior Courts. One of these principles was that the power to appoint a receiver should be sparingly used. Another principle was that it should be exercised for the safeguard of the interest of all the parties as well as the property which was subject-matter of the litigation. A third principle was that the possession of persons bona fide in occupation of the property should not be disturbed unless there were allegations of wastage or dissipation of property or apprehension of irreparable loss and injury. Similar view has been taken in Mst. Muhammad Bibi v. Additional Settlement Commissioner, Khaipur and 2 others, and Mst.
Ghulam Zainab and 7 others v. Mst. Tahira Sultan and 3 others.
13. As already observed that Local Commissioner for the settlement/ rendition of accounts was originally appointed on 26-10-1970 while passing the preliminary decree for dissolution of partnership and rendition of accounts. Subsequently on different occasions changes of Local Commissioners have been ordered. All the Local Commissioners so appointed have not been able to settle the accounts. Syed Hamid Ali, Local Commissioner reported on 26-5-1981 that managing party was not intentionally co-operating to give account books for taking accounts. Similarly Mr. Masood Javed, Advocate, Local Commissioner in his report dated 30-7-1971 submitted that the defendants have been reluctant in providing accounts and he, therefore, requested the Court that the defendants be asked to provide the documents and relevant books by a specified date to be fixed by the Court. In this case preliminary decree was passed about 12 years back but the gentlemen as appointed Local Commissioners have not been able to take accounts and settle the dispute in terms of the preliminary decree. It is to be seen that in the under consideration case preliminary decree for dissolution of partnership and rendition of accounts has already been passed and in such a case appointment of receiver has generally been made as a matter of course. In Ali Muhammad Iqbal v. Sadarudin, it was held that if the partnership stood dissolved pursuant to a valid notice, therefore, the consequence should be the appointment of a receiver as a matter of course. In Ghulam Hussain v. Muhammad Riazuddin, it was found that where partnership was dissolved as a result of valid notice for dissolution it was a fit case for appointment of receiver. In Muhammad Jamil v. Iqbal Ahmad, it was found that the appointment of receiver must automatically follow on dissolution of a partnership and that no person can insist on continuance of partnership.
14. In the light of the afore-quoted judicial precedents it can be concluded that in case of dissolution of partnership, appointment of receiver has to be ordered as a matter of course for4 5 6 7 8 9 10 taking accounts and for winding up of the business of the dissolved partnership.
15. It is also noteworthy that through the present petition the impugned order passed by the learned District Judge has been called in question by invoking the revisional jurisdiction of the High Court under section 115 of the Civil Procedure Code. The scope of such jurisdiction which may appropriately be called as supervisory jurisdiction of the High Court is highly limited. This jurisdiction can be involved if the subordinate Court D has exercised jurisdiction not vested in it or has failed to exercise jurisdiction vested in it by law or has acted in exercise of its jurisdiction illegally or with material irregularity. While describing the scope of the revisional jurisdiction of the High Court the Judicial Committee of the Privy Council observed in N. S. Venkatagiri Ayyangar and another v. Hindu Religious Endowments Board, Madras, that section 115 of the Code of Civil Procedure empowered the High Court to satisfy itself on three matters-(a) that the order of subordinate Court is within its jurisdiction, (b) that the case is one in which the subordinate Court ought to exercise jurisdiction, and (c) that in exercising jurisdiction the Court has not acted illegally, that is, in breach of some provisions of law, or with material irregularity i. e, by committing some error of procedure in the course of the trial which is material and that it may have affected the ultimate decision. It was further observed that if the High Court was satisfied on these three matters, it had no power to interfere because it differed, however, profoundly, from the conclusions of the subordinate Court on questions of facts or law. This view was adopted in Klzawaja Noor Muhammad v. Namdar. In Muhammad Hussain Munir and others v. Sikandar and others, it was ruled by the Supreme Court of Pakistan that in exercise of its constitutional jurisdiction the High Court misdirected itself in setting aside the revisional order of the Member Board of Revenue, who was validly seized of the case, merely because in its opinion it was "against equity". It was further held that tribunal having jurisdiction to decide a matter was competent to decide it rightly or wrongly and mere fact that the decision was incorrect did not render the decision as without lawful authority. It was observed in this case that the High Court's constitutional jurisdiction was assimilable to its jurisdiction under section 115 of the Code of Civil Procedure.
16. In the circumstances of the instant case, there is nothing on the record to suggest that while passing the impugned order the learned District Judge lacked jurisdiction in the matter or there has been any failure in exercise of jurisdiction vesting in him by law. The order otherwise also does not suffer from any illegality or material irregularity. In this view of the matter and in the light of the judicial precedents, just quoted above, it is not a fit case warranting the exercise of the revisional jurisdiction of this Court, under section 115 of the Code of Civil Procedure.
17. For the foregoing reasons the present petition for Civil Revision fails and is accordingly dismissed with costs. AIR 1924 P C 202 PLD 1978 Kai. 1093 AIR 1937 Oudh 280 AIR 1931 Lah. 688 PLD 1975 Lah. 492 PLD 1976 Kar. 181 PLD 1977 Lab. 830 PLD 1959 Kar. 452 1975 Law Notes Lah. 433 PLD 1977 Kar. 351 PLD 1949 P C 2611 12 13 1 2 3 4 5 6 7 8 9 10 11