' This revision petition is directed against the appointment of a receiver of the joint property ordered by the Civil Judge, Lahore, on 10-12-1975, and confirmed by the learned Additional District Judge by his order dated 4-2-1976 passed in appeal.
2. It is stated that on the demise of S. S. Abdul Hameed in 1945, his property impressed of residential houses, haven, shops, rooms, stores as well as a Cinema house known as 'Pakistan Talkies" with machinery etc. Situated in Lahore and another residential house in Gujranwala as detailed in para. 4 of the plaint, devolved on his widow and eight sons including Major S. S. Rashid-ul-Hameed deceased. He died in 1964 leaving behind a widow, a son and two daughters, the respondents. They have now filed the present suit for administration of the property on the allegation that the estate with its assets was still undivided lying in control and management of the petitioners as agents. It was averred that the petitioners arbitrarily received and realized large sums from the joint trust property, which they invested in various forms, made huge deposits in various banks in their names, and that it was learnt that the immovable property had since been mismanaged, and the income was being pilfered, wasted and misappropriated by manoeavering incorrect accounts and concealing real income to the disadvantage and huge loss to the plaintiffs-respondents.
3 The plaint was presented on 29-7-1970 and the respondents on 5-7-1973 made an application under rule 7 of Order XXXIX, C. P. C. For detention and preservation of the property by directing the petitionersdefene ants to place full accounts cf the property, failing which the property be inspected and the accounts seen by the Court to ensure the preservation of the property and its accounts. The application was pending disposal that on 15-10-1973 the learned counsel for the plaintiffs-respondents expressed his desire to make an application for appointment of a receiver.
The application was moved under rule 1 of Order XL, C. P. C. On 21-1-1974 by Anjum Ma, one of the daughters of the late Major S. S. Rasheed-ul-Hameed, on her attaining majority. It was stated that the property was joint with the parties, and the income of the property and the running of the Cinema was held in trust by the defendants all the time in the past, and that since the death of her father, the defendants had not enabled the applicant to know about the running of the affairs of the property and the Cinema, and no money was paid to her. It was further averred that the property and running of the Cinema was being mismanaged, and the income was pilfered to the detriment of the applicant and the state by shoeing fictitious income in the accounts and, according to her information, the Cinema was leased to a defendant for a very nominal sum to evade income-tax and misappropaiate the share of the applicant. It was stated that huge money received from the income of the property and the running of the Cinema had been accumulated by the defendants in their Banks in the form of cash, jewellery and National Defence Saving Certificates. An apprehension was shown that the defendants, who were interested to prolong the final conclusion of the suit, were now adopting novel methods of misappropriating the income from the property and the running of the cinema to the detriment of the applicant, and that if appropriate action was not taken in time the applicant and her minor brother and sister were likely to suffer irreparable loss and injury, and the property was likely to be further misappropriated, damaged and ruined.
4. The application was hotly contested by the petitioners-defendants. Several objections to the maintainability of the application and the desirability of the appointment of a receiver were raised.
They contended that removing them from their lawfu1 possession was neither just nor convenient.
The allegations in the application were denied. It was alleged that the cinema stood leased out not only since the demise of S. S. Abdul Hameed predecessorin-interest of the parties but even before that. According to the defendants, the whole property was leased out and yielded a definite income, therefore, the apprehension of pilferage did not exist, nor was any allegation about wastage or damage of the property made in the application. However, on the allegations of the parties, two issues were framed and after recording evidence the trial Court appointed a receiver, and an appeal against that order did not find favour with the learned Additional District Judge, therefore., the same was dismissed. However, the remuneration of the receiver was reduced from Rs, 2,000 to Rs, 1,200 per mensem. The petitioners-defendants have, therefore, come up in revision.
5. The learned Additional District Judge, while disposing of the appeal, observed that a receiver could be appointed although there might be a dispute with regard to a portion of the property. The cinema was held to be yieding a monthly income of Rs, 600 only through the petitioner but S. S. Yameen-ul-Hameed was not a lessee. Even if he was a lessee of the cinema, he, being a party also, could be evicted by the receiver in due course of law. The contention that the entire property was under lease and yielded a definite income was repelled, and it was held that the main dispute between the parties was regarding the actual income which was allegedly pilfered by the petitioners. On the question whether or not the property was being wasted or its income misappropriated, the learned Additional District Judge simply observed that the income from the cinema was highly meagre, and the petitioners had failed to pay any amount to the respondents.
This led to the conclusion that the property was not only mismanaged but also the share of its income was not regularly paid to the plaintiffs, However, on the point of damage tc the property there was n finding. On such various grounds, the learned Additional District Judge thought proper to dismiss the appeal. At the Same time, the remuneration of the receiver was reduced to Rs, 1,200 per month.
6. In the matter of the appointment of interim receiver, it is not denied that the immovable property detailed in the plaint was left by the late S. S. Abdul Hameed, the predecessor-in-interst of the parties, and since his death it remained undivided. It is also not denied that the respondents had a share in it, and that the petitioners-defendants, while in possession, controlled and managed it.
Tee claim of the applicant was that they held the property in trust, but since the death of her father they did not enable her to know how much income was derived from the property, and nothing was paid to any of the plaintiffs-respondents. Much stress has been laid on the running of the cimerna known as Pakistan Talkies, and in her application under rule 1 of Order XL, C. P. C., the applicant wanted to show as if the receiver was desired to be appointed primarily for the business of the cinema, for, the running of the cinema was specifically kept apart from the management of the property itself.
7. It was alleged by the petitioners that the cinema house was on lease since the lifetime of the original owner, and sometimes after Independence it was continuing on lease with them. It was asserted by them that the condition of the cinema was hopeless, and to make it in a running condition they had incurred an enormous expenditure. On the contrary, the learned counsel for the respondents relied on the statements of the witnesses and referred to the contents of al application dated 2-9-1947 alleged to have been made by S. S. Saeed-ul-Hameed, one of the defendants, to the District Magistrate, Lahore, for the grant of a cinematograph licence in favour of Messrs. Azizul Hameed and brothers, landlords and proprietors of Pakistan Talkies. On this evidence, it was argued that all the brothers, including the late Major S. S. Rashid-ul-Hameed, the father of the respondents, was a partner not only in the building but also in the business of running a cinema. I need not go into such details at this stage because a finding in respect of the partnership of the respondents in the business would prejudice the parties. It is a matter primarily for determination at the trial and not at the time the interim matter like the appointment of receiver was taken up. At present, it is sufficient to indicate that the business of the cinema does not prima facie appear to be included as subject-matter of the suit. It is pointed out on behalf of the respondents that business gets mention in para. No, 3 of the plaint, and that the building and the business were not separated from each other. If read as a whole, the para. Deals with the estate and assets of the late S. S. Abdul Hameed. It is mentioned that the petitioners were receiving the entire income of the property and "the running cinema" duly fitted with machinery and accessories.
This would not show that the business run in the property was also the subject of the suit. A building is an immovable property, whereas the business carried on therein would not be so. While going through the contents of the plaint and the description of the property, it is evident that the suit filed by the respondents was for administration of immovable property left by S. S. Abdul Hameed. This, by itself, would show that the business allegedly evidenced by the letter dated 2-9-1947 referred to above addressed to the District Magistrate was not left by the deceased predecessor-in-interest but was a creation after his death, which would not be deemed to be included in the suit. Para. 4 of the plaint deals with the particulars of the immovable property in possession of the defendants.
The description is given in sub-paras. (a) (i) to (ix), (b) and (c). A mention of some m Arable property as jewellery, ornaments etc. Is made in para. 5 but there is no indication about the joint business of the cinema. The prayer relates to preliminary decree for administration of property decidedly the one detailed earlier and for its assets, and also for a final decree by partition and separated possession.
8. Rule 1 of Order XL, C. P. C. Lays down that (1) where it appears to the Court to be just and convenient, the Court may by order (a) appoint a receiver of any property, whether before or after decree; (b) remove any person from the possession or custody of the property; (c) commit the same to the possession, custody or management of the receiver ; and (d) confer upon the receiver all such powers, as to bringing and defending suits and for the realization, management, protection, preservation and improvement of the property, the collection of the rents and profits thereof, the application and disposal of such rents and profits, and the execution of documents as the owner himself has, or such of those powers as the Court thinks fit. It is further laid down in clause (2) that nothing in this rule shall authorise the Court to remove from the possession or custody of property and person whom any party to the suit has not a present right so to remove.
The word "any property" occurring in clause (1) (a) of rule 1 does not mean that the Court has power to appoint a receiver of any property even though not the subject-matter of the suit. Any property mentioned in the rule would mean any type of property, whether immovable or movable, A residential or commercial but it is necessarily to relate to the suit. Relying on Pounchbai v. Lekh Raj (1) and Kadir Bakhsh v. Emperor (2) the same view is taken in Firm Manghaimal v. Mikonbal and others (3). This being the position, the appointment of receiver for a property not sued for is without jurisdiction.
9. Leaving the business of the cinema aside, the property made the subject of the suit is the immovable property including property No, A-1114-A cinema "Pakistan Talkies" with machinery, furniture, fans etc. Detailed
(1) 4 I C 605 (2) AIR 1920 Pat. 501
(3) AIR 1933 Sind 231 in Para. No, 4 of the plaint. It is settled law that the discretion vesting in a Court of appointing a receiver of property is to be sparingly exercised, and one recognized principle is that before the possession of the party is disturbed, there must be an allegation of waste. In Shahzadl Sharp"'
Sultana v. Frig. Shahzada Sher Muhammad Jan and (mother (1) two cases Gov't:4 Naraln Rao Dalai v. Vallabhrao Narayanrao Desai (2) and Sant Ram v. Ram Chand (3) were cited and it was set down that as a general rule the Court will not, in a partition suit, between members of a joint family, appoint a receiver except by consent and upon proof by the plaintiff that prima facie he has a very excellent chance of succeeding in establishing the case made out in the plaint and the property in possession of the opposite-party is in danger of being wasted, and that the mere fact that there is a dispute is no reason whatever for appointing a receiver. It was further endersed that a receiver should not be appointed when the application is based, not upon any specific allegation of misconduct, but upon a mere apprehension that the defendant, though he has done nothing in the past, will after the institution of the suit proceed to waste the property.
10. The appointment is made to preserve property pending litigation to decide rights of the patties, or to prevent a scramble among those entitled. In suits for partition of property bet veen co- sharers, a receiver is not appointed as a matter of course, Anyhow in such cases, it is necessary to allege and prove some peril to the property. The appointment then rests on the sound discretion of the Court. In exercising its discretion, the Court proceeds with caution and is governed by a view of all the circumstances. The appointment of a receiver is recognized as one of the harshest remedies which the law provides for the enforcement of rights and is allowable only in extreme cases where the interest of the creditors is exposed to manifest peril. The party seeking appointment of a receiver, therefore, has to show some emergency or danger or loss demanding immediate action.
The element of danger is an important consideration, and a Court will not act on p Amble danger only. The danger must be greet and imminent demanding immediate relief.
11. In the present case, there is no such assertion that the property was in danger of being wasted. It is stated in the plaint that the property left by their predecesor-in-interest was still undivided lying in possession of the defendants as agents who had been receiving the entire income, therefore they, being the trustees, were responsible to render accounts of the income and profits accrued from the movable and immovable property. It was further asserted that defendants arbitrarily received and realized large sums from the joint property which they had invested in various banks in different forms, and that it was learnt that immovable property had since been mismanaged and the income was being pilfered, wasted and misappropriated to the plaintiffs' great disadvantage. In para. 8 of the plaint, the allegation of misappropriation and wastage was attributed to certain household articles belonging to the respondents store in one of the houses.
From the entire pleadings, there is no assertion about any of the property in suit of being wasted.
The attribution of mismanagement was the misappropriation or the income and non-payment of share. In the same way, the application for appointment of receiver also contained similar allegations. As pointed out earlier, this much material was not enough to justify the removal of, the petitioners from their lawful possession as a co-sharer by appointing a receiver.
(1) PLD 1958 Lah 288 (2) AIR 1920 Born. 321
(3) 36 P C 1910
12. The petitioners are continuing in possession since 1947 and, according to their version, since before the death of the original owner. During all this time no action was taken by the respondent- applicant o her father against the alleged pilferage. Parties who have acquiesced in D property being enjoyed against their own alleged rights cannot, except in special circumstances, come to the Court for a receiver. It is held in Mst Muhammad Bibi v. Additional Settlement Commissioner, Khairpur and 2 others (1) that showing of a prima fade case was not enough. When there was no allegation of malversation or waste made against person in possession for more than 18 years, he cannot be dispossessed by appointment of a receiver merely on the ground of difficulty in recovering profits or property in event of success of the applicant.
13. The learned counsel for the respondents, on the other hand, cited a few authorities on the advisibility of appointment of receiver and submitted that it v as appropriate where there was an allegation of misappropriation of partnership funds, but it cannot be lost sight of that the principle in a suit for dissolution of partnership is different from the one for partition In Muhammad Ismail All Charan v. Pakpor Ceramics Ltd. (2) it is laid down that if a suit was for dissolution of a firm and the plaintiff alleged exclusion and not waste or malversation, the Court would appoint a receiver from among the defendant partners, but if the plaintiff showed that there was a reasonable apprehension of waste or malversation of the firm's assets, the Court would remove the defending partners from the management of the firm and appoint the plaintiff or a third party as an interim receiver. It is, therefore, evident that a suit for rendition of accounts and dissolution of partnership would require the appointment of a receiver in normal F circumstances, but such a necessity is vary meagre in a suit for partition unless there is an allegation of a substantive waste.
14. Taking the overall picture of facts and circumstances of the case, the appointment of a receiver was not justified. The learned Courts below have wrongly exercised jurisdiction, therefore, the revision petition is allowed and the orders of the learned Courts below are set aside. The parties shall bear their own costs.
(1) PLD 1976 Kar. 181 (2) PLD 1973 Kar. 491