This is an application under Order I, Rule 10, C.P.C. filed by one Asghar Ali Khan for joining the suit/proceedings as a party. In the affidavit, which is filed in support of the application, it is stated that the applicant has submitted offer to run Novelty Cinema (hereinafter referred to as "the subject property") for a licence fee at the rate of Rs,70,000 per month. Upon acceptance, a licence agreement has been executed by the Receiver in his favour. The licence period has commenced from 1-1-1997 and a sum of Rs,1,40,000 has been deposited by the applicant as security and licence fee for the month of January, 1997 has also been paid to the Receiver. The licence has purportedly been granted for a term of one year (52 weeks) and such fact is contained in the recitals alone. It is further averred in the affidavit that the various amounts mentioned in the affidavit have been spent by the applicant for revocation of the subject property and to make it operational. Various certificates purportedly obtained by the applicant for running the cinema have been annexed with the application. However, the receiver claims that such certificates have been obtained by him. I am also taking up Reference No,5 alongwith this application since such Reference is submitted by the Receiver seeking approval for grant of one year licence to the applicant as partner of Messrs Deewan Films Production for running the cinema. According to the receiver, the offer of licence fee at the rate of Rs,70,000 per month made by the applicant is reasonable and the amount is more than double the fees which was paid by the previous lessee.
The parties to the suit who are represented by Messrs Khalid Jawed and M.G. Dastagir oppose the application under Order 1, Rule 10, C.P.C. filed by the applicant. However, the learned counsel for the defendants supports the prayer for approval of licence agreement made through Receiver's Reference No,5. The learned counsel for the plaintiff has opposed the application as well as Reference No,5 and submits that the applicant is neither a necessary nor a proper A party to the proceedings and he has nothing to do with the suit itself which is a claim for money under a promissory note executed by the deceased. It is further urged by the learned counsel for the plaintiff that the Receiver has misconducted himself in running the affairs of the subject property and better offers for running the cinema business are available which can further be improved provided the notice inviting offers is given due publicity. According to the learned counsel for the plaintiff, the publications of notice inviting offers in daily "Aman" cannot be termed as due advertisement. As a matter of fact, Mr. Muhammad Sharif, Advocate, who represents one Bashir Danawala, the lessee at the time the Receiver took over possession, has offered to run the business for a monthly licence fee of Rs,80,000 and according to him he has already submitted such offer in writing to the Receiver. Such position, however, is disputed by the Receiver.
The applicant's counsel submits that under Rule 83 of the Sindh Chief Court Rules (O.S.), the Receiver has the authority to grant lease for a term upto three years without seeking approval of the Court. In my view, however, such provision cannot be pressed in the present case on account of the order whereby the Receiver was appointed by this Court by making it clear that the subject property was taken in custodian legs in order to generate funds for satisfaction of the plaintiff's claim. Moreover, the submission of Reference No,5 alongwith the licence agreement for approval thereof shows that the grant of licence to the applicant was not absolute and was subject to approval of the Court. The making of such reference is well within the knowledge of the applicant who had asserted right of hearing and has, in fact, been heard by me in such behalf.
It is an admitted position on record that the applicant after depositing the monthly licence fee for January, 1997 has not deposited the licence fee for the months of February and March, 1997 which had to be paid in advance by 5th of each month.
I am of the view that the applicant is neither a necessary nor a proper party to the proceedings which are for recovery of money. The learned counsel B for the applicant urged that he was in the minimum entitled to hearing in support of Receiving's Reference No,5. The learned counsel is right to that extent and he has been heard. I have been taken through the various orders passed in the matter and the objections filed in reply to Reference No,5; and, tentatively speaking, I have serious reservations about the conduct of affairs by the Receiver which I shall be adverting to while dealing with References Nos.4 and 6. Be that as it may, since the applicant has been found not to be the necessary or proper C party to the proceedings, his application under Order 1, Rule 10, C.P.C. is dismissed. As to Reference No,5, in my view, there is some force in the submissions made by the learned counsel for the plaintiff and Mr. Mir Muhammad Shaikh who claims ownership rights in respect of the subject property, but such rights are subject-matter of another proceedings being Suit No,150 of 1993 pending before this Court. The applicant has, admittedly, run the cinema under the license granted to him by the Receiver which is subject matter of Reference No,5. On account of the failure of the applicant to make payment of license fee for the months of February and March, 1997, I am not inclined to grant approval of the licence executed by the Receiver in favour of the applicant. However, to mitigate the losses suffered during the intervening period, the security deposit be forfeited for adjustment towards the fee for February and March, 1997 and the possession of the subject property should be taken over by the Receiver forthwith to avoid any pilferage. As to the expenditure incurred by the applicant which is mentioned in the affidavit filed in support of the application under Order 1, Rule 10, C.P.C. no claim can be preferred by the applicant since such expenditure, if any, was incurred voluntarily and without the approval by the Receiver and/or the Court. The Receiver should re-advertise the grant of licence in respect of the subject property and should ensure, this time, that the advertisement is effected through publication in at least two leading Newspapers. It should be specified in the notice inviting offers that the grant of licence shall be subject to approval of the Court. In such process, the parties shall be at liberty to improve the offers or bring better offers. However, such exercise should be done expeditiously to save the support subject property from any losses.
2. This is Reference No,4 by the Receiver seeking payment of fee to him at the rate of Rs,5,000 per month. The Reference is opposed by all the parties. It is urged on behalf of the plaintiff that the Receiver has misconducted himself and has failed to recover the amount of licence fee from the previous licensee namely Asif Iqbal. It is urged by the learned counsel for the plaintiff that the above-named Asif Iqbal was granted licence to run the cinema with effect from 10th May, 1995 for a licence fee of Rs,30,000 per month. The said licensee, Asif Iqbal, paid the licence fee upto December, 1995 but did not pay any amount thereafter. According to the plaintiff's counsel, a sum of Rs,2,35,000 was in all paid by the said Asif Iqbal who continued to run the cinema business upto December, 1996. The Receiver also confirms that Asif Iqbal has not paid anything after December, 1995 and the amount paid by him is Rs,2,35,000. According to the Receiver, the balance sum of Rs,3,55,000 is due and outstanding against the previous licensee, Asif Iqbal, and a notice, dated 11- 1-1997 has already been served upon him for recovery of such amount. I may record here that the notice, dated 11-1-1997, which has been placed on the record, shows that Rs,3,65,000 have been demanded from the above-named previous licensee. However, it is noted with regret and concern that the previous licensee was allowed by the Receiver to run the cinema business without making any payment. It is an admitted position that the December, 1996 when the Receiver desired, he was able to have possession of the subject property from the previous licensee without any difficulty.
The Receiver, therefore, could have taken steps for recovery of licence fee from the previous licensee, regularly and in advance for every month. The Receiver has submitted, during hearing, that he had discovered during the subsistence of licence in favour of the above-named Asif Iqbal that the real licensee was one Shaikh Fazal Haq who was plaintiff's representative and had installed Asif Iqbal for namesake. Such allegation is, however, denied by the plaintiff. In the face of counter- allegations involving the Receiver, who is an officer of this Court, it does not appear reasonable to continue the same Receiver. Such necessity arises for the additional reason that the Receiver has failed to submit accounts, muchless, proper accounts in terms of Rule 87 of the Sindh Chief Court Rule (O.S.). Indeed, the present Receiver intends to proceed for Hajj on 29-3-1997 and he cannot take steps in compliance with the order passed by me in respect of Receiver's Reference No,5. In the circumstances, the Nazir of this Court is appointed as interim Receiver for the time being to act as Receiver of the property known as Novelty Cinema on Plot No,440/2/1, Garden West, Nishtar Road, Karachi with all the power under Order 40, C.P.C. during the absence of the Receiver, immediate steps being taken to perverse and protect the subject property and to take action in accordance with the order passed by me today in respect of Reference No,5. The present Receiver shall deposit the money, lying with him, with the Nazir by 28-3-1997. The Receiver shall also submit ,complete accounts in respect of the subject property and the business, supported by the vouchers, receipts, etc. with the Nazir by 28-3-1997 alongwith the various N.O.Cs. and certificates need for running the business. This, however, does not absolve the Receiver from his responsibilities and the liabilities as may be found or determined in due course. The question of payment of fee to the Receiver and its scale shall be considered after submission of complete accounts by him, as above. Reference No,4 is also disposed of in the above terms.
4. This is Reference No,6 by the Receiver. The Receiver submits that through this Reference he has submitted complete accounts. Objections have been filed by both the parties against this Reference pointing out that complete accounts have not been submitted. A bare perusal of the Reference also shows that the accounts have not properly been submitted. I have already passed orders under Reference listed at serial No,2 that proper accounts have to be filed by the Receiver.