1. In both the cases the point involved is whether a tenant inducted into possession by a court receiver could claim the benefit of the statutory protection even after the discharge of the receiver There was a difference of opinion between the two learned Judges of the Madras High Court. Venkataraman, J.

was of the view that a receiver when he leases out the property he is acting only as a hand of the court. He is not acting as an agent of the party. Though his act will be binding on the person who may be ultimately declared to be the owner of the property

2. Even on equity, the learned Judge pointed out thus

"The court in appointing the receivers was expected to safeguard the property for the benefit of the parties to the action, in particular, the party who might ultimately be found to be the true owner. The court was not expected in the process of appointing the receiver and directing him to lease it out to a tenant, to sell the land itself to the person who was thus let into possession of the land. If we were to hold the contrary now, on the interpretation of the Act, it would be an unwarranted interference with the rights of the parties and would be destructive of the principle that parties come to court for justice and for resolution of their mutual disputes and not for the very property being sold to a third party, who had no right whatever in the property. If the object of the appointment of a receiver was merely to preserve the property and secure a small income therefrom, it might be let out to persons who were willing to surrender possession of the property at the end of the prescribed period without any right to compensation for the superstructure which they might choose to put up at their cost and without any claim to purchase the land itself." *

3. The other learned Judge Justice Maharajan differed pointing out that there was a good deal of difference between receiver in English Law and Indian Law. In any event, having regard to the definition of the landlord occurring under Section 2(3) of the Madras City Tenants Protection Act, 1922 and the definition of tenant occurring under Section 2(4) of the said Act inasmuch as a receiver is entitled to collect the rent, the tenancy will be binding and as such the tenant could claim the benefit of Section 9 namely, the right to purchase the site on which the superstructure has been put up

4. In view of the difference of opinion, the matter was referred to the third learned Judge. V. Ramaswami, J. (as he then was) concurred with Maharajan, J. However, when leave came to be granted, the Full Bench of the Madras High Court in Arumugham Goundar v. Ardhanari Mudaliar [ 1975 (1) MLJ 385 [LQ/MadHC/1974/361] : 1975 AIR(Mad) 231] concluded that the tenancy from receiver cannot endure beyond receivership. In fact, this ruling has been referred to in the order granting leave out of which the appeal arises (Civil Appeal No. 2101 of 1977). Civil Appeal No. 2102 of 1977 is against the order passed in Civil Revision Petition No. 1174 of 1969 in which the respondents claim under Section 9 of the Tamil Nadu City Tenants Protection Act to purchase site on which the superstructure stands

5. Though both Mr Sivasubramaniam, Senior Advocate appearing for the appellants and Mr R.S. Sodhi, appearing for the respondents addressed arguments for and against the proposition, we think, we need not labour much in view of the decision of this Court in Krishna Kumar Khemka v. Grindlays Bank P.L.C. We are aware that that was a case where the receiver leased out the property in the teeth of an injunction order. Nevertheless, this Court approved the Full Bench judgment of the Madras High Court referred to above. In fact, in para 6 it is stated thus : (SCC p. 682)

"Similarly as observed in Arumugha Goundar case [ 1975 (1) MLJ 385 [LQ/MadHC/1974/361] : 1975 AIR(Mad) 231] any such act of the receiver done on behalf of the court pendente lite and anyone who gets possession through such an act could only do so subject to the directions and orders of the court." *

6. Therefore, we hold that a receiver when he leases out property does so as an agent of the court. After all, what is the object of appointment of a receiver To bring the property under custodia legis, once the receiver is discharged, the tenancy also must come to an end

7. There is great reason and justice in holding so. As was pointed out by Justice Venkataraman in the impugned judgment that if the object of appointment of receiver is to preserve the property by fastening a tenancy on the successful party, it will be detrimental to the ultimate person who succeeds to the property. In the instant case as seen from the fact that the appellant Ponnammal succeeded waging many battles. Ultimately her title under the Will executed by Chinna Venkatachala Konar came to be established

8. Therefore, we allow the appeals. There shall be no order as to costs

9. Mr R.S. Sodhi, learned counsel for the respondents, states that his client has effected improvements on the disputed property and he would be entitled to compensation. When we suggested a sum of Rs 30, 000 as compensation for the improvements effected by the respondents, Mr Sivasubramaniam, learned Senior Counsel fairly agree to pay the same. Time for making the payment and for handing over the vacant possession of the disputed property is granted up to 31-3-1995. The respondents shall file the usual undertaking within four weeks from today

CAs Nos. 5822-23 of 1983

10. In view of the order passed in CAs Nos. 2101 and 2102 of 1977, no orders are necessary.