1. The events antecedent to the order by which the Courtbelow has refused the application of the Petitioner for rateable distributionunder sec. 73 of the Code of 1908, are not the subject of controversy betweenthe parties. In execution of a decree held by the Roys against the Mookerjeesand a Receiver appointed by this Court, the properties owned by thejudgment-debtors were sold on the 20th June 1910. One fourth of thepurchase-money was deposited on that date and the balance was paid into Courtby the purchaser on the 1st and 2nd July following. Sarat Kumar Banerjee whohad previously obtained a decree against the judgment-debtors Mookerjees on the25th January 1905, then made an application for rateable distribution on the18th June 1910. Objection was taken by the Receiver that as leave had not beenobtained from the Court by which the Receiver had been appointed, theapplication could not be entertained. The Subordinate Judge gave effect to thiscontention and dismissed the application. We are now invited to hold that theorder of the Subordinate Judge is erroneous on three grounds, namely, first,that no leave was necessary because leave had already been granted to theexecution creditors at whose instance the sale took place; secondly, that ifleave was necessary such leave had been in substance granted by this Court, bytwo orders made on the 7th April 1905 and the 4th May 1908; and, thirdly, thatif leave was necessary and if it be held that leave has not been granted,opportunity should be afforded to the Petitioner at this stage to obtain therequisite leave. In support of the first contention, it has been argued that asleave was granted by this Court to the Roys to proceed with execution of theirdecree against the Mookerjees and the Receiver, it was not necessary for anyother execution-creditor of the Mookerjees to apply for leave in order toenable him to obtain a rateable distribution under sec. 73 of the Code of 1908.It has been argued that the sale-proceeds are in the custody of the Court, andthat, consequently, the grant of the application of the Petitioner for rateabledistribution would not in any way interfere with the possession of theReceiver. In support of this view, reliance has been placed upon the case of Inre Mundslay & Sons and Field [1900] 1 Ch. 602. In our opinion, the view putforward by the Petitioner cannot possibly be supported. It is well settled thata Court will not permit execution against property in the hands of a Receivertill leave has been obtained from the Court by which the Receiver wasappointed. [See the authorities reviewed in the judgment of this Court in thecases of Levina Ashton v. Madhabmoni Dassi 11 C. L. J. 489: s. c. 14 C. W. N.560 (1909) and Jotindra Nath v. Sarfaraj Mia 14 C. W. N. 653 (1910)]. But ithas been contended in this case that the fund against which the Petitionerdesires to proceed is not in the hands of the Receiver, that although itbelongs to the Receiver, it is in the custody of the Court, and, that,consequently, if the application is granted, the principle mentioned will notbe contravened. In our opinion, there is no foundation for this contention. Thecase of In re Mundslay & Sons and Field [1900] 1 Ch. 602 is clearlydistinguishable. There it was ruled that where the Court appoints a Receiverover property out of its jurisdiction the Receiver is not put in possession ofsuch foreign property by the mere order of the Court. Something further has tobe done, and until that has been done in accordance with the foreign law, anyperson, not a party to the action, who takes proceedings in the foreign countryfor the purpose of establishing a claim upon the foreign property is not guiltyof a contempt of Court on the ground of interference with the Receiverspossession or otherwise. The subsequent decisions in In re Derwent RollingMills Company 21 Times L. R. 81 and 701 (1904) and In re West Cumberland Ironand Steel Company [1893] 1 Ch. 713 show, however, that this principle does notapply to cases in which the assets are within the jurisdiction of the Court. Inthe case before us, it cannot be disputed that a portion, of the assets held bythe Court belongs to the Receiver. If the claim of the Roys and the Maharajahof Burdwan, both of whom have obtained leave to proceed against the Receiver,are satisfied, there will still remain a balance which the Receiver will beentitled to withdraw, unless the Petitioner before us is allowed to prosecutehis claim for rateable distribution. It is manifest, therefore, that theprosecution of the application made by the Petitioner must result ininterference with property belonging to the Receiver. Although nominally theproperty in the case before us is in the custody of the Court, there is no roomfor controversy that the Court holds possession for the benefit of the Receiverand is bound to make over the balance to him after the claims of the twocreditors mentioned shall have been satisfied. The view we take is supported bythe decision in Ames v. The Trustees of the Birkenhead Dock 20 Beav. 353 (1855),the principle of which is clearly applicable to the circumstances of the casebefore us. Reference was also made to some observations in the case of In reClarke (7) in which it was ruled that an order appointing a Receiver does notrelate back and that the Receiver must have possession of the goods before theprinciple invoked can be applied. In the case before us, however, as we havealready explained, the funds are held by the Court for the benefit of theReceiver and after the claims of the creditors who have obtained leave aresatisfied, the Receiver will be entitled as a matter of right to take out thesurplus and apply it for the purposes of the litigation in which he wasappointed. Under these circumstances, it is impossible to hold that the Receiverhas not such possession as would entitle him to resist the enforcement of aclaim by a creditor who has not obtained leave to proceed against him. We must,therefore, hold that it was necessary for the Petitioner to obtain leave fromthe Court by which the Receiver was appointed before he could be permitted toprosecute his application against him under sec. 73.

2. In support of the second ground it has been urged thatthe requisite leave has been in substance obtained: and reliance has beenplaced upon two orders made on the Original Side of this Court on the 7th April1905 and the 4th May 1908. The first order was made after the Petitioner hadobtained a transfer of his decree from the Hughly Court to this Court forexecution. The order mentioned was a prohibitory order by which the Receiverwas enjoined not to deal with the properties in his custody, until the furtherorders of this Court. This order must be taken to have been made under sec. 272of the Code of Civil Procedure of 1882 (corresponding to Order 21, Rule 52, ofthe Code of 1908). It is worthy of note that even an order of this descriptioncannot be made without leave of the Court by which the Receiver was appointed[Mahommed Zohuruddin v. Mahommed Noorooddeen I. L. R. 21 Cal. 85 (1893) andKahn v. Alt Mahomed Haji I. L. R. 16 Bom. 577 (1892)]. We are not informedwhether leave was obtained before the order was made; but as the order was madeby the very Court by which the Receiver was appointed, express leave mightperhaps be deemed unnecessary.

3. It is clear, however, that a prohibitory order under sec.272 of the Code of 1882 can in no sense be regarded as equivalent to a grant ofleave to the decree-holder to execute his decree against the properties in thehands of the Receiver. The order merely directs the Receiver not to deal withthe properties until the further orders of this Court; admittedly, no suchsupplemental orders were ever issued. In our opinion, the order must beunreasonably and considerably strained, before it can be interpreted to meanthe grant of leave to the Petitioner to prosecute his application. The secondorder on which reliance is placed is one made on the 4th May 1908. It appearsthat upon the application of the Petitioner, this Court directed the Receiver tosell some of the properties inclusive of those subsequently sold in the HughlyCourt, and then to satisfy the claims out of the sale-proceeds. It has beensuggested that this order is equivalent to the grant of leave to the Petitionerto proceed against the properties in the hands of the Receiver. But the orderin question does not admit of the interpretation suggested. If the Receiver hadproceeded to carry out the order, the sale would have taken place under theguidance of the Court. On the other hand, the sale which has taken place in theHughly Court is not the subject of controversy in this Rule, and the propertyagainst which the Petitioner now seeks to proceed represents the sale-proceedsrealised at that sale. We are of opinion that it would not be right to construethe order of either the 7th April 1905 or the 4th May 1908, as an ordergranting leave to the Petitioner to proceed with execution against theproperties in the hands of the Receiver. It may be pointed out that Courts havebeen generally reluctant to allow execution to proceed against the propertiesin the hands of a Receiver until leave has expressly been granted for thispurpose. This is well illustrated by the case of Mortis v. Baker 73 L. J. Ch.143 (1903). In this case, although a Receiver had been made party to a suitafter leave had been granted to bring an action for recovery of land againsthim, Angel v. Smith 9 Ves. 335 (1804), Hawkins v. Gathercole 1 Drewry 12(1852), In re Batters Estate 31 L. R. Ir. 73, it was ruled that before a writof possession would issue, fresh leave of the Court must be obtained. Minet v.Johnson 63 L. T. 507; 6 T. L. R. 417 (1890). Under these circumstances, we musthold that it is necessary for the Petitioner to obtain express leave entitlinghim to proceed against the property in the hands of the Receiver. Nor can thePetitioner justly complain of any hardship in this matter, for it is not thecourse of the Court to refuse liberty to try a right claimed against itsReceiver, unless it is perfectly clear that there is no foundation for theclaim, Lane v. Capsey [1891] 3 Ch. 411.

4. In support of the third ground, it has been urged thatthe doctrine recognised by this Court in the case of Banku Behari Dey v.Harendra Nath Mukerjee 15 C. W. N. 54 (1910) ought to be extended and that anopportunity should be afforded to the Petitioner to obtain the requisite leaveeven at the present stage of the proceedings. In answer to this contention, ithas been argued on behalf of the Receiver that the application is made toolate, and that leave ought to have been sought at least during the pendency ofthe proceedings in the Court below. In our opinion, there is considerable forcein the contention of the Receiver"; but we are satisfied that, on thewhole, it ought not to prevail, during the pendency of the proceedings in theCourt below, the Court was bound to apply the rule laid down in the case ofPramatha Nath Ganguly v. Khetter Nath Banerjee T. L. R. 32 Cal. 270 : s. c. 9C. W. N. 247 (1904) in which it had been ruled that if proceedings have beencommenced without leave previously obtained, they could not be validated by thesubsequent grant of leave during their pendency. Consequently if even thePetitioners had obtained leave during the pendency of the proceedings in theCourt below, it would have been of no avail, because that Court would have beenobliged to apply the erroneous rule laid down in Ptamatha Nath v. Khetter NathT. L. R. 32 Cal. 270 : s. c. 9 C. W. N. 247 (1904) which has been dissentedfrom only recently in Banku Behariv. Harendra Nath 15 C. W. N. 54 (1910) andMaharajah of Burdwan v. Apurba Krishna Roy 15 C. W. N. 872 (1911). There can,in our opinion, be no doubt that the rule that ought to be applied in thespecial and peculiar circumstances of this case is the one laid down in thecase last-mentioned which is in accord with the view taken in various classesof cases reviewed in the judgment of this Court in the case of Jagat TariniDassi v. Nabagopal Chaki I. L. R. 34 Cal. 305 at p. 311 (1907). Thus upon theauthority of the Judicial Committee in Nawab Muhammad Azmat Ali Khan v.Mussammat Lalli Begum L. R. 9 I. A. 8 (1881), a suit relating to a grant ofproperty within the meaning of the Pensions Act, 1861, need not be dismissed,because no certificate had been obtained before the commencement thereof, butthe suit might be suspended upon an objection that no certificate had beenobtained and might proceed when the certificate had been obtained and deliveredto the Court. A similar principle was adopted by a Full Bench of this Courtwith regard to sec. 78 of the Land Registration Act in Alimuddin Khan v. HiraLall Sen I. L. R. 23 Cal. 87 (1895) and was subsequently extended to casesunder sec. 60 of the Bengal Tenancy Act in Harehkishna Das v. Brindabun Shaha 1C. W. N. 712 (1897), Belchamber v. Nawab Sit Syed Hussan Ali 2 C. W. N. 493(1898) and Abdul Khair v. Meher Ali 3 C. W. N. 381 (1899). The same principlewas applied by the Court of Appeal in Rendall v. Blair 45 Ch. D. 139 (1890) inwhich it was held that where the consent of the Charity Commissioner wasnecessary for the institution of a suit, it was not obligatory upon the Courtto dismiss a suit instituted without such consent; the suit might be stayed toenable the Plaintiff to secure the consent which as a matter of duty ought tohave been obtained in the first instance but is as a matter of fact obtained atlast. A similar principle has also been applied to cases under sec. 4 of theSuccession Certificate Act, Hafizuddin v. Abdool I. L. R. 20 Cal. 755 (1893),Shital Chandra v. Manik Chandra 9 C. L. J. 331 : s. c. 13 C. W. N. 509 (1909),Kammathi v. Mangappa I. L. R. 16 Mad. 454 (1892), Torregrosa v. Pragji I. L. R.16 Bom. 519 (1892), Balkishan v. Wagarsing I. L. R. 20 Bom 76 (1894), BehariLal v. Majid Ali I. L. R. 24 All. 138 (1897). Under these circumstances, we areof opinion that the demands of justice require that the Petitioner should beallowed an opportunity to obtain the requisite leave even at the present stageof the proceeding. The result is that this rule is made absolute, the order ofthe Court below discharged, and the case remitted to the Subordinate Judge whowill proceed to deal with the application on the merits after the Petitionerhas been afforded reasonable opportunity to obtain the necessary leave fromthis Court. As, however, the substantial contentions of the Petitioner, namely,that no leave was necessary, and that if any leave was necessary it had beenobtained, have failed, there will be no order as to the costs of this Rule. Thesale-proceeds will be retained in Court and will not be distributed amongst theother claimants till the present Petitioner has been afforded an opportunity toobtain the leave of this Court.

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Sarat Chandra Banerjee vs. Apurba Krishna Roy and Ors.(29.03.1911 - CALHC)