Umade Raja Raje Damora Kumara Venkatalingama Nayanim Varu v. Inaganti Venkatarama Rao And Others

The order, which is in question before us, was passed in a suit instituted by the plaintiff, the predecessor of the present Rajah of Kalahasti for the recovery of certain villages from the defendant and for other reliefs. Those villages had been originally usufructuarily mortgaged and thereafter a document was executed purporting to be a deed of sale in favour of the 1st defendants adoptive father one Rajah D.K. Seshachalapathi Nayanim Varu. The 2nd defendant is the widow of that gentleman and the 8th defendant is a supplemental defendant who claims to be entitled to the rights of the 1st and 2nd defendants under a purchase or assignment. A receiver was appointed by consent of parties, that is, the plaintiff and the 1st defendant. When the 6th defendant came on record he made an application for the discharge of the receiver mainly on the ground that he had acquired the rights of the 1st and 2nd defendants, that there was no longer any dispute which would lead to mismanagement or waste, and that there fore the continuance of the Receiver became unnecessary. The learned Subordinate Judge accepted this view of the situation and passed an order discharging the Receiver. It is contended by the learned Advocate General that since the Receiver was appointed by the consent of the parties he could not be discharged until the termination of the proceedings. It is, however, the law, as laid down in Kerr on Receivers, page 287, that if in the course of the proceedings, the continuance of a Receiver became unnecessary, he will be discharged This proposition finds support in Bainbridge v. Blair ([1841] 3 Beav. Rep., 421 at p. 424) where Lord Langdale, M. R. says: What I have to consider is that one party ought to have proper protection, and the other ought not to be unnecessarily charged with the costs of a receiver and I think I ought not to continue the Receiver, if I am satisfied that he may be discharged without injury to the legatees. The question then comes to this: whether sufficient reliance can be placed in the trustees on whose affidavit the Receiver was discharged. In this case, we think, that, since the 8th defendant (1) is willing to furnish security for the future rents and profits of the property for two years, (2) undertakes to pay the peishcush due on the villages to the extent of Rs. 10,000 a year from the current fasli 1330 and for future faslis and (3) also undertakes to keep and file accounts regularly in Court once every six months on account of these villages, it is no longer necessary to charge the estate with the expenses of a Receiver. On these terms therefore we confirm the order of the Lower Court. The Lower Court will ascertain what the future profits are likely to be and take security in accordance with its finding within two months from the date of such ascertainment.