DAMODARAM SANJIVAYYA NATIONAL

LAW UNIVERSITY,
VISAKHAPATNAM, A.P., INDIA

PROJECT TITLE
Appointment of receiver
SUBJECT

NAME OF THE FACULTY

Name- Sunny Raman

Roll Number: -2012106

CONTENTS
OBJECTIVE, RESEARCH METHODOLOGY

CHAPTERISATION
Chapter 1
Introduction

Chapter 2
Problem

Chapter 3
Draft

Chapter 4
Conclusion

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BIBLIOGRAPHY

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OBJECTIVE
The primary aim and objective is to grasp a fundamental understanding of the provision relating
to appointment of receiver and its need and relevance and its working and after doing so, to
attempt a critique based on this understanding. This paper also aims to analyze issues related to
the interpretation and application of the provision related to writ of prohibition and to point out
suggestions if any are required.

RESEARCH METHODOLOGY
The method of writing followed in the course of this research paper is primarily analytical and
the researcher has, for her convenience divided the write up into various parts. The researcher
has used doctrinaire method for his research work. The researcher has followed a Blue Book
(19th Edition) mode of citation throughout the course of this research paper.

Introduction
A 'Receiver' is a person who receives money of another and renders account. Order XL (i.e. 40)
lays down the rules governing the appointment of a receiver, his duties, etc. The purpose of
appointment of receiver is to preserve the suit property and safeguard interests of both the parties
to the suit.1
A "receiver" is an impartial person between the parties to a cause, appointed by the court to
receive and preserve the property (immovable or movable) or fund in litigation pendente lite,
when it does not seem reasonable to the court that either party should hold it. It is a protective
relief. It is one of the harshest remedies as it deprives the opposite party the possession of
property before a final judgment is pronounced.2
\A receiver should not be appointed unless the plaintiff prima facie proves that he has very
excellent chance of succeeding in the suit. Where it appears to the court to be just and
convenient, it may appoint a receiver (before or after the decree) of any property, and remove
any person from the possession/custody of the property. A receiver is an officer/ representative of
the court and he functions under its directions. In exceptional circumstances or for special
reasons, a party to a suit/proceeding (plaintiff or defendant) can also be appointed as receiver.3
The appointment of a receiver is a discretionary power of the court. The power to appoint under
Order 40 is, however, subject to the controlling provisions of Sec. 94, and is to be exercised for
preventing the ends of justice being defeated. The court can appoint a receiver not only on the
application of a party to the suit, but any person who is interested in the preservation of property.
The court can also do so on its own motion.
The court may confer upon the receiver any of the following powers: to institute and defend
suits; to realize, manage, protect, etc. the property; to collect, apply and dispose of the
rents/profits; to execute documents; etc. A receiver cannot sue or be sued for acts done in his
1 P. Lakshmi Reddy v L. Lakshmi Reddy AIR 1957 SC 314
2 Krishna Kumar v Grindlays Bank AIR 1991 SC 899
3 Kasturi Bai v Anguri Chaudhary AIR 2001 SC 1361
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official capacity by a third party without the leave of the court. Property in the hands of receiver
cannot be attached without

the court's

leave. Since

he is

custodia

legis, any

obstruction/interference by anyone with his possession without the court's leave is interference
with the court's proceedings and is liable for contempt of court.
A receiver is the right arm of the court in exercising the jurisdiction invoked in cases for
administering the property; the court can only administer through a receiver. For this reason, all
suits to collect or obtain possession of the property must be prosecuted by the receiver, and the
proceeds received and controlled by him alone.4
A receiver is entitled to the remuneration fixed by the court for the services rendered by him. A
receiver is entitled to be indemnified for the debts incurred or contracts entered into by him in
the course of the management of the estate. A receiver has to furnish security as the court thinks
fit, duly to account for what he shall receive in respect of the property. He has to pay the amount
due from him as per the court's directions. If the receiver fails to submit accounts, or fails to pay
the amount due, or occasion loss to the property by his willful default/negligence, the court may
direct his property to be attached and sold and make good any amount found to be due from him.
The court has an inherent power to remove the receiver appointed by it, when he does not
comply with the orders of the court or abuses his power or authority. A Collector may be
appointed as a receiver in cases where the property in question is land paying revenue to the
Government.
Section 94 summarizes the general powers of the court in regard to interlocutory proceedings. It
lays down that, in order to prevent the ends of justice from being defeated, the court may:
a) issue a warrant to arrest the defendant;
b) direct the defendant to furnish security, to produce any property and place it at the court's
disposal, or order the attachment of any property;
c) grant a temporary injunction, and in case of disobedience, commit . the guilty person to
the civil prison, etc.;
d) appoint a receiver of any property, and enforce the performance of his duties by attaching
and selling his property;
e) make other interlocutory orders.
4 Jagat Tarini Dasi v Naba Gopal Chaki ILR (1907) 34 Cal 305
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Under Section 95, the court, if satisfied that an arrest, attachment or injunction was applied for
on "insufficient grounds", or that there was no reasonable ground for instituting of suit by the
plaintiff, may award against the plaintiff, such amount not exceeding Rs. 50,000, as it deems
reasonable compensation to the defendant for the expense/injury (including injury to reputation)
caused to him. The court, however, cannot award any amount exceeding the limits of its
pecuniary jurisdiction.
Section 95, thus, provides a summary remedy for an injured defendant to enable him to seek
compensation by an application to the court instead of by a suit. An order determining any such
application shall bar any suit for compensation in respect of such arrest, attachment or injunction.

Problem
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Facts
The applicant-plaintiff T. Krishnaswami Chetty has filed in the paper form for a
declaration that the alienations made in favour of defendants, respondents herein,
of the suit houses described as Schedule 'B' to the plaint are not valid and binding,
for mesne profits, for possession and for other reliefs. The applicant-plaintiff T.
Krishnaswami Chetty has in the paper form for a declaration that the alienations
made in favour of defendants, respondents herein, of the suit houses described as
items of Schedule 'B' to the plaint are not valid and binding, for mesne profits, for
possession and for other reliefs.
These properties originally belonged to one Rangiah Chetty, my grand-father who
executed his last will and testament of which probate was also obtained and file of
the Hon'ble Court. Under the said will the testator made a provision for his heirs
including his wife, daughters and daughters' children, so that, the properties may be
enjoyed by them during their lifetime and subsequently by their children absolutely,
but in spite of the intention of the testator and the best care he has taken to secure
the enjoyment of properties for his relations, the properties have now fallen into the
hands of strangers by malpractices of some of the heirs of the testator with the
result while the relations of the testators suffering, strangers who are not \thought
of by the testator are in unjust and illegal enjoyment of the properties for a very
long time. If the respondents are allowed to enjoy the income of the properties
during the pendency of the suit herein, it may be even impossible after the decree
to recover anything from them. Further the respondents are not taking care of the
properties on account of which the houses have fallen into disrepair and they are
not fetching good rent.
This is the fourth suit filed by the plaintiff's family for agitating the rights now
claimed. None of them have been pursued to the end and the latest one is in forma
pauperis. The previous suit C. S. No. 751 of 1948 which was transferred to the City
Civil Court was withdrawn and dismissed on his failure to pay the court-fee due to
Government. Now the valuation has been exaggerated and the suit is filed in forma
pauperis in this Hon'ble Court.

Draft
BEFORE THE HONBLE HIGH COURT, NEW DELHI
IN THE MATTER OF: T. Krishnaswamy Chetty -------------------------------------------------- Applicant
Vs.
C. Thangavelu Chetty And Ors--------------------------------------------Opposite Party
Application under Order XL of Civil Procedure Code for Appointment of receiver in case ref no.
295 of 1953
IT IS HUMBLY SUBMITTED: 1. that opposite party has filed this interlocutory application for the appointment of a
Receiver for these suit properties pending disposal of the suit on the foot of the following
allegations that applicant has made a provision for his heirs including his wife, daughters
and daughters' children, so that, the properties may be enjoyed by them during their
lifetime and subsequently by their children absolutely, but in spite of the intention of the
testator and the best care he has taken to secure the enjoyment of properties for his
relations, the properties have now fallen into the hands of strangers by malpractices of
some of the heirs of the testator with the result while the relations of the testators
suffering, strangers who are not thought of by the testator are in unjust and illegal
enjoyment of the properties for a very long time.
2. That the respondents are allowed to enjoy the income of the properties during the
pendency of the suit herein, it may be even impossible after the decree to recover
anything from them. Further the respondents are not taking care of the properties on

account of which the houses have fallen into disrepair and they are not fetching good
rent.
3. That the parted with Rs. 8,175/- and am in possession as a bona fide purchaser. I have
also obtained rent decree against the plaintiff who is my tenant. Now this suit is brought
to get over all these proceedings and to ignore the family settlement which has to be
construed at the trial. I am advised that it is not necessary at this stage to enter into an
argument on the merits of the legal construction of the will of Rangiah Chetty. It is
enough to state that the parties comprising all the branches of the family have accepted
the arrangement and have been enjoying the properties thereunder.
4. That this is the fourth suit filed by the plaintiff's family for agitating the rights now
claimed. None of them have been pursued to the end and the latest one is in forma paper
is. The previous suit C. S. No. 751 of 1948 which was transferred to the City Civil Court
was withdrawn and dismissed on his failure to pay the court-fee due to Government. Now
the valuation has been exaggerated and the suit is filed in forma paper is in this Hon'ble
Court
5. That in case ref. no. 295/1953 (that is mentioned in annexure) passed in Honble court
passed decree in famous of the application is vide dated 19 th of march 1953 is restraining
the opposite party for difficulties in collecting rent from that party.
6. that the jurisdiction exercised by Courts of equity in administering relief by the extraordinary remedy of a receiver 'pendente lite' is a branch of their general preventive
jurisdiction, being intended to prevent injury to the thing in controversy, and to preserve
it for the security of all parties in interest, to be disposed of as the Court may finally
direct. The power is justly regarded as one of a very high nature, and not to be exercised
when it would be productive of serious injustice or injury to private rights. The exercise
of the extra-ordinary power of a chancellor in appointing receivers, as in granting writs of
injunction or 'ne exeat', is an exceedingly delicate and responsible duty, to be discharged
by the Court with the utmost caution, and only finder such special or peculiar
circumstances as demand summary relief.
7. That the Court, on the application of a receiver, looks to the conduct of the party who
makes the application and will usually refuse to interfere unless his conduct has been free
from blame. He must come to Court with clean hands and should not have disentitled
himself to the equitable relief by laches, delay, acquiescence etc.

Prayer
It is humbly prayed that:
i.

In light of above mentioned facts, this Honble court may be pleased to appoint is

ii.
iii.

under order XL rule i.

The appointment of appropriate receiver by court
To pass that order which court thinks that deemed fit.

Counsel of applicant `

Applicant
Signature

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Conclusion
The Court, on the application of a receiver, looks to the conduct of the party who makes the
application and will usually refuse to interfere unless his conduct has been free from blame. He
must come to Court with clean hands and should not have disentitled himself to the equitable
relief by laches, delay, acquiescence etc. A receiver is an officer of the court that appoints him or
her to take possession, custody, and control of specified real estate and/or personal property,
commonly referred to as the receivership estate, and to dispose of that property through its
sale, abandonment, or other means. The order appointing a receiver must contain the various
items listed along with any other provisions the court deems appropriate. The court may hold an
evidentiary hearing on the motion to appoint a receiver or may rule on the motion based on
arguments of counsel and the papers supporting and opposing the motion.

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BIBLIOGRAPHY

1.
2.
3.
4.
5.
6.
7.

S.M.Mehta, Civil Procedure Code, (1990).

Venkataraman, Civil Procedure Code of 1908, (Vol.2, 1992).
Viswanatha Aiyers Civil Procedure Code, 1908, (Dr. V.K. Chary, et al., Eds., 2000).
C.B. Upadhyay, Digest on Civil Procedure Code, (1989).
C.K. Takwani, Civil Procedure Code, (2000).
Mulla on the Civil Procedure Code, (T.L.V Aiyer Ed., Vol.2, 1992).
Mulla on the Civil Procedure Code, ( J.M. Shelat Ed., year unknown)

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