JUDGMENT [ENTITY], J.
1. This is an application for a direction upon the receiver not to sell the vehicle being No. BPH 8479 (old) at present No. WB-37- 1590 as per Order dated 25.9.92, on the basis of the agreement between the parties, the petitioner obtained possession of the said vehicle. On an application made under [SECTION] of the [ACT], receiver was appointed for taking over possession of the said vehicle and, subsequently, the receiver took possession of the said vehicle on 25th September, 1992. [ENTITY], J. as he then was, after hearing of the parties passed inter alia the following order:-
"By consent of the hirer with the financier is settled at Rs. 70,000/- upon payment of sum of Rs. 20,000/-by today, the receiver of his authorised agent will hand over the vehicle bearing No. WB-37/1590 to the hirer, the respondent No. 1. The hirer will pay the balance sum of Rs. 50,000/- by 12 equal monthly instalments @ Rs. 4,000/- and the last instalments of Rs. 2,000/- will be paid by the hirer being the 13th and last instalment. First of such instalment shall be paid on or before 15.11.92 and on 15th of every succeeding calender month. Save and except aforesaid the order dated 5.9.90 will remain the same. This application is thus disposed of."
2. On 25th September the petitioner made payment of Rs. 20.000/- as per order of this court and the receiver handed over possession of the vehicle to the hirer/applicant. The applicant also paid the amount of Rs. 62,000/- as per particulars set out hereinbelow:-
1. 25.9.1992 - Rs. 20,000/-
2. 16.11.1992 - Rs. 4,000/-
3. 21.12.1992 - Rs. 4,000/-
4. 22.12.1992 - Rs. 4,000/-
5. 19.02.1993 - Rs. 5,000/-
6. 6.5.1993 - Rs. 5.000/-
7. 3.1.1994 - Rs. 20,000/-
Total paid Rs. 62,000/-
out of Rs. 70,000/- paid Rs. 62,000/- Balance due Rs. 8,000/-
3. The contention of the applicant is that only a sum of Rs. 8,000/- remains due and payable by the applicant. It is further contention of the applicant that on 19th October, 1994, the respondent (financier) wrongly seized the vehicle and demanded an extra amount of Rs. 90,000/- from the applicant (hirer). The applicant apprehending that there is an attempt to sell the vehicle moved the instant application on 28th October, 1994. It is the contention of the applicant that from the affidavit-in-opposition filed in this proceeding, the applicant came to know that the vehicle, for the first time, has been sold by the receiver. The applicant has specifically contended that the receiver being an officer of the court is not entitled to sell the vehicle without the leave of the court, particularly during the period when the instant application is pending. The contention of the respondent is that the terms of settlement filed by the parties inter alia provided that the receiver would not sell the vehicle in the event of default committed by the applicant in making payment according to the terms of settlement filed by the parties on 5th September, 1990. It has further been contended on behalf of the respondent though the time to make payment of the instalment was extended by an Order dated 25th September, 1992, the said Order, however, clarified that all other terms of the Order dated 5th September, 1992 would remain the same. It has also been submitted on behalf of the respondent that in view of the default committed by the applicant, the receiver took possession of the vehicle according to the terms of settlement on 19th October, 1994. On 22nd October 1994 the receiver advertised for sale of the said vehicle in three newspapers. On 25th October, 1994, the receiver sent a telegram to the applicant intimating him that an offer of Rs. 90,000/- had been received In respect of the said vehicle and that unless the receiver-applicant comes with and higher offer, the receiver would sell the vehicle. The contention of the respondent is that although this application was moved on 27/ 28th October, 1994 before the Vacation Bench, however, no interim Order was passed. The receiver pursuant to the advertisement sold the vehicle on 15th December, 1994. It is the contention of the respondent that in the absence of an interim order, the receiver was justified in selling the vehicle at Rs. 90,000/-. In support of his contention, the learned Advocate for the respondent has relied upon the following decisions :
1) [PRECEDENT] .
2) [PRECEDENT], Admittedly, in the instant case when the application was pending with regard to direction for sale, the receiver being an Officer of the court is not entitled to dispose of the vehicle. The act and conduct of the receiver in disposing of the vehicle, with such unusual haste cannot be supported in any event. The aforesaid decisions relied upon the learned Advocate for the Respondent (Financer) in my view, cannot, have any application to the facts and circumstances of the case.
4. It appears that the Receiver being nominee of the petitioner hurriedly took actions to dispose of the vehicle when the application for injunction was pending, perhaps anticipating that an order may be passed restraining sale of the vehicle. This action cannot be supported. In this connection judgment and decision in the case of [PRECEDENT] relied upon by learned advocate for the applicant may be taken note of. In the aforesaid case the defendant upon receiving notice of motion for injunction to restrain him from building so as to darken the plaintiffs lights, put on a number of extra men, and by working night and day ran up his wall to a height of nearly 40 feet before receiving notice that an ex parte interim injunction had been granted. It appeared to be a question of some nicety whether the lights were ancient lights. It was held on appeal, that this order was right, as the defendant had endeavoured to anticipate the action of the court by hurrying on his building, and that what he had erected ought therefore to be at once pulled down, without regard to the ultimate result of the action.
5. Speaking for the Division Bench [ENTITY], L.J. held and observed inter alia as follows:- "That being so, the defendant upon receiving notice that an injunction is going to be applied for, sets a gang of men to work and runs up his wall to a height of thirty-nine feet before he receives notice that an injunction has been granted. It is right that buildings thus run up should be pulled down at once, without regard to what the result of the trial may be."
6. Observation of [ENTITY], L.J. may also be taken note of in this connection. It was held by him inter alia as follows:- "I am of the same opinion. The questions to be decided at the trial may be of some nicety; but this is not the time to decide them. After the defendant had received notice on Saturday that an injunction was going to be applied for, he set a large number of men to work, worked all night and through nearly the whole of Sunday, and by Monday evening, at which time he received notice of an interim injunction, he had run up his wall to a height of thirty-nine feet. Whether he turns out at the trial to be right or wrong, a building which he has erected the ground that the erection of it was an attempt to anticipate the order, of the court. To vary the order under appeal would hold out an encouragement to other people to hurry on their buildings in the hope that when they were once up the court might decline to order them to be pulled down. I think that this wall ought to be pulled down now without regard to what the result of the trial may be. The appeal will therefore be dismissed.
7. Judgment and decision of our court in the case of [PRECEDENT] relied upon by learned advocate for the petitioner may also be taken note of. In the aforesaid decision the plaintiffs who were joint owners with defendants in respect of the property sued for declaration of title thereto and applied for an Injunction to restrain the defendants from building on the land, and the lower appellate court set aside the temporary injunction granted by the Court of first instance. Setting aside the order of the lower appellate court, the Division Bench held inter alia that this case a substantial portion of the building had been erected after the defendants had become aware of the institution of the suit and of the application for temporary injunction the court would, if necessary, proceed not only to grant a temporary injunction restraining the further erection of the bunding but also to direct that the building already erected be taken down.
8. The aforesaid decisions strongly suggest that in appropriate case the court is entitled to pass a mandatory order of injunction restoring the status-quo ante. Observation of [ENTITY] on 'Injunction' 6th Edn. page 41 may in this connection be also noted. In the aforesaid decision it is stated "but where the injury is of so serious or material a character that the restoring things to their former condition is the only remedy which will meet the requirements of the case, or the defendant has been guilty of sharp practices or unfair conduct, or has shown a desire to steal a march upon the plaintiff, or to evade the jurisdiction of the court, the injunction will issue, notwithstanding the amount of inconvenience to the other party."
9. The further comment of the learned Judge to the following effect may also be noted :- "If the act complained of is continued or carried on after clear and distinct notice that it is objected to, or if during the progress of the action an undertaking has been given to pull down the building if so ordered at the trial, and the injury done is of a serious nature, the jurisdiction will be exercised more freely than in cases where complaint is not made until after the act is completed.
10. It is well settled that the Receiver is an officer of the court. In this connection the following observation of [ENTITY] on the Law relating to Receivers (4th Edn.) at page 63 may be taken note of:
"The Receiver being the officer of the court from which he derives his appointment, his possession is exclusively the possession of the court, the property being regarded as in the custody of the law, in gremio lecis, for the benefit of whoever may be ultimately determined to be entitled thereto."
11. The Supreme Court in the case of [PRECEDENT]. quoted with approval the aforesaid observation of [ENTITY].
The Supreme Court in the case of [PRECEDENT] has also observed that "A receiver is an officer of court and is not a particular agent of any party to the suit, notwithstanding that in law, his possession is ultimately treated as possession of the successful party on the termination of the suit.
12. The Supreme Court in the case of [PRECEDENT] held and observed as follows:-"A receiver appointed under [SECTION] of the [ACT], unlike a receiver appointed under the [ACT], does not own the property or hold any interest therein by virtue of title. He is only the agent of the court for the safe custody and management of the property during the time that the court exercises jurisdiction over the litigation in respect of the property."
13. Judgment and decision in the case of [PRECEDENT] relied upon by learned advocate for the financier does not appear to be of any assistance. The said decision relates to an application contempt of court which was filed against initiation of domestic enquiry relating to misconduct of employee during pending of parallel enquiry before the court in the absence of any stay order. It was held that "the initiation and continuation of disciplinary proceedings in good faith do not obstruct or interfere with the course of justice in the pending court proceeding." The principle decided in the said decision do not, in my view, apply to the facts of the instant case.
14. Judgment and decision in the case of [PRECEDENT] relied upon by learned advocate for the respondent also does not apply to the facts of the instant case. In the said decision, a proceeding for contempt of court was initiated by an employee upon the employer issuing a notice of termination during the pendency of a civil suit filed by the employee. The principles relate to the contempt proceeding and therefore cannot assist the petitioner in any way.
15. It is quite true that a consent order was passed in the instant case, and a terms of settlement was also filed, and the said terms of settlement provided for a default clause and since the applicant financier committed default, default clause because operative and the Receiver took possession of the vehicle allowing for the terms of settlement.
16. It is, however, well settled that although the parties are bound by the terms of compromise and ordinarily time for making deposit in terms of the compromise will not be extended but to prevent manifest injustice, the court would be entitled to grant relief against forfeiture clause provided in the compromise. In the instant case the major portion of the money has already been paid and it would not be proper not to extend the time for making payment of the amount due which the petitioner is all along willing to pay. In this connection, the judgment and decision in the case of [PRECEDENT], may be taken note of. In the aforesaid decision the matter came to Supreme Court in an appeal arising out of an application under [SECTION], the parties entered into a compromise and invited the court to make an order in terms of the compromise which the court did. The Supreme Court in this connection in paragraph 4 of the said judgment at page 431 of the said report Inter alia held and observed as follows:-
"The time for deposit stipulated by the parties became the time allowed by the court and this gave the court the jurisdiction to extend time to appropriate cases. Of course, time would not be extended ordinarily, nor for the mere asking. It would be granted in rare cases to prevent manifest injustice. True, the court would not rewrite a contract between the parties but the court would relieve against a forfeiture clause. And, where the contract of the parties has merged in the order of the court, the court's freedom to act to further the ends of justice would surely not stand curtailed. Nothing said in [ENTITY]'s case militates against this view. We are, therefore, of the view that the High Court was in error in thinking that they had no power to extend the time."
17. Considering the facts and circumstances of the case it appears to me that the receiver being an officer of the court it was not proper for him to sell the vehicle when an application is pending. It may be noted that the vehicle was seized by the receiver for alleged non-payment of outstanding instalment. On 22nd October, 1994 advertisement was issued in newspaper for sale of the vehicle and on 25th October, 1994 a telegram was sent by the financier to the petitioner stating that the vehicle had fetched an offer for Rs. 90,000.00 (Ninety thousand only) and if any higher offer was available, the petitioner should inform the receiver within 7 days; otherwise, the vehicle would be sold.
18. On 27th October, 1994 the instant application was moved before the Vacation Bench for a direction upon the receiver not to sell the vehicle. It has been alleged by the financier that the vehicle has been sold on 15th December, 1994 when the instant application by the petitioner for a direction upon the receiver not to sell the vehicle is pending. It is strange and surprising, how the receiver being an officer of the court without waiting for the court's direction would sell the vehicle in haste. The said sale, in my view, is absolutely unauthorised and the Receiver being an officer of the court should be taken to task for not waiting for the direction of the court and to sell the vehicle on his own or at the instance of the financier and thereby trying to make the pending proceeding infructuous. The receiver being an officer of the court has a duty to court and should obey the direction of the court and should not have proceeded with such unusual haste. The Receiver is directed not to take any further steps in the matter without obtaining direction from this court.
19. Accordingly the sale of the vehicle held on 15th December 1994 stands set aside an cancelled. This order is to be communicated to the Registering Authority, Motor Vehicles Department Barrackpore, forthwith by the Registrar, Original Side of this court.
20. Mr. [ENTITY], learned Advocate who was appointed amicus curie in this matter has rendered very useful assistance.
21. Mr. [ENTITY] Advocate prays for stay of this order/Judgment. Such prayer is refused.
22. Registrar, Original Side of this Court, Receiver, Registering Authority, Motor Vehicles Department, Barrackpore and parties and authorities concerned to act on a signed copy of the minutes of the operative portion of this Judgment and order on usual undertaking.