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AMICUS AI
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
  • Abdur Rahim
  • Odgers, JJ.
Acts
  • section 19 of the Provincial Insolvency Act. Section 18(1) of that Act
  • Section 19 of the Provincial Insolvency Act, III of 1907, Official
  • Act and section 19(2)
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
  • Abdur Rahim
  • Odgers, JJ.
Acts
  • section 19 of the Provincial Insolvency Act. Section 18(1) of that Act
  • Section 19 of the Provincial Insolvency Act, III of 1907, Official
  • Act and section 19(2)
See more information ...
Smart Summary

Judgment Summary — Abdur Rahim, J. (with Odgers, J. concurring)

Factual and Procedural Background

The plaintiffs (the first plaintiff and another who was the grandfather of the fourth plaintiff) received the disputed properties by an exchange from Srinivasa Aiyar on 3 August 1900, but no registered deed was executed, so no effective legal transfer of title was recorded. The plaintiffs remained in possession thereafter. On 29 April 1910 the properties were attached at the instance of Chidambaram Chetti, who had a decree against Srinivasa Aiyar. The plaintiffs filed a claim on 1 October 1910 which was allowed by order dated 1 December 1910.

Chidambaram Chetti then instituted a suit under the Code of Civil Procedure on 21 December 1910 to establish that the properties belonged to his judgment-debtor and to validate the attachment and sale; decree in that suit was passed in his favour on 3 November 1911, and ultimately confirmed by the High Court in Second Appeal on 24 September 1913.

On 3 November 1911 Srinivasa Aiyar was adjudicated insolvent on his own petition. The Official Receiver of the Tanjore District sold the properties to the 1st defendant on 18 November 1915; delivery of possession to the defendant occurred on 15 January 1916 (the judgment records possession being put by Court on or about 16 January 1916). The plaintiffs then instituted the present suit seeking declaration and confirmation of their title and possession, or in the alternative recovery of possession. They succeeded in the Court of trial (District Munsif), but the Subordinate Judge on appeal dismissed their suit. The present appeal challenges that dismissal.

Legal Issues Presented

  1. Whether the plaintiffs' continuous possession from 3 August 1900 (despite absence of a registered deed) founded a possessory/adverse title sufficient to entitle them to recover possession against the defendant.
  2. Whether the sale by the Official Receiver to the 1st defendant conveyed a good title to the defendant—specifically, whether the Official Receiver was duly appointed (by court order as required) so that the property vested in him and could be validly sold.
  3. Whether the attachment (1910) and subsequent proceedings (including the decree and its confirmation) interrupted or otherwise defeated the running of the plaintiffs' adverse possession.

Arguments of the Parties

Appellants' (Plaintiffs') Arguments

  • The plaintiffs had been in actual possession of the properties continuously from 3 August 1900 and thereby had acquired possessory/adverse title sufficient to recover possession, even though no registered deed had been executed.
  • Any interference by the 1910 attachment and subsequent proceedings did not or need not be treated as defeating their possessory title; they relied on authorities (including Narayana Row v. Dharmachar, Ayyaparazu v. Secretary of State, and the doctrine in Asher v. Whitlock) to support the contention that possession could establish title against all except the true owner.

Respondent's (Defendant's) Arguments

  • The defendant asserted title by purchase from the Official Receiver in the insolvency of Srinivasa Aiyar; thus the crucial question was whether the Official Receiver had power to convey good title.
  • It was argued that even though no written order appointing the Official Receiver as Receiver of that particular estate was produced, the Official Receiver had been appointed by the local Government under Section 19 of the Provincial Insolvency Act and had taken possession for years, so a court might reasonably infer appointment or ratification, or that the Court's act of putting the defendant in possession furnished a title.
  • Counsel for the defendant (Mr. T. Narasimha Aiyangar) suggested the Receiver's long possession was evidence of ratification by the Court and that appeals under Section 22 may have been taken, indicating Court cognizance and validation of the Receiver's acts.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Narayana Row v. Dharmachar Supports the proposition that possession can give rise to a possessory title; possession may be effective against all except the true owner. Used to support the plaintiffs' claim that their continued possession could ground recovery of possession against the defendant absent the defendant's valid title.
Ayyaparazu v. Secretary of State Cited in support of the plaintiffs' possessory title proposition (following the doctrine in Asher v. Whitlock). Referred to as additional authority upholding the proposition that possession may complete title in line with the English doctrine cited.
Asher v. Whitlock (English case) English doctrine on completion of title by possession (adverse/possessory title). The court followed this doctrine as laying down the principle that supports recovery by a possessor against one who has no superior title.
Official Receiver of Trichinopoly v. Somasundara Chettiar Holds that property of an adjudicated insolvent does not ipso facto vest in a locally appointed Official Receiver; an order appointing a Receiver is necessary before vesting occurs. Relied upon to conclude that in the present case no valid vesting occurred because no court order appointing the Official Receiver for that estate was produced; therefore the defendant's title failed.
Muthusami Samiar v. Somoo Kandiar (Muthuswamiar v. Somoo Kandiar) Affirms and considers more fully the rule that an order appointing a Receiver is necessary for vesting property in the Official Receiver under the Act. Adopted as supporting authority reinforcing that without an appointment order the Official Receiver could not convey title; the court saw no reason to depart from this view.
A. Ragunathachariar v. Thiruvangada Cited among authorities concerning the effect of attachment/proceedings on adverse possession. Cited by appellant's counsel on the issue of interference with adverse possession, but the court found it unnecessary to decide on those authorities for the present case.
Pandiyan Pillai v. Velshyappa Rowther Cited regarding the effect of proceedings on adverse possession. Mentioned as authority referred to the court; not essential to the decision and not resolved in the opinion.
Phul Kumiri v. Ghanshyam Misra (Privy Council) Privy Council decision bearing on adverse possession and related procedural effects. Cited by counsel but the court stated consideration of it was unnecessary for the decision rendered.
Ramasivami Chettiar v. Mallappa Reddiar Interprets the Privy Council decision in relation to adverse possession issues (Full Bench of this Court). Referenced as part of submissions on adverse possession; the court did not decide the point and therefore did not apply it to resolve the appeal.
Opinion of Mr. Justice Moore in Official Receiver of Trichinopoly v. Somasundaram Chettiar Characterised (by the Subordinate Judge) as possibly an obiter dictum in earlier reporting; part of the discussion on whether practice could justify vesting without a formal order. The court treated the earlier decision and the later confirming decision as binding in principle that a formal appointment order is required; the objection that Moore, J.'s view was obiter did not prevail.

Court's Reasoning and Analysis

The court conducted a two-part analysis: first assessing plaintiffs' possessory claim and second assessing the defendant's title derived from the Official Receiver's sale.

Possessory title / adverse possession:

  • The court accepted the factual finding (from the lower appellate court) that the plaintiffs were in actual possession at least up to 16 January 1916. The plaintiffs remained in possession since the 3 August 1900 acquisition.
  • The court reasoned that even if possession during the period from the 1910 attachment until the High Court's decree of 24 September 1913 were treated as ineffective for completing title by adverse possession (a concession made for argument's sake and not decided), the plaintiffs were still indisputably in possession until 1916 and therefore could rely on their possessory title to recover possession from a person who has no title.
  • The court relied on prior authorities (Narayana Row v. Dharmachar, Ayyaparazu v. Secretary of State) and the English doctrine in Asher v. Whitlock to support the proposition that possession can ground a possessory right against those without title.

Defendant's title via Official Receiver:

  • The court observed that the defendant's asserted title depended on the Official Receiver's power to convey the property. The crucial statutory provisions considered were Sections 18 and 19 of the Provincial Insolvency Act, III of 1907.
  • Section 18 permits the Court to appoint a Receiver at adjudication or afterwards, and upon appointment the property vests in the Receiver. Section 19 provides for local Government appointment of persons as Official Receivers and states that where such an Official Receiver has been appointed for the local limits, "he shall be the Receiver for the purpose of every order appointing a Receiver issued by any such Court" unless otherwise directed.
  • The court interpreted the language of Section 19 (especially the phrase “for the purpose of every order appointing a Receiver issued by any such Court”) in light of prior decisions of this Court and concluded that the property does not vest in a locally appointed Official Receiver automatically; a Court order appointing a Receiver in respect of the estate is necessary for vesting. The court viewed earlier decisions (Official Receiver of Trichinopoly v. Somasundara Chettiar and Muthusami Samiar v. Somoo Kandiar) as correctly construing the statute and adopted their reasoning.
  • Because no written court order appointing the Official Receiver for the estate was produced (and there was no ground to infer any verbal order or ratification), the Official Receiver was not shown to have been in a position lawfully to convey the property. The suggestion that the Court's act of putting the defendant in possession or an inference of ratification could supply a title was rejected; there was no conveyance or document from the Court or empowered officer to that effect.

Conclusion of analysis: The plaintiffs' possessory title was sufficient to recover possession if the defendant lacked title. Because the Official Receiver had not been shown to have been validly appointed by Court order for that estate, the sale to the defendant conferred no valid title. Accordingly, the defendant could not defeat the plaintiffs' possessory claim.

Holding and Implications

Holding: APPEAL ALLOWED. The decree of the Subordinate Judge dismissing the plaintiffs' suit is set aside; the decree of the District Munsif (trial court) is restored. The plaintiffs are entitled to recover possession of the properties from the defendants. Costs were awarded to the plaintiffs here and in the courts below.

Implications:

  • Direct effect on the parties: the defendant was held to have no title arising from the Official Receiver's sale; plaintiffs who were in possession are entitled to recover possession and the successful trial court decree is restored with costs.
  • Broader legal implication as applied in this opinion: the court reaffirmed prior decisions of this Court that, under the Provincial Insolvency Act, property of an adjudicated insolvent is not automatically vested in a locally appointed Official Receiver absent a court order appointing a Receiver for that estate. The opinion treats the existing line of decisions as correctly construing Sections 18 and 19. The judgment does not purport to overrule those authorities.
  • The court did not decide the contested, more complex questions about the precise effect of the 1910 attachment and subsequent decree on the running of adverse possession; the judgment resolves the appeal on the ground that the defendant lacked title from the Official Receiver.

Judges: Abdur Rahim, J. (delivered the principal judgment) and Odgers, J. (concurring). Final order: Appeal allowed; District Munsif's decree restored; costs awarded.

Show full summary ...

    Vythilinga Padayachi v. Ponnuswami Padayachi

    The Judgment of the Court was delivered by

    Abdur Rahim, J.:— The first plaintiff and the grandfather of the 4th plaintiff in this suit obtained the properties in dispute in exchange from one Srinivasa Aiyar on the 3rd August, 1900 but no registered deed was executed as is required by law and therefore there was no effective transfer of title to the plaintiffs. The plaintiffs however remained in possession of the properties since that date. On the 29th April, 1910, they were attached at the instance of one Chidambaram Chetti, who had obtained a decree against Srinivasa Aiyar. The plaintiffs put in a claim on the 1st October, 1910 and it was allowed by an order, dated the 1st December, 1910. Then Chidambaram Chettiar, the attaching creditor, instituted a suit under the provisions of the Code of Civil Procedure to establish that the properties belonged to his judgment-debtor and that he was entitled to attach them and bring them to sale in discharge of his decree. This was on the 21st December, 1910. A decree was passed in that suit in his favour on the 3rd November, 1911. That was ultimately confirmed by the High Court in Second Appeal on the 24th September, 1913. During the pendency of this suit, that is, on the 3rd November, 1911 Srinivasa Aiyar was adjudicated an insolvent on his own petition. Then the Official Receiver of the Tanjore District sold the properties to the 1st defendant in the suit on the 18th November, 1915; and on the 15th January, 1916 the latter obtained delivery of possession of the properties. Soon after the defendant obtained possession the plaintiffs instituted this suit asking for a declaration of their title and for confirmation of their possession of the plaint mentioned properties or in the alternative for recovery of possession of the properties if they were found not to be in their possession. They succeeded in the Court of trial but on appeal the Subordinate Judge dismissed the suit holding that they had not made out their title and were not therefore entitled to a decree.

    2. There were several questions argued before us in support of the plaintiff's title and it seems to us that they are entitled to succeed at least on one of those grounds. They were undoubtedly in actual possession of the properties as found by the lower appellate Court at least till the 16th January, 1916, if they are not in possession now. Conceding for the sake of argument and only for the sake of argument, because it is not necessary to decide the point, that their possession from the date of attachment till the decree of the High Court in the suit instituted by the attaching creditor i.e, till the 24th September, 1913 is ineffective for the purpose of completion of title by adverse possession they were indisputably in possession till 1916 and the defendant was put in possession by an order of Court only on the 16th January, 1916, and if the latter has no title, the plaintiffs are entitled to recover possession from him on the strength of their possessory title. We need only refer to Narayana Row v. Dharmachar(1) and Ayyaparazu v. Secretary of State(2) in support of his proposition following the doctrine laid down in the well-known English case of Asher v. Whitlock(3)

    3. The next question for determination is the defendant's title. That depends on the question whether the sale in his favour by the Official Receiver, Tanjore, conveyed a good title to him or not. That again depends on whether the Official Receiver was duly appointed by the Court as required by law. No order was passed appointing the Official Receiver, the Receiver of the estate in question although the local Government had appointed Mr. Narasimhamurthi Sastri under Section 19 of the Provincial Insolvency Act, III of 1907, Official Receiver of the District.

    4. It has been ruled by two decisions of this Court in Official Receiver of Trlchinopoly v. Somasundara Chettiar(4) and afterwards in Muthusami Samiar v. Somoo Kandiar(5) where the question was even more fully considered that the property of a person adjudicated an insolvent under the provisions of the Act does not ipso facto vest in the Official Receiver who may have been appointed for the local area in which the insolvent is residing but it is necessary that an order should have been passed appointing a Receiver before the property would vest in the local Official Receiver. That is how the phrase “he shall be the Receiver for the purpose of every order appointing a Receiver issued by any such Court” has been construed by two Benches of this Court, and having heard the question fully argued before us I see no reason whatever for holding that this view of the law is wrong.

    5. As pointed out in this view of the law the present practice obtaining in this connection in many Insolvency Courts in the Presidency must be treated as not being in accordance with the law. All the same it is difficult to see how the words of Ss. 18 and 19 can be construed otherwise than they have been by the learned Judges in the cases referred to.

    6. It was suggested that the Act does not require a written order but that we ought to presume from the facts of the case that the Official Receiver must have been appointed a Receiver of this estate, although no written order was passed to that effect. Orders of Court are invariably reduced to writing and in fact there is no ground for supposing; that any verbal order appointing the Official Receiver of this estate was passed. The omission is merely the outcome of an imperfect understanding of the requirements of the Statute. Then it was further suggested that as in the absence of a Receiver, the property of an adjudicated insolvent vests in the Court and the Court in this case directed the delivery of the possession of the property in dispute to the defendant, the defendant acquired a good title from the Court. But there was no conveyance by the Court or by any Officer empowered in that direction by the Court which would have conveyed a valid title to the defendant.

    7. We must therefore hold that the defendant has no title to the property and the plaintiffs who were in possession are entitled to recover possession of the property from the defendants. The result is that the decree of the Subordinate Judge must be set aside and that of the District Munsif restored with costs here and in the Courts below.

    Odgers, J.:— I am also of opinion that the Subordinate Judge is wrong.

    8. My learned brother has dealt with the facts and dates essential to this case. The first argument before us on behalf of the appellants was that the attachment in 1910 does not interfere with the adverse possession of the plaintiffs from the 3rd August, 1900, and that as the first plaintiff remained in possession from the 3rd August, 1900 till he was dispossessed in the year 1915, he had prescribed in a title as against the defendant. With regard to the question of the interference with the adverse possession by proceedings in the claim and in the suit we were referred by Mr. B. Sitarama Rao, for the appellants to several authorities. Some of them it is not necessary to consider as in this case the suit it-self was instituted within 12 years from 1900 before the adverse possession of the plaintiff had become perfected. The suit was in fact instituted on the 21st Decern-bar, 1910. Were it necessary, discussion might arise as to the effect of the cases cited before us viz: A. Ragunathachariar v. Thiruvangada(6), Pandiyan Pillai v. Velshyappa Rowther(7), Phul Kumiri v. Ghanshyam Misra(8) a decision of the Privy Council and the interpretation of that decision by the Full Bench of this Court in Ramasivami Chettiar v. Mallappa Reddiar(9). Apart from this there is the question as to whether the possession of the plaintiff is not good as against all the world excepting the true owner as laid down in Narayana Row v. Dharmachar and the other authorities cited in the Judgment delivered by my learned brother.

    9. However the only question necessary to decide is as to the defendant's title which if any he admittedly acquired by purchase from the Official Receiver in the insolvency of Srinivasa Aiyar. The question is “Was the Official Receiver in a position to convey any title to him”. The learned Subordinate Judge has found as a fact that the Official Receiver was not appointed as Receiver under section 19 of the Provincial Insolvency Act. Section 18(1) of that Act runs as follows: “The Court may at the time of the order of adjudication or at any time afterwards appoint a Receiver for the property of the insolvent, and such property shall thereupon vest in such Receiver.” Section 19 provides for the appointment by the Local Government of such persons as it thinks fit to be Receivers under the Act and section 19(2) runs as follows: “Where any Official Receiver has been so appointed for the local limits of the jurisdiction of any Court having jurisdiction under this Act, he shall be the Receiver for the purpose of every order appointing a Receiver issued by any such Court unless the Court for special reasons otherwise directs”. The important words in this sub-section are “for the purpose of every order appointing a Receiver issued by any such Court”. It is argued that where it is intended to appoint a Receiver under section 16(), the Receiver must be appointed by the Court and unless such an appointment is actually made the person acting as Receiver, if any, acts illegally. Mr. T. Narasimha Aiyangar in his argument for the defendant urged that the Receiver has been in possession of this property for some years and it must be taken if not as a fact in any case as an inference that his acts have been ratified by the Court and that it is probable that under section 22 appeals have from time to time been made against his acts to the Courts and that the Court itself has bad cognizance of the fact that he was in all these matters in insolvency acting as a Receiver. Unfortunately the hardship of the case arising as it may from a technicality cannot be allowed to affect the direct provision of law which I have pointed out and which has been construed by the decisions in The Official Receiver of Tvichinopoly v. Somasundaram Chettiar and Muthuswamiar v. Somoo Kandiar quoted in the judgment of my learned brother. In my opinion the provisions of the act have not in this case been carried out. As pointed out by my learned brother, refuge cannot be taken in the argument that the Court has put the defendants in possession. There is no document of any kind purporting to be executed by the Court on this behalf to the defendants and conveying this property to them. The learned Subordinate Judge gets over this difficulty by saying that the opinion of Mr. Justice Moore in The Official Receiver of Trichinopoly v. Somasundaram Chettiar is only an obiter dictum and apparently the opinion of the Subordinate Judge is influenced by the fact that it has been the practice in the muffusal Courts for the Official Receiver to take charge of properties without special appointment. However there is a more recent case, Muthuswamiar v. Somoo Kandiar which supports the earlier case The Official Receiver of Trichinopoly v. Somasundaram Chettiar. I am therefore unable to see how the express provisions of the act can be avoided. In this view of the case it is unnecessary to decide whether the attachment proceedings and the subsequent suit interfered with running of the adverse possession of the plaintiffs or not I desire to express no opinion on this point.

    10. I agree with my learned brother in that, the present appeal must be allowed and that the judgment of the District Munsif should prevail.

    11. Appeal allowed.

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    Comments

    Vythilinga Padayachi v. Ponnuswami Padayachi
    (Oct 12, 1920)