Jenkins, C.J:— By an instrument of the 23rd of June, 1893, the defendant Vishram Meghji covenanted with the plaintiff that the machinery, engines, plant, stock, implements, utensils, trade fixtures, chattels and effects specified in a schedule thereto should stand charged with, and continue to be a security to the plaintiff for a sum of Rs. 8,000, then advanced, and power was thereby Vested in the plaintiff to sell the same on default in payment.
In March, 1899, while there was still a large sum due to the plaintiff, Vishram filed his petition under the Act for the Relief of Insolvent Debtors, and thereby his assets became vested in the. Official Assignee, who is now represented by Mr. Macleod, the present incumbent of that office.
The Official Assignee contended that the articles specified in the schedule to the instrument were in the possession, order or disposition of the insolvent with the consent of the true owner, and so vested in him. The plaintiff combated this contention, and the articles having by consent been sold, he has brought this suit to establish his right to be paid oat of the proceeds.
The case was heard by Mr. Justice Russell, who decided in plaintiff's favour as to such of the articles as were “fixed” on the ground that they were not goods and chattels, and as to such as were not “fixed” on the ground that the plaintiff was not the true owner. From this decision the Official Assignee has appealed.
Shuttleworth v. Hernaman clearly snows (and it has been conceded by Mr Robertson that the decision of Russell, J., in this case cannot be supported so far as it proceeds on that ground) that the plaintiff was not the true owner of the articles not “fixed.” To that extent therefore the decree must in any case be varied, for these articles were clearly in the insolvent's possession.
It remains then to consider what are the rights of the parties in relation to the fixed articles, but before going into this there is a matter which requires explanation. The evidence on the record as to the extent and purpose of annexation is meagre, and Mr. Robertson has told us how this came about. On the evidence-in-chief of Jamsetji Sorabji, the learned Judge was satisfied that with the exception of three or four articles the plaintiff had made out a primd facie case of the scheduled assets being fixtures, and he intimated this opinion, and that he should so hold unless the defendants by examination or their own evidence established the contrary. Mr. Raikes, it is said, did not quarrel with this, and it was practically taken as proved that with the above exceptions the scheduled assets were fixtures. Mr. Raikes unfortunately is not here, but Mr. Justice Russell's own recollection and his note of Mr. Raikes' argument bear out Mr. Robertson's statement, which I shall therefore take to be correct.
Were the annexed articles, goods and chattels in the possession, order or disposition of the insolvent with the consent of the true owner and was the insolvent the reputed owner thereof within section 23 of the Indian insolvent Act P That Act was passed by the English legislature, and is practically so far as the doctrine of reputed ownership goes, identical in its terms with the earlier English Bankruptcy Acts. Therefore reference to the pertinent English decisions is legitimate and proper.
It has been conclusively established in England that fixtures are not goods and chattels within the rule of reputed ownership. This was decided in the leading case of Horn v. Baker, which has been consistently followed. In illustration of this I may refer to Clark v. Crounshaw; Coombs v. Beaumont; Ex-parte Barclay. The principle is fully discussed by Lord Cranworth in Ex-parte v. Barclay. (His Lordship referred to the judgment in this case and continued.)
This case makes it clear that the fact of the articles being removable by a tenant makes no difference; they still are fixtures to which the doctrine does not apply. In my opinion the same rule should apply in the town of Bombay.
But then it is said that it is a circumstance in favour of the Official Assignee, that the articles were charged by the deed of 1893, apart from the immovable property to which they were annexed. I fail to see how in the reputation of ownership arising out of possession this makes any difference, and that it does not is shown by Whitmore v. Empson.
The case of Ex-parte Sykes was much pressed on us by the Official Assignee in this connection. From the report of the case it would not seem that anything was decided, which the Official Assignee can call in aid, and this view is borne out by a footnote at page 407 of 5 D.M & G., where it is stated, “According to the note which one of the present Reporters took of the case, nothing was decided except that the claim of the plaintiffs was too doubtful to entitle him to the common mortgagee's order in Bankruptcy.”
The conclusion then to which I come is that the annexed articles, located as they were, were not goods and chattels in the possession, order or disposition of the insolvent as their reputed owner, and that they therefore were not in his reputed ownership.
But then it is said, if this be so, the charge was invalid for want of registration, and it is pounded as a necessary dilemma that the articles must either be goods and chattels, or they must be immoveable property, and, if immoveable property, then they would be unaffected by any document, unless duly registered. But do the alternatives proposed exhaust all possible cases? Must a subject-matter be immoveable property within the meaning of the Registration Act, or be subject to the doctrine of reputed ownership? It is clear on the English cases that fixtures, though not goods and chattels within the reputed ownership section, need not be land [Hallen v. Runder; Lee v. Gaskell], Therefore the dilemma does not ex vi termini arise. So here the question whether these fixtures are immoveable property must be decided on the wording of the Registration Act and independently of any conclusion as to their not being goods and chattels under section 23 of the insolvent Act. The Registration Act makes compulsory the registration of all assurances of immoveable property, and so I have to see whether the instrument in suit is such an assurance. Immoveable property is by section 3 said to include “Land buildings, hereditary allowances, rights to way, lights, ferries, fisheries or any other benefit to arise out of land and things attached to the earth or permanently fastened to anything which is attached to the earth, but not standing timber growing crops, or grass.” Of the annexed articles none were attached to the earth; they were at most fastened to that which was attached to the earth. That, however, is not enough; they must have been “permanently fastened.” The evidence, as I have already said, is meagre as to the extent and intention of annexation, but looking to the fact that the insolvent who erected them was only a monthly tenant I am unable to hold that they were permanently fastened; on the contrary, I think they were not. Therefore section J 7 of the Registration. Act does not apply.
I therefore think that to the articles which were not “fixed” the Official Assignee has a good title. They would be those numbered 9, 10, 11 and 18 in the schedule: to the rest he has no title.
The chatties for the purpose of this decree being by consent taken to be of the value of Rs. 750, we declare that the Official Assignee is entitled to that sum with such interest as may have been raised in respect thereof and that the plaintiff is entitled to the balance of the fund in the Official Assignee's hands, and decree accordingly.
We do not disturb the Judge's order as to costs, but the respondent will only get half his costs of the appeal.
Attorneys for plaintiff—Messrs. Payne, Gilbert and Say ant and Moos.
Attorneys for the Official Assignee (defendant 1)— Messrs. Mansukhlal, Damodar and Jamsetji.