1995 PLP 237 (MLD)

A further sum of Rs.2,25,000 was received by the respondent in pursuance to another agreement dated 31‑5‑1973, in terms whereof Ch. Muhammad Ilyas appellant was authorised to manage and to exercise the plaintiff's rights in and draw his share of profit from business of the cinema till such time that,, the said amount of Rs.2,25,000 was paid back in which eventuality his right to manage the business of the cinema and his right to appropriate the share of the plaintiff in the profit of the cinema was to come to an end and possession of cinema was to revert to the respondent‑plaintiff. It was further pleaded that on the death of Ch. Muhammad Hussain, his partnership with the plaintiff came to an end. It is in 1990 that the plaintiff with a view to assume control of the cinema tendered a sum of Rs.2,25,000 to Ch. Muhammad Ilyas through cheque dated 31‑7‑1990 but he refused to accept it. A telegram sent in this behalf also proved abortive and so also a legal notice. Thus permanent injunction was prayed for to restrain the defendant from interfering with the plaintiffs right to conduct the business of the cinema and also a direction was sought for rendition of accounts since August, 1990. Prayer was also made for issuance of a direction to Ch. Muhammad Ilyas to accept the sum of Rs.2,25,000, aforementioned. Alongwith the plaint an application under Order 39, rules 1 and 2 read with Order 40, rule 1, C.P.C. was moved with a prayer that defendants be restrained "from interfering with the rights of the plaintiff to run the business of the cinema or in the alternative to appoint a receiver for the same." Ch. Muhammad Ilyas and others filed their written statement. The application for interim relief was also opposed and it was inter alia pleaded that Ch. Muhammad Ilyas had in a bona fide manner, keeping in view the interest of all the shareholders in the cinema, entered into a lease agreement with defendant No.2 (Mian Arshad appellant in FA.O. No.148/94) who had effected extensive renovation of the cinema which has enhanced its business value and it is only the prospects of lucrative business that led the plaintiff to file the suit which was based on mala fide. It was contended that there was no justification for issuance of temporary injunction or appointment of a receiver. Mian Arshad, defendant No.2 filed his statement and also his reply to stay matter. In the reply to the application he pleaded that he being in possession of the cinema as a lessee up to 30‑6‑1995 in terms of lease deed (copy placed on record) was not liable to render any accounts to anybody and that he having invested lot of money on its renovation and management could not be held to be liable to be ejected without payment of reasonable compensation and that he would suffer irreparable loss if he was deprived of the management by appointment of a receiver.

3. Learned Civil Judge vide order dated 28‑6‑1994, as mentioned above, accepted the application and appointed one Sanaullah Gandapur as a receiver. Hence these two appeals.

4. During the course of hearing at one stage there appeared a possibility of a compromise arrangement pendente litem but ultimately no consensus could be reached between the parties. Hence these appeals are being disposed of on merits.

5. It is contended by Raja Muhammad Anwar, Advocate, learned counsel for Ch. Muhammad Ilyas and others (appellants in FA.O.No.134/94) that the suit was liable to be dismissed as (a) it was hit by various provisions of law i.e. Order 2, Rule 2, C.P.C., proviso to section 42 and section 56 (Clauses I, J, K) of Specific Relief Act; (b) application for appointment of receiver fell far short of requirements as postulated by Order 40, Rule 1, C.P.C.; (c) while deciding the question of appointment of receiver learned Civil Judge has made certain observations in the impugned order which amounted to virtual decision of the main case; (d) respondent failed to show that he had an arguable case and as such stood disentitled to the impugned interim relief.

6. According to the learned counsel, respondent was admittedly out of possession for the last many years and 'he cannot ask for appointment of receiver and thus disturb the lawful possession of the defendants.' He took me through the contents of the two agreements, referred to above, in a bid to pursuade me that since the respondent had not paid the amount of Rs.2,25,000, as stipulated, the property in question would be deemed to be mortgaged with possession in favour of defendants Nos.1, 3 to 5 (defendant No.4 being lessee) and therefore, they were justified to maintain their possession over the cinema till such time the mortgage was redeemed. By making specific reference to the contents of the application for appointment of receiver, it was argued that as there was no allegation of either waste or damage to the property in question, there was hardly any scope for restoring to the extreme step of dispossessing them and appointment of receiver instead. .

7. On behalf of Mian Arshad (FA.O. No.148/94) his learned counsel vehemently argued that though he did not agree with Raja Muhammad Anwar that the suit was hit by Order 2, Rule 2, C.P.C., yet he fully endorsed his other submissions that the suit in its present form was not maintainable. According to him Mian Arshad having invested millions of rupees on effecting improvement in the cinema, as a lessee, was entitled to retain in possession/control till the end of lease period i.e. 30‑6‑1995.

8. On the other hand, learned counsel for respondent argued that he was being illegally deprived of his right to possess and run the business of cinema jointly with Ch. Muhammad Ilyas and others since 31‑7‑1990 and thus being made to suffer huge loss. According to him the normal lease money for the cinema per month was about Rs.2 lacs and the income shown as per alleged lease deed of Rs.30,000 P.M. was clearly as act of concealment of real income.

9. There is no merit in both the appeals. Admittedly no application under Order 7, Rule 11, C.P.C. has been moved by the appellants before the trial Court for rejection of the plaint. All the objections as to the form/maintainability of the suit having already been raised by them in their written statements, the same would be reflected in appropriate issues and evidence would be recorded by the trial Court. Suffice it to say, for the present, that ex facie suit cannot be said to be non‑maintainable, on the various grounds urged before me. The claim of ownership of the respondent at least to the extent of 50% in the cinema is not seriously disputed. It was admitted before me that indeed the sum of Rs.2,25,000 was tendered by the respondent but it was refused as the respondent had yet to make payments for the improvements effected in the cinema (by the lessee Mian Arshad) which "ran into millions of rupees". Thus respondent having offered this amount appeared to have stood discharged of his liability in this behalf in terms of agreement dated 31‑5‑1973. A serious question arises as to whether these defendants could thus legally continue to hold the possession of the cinema to the exclusion of the respondent ad infinitem. At this stage it cannot be said that the plea of the respondent to share the management/control/possession of the cinema has no substance. Another question that may fall for determination before the trial Court would be as to whether a lessee who effects improvements in the leased property without the express permission in writing of the lesson can legally insist to hold the property till such time the lesson compensates him for the alleged improvements. In my view the respondent has succeeded to make out a strong prima facie case.

10. While his learned counsel was making submissions Mian Arshad intervened and stated that he was ready to enhance the lease money to Rs.50,000 per month from the present rate of Rs.30,000.

11. It is true that the relief of appointment of a receiver is to be sparingly granted and with due care and caution as it can create serious dislocation in the existing state of affairs. In my view learned trial Court has exercised its discretion in the matter on sound judicial principles. Prima facie the respondent became entitled to possess. the cinema jointly with defendants Nos.l, 3 to 5 with effect from 31‑7‑1990 when the amount of Rs.2,25,000 was tendered by him and he appears to have been kept out of possession for the last more than four years unjustifiably. Mian Arshad, defendant No.2, the lessee is admittedly a close relation of the other defendants and the plea of the respondent that it is in fact defendants Nos.l, 3 to 5 who are in actual physical control of the cinema on the basis of a sham lease deed in favour of Mian Arshad cannot be said to be devoid of force, at this stage. The contention that these defendants ‑were making secret profits and correct accounts were not being maintained also cannot be brushed aside as i totally frivolous, keeping in view the spontaneous offer of Mian Arshad to increase the lease money to Rs.50,000 per month. In such like situation, the appointment of receiver is eminently just and fair. See Sardar Wali Muhammad v. Sardar Muhammad Iqbal Khan Mokal and others (PLD 1975 Lah. 492 at 499). It is well settled that co‑owners/co‑sharers are in the position of tenants in common and where one tenant in common receives the whole rent to the exclusion of the other from the, share due to him a receiver should be appointed. See Shahzadi Sharif Sultana v. (Brig. Shahzada) Sher Muhammad Jan (PLD 1958 Lah. 288 at 293). In the application for appointment of receiver there is an allegation of wastage and, keeping in view the facts and circumstances of the case, particularly the offer‑of Mian Arshad, the impugned order passed thereupon is not liable to be interfered with.

12. The impugned order is not only legal but also fair and equitable. The entire income of the cinema would be deposited in Court, of course after deduction of his remuneration by the receiver, and the same is to be kept in trust, to be disbursed to the party/parties held entitled thereto as a result of the decision of the case. No prejudice is likely to be caused to any party, which could pursuade this Court to set aside the well‑reasoned order of the learned Civil Judge. Dismissed.

13. It is made clear that the observations made by the learned trial Court in the impugned order about the merit of the case are to be treated to be tentative in character, in the context of decision of the application under reference only, and shall not influence the mind of the Court while deciding the case. 14 Keeping in view the nature of the dispute learned Civil Judge is directed to decide the case positively by 30th September, 1994 and report compliance to Deputy Registrar (Judicial). A.A./M‑1747/L Order accordingly.