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Matter No. 7 of 1958, decided on 13th August 1965.

S. 152‑Amendment of order of appellate Court‑Terms of compromise embodied in judgment of appellate Court‑Court of first instance not competent to modify or review order passed by appellate Court.

A. K. M. Siddiq, Official Liquidator in person.

S. C. Bose for the Lessee.

K. A. Baker for the Creditor.

The Official Liquidator filed a petition on the 16th of February 1965, praying for approving the terms of compromise as embodied in the judgment delivered by the appellate Court on 3‑8‑65 and for directing the lessee to comply with the same. The Official Liquidator also filed another supplementary petition on 29th April 1965 for incorporating some additional terms and conditions mentioned in the said supplementary petition in the Memorandum of compromise already filed before the Appellate Court and for approving the same. It appears that Dinajpur Talkies was a Limited Company which was wound up on 28th of December 1956. On 23rd of January 1958 a lease was, granted to cane Hamidur Rahman for 10 years at a rental of Rs. 400 per month for the first five years and Rs. 500 per month for the next five years. The condition of the lease was that the lessee would be allowed to spend up to Rs. 30,000 for repair of the cinema building which sum would be re-payed at the rate of Rs. 200 per month out of the monthly rent of Rs. 400 and at Rs. 250 per month out of the rent for Rs. 500. Prior to this lease, one Abdul Aziz had obtained a decree against the Bank for a sum of Rs. 5,000'which he claimed as a refund of the value of five shares of the Company on the failure of the Company to allot to him any share. After various proceedings the execution case relating to the decree obtained by the said Abdul Aziz was stayed on an application filed on 2nd March 1959, by the Company to the effect that the Liquidator had been appointed by this Court and as such the case was stayed till the liquidation proceedings were complete. The said Abdul Aziz, thereafter, preferred an application under sections 232 and 171 of the Companies Act for declaring the lease as illegal, void and inoperative and for permission to proceed with the execution case filed by the said Abdul Aziz. The matter was heard by Baquer, J. who by his order dated 8th of January 1965, was pleased to hold that the lease was to all ends and purpose a charge and for want of registration with the Registrar was void and the Official Liquidator was directed to take early steps for bringing the property to sell and directed him to take possession of the property under lease. The said Abdul Aziz, however, was not granted the permission to execute the decree as he was held not entitled to any preferential treatment.

An appeal was taken from this decision by the lessee Hamidur Rahman. The appeal was decreed on compromise by the appellate Court, the terms and conditions of the compromise were set forth in the judgment of the appellate Court. It appears that the order of the appellate Court was not drawn up nor were any steps taken for getting the terms of compromise sanctioned by the Company Court. The petitioner the Official Liquidator, filed this petition for approving the terms of compromise as embodied in the judgment delivered by the appellate Court on 3rd of August 1964 and for directing the lessee to comply with the same immediately failing which there was a further prayer by the Official Liquidator for ordering the judgment dated 8‑1‑64 passed by this Court to be enforced. The Liquidator has also prayed in the petition dated 16‑2‑65 as well as in the supplementary petition dated 29th of April 1965 for further direction on some amendments to the decree already passed by the appellate Court. The original petition as well as the supplementary petition is being opposed on the one hand by the said Abdul Aziz and on the other by the lessee.

So far as the position of creditor Abdul Aziz is concerned he has urged that the compromise embodied in the judgment of the appellate Court was not binding upon him and the said compromise is mala fide and detrimental to his interest and that of the other creditors and prayed that the said compromise should be rejected and the Official Liquidator be further directed to act in accordance with the order dated 8‑1‑64. So far as the lessee' Hamidur Rahman is concerned he has contended that the compromise was legal and binding and highly beneficial to the Company and the creditors and submitted that the order dated 8‑1‑64 having merged in the appellate Courts' decision could not independently be enforced and it was the appellate order which is binding upon the parties and further that the new amendments suggested by the Official Liquidator were not called for and were not permissible.

The plea taken by the creditor Abdul Aziz is that the order of the appellate Court was an ex pane order and as such was not binding on him. It appears from the memorandum of appeal filed before the appellate Court, Abdul Aziz was shown as respondent No. 2. It is stated in paragraph 5 of the affidavit‑in- opposition by Abdul Aziz that at the time of hearing of the appeal his lawyer argued the case with the permission of the Hon'ble Judges and opposed the appeal. Subsequently in another paragraph the said Abdul Aziz states that the lessee's lawyer prayed for the withdrawal of the appeal and the creditor was not a party to the compromise and as such the said compromise was not binding on the creditor. The fact that he was shown as a party in the memorandum and the admission in paragraph 5 that his lawyer argued on his behalf before the appellate Court conclusively proves that he participated in the hearing of the appeal and as such now cannot take up the position that the order of the appellate Court is not binding upon him. As stated above, the terms of compromise have been embodied in the judgment of the appellate Court itself. It is only the appellate Court which can modify or review the order passed by it. It is not for me to amend the order of the appellate Court in any way. The position therefore is that the creditor Abdul Aziz is bound by the order of the appellate Court till the same is set aside. This being the position, the said creditor cannot be allowed to contest that the judgment of the appellate Court is not binding upon him. The terms as embodied in the judgment of the appellate Court is not merely those of a compromise between the lessee and the Official Liquidator they are a part of the judgment pronounced by the Court. Therefore, I hold that the creditor Abdul Aziz is bound by the compromise embodied in the judgment of the appellate Court.

Now taking up the position of the lessee to the suggested amendments of the Official Liquidator, I find that the objections of the lessee are well founded. So far as the suggested amendments in prayer 2 of the petition dated 16‑2‑65, I find that the words "other articles" is ejusdem generis of the word "machineries" and the lessee will not be allowed to take away at the end of the period of his lease articles other than those relating to machineries and as such no further direction is necessary on this point.

So far as the suggested amendments in 3(i) of the supplementary position dated 29‑4‑65, is concerned the appellate order clearly provided for the period 1‑2‑63 till 31‑1‑68, presuming that the incidents of the lease referring to the period 1‑2‑58 to 31‑1‑63 bad already been fulfilled in terms of the lease itself. The appellate order was passed in August 1764 and their Lordships approved the terms for the second period with retrospective effect from 1‑2‑63. In these circumstances the Official Liquidator is to conform to the terms of the lease obtainable for the period. The debts of realisation for that period will be in accordance with the terms of the lease otherwise any order contrary to that will operate as an amendment of the appellate Court's order which is beyond my jurisdiction.

With regard to the suggested amendment in paragraph 3(ii), there is no necessity for any further direction inasmuch as the lessee will not be reimbursed of any sum more than Rs. 30,000 (thirty thousand) for repair in terms of the original lease.

So far as the amendment suggested in paragraph 3(iii), as there is no provision in the appellate Court's order, it is to be presumed that the Official Liquidator will himself take steps to take possession of the Rehana Hotel and to realise the dues from the person holding the premises and who are in possession as tenants of the said Hotel and to take all other legal steps in the matter.

So far as the amendment suggested in 3(I)(v) is concerned it is superfluous inasmuch as the lessee knows his rights and limitations. If he exceeds the same the ordinary law of the land sufficiently provides the Official Liquidator with the necessary remedy. '

The same observation holds good for the amendment suggested in 3(v) as the suggested conditions relate to the incidence of the tendency itself.

In these circumstances, the prayer No. 1 in the first petition dated 16th of February 1965, is allowed. The terms of compromise as embodied in the judgment allowed by the appellate Court on 3‑8‑65 is to be carried out. The lessee is directed to comply with the same immediately and the Official Liquidator is directed to take possession of the Rehana Hotel and to take legal steps to realise the dues of the Company from the persons who are in possession of the premises.

Costs of and incidental to this application will come out of the assets of the Company.

K. B. A. Order accordingly.

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