Declaration of title and possession affirmed; managing-agency arrangements not treated as prohibited assignment, injunction maintained.

Plaintiff's declaration of title and confirmation of possession of an electric undertaking and its fixtures was upheld; documentary and municipal records and liquidation conduct supported ownership. An arrangement for the Corporation to operate the licensed undertaking with managing agents was held not to constitute a prohibited assignment, so prior-consent rules did not void the agreement. Proof of claim by an unauthorised secretary did not vest the undertaking in the official assignee by reputed ownership; fixtures and buildings were treated as immovable for vesting. Limitation was governed by the rule applicable to immovable property and did not extinguish title before suit. A permanent injunction protecting plaintiff's possession was affirmed.

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Issues: (i) Whether the plaintiff (Indo Swiss Trading Co. Ltd.) is entitled to declaration of title to and confirmation of possession of the electric undertaking and assets described in Schedules 1 and 2 of Annexure A to the plaint; (ii) Whether the arrangement between the licensee and the Corporation contravened Section 9(2) and (3) of the Electricity Act so as to render the agreement (Ex. 23) void; (iii) Whether the Corporation's claim in the insolvency proceedings was validly proved by its secretary and whether the undertaking vested in the official assignee by reason of reputed ownership under Section 52(2)(c) of the Presidency Towns Insolvency Act; (iv) Whether the Corporation's title to the undertaking was extinguished by limitation; (v) Whether a permanent injunction restraining defendants 1 to 4 from interfering with plaintiff's possession should be granted.

Issue (i): Whether the plaintiff is entitled to declaration of title to and confirmation of possession of the electric undertaking and assets described in Schedules 1 and 2.

Analysis: The trial court found that the plants, machineries, power house and related equipment were acquired by and belonged to the Corporation; documentary and municipal records support occupation and ownership by the Corporation; the Company in liquidation and its official liquidator supported the plaintiff's claim; oral evidence for appellants was disbelieved by the trial court and not successfully challenged on appeal.

Conclusion: The plaintiff's title and possession in respect of the properties in Annexure A, Schedules 1 and 2 are confirmed in favour of the plaintiff (respondent).

Issue (ii): Whether the agreement (Ex. 23) was void for want of prior government consent under Section 9(2) and (3) of the Electricity Act.

Analysis: The arrangement that the Corporation would work the licensed undertaking and that Messrs. Lalji and Co. would act as managing agents was communicated to the Government prior to or contemporaneous with operations; the arrangement did not amount to an assignment or transfer prohibited by Section 9(2) and (3) in the circumstances; the Court held the owning of Schedule 2 properties by the Corporation was not in contravention of mandatory provisions of the Electricity Act.

Conclusion: The agreement is not void under Section 9(2) and (3) of the Electricity Act; the contention that the arrangement contravened statutory consent requirements is rejected (against appellants).

Issue (iii): Whether the Corporation validly proved its claim in the insolvency proceedings and whether the undertaking vested in the official assignee by reputed ownership under Section 52(2)(c) of the Presidency Towns Insolvency Act.

Analysis: Evidence showed the secretary, Mr. S. C. Chaudhary, lacked authority to prove the Corporation's debt in March and June 1935; the undertaking comprised fixtures and buildings which, on the material, did not fall within the definition of 'goods' under the cited provision; municipal and other records treated the Corporation as occupier and owner; the point of reputed ownership was not pleaded by appellants below and could not be raised for the first time in appeal in any effective manner.

Conclusion: The Corporation's claim was not validly proved by the secretary in insolvency; the undertaking did not vest in the official assignee under the reputed ownership provision (ruling against appellants on vesting).

Issue (iv): Whether the Corporation's title was extinguished by limitation (Article 49 vs Article 144 of the Limitation Act) before auction or institution of suit.

Analysis: The undertaking was held to be akin to immovable property and governed by Article 144 rather than Article 49; permissive possession becomes adverse only upon refusal to surrender possession; the earliest proved hostile conduct was insufficient to extinguish title before official liquidator obtained possession; subsequent dispossession and interim events prevented extinguishment prior to auction and institution of suit.

Conclusion: The plea of limitation is rejected; the Corporation's title was not extinguished prior to the auction purchase by the plaintiff or institution of the suit (against appellants).

Issue (v): Whether a permanent injunction restraining defendants 1 to 4 from interfering with plaintiff's possession should be granted.

Analysis: The plaintiff obtained a decree for declaration and confirmation of possession; Section 56(b) Specific Relief Act did not bar grant of injunction in the circumstances; the restitution order in Letters Patent Appeal did not preclude the Corporation from a regular suit for declaration and possession; during litigation the State purchased plaintiff's rights and acquired the land, reinforcing that defendants cannot interfere with possession; the trial court's grant of injunction was supported by precedent.

Conclusion: Permanent injunction restraining defendants 1 to 4 from interfering with the plaintiff's possession of the electric undertaking is affirmed (in favour of plaintiff/respondent).

Final Conclusion: The decree of the trial court declaring the plaintiff's title and confirming its possession in respect of the electric undertaking and assets described in Annexure A, Schedules 1 and 2, and granting permanent injunction against the appellants is confirmed; the appeal is dismissed subject to modification that the question of title to certain land need not be executed or finally determined in view of subsequent state acquisition.

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