Crown prerogative priority cannot justify execution outside statutory winding up; leave to levy execution refused.

Application for leave to levy execution on a certificate for recovery of a public demand was refused; the court held that questions of priority between a Crown public demand and other creditors must be resolved within the statutory winding up framework rather than by permitting execution in isolation. The absence of notice to the Official Liquidator and incomplete argument on winding up priority were material, and the Crown's historical prerogative priority does not justify bypassing the statutory scheme where legislative provisions for priority operate. The priority issue is to be adjudicated in the winding up proceedings.

---

---

Issues: Whether leave under section 171 of the Indian Companies Act should be granted to levy execution on a certificate for recovery of a public demand, and whether the Crown's prerogative right to priority prevents restriction by the Companies Act.

Analysis: The application was made ex parte for leave under section 171 to levy execution on a certificate issued for recovery of sums alleged to be due as a public demand under the Indian Mining Settlement Act, II of 1913. The Court observed authorities to the effect that historically the Crown claimed prerogative priority, but later authorities under subsequent legislative schemes indicate that statutory provisions can bind the Crown and displace prerogative priority. No notice was given to the Official Liquidator and the question of priority under the winding up provisions (including section 230) had not been fully argued; on the material before the Court the matter of priority should be decided in the winding up proceedings rather than by granting execution in the present application.

Conclusion: The application for leave under section 171 of the Indian Companies Act to levy execution is refused; the question of priority is to be determined in the winding up.

Ratio Decidendi: A claim to levy execution for a Crown public demand under section 171 must yield to the statutory winding up procedure where the question of priority is to be decided, and the Crown's prerogative priority does not justify execution outside the winding up where the statutory scheme applies.

---