Under the Code of Civil Procedure (CPC), the concept of a receiver allows the court to appoint a neutral and impartial person to manage and preserve the property or assets that are the subject of a dispute.
Appointment of a Receiver (Order 40 CPC)
The court has the power to appoint a receiver in certain circumstances where it deems it necessary to protect and preserve the property in dispute. The appointment of a receiver is an equitable remedy aimed at safeguarding the interests of the parties involved.
Purpose of Appointment
The primary purpose of appointing a receiver is to ensure the proper custody, management, and preservation of the property pending the final determination of the case. The receiver acts as a custodian of the property and carries out specific functions as directed by the court.
Role and Functions of the Receiver (Order 40 CPC)
The receiver’s role and functions may vary depending on the specific circumstances of the case and the court’s directions. Generally, the receiver has the following responsibilities:
- Taking possession and control of the property or assets in dispute.
- Managing and administering the property in accordance with the court’s directions.
- Collecting rents, profits, or other income generated by the property.
- Maintaining and preserving the property in good condition.
- Making periodic reports to the court regarding the status and condition of the property.
Powers of the Receiver (Order 40 CPC)
The court may confer certain powers on the receiver to facilitate the proper management of the property. These powers can include the power to collect rents, execute leases, carry out repairs, pay expenses, or take legal action on behalf of the property.
Liability of the Receiver (Order 40 CPC)
The receiver is accountable to the court and the parties involved. The receiver must act diligently, honestly, and in the best interests of all parties. Any misconduct or breach of duties by the receiver may result in their removal and potential liability for any losses caused.
Termination of Receiver’s Appointment (Order 40 CPC)
The court may terminate the receiver’s appointment upon the final determination of the case or by specific order if it deems it appropriate. At the termination of the receiver’s appointment, the property is usually returned to the party entitled to it or dealt with as per the court’s directions.
