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isamoddIn AjmoddIn Vs. AjmoddIn Shamsoddin - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case Number Second Appeal No. 594 of 1933
Judge
Reported inAIR1936Bom176; (1936)38BOMLR255
AppellantisamoddIn Ajmoddin
RespondentAjmoddIn Shamsoddin
Excerpt:
provincial insolvency act (v of 1920), section 53 - insolvency-fraudulent transfer -transfer by award-decree transfer within the section-nominal transferor- section operative if real transferor is insolvent.;section 53 of the provincial insolvency act, 1920, refers to ' any transfer ', which includes transfer made by a decree.;a transfer made by a nominal transferee from the insolvent can fall within the purview of the section and can be set aside, where it can be gathered from the circumstances of the case that the real transferor behind the transfer was the insolvent himself and that both the transfers were intended to be part of one transaction. - - - any transfer of property not being a transfer made before and in consideration of marriage or made in favour of a purchaser or..........and the award, dated march 3, 1930, was embodied in the decree, dated march 5, 1930. under that award-decree some of the insolvent's property passed to his brother and sister. two days after the decree the sister, who is now opponent no. 1, transferred what she obtained under the decree to the sons of the insolvent, opponents nos. 2, 3 and 4. the receiver asks that the transfer represented by the decree may be set aside on the ground that the award was fraudulent, and he also asks that the transfer by the sister two days after the decree may also be set aside as fraudulent. in both cases he seeks the aid of section 53 of the provincial insolvency act.2. it is found as a fact that the transfers were fraudulent, and i have no reason to disagree with that conclusion, as fraud is apparent.....
Judgment:

Macklin, J.

1. This second appeal arises out of an application by the receiver appointed in an insolvency petition, under Section 53 of the Provincial Insolvency Act, to have two transfers set aside by the Court. The insolvency was declared on January 31, 1931. But in the previous March there was an award in a partition suit between the insolvent and his brother and sister, and the award, dated March 3, 1930, was embodied in the decree, dated March 5, 1930. Under that award-decree some of the insolvent's property passed to his brother and sister. Two days after the decree the sister, who is now opponent No. 1, transferred what she obtained under the decree to the sons of the insolvent, opponents Nos. 2, 3 and 4. The receiver asks that the transfer represented by the decree may be set aside on the ground that the award was fraudulent, and he also asks that the transfer by the sister two days after the decree may also be set aside as fraudulent. In both cases he seeks the aid of Section 53 of the Provincial Insolvency Act.

2. It is found as a fact that the transfers were fraudulent, and I have no reason to disagree with that conclusion, as fraud is apparent on the face of the award. But it is contended in this appeal that Section 53 of the Provincial Insolvency Act cannot be applied to either of the transfers. That section runs as follows;-

Any transfer of property not being a transfer made before and in consideration of marriage or made in favour of a purchaser or incumbrancer in good faith and for valuable consideration shall, if the transferor is adjudged insolvent within two years after the date of the transfer, be voidable as against the receiver and may be annulled by the Court.

It is argued in the first place that the section refers to ' transfers ' and not to ' decrees ', and therefore, if a decree has been passed, the only remedy would be not by Section 53 but by a suit to have the decree set aside. No authority has been quoted for this argument, and, in my opinion, it is unsound. The section refers to ' any ' transfer, and I do not know why these words should not include a transfer made by a decree. In this case of course the transfer could not be annulled without in effect annulling the decree. But there does not seem to be any reason for not thinking that Section 53 would allow annulment of the decree in such circumstances.

3. The next point taken is that Section 53 deals only with transfers by the insolvent himself and does not permit annulment of transfers made by a transferee of the insolvent. I agree that the section does not provide for transfers by a transferee. But in the peculiar circumstances of this case it is clear that the real transferor behind the transfer, nominally made by the insolvent's sister, was the insolvent himself. The award was dated March 3. It was followed by a decree on March 5, and within two days one of the persons who received the property from the insolvent gave it back to the insolvent's own children. It is obvious that the transfer to the sister by the award and the transfer by the sister to the insolvent's children were intended to be part of one transaction, and it is inconceivable that the insolvent himself was not behind the second transfer. In my opinion the words of Section 53 are wide enough to include the real transferor as distinct from the nominal transferor. Thus the second transfer also can be set aside under Section 53.

4. On both grounds the appeal fails and is dismissed with costs.


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