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Budhsen Vs. Asharfi Lal and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtAllahabad
Decided On
Reported inAIR1938All28
AppellantBudhsen
RespondentAsharfi Lal and ors.
Excerpt:
- - we are satisfied however that the intention of the legislature was not to allow a second appeal on every question which might arise between the parties in insolvency proceedings. r 1935 bom 80. if it were held that all questions of whatsoever nature were included in the provisions of section 4, then clearly certain of the provisions of section 75(1) of the act would be rendered nugatory.thom, ag. c.j.1. this is a second appeal from an order of the learned district judge of bareilly in an insolvency matter. the appellant was declared insolvent, and finally a scheme was propounded by the official receiver, which scheme received the approval of the insolvency court and of the district judge in appeal.2. learned counsel for the appellant has contended that in the scheme a higher rate of interest is allowed on the debts than is permissible under the provisions of the provincial insolvency act. in the view we take of this case, it is not necessary for us to make any pronouncement upon this point. learned counsel for the respondents took the preliminary plea that no appeal lay to this court. in support of this contention he referred to the pro-visions of section 75, provincial.....
Judgment:

Thom, Ag. C.J.

1. This is a second appeal from an order of the learned District Judge of Bareilly in an insolvency matter. The appellant was declared insolvent, and finally a scheme was propounded by the Official Receiver, which scheme received the approval of the Insolvency Court and of the District Judge in appeal.

2. Learned Counsel for the appellant has contended that in the scheme a higher rate of interest is allowed on the debts than is permissible under the provisions of the Provincial Insolvency Act. In the view we take of this case, it is not necessary for us to make any pronouncement upon this point. Learned Counsel for the respondents took the preliminary plea that no appeal lay to this Court. In support of this contention he referred to the pro-visions of Section 75, Provincial Insolvency Act, Section 75(1) provides that:

The debtor, any creditor, the receiver or any other person aggrieved by a decision come to or an order made in the exercise of insolvency jurisdiction by a Court subordinate to a District Court may appeal to the District Court, and the order of the District Court upon such appeal shall be final.

3. Section 75 further provides however that any such person aggrieved by a decision of the District Court on appeal from a decision of a Subordinate Court under Section 4 may appeal to the High Court on any of the grounds mentioned in sub Section (1) of Section 100, Civil P.C. For a certain class of oases, provision is made for a second appeal to the High Court. The terms of Section 4, Provincial Insolvency Act, are very wide. Sub-section (1) is as follows:

Subject to the provisions of this Act, the Court shall have full power to decide all questions whether of title or priority or of any nature whatsoever, and whether involving matters of law or of foot, which may arise in any case of insolvency coming within the cognizance of the Court, or which the Court may deem it expedient or necessary to decide for the purpose of doing complete justice or making a complete distribution of property in any such case.

4. Learned Counsel for the appellant contended that the term 'or of any nature whatsoever' was sufficiently wide to cover 4he question which has arisen in the present case. He urged that if the District Judge approves of a scheme under which a higher rate of interest is awarded than is permissible under Section 48 of the Act, a second appeal will lie to this Court in view of the Proviso to Section 75 above referred to. We are satisfied however that the intention of the Legislature was not to allow a second appeal on every question which might arise between the parties in insolvency proceedings. Certainly the term 'or of any nature whatsoever' is a very wide en le. It must however, in our judgment, he read in conjunction with the earlier part of the section which refers to questions whether of title or priority and with the opening words of the section 'subject to the provisions of this Act.' In other words, in our opinion the term 'or of any nature whatsoever' must be subject to the limitation of ejusdem generis, or to the limitation to orders not specifically provided for in the Act. This view of the law has been taken in Mohammad Sadiq v. Chuni Lal (1934) 21 A.I.R. Lah. 807 and Gopikabai Mahadeo v. Chapsi Purshottam (1935) 22 A.I.R 1935 Bom 80. If it were held that all questions of whatsoever nature were included in the provisions of Section 4, then clearly certain of the provisions of Section 75(1) of the Act would be rendered nugatory. In our opinion, the question which is raised in the present case is not one in respect of which an appeal lies from the District Court to the High Court.

5. Learned Counsel for the appellant invited us to entertain his appeal as an application in civil revision. He contended that in view of the provisions of Section 48, Insolvency Act, no Court had jurisdiction to approve of a scheme which provided for a rate of interest higher than six per cent. Learned Counsel referred us to the schedule on the record in which the rates of interest approved of are set out. It is clear however from the information before us on the record that while a higher rate of interest than six per cent, has been allowed in regard to a number of the debts, in at least three there has been a reduction of the rate of interest from 24 per cent, to 14 per cent. The learned District Judge in the course of his order has referred to the obstructive and recalcitrant attitude which the appellant has assumed throughout these proceedings. Taking all the facts and circumstances into consideration, though the rate of interest allowed in respect of certain of the debts due may be higher than permitted by the provisions of the Insolvency Act, we do not consider that this is a case in which we should exercise our jurisdiction in revision. In the result, the appeal is dismissed with costs.


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