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Muhammad HusaIn and anr. Vs. Ilahi Bakhsh - Court Judgment

LegalCrystal Citation
CourtAllahabad
Decided On
Judge
Reported in17Ind.Cas.92
AppellantMuhammad HusaIn and anr.
Respondentilahi Bakhsh
Excerpt:
.....to show his property as belonging to another. - - the ground given for the rejection of the petition is that it was not presented in good faith and that the appellants' object was not really to surrender their property and to be cleared of their debts, but to evade payment by setting up a title in their father to certain property against the receiver and to avoid imprisonment for debt. the district judge said that he was not satisfied that the petitioner was unable to pay his debt. it appears to me that actions of this kind on the part of a debtor or the suspicion or belief that such action is contemplated by a debtor is not a good ground for dismissing a debtor's petition in insolvency. moreover, on the evidence, i think, that it is not safe to hold on the evidence now on the..........from his father and brothers and his object was to 'prevent his creditors from touching certain family property of which he was, in fact, the manager. the district judge had dismissed the petition on the ground that it was an abuse of the process of a court and had relied on my decision in girwardhari v. jai narain 32 a. 645 : 7 a.l.j. 835 : 7 ind. cas. 39 in the course of which i said that an insolvency petition might be dismissed if it was presented not with the bona fide view of obtaining an adjudication but, for an inequitable or collateral purpose. but this court held that the petition ought not to have been dismissed. it seems to me impossible to distinguish the present case from that case. here the district judge thinks that the object of the debtors is to prevent their.....
Judgment:

Chamier, J.

1. This is an appeal against an order of the District Judge of Gorakhpur, rejecting the petition of the appellants to be declared insolvent. The ground given for the rejection of the petition is that it was not presented in good faith and that the appellants' object was not really to surrender their property and to be cleared of their debts, but to evade payment by setting up a title in their father to certain property against the Receiver and to avoid imprisonment for debt. In appeal, it is contended that the case is covered by a decision of two Judges of this Court in F.A.F.O., No. 33 of 1912, delivered on May 31st last. In that case, the same learned District Judge had dismissed the petition of a debtor to be declared an insolvent on the ground that he had falsely pleaded that he was separate in estate from his father and brothers and his object was to 'prevent his creditors from touching certain family property of which he was, in fact, the manager. The District Judge had dismissed the petition on the ground that it was an abuse of the process of a Court and had relied on my decision in Girwardhari v. Jai Narain 32 A. 645 : 7 A.L.J. 835 : 7 Ind. Cas. 39 in the course of which I said that an insolvency petition might be dismissed if it was presented not with the bona fide view of obtaining an adjudication but, for an inequitable or collateral purpose. But this Court held that the petition ought not to have been dismissed. It seems to me impossible to distinguish the present case from that case. Here the District Judge thinks that the object of the debtors is to prevent their creditors from obtaining satisfaction of their claims out of family property. Indeed, the only possible distinction between the two cases is that the former case was the case of a Hindu family, and the present case is the case of a Mahomedan family. But as the members of this Mahomedan family are said to be carrying on a soap business jointly, there is really no distinction between the two cases. In the cases of Kali Kumar Das v. Gopi Krishna Rai 15 C.W.N. 990 : 12 Ind. Cas. 48 the petition of a debtor to be declared insolvent had been dismissed on the ground that the debtor had not produced the account-books of his business and had not satisfactorily explained the omission, and there were other grounds for doubting whether the petitioner had truly disclosed all the material facts. The District Judge said that he was not satisfied that the petitioner was unable to pay his debt. But the High Court set aside the order of the District Judge, observing that the fact that the Judge was unable to satisfy himself that the petitioner was unable to pay his debt, was not a ground for dismissing the petition. The case before me and the cases in this Court and the Calcutta High Court, to which I have referred, are cases of a very common type. A person, who petitions to be declared insolvent, not unfrequently, at some stage or another of the proceedings, endeavours to keep back a portion of his property or pretends that property which belongs to him does not belong to him. It appears to me that actions of this kind on the part of a debtor or the suspicion or belief that such action is contemplated by a debtor is not a good ground for dismissing a debtor's petition in insolvency. Such cases are easily distinguished from the cases referred to by me in Girwardhari v. Jai Narain 32 A. 645 : 7 A.L.J. 835 : 7 Ind. Cas. 39 in which the petitions were dismissed because they had been presented for inequitable or collateral purposes. Moreover, on the evidence, I think, that it is not safe to hold on the evidence now on the record that the appellants in this case are interested in the soap business carried on by their father. Further evidence will, no doubt, be available hereafter, and what I say now must not be treated as a decision of the question. Far the above reasons, I am of opinion that this petition ought not to have been dismissed, I allow this appeal, set aside the order of the District Judge and direct that the record be returned to him in order that the case be disposed of according to law.


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