1. This is a first appeal from order brought by the Jalaun, District Co-operative Bank at Oral. A person called Ram Dayal was adjudged an insolvent in the Court of the District Judge of Jhansi. The appellant bank was owed a debt by Ram Dayal and the bank obtained permission of of the board of revenue to sell an eight pies amindari share of the insolvent in, a certain village called Paretha in Bundel Khand. The bank did not take permission, from the insolvency Court. Ram Dayal made an application to the insolvency Court alleging that such permission was necessary before the bank could sell his property. The Court below has held that the bank can sell property but that as soon as the property is sold the price becomes the property of the insolvent under Section 28(4), Provincial Insolvency Act, and that this price then vests in the receiver, and that the Co-operative Bank has no priority over other creditors and that the money would be distributed, among other creditors. The bank argues in first appeal that under Section 28(5), Provincial Insolvency Act, the property of the insolvent for the purposes of that section shall not include any property which is exempted by any agreement from liability to attachment and sale in execution of a decree. Under the Bundelkhand Land Alienation Act, the zamindari share of Ram Dayal is so exempted. Clearly therefore this share is not property within the meaning of Section 28 and therefore under Section 28(2) the zamindari share did not pass to the receiver in insolvency and the section does not prevent the bank from taking steps in regard to it. Now Sub-section (4) states:
All property which is acquired by or devolves on the insolvent after the date of an order of adjudication and before his discharge shall forthwith vest in the Court or receiver and the provisions of Sub-section (2) shall apply in respect thereof.
2. I do not consider that on the sale of the zamindari property it can be correctly stated that the price is acquired by the insolvent or devolves on him. It appears to me that as the bank has a legal right to sell the zamindari property under the Co-operative So cieties Act, (Act 2 of 1912), the sale price of the property will go to the bank and cannot be considered as being acquired by or devolving on the insolvent. I understand Section 28, Sub-section (4), Provincial Insolvency Act, to refer to property which the insolvent acquires by his own efforts, such as his wages or salary, or to property which devolves on him by rule of law, such as by inheritance. I do not think that the sub-section, is intended to apply to a case like the present where property which docs not come under the section is sold by some one who has a right to sell it. If the argument of the lower Court were correct then the same argument might be applied to the case of a secured creditor who sells the property of the insolvent on a mortgage and it might be said that as soon as the property was converted into cash by an auction sale then the cash-ought to go to the receiver. For these reasons I consider that the order of the lower Court is incorrect in directing that as soon as the property is sold its price becomes the property of the insolvent and that it will vest in the receiver and that the money will have to be deposited in the insolvency Court for distribution to the other creditors.
3. I allow this appeal with costs in both Courts. The appellant Co-operative Bank will be permitted to retain the proceeds of the sale to the extent of this debt and it need only deposit with the receiver any excess of the sale proceeds over the amount due to the Co-operative Bank including, costs.