Skip to content


R.M. Ramaswamy Chettiar and ors. Vs. the Official Assignee of Madras - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported in(1932)62MLJ96
AppellantR.M. Ramaswamy Chettiar and ors.
RespondentThe Official Assignee of Madras
Excerpt:
- - as a matter of fact there was an order and seeing that this was the only objection pressed before him, his order was perfectly right. requirements of section 122 of the bankruptcy act, 1914, are satisfied because there is some matter referred to in the later order. as the order of the 22nd april, 1931 and the letter of request rest upon the order passed on the 15th july, 1930, which as we now understand is a perfectly good order, not only is the order of waller, j. , holding that this court has jurisdiction is perfectly correct. it is perhaps safe to delete that portion, i. , was perfectly right in passing the order......of rangoon in the matter of the insolvency of this firm. this was ordered by the registrar of the rangoon high court on the same day. the order runs thus: 'write letter as usual for such request,' the official assignee of madras applied to this court for an order directing him to act in aid of the official assignee of rangoon in pursuance of the above letter of request and obtained such an order from our brother waller, )., on the 19th january, 1931. but this order was passed ex parte,, i.e., without notice to the insolvents. the official assignee of madras then took out a notice of motion on the 28th january, praying for further directions to the insolvents in respect of filing schedules, delivering properties and executing documents in respect of certain other properties. waller, j.,.....
Judgment:

Vepa Ramesam, Kt., Officiating C.J.

1. The facts out of which these appeals, arise may be thus stated. A Nattukottai Chetti firm, vis., T.S.N. Firm, was adjudicated insolvent by the Rangoon High Court on the 10th March, 1930. On the 15th July, the Official Assignee of Rangoon applied to that Court that a letter of request be issued to the High Court, Madras, directing the Official Assignee of Madras to act in aid of the High Court of Rangoon in the matter of the insolvency of this firm. This was ordered by the Registrar of the Rangoon High Court on the same day. The order runs thus: 'Write letter as usual for such request,' The Official Assignee of Madras applied to this Court for an order directing him to act in aid of the Official Assignee of Rangoon in pursuance of the above letter of request and obtained such an order from our brother Waller, )., on the 19th January, 1931. But this order was passed ex parte,, i.e., without notice to the insolvents. The Official Assignee of Madras then took out a notice of motion on the 28th January, praying for further directions to the insolvents in respect of filing schedules, delivering properties and executing documents in respect of certain other properties. Waller, J., passed an order on the 18th February, 1931. In the statement filed by the insolvents in reply to the notice of motion objection was taken to the jurisdiction of this Court. In paragraph 4 it was contended that the alleged letter of request is ineffective and inoperative and cannot confer any jurisdiction on this Court or on the Official Assignee of Madras as it does not deal with any particular matter and the same is. not in conformity with law. In paragraph 5 it is alleged that the High Court of Rangoon cannot hand over business within its jurisdiction which can properly be dealt with by that Court to another Court. When the matter came on for argument before Waller, J., the objection to jurisdiction seems to have been pressed in a somewhat slightly different form, viz., that no copy of the order required by Section 122 of the English Bankruptcy Act has been produced; but Waller, J., observed: 'I infer from the terms of the letter of request that such an order was passed.' He further observed that there is a presumption that official acts have been properly performed. He also referred to In re Firbank (1887) 4 Mor. 50 to show that the Registrar could pass such orders without reference to the Judge. Finally he held that he had jurisdiction and passed an order directing the insolvents, (1) to deliver to the Official Assignee all their moveable properties in Pudukottah State, (2) to execute in his favour transfers of their immovable properties in that State, (3) to deliver possession to him of their properties, and (4) to file their schedules in two weeks. He observed theat in default warrants will be issued and the insolvents will be committed for contempt. O.S.A. No. 13 is against this order.

2. Later on the matter came on for further hearing before our brother Stone, J., in April last. Objection to jurisdiction was then taken in ;a new form. It was contended that as the letter of request did not deal with any specific matter, this Court had no jurisdiction. Stone, J., seems to have thought that there was something in this but he did not express any opinion on that date. The Official Assignee intimated that he would get a clearer letter of request and would produce the order of the Rangoon High Court. On his communication with the Official Assignee of Rangoon a formal order (in the nature of a decree) was drafted on the 22nd April, 1931, the original order of the 15th July, 1930, being in the nature of a judgment. The order of the 22nd April directs the issue of a letter of request to the High Court of Madras and its officers to act in aid of the Rangoon High Court in realising, reducing to possession, managing, selling, bringing, defending suits, applications, etc., and otherwise dealing with the movables assets of the insolvent firm and its partners in the District Court of South Arcot, Tanjore and elsewhere in the Presidency of Madras, etc. This order also declares that the order of the Registrar, dated 15th July, 1930 and the letter of request, dated 17th July, 1930, were in accordance with the practice of the Rangoon High Court, that the formalities prescribed by law were followed and that the intention of the order and the letter of request was to empower the Official Assignee of Madras to do everything that was necessary in regard to the properties of the insolvents. When this order was produced before Stone, J., he passed an order on the 28th April. In that order he observed that the first letter of request received from the Rangoon High Court was useless and did not confer any jurisdiction on him. Any jurisdiction he could have related to matters directed by the order of that Court and that order to be effective must be an order directing something specific to be done. He was of opinion that it did not refer to anything specific to be done except that it merely referred to a letter of request. He therefore ordered that the Official Assignee should pay the taxed costs of the application to the insolvents. He further held that the order since received was an effective order. At this stage it may be observed that there was no new order passed by the Registrar of the Rangoon High Court after the 22nd April, 1931. The order directing the issue of the second letter of request is still the same old order, namely that which was passed on the 15th July, 1930. The difference was only in the formal order (corresponding to a decree) that was drawn up in pursuance of that order. It does not appear that any formal order was drawn up in the beginning, but now a formal order, dated 22nd April, 1931, has been drawn up which explains the intention of the order of the 15th July, 1930. O.S.A, No. 67 of 1931 is against this last order of Stone, J.

3. Now, coming to the merits of these appeals, the first point argued by the learned Advocate for the appellant--Mr. T.M. Krishnaswamy Aiyar--is that under Section 126 of the Presidency Towns Insolvency Act one Court in British India cannot send a letter of request to another Court in British India. Now, Section 126 provides that all Courts having jurisdiction under this Act shall make such orders and do such things as may be necessary to give effect to Section 118 of the Bankruptcy Act, 1883. Section 118 of the Bankruptcy Act, 1883, is the same as Section 74 of the Bankruptcy Act of 1869 and Section 122 of the Bankruptcy Act of 1914. Under these Acts not only the Bankruptcy Courts in the United Kingdom but also every British Court elsewhere having jurisdiction in bankruptcy or insolvency, and the officers of those Courts respectively, shall severally act in aid of and be auxiliary to each other We are of opinion that Section 122 applies to all the Insolvency Courts in the British Empire, and that it not only authorises one Court in the United Kingdom to aid and get aid from British Courts outside the United Kingdom but also enables two British Courts outside the United Kingdom to aid each other. Therefore it authorises one High Court in British India to aid another High Court in British India, or a High Court in British India to help a Provincial Insolvency Court in British India. And because its main object was this, that Section 126 has been enacted in the Presidency Towns Insolvency Act directing all Courts having jurisdiction under the Act to make such orders and do such things as may be necessary to give effect to Section 118 of the Bankruptcy Act, 1883, and also Section 77 of the Provincial Insolvency Act. We therefore overrule this contention.

4. The next point argued before us is that even if according to the second letter of request this Court has jurisdiction, that jurisdiction begins only from the 28th April, 1931, when the said letter of request was produced, that all acts done prior to that date were done without jurisdiction and that therefore the order of Waller, J., was null and void. It is also contended that all interim orders must be regarded as invalid. Now when we remember that only one order was, passed by the Registrar, namely, the one dated the 15th July, 1930 and that the first letter of request and the second letter of request were issued in pursuance of that order, it is clear that the proper view to take of the first letter of request is that it was somewhat ineffective to inform this High Court of the intentions of the Rangoon High Court. It is perhaps permissible for a Judge here to hold that it was not enough to confer jurisdiction. When the only objection that was pressed before Waller, J., was that the main order itself was not produced, the learned Judge inferred that there must have been such an order. We now know that his inference was right. As a matter of fact there was an order and seeing that this was the only objection pressed before him, his order was perfectly right. When the objection was repeated in a different form before Stone, J., perhaps there was a reasonable doubt as to whether this Court had jurisdiction on the, 13th April. But when the formal order of the 22nd April, 1931, based on the order of the 15th July, 1930, was produced on the 28th April, 1931, before Stone, J., all grounds for doubting the jurisdiction of this Court disappeared.

5. We do not think that there is any substance in the objection that either the order or the letter of request should refer to specific matters. All that Section 122 of the Bankruptcy Act, 1914, says is that an order of the Court seeking aid, with a request to another Court, shall be deemed sufficient to enable the latter Court to exercise, 'in regard to the matters directed by the order, such jurisdiction, etc.' This shows that there must be some matters directed by the order. Now, the judgment of the 15th July did not specifically refer to any matter but it has now been made clear to us by the formal order of the 22nd April, 1931, that the practice of the Rangoon High Court was to pass the order in that form and that it was always taken to mean that the letter of request should relate' to realising, reducing to possession, managing, selling, bringing, defending suits, applications, etc., in respect of the assets of the insolvents. When once the scope of the original order is made clear by the later order, the. requirements of Section 122 of the Bankruptcy Act, 1914, are satisfied because there is some matter referred to in the later order. Even in the first letter of request there is a reference to the 'proprietors of the abovenamed insolvent firm.' By a liberal construction it is possible to say that there was some matter directed in the order. However it is not necessary for us to say that the construction of Stone, J., put on the first letter of request is incorrect. When the later order was produced, all doubts vanished, and there was no question of any specific matter that should have been referred to in the letter of request or in the order. As the order of the 22nd April, 1931 and the letter of request rest upon the order passed on the 15th July, 1930, which as we now understand is a perfectly good order, not only is the order of Waller, J., right but it must be held that this Court had jurisdiction from the very beginning, though it must be said that the matter was cleared up only after the production of the order of the 22nd April, 1931. In this view the final order of Stone, J., holding that this Court has jurisdiction is perfectly correct. It is unnecessary to say anything about the first part of the order as there is no appeal against it.

6. It is suggested that the order of Waller, J., will cause some inconvenience to the insolvents as they have since been adjudicated insolvents in the Pudukottah State and that they are unable to execute conveyances in respect of their immovable properties or to deliver possession. It is perhaps safe to delete that portion, i.e., items (b) and (c) of Waller, J.'s order directing the insolvents to execute transfers in respect of their immovable properties in favour of the Official Assignee and to deliver possession.

7. As regards the movable properties Waller, J., was perfectly right in passing the order. It is now said that some of the properties were destroyed in the recent riots and fire in the Pudukottah State. It is for the insolvents to prove to the satisfaction of the Court that the properties were so destroyed and therefore that there was no default on their part. If any complaint is made about the insolvent's conduct alleging default on their part, the matter must be made the subject of an enquiry and then only it can be found whether they are guilty of contempt so understood. The last part of Waller, J.'s order will be allowed to remain. It is also suggested that it is very inconvenient if the enquiry as to the Cuddalore properties is held in Madras; we leave it to the discretion of the Judge either to refer the Official Assignee to the Cuddalore Court or, while retaining the matter in this Court, to issue commission for examining the

8. Cuddalore witnesses--so as not to cause hardship to the insolvent.

9. The result is that both the appeals are dismissed with taxed costs.

Cornish, J.

10. I entirely agree and only wish to add a few words on the question of jurisdiction which has been argued. I think that Section 126 of the Presidency Towns Insolvency Act enabled the Rangoon High Court to call upon the Madras High Court and its officers to act in aid of it and of the Official Assignee of Rangoon in this insolvency. Section 126 provides that all Courts having jurisdiction under the Act shall make such orders and do such things as may be necessary to give effect to Section 122 of the Bankruptcy Act, 1914, which has replaced Section 118 of the Bankruptcy Act, 1883, referred to in Section 126. Now Section 122 says that the High Court, the County Court, the Courts having jurisdiction in bankruptcy in Scotland and Ireland and every British Court elsewhere having jurisdiction in bankruptcy or insolvency, and the officers of those Courts respectively, shall severally act in aid of and be auxiliary to each other in all matters of bankruptcy. I think the natural meaning of this provision is that not only is a British Court outside the United Kingdom to act in aid of a Court within the United Kingdom, but that it is to act in aid of another British Court elsewhere. To hold that the section only intends reciprocal aid between a Court in the United Kingdom and a British Court elsewhere would be, in my opinion, to put a wholly unreasonable construction on the words in the section. But in order to give the Court whose aid is sought by another Court jurisdiction to act, Section 122 requires that there must be an order of the Court seeking such aid together with a request There was both an order and a letter of request in this case. I think that Stone, J., was justified in his view that the request as at first presented did not sufficiently show what were the matters directed by the order in respect of which the Madras Court was required to act in aid. But the subsequent order and letter of request of the Rangoon High Court made clear what was intended by the first letter of request, and also that the order as originally issued was a valid order. The second letter of request, in fact, merely implemented the first request; and as it was made in pursuance of a valid order, the Madras Court must be regarded as having had jurisdiction from the receipt of the first letter of request to give directions to the Official Assignee to act in aid.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //