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Arunachala Vs. Ayyavu and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Judge
Reported in(1883)ILR7Mad318
AppellantArunachala
RespondentAyyavu and anr.
Excerpt:
insolvency - civil procedure code, sections 351, 352--omission of court to frame schedule--declaration of insolvency no bar to suit to recover debt. - - this right having accrued once, it must be taken to subsist unless it is either satisfied, or exhausted by use, or barred by limitation, or becomes extinct by operation of law......the last clause of section 352, as a decree between the appellant and the respondent regarding the debt in suit. the question then is, whether the omission on the part either of the appellant to prove his debt or of the court to frame a schedule, as required by section 352, has kept alive the appellant's right of suit. the appellant was, as a creditor, originally entitled to put his bond in suit and to obtain a decree, for his right of suit was a necessary incident of the obligation [320] created in his favour by the bond in question. this right having accrued once, it must be taken to subsist unless it is either satisfied, or exhausted by use, or barred by limitation, or becomes extinct by operation of law. neither section 357 nor section 358 has any direct application, for both premise.....
Judgment:

Charles A. Turner, Kt., C.J.

1. The appellant brought this suit upon a bond which the respondents had executed in his favour. As against the second respondent both the lower Courts have decreed the claim, and he has preferred no second appeal. The first respondent, however, pleaded his discharge as an insolvent in answer to the claim, and the question for decision is whether the Judge is right in accepting this plea and dismissing the suit as against him.

2. The first respondent was arrested at the instance of another creditor in execution of the decree in Small Cause 1344 of 1878 on the file of the Subordinate Court at Negapatam. Thereupon he applied under Section 344 of the Code of Civil Procedure to be declared an insolvent, setting forth, in a schedule which he annexed to his application, the appellant's name as a creditor, and the debt now in suit among the pecuniary claims against him. But none of his creditors, including the appellant, appeared either to oppose the application under Section 350 or prove their debts as required by Section 352; and it would seem that, in consequence, no schedule was prepared as directed by that section; and that, although reference is made to a schedule in the order whereby the appellant was discharged as an insolvent under Section 351, the only schedule on record is the one which the respondent attached to his application. There is no doubt that if a schedule had been framed, as directed by Section 352, and the appellant's name entered therein as a creditor, together with the debt due to him, the declaration made under Section 351 would operate, under the last clause of Section 352, as a decree between the appellant and the respondent regarding the debt in suit. The question then is, whether the omission on the part either of the appellant to prove his debt or of the Court to frame a schedule, as required by Section 352, has kept alive the appellant's right of suit. The appellant was, as a creditor, originally entitled to put his bond in suit and to obtain a decree, for his right of suit was a necessary incident of the obligation [320] created in his favour by the bond in question. This right having accrued once, it must be taken to subsist unless it is either satisfied, or exhausted by use, or barred by limitation, or becomes extinct by operation of law. Neither Section 357 nor Section 358 has any direct application, for both premise the existence of a schedule framed under Section 352, whereas, in this case, no such schedule has been prepared. The apparent intention suggested by Section 352 is that there must be a schedule, and that the declaration of insolvency and the insertion of a specific debt, of its amount, and of the creditor's name, in the schedule, are together to have the operation of a decree as regards that debt. In the absence of either there could be no definite decree, and, without such decree, the appellant's right of action cannot be barred. We must at the same time observe that Section 352 gives the insolvent's creditors--at least to those named in his application--no option, as supposed by the District Munsif, to prevent the preparation of a schedule by electing not to prove their debts. The section imposes a duty upon them and upon the Court, and the proper construction to be placed upon it is that the creditors must prove their debts if they intend to dispute the insolvent's statement in his application, and that, on default, the Court ought to frame a schedule with reference to the particulars contained in the insolvent's application, subject, however, to amendment, if any, under Section 353. Although a duty is imposed on the Court, still, under the processual law, it is for the party likely to benefit by its performance to see that it is performed in order that he may claim the benefit conferred upon him by the Legislature. It may perhaps still be open to the insolvent to move the Subordinate Court for rectifying the omission, but on this point it is not at present necessary to express an opinion. It is, however, clear that this suit is not barred either by Section 352 or under any other section contained in Chapter XX of the Code of Civil Procedure.

3. We set aside the decree of the lower Appellate Court in so far as it relates to the first respondent and restore that of the District Munsif. The first respondent will pay the appellant's costs in this Court and in the lower Appellate Court.


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