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Thilla Rukmani Ammal Vs. K.T.A.B. Rajagopala Iyer and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1924Mad839; 84Ind.Cas.281; (1924)47MLJ495
AppellantThilla Rukmani Ammal
RespondentK.T.A.B. Rajagopala Iyer and ors.
Cases ReferredMal v. Chuni Lal I.L.R.
Excerpt:
- .....an insolvent. the learned district judge found that the petitioner was a consenting party to the deed of arrangement executed on 3rd december, 1921, (ex. i) for the benefit of all the creditors and on this ground she was disentitled from filing this petition and dismissed it. the petitioner appeals.2. on the evidence we have no hesitation in finding that the petitioner was a consenting party to the deed. she is a marks-woman but there is evidence to show that she was present and put her mark along with that of another lady. the petitioner is the aunt of the 1st respondent who still lives in her house and it seems to be probable that the petition has been filed in collusion with him.3. the question of law argued for the appellant is that there is a difference between the law in england.....
Judgment:

Ramesam, J.

1. This appeal under Section 75 of the Provincial Insolvency Act arises out of a petition by a creditor to adjudge the 1st respondent an insolvent. The learned District Judge found that the petitioner was a consenting party to the deed of arrangement executed on 3rd December, 1921, (Ex. I) for the benefit of all the creditors and on this ground she was disentitled from filing this petition and dismissed it. The petitioner appeals.

2. On the evidence we have no hesitation in finding that the petitioner was a consenting party to the deed. She is a marks-woman but there is evidence to show that she was present and put her mark along with that of another lady. The petitioner is the aunt of the 1st respondent who still lives in her house and it seems to be probable that the petition has been filed in collusion with him.

3. The question of law argued for the appellant is that there is a difference between the law in England and in India on the question of the disability of a creditor who assented to a deed of arrangement. The contention of Mr. Krishnaswami Iyer is that when Section 9 of the Provincial Insolvency Act now in force (V of 1920) was enacted, the Indian Legislature had before it, the English Act of 1914, but did not choose to enact the clause relating to deeds of arrangement towards the end of Sub-section (1) of Section 4.

4. The right of the creditor to apply for adjudication was dealt with in Section 6 of the Bankruptcy Act of 1883. That section has been adopted by the Indian Legislature as Section 6(4) of the Indian Act III of 1907. The English Consolidating Act of 1914 was then enacted with the additional clause relating to deeds of arrangement after Section 4(1)(d). The Indian Act of 1920, Section 9, was then enacted repeating the language of Act III of 1997. In England, a 'Deed of Arrangement Act was passed in 1887, and another in 1913 and they were consolidated by the Act of 1914 (4 and 5 Geo. Vc. 47).

5. Now in England, it was the established law since 1785 that a creditor who assented to a deed of arrangement could not set it up as an act of bankruptcy, Bamford v. Baron (1788) 2 TR 594 (n). In 1826, the Bankruptcy Act, 6 Geo IV.c. 16 was passed and this was followed by 1 and 2 Will. IV.c.56. It was held that there was no alteration in the law in Marshall v Barkworth (1833) 4 B & Ad 508. In 1849 the Bankruptcy Law Consolidation Act was passed. With reference to that Act, it was held in Ex parte Alsop (1859) I D e F & J 289. that, though a deed of arrangement is an act of bankruptcy so far as non-consenting creditors are concerned, the consenting creditor cannot a petition for adjudication on it. This was followed by Lord Cairns in Ex parte Stray (1867) LR 2 Ch A 374.(See Williams on Bankruptcy Practice, 12 th Edition, p. 4 and Baldwin's and Baldwin's Law of Bankruptcy 9 th Edition, pp. 101-2). On Bankruptcy Act of 1883, we have got the cases of (1906) I KB 377. In re Brindley Sunderland (1911) 2 KB 658. and In re Jones Bros (1912) 3 KB 234. The section of the Bankruptcy Act of 1883 has been adopted in India in 1907 and repeated in 1920 and these decision apply.

6. We do not see how the addition of a clause Section 4 (1788) 2 TR 594 (N) (d) in the English Act of 1914 the effect of which seems to extend the disability to a non-assenting creditor also ' In Cases where he is prohibited from so doing by the law for the time being in force relating to deeds of arrangement' (see Section 24 of the Deeds of Arrangment Act, 1914 according to which any creditor is prohibited form applying, after the trustee under the deed) can affect the law in India. This extension to non-assenting creditors is not available in India and this seems to be the only effect either in England or India as to assenting creditors [see also kheta Mal v. Chuni Lal I.L.R. (1879) A 173].

7. This contention of the appellant is therefore disallowed.

8. His next contention that the District Judge erred in not considering the other grounds alleged in the petition is legally correct, But he seems to have abandoned the other grounds in the Court below and on the facts as disclosed in the case there is no substance in them. The result is that the appeal fails and is dismissed with costs of respondents 2 to 6. It follows that the injunction, dated the 4th October 1922, in C.M.P. No. 2326 of 1922 is dissolved.


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