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Ex Parte Ragavaloo Chetti and anr. Vs. in Re Rangiah Chetti. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Judge
Reported in(1892)ILR15Mad356
AppellantEx Parte Ragavaloo Chetti and anr.
RespondentIn Re Rangiah Chetti.
Cases Referred and Samalbhai Nathubhai v. Someshvar Mangal and Harkisan I.L.R.
Excerpt:
insolvency - 11 & 12 vic., cap. 21, sections 9, 92--petitioning creditors' debt--joint debt. - .....there is nothing repugnant to the rest of the section in such a reading, in the case of a single debt jointly due to several persons. in section 48 the words occur 'person and persons who would be a creditor,' and similarly section 9 might be read in the case of joint creditors 'persons being a creditor.' this seems to us the most reasonable construction to put upon the section. the other construction involves this, amongst other anomalies, that joint creditors, who are partners in trade, would be able to obtain an adjudication if their debt is rs. 500, whereas joint creditors, who are not partners, would not be able to do so, unless their debts are rs. 700 in the case of two and rs. 1,000 in the case of three. there seems absolutely no reason for this distinction. in the present case.....
Judgment:

1. We cannot agree with the learned Commissioner in Insolvency that petitioners are not entitled, under Section 9 of the Insolvent Act, to petition for an adjudication of insolvency against their debtor. It appears to us that the construction put by the learned Judge upon Section 9 would prevent a Hindu joint trading family, or, indeed, any other joint creditors from obtaining an adjudication of insolvency whatever were the amount of their debts, for, in our opinion, the two last classes of persons named in the section, as entitled to apply, are intended to be separate creditors, whose debts amount, in the aggregate, to Rs. 700 and Rs. 1,000, respectively, and not joint creditors to whom one debt is due. In our view the object of this part of the section is to prevent a debtor from being harassed in respect of single small debts or a number of petty debts coming to a small amount in the aggregate. This object is attained by providing that proceedings for adjudication as an insolvent, shall only be taken in respect of single debts, whether due to a person or a partnership, amounting to Rs. 500 or of separate debts amounting to Rs. 700 or Rs. 1,000, in the aggregate, according as the petitioning creditors are two or three in number. There seems no reason, having regard to the object of the provision, why joint creditors should be in a worse position in respect of one debt due to them than they would be if they were a single creditor in respect of the same debt. And we think the definition clause of the Act, Section 92, does allow the word ' person ' in Section 9 to be read as ' persons,' and that there is nothing repugnant to the rest of the section in such a reading, in the case of a single debt jointly due to several persons. In Section 48 the words occur 'person and persons who would be a creditor,' and similarly Section 9 might be read in the case of joint creditors 'persons being a creditor.' This seems to us the most reasonable construction to put upon the section. The other construction involves this, amongst other anomalies, that joint creditors, who are partners in trade, would be able to obtain an adjudication if their debt is Rs. 500, whereas joint creditors, who are not partners, would not be able to do so, unless their debts are Rs. 700 in the case of two and Rs. 1,000 in the case of three. There seems absolutely no reason for this distinction. In the present case the debt is due on a promissory note in favour of the petitioners jointly, and, we think, they come within the first class of persons named in Section 9 as entitled to obtain an adjudication of insolvency.

2. We are disposed also to think that they come within the second class 'partners in trade.' Members of a Hindu joint trading family may not be, in all respects, partners within the definition in the Contract Act, but it does not follow that they may nob be partners for the purposes of Section 9 of the Insolvent Act. That they are partners in some sense has often been held. See Ram Lai Thakursidas v. Lkahmichand Muniram 1 Bom. H.C.R. App. 51 and Samalbhai Nathubhai v. Someshvar Mangal and Harkisan I.L.R. 5 Bom. 38. But it is not necessary to decide that question now, as we hold that petitioners are entitled to apply for an adjudication of insolvency as joint creditors whose debt exceeds Rs. 500.

3. The order of the Insolvecy Court must be set aside and the petition remanded to the learned Commissioner for disposal on the merits. Costs to abide the event.


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