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Ponnammai Ammal Vs. the District Official Receiver and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported in(1926)51MLJ228
AppellantPonnammai Ammal
RespondentThe District Official Receiver and anr.
Cases ReferredJagannadha Aiyangar v. Narayana Aiyangar
Excerpt:
- - viii was not for value or in good faith. i must therefore also stand good......a.a.o. no. 178, the document attacked in this case, is ex. ix. the only evidence for the official receiver regarding it is p.w. 2, whose evidence strikes us as much inferior to that of p.w. 5, who is in no way related to the insolvent. the latter swears that money was paid on the mortgage. there is no evidence that about the date of mortgage palavesa kone was in insolvent circumstances and anxious to screen his property from pressing creditors. we consider that there is no ground for holding that ex. ix is a transfer in fraud of creditors. ex. ix ripened into a decree and that decree was transferred by ex. viii to 4th respondent. there is no finding by the judge that ex. viii was not for value or in good faith. on the merits we see no reason why exs. viii and ix should be.....
Judgment:

1. The Official Receiver is not represented. A.A.O. No. 178, the document attacked in this case, is Ex. IX. The only evidence for the Official Receiver regarding it is P.W. 2, whose evidence strikes us as much inferior to that of P.W. 5, who is in no way related to the insolvent. The latter swears that money was paid on the mortgage. There is no evidence that about the date of mortgage Palavesa Kone was in insolvent circumstances and anxious to screen his property from pressing creditors. We consider that there is no ground for holding that Ex. IX is a transfer in fraud of creditors. Ex. IX ripened into a decree and that decree was transferred by Ex. VIII to 4th respondent. There is no finding by the Judge that Ex. VIII was not for value or in good faith. On the merits we see no reason why Exs. VIII and IX should be declared void as against the Official Receiver.

2. A.A.O. No. 179 of 1923 :-The judgments on the merits in this case follows the above. If Ex. IX is a genuine mortgage then the consideration for Ex. I is wholly genuine, as the learned Judge has found that the balance of the consideration apart from Ex. IX was actually paid. Ex. I must therefore also stand good.

3. A.A. 0. No. 129 of 1923 :-The transfer from the insolvent in this case is Ex. X. Though no doubt there was a sale by him to his son-in-law the only evidence in this case is that the sale amount was paid; here also there is no evidence that at the time of Ex. X the insolvent was in such circumstances that he would be anxious to secrete his property from his creditors. We consider the evidence adequate to uphold Ex. X. That being upheld, the Official Receiver cannot attack Ex. XI, the transfer by the vendee under Ex. X to 5th respondent. These documents, therefore, must also stand.

4. A legal point as to the scope of Section 53, Provincial Insolvency Act of 1920, has been taken before us, viz., that under it the Official Receiver is not at liberty to attack a transfer from a transferee of the insolvent. The language of the section favours this view since it is the 'transferor' who is the insolvent. This view is supported by a ruling reported in Sudha v. Nanak Chand Daulat Ram (1925) vii L L.J. 160 and the ruling of Oldfield, J. in A.A.O. No. 159 of 1918 reported in Jagannadha Aiyangar v. Narayana Aiyangar (1919) 52 I.C. 761. We are inclined to agree with the remarks of the latter on this point in that judgment including the ground on which he distinguishes the English cases cited by him but may point out that in both the cases In re Vansittari: Ex parte Brown (1893) 2 Q.B. 377 the transfer was upheld and not set aside as Oldfield, J. states. A more recent case In re Hart: Ex parte Green (1912) 3 K.B. 6 has been cited to us, which carries on the principle laid down in the II Q.B. cases and applies it even to a case where the transfer from the original donee from the insolvent was subsequent to the act of bankruptcy. We need not however pursue the matter further here.

5. We allow the appeals and set aside the Lower Court's order in toto and dismiss the Official Receiver's petitions with costs throughout in all the three cases.


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