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C.L. Narasimam Vs. N. Hanumantha Rao Naidu - Court Judgment

LegalCrystal Citation
CourtChennai
Decided On
Judge
Reported in70Ind.Cas.572
AppellantC.L. Narasimam
RespondentN. Hanumantha Rao Naidu
Excerpt:
provincial insolvency act (iii of 1907), sections 16(2), 47 - civil procedure code (act v of 1908) section 60(1)(iii), 99, 108--insolvency proceedings--receiver, whether necessary party--order made at instance of creditor, legality of--appeal--receiver not made party, effect of--application for allotment of salary of insolvent--rule applicable. - .....altered, a moiety thereof. it will always be open to the insolvent in case any special circumstance should arise to apply to the district court for a modification of this order. the forgoing disposes of the appeals. appeal, against order no. 218 is dismissed with costs and appeal against order no. 251 is allowed with costs.
Judgment:

1. These are appeals, Appeal against Order No. 218 of 1921 by the insolvent and Appeal against Order No. 251 of 1921 by a creditor, against an order of the District Judge of Ganjam on the latter's petition asking for an allocation of the former's salary as translator of the District Court to the Receiver engaged in the administration of his estate for the benefit of the creditors.

2. The appellant in Appeal against Order No. 218 has objected to the lower Court's order on the ground that it was not one under Section 16(2) of the Provincial Insolvency Act, III of 1907, which governs the case, passed on a petition by the Receiver, but on one by a creditor. Reference to the record shows that in fact the Receiver was a party to the proceedings in the lower Court, had notice of them and acquiesced in the order which was made. We are very clear that the principle of Section 16(2) should be invariably observed in insolvency proceedings and that the Official Receiver or Receiver appointed should have the carriage of them, not merely in the lower Court but also in appeal. In the present case, however, it is clear that no prejudice to the Receiver or to the creditors whom he represents, has occurred; and with reference to sections 108 and 99 of the Code of Civil Procedure, read with Section 47 of the Provincial Insolvency Act, we think this objection should not be sustained. The Receiver, it may be added, is not a party to either appeal in this Court. But, as the course we are taking does not prejudice him or the creditors, we do not think it necessary to delay the proceedings in order that he may be joined.

3. On the merits, the lower Court had before it an order, which it describes, and the description is not disputed here, as passed by a former District Judge 'administratively.' The exact nature of this order is not clear. But, fortunately, we need net consider it further, because we are asked to deal with the position of the insolvent only from the date of the petition under disposal. The result of that order, however, was that in 1912, when the insolvent appealed to the compassion of the Court on the ground that he was endeavouring to give one of his sons a University education and to carry on the school education of the others, his appeal was successful, the Court allowing him to retain the whole of his salary to the prejudice of the creditors, the Receiver acquiescing, it would. appear somewhat easily in that decision. In the present petition, the creditor appellant in Appeal against Order No. 251 has asked for a re-consideration of the situation with reference to Section 16(2) of the Provincial, Insolvency Act and Section 60(1)(iii), Civil Procedure Code. Contra it is contended that we should adhere to the previous order on the ground that it was passed with reference to Section 40 of the Provincial Insolvency Act. For the creditor-appellant it is urged that Section 40 is not applicable to this case; but, on the view we take, it is unnecessary for us to deal with that. For we understand the lower Court, in the order under Appeal, with reference to the present state prices in the District and similar considerations, to have allowed the insolvent to retain the pay, which he was getting in 1912, and to have allocated to the Receiver for the creditors the subsequent increase in his pay amounting to Rs. 25.

4. We cannot understand that decision. If the special consideration arising from the insolvent's desire to educate his sons were material, they must long ago have ceased to be so, since that education must by now have been completed. It is impossible to hold that the insolvent cannot live on one moiety of his salary, of which Section 60(1)(iii) authorises the attachment of the other. That is the only and the proper basis for a decision. Adopting it, we set aside the lower Court's order and direct the lower Court to pay each month to the Receiver for the benefit of the creditors Rs. 50 from the insolvent's salary; or, in case the salary shall be altered, a moiety thereof. It will always be open to the insolvent in case any special circumstance should arise to apply to the District Court for a modification of this order. The forgoing disposes of the appeals. Appeal, against Order No. 218 is dismissed with costs and Appeal against Order No. 251 is allowed with costs.


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