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(Allu) Ramalinga Ayyar Vs. Malli N.M. Subba Ayyar (Dead) and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1933Mad168
Appellant(Allu) Ramalinga Ayyar
RespondentMalli N.M. Subba Ayyar (Dead) and ors.
Cases ReferredRamalinga Ayyar v. Rayadu Aiyar
Excerpt:
- .....has proved his debt within the meaning of section 78, provincial insolvency act. a certain malli firm filed a suit claiming an amount against the appellant. during the pendency of the suit, the appellant applied to be adjudicated an insolvent, and the insolvency court appointed an interim receiver to take possession of his properties. thereupon, the plaintiff, malli firm, applied to the court where the suit was pending, that the interim receiver might be brought on the record. that application was refused and eventually a decree was passed in favour of the plaintiffs. that decree contained a clause which ran thus: 'the plaintiff may prove their debt in insolvency.'2. some time after the passing of the decree, the appellant was adjudicated an insolvent. then the decree was.....
Judgment:

1. The question that this appeal raises is, whether the respondent has proved his debt within the meaning of Section 78, Provincial Insolvency Act. A certain Malli firm filed a suit claiming an amount against the appellant. During the pendency of the suit, the appellant applied to be adjudicated an insolvent, and the Insolvency Court appointed an interim receiver to take possession of his properties. Thereupon, the plaintiff, Malli firm, applied to the Court where the suit was pending, that the interim receiver might be brought on the record. That application was refused and eventually a decree was passed in favour of the plaintiffs. That decree contained a clause which ran thus: 'The plaintiff may prove their debt in insolvency.'

2. Some time after the passing of the decree, the appellant was adjudicated an insolvent. Then the decree was assigned by Malli firm in favour of the present respondent. We are now concerned with what happened subsequently. He applied to the insolvency Court, that he might be recognized as the insolvent's creditor, in the place of Malli firm. In the affidavit which he then filed, he stated expressly, that the decree directed that the claim was to be proved in insolvency. The insolvency Court directed notice of this application to the insolvent, to the assignors and to the Official Receiver. The Court finally made an order directing the respondent's name to be substituted for that of Malli firm.

3. The short question to decide is, whether the debt on these facts is to be deemed as proved or not. Mr. Ramaswami Aiyengar strongly contends, that the Act prescribes by Section 49, a special mode of proof and unless that mode is strictly followed, a debt must not be held to have been proved. This contention is, in our opinion, untenable. We must look to the substance and not to the form of the thing. The respondent, as we have pointed out, specially referred to the fact, that the decree contained a direction that the debt should be proved. What was his object in referring to this direction, unless he meant to convey that he was then seeking to prove the debt? Where a creditor obtained a decree after the debtor's adjudication, in the presence of the Official Receiver, it was held that the debt should be deemed as proved, although the formal mode prescribed by Section 49 was not followed: Ramalinga Ayyar v. Rayadu Aiyar : AIR1930Mad356 . The facts of the present case bring it within the principle underlying that decision. We therefore hold that the debt has been proved and that Section 78 applies. The appeal fails and is dismissed with costs.


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