1. The appellants in this case are the three sons of defendant 2. They, their father and their grandfather, defendant 1, formed an undivided joint Hindu, family. Defendant 2 entered into a partnership with others in business and he and his partners were adjudicated insolvents. The insolvency was terminated by the acceptance by the Court of a scheme of arrangement and the insolvent's property was vested in a liquidator, who proceeded to sell to defendant 3 one-half share in the family property, that is to say, the shares of defendant 2 and of his sons. This is a suit by the plaintiff's against defendant 3 in which they claim that defendant 3 has acquired title not to one half-share of the family property but only to one-eighth, that is the share of defendant 2 exclusively. This contention was upheld by the Court of first instance but has been set aside by the District Judge of South Kanara.
2. The first argument in this second appeal is that there is some distinction between the property of an insolvent which vests in the Official Receiver and the property of an insolvent which, at the termination of his insolvency, vests by the order of the Court in a liquidator. No authority was quoted in favour of this distinction and I can see no grounds upon which it can be based. Clearly a liquidator is vested with the same property as an Official Receiver would get during the administration of the insolvent's estate and that property includes any power which defendant 2, the father, might possess of disposing of the share of his sons.
3. The second and main argument in this appeal was that, because the father was not the manager of the family, he could exercise no power of any kind to dispose of any of the family property. In support of this argument, I have been referred) first of all to a ruling in In re Baluswami Ayyar : AIR1928Mad735 . The question at issue in that case was whether after a partition the power which the father of a family had possessed before partition of selling his sons' shares could pass in an insolvency to the Official Receiver and be exercised by him. Its was held that the filing of a partition suit put an end to the power and that therefore the Official Receiver also, to whom passed only the property of the insolvent, could not exercise it. It was unnecessary in that case to decide whether the father whose power was being discussed was before the partition the manager of the family or not. At p. 430, it is no doubt stated by Ramesam, J. that the basis of a Hindu father's right to sell his sons' share in the joint family property for antecedent debts is twofold, and the second condition laid down is that the property must be joint family property of which the father was the manager. But Ramesam, J. at p. 436 goes on to show that where there are a father and his sons in a joint family, the father is always the manager of his own and of his sons' shares. There can therefore be no support discovered in In re Baluswami Ayyar AIR 1928 Mad 735 for the argument now put forward. The matter has come up again recently before two Benches of this Court in the present year. In the first case, which is reported in Rayalu Ayyar v. Vairavan Chettiar 1936 MWN 866, it was held though, if I may say so with respect, without any detailed analysis of the powers of the father or of the manager of the family, that a father has no right to mortgage his sons' shares in the family property when he is not himself the manager. In the other and later ruling in Shanmukam v. Nachu Ammal AIR 1937 Mad 140, Rayalu Ayyar v. Vairavan Chettiar 1936 MWN 866 is dissented from and a clear distinction is drawn between the power of the father and the power of the manager and it is stated quite positively that there is no justification for any limitation of the father's power to sell his sons' share to satisfy his own debts to a situation in which the father is also the manager. It seems to me with great respect that the decision of the learned Judges in Shanmukam v. Nachu Ammal AIR 1937 Mad 140 is right and that I should follow it.
4. The result is that this second appeal is dismissed with costs of respondent 1. The appellant must pay the court-fees to Government.