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Subramania Aiyar Vs. T. V. Krishna Aiyar and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1927Mad701
AppellantSubramania Aiyar
RespondentT. V. Krishna Aiyar and anr.
Cases ReferredSankaranarayana Pillai v. Rajamani A. I. R.
Excerpt:
- .....is whether the official receiver of an insolvent's estate has power to sell the interest of the insolvent's sons in the family property the question has been already decided in this court in official assignee of madras v. ramachandra aiyar a. i. r. 1923 mad. 55 where it was held that although the interest of the sons does not vest in the official assignee by reason of the adjudication it would be competent to the latter to deal with their shares if the debts of the insolvent were of such a nature as to be binding on their interests. again in sankara narayana pillai v. rajamani a. i. r. 1924 mad. 550 to which i was a party, it was held that the sale by the official receiver purporting to be of the whole of the family estate of the insolvent passed to the vendee the sons,' share also......
Judgment:

Phillips, J.

1. The question we have to consider, is whether the Official Receiver of an insolvent's estate has power to sell the interest of the insolvent's sons in the family property The question has been already decided in this Court in Official Assignee of Madras v. Ramachandra Aiyar A. I. R. 1923 Mad. 55 where it was held that although the interest of the sons does not vest in the Official Assignee by reason of the adjudication it would be competent to the latter to deal with their shares if the debts of the insolvent were of such a nature as to be binding on their interests. Again in Sankara Narayana Pillai v. Rajamani A. I. R. 1924 Mad. 550 to which I was a party, it was held that the sale by the Official Receiver purporting to be of the whole of the family estate of the insolvent passed to the vendee the sons,' share also. It is now contended for the appellant that in view of the recent decision of the Privy Council in Sat Narain v. Behari Lal these cases require reconsideration. In this last case, which was under the Prosidency Towns Insolvency Act, it was held that Section 2 (e) did not include the sons' interests in the family property when the father had been adjudged an insolvent and that the interests of the sons did not vest in the Official Assignee. Their Lordships remark that

it is certainly a startling proposition that the insolvency of one member of the family should of itself and immediately take from the other male members of the family their interests in the joint property.

2. Inasmuch as Section 2 of the Act is only to apply unless there is something repugnant in the subject or contest, it was held that the disposing power mentioned in Section 2 (e) contemplates an absolute and unconditional power of disposal. They, therefore, held that under the definition of 'property' in Section 2 (e) the interests of the sons did not vest in the Official Assignee under Section 17. They, however, remark:

it may be that under the provisions of Section 52, or in some other way that property may in a proper case be made available for payment of the father's just debts.

3. This remark clearly indicates that their Lordships had no intention of overruling either of the two Madras decisions I have mentioned above. Although the decision was under the Presidency Towns Insolvency Act, it is hardly possible now to contend that it would not apply to the Provincial Insolvency Act, with which we are here concerned. The definition in Section 2 (e) of the latter Act, is identical with the definition in the former. Although, therefore, their Lordships refer in their argument to Section 52 of the Presidency Towns Insolvency Act, a section which is missing in the Provincial Insolvency Act, yet it must be taken that the two sections being identical must have the same meaning and that the disposing power in both must be an absolute disposing power, although the question whether a father's right to enforce partition of the family property is an absolute power has not been considered. Apart, however, from Section 2 it appears to me that the question before us can be decided with reference to Section 28 under which the whole of the property of the insolvent shall vest in the Court on the making of an order of adjudication. Section 2 is not an exhaustive definition of 'property' and if this power of the father to sell his sons' interests can be deemed to be property within the meaning of Section 28, then the power vests in the Court or in the Official Receiver, although the property over which the power has to be exercised does not so vest. It is contended for the appellant that this power of a Hindu father is not property within the meaning of the Act, and he relies on the Common Law interpretation of 'power.' It is very clearly laid down in ex parte Gilchrist-In re Armstrong [1886] 17 Q. B. D. 521 that a general power of appointment is not property and it is, therefore, argued that the power of a Hindu father is not property. The English Law deals with powers which are created by deed or testamentary dispositions, and it is impossible to say that such powers are in any way analogous to the powers of a Hindu father over the joint family property. No such powers are known to the English Law and they are creations not of deed or testament but of the Hindu Law. There seems, therefore, to be no reason why the word 'property' in the Insolvency Act should be held to exclude the disposing power of a Hindu father. Apart from this, under the English Bankruptcy Act, Section 15, the power of disposing of property is specifically mentioned as one of the forms of property which vests in the trustee in bankruptcy. Similarly Section 52 of the Presidency Towns Insolvency Act provides that the property of the insolvent divisible amongst his creditors shall comprise among other things,

the capacity to exercise and to take proceedings for, exercising all such powers in or over or in respect of property as might have been exercised by the insolvent for his own benefit at the commencement of his insolvency or before his discharge.

4. If, therefore, the English Bankruptcy Act and the Presidency Towns Insolvency Act treat this power as the property of the insolvent, there must be vary strong reason for holding that the same word 'property' in the Provincial Insolvency Act has a different meaning and excludes such powers. On this ground I think that it must be held that the power of a Hindu father over the family property must be deemed to be 'property' within the meaning of the Act and as such to vest in the Court or the Receiver. If it is so, the Receiver can exercise such powers and, in doing so, sell the interests of the insolvent's sons.

5. This conclusion may also be put on the ground adopted in Official Assignee of Madras v. Ramchandra Aiyar A. I. R. 1923 Mad. 55 namely that when the Official Assignee stands in the shoes of the insolvent he can alienate the minor sons' interest a in the joint property for the purpose of paying the insolvent's debts unless the debts in question were incurred for illegal or immoral purposes. The same principle was applied in Sankaranarayana Pillai v. Rajamani A. I. R. 1924 Mad. 550 There are only two decisions since the decision of the Privy Council in Sat Narain v. Behari Lal namely, Khem Chand v. Narain Das A. I. R. 1925 Lah. 41 and Shripad v. Basappa A. I. R. 1925 Bom. 416 In the former it was held that the Official Receiver is competent to proceed against all the co-parcenary property, because he represents all the creditors and his position is similar to that of a judgment-creditor who can attach and sell the co-parcenary property to recover the debts incurred by the father. That is yet another ground for supporting the conclusion already arrived at. With all respect, therefore, I am not prepared to accept the decision in Shripad v. Basappa A. I. R. 1925 Bom. 416 to the contrary, which is a mere ipso facto unsupported by argument.

6. For all these reasons the sale by the Official Receiver must be upheld and this appeal dismissed with costs.

Madhavan Nair, J.

7. I have had the advantage of reading my learned brother's judgment with which I agree. The reasoning of the judgment in Sat Narain v. Behari Lal would show that that decision would apply equally to adjudication under the Provincial Insolvency Act also. But in view of the observation

that the case must be decided on the wording of the Presidency Towns Insolvency Act, and that Act alone,

8. I do not think that their Lordships of the Privy Council intended that an extended application should be given to their decision. The judgment does not deal with the cases decided in this country under the Provincial Insolvency Act. Further, Section 52, C1. 2 (b) of the Presidency Towns Insolvency Act on which their Lordships place much stress does not find a place in the Provincial Insolvency Act. As pointed out by my learned brother their Lordships remark:

It may be that under the provisions of Section 52 or in some other way, that property may in a proper case be made available for payment of the father's just debts,

9. would indicate that their Lordships did not intend to overrule either Official Assignee of Madras v. Ramchandra A iyar A. I. R. 1923 Mad. 55 or Sankaranarayana Pillai v. Rajamani A. I. R. 1924 Mad. 550.

10. I agree with the order proposed by my learned brother.


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