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Sailendra Krishna Roy and ors. Vs. Rashmohan Shaha and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1929Cal703
AppellantSailendra Krishna Roy and ors.
RespondentRashmohan Shaha and ors.
Excerpt:
- .....the creditor on whose application the order was made, in the form prescribed for affidavit and proof of debt had proved his debt about seven years ago. various things happened. he was treated as a creditor while certain negotiations for composition were going on he was a member of the committee of inspection and so on. it does not appear that section 25, schedule 2, presidency towns insolvency act, has been complied with by the official assignee and it further appears that so far as the insolvency rules of the court go no time is limited within which the official assignee is obliged to comply with the provisions of that rule. the official assignee does not question the proof of debt, but the proof of debt itself is not formally and in writing admitted. in these circumstances it is.....
Judgment:

Rankin, C.J.

1. This case arises out of an order made by my learned brother Pearson, J., refusing to interfere with an order made by the Registrar in Insolvency refusing to review an order made by him for the attendance of certain persons to be examined under Section 36, Presidency Towns Insolvency Act, 3 of 1909. The merits of the case and the necessity for holding the enquiry proposed seem plain enough ; but the point which is relied upon on , behalf of the appellant is a technical point. Section 36 begins in this way:

The Court may, on the application of the Official Assignee or of any creditor who has proved his debt, at any time after an order of adjudication has been made, summon before it in such manner as may be prescribed the insolvent or any person known or suspected to have in his possession any property belonging to the insolvent, or supposed to be indebted to the insolvent or any person whom the Court may deem capable of giving information respecting the insolvent, his dealings or property ; and the Court may require any such person to produce any documents in his custody or power relating to the insolvent, his dealings or property.

2. On that it appears that this insolvency is a very old one the order of adjudication having been made on 9th August 1921. The creditor on whose application the order was made, in the form prescribed for affidavit and proof of debt had proved his debt about seven years ago. Various things happened. He was treated as a creditor while certain negotiations for composition were going on he was a member of the committee of inspection and so on. It does not appear that Section 25, Schedule 2, Presidency Towns Insolvency Act, has been complied with by the Official Assignee and it further appears that so far as the insolvency rules of the Court go no time is limited within which the Official Assignee is obliged to comply with the provisions of that rule. The Official Assignee does not question the proof of debt, but the proof of debt itself is not formally and in writing admitted. In these circumstances it is said that the phrase creditor 'who has proved his debt' in 8. 36 does not include this creditor because it is said that until the claim is formally admitted the creditor is not a creditor who has proved his debt. That proposition is laid down in the decision of Greaves, J., reported in Abdul Samad, In re A.I.R. 1923 Cal. 305 and the learned Judge definitely holds that the phrase that:

a creditor who has proved his debt means not merely a creditor who has lodged proof of his debt but a creditor whose proof 'has been admitted by the Official Assignee under the provisions contained in Section 25, Schedule 2, Insolvency Act.

3. I am of opinion that the decision of Greaves, J., is erroneous and ought not to be adhered to. The ordinary meaning in bankruptcy of 'a creditor who has proved his debt' is a creditor who has done all that the Act requires the creditor to do and in Schedule 2, English Act, this is made perfectly clear because the Section 2, Schedule 2 says that:

a debt may be proved by delivering or sending through this post in a prepaid latter to the Official Receiver or if a trustee has beer appointed, to the trustee, on affidavit verifying the debt.

4. When the creditor has done that, he is said to be a creditor who has proved his debt. Whether the proof is admitted or not is a question entirely different from the question whether the creditor who has done his part can be said to have proved. It is true that the language in the Presidency Towns Insolvency Act has been altered and apparently it is a possible view that the draftsman was not content to copy the--language which is found in the English Statute from which the Indian Statute is an abridged transcript, because it says that:

a proof may be lodged by delivering an affidavit verifying the debt.

5. At the same time it has to be remembered that the phrase 'creditor who has proved him debt' is to be regarded in the light of the context. We find for-example Section 48 of the Act, says:

with respect to the admission and rejection of proofs and other matters referred to in Schedule 2, the rules in that schedule shall be observed.

6. It is clear that proof is one thing and admission or rejection is another and I am not prepared to bold that it is a reasonable construction of the language to deny to the phrase 'a creditor who has proved his debt' its ordinary English meaning. If the debt has been proved then in that case the question may arise at a meeting of creditors whether, by reason of the provisions of Schedule 1 the creditors' proof has been admitted or has not been admitted for the purpose of voting. But here we are asked to hold that a creditor has not proved his debt at all unless and until the Official Assignee under the rules has admitted the proof for the purpose of dividend. There is no question about this, creditor's right. The creditor has complied with the formalities set forth and has given the required proof of debt. The point taken is not made out and in my opinion this appeal must be dismissed with costs.

C.C. Ghose, J.

7. I agree.


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