BAI HIRA DEVI Vs. OFFICIAL ASSIGNEE OF BOMBAY

JUDGEMENT

(1.) This appeal by special leave arises from the notice of motion taken out by the respondent official assignee under S. 55, Presidency-towns Insolvency Act against the appellants for a declaration that a deed of gift executed by the insolvent Daulatram Hukamchand on 22nd May 1950, in favour of the appellants was void. It appears that some creditors of Daulatram filed a petition in the High Court of Judicature at Bombay, Insolvency Case No. 74 of 1951, for an order that the said Daulatram be adjudged insolvent as he had given notice of suspension of payment of the debts on 2nd August 1951. Daulatram was adjudicated insolvent on 21st August 1951, with the result that the estate of the insolvent vested in the respondent under S. 17 of the Act. On 26th September 1951, the respondent took out the present notice of motion. The impugned deed of gift has been executed by the insolvent in favour of his wife and three sons who are the appellants before us. In reply to the notice of motion appellants 1 to 3 filed a joint affidavit setting out the facts and circumstances under which the said deed of gift had been executed by the insolvent in their favour. In substance, the appellants' case was that, though the document purported to be a gift, it was really a transaction supported by valuable consideration and as such it did not fall within the mischief of S. 55 of the Act. At the hearing of this notice of motion before Coyajee J., when the appellants sought to lead evidence in support of this plea, the respondent in support of this plea, the respondent objected and urged that the evidence which the appellants wanted to lead was inadmissible under S. 92, Evidence Act. The learned Judge, however, overruled the respondent's objection and allowed the appellants to lead their evidence. In the end the learned Judge did not accept the appellants' contention and, by his judgment delivered on 28th January 1954, he granted the declaration claimed by the respondent under S. 55 of the Act.

(2.) Against this judgment and order the appellants preferred an appeal (No. 30 of 1954) which was heard by Chagla C. J. and Shah J. The learned Judges took the view that Coyajee J. had erred in law in allowing oral evidence to be led by the appellants in support of their plea that the transaction evidenced by the deed of gift was in reality a transfer for consideration. The learned Judges held that the gift in question had been executed by the donor in favour of the donees out of natural love and affection and that, under S. 92, it was not open to the appellants to lead evidence to show that the transaction was supported not by the consideration of natural love and affection but by another kind of valuable consideration. On this view of the matter the learned Judge did not think it necessary to consider the oral evidence actually led by the appellants and decide whether Coyajee J. was right or not in rejecting the said evidence on the merits. That is how the appeal preferred by the appellants was dismissed on 6th August 1954. On 23rd September 1954, the application made by the appellants for a certificate was rejected by the High Court at Bombay ; but special leave was granted to the appellants by this Court on 3rd November 1954, and that is how the appeal has come before us for final disposal.

(3.) The principal point which arises in this appeal is whether the appellants were entitled to lead oral evidence with a view to show the real nature of the impugned transaction. In deciding this question, it would be necessary to consider the true scope and effect of Ss. 91 and 92, Evidence Act.