AVADAI AMMAL Vs. K L S SUBBURAMIER

JUDGEMENT

(1.) THE second appeal comes before us on a reference by Ismail, J. He considered that the point of limitation arising in this case in it covered by any authority, and should, therefore, be decided by a Division Bench.

(2.) THE plaintiff are the appellant who are the mortgagees. The mortgage was executed on 10th June 1948, by the third defendant in favour of one nachiarammal, whose heirs are the appellants. On 10th September 1948, certain creditors of the mortgagor filed I. P. 37 of 1948 to adjudicate him as an insolvent. That petition was dismissed on 28th November 1948. But the appeal arising from that order was allowed on 24th October 1950. A revision therefrom failed, this court indicating, while disposing it of, that the appellants should be treated as secured creditors. The properties of the insolvent mortgagor having vested in him the Official Receiver on 10th July 1961, sold the property, subject to the mortgage in favour of the appellants. The suit to enforce the mortgage was laid on 23rd october, 1961, which was beyond 12 years. The appellants, however, relied on two acknowledgment, dated respectively 22nd November 1949 and 23rd March 1959. The defence that the mortgagor could not validly acknowledge the mortgage debt between the date of filing of the petition for and the date of the order of adjudication was not accepted, and the suit was decreed. But the defence, however, prevailed on appeal. The mortgage are, therefore, before this court in second appeal.

(3.) THE only question on which the second appeal turns is whether the mortgagor, who had been adjudicated as an insolvent could validly acknowledge the debt between the date of the filing of the petition for and the date of the order of his adjudication. The first of the acknowledgment was contained in the deposition the insolvent made in the insolvency proceedings, and the other was contained in another deposition made by him in O. S. 101 of 1957. The lower appellate court found the factum of the two acknowledgment, but its view was that they were not valid acknowledgments. It though that because Section 28 (2) of the provincial Insolvency Act provided that on the making of an order of adjudication, the whole of the property of the insolvent vests in the court or in a receiver and Section 28 (7)stated that an order of adjudication should relate back and take effect from the date of the presentation of the petition of which it was made, owing, to this doctrine of relation back, it must be held that the acknowledgment in Ex. A. 2, which was the first of the two acknowledgments, was not valid and could not save the suit from the bar of limitation. The lower appellate court, in support of its view, relied on certain decisions which, as we think, do not directly bear on the point.