KOVVURI SATHIREDDI Vs. TADI ANASUYA

JUDGEMENT

(1.) The petitioner seeks to revise the order of the District Judge confirming that of the Subordinate Judge annulling an alienation, under Section 63 of the Provincial Insolvency Act evidenced by Ex. E dated 30th November 1941. The document was executed by one Tatareddi and his minor son represented by him, his brother Subba Reddi and the latter's minor son for an alleged consideration of Rs. 3,000 in favour of the respondent. Within a few months thereafter, Tatareddi was adjudged an insolvent in I. P. No. 2 of 1942. Thereafter the petitioner moved the Official Receiver to take steps for avoidance of this document under Section 53 of the provincial insolvency Act. As the latter refused to do so, he applied for and obtained permission of the court under Section 54-A of the Provincial Insolvency Act. Having thus obtained the leave of the court, the petitioner filed an application under Section 63 of the Act in the court of the Subordinate Judge of Rajahmundry for a declaration that the sale deed in question was void against the creditors and the Official Receiver and for making the property available for distribution among the creditors. The transaction was impeached on the grounds that there was no consideration for this sale and that at any rate the alienee did not act in good faith in taking a conveyance of these properties.

(2.) The trial court found that the sale in question was fully supported by consideration but was vitiated by lack of good faith on the part of the vendee. In the result it set aside Ex. B. in respect of the insolvent's one-fourth share.

(3.) Both parties appealed against this decision to the District court. The appellate Judge concurred in the opinion of the Subordinate Judge both as regards want of good faith of the alienee and the extent to which the sale could be avoided. In the result, the appeal filed by the alienee as well as the cross-objections filed by the petitioning creditor were dismissed.