TEHMINA DINSHAW TEHRANI Vs. OFFICIAL ASSIGNEE

JUDGEMENT

(1.) THIS is an appeal by the first respondent from a judgment of Planiswamy, J., who held on an application by the Official Assignee that, having regard to the state of evidence as finally recorded, the only finding possible was that the first respondent wife and the second respondent husband who was adjudicated as insolvent by an order dated December 2, 1964, were equally entitled to the site and the building bearing No. 3/2A. College Road, Nugambakkam, Madras. The site was purchased on July 5, 1948, admittedly in the names of both those respondents. The consideration therefor was a sum of Rs. 21,595 -11 -8. In 1952 a building was constructed at a cost of about Rs. 65,000. Rs. 25,000 out of Rs. 65,000 was raised by a mortgage executed by both of them. Evidence was adduced on both sides to support the exclusive claim to the property made by each of them the 1st respondent and the Official Assignee. Ultimately, on an analysis of the entire evidence, it turned out that neither the appellant, who was the first respondent, nor the second respondent who was the insolvent represented by the Official Assignee, could establish that one or the other contributed any particular sum either for the purchase of the site or for the construction of the building. It was, in those circumstances, and particularly having regard to the recitals in the mortgage deed, Palaniswamy J. recorded a finding that the property belonged to the appellant and the insolvent in equal halves.

(2.) MR . Sivaramakrishnaiah, who appears for the appellant -wife contends that in the absence of an agreement between the parties, the learned Judge had no jurisdiction to proceed with the application under Section 7 of the Presidency Towns Insolvency Act. He relies on the proviso and argues that the mere fact that the appellant had obeyed the summons of the Official Assignee, appeared before him and placed materials before him, would not take the application of the Official Assignee out of the scope of the proviso to Section 7. We are unable to appreciate this contention. It was quite open to the appellant to have refused to appear before the Official Assignee and place any material to his advantage. The proviso contemplates the court and not the Official Assignee. The object of Section 36 mentioned by the proviso to Section 7, is to enable the Official Assignee to gather materials in support of his claim. In such a case the procedure under Section will have to be followed. But, in the instant case, without following that procedure, the Official Assignee had already obtained such material as he could from the appellant. In such circumstances, there was no need for the Official Assignee to resort to Section 36 at all. That being the case, we are of opinion that there was hardly any occasion for applying the proviso to Section 7 so that the Official Assignee was free to use the material which he had already obtained by sunmmoning the appellant.

(3.) WE note that, though the Official Assignee claimed the entirety of property as exclusively belonging to the insolvent and succeeded only to the extent of a half, he has not flied any appeal to the extent of his failure to establish the total claim. In view of this, we think that the ends of justice will be met by holding that one half of the site belonged to the appellant and one half of mortgage money, namely, Rs. 12,500 also belonged to the appellant, with which part the cost of the building was met. This will work out a proportion of 5/7 as belonging to the appellant and 2/7 as belonging to the insolvent. This proportion will be applied to one half of the entirety of the property which is the subject -matter of the appeal. Should there be any difficulty in making a division on that basis, either the appellant may pay the difference and get the property, or the property may be sold under the direction of the court sitting in insolvency and the proceeds may be divided according to that proportion.