MANICKA NAINAR Vs. MURUGESA GOUNDAN

JUDGEMENT

(1.) THE question here is whether a money decree obtained by the appellant against the respondent in the Court of the District Munsiff of Arni on the 13th September, 1927, is barred by the law of limitation. Between the date of the decree and the 28th of September, 1935, the decree -holder filed on different dates three applications for execution. These applications kept the decree alive. On the 28th September, 1935, he filed a fourth application for execution, which resulted in the District Munsiff ordering the respondent's arrest on the 16th December, 1935. He was liberated at once as he undertook to apply under the provisions of Section 55(4) of the Code of Civil Procedure for adjudication, in insolvency. On the same day he filed in the Court of the Subordinate Judge, Vellore, an application for adjudication and on the 20th December, 1935, he was granted interim relief from arrest. Thereupon the District Munsiff dismissed the application for execution. On the 2nd September, 1936, the respondent was -adjudicated an insolvent in the Court of the Subordinate Judge. He failed to apply within the stipulated period for his discharge and consequently on the 25th September, 1940, the order of adjudication was annulled under Section 43 of the Provincial Insolvency Act. On the 20th December, 1942, the decree -holder filed another application for execution. He claimed to be entitled to the benefit of Section 78(2) of the Provincial Insolvency Act. The application was opposed on the ground that the case fell within the proviso to Sub -section (2) to Section 78 as the decree -holder had not proved the debt in the insolvency proceedings. This objection was accepted by the District Munsiff, whose decision was up held by the District Judge of Vellore on appeal. The present appeal is from the order of the District Judge. The appeal first came before Rajamannar, J., who referred it to a Bench for hearing as there is conflict in the judgments of this Court which have bearing on the case.

(2.) SECTION 33 of the Provincial Insolvency Act provides that when an order of adjudication has been made, all persons alleging themselves to be creditors of the insolvent in respect of debts provable under the Act shall tender proof of their respective debts by producing evidence of the amounts and particulars thereof. It is the duty of the Court to examine the amounts owing to the creditors and to frame a schedule of them and their debts. Section 49 states that a debt may be proved under the Act by delivering, or sending by post in a registered letter, to the Court an affidavit verifying the debt. The affidavit shall contain or refer to a statement of account showing the particulars of the debt and shall specify the vouchers by which it can be substantiated. The Court has the right to call for the production of the vouchers. Section 78(2) provides that where an order of adjudication has been annulled under the Act, in computing the period of limitation prescribed for a suit or an application for the execution of a decree (other than a suit or application in respect of which the leave of the Court was obtained under Sub -section (2) of Section 28) which might have been brought or made but for the making of an order of adjudication under the Act, the period from the date of the order of adjudication to the date of the order of annulment shall be excluded ; but the section goes on to state that nothing in it shall apply to a suit or application in respect of a debt provable, but not proved, under the Act. Does the proviso mean that the debt must be proved by the method contemplated in Section 49 or does it leave it open to the Court to accept other proof? It is on this question that there is a conflict of authority.

(3.) IN Ramalinga Aiyar v. Rayalu Aiyar, (1929) 58 M.L.J. 170 :, I.L.R. 53 Mad. 243 a Bench of this Court (Venkatasubba Rao and Madhavan Nair, JJ.) accepted the principle that proof was not confined to the manner of proof contemplated by Section 49 and held that where a decree had been obtained against the Official Receiver after an order of adjudicarion, that in itself was sufficient proof of the debt within the meaning of Section 78(2). In Ramalinga Aiyar v. : AIR1933Mad168 the same learned Judges accepted as proof of the debt factors which were also not in accordance with Section 49. On the other hand, Krishnaswami Aiyangar, J., held in Lachmiram Firm v. : AIR1940Mad716 that the word "proved" in Section 78(2) meant " proved " in accordance with stction 49.