M RATCHAGANADAN Vs. KISHINDAS SHAMADASUNDER

JUDGEMENT

(1.) THE appeal is from the judgment of Venkataraman J. in an insolvency proceeding before the learned Judge, and, the learned Judge allowed the proceedings and adjudicated the appellant (Ratchaganathan) as insolvent, the under S. 13 read with S. 9 (d) (ii) and (iii) of the Act, mainly on this conclusion of fact that the appellant (insolvent) departed from his dwelling house or usual place of business, and also secluded himself, under such circumstances as to warrant the inference that he did so with intent to defeat or delay his creditors. Since most of the facts are not in dispute, it is sufficient for us to deal with matter fairly briefly, on the merits of the evidence adduced before the learned judge.

(2.) AS far as the present respondent (petitioning creditor) is concerned, he had to meet a preliminary ground of absence of the requisite territorial jurisdiction in the court, but we do not propose to dilate on this, for the simple reason that it appears to be very clear to us that, on the materials placed before us and on the principles of law applicable the adjudication of the appellant cannot be sustained. For the purpose of argument, therefore, we shall assume that the learned Judge had the requisite jurisdiction. We shall also take for established the main facts. viz. , that the appellant, who was a cashewnut merchant at Panruti, apparently with very substantial property, had also an address at Madras which was 52 ayyappa Chetti Street, Mannadi, Madras, and that the appellant did borrow Rs. 5000 from the present respondent, a firm of indigenous bankers, furnishing this address at Madras. There has been controversy between the parties whether the rubber stamp bearing this address in the hundi Ex. P. 1, as a stamp affixed at the instance of the respondent for a technical that the appellant had such a branch place of business at Madras. However that might be and assuming that the appellant had such an address at Madras, it is clear enough from the evidence of the appellant (R W 1) and the rest of the record that this place really belonged to one Govindaswami and that the telephone at that place belonged to that person govindaswami, the reputed friend of the appellant. Hence it may very well be that this was not an actual branch but a convenient address furnished by the appellant as is also indicated by the pass book of the appellant with the Indian Bank, kothavalchavadi branch.

(3.) THE other facts are very simple, and the record is quite clear and definite. The broker who transacted this loan on behalf of the respondent (P. W. 2) tried to establish contact with the appellant, both at Madras and at Panruti, when the loan became due and was not paid. The learned Judge has stressed certain possibilities for his view that the facts spoken to by the broker might justify the inference that the appellant had not merely departed from his usual place of business and absented himself, but that he had secluded himself, so as to deprive the creditors of the means of communicating with him. But we are afraid, that, as the records stand, such an inference would appear to be quite unwarranted. The notice Ex. P. 2 dated 29-12-1962 sent by post, was returned unserved. But, admittedly, that relates to the Madras address alone. As we have pointed out earlier, the Madras address might merely have been a nominal and convenient designation, for the purposes of loan transactions at Madras. There seems to be no doubt that the real place of business of the appellant was at Panruti, that he was having factory there, and that he had extensive properties there, both a number of houses as well as lands. Hence, the fact that the notice Ex. P. 2, was returned unserved relating to the Madras address is of no significance whatever; as an Panruti the addressee was perhaps temporarily absent. As far as the evidence of the broker Prabhat singh (P. W. 2) is concerned, his failure to contact the appellant at No. 52 Ayyappa chetti St. Madras, is again, not significant, for the very simple reason that this was merely a nominal address for the purpose of the transactions of the appellant at madras; it is perfectly possible, and even probable, that he was using this place, which belonged to his friend Govindaswami, as an address for purposes of account transactions and that it was not a branch office at all.