SHAH SUKRAJ Vs. OFFICIAL ASSIGNEE MADRAS

JUDGEMENT

(1.) THIS is an appeal against the order of Ramaprasada Rao J. dated 8-7-1977 and made in Appn. No. 355 of 1977 in I. P. No. 31 of 1967. One R. A. Khaleel was adjudged insolvent by an order of this court dated 23-12-1970 in I. P. No. 31 of 1967 filed by two creditors of the said R. A. Khaleel. The act of insolvency alleged was that on 9-3-1967, the said Khaleel conveyed 12-89 acres of lands to the appellant herein, with intent to defeat and delay the creditors, for a grossly low sum of RS. 43000. The appellant herein, who is the transferee, was also impleaded as a party to the main petition, namely, the second respondent. Ganesan J. , who disposed of the insolvency petition came to the conclusion that the debtor had committed an act of insolvency, within the scope of Section 9 (b)of the Presidency Towns Insolvency Act, hereinafter referred to as the Act. namely, 'a debtor commits an act of insolvency, if, in (the States) or elsewhere, he makes a transfer of his property or of any part thereof with intent to defeat or delay his creditors. ' The learned Judge, after elaborately considering the evidence, recorded the following findings-

(2.) THE appellant herein filed his counter affidavit and the matter came to be disposed of by Ramaprasada Rao J. under the impugned order. The learned judge, after referring to the findings of Ganesan J. and the conclusion of the bench which disposed of the O. S. Appeal, extracted the following passage from the order of Ganesan J. :--

(3.) MR. T. R. Srinivasa Iyengar, learned counsel for the appellant, con- tends that having regard to the decision of the Supreme Court in Subramania Iyer v. Official Receiver, Quilon, holding that unless a transferee is found to have colluded with the debtor, the transaction cannot be held to be void under Section 55 of the Act, the burden was on the Official Assignee to plead and prove that the transferee had the scheme of defeating or delaying the creditors of the debtor, or, in other words, the transferor and the transferee had the common intention to defeat or delay the claims of the creditors of the debtor, and that in this particular case the Official Assignee had neither alleged nor proved any such intention on the part of the transferee.