SARDAR PRASAD Vs. OFFICIAL RECEIVER AND ANR

JUDGEMENT

(1.) This and the connected S. A. F. 0. No. 29 of 1944 arise out of a judgment and decree of the learned District Judge of Kanpur, confirming the judgment and decree of the learned Judge of the Court of small causes exercising the powers of an Insolvency Judge at Kanpur passed on an application made by the Official Receiver in a case in which one Chandu Lal had been adjudicated insolvent.

(2.) The debtor Chandu Lal sold some property situated in Juhi which he had acquired from the Improvement Trust to Balchand, the Appellant in appeal No. 29 of 1944 on the 20th August 1937 for a sum of Rs. 1,800/-. On the 17th May 1938 Balchand sold the same property to Sardar Prasad, the Appellant in this appeal for a sum of Rs. 2,000/-. Chandulal presented a petition for insolvency on the 31st August 1938 and was adjudicated insolvent on the 3rd January 1939. One of the prayers of the Official Receiver was that as Chandulal had been adjudged insolvent within two years after the date of transfer, the transfer made by him with respect to the property in question on the 20th August 1937 in favour of Balchand as well as the subsequent transfer made by Balchand in favour of Sardar Prasad on the 17th May 1938, be annulled Under Sections 53 and 4 of the Insolvency Act and Section 53 of the Transfer of Property Act.

(3.) It further appears that Chandulal held a money decree against one Jamaluddin. On the 4th July 1938 Jamaluddin executed a promissory note in favour of Balchand for a sum of Rs. 150/- and on that very date the decree held by Chandulal against Jamaluddin was declared satisfied by the execution Court. The promissory note executed by Jamaluddin in favour of Balchand was subsequently incorporated in a money decree in favour of Balchand. The Official Receiver's case is that these transactions were fictitious and he accordingly asked for a declaration that the money decree obtained by Balchand against Jamaluddin on the basis of a promissory note executed by the latter in his favour on the 4th July 1933 also belonged to the debtors estate. The learned Judge of the Court of small causes accepted both the contentions of the official receiver. On appeal the learned District Judge, as we have seen, confirmed the judgment and decree of the trial Court. Both Balchand and Sardar Prasad have come up in appeal to the High Court.