VEERAYYA Vs. GOPALAKRISHNA RAO

JUDGEMENT

(1.) THIS civil revision petition raises a simple question of law. The petitioner beria filed an application under Order 1 Rule 10 C. P. C. to be impleaded as a party in I. P. No. 4. of 1952 on the file of the Subordinate Judge's Court, Guaivada. The Subordinate Judge dismissed the application on the ground that the decision in Jaleel Sahab v. Seeniappa Ramaswami Mudaliar & Co. was directly applicable. On appeal, the District Judge of Krishna confirmed his decision. He held that though the decision referred to by the Subordinate Judge was not applicable, still the petitioner was entitled under the terms of sections 19 and 24 of the Provincial Insolvency Act to prove that the respondent herein (1) 1951 (1) M. L.J. 87- R-19 was not a creditor and that the application filed by him to adjudicate the 2nd respondent, was not maintainable. The petitioner has consequently filed the Civil Revision Petition to this court. An examination of the several provisions of the Provincial Insolvency Act (V of 1920) clearly shows that without being impleaded as a party to the insolvency petition, under the terms of Order 1 Rule 10 C.P.C. it is open to the petitioner who is a creditor to oppose the application filed by the 1st respondent to adjudicate the 2nd respondent as an insolvent. Section 9 sets out the conditions when a creditor is entitled to present an insolvency petition against a debtor and section 10 relates to the presentation of an insolvency petition by a debtor. Section 14 provides that no petition, whether presented by a debtor or by a creditor, shall be withdrawn without the leave of the court. Section 16 enacts that where the petitioning-creditor does not proceed with due diligence on his petition, the court may substitute any other Creditor to whom the debtor may be indebted in the amount required by the Act in the place of a petitioning creditor. Section 19 (1) prescribes that where an insolvency petition is admitted, the court shall make an order, fixing a date for hearing the petition. Sub-section (2) provides that the Court shall give notice of the order fixing the date for hearing the petition to all the creditors. Section 24 lays down the procedure to be adopted at the hearing of the petition. Clause (a) of sub-section (1) provides that the court shall require proof that the creditor or the debtor, as the case may be, is entitled to present the petition. Sub-section (2) enacts that the creditors shall have the right to question the debtor, when he is examined, as to his conduct, dealings and property. Sub-section (3) is significant as it provides that the court shall, if sufficient cause is shown, grant time to the debtor, or to any creditor to produce any evidence which appears to it to be necessaryi or the proper disposal of the petition.

(2.) THE Sections referred to supra, clearly establish that the creditors to whom notice is given as provided under Section 19 (2) are entitled to appear at the hearing of the petition and oppose the maintainability of the insolvency petition by a creditor or a debtor. THEy are entitled to adduce evidence and satisfy the court that the provisions of Sections 9 or 10 of the Act are not complied with and that the insolvency petition should be dismissed under Section 25. As under the provisions of the Provincial Insolvency Act it is open to the petitioner herein to. prove that the 1st respondent is not a creditor of the 2nd respondent and that the insolvency petition is engineered by the 2nd respondent only with & view to defeat and delay his rights, I do not think it is necessary to add him as a party under the terms of Order 1 Rule 10 C. P. C. Sections 5 and 18 no doubt make it clear that the procedure laid down in the Code of Civil Procedure shall so far as it is applicable be followed in the case of insolvency petitions; but it is unnecessary to apply the provisions of Civil Procedure Code, viz., Order 1 Rule 10, to this case, as the Provincial Insolvency Act itself has made adequate provision in this behalf. THE point arising for decision in this case was considered by Jai Lal, J. in M. Chand Kaur v. Official Receiver THE learned Judge pointed out that, though no case law on the subject had been cited on either side, in his opinion, the question was clear from the phraseology of section 24. I agree with his opinion and follow that decision. THE decision in Jaleel Sahib v. Seeniappa Ramaswami Mudaliar & Co. does not directly apply to the facts of this case. But the principle laid down by the Judge, that the provisions of the Code of Civil Procedure will not apply when there are other provisions in the Provincial Insolvency Act, governs this case. THE learned Judge rightly held that under section 16 of the Provincial Insolvency Act it was open to the court to substitute another creditor in the place of the petitioning creditor, if he did not proceed with due diligence on his petition and that he need not be added as a party under the terms of Order 1 Rule 10 G. P. C. THE Civil Revision Petition therefore fails, and is dismissed with costs, one set. Revision dismissed.