VENKATA SUBBAIAH Vs. M. ERUKALAIA

JUDGEMENT

(1.) The petitioner is the judgment debtor in O.S. No. 453/79. E.P. No. 162/82 was filed on 15-2-1982. Subsequently on an application filed by the petitioner under s. 6 of the Provincial Insolvency Act, 1920 Act 5/20 for short 'the Act', one of the creditors i.e. the petitioner was declared to be an insolvent on March 31, 1982. In the execution petition the respondent seeks to arrest the petitioner under O. 21, rr. 37 and 38, Civil P.C. on the plea that the petitioner is possessed of sufficient means to pay the decree debt but has been evading payment thereof. The petitioner raised a plea that by operation of s. 28(2) of the Act unless the leave of insolvency court is obtained the executing court cannot proceed,further in the matter. Therefore, he is not liable to be arrested. That contention was repealed and order of execution by way of arrest of the petitioner was ordered. Thus this revision petition.

(2.) Sri Suresh Kumar, learned counsel for the petitioner relying upon a decision in Kotayya Vs. Rangarao AIR 1935 Mad 239,contends that other legal proceedings within the meaning of s. 28(2) would include execution proceedings. There, fore, unless the leave of the insolvency court is taken, the petitioner cannot be arrested. I am unable to agree with the learned counsel. Sec. 28(2) of the Act provides that on making an order of adjudication, the whole of the property of the insolvent shall vest in the court or in a receiver or as herein provided.... commence any suit or other legal proceeding, except with the leave of the court and on such terms as the court may impose. It is this meaning of the word "any other legal proceeding" was considered in catena of decisions and held that it applies to the execution proceedings as well. The same is the view taken in Kotayya Vs. Ranga Rao (supra) relied by the learned counsel for the petitioner. But, however, in this case that position is not available to the petitioner for the reason that on the making of an order of adjudication, and from the date of making of an adjudication only the right to commence any proceeding against the insolvent except with the leave of the insolvency court would arise. If proceedings were initiated anterior to that date then unless he seeks protection under s. 32 of the Act by the insolvent, the executing court of the decree obtained anterior to the date of adjudication has power to continue the , proceedings and arrest the judgment-debtor in execution of the decree. Admittedly the petitioner did not avail of the remedy provided under s. 32 of the Act. Therefore, there is no inhibition for the executing court to proceed with the execution since the execution proceedings were already laid earlier to the date of the declaration of the petitioner to be an insolvent. Accordingly I do no find any error of jurisdiction committed by the court below in directing execution by Way of arrest of the petitioner.

(3.) Sri Suresh Kumar, learned counsel for the petitioner seeks time for payment of the amount. Three months time is granted to the petitioner for paying the decretal amount. The Civil Revision Petition is dismissed with the above direction. Till three months from to day, there shall be a direction not to execute the decree. No costs.