PATHURI DHARMA RAO Vs. VATLURU CO OPERATIVE BANK

JUDGEMENT

(1.) The petitioner is a debtor. He filed a petition under S. 10 of the Provincial Insolvency Act, to declare him an insolvent on the ground that he was unable to pay his debts. He had borrowed monies from the respondents. The 8th respondent obtained a decree in O. S. No. 339/1970 on the file of the District Munsifs Court, Eluru and in execution of that decree, the petitioner was arrested and produced before the Court on 8-11-1971. He gave an undertaking to the Court that he would file an Insolvency Petition and he was released. The 1st respondent obtained a decree against the petitioner on the foot of a mortgage for a sum of Rs. 10,000.00, and in execution of that decree the lands and the house of the petitioner were attached and the petitioners share in the house was sold in auction. The second respondent filed O. S. No. 136/1971 in the Court of the Subordinate Judge, Eluru on the basis of a promissory note executed by the petitioner for Rs. 15,000.00 and obtained attachment before judgment, of his family properties. The petitioner had shown his debts in the A schedule to the petition. They come to Rs. 56,652.00. He had shown his properties in the B schedule. They are Ac. 4-861/2 cents. He estimated their value at Rs. 5,600.00.

(2.) The respondents resisted the petition by contending that the petitioner is the manager of the joint family since the death of his father in 1949, and the joint family owns properties of an extent of Ac. 45-76 cents, and most of the debts shown in the A schedule are concocted for the purpose of the petition. The petitioner has admitted in the cross-examination that his family owned Ac. 50-00 of land, and he gave security of Ac. 26-30 cents for the sum of Rs. 10,000.00 borrowed from the 1st defendant. He also admitted that his father gave Ac. 80-00 of land to him and to his other three brothers. He admitted that he had got 1/4th share in the property, but he had not shown it in the petition schedule. He contended that he and his brothers had divided the joint family properties in 1956, but that was not believed by both the lower Courts in view of the documents, Exs. B-2 to B-4. Thus, both the Courts held that the petitioner had suppressed to mention all the properties in the petition. The Insolvency Court held that Rs. 30,000.00, out of the debts shown by the petitioner, had to be paid jointly by the petitioner and his brothers. It further observed that even if the petitioner alone has to pay the balance of Rs. 26,652.00, his 1/4th share of Ac. 43-22 cents and 1/4th share in the house property was sufficient to discharge that amount. On the ground that he had failed to fully disclose his assets and his assets were more than his liabilities and he had the capacity to pay the debts, the Insolvency Court dismissed the petition. Those findings were confirmed in appeal by the District Judge, West Godavari.

(3.) It is submitted by the learned counsel for the petitioner that there is no clear finding that the value of his assets is more than his debts. I do not agree. If we read the judgment of both the lower courts as a whole, that is the conclusion they have arrived at,