CHAGANTI RAMACHANDRAREDDI Vs. GADIKO KOTIREDDI AND OTHERS

JUDGEMENT

(1.) This revision case raises a question as to the power of an insolvency Court to review its orders.

(2.) The facts which have culminated in this revision may be briefly stated:- On 24-9-1953 one Ramachandra Reddy was adjudged an insolvent on his own petition in I. P. No. 17 of 1952 on the file of the Sub Court, Guntur and the Court granted one year's time to the insolvent to apply for discharge. The properties of the insolvent were vested in the Official Receiver immediately on the adjudication. The Official Receiver sold the insolvent's property and realised a sum of Rs. 9,000/-. Before the Receiver, the creditors of the insolvent filed their claims. Some of these claims were allowed but others were rejected by the Official Receiver. The aggrieved creditors filed appeals against the order of the Official Receiver. Meanwhile an application for extension of time for discharge was made and the time was extended till 24-9-1955. On 29-2-1956, the Official Receiver addressed a letter to the Subordinate Judge, Tenali requesting that the adjudication might be annulled under Section 43 of the Provincial Insolvency Act after vesting the properties in the Official Receiver. On 11-4-1956, the learned Subordinate Judge annulled the adjudication unconditionally without giving any reasons. On 29-12-1956, the insolvent filed I. A. No. 147 of 1957 before the Sub Court, Tenali, for a review of the order of unconditional annulment made on 11-4-1956. It was prayed in the application that the earlier order should be set aside and a fresh order be made vesting the properties of the insolvent in the Official Receiver. By his order dated 19th March, 1957, the learned Subordinate Judge annulled the adjudication and by way of rectifying the earlier order, passed a supplementary order vesting the properties in the Official Receiver. The order directed that the Receiver should continue to realise and distribute the debtor's property in accordance with the provisions of the Insolvency Act. Aggrieved by the said order, the 14th respondent, a creditor of the insolvent, preferred an appeal before the District Judge, Guntur. By his order dated 24th February, 1958, the learned District Judge allowed the appeal and directed that the original annulment order dated 11-4-1956 should be restored. It is this appellate order of the District Court, Guntur, that is impugned in this revision petition.

(3.) It may be stated at the outset that while the learned Subordinate Judge held that an insolvency Court had power of review by reason of the provisions of Section 5 of the Provincial Insolvency Act, the learned Appellate Judge took the view that it was within the competence of the insolvency Court to review its orders.