FIRM DATTULAL BADRINARAYAN Vs. SIDDHESHWAR JAGANNATH

JUDGEMENT

(1.) This appeal is directed against an order passed by the Insolvency Court rejecting the application of the appellant for an absolute discharge.

(2.) The circumstances leading to the order may briefly be stated as follows:- The appellant is a firm whose partners are Dattulal and Badrinarayan. This firm carried on business in silver and gold and ultimately came to grief. The debts due from the Firm got swollen to Rs. 80,155-15-9 and they were unable to discharge their obligations. An application for their adjudication was submitted by the appellants. They were accordingly adjudicated insolvents. The appellants then submitted an application for their discharge after their assets had been made over to the Official Receiver. The property, which was found with the insolvents, was an immovable property subject to mortgage and after the disposal of the property and the payments of dues of the secured creditor only Rs. 2358-9-6 were lying in the hands of the Receiver. The creditors opposed the application for grant of absolute discharge. The matter was thereupon enquired into. Dattulal, one of the owners of the firm, admitted in his statement that they had incurred a debt of Rs. 80,000/- within a course of three or four years. In the forward transactions which they indulged in there were profits to begin with but later on losses were sustained so as to wipe out the profits earned. They continued the transactions in spite of the losses and ultimately found that they were not in a position to pay their debts. To begin with they had a shop for the purchase and sale of silver and gold in species. The losses which occurred were as a result of speculative transactions. When the losses were initially sustained they knew that they were not in a position to bear the burden of their losses and still continued the transactions hoping that they would be in a position to make them up. The statement of the other owner of the appellant firm Badrinarayan is almost on the same lines. He also stated that when the debts went on increasing they were fully aware that 'their personal property was not enough to pay the burden of those debts and still they continued their business in dealing in speculative transaction The object, in thus continuing this sort of business was that they hoped that they would be (sic) position to discharge their debts by such (sic)

(3.) In view of the statements of the appellants the learned Insolvency Court held that the appellants were not entitled to the grant of absolute discharge and refused the same.