KHUSAL CHAND SADANI Vs. BALKISSEN MOHTA

JUDGEMENT

(1.) This is a petition by one Khusal Chand Sadani residing at No. 26, Shib Thekur Lane. Calcutta-7 for adjudication of one Balkissen Mohta residing at No. 23, Kali Krishna Tagore Street as an insolvent. The petitioner's case is that the said Balkissen Mohta stood guarantee for due payment of a sum of Rupees 12,542/- interest and cost when an order by consent was made by the Company Court in petition No. 183 of 1970 filed by this petitioner in the matter of Belur Glass Works Limited. The said Belur Glass Works Limited failed to pay in terms of the said order and went into liquidation. Thereafter the petitioner proceeded against the said surety Balkissen Mohta for realisation of the sum and an order of attachment was passed by the Company Court on the 12th December, 1972 when the petitioner applied for execution. Pursuant to the order the right title and interest of Balkissen Mohta in his undivided one third share in premises No. 23, Kali Krishna Tagore Street was attached by the Sheriff of Calcutta on the 3rd of July, 1973. The petitioner's case is that the said debtor Balkissen Mohta three months before the date of presentation of this petition committed an act of insolvency namely that one third share in premises No. 23, Kali Krishna Tagore Street belonging to the debtor has been lying attached for not less than, twentyone days in execution of the order dated the 25th of November. 1970. A sheriff's certificate is attached to the petition.

(2.) Mrs. Pal opposing the application on behalf of the debtor pointed out that under Section 9 (e) of the Presidency Towns Insolvency Act an 'act of insolvency' occurs if a property is attached in "execution of the decree of any Court." Referring to Section 2 (2) of the Civil Procedure Code she pointed out that decree is not only a formal expression of an adjudication conclusively determining the rights of the parties but the matters in controversy must be in a suit. She submitted that a strict construction was necessary of the word 'decree' mentioned in Section 9 (e) of the P. T. Insolvency Act. She cited the case of Ramshai Mullmore v. Joylall reported in AIR 1928 Cal 840. That was a case before a Division Bench of this Court in which Rankin C. J. held that an attachment in execution of an award is not attachment in execution of a decree within the meaning of Section 9 (e) for the purpose of creating an act of insolvency. He observed inter alia,

(3.) Appearing on behalf of the creditor Miss Ojha contended that the word 'decree' substantially meant a final determination of the matters in controversy and what was essential was that the dispute must be of civil nature and not interlocutory in character. If those characteristics were present the order of adjudication by the Court could be treated as a decree. She also pointed out that there was difference between the old Arbitration Act on the basis of which the decision was made by Rankin C. J. and the new Act. Under Section 17 of the new Arbitration Act a judgment is passed on an award but formerly no such judgment was passed. Her submission was that the nature of arbitration proceedings is completely different from the nature of the proceedings before the Company Court Arbitration is conducted in a private forum but in this case adjudication was done by the Court itself and that made a difference. She also pointed out that although a decree in terms of Section 2, Sub-section (3) of the Civil Procedure Code mentioned a suit, the word 'suit' was nowhere defined.