SATYANARAYAN PADHY Vs. NARAYAN SAHU

JUDGEMENT

(1.) THIS is an appeal from an order under Section 53 of the Provincial insolvency act, 1920 passed by the District Judge of Ganjam rejecting an application made by a Receiver of the Estate of the Insovent for annulling eight sale deeds said to have been executed by the insolvent in favour of some transferees. The two respondents who are brothers were adjudged insolvents on the application of some of the creditors filed under Sections 9 (1) and 13 (2) of the aforesaid Act on 14-9-55. The order of adjudication was passed on 14-7-1956, and one satyanarayan Padhy was appointed Receiver to take charge of the Insolvents' 5-57 Eight different applications were filed in respect of eight alienations but they were all heard together. The first two alienations are dated 15-10-54 and 7-1-55 in favour of Sita Devi and Abhiram Das. These appear to be isolated transactions and Mr. D. Mohanty for the appellants frankly conceded that he would not challenge the findings of the lower court as regards the genuineness of these alienations. The remaining 6 alienations took place on 8-7-55 and 9-7-55 as detailed below ;

(2.) IT will be noticed that these alienations are all of two dates viz. 8-7-55 and 9-755 just one year and a few days prior to the date of the order of adjudication of the respondents as insolvents and they are hardly within two months and few days prior to the date on which some of the creditors filed the application under Section 9 (1) and 13 (2) of the Insolvency Act. It should be further mentioned that it was specifically alleged in the creditors' application that the Insolvents had made these transfers of the properties with a view to defeat the claims of the creditors. Schedule D attached to their application gives a full description of these alienations. While adjudging the respondents as insolvents the learned District judge also by his order dated 14-7-56 observed that from the evidence of the applying creditors he was satisfied that the insolvents had been going on executing fictitious sale deeds in favour of their friends, relatives and others and no less than seven such transactions had been entered into during a period of three months preceding the filing of these petitions. It is true that this finding was arrived at in the absence of the alienees on whom special notices were not issued though there was only a general notice published in the gazette.

(3.) NEITHER Gouranga Sahu nor Kalu Sahu (alienees in respect of items (v) and (vi)mentioned in the preceding page cared to enter appearance to challenge the application of the Receiver. The alienation in favour of Kalu Sahu dated 9-7-55 was in respect of two houses of the insolvents and from the evidence of Narayan sabat (witness No. 4 for the alienee) it is clear that the houses are still in the possession of the insolvent. Hence, in any case the lower Court ought to have annulled this alienation. The same comment can be made in respect of the alienation made in favour of Gouranga who has also not cared to enter appearance.