DHARAMNATH PRASAD Vs. SURJI DEVI

JUDGEMENT

(1.) THIS is an appeal against the order of the District Judge of Darbhanga made in an insolvency proceeding. An application was made by the creditor, Mt. Surji Devi, under the Provincial Insolvency Act hereinafter referred to as the Act for adjudicating the opposite parties 1 to 5 of the application insolvents. Opposite parties 6 to 10 of the application were minors and there was no prayer to make them insolvents. The applicant further prayed for the appointment of an 'ad interim' receiver to take charge of the property of the opposite party with a view to safeguarding her interest and that of the other creditors. An interim receiver was appointed, but when the question came up of taking possession of the property of the opposite party the minors put in an objection to the receiver taking possession of their share of the joint family property. The District Judge dismissed the objections raised by the minors. Hence the present appeal.

(2.) TO decide the question arising in this appeal the provisions of Section 20 of the Act have to be considered and those of Section 28-A of the Act. But before that is done one has to consider the preliminary objection raised on behalf of the respondent that the appeal is not maintainable in view of the provisions of Section 75, Sub-section (3) of the Act. It was contended that as the order passed by the District Judge is not one of those specified in Schedule I to the Act, under Sub-section (3) of Section 75 of the Act an appeal to this Court from the order of the District Judge could only be by the leave of this Court.

(3.) IT was, however, contended by the Government Advocate that under Section 4 a court of insolvency has full power to decide all questions whether of title or priority, or of any nature whatsoever, and whether involving matters of law or of fact, which may arise in any case of insolvency coming within the cognizance of the Court, or which the Court may deem it expedient or necessary to decide for the purpose of doing complete justice or making a complete distribution of property in any such case. Consequently, it was suggested that as the minors had been made parties to the proceeding although they could not be adjudged insolvents, and the debt in question was one which was binding on the joint family property, it was within the jurisdiction of the insolvency Court to direct the 'ad interim' receiver to take possession of the joint family properties. In my opinion Section 4 of the Act cannot override the express provisions of Section 20 of the Act, because Section 4 itself says that its provisions are subject to the provisions of the Act. Section 20 gives the power to the Court to appoint an 'ad interim' receiver of the property of the debtor only, and that express provision cannot be avoided by having resort to the provisions of Section 4 of the Act. IT will be noticed that under Section 20 of the Act an 'ad interim' receiver has only such powers as a receiver appointed under the Code of Civil Procedure. In the circumstances,' the 'ad interim' receiver appointed under Section 20 of the Act could not be directed to take possession of the joint family property of an undivided Hindu family governed, by the Mitakshara law merely because one of its members, although the manager or 'karta', is being proceeded against for an act or acts of insolvency.