SARBHU LAL Vs. MAHESH DAS

JUDGEMENT

(1.) These are two appeals which have been brought in this Court. No. 10 of 1929 is brought as a second appeal from order and No. 167 of 1929 is brought as a first appeal from order. In neither case do appeals lie to this Court under the provisions of Section 75, Provl. Insol. Act. We have however examined the records and heard learned Counsel for the appellant with a view to seeing, whether either of these matters require to be examined as a revision. In regard to No. 10 of 1929, the insolvent Sarbhulal complains of an order adjudicating him an insolvent. This order was passed on the application of a creditor Mahesh Das. Mahesh Das sued on the mortgage executed by Sarbhulal and obtained a preliminary mortgage decree. It was open to Mahesh Das to have a final decree for sale prepared on this preliminary decree. Instead of doing so he made an application to the insolvent Court on 30 August 1928 to have his judgment-debtor Sarbhulal adjudged an insolvent.. This was based on an act of insolvency alleged an have taken place on 13 July 1928.

(2.) Now the first point which has been taken before us is that because Mahesta Das had obtained a decree on his mortgage therefore he was no longer a secured creditor within the meaning of Section 2 (1) (c), Provl. Insol Act. That section defines a secured creditor as "a person holding a mortgage charge or lien on the property of the debtor or any part thereof as a security for a .debt due to him from the debtor." The argument of counsel is that the mortgage security merges in a decree and therefore the decree-holder cannot be considered a secured creditor. No authority has been put before us for this proposition and we consider that the secured creditor who has obtained a decree is not thereby precluded from making an application under Secs.7 and 9, Provl. Insol . Act.

(3.) The second point which was argued before us was that there was no evidence on which the learned District Judge could come to the conclusion that an act of insolvency had been committed. The particular act alleged against the insolvent was that on 13 July 1928 he had made a gift to the widow of his brother of a house valued at Rs. 8000. This fact was admitted. There were two mortgages on. other portions of the property of Sarbhulal, and it was found as a fact on his own statement that his remaining property, which was not secured and which he had not transferred by the gift, was less than Rs. 1,000 in value. The particular property which was secured to Mahesh Das was valued by Mahesh Das at Rs. 2,500 and eventually sold for Rs 3,750. The decree of Mahesh Das amounts to Rs. 4,613-15-0. There was also another creditor Asaram. It has not been shown that there was no evidence before the learned District Judge on which he could arrive at the finding of fact, that by the transfer of a house valued at Rs. 8,000 the creditors of Sarbhulal were defeated or delayed. We consider therefore that it is not shown that the order adjudicating the plaintiff insolvent was in any way an order with which we should interfere. Accordingly we dismiss No. 10 of 1929 with costs including counsel's fees on the higher scale in this Court.