MADAN THEATRES LTD Vs. BABULAL CHOWKHANI

JUDGEMENT

(1.) I am of opinion that the preliminary objection taken by the company must prevail. The creditor presented a petition for compulsory winding up on 11 April 1933. The Court directed that the petition should be advertised as provided by the rules. The company moved the Court on 28 April 1933, to have the winding up petition taken off the file. Lort-Williams, J., directed that this should be done on the company furnishing security, to the satisfaction of the Registrar to the extent of Rs. 50,000 within a fortnight and that in default the application should stand dismissed with costs.

(2.) On appeal by the company the Court reduced the security from Rs. 50,000 to Rs. 30,000. On 7 June 1933, the Registrar in insolvency accepted five persons as sureties, the security being their interests in certain immovable properties in Calcutta and its suburbs. The creditor now wishes to appeal against the Registrar in Insolvency's decision under Rule 15, Chapter 6, of the Original Side Rules and Orders. I need not in the circumstances discuss the grounds of appeal in detail. It is pointed out that the properties belong to a firm known as J.F. Madan, in which the sureties along with certain other persons are partners. It is said that under the law a partner cannot pledge partnership property to secure the debt of a third party. Objection is also taken to the title of some of the properties, and to their valuation. Moreover it is submitted that the security is unsuitable, as the properties are already mortgaged to a bank, and this bank has instituted a mortgage suit, which is now pending and in which a receiver has been appointed. The company has supported the Registrar in Insolvency's decision on the merits, but has also maintained that I have no power to interfere with it. The appeal Court, so runs the argument, saw fit to impose the specific condition, on the fulfilment of which the winding up petition was to be taken off the file. That condition was fulfilled as soon as the Registrar in Insolvency, being satisfied with the security, accepted it, and I have no right to review his order, because to do so would be to substitute another condition, namely security to my own satisfaction for that imposed by the Court. I think the correctness of this view is supported by the authority of Hoare and Co. V/s. Morshead (1903) 2 KB 359.

(3.) There leave to defend Under Order 14, Rule 6 of the Rules and Orders of the Supreme Court was given, upon the defendant's furnishing security to the satisfaction of the Master. The Master refused to accept the security offered, and directed that the plaintiffs should be at liberty to sign final judgment. The defendant appealed to the Judge in chambers Under Order 46. Rule 21 which corresponds in all material particulars with our Chapter 6, Rule 15. The Court of appeal affirmed the decision of the Judge that no appeal lay to him. Mathew, L.J., observed that in the circumstances of the case the Master acted as a person designated by virtue of the power given to the Judge of imposing any terms on giving leave to defend. Cozens. Hardy, L.J., also indicated his opinion that the Master was acting, not in exercise of his jurisdiction as Master, but as a persona designata. I appreciate that in the case before me the Court was not exercising a statutory power to impose conditions, but the power of the Court to order the removal of the petition on terms is not and cannot be challenged before me. Had the Court intended that the Registrar's deoision should be 1. (1903) 2 KB 359 subject to appeal, it would have been quite simple to make this clear in the order.