CHITTAMMAL Vs. PONNUSWAMI NAICKER

JUDGEMENT

(1.) This appeal is against the order of the District Judge of Tinnevelly directing the appellants to hand over possession of the property in their possession to the Official Receiver and his lessee. The 1 respondent herein is the lessee of the property from the 2nd respondent who is the Official Receiver of Tinnevelly. The appellants were in occupation of the property in dispute from the year 1897. The respondents applied to the District Judge for an order under Section 56 of the Provincial Insolvency Act directing the appellants to hand over possession of the property in dispute to the respondents on the ground that the property was the property of the insolvent. The learned Judge has passed an order under Section 56 (3) in favour of the respondents. The question for consideration is whether such an order can be passed against persons who claim adversely to the insolvent. Section 56, Clause 3, para. 2, is in these terms: Provided that nothing in this section shall be deemed to authorise the Court to remove from the possession or custody of property any person whom the insolvent has not a present right so to remove.

(2.) An application under Section 56 is made for the purpose of realisation of the property of the insolvent. If a person is in possession of the property on behalf of the insolvent, or claims under the insolvent, possession of such property may be taken under the orders of the Court by the Official Receiver. But where the person in possession claims adversely to the insolvent, or where he is able to show that the insolvent is not entitled to present possession, the Court has no power to proceed under Section 56, for the second paragraph of Clause 3 specifically says that " nothing in this section shall be deemed to authorise the Court to remove from the possession or custody of property any person whom the insolvent has not a present right so to remove." The corresponding provision in the Presidency Towns Insolvency Act is Section 58; and Clause 2 of that section puts the matter beyond doubt. It is as follows: The Official Assignee shall, in relation to and for the purpose of acquiring or retaining possession of the property of the insolvent, be in the same position as if he were a receiver of the property appointed under the Civil P. C., 1908, and the Court may, on his application, enforce such acquisition or retention accordingly.

(3.) The position of the Official Assignee is therefore the same as that of a Receiver appointed under the Civil P. C.. Order 40, Rule 1(2) is as follows: Nothing in this rule shall authorise the Court to remove from the possession or custody of property any person whom any party to the suit has not a present right so to remove.