PATHI GUNDAPPA Vs. OFFICIAL RECEIVER

JUDGEMENT

(1.) On 10 November 1930 two partners in a cloth business, named Gaveppa and Rudrappa respectively, were adjudicated insolvents in the Court of the-District Judge of Bellary. They had also, carried on a motor bus business. On 3rd, April 1930 Gaveppa sold four motor buses- to the appellant for Rs. 10,000 and on 29 April 1930 he sold two others for Rs. 2500. On 28 April 1930, he sold a motor shed to the appellant for Rs. 170. On 5 April 1935-the Official Receiver filed an application (I.A. No. 77 of 1935) for an order setting, aside the sales of the motor buses on the; ground that the transactions constituted fraudulent preferences. On 11 February 1935 he filed an application (I.A. No. 86 of 1935) for an order setting aside the sale of the shed on the same ground. The District, Judge dismissed the applications, but on appeal to this Court they were allowed and the transactions set aside by a judgment, dated 18 March 1942.

(2.) On 17 August 1943, the Official Receiver filed I.A. No. 177 of 1943, in which he asked, for an order directing the appellant to pay mesne profits in respect of the shed at the rate of Rs. 12 per mensem from the date of the alienation. On the same date he filed another application (I.A. No. 178 of 1943) asking the Court to pass an order directing the appellant to pay into Court Rs. 2500, the price of the two buses sold on 29 April 1930 (he had already paid Rs. 10,000, the price of the four buses first sold) and interest at 12 per cent, on Rs. 10,000 from 3 April 1930 and at the same rate on Rs. 2500 from 29 April 1930. The appellant opposed these applications on the grounds that they did not lie, that they were barred by the doctrine of res judicata and that they were out of time. The plea of res judicata was based on the fact that, in his applications asking for declarations that the alienations were void on the ground that they constituted fraudulent preferences, the Official Receiver had also asked for mesne profits and interest but no order was passed on these prayers either by the District Court or by this Court on appeal.

(3.) The District Judge held that the applications did lie and that the doctrine of res judicata did not operate. He did not, however, deal with the question of limitation. Holding that the applications lay, he granted mesne profits in respect of the motor shed at the rate of Rs. 12 per month from 11 February 1935, the date on which the Official Receiver applied for an order under Section 54, Provincial Insolvency Act, in respect of that alienation and interest on Rupees 10,000 and Rs. 2500, at six per cent, from 5 April 1935, the date on which the Official Receiver applied for an order in respect of the alienation of the buses.