SAMANDAR LAL Vs. PRAKASH CHAND

JUDGEMENT

(1.) This is a civil revision raising a point under the Provincial Insolvency Act which is not free from difficulty. The insolvent was adjudicated on 21 September 1939 and obtained his discharge on 18 October 1940. In May 1941 an order was made by the Insolvency Judge that the insolvent's property, which, of course, remained vested in the Receiver notwithstanding his discharge, should be sold by public auction. The only property which at that time remained in the hands of the Official Receiver was a fruit garden at Saharanpur, in respect of which there was a liability to pay Government revenue. The insolvent immediately applied to the Court that this property should not be sold on the ground that, since he was an agriculturist paying less than Rs. 250 in Government revenue, the land was protected from sale by Section 17(1)(a), U.P. Debt Redemption Act (Act 13[XIII] of 1940). On 11 April 1942, the Civil Judge of Saharanpur came to the conclusion that the property was so protected and held that it was not saleable in the insolvency. The opposite view was taken on appeal by the District Judge of Saharanpur and on 18 April 1948 he made an order directing the land to be sold by the Receiver. It now comes to us in revision. The short point is to determine whether the effect of Section 60(2), Provincial Insolvency Act, is to incorporate the provisions of Section 17(1)(a), U.P. Debt Redemption Act, into insolvency, so as to prevent the Receiver, in administering the estate of an agriculturist insolvent in insolvency, from selling property which, had it been the property of an agriculturist who had not been adjudicated insolvent, would have been protected by the Debt Redemption Act from sale "in execution of a decree to which this Act applies," i.e., to which the U.P. Debt Redemption Act applies.

(2.) Section 60(2), Provincial Insolvency Act, is in the nature of a proviso saving from the effects of the Insolvency Act any enactments for the time being in force protecting debtors from the execution against their immovable property of decrees to which the-Act applies. It reads: (2) Nothing in this Act shall be deemed to affect any provisions of any enactment for the time being in force prohibiting or restricting the execution of decrees or orders against immoveable property; and any such provisions shall be deemed to apply to the enforcement of an order of adjudication made under this Act as if it were such a decree or order.

(3.) We think it clear on the face of the sub-section that it does make applicable to insolvency under the Provincial Insolvency Act all those provisions of any other Act for the time being in force - and that, of course, would include any Act passed after the date of the Insolvency Act - which prohibit or restrict the execution of decrees or orders against immovable property, and that that would prima facie include an Act, protective of debtors from the execution of decrees of the general character of the U.P. Debt Redemption Act. We have the assistance of the view of a learned Judge of the Lahore High Court, in reference to a particular Act of his Province, that in general there is no reason why, in view of Sub-section (2) [of Section 60], Provincial Insolvency Act, legislation of the particular character referred to in it should not take effect against a Receiver in insolvency : Ram Rattan V/s. Fazal Haq ( 39) 26 A.I.R. 1939 Lah. 346. We respectfully agree. The actual decision in that case does not, however, help us further than that, since it had reference to the Punjab Alienation of Land Act, and not, of course, to the U.P. Debt Redemption Act. But it appears to us that there are conditions to be carefully observed in applying a restrictive enactment under Section 60(2), Provincial Insolvency Act, against the Receiver in the insolvency. First, the restrictive enactment must only be applied in the insolvency to the same extent that it could operate in favour of the judgment-debtor outside the insolvency; and, secondly, it must always be a condition precedent to its application in insolvency at all that it can be so applied without departing from its substantial purpose. If it can be so applied, then, to the extent that it would operate outside the insolvency, it should be applied in the insolvency. But if, on its construction, we find that it cannot ration, ally be applied to an insolvency at all, then it cannot be applied at all, since it obviously cannot be supposed that Section 60(2), Provincial Insolvency Act, has attempted to make applicable to an insolvency something that is intrinsically inapplicable. Reverting to Section 60(2), Provincial Insolvency Act, itself, we think that its concluding sentence affords the answer to the question before us. It reads: ...and any such provisions shall be deemed to ajjply to the enforcement of an order of adjudication made under this Act as if it were such a decree or order.