OFFICIAL RECEIVER Vs. NEMINADHA MUDALIAR

JUDGEMENT

(1.) This Civil Miscellaneous Second Appeal and the Civil Revision Petition have been filed against the order of the District Judge of West Tanjore on an application by the Official Receiver to set aside a usufructuary mortgage executed by three insolvents in favour of the respondent and also a payment to him of Rs. 2,800. The learned District Judge agreed with the trial Court that the transactions in question were fraudulent preferences. The transactions were therefore set aside as far as the insolvents share in the property was concerned but not with regard to the shares of certain members of the insolvents family who had not been declared insolvents. The Official Receiver also claimed mesne profits, which was granted by the District Judge from the date of order and not, as the Official Receiver claimed, from the date of his application to set aside the alienations. The appeal and civil revision petition have been filed by the Official Receiver because of the refusal of the District Judge to set aside the mortgage as far as the shares of those who were not insolvents were concerned, and also because of the disallowance of mesne profits from the date of application. A memorandum of cross objections has been filed by the alienee, contending that there was no sufficient justification for the finding of the Courts below that the transactions were in fraudulent preference of the transferee. It is also contended that the lower Court was wrong in ordering the respondent to repay the whole of the Rs. 2,800 paid to him.

(2.) Since the order of the first Court was under Section 54 of the Act no second appeal lies. The application was no doubt filed under Section 4 also; but it was not necessary for the lower Court to invoke the provisions of Section 4 in passing the orders it did. No second appeal therefore lies. As however the Official Receiver has taken the precaution to file a civil revision petition also, and the questions raised are questions of jurisdiction, the matters raised both in the civil miscellaneous second appeal, civil revision petition, as well as in the memorandum of cross-objections, can be considered.

(3.) With regard to the main point in appeal, I am satisfied that the lower appellate Court was right, though there has been some difference of opinion in this Court as to the law to be applied. Kuppuswami Ayyar, J., in Jashi Parvalhavardhanamma V/s. Adusumalli Venkataramiah (1944) 1 M.L.J. 19, pointed out that Secs.53 and 54 applied to transfers of property by an insolvent and that if, therefore, the transfer was by an insolvent and others, the Insolvency Court would have jurisdiction only with regard to the shares of the insolvent. In this conclusion he followed the decision of Sundaram Chetti, J., in Subramania Chettiar V/s. Subbaraya Goundan (1934) M.W.N. 801. Pandrang Row, J., in Palaniappa Chetli V/s. Official Receiver, Maduraa,in considering the arguments of Sundaram Chetti, J., pointed out that although Section 53 dealt with transfers by insolvents, a Hindu father had power to transfer not only his own share but also the share of his undivided sons and that the transfer could therefore be wholly set aside. Kuppuswami Ayyar, J., considered that the decisions of Sundaram Chetti, J., and Pandrang Row, J., were necessarily inconsistent, and he preferred the decision of Sundaram Chetti, J., as being more in accord with the later decisions of this Court. There is, however, no necessary conflict between the law laid down by Sundaram Chetti, J., and that laid down by Pandrang Row, J. If it appears from the document of transfer that the insolvent was transferring the share of his son by virtue of his right as an undivided father, the principle of law enunciated by Pandrang Row, J., might perhaps be applied. If, on the other hand, the document showed that the son was himself a party to the transaction, then the father was not purporting to exercise his right as a father.