NARAHARI RAMANAMMA Vs. OFFICIAL RECEIVER OF KISTNA

JUDGEMENT

(1.) This appeal arises in the insolvency of one G. Venkatasubba Rao who was adjudged insolvent on 5 January, 1938, in I.P. No. 22 of 1934 on the file of the District Court, Kistna. The appellant is one of the creditors and respondents 2 and 3 are two of the other creditors while the first respondent is the Official Receiver, Kistna. The appellant is the holder of a decree against the insolvent in O.S. No. 466 of 1934 (District Munsiff's Court, Masulipatam). Evidently in pursuance of a notification in the Gazette on 27 April, 1943, calling for proof of debts by the creditors of the insolvent, the appellant filed an affidavit before the Official Receiver on 15 June, 1943, in which he set out that he had obtained a decree in the suit abovementioned on 9 September, 1935, and that a sum of Rs. 2,346-1-6 was due to him up to the 5 January, 1938. A copy of the decree was not, however, filed along with the affidavit. On 6 September, 1943, this affidavit was returned to the appellant with a direction to file the decree copy before the 9 July, 1943. On 9 July 1943, ten days further time was granted for filing the decree and again further time till 26 July was granted. Eventually the Official Receiver directed the appellant to file a petition and affidavit to excuse the delay in re- presentation, and also granted him time to re-present the affidavit along with the copy of the decree till 13 September, 1943. Admittedly the appellant did not re-present this affidavit till 13 December, 1943, when he produced a copy of the decree.

(2.) Meanwhile on 16 November, 1943, the Official Receiver declared a dividend at Re. 0-8-5 in the rupee, but excluded the appellant's debt in the calculation of this dividend. He prepared a schedule of creditors from which the appellant was omitted. The schedule of creditors and the dividend were approved by the District Court on 22nd November, 1943.

(3.) On 23 December, 1943, after having re-presented the affidavit with a copy of the decree, the appellant filed in the District Court, Application No. 1639 of 1943 purporting to be under Secs.5 and 33 of the Provincial Insolvency Act and other sections of the Code of Civil Procedure, praying that the Court may be pleased to amend the schedule of creditors framed by the Official Receiver and approved and sanctioned by the Court on 22nd November, 1943, by adding the debt due to him. On 31 December, 1943, while this application was pending, the Official Receiver accepted the claim of the appellant to the debt due to him. under his decree. However, dividends were paid away to the creditors entered in the schedule approved by the District Court in March and April, 1944. The appellant's application itself was disposed of on 22nd July, 1944, when the District Judge rejected the application. Hence this appeal. The ground on which the learned District Judge dismissed the application was that the appellant was guilty of negligence in not filing the copy of the decree before the Official Receiver in time and by the time the decree copy was filed the schedule had been prepared, the payment of dividends had been ordered to the creditors included in the schedule and that the dividends paid to such creditors could not be ordered to be re-deposited as the law did not permit such a course. The learned District Judge observed however that it was open to the appellant to come in proper time when a second dividend was available and participate in it. When this appeal first came on before me, I felt it necessary to obtain information on certain points and I have since received a report from the Official Receiver furnishing information on some of the points. It is now clear from this report that the dividend that was declared on 16th November, 1943, and approved by the Court on 27 November, 1943, was the final dividend.