TIRUMALA REDDI CHINNAPPA REDDI Vs. KOLAKULA THOMASU REDDI

JUDGEMENT

(1.) This appeal arises out of an order passed by the District Judge, refusing to annul the adjudication of one Thomasu Reddi and extending the time within which he has to file his application for discharge. Thomasu Reddi was adjudicated insolvent on the 8 of July, 1924, and one year's time was fixed as the period within which he should apply for his discharge. He did not apply within the period and the time was extended to the 11 of August, 1926. As the insolvent did not apply for his discharge as required by Sec. 43, an application was put in on the 13 of December, 1926, by the appellant creditor to annul the adjudication. The Official Receiver submitted his report on the 22nd of December, 1926, stating that some properties were sold on the 30 of June, 1925, that a petition was filed in the District Court to set aside the sale and it was dismissed on the 5 of November, 1925, and that C. M. A. No. 149 of 1926 was filed in the High Court against the order of the District Judge and further proceedings were stayed. He states that it is regrettable that neither the debtor nor any of the creditors applied for extension of time, that the provisions of Section 43 appear to be imperative, that, in the absense of any extension of time, the order of adjudication is liable to be annulled and that it is desirable under the circumstances to issue notice to the creditors and hear them before the order of annulment is passed. The District Judge, on this report and on the creditor's petition, passed an order refusing to annul the adjudication and extending the time to the 23 December, 1927. Another creditor (No. 4) applied on the 10 of December, 1926, under Section 27, Clause (2) of the Act, to extend the time to apply for discharge and this petition was dismissed on the ground that the court had already extended the time on the report of the Official Receiver. So far as the insolvent is concerned, he neither applied for an extension of time nor filed any petition or affidavit setting forth the reasons for his not having applied within the time fixed by the court. The question is whether the learned District Judge was right in extending the time on the report of the Official Receiver.

(2.) It is argued for the appellant that the provisions of Section 43 are mandatory, that the court has no power to extend the time after it has elapsed, that even if it has such power, the only person to apply is the insolvent and that in any case the Judge was wrong in acting on the report of the Official Receiver especially as the report gives no reason for the application to extend the time not having been filed earlier.

(3.) For the respondent it is contended that Section 43 is only directory and not mandatory, that it is open to any creditor or to the Official Receiver to apply for an extension of time even though the time has expired and that in the present case the Judge acted within his powers and in the exercise of sound discretion in extending the time.