NAGARPUR SAMBAYYA Vs. NAGARPUR PEDDA SUBBAYYA

JUDGEMENT

(1.) This appeal raises a question of limitation. The suit was to recover a sum of money due in respect of two promissory notes dated 7 May, 1922, executed by the defendant in favour of the plaintiff. Subsequent to the execution of the promissory notes, the creditors, presented a petition in insolvency on 7 November, 1922, to adjudicate the defendant an insolvent. The order of adjudication was passed on 21 March, 1923. The adjudication order was annulled on 5 April, 1928. The suit was instituted on 23 October, 1930. The plaintiff seeks to escape the bar of limitation by alleging that he is entitled to exclude the whole period during which the proceedings in insolvency were pending, that is, from 7 November, 1922, the date of the presentation of the insolvency petition to 5 April, 1928, the date of annulment. The contention of the defendant is that the plaintiff is entitled to exclude only the period from the date of the order of adjudication, namely, 21 March, 1923, to 5 April, 1928, the date of annulment. The learned District Judge has given effect to the contention of the defendant and hence this appeal is preferred by the plaintiff.

(2.) The question is, is this view right ? The relevant provision bearingonthe question is Section 78,Clause (2) of the Provincial Insolvency Act which runs thus: Where an order of adjudication has been annulled under this Act, in computing the period of limitation prescribed for any suit or application for the execution of a decree (other than a suit or application in respect of which the leave of the Court was obtained under Sub-section (2) of Section 28) which might have been brought or made but for the making of an order of adjudication under this Act, the period from the date of the order of adjudication to the date of the order of annulment shall be excluded.

(3.) Unfettered by authority according to the plain terms of the section, the period of exclusion is that from the date of the order of adjudication to the date of the order of annulment. But it is contended that the date of the order of adjudication in Section 78,Clause (2) must be deemed to be the date of the presentation of the petition and reliance is placed on Section 28,Clause (7) of the Provincial Insolvency Act, which provides that: An order of adjudication shall relate back to and take effect from the date of the presentation of the petition on which it is made.