RAMCHANDRA SAHAI Vs. DALPAT

JUDGEMENT

(1.) THIS is an objection by a creditor to the discharge of three insolvents Dalpat, Jehangiri and Gur Sahai, who have been discharged by the Court below after being insolvents for six years. The date of adjudication was 16 June 1928. The applicants in insolvency were cultivators, and on 12 March 1932, the Court gave them two years to apply for discharge. Towards the end of that period they applied on 7 March 1934. It is true that only Rs. 150 had been distributed and the schedule debts were Rupees 5,050-11.6, so that the distribution was much less than eight annas in the rupee. No point was taken under Section 41, Sub- section (1)(a) and that point has not been taken in first appeal. The ground which has been taken by learned Counsel is under Section 42(1)(h), which states that the insolvent has on any previous occasion been adjudged an insolvent or made a composition or arrangement with his creditors. Learned Counsel argues that on 7 November 1931, there was a compromise by which the insolvents undertook to pay Rs. 2,007 and they have not paid that amount. He therefore claims that they should not be discharged. But I consider that Sub-section (h) cannot apply to a case like the present. In my opinion that sub-section means that there should be no discharge of an insolvent who has done one of two things, both previous to the adjudication of insolvency. One of those things is to have been previously adjudged an insolvent, and the other is to have previously made a composition or arrangement with his creditors. The intention of the Act is that where a man has been relieved of his liabilities on a previous occasion by one of those methods, he is not entitled to be relieved of his liabilities a second time by the Court of insolvency granting him a discharge after a second adjudication as an insolvent, but that in such a case he shall remain permanently as an undischarged insolvent and have the disadvantage of not being able to obtain further credit without disclosing the fact that he is an undischarged insolvent. Learned Counsel desires to read the words "previous occasion" as applying only to the words "adjudicated an insolvent". If that were so, the sub-section would mean that any one who made a composition would be debarred from being discharged even though he carried out the terms of the composition and paid all his creditors. Such a meaning would be possible as the section has no words which limit the case of composition to a composition which is not carried out by the insolvent. Clearly therefore the composition must be governed by the words "on any previous occasion" and these words mean a composition previous to the adjudication.

(2.) NO ground has been shown for interference with the order of the Court below. I may note that the appellants are cultivators and that the failure to carry out the composition of 1931 is probably due to the agricultural depression which has resulted in special legislation in this province, and that it is the policy of the Legislature not to keep a burden of debt on cultivators and therefore the order of the Court below discharging these cultivators is in accordance with that policy. For these reasons I dismiss this first appeal from order with coats.