S P P L PALANIAPPA CHETTIAR, THROUGH HIS AUTHORISED AGENT RAMANATHANCHETTIAR Vs. OFFICIAL RECIEVER OF MADURA

JUDGEMENT

(1.) This petition arises out of an application by the Official Receiver of Madura under Section 54 of the Provincial Insolvency Act to declare as void a certain hypothecation bond dated 21st July, 1931, in favour of the respondent and to annul the same.

(2.) The bond was executed by the insolvent in I.P. No. 48 of 1931 and also on behalf of his minor sons. On the merits it was found by both the Courts below that the alienation was a fraudulent preference and it was accordingly annulled. In this petition no attempt has been made to question the correctness of the concurrent findings to this effect by the two Courts below, and the only point urged is that the transfer can be set aside or annulled only as regards the insolvent's own share in the family properties which were mortgaged and that it cannot be set aside or annulled in respect of the minors shares in the properties, because it is only the transfer of the insolvent's property that can be set aside under Section 54 of the Act. Reliance is placed in support of this contention on the decision of Sundaram Chettiar, J., reported in Subramanian Chettiar V/s. Subbaraya Goundan . No other decision on the point has been brought to notice, and Sundaram Chettiar, J., in his judgment mentions that the point is a new one. I have given my best consideration to this question and I find myself unable to agree with the view expressed by Sundaram Chettiar, J. The main; point to remember is that what was mortgaged was the family property and not the separate shares of the executants, namely, the father and the sons. The mere fact that the sons also were joined in the document with the father representing them does not show that it was intended to mortgage the sons shares separately from the father's share. What was done was that the entire family property was mortgaged, the executants being not merely the father but also his minor sons represented by him. The minor sons cannot be said to have had any separate share in the family property which they could hypothecate under the bond. In a somewhat similar case, the only difference being that instead of the father the eldest brother and managing member of the family took part along with his brothers, namely, the case reported in Gharib-ullah v. Khalak Singh (1903) L.R. 30 I.A. 165: I.L.R. 25 All. 407 (P.C.) which went up to the Privy Council it was held that though in that case one of the three executants of the deed was a minor represented by his mother and the alienation was open to objection on the ground that the mother could not validly act as guardian of the minor's property the alienation was upheld by their Lordships on the Judicial Committee on the ground that the eldest brother's execution of the document was sufficient to convey the entire interest in the family property once it was proved that the alienation was for valid family necessity. In the present case there can be no doubt that the father had authority to mortgage the entire family property because the debt for which the mortgage was executed was an antecedent debt of his not tainted by illegality or immorality. In other words, this is a case in which the father, that is, the insolvent, was himself entitled in law to convey the entire interest in the family property and his execution of the bond purports to convey the entire interest also. In these circumstances the mere joining of his minor sons represented by himself as their guardian does not in any way diminish the legal effect of the transaction which is that of a valid alienation of the entire joint family property by the father. Section 54 of the Provincial Insolvency Act is to the effect that a transfer of property made by the insolvent may in certain circumstances be annulled by the Court. The present transfer is a transfer of property made by the insolvent and the other conditions are satisfied. The section does not say that it is only a transfer of the insolvent's own or separate property that can be annulled by the Court. So long as the transfer of property ex facie binds the whole property such transfer can be annulled under Section 54 when the conditions are satisfied even though it may be joint family property in which the minor sons had an interest. I am therefore of opinion that the decree appealed from is right and that there is no need to interfere in revision.

(3.) The petition is accordingly dismissed with costs.