SARAT CHANDRA PAL Vs. BARLOW AND CO

JUDGEMENT

(1.) In this matter the question that has been referred to the Fall Bench is as follows: Whether, under Section 18, Presidency Towns Insolvency Act, a Judge of this Court sitting in insolvency has power to stay proceedings pending in respect of the same debtor in a District Court.

(2.) The facts involved are as follows : The appellant, Sarat Chandra Pal, who is the debtor and who carried on business in Calcutta, made an application on 29 October 1927 to the District Judge of Hooghly to be adjudicated an insolvent. That application was made under the provisions of the Provincial Insolvency Act. On the application being made, the learned District Judge of Hooghly made an order for the appointment of an interim Receiver. The District Judge further directed that notices should be sent to the debtor's creditors and fixed 5th November 1927, for the hearing of the petition. This data was afterwards altered an ultimately the hearing was fixed for 26 November 1927. The respondents, Messrs. Barlow & Company, who are the creditors of the debtor, appeared before the District Judge on 26 November 1927 and applied for and obtained time to oppose the debtor's application. On 29 November 1927, they made an application to this Court in its insolvency jurisdiction against the debtor and obtained an order of adjudication. It appears that the debtor was indebted to the extent of about Rs. 76,000 to various creditors and that the debt due to the respondents alone amounted to something like Rs. 39,000 and further that almost all the creditors were residents of Calcutta.

(3.) The insolvent was served on 9 December 1927, with an office copy of the order of adjudication made by this Court bearing date 29 November 1927. The respondents, it appears, made an application to the District Judge of Hooghly for stay of the insolvency proceedings in the Hooghly Court and of the sale by the interim Receiver which the District Judge had ordered already; but the learned District Judge refused the application, and the sale by the interim Receiver took place on 3 December 1927. On 6 December 1927, the Reigstrar in Insolvency of this Court made an order upon the debtor that he should appear and produce his books of account before him on 13 December 1927. The respondents thereafter obtained a rule from the learned Judge exercising the insolvency jurisdiction of this Court calling on the insolvent to show cause why the insolvency proceedings in the District Court of Hooghly should not be stayed. This rule came on for hearing before my learned brother Costello, J., who, by his order dated 12 March 1928, directed that all further proceedings in the Court of the District Judge of Hooghly in the insolvency Case pending before him, being Insolvency case No. 79 of 1927, be stayed until the further orders of this Court. Against this order the insolvent preferred an appeal to this Court being Appeal No. 34 of 1928 and it is on the hearing of the said appeal before the learned Chief Justice and Page, J., that the present reference to a Pull Bench has been made.