GOVADA BALABHARATHI CO-OPERATIVE CREDIT SOCIETY, REPRESENTED BY ITS PRESIDENT, T SURYANARAYANA Vs. ALAPATI VENKATAKRISHNAYYA

JUDGEMENT

(1.) Balabharathi Co-operative Credit Society of Govada had to get some money from one Ramatulasamma. The society, proceeded under Section 51 of the Madras Co-operative Societies Act of 1932 to recover the dues and an award was passed directing payment of the sum due. The award was being executed against the property of the debtor. At that stage, another creditor of the debtor who is the first respondent in this Civil Revision Petition filed I.P. No. 105 of 1934 to adjudicate Ramatulasamma as an insolvent and applied for the appointment of a receiver under Section 20 of the Provincial Insolvency Act. The Subordinate Judge before whom the application was made rejected the application holding that the Co- operative Credit Society had a first charge upon the entire estate of the debtor. The matter was taken up on appeal, and the Districts Judge held that the Co-operative Society had no prior charge over the general estate of the debtor and that the prior charge refers only to the interest of the member in the share capital of the Society. By the time the appeal was decided by the District Judge, the properties of Ramatulasamma had been sold by the Sale Officer under Rule 22 of the Rules ma4e under the Act, and hence, there was no scope for the appointment of a receiver of the properties. The District Judge, therefore, dismissed the appeal with a direction that the appellant before him might take necessary steps as regards the sale proceeds in the hands of the society.

(2.) The application out of which the present revision arises, was filed in the Subordinate Judge's Court under Section 51(1) of the Provincial Insolvency Act and Section 151 of the Civil Procedure Code, requesting the Court to call for the entire sale proceeds of about Rs. 2,100 or at least the balance due after deducting the amount due to the society. The Subordinate Judge dismissed the application holding that neither Section 51(1) of the Provincial Insolvency Act nor Section 151 of the Civil Procedure Code applied to this case. On appeal, the District Judge came to the conclusion that Section 51(1) of the Provincial Insolvency Act applies and that the Co-operative Society was bound to remit the sale proceeds to the Insolvency Court. The Appellate Court held that the Cooperative Society is not entitled to the benefit of the execution against the receiver in the insolvency because the assets were realised after the date of the admission of the Insolvency Petition.

(3.) This revision petition is filed in this Court by the Cooperative Credit Society. It is argued that Section 51(1) of the Provincial Insolvency Act applies only where execution of a decree has issued against the properties of the judgment-debtor. It is said that in this case the property was sold not in execution of a decree but that it was sold in execution of an award under the Co-operative Societies Act (Madras Act VI of 1932).