RAM SINGH JAISWAL Vs. CENTRAL BANK OF INDIA

JUDGEMENT

(1.) THIS Miscellaneous Appeal under Section 75 of the Provincial Insolvency Act, 1920 is directed against the judgment and order dated 19.3.97 passed by the District Judge, Singhbum, West in Insolvency case No. 3/87 whereby he has rejected the application of the appellant for declaring him as Insolvent.

(2.) THE petitioner -appellant filed an application under Section 7 of the Provincial Insolvency Act, 1920 (in short the Act) with a prayer that he may be adjudicated insolvent. The appellants case is that he was an employee of Tisco Ltd. at Jamshedpur from where he retired in August 1974 and is presently residing in Plot No. NS5, phase I, Industrial Area, Adityapur, Jamshedpur. His son had taken a loan of Rs. 40,000/ - from Central Bank of India, Adityapur and a sum of Rs. 20,000/ - from Bihar State Industrial Development Corporation, Patna for carrying on his business. In the said loan the appellant stood as a guarantor. The creditor - Central Bank of India filed a suit against him and his son for the recovery of sum of Rs. 1,39,137/ -. It is stated by the appellant that he sold half portion of the house for a consideration of Rs. 30,000/ - and the remaining half was disposed of by way of trust in favour of his grand children. Consequently, he filed an application in the said Court for adjudicating him insolvent.

(3.) FROM bare perusal of the insolvency application it appears that the intention of the appellant was mala fide in as much as, in order to exonerate him from the liability as a guarantor against the loan taken for his son, the appellant managed to sell the property and transferred it by creating a trust in favour of the children. The Court below rightly recorded a finding that the appellant failed to establish that he is insolvent. I do not find any strong reason to differ with the finding recorded by the Court below.