A. Velumani vs Angappa Mudaliar

T. Ramaprasada Rao, J.—Following the decision of the learned Judge Govindarajachari, J., in The Official Trustee of Madras as Receiver

Vs. S.V.L.L. Sethu Chettiar and Others, , this revision petition has to be dismissed. The petitioner is a transferee from a debtor who was sought to

be adjudicated insolvent by one of the creditors. The Court entertained the application of the creditor, examined him, accepted two documents

filed by him and marked them as Exhibits A-1 and A-2 and thereafter said ""Petition is allowed adjudging the respondent insolvent "". Curiously

enough the respondent therein did not file an appeal. But the respondent before me and in the lower Court in these proceedings being the

transferee of the properties of the insolvent and who is really affected by the order of insolvency filed an appeal against the perfunctory order which

resulted in the insolvency of his vendor. The tower Court rightly appreciated the evidence, accepted the appeal and remitted the matter for a fuller

consideration by the insolvency Court. The petitioner before me (petitioning creditor) objected to the maintainability of the appeal by the transferee

who is outside, prima facie, the proceedings initiated by him against the insolvent. He would also say that the order of insolvency was passed on

merits. But these contentions were not upheld and the appeal was allowed and the matter remitted to the insolvency Court for a fuller appraisal and

adjudication of the real issue. As against this the present revision petition has been filed.

Learned counsel for the petitioner though feebly attempted to maintain that the order of adjudication was made on merits was not able to sustain

the same since the non-speaking order of the insolvency Court is neither evident nor self-explanatory. It does not appear from the record that the

insolvency Court applied its mind to the material placed before it, before it pronounced the order of adjudication. The learned Subordinate Judge

who passed the order does not even say that he was prima facie of the view that by such alienations under Exhibits A-1 and A-2 the insolvent

intended to defeat and delay the interests of his creditors''. This observation should find a place in such orders in order to avoid any misgiving at a

later stage about the non-application of the mind of the insolvency Court to the facts and circumstances of the case and to the real matter under

controversy. Therefore, the order of adjudication has been pronounced in such an unsatisfactory state of affairs. This cannot be disputed by the

learned counsel for the petitioner.

The more important question is whether the transferee respondent before me is a person aggrieved within the meaning of section 75 of the

Provincial Insolvency Act, which would enable him to file an appeal to the appellate authority to interfere with the aforesaid order of adjudication.

The learned counsel for the petitioner relies upon the decision in Al. A. Algappa Chettiar Vs. Vellachami Servai, , in support of his contention. That

is not a case which is opposite to the one under consideration by me. That was a case where an appeal was filed by one creditor against the

acceptance of the claim of another creditor. Interests of creditors in an insolvency petition are distinct and separate. The interest of one creditor has

no impact on the interest of another creditor in so far as the insolvency is concerned. This patent circumstance was taken into consideration by the

Division Bench of our Court when it said that a co-creditor of an insolvent cannot be deemed to be an aggrieved person when another creditor''s

claim is accepted by the official receiver. Facts therefore are totally different and the ratio in that case is inapplicable to the present situation.

The relevant and the nearest case which could be cited has been referred to by the learned counsel for the respondent. An eminent Judge of our

Court Govindarajachari, J., in The Official Trustee of Madras as Receiver Vs. S.V.L.L. Sethu Chettiar and Others, , in an elucidatory and

illuminating judgment and after referring to the decision in Al. A. Algappa Chettiar Vs. Vellachami Servai, , held that a person who satisfies the

description of the respondent in this revision petition would be an aggrieved person within the meaning of section 75 of the Act. I am inclined to

excerpt certain observations of the learned Judge instead of in any manner lessening the weightage of the observations made by him in the said

judgment. After narrating in extenso the English authorities, the learned Judge accepted the view that ""any person who makes an application to the

Court for decision or any person who is brought before the Court to submit to a decision, is, if the decision goes against him, thereby ''a person

aggrieved'' by that decision."" The learned Judge also said that the embarrassment which may result from the order of adjudication provides such

embarrassed person with a sufficient grievance and clothes him with the necessary status to question the older of adjudication is an appeal. The

involuntary involvement of the transferee in the insolvency, makes him an affected person. While respectfully adopting the observations made

above, I am of the view that the lower Court was right when it said that the transferee from the insolvent could maintain the appeal and having

regard to the circumstances of the case I uphold the order of remit since the original pronouncement resulting in the adjudication of the insolvent is

based on a cryptic non-speaking order. The revision petition is dismissed. There will be no order as to costs.