Appannan vs V.N. Subbanna Goundan and Others

Panchapakesa Ayyar, J.—This is a petition by one Appanna Mudaliar against the orders of the Additional District Judge, Coimbatore, in

I.A. No. 358 of 1956, in C.M.A. No. 4 of 1955 on his file, impleading one Subbanna Goundar, the petitioner in that interlocutory application, as

the fourth respondent in the Civil Miscellaneous Appeal. That was a Civil Miscellaneous Appeal filed by this petitioner, who had been adjudicated

an insolvent in I.P. No. 40 of 1952, for quashing that order of adjudication. One T. G. Ayyaswami Mudaliar had filed the insolvency petition for

adjudicating the petitioner insolvent, alleging that he owed him some Rs. 3,000 and odd, and that the insolvent owed diverse other sums to diverse

other creditors, and was unable to pay his creditors, and had committed acts of insolvency within three months before the filing of the petition. The

resourceful insolvent-petitioner promptly deposited the amount of Rs. 3,125-10-0 claimed by Ayyasami as due to him. Ayyaswami gladly

withdrew that amount and ceased to take any interest in the insolvency petition thereafter. But Papammal and Mangalammal, two persons claiming

to be creditors in respect of Rs. 1,000 each put in a petition to add themselves as petitioning creditors in the insolvency petition, since Ayyasami,

the first petitioning creditor, had not been diligent in prosecuting the insolvency petition. They alleged that the petitioner-insolvent had alienated all

his properties in favour of a Mahommedan lady and her daughter on 15th December, 1951, before the filing of the insolvency petition, for Rs.

9,000. They were added as-petitioning creditors 2 and 3, and the petitioner was adjudicated an insolvent. He then filed the Civil Miscellaneous

Appeal.

The petitioner-insolvent had filed a Second Appeal against the decree in O.S. No. 80 of 1949 under which alone Papammal and Mangalammal

became creditors of his, and that appeal was allowed, and a fresh account was directed to be taken in respect of the partnership carried on by the

insolvent and the petitioning creditors 2 and 3. Fearing that in such fresh taking of accounts the debts of Papammal may disappear, and they may

cease to be creditors, or that the insolvent may deposit the amount found due to them on such fresh taking of accounts and get rid of the

insolvency, Subbanna Goundar, who claimed to be a creditor for more than Rs. 30,000 regarding the insolvent under two decrees in O.S. Nos.

473 of 1950 and 446 of 1951 on the file of the Sub Court, Coimbatore, wanted to be added as a. respondent in the Civil Miscellaneous Appeal in

order to fight out the request of the petitioner-insolvent for the cancellation of the adjudication. His application was stoutly opposed by the

insolvent, but was granted by the learned Additional District Judge on the ground that, if his application was not granted and the insolvency petition

was dismissed, because of the disappearance or settlement of the comparatively small debts due to Papammal and Mangalammal, gross injustice

would result as in a case decided by Mr. Basheer Ahmed Sayeed, J., in Chandramoleswaran v. Krishnaswami Naidu (1952) 2 M.L.J. 148. So he

allowed Subbanna Goundar''s application and added him as the fourth respondent in the Civil Miscellaneous Appeal. Hence this Civil Revision

Petition.

I have perused the records and heard the learned Counsel on both sides. Mr. K.S. Naidu, learned Counsel for the petitioner raised several

grounds. The first was that in this case there was no proof that Papammal and Mangalammal, petitioning creditors 2 and 3, had not proceeded with

due diligence, or were colluding with the petitioner, and that therefore the requirements of Section 16 of the Provincial Insolvency Act were not

satisfied. I cannot agree. The first petitioning creditor, Ayyasami, had taken away the amount deposited by the insolvent towards his debt, and had

not proceeded with the petition diligently thereafter. He is a petitioning creditor, and, so, the requirements of Section 16 will be satisfied. Besides,

even if Papammal and Mangalammal do not collude with the petitioner and if the debts due by the petitioner to them disappear on fresh account

taking, or are deposited by the petitioner, as he deposited the debt due to Ayyasami, the petitioner will get his adjudication automatically cancelled,

defeating all his other creditors including Subbanna Goundar, who claims Rs. 30,000, and gross injustice will result and the principle of the ruling in

Ckandramouleswaran v. Krisnaswanti Naidu (1952) 2 M.L.J. 148, will apply.

Then Mr. Naidu urged that the ruling in In re Maund v. Ex Parte Maund L.R. (1895) 1 Q.B. 194, will apply and that the Court had no power to

amend an insolvency petition by adding, as petitioners, after three months had elapsed from the date of bankruptcy upon which the petition was

founded, the creditors whose debts were other than those in respect of which the petition was presented. This ruling will not help him as the

petition presented by Ayyasami must be held to enure for the benefit of all the creditors of the petitioner on that date, and, indeed, the allegation in

it was that the petitioner, by alienating all his properties, had made it impossible for all his creditors to recover their dues. So, even Subbanna

Goundar''s debt, if it existed on the date of the filing of the insolvency petition, as is conceded by Mr. Naidu, will be a debt in respect of which the

insolvency petition by Ayyasami was presented. In the end, therefore, I see no reason whatever to interfere with the order passed by the learned

Additional District Judge. It is confirmed, and this Civil Revision Petition is dismissed, but, in the circumstances without costs.