Challa Abbireddi and Others vs Challa Venkata Reddi and Another

The 1st respondent herein was adjudicated an insolvent in I. P. No. 46 of 1920 on the file of the District Court of Guntur. As he failed to apply

for discharge within the time fixed his adjudication was annulled. The petitioners are some of the creditors and they applied to the District Court to

have the order of annulment reviewed. The learned Judge thought that the petitioners had a good case on the merits, but declined to grant the

review as he thought that he had no power to review an order made in the exercise of insolvency jurisdiction. The petitioners have preferred this

revision petition against his order.

Section 5 of the Provincial Insolvency Act, Act V of 1920, says:

Subject to the provisions of this Act, the Court, in regard to proceedings under this Act, shall have the same powers and shall follow the same

procedure as it has and follows in the exercise of original civil jurisdiction.

The Court exercising ordinary original civil jurisdiction has power to review its orders. There is no warrant for the proposition that a civil Court

cannot correct its own orders or cannot modify any order which it has passed when it finds that the order is patently wrong. The power of review

is inherent in the civil Court and in what cases it can be exercised is laid down in Order 47. When an insolvency Court has the same powers and

follows the same procedure as a civil Court exercising ordinary orginal civil jurisdiction it cannot reasonably be contended that the power to review

has been taken away. Under the English Bankruptcy Act the power to review is specifically given: vide Section 108. Such provision is not

specifically enacted in the Provincial Insolvency Act as the insolvency Court is invested with jurisdiction which an ordinary civil court has in the

exercise of its original jurisdiction.

The point has been specifically dealt with by Spencer, J., in The Official Receiver, Tanjore v. Nataraja Sastrigal A. I. R. 1923 Mad. 355. In

Munnu Lal v. Kunj Bihari Lal A. 1922 All. 206 a Bench of the Allahabad High Court held that a District Judge was competent to review his

judgment in appeal. They observe at page 606:

We are content to say that, in our opinion, the District Judge had jurisdiction to review his own order because Section 5 of the Provincial

Insolvency Act V of 1920 gave him, when sitting as an appellate Court, the same powers under the CPC which he would have had if he had been

sitting to hear any ordinary appeal.

In spite of these two rulings the learned Judge thought that the decision in Arunagiri Mudaliar v. Kandasawmy Mudaliar A. I. R. 1924 Mad. 635

was against his power to review his own order and he could not therefore review it. In Arunagiri Mudaliar v. Kandaswamy Mudaliar A. I. R. 1924

Mad. 635 the question of the power of review of an insolvency Court was not raised. One of the questions there was whether the time fixed for an

application for discharge by the insolvent could be extended or not. Krishnan, J. was of opinion that he could; but Waller, J., thought that the Court

had no power to extend the time fixed for an application for discharge by the insolvent and that the provisions of Section 43 were obligatory on the

Court to annul the adjudication if an application was not made within the time fixed. It is not necessary to deal with this case in detail as the point

raised here did not arise for decision there. If an expression of opinion is necessary we would be inclined to hold with Krishnan, J., that the Court

has power to extend the time for making an application for discharge provided that the application is made before the order of annulment is made.

The Arunagiri Mudaliar v. Kundaswami Mudilar A. I. R. 1924 Mad. 635 case does not decide anything about the power to review an order and

the learned District Judge was not right in thinking that that decision stood in the way of granting a review.

The next point is whether the petitioners are persons aggrieved. It has been brought to our notice that at least two of them have tendered their

proof. If they have tendered their proof, they are creditors and they are persons aggrieved by the order of the Court annulling adjudication. It was

held in In re Henry Langtry [1894] 1 Man 169 that a creditor who had tendered his proof was a person aggrieved within the meaning of Section

104 of the English Bankruptcy Act. In Ex parte Ditton In re Woods [1879] 11 Ch. D. 56 the Court of appeal held that a person who had not

tendered his proof was not entitled to appeal as a person aggrieved. Seeing that two of the petitioners have already tendered their proof, they are

entitled to maintain this appeal.

The appeal is allowed and the order of the learned Judge is set aside, and he is directed to restore the application of the petitioner to file and

dispose of it on the merits after taking such evidence as he may think necessary. Costs to abide the result.