In Re: Haji Jan Mahomed Haji

Davar, J.—Haji Jan Mahomed Haji was previous to the 30th day of April 1909 carrying on business as a merchant in Bombay. Haji Ahmed

Haji Sulleman, who alleges that he is a creditor of Haji Jan Mahomed, on the 30th of April last, presented a petition to the Officiating Chief Justice,

who was then one of the vacation Judges, and obtained an order whereby the said Haji Jan Mahomed was adjudicated an insolvent. A vesting

order was made, and he was ordered to file his Schedule within thirty days thereafter. The adjudicated insolvent is stated to have left Bombay and

the petitioning creditor has not been able to serve the order of adjudication on him. The Official Assignee acting under the vesting order has taken

possession of a piece-goods shop belonging to Haji Jan Mahomed. The shop contains goods of large value.

On the 18th of June 1909 Mr. Robertson, on behalf of his client Haji Jackeira Haji Ahmed Patel, applied to me for a rule calling upon the

petitioning creditor to show cause why the order of adjudication obtained by him should not be ""reviewed"" or revoked.

The adjudicating creditor in his petition had stated that Haji Jan Mahomed on the 20th of April 1909, when he was in hopelessly insolvent

circumstances, had with intent to delay and defeat his creditors fraudulently assigned over to Haji Jackeira Haji Ahmed Patel, his friend and his

daughter''s father-in-law, by way of mortgage all his property movable and immovable in British India in order to secure an alleged debt of three

lacs and fifty thousand rupees.

Haji Jackeira in the affidavits put in, in support of his application for a review or revocation of the order of adjudication, admits that a mortgage

was executed in his favour by the adjudged insolvent on the 20th of April, but denies that the same was fraudulent and urges that the order of

adjudication was improperly obtained by making incorrect representations to the learned Judge. Although I had doubts in my mind as to whether

Mr. Robertson''s client was entitled to make the application--as the matter was of some importance and as the question was not free from doubt--

I granted the rule and made it returnable on the following Wednesday. The rule was argued before me last Wednesday the 23rd instant when Mr.

Setalvad for the petitioning creditor, the Advocate-General for the Official Assignee, and Mr. Mankar for a creditor in showing cause against the

rule raised as a preliminary point the question as to whether Mr. Robertson''s client Haji Jackeira had any locus standi and was entitled to make the

application. By consent of counsel it was agreed that this question should be first gone into and determined before discussing the merits. The

question for determination, therefore, is whether the applicant Haji Jackeira Haji Ahmed Patel is entitled to make this application for either review

or revocation of the adjudication order.

The insolvent was adjudicated in accordance with the provisions of Section 9 of the Indian Insolvent Act, 11 and 12 Victoria, c. 21. That

section after providing for the adjudication of a trader provides for the revocation of that order in the following terms:

Provided always that it shall be lawful for the said Court, upon the petition of any person adjudged to have committed an act of insolvency as

aforesaid to revoke or confirm such adjudication.

It is quite clear that under the provisions of this section, the only person who can apply for a revocation of the order of adjudication is the person

adjudged to have committed an act of insolvency. There is no other provision in the Act relating to the revocation of an adjudication order. Prima

facie, therefore, Haji Jackeira, the present applicant, has no right to apply for an order revoking the order in question. His legal advisers seem to

have realised this difficulty and, therefore, they have introduced the alternative word review and filed a memorandum of review in support of their

application. It seems to me that it does not matter what language, to designate their application is used. This clearly is an application for a

revocation of the adjudication order. Mr. Robertson argued that the Court had inherent power to review its own order and set it aside if the Court

is satisfied that it was improperly obtained or that it never ought to have been made. Reliance was placed on the decision of Mr. Justice Marriott in

In re Thuckur Bhugvandas Hurjivan 4 B. 489, where it was held that the Court had jurisdiction to review its own orders. No one has contested

before me that the Court had no power to review its own orders. What has been most strenuously contested is that the applicant was not the

proper party to make the application for review or revocation. The case referred to has no bearing on the question at issue before me in this rule.

In that case the application for revocation was made by the insolvent himself. He was clearly entitled to make the application under the provisions

of Section 9 of the Act. The Court in the first instance made an order revoking the adjudication. The petitioning creditor, at whose instance the

insolvent was adjudicated, then applied for a review of that order. It was contended on behalf of the insolvent that the Court had no power to

review and the only course open to the petitioning creditor was to appeal. This contention, the Commissioner in Insolvency overruled holding that

the Court had jurisdiction to review its own order and did review and subsequently cancelled the order for revocation. The question before me is

not whether the Court has jurisdiction to review its own order. The question here is who is entitled to invoke the jurisdiction of the Court to review

or cancel the order of adjudication made against the insolvent. The Official Assignee and the petitioning creditor and another creditor all contend

that the insolvent alone can make the application. Mr. Robertson contends that his client, who is damnified by the order, is entitled to apply to the

Court to set aside the order and that if the Court is satisfied that the order is improperly obtained, or is one that ought never to have been made, it

ought to set aside the same at the instance of his client. These contentious are not in the least affected by the decision in In re Thuckur Bhugvandas

Hurjivan 4 B. 489.

Mr. Robertson has cited several English cases before me in the course of his argument but there again one has only to see the widely different

provision in the English Bankruptcy. Act to find at once that in the consideration of the question of the locus standi of the applicant, English cases

cannot be of any help. Whereas Section 9 of the Indian Insolvent Act specifically provides that the order may be revoked upon the petition of the

person adjudged to have committed an act of insolvency the corresponding provision in the English Bankruptcy Act of 1883, 46 & 47 Vic. c. 52,

contained in Section 35, specifically authorises the Court where in its opinion a debtor ought not to have been adjudged bankrupt to annul the

adjudication on the application of any person interested. I find that in the Insolvency Act III of 1909, which will come into force in the Presidency

towns in India in the beginning of next year and supersede the present Act, the provisions of the English Bankruptcy Act have been incorporated

by Section 29. It is clear, therefore, that whereas in England ""any person interested"" may apply to annul the order of adjudication, under the Indian

Insolvent Act, now in force, the insolvent alone can apply to annul the adjudication. If the provision of the English Act had applied the applicant

would have been clearly entitled to have been heard, for there is no doubt that he is vitally interested in having the order of adjudication annulled.

The piece goods shop seized by the Official Assignee is included in his mortgage and he contends that he was in possession of it as such

mortgagee.

The Official Assignee on the other hand asserts that it was within the ""order and disposition"" of the insolvent and he was entitled to take

possession of it under the provisions of Section 23 of the Act. Again the applicant''s mortgage being within two months of the adjudication may

become valueless to him under the provisions of Section 24 of the Act, if the creditors could establish that the charge was voluntarily created. All

this means litigation ahead and the applicant Haji Jackeira is naturally anxious to escape all the risk and worry of litigation by having the order of

adjudication annulled.

If the provisions in the English Bankruptcy Act applied, or if the new Indian Presidency Town Insolvency Act had been in force now, it seems to

me the applicant would have been clearly entitled to be heard but the question is whether he is so entitled to be heard now under the present Indian

Insolvent Act. It is quite obvious that he is not entitled to be heard under the provisions of Section 9. That provides for an application by the

adjudged insolvent alone. There is no other provision in the Act which could be said to authorise any person other than the adjudged insolvent to

apply to have the order of adjudication revoked. Mr. Robertson contended that the Court had inherent jurisdiction to review its own order and if

satisfied that the order ought not to have been made to revoke the same. Although it is held that the Insolvent Court has power to review its own

orders, that power, in my opinion, could only be exercised at the instance of the party entitled to invoke the exercise of those powers. In re

Thuckur Bhagvandas Harjivan 4 B. 489 the Court reviewed its order at the instance of a party to the proceedings. Here the applicant is a stranger

to the adjudication proceedings. He is not besides really damnified. If he was in possession of the piece goods shop he is entitled to establish that

possession by a suit and recover the shop and all its contents from the Official Assignee. If his mortgage in respect of other properties is challenged

as a voluntary conveyance he could defend the action and establish that his mortgage is not fraudulent and void within the meaning of Section 24.

As I have observed before in this matter, English cases cannot be accepted as offering any guide whatever, the provisions in the English and

Indian Acts being entirely different. Take for instance the case principally relied upon by the learned Counsel for the applicant, Ex parte Thoday

(1876) 2 Ch. D. 229 and the appeal therefrom reported in the same volume at page 797. The case was decided according to the provisions of the

Bankruptcy Act of 1869. In this case Bacon C.J. held that the objection to the appellant''s locus standi could not be sustained on the express

ground that he had ""a direct interest in the matter."" This view was upheld by the Court of Appeal. This and other like cases the decision of which

turns on the express provisions of statutes which have no application to India and more especially when the Indian statute contains an expressly

different provision can never be of any use to Indian Courts, I must, therefore, turn to the Indian cases to see if they help the contentions put

forward on behalf of the applicant. Again in turning to Indian cases one must remember that cases of insolvencies not in Presidency towns and to

which the Indian Insolvent Act does not apply are of no value. Proceedings in those cases are under the provisions of a chapter in the Civil

Procedure Code, which are widely different from the provisions of the Act which regulates proceedings in the Presidency towns.

The point for determination in the rule now before me is not without Indian authority. In the matter of William Watson 31 C. 762 it was held

that the English trustee in Bankruptcy had no locus standi in the Calcutta Court to make an application to have the adjudication and vesting order

set aside. In that judgment a matter which was dealt with by Mr. Justice Wilson in 1890 in connection with the insolvency of J. Bell is referred to.

This case is not reported but it is set out fairly fully in Mr. Mitra''s Commentaries on Section 9 of the Indian Insolvent Act at pages 29 and 30. In

that case the wife of the adjudged insolvent was allowed to apply for revocation of an order adjudicating her husband insolvent. She succeeded in

getting the order revoked. In William Watson''s case 31 C. 762 Mr. Justice Henderson in the course of his judgment when referring to Bell''s case

distinguishes the case as a special case"" in which the wife was ""specially interested"". A careful perusal of the notes of Bells case, appearing in Mr.

Mitra''s Commentaries, makes it clear that the case is not distinguishable for the reasons stated by Mr. Justice Henderson. The real reasons for the

proceedings, so obviously in conflict with the provisions of Section 9 of the Indian Insolvent Act, seems to be that nobody raised the question of

the wife''s locus standi and the question whether she was entitled to apply was never before the Court and never considered. Bell''s wife was heard

because no body seems to have raised the question whether she was entitled to be heard. It appears further from the notes of this case that it was

only after the order of adjudication was revoked and the insolvent''s wife applied for an order for her costs, that the question of her exact position

seems to have troubled the Court and the difficulty was solved by the Court holding that she was not entitled to her costs as she was heard only as

amicus curi�. In the face of these facts it is hardly competent to contend that Bell''s case is an authority for holding that any one other than an

adjudged insolvent can apply for an order for revocation of the adjudication. In Mr. Mitra''s book there is another case referred to in his

Commentaries to Section 9, In re Narayandas Chatterji. This matter was before the present Chief Justice of Bengal, then Mr. Justice Jenkins at

Calcutta, in 1898. In this case two persons alleging themselves to be partners of the adjudged insolvent applied for a revocation of the order of

adjudication during the temporary absence of the insolvent from Calcutta. The learned Commissioner here specifically raised the question as to

whether the partners had any locus standi to apply and although Bell''s case was referred to be guarded himself when granting the rule by saying

that he did not intend to decide that the appellants had any locus standi. The report does not show what happened subsequent to the granting of

the rule but it does show that the adjudged insolvent was stated to have gone to his native village to have his family there and the counsel for the

applicants had offered to join the adjudged insolvent as co-petitioner. Possibly this was done and the question of the applicant''s locus standi then

no more arose.

Since I heard arguments on the rule, I have consulted my learned brother Macleod, whose experience in insolvency matters is very large and

very unique, and I learn that there is not a single precedent in Bombay of anybody other than an adjudged insolvent being allowed by the Insolvent

Court to make an application for the revocation of the adjudication order.

Bell''s case in Calcutta seems to be the only precedent in support of the present applicant''s contentions. It seems to me, that case is no

authority whatever for holding that under the Indian Insolvent Act parties other than the adjudged insolvent can apply for are Vocation of the

adjudication order. The question of the applicant''s locus standi was never raised land was never before the mind of the learned Judge who heard

the application during the whole time the rule was heard and decided and it was only when an order for costs was applied for that the difficulty

seems to have occurred to the Court. The difficulty was got over by holding that the Court had heard the applicant merely as amicus curi�. As I

have stated before I do not agree with the view taken of Bell''s case in William Watson''s case at page 777. Bell''s case does not appear to have

been regarded as a ""special case"" nor was the wife allowed to apply because she was ""a person specially interested"". There is one other point in

the case which I must notice here. It was in the course of the argument repeatedly stated by the learned Counsel for the applicant that the adjudged

insolvent was acting in collusion with the petitioning creditor. If that is so there was nothing to prevent him coming to the Court and himself

petitioning the Court for relief and it would still be in his power to nullify all the applicant''s efforts by coming and filing a petition himself in case the

applicant succeeded in getting the adjudication order revoked. If the insolvent himself petitions the Court there would be no remedy whatever left

to the applicant and the insolvency would be bound to proceed and take the ordinary course of all other Insolvency. The litigation which the

applicant tries to avoid would then necessarily follow.

Under these circumstances the only conclusion that I could come to is that the applicant Haji Jackeira Haji Ahmed Patel has no locus standi to

make the present application and [must discharge the rule obtained by him on the 18th of this month.

The Official Assignee was clearly entitled to appear in the interests of the general body of creditors. The applicant Haji Jackeira must pay the

costs of the petitioning creditor as well as those of the Official Assignee. I can make no order for the costs of Mr. Mankar''s client who must bear

his own costs.

All affidavits filed on the rule must be allowed and taken into consideration in taxing costs.