Official Assignee of Madras vs G. Ramanujayya

Waller, J.—Application for summons against Goday Ramanujayya, Cloth Merchant, Amalapuram, Godavery District. The question

originally raised was as to the regularity of issue of this summons and whether the Official Assignee is entitled to apply for the issue of a summons,

u/s 36 of the Act, to compel a witness under that section to appear when such witness resides at a distance of over 200 miles from the Court

House. In other words, can a summons be issued u/s 36 to compel a witness residing over 200 miles from Madras to attend and give evidence.

After the argument had been addressed to me on this section Mr. V. Varadaraja Mudaliar, on behalf of the Official Assignee, said that the

summons in this case was not issued or applied for u/s 36 of the Act but was applied for u/s 7 of the Act, or, in the alternative, that it was applied

for under either Section 36 or Section 7. As the matter has been fully argued before me, I shall record my views on both sections and discuss the

various authorities cited before me.

The first case referred to is the judgment in O.S. A. No. 30 of 1917. That is an unreported case in which it was held that a summons u/s 36,

when it merely asks for production of documents, can be issued, as there is no question of the attendance of a witness, as it is always possible for

the documents required to be sent by post or by a messenger. That decision does not decide that the Court has, or has not, power to issue a

summons to compel the attendance of a witness, who resides over 200 miles from Madras, but it merely draws a distinction between a summons

to produce and a summons to attend and give evidence and holds that a summons to produce whether under the Code or u/s 36, Insolvency Act,

can be issued, as the order can be complied with by causing the document to be produced, which, under Order 16, Rule 6 of the Code, is a

sufficient compliance of the summons. The judgment, therefore, cannot be looked upon as a decision that a summons to give evidence u/s 36 can,

or cannot, be issued where a witness resides more than 200 miles from Madras. The important words in that decision appear to be the portion in

which it is stated that reading Sections 36 and 37, Insolvency Act, together and also the original side rules, the Court is governed by Order 16 of

the Code and by the original side rules in respect of orders u/s 36. Mr. V. Varadaraja Mudaliar contends that Section 36 is not controlled by the

provisions of the Code. He contends that the insolvency Court is constituted under Clause 18, Letters Patent. I do not agree with him. The Court

for the relief of insolvent debtors was established by the Act of 1848, which was in force before the Letters Patent were framed. What happened

was that certain laws are constituted by certain enactments relating to insolvent debtors in India and Clause 18 provides for the execution by one of

the Judges of the High Court of laws relating to insolvent-debtors.

I shall refer later to some cases cited by. Mr. V. Varadaraja Mudaliar in which it had been held that insolvency Courts in India have jurisdiction

throughout the British dominions, but it should be noted here that, if the insolvency Court has jurisdiction throughout the British dominions, the

wording of Clause 18, Letters Patent, only gives the Judge in insolvency power to exercise jurisdiction within the Presidency of Madras. The point,

however, I wish to emphasize is this: The insolvency Court, or the Court for the relief of insolvent-debtors, is not constituted by Cl.18, Letters

Patent, but that that clause gives one of the Judges of the High Court the power to exercise jurisdiction under the insolvency Act. Jurisdiction to

grant relief to insolvent-debtors in India is derived from an Act of Parliament of 1829 known as the First Indian Insolvent Act. The Court had a

separate existence from the Supreme Court, but it was presided over by a Judge of the Supreme Court. In 1848 the Indian Insolvency Act was

passed and the insolvency Courts were continued by it and the Court was to be holden before any one Judge of the Supreme Court. This Act of

1848 was in force in 1862 when the High Court was established and the effect of Clause 18 is to give a Judge of the High Court, instead of a

Judge of the Supreme Court, power to exercise jurisdiction in the insolvency Court. Similarly, under the present Act, Section 3, it is provided that

the Courts having jurisdiction in insolvency under the Act shall be the High, Courts and that the jurisdiction shall be exercised by one of the Judges

assigned by the Chief Justice u/s 4.

Under the old Act, therefore, the insolvency Court was established by the Act and the Judges of the Supreme Court; and later the High Court

were authorized by the Letters Patent to exercise jurisdiction. Under the present Act jurisdiction is given by the Act and it is to be exercised by the

Judge assigned by the Chief Justice.

So far as the framing of rules is concerned, Section 76, Insolvency Act, 1848, gave power to His Majesty''s Supreme Courts to make all

necessary and reasonable rules not inconsistent with the provisions of the Act for facilitating and carrying into effect the relief intended to be given

by the Act, and under the present Act, Section 112, the Courts having jurisdiction under the Act, that is, High Courts, have power to make rules

for carrying into effect the objects of the Act. I do not consider it necessary for me to state here whether the High Court has power to frame a rule

to the effect that a summons may be issued u/s 36 to compel a witness, who resides more than 200 miles from Madras, to attend and give

evidence. It is sufficient for me to state that whether the Court has, or has not, this power, it has framed no rules to this effect. There is nothing ''in

the insolvency rules on the subject and it is therefore necessary to refer to the original side rules to determine the question, as, u/s 90, Presidency

Towns Insolvency Act, it is: provided that, ''in proceedings under the Act, the Court shall have like power and follow the like procedure as it

follows in the exercise of its ordinary civil jurisdiction.

Has the High Court, in the exercise of its ordinary original civil jurisdiction provided for a procedure by which a witness, who resides at a

distance of more than 200 miles from Madras, can be compelled to attend before it? There is no such rule on the original side and the practice is

not to issue subpoenas to witnesses, who reside more than 200 miles from the Court, to attend. The question, however, is not one of practice,

Order 1, Rule 3, Original Side Rules provides that the provisions of the Code so far as such provisions are inconsistent with these rules and forms

are repealed. In other words, the provisions of the Code apply to the original side unless they are inconsistent with the rules. It is only necessary to

refer to Sections 117, 121 and 129 and Order 49, Rule 3 of the Code to see that this is so. The Code is generally applicable to the High Court in

the exercise of its ordinary original civil jurisdiction, except where it is specifically excluded, or where the High Court itself has made rules

superseding any particular provisions of the Code.

The result is that Order 16 of the Code (with the exception of Rule 2 of the order which has been excluded by Order 49, Rule 3 (3) of the

Code) applies to the High Court in the exercise of its ordinary original civil jurisdiction and that the insolvency Court must follow the same

procedure u/s 90 of the Act. The insolvency Court has not by its rules provided for a procedure under which a witness, who resides more than

200 miles from Madras, can be compelled to appear before it. I, therefore, hold that a summons cannot be issued to a person who resides more

than 200 miles from Madras, directing him to attend and give evidence u/s 36.

The decision cited by Mr. V. Varadaraja Mudaliar In re Cowasjee Mokerjee [1889] 13 Bom 114 does not, in my opinion, apply. In that case

the application was to direct the insolvent, who had submitted to the jurisdiction of the Court, to attend for examination. In the present case, the

application is to direct a stranger to the insolvency proceedings to attend before the Court and the insolvency Court has wider powers to enforce

the attendance of an insolvent than it has over a stranger to the proceedings. In in re Naoroji Sorabji Talati [1909] 33 Bom. 462 it was held that

the insolvent-debtors'' Court at Bombay can order the examination of a witness in Shanghai, but cannot direct a witness at Shanghai to come to

Bombay to be examined. The position in the present case is practically the same as, although the Court can order the examination of the witness,

there is no machinery by which he can be compelled to attend. In Ganesh Das v. R.S.D. Chopra [1908] 32 Bom. 198, it was also held that the

Court has jurisdiction to make an order u/s 26 of the old Act against persons holding the property of the insolvent and who are outside the

Bombay Presidency. The question in the present case is not the distance to which the orders of the Court extend, but up to what distance the

attendance of a stranger to the insolvency can be enforced Again the decision in Official Assignee Bombay v. Registrar, Small Causes Court,

Amritsar [1910] 37 Cal. 418 lays down that the Imperial Act conferred jurisdiction upon the High Courts in insolvency over the whole of India and

for some purposes over much wider limits. The question in the case was whether the property in the Punjab had vested in the Court so as to

exclude the operation of the Bombay vesting order and the Privy Council held that the property had vested in the Official Assignee, Bombay. The

case is not of much assistance in disposing of the present question. The case, Official Assignee Madras v. Vadavalli Ammal [1917] 40 Mad. 810,

relates more to jurisdiction than to procedure and it decides that the Court has jurisdiction to adjudicate on claims relating to immovable property

situate outside the limits of the ordinary original civil jurisdiction. There is nothing ins that decision to indicate whether or not a witness, who resides

over 200 miles from the Court, can be summoned to attend and give evidence. The Full Bench decision in I. P. 267 of 1923 affirms 40 Madras

and holds that the insolvency Court has jurisdiction u/s 7 of the Act to decide questions in insolvency where the garnishee lives outside its

jurisdiction and that Clause 12, Letters Patent does not affect the provisions of Clause 18.

I do not think that the question that the Court has a discretionary power to decide claims to property or claims against persons outside its

jurisdiction is material to the present question, which is whether the Court can enforce the attendance of a witness.

The second point raised by Mr V. Varadaraja Mudaliar in his argument is that his summons is not being issued u/s 36, but u/s 7 of the Act. On

this point, I say that Section 7 merely confers jurisdiction to decide all questions that may arise in an insolvency, but it does not provide for a

procedure by which strangers to the insolvency proceedings can be brought before the Court. The only section, which so provides, is Section 36.

I, therefore, hold that a summons cannot be issued u/s 7 of the Act.

After I had passed the above order, Mr. Albuquerque drew my attention to a case, not cited by In Re: Dinaram Somani and Others, in which

it has been held that the High Court Calcutta, has jurisdiction to summon witnesses residing more than 200 miles from Calcutta u/s 36 and that

Order 16, Rule 19, Civil P.C., does not apply to summonses u/s 36. This decision is in conflict with the judgment in O.S. A. 30 of 1917 of the

Madras High Court in which it has been held that in respect of orders u/s 36 of the Act the Court is governed by the provisions of Order 16 of the

Code and by any rules relating to the same matter to be found in the original side rules.

The result of all the decisions appears to me to indicate that the High Court has jurisdiction to try questions that arise even though they arises

over 200 miles from Madras and jurisdiction to examine witnesses residing over that distance, but there is no procedure or machinery by which a

witness can be compelled to come to Madras from a distance over 200 miles.

As however, the matter is one of great importance to the Official Assignee and to the profession, I think the most satisfactory course is to refer

the matter to the Court for a ruling.

JUDGMENT

I say nothing about the case of a person who is to be summoned as a mere witness u/s 36 of the Act, for that case does not arise. The person

to be summoned here is not a mere witness, but a person supposed to be a debtor to the insolvent''s estate. There is, as was observed in (1905) 1

Ch. 749, a litigation between him and the Official Assignee: vide also (1877) 6 Ch. D 328, where the same distinction is made. My answer to the

reference is that the Court has jurisdiction to summon the party. Taxed costs out of estate.