Ponnammai Ammal vs The District Official Receiver and Another

The Official Receiver is not represented. A.A.O. No. 178, the document attacked in this case, is Ex. IX. The only evidence for the Official

Receiver regarding it is P.W. 2, whose evidence strikes us as much inferior to that of P.W. 5, who is in no way related to the insolvent. The latter

swears that money was paid on the mortgage. There is no evidence that about the date of mortgage Palavesa Kone was in insolvent circumstances

and anxious to screen his property from pressing creditors. We consider that there is no ground for holding that Ex. IX is a transfer in fraud of

creditors. Ex. IX ripened into a decree and that decree was transferred by Ex. VIII to 4th respondent. There is no finding by the Judge that Ex.

VIII was not for value or in good faith. On the merits we see no reason why Exs. VIII and IX should be declared void as against the Official

Receiver.

A.A.O. No. 179 of 1923 :-The judgments on the merits in this case follows the above. If Ex. IX is a genuine mortgage then the consideration

for Ex. I is wholly genuine, as the learned Judge has found that the balance of the consideration apart from Ex. IX was actually paid. Ex. I must

therefore also stand good.

A.A. 0. No. 129 of 1923 :-The transfer from the insolvent in this case is Ex. X. Though no doubt there was a sale by him to his son-in-law the

only evidence in this case is that the sale amount was paid; here also there is no evidence that at the time of Ex. X the insolvent was in such

circumstances that he would be anxious to secrete his property from his creditors. We consider the evidence adequate to uphold Ex. X. That being

upheld, the Official Receiver cannot attack Ex. XI, the transfer by the vendee under Ex. X to 5th respondent. These documents, therefore, must

also stand.

A legal point as to the scope of Section 53, Provincial Insolvency Act of 1920, has been taken before us, viz., that under it the Official Receiver

is not at liberty to attack a transfer from a transferee of the insolvent. The language of the section favours this view since it is the ""transferor"" who is

the insolvent. This view is supported by a ruling reported in Sudha v. Nanak Chand Daulat Ram (1925) vii L L.J. 160 and the ruling of Oldfield, J.

in A.A.O. No. 159 of 1918 reported in Jagannadha Aiyangar v. Narayana Aiyangar (1919) 52 I.C. 761. We are inclined to agree with the

remarks of the latter on this point in that judgment including the ground on which he distinguishes the English cases cited by him but may point out

that in both the cases In re Vansittari: Ex parte Brown (1893) 2 Q.B. 377 the transfer was upheld and not set aside as Oldfield, J. states. A more

recent case In re Hart: Ex parte Green (1912) 3 K.B. 6 has been cited to us, which carries on the principle laid down in the II Q.B. cases and

applies it even to a case where the transfer from the original donee from the insolvent was subsequent to the act of bankruptcy. We need not

however pursue the matter further here.

We allow the appeals and set aside the Lower Court''s order in toto and dismiss the Official Receiver''s petitions with costs throughout in all the

three cases.