VELOO Vs. OFFICIAL RECEIVER DISTRICT COURT ALLEPPEY
HIGH COURT OF KERALA
OFFICIAL RECEIVER, DISTRICT COURT, ALLEPPEY
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(1.) The counter petitioner in CMP. 362 of 1959 in I. P. 24 of 1958 filed by the Official Receiver, Alleppey, under S.55 of the Travancore - Cochin Insolvency Act 1955 (Act II of 1956) is the appellant.
(2.) One Sarojini Amma has been adjudicated insolvent in I. P. 24 of 1958 on the file of the Subordinate Judge's Court, Alleppey at the instance of the creditor CPW. I. The appellant before this court obtained a decree in O. S. 599 of 1955 on the file of the Munisiff's Court, Shertalai, against Sarojini Amma and in execution of the said decree purchased the property scheduled to CMP. 362 of 1959 in court auction on 31-7-1956 for a sum of Rs. 810-13-9. The sale was confirmed on 30.8.1956. The court sale was relied on as an act of insolvency in I. P. 24 of 1958. The Official Receiver filed CMP. 362 of 1959 for annulment of the court sale in O. S. 599 of 1955. The application was allowed by the learned Subordinate Judge of Alleppey and the decision was confirmed in appeal by the learned District Judge of Alleppey. The second appeal is directed against the decision of the learned District Judge.
(3.) It is agreed on behalf of the Official Receiver that the relevant provision applicable is S.55(1) of Travancore - Cochin Insolvency Act (Act II of 1956) which reads thus:
"S.55 Avoidance of preference in certain cases.
(1) Every transfer of property, every payment made, every obligation incurred, and every judicial proceeding taken or suffered by any person unable to pay his debts as they become due from his own money in favour of any creditor, with a view of giving that creditor a preference over the other creditors, shall, if such person is adjudged insolvent on a petition presented within three months after the date thereof, be deemed fraudulent and void as against the receiver and shall be annulled by the court."
Sub-s.(2) of S.55 is not relevant for the case on hand and is therefore not reproduced here. According to the Official Receiver, the court sale in favour of the appellant is a 'judicial proceeding suffered' by Sarojini Amma, with a view, of giving the appellant preference over her other creditors. The question to be decided is how far the plea of the Official Receiver has been established.;
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