TULZAPURKAR,J. - (1.) THIS is a creditor's petition whereby an adjudication order is sought against the four debtors viz. (1) Bhimji Nanji and Co., a partnership firm, (2) Mauji Arjan Patel, (3) Bhimji Nanji Patel and (4) Manji Mauji Patel, the last three being partners of Bhimji Nanji and Co, The petitioning -creditor has alleged that on February 22, 1962, a sum of Rs. 5,000 was borrowed by the debtors with interest at 8 annas per cent, per mensem, that in respect of the said borrowing a Khata writing was passed by the said firm of Bhimji Nanji and Co. in her favour on the same date and that under the said writing the said amount together -with interest thereon at the agreed rate was payable after 3 months i.e. on May 21, 1962 or earlier, if demanded. The petitioning -creditor has further alleged that the aforesaid debt together with the interest aggregating to Rs. 5,433.33 had become due and payable by the debtors to her at the time of presenting the petition but was not paid inspite of repeated demands. The petitioning -creditor has further alleged that the debtors: have committed two -three acts of insolvency viz. (1) the debtors have with intent to defeat and delay their creditors transferred their property or substantial part thereof viz. the business carried on by them in partnership in the firm name and style of Bhimji Nanji and Co. together with the stock -in -trade, furniture, fixtures, fittings and outstandings thereof as a going concern together with the goodwill thereof and the tenancy rights of the said shop to Chhotalal Gulab -chand Damani and Nanji Mavji Patel and that the said transfer amounted to fraudulent preference, (2) that the debtors had departed from the usual place of business or from their dwelling house and have otherwise absented themselves and (3) that the debtors have secluded themselves so as to deprive their creditors of the means of communication with them and have thereby impliedly given notice to their creditors of suspension of payment of their debts. On these allegations the petitioning -creditor has prayed for an order of adjudication against the debtors.
(2.) APART from challenging the allegations pertaining to the several acts of insolvency said to have been committed by them, the debtors have contended that the petition is liable to be dismissed as the debt no longer subsists. Mr. Dhanuka raised the plea that the debt on the basis of which the present petition has been filed by the petitioning -creditor has become barred by the law of limitation to -day i.e. at the date of the hearing of the petition, and, therefore, no adjudication order could be passed against the debtors. It was not disputed before me by Mr. Shah, appearing on behalf of the petitioning -creditor that the debt on the basis of which the present petition has been filed by the petitioning -creditor has become barred by the law of limitation on the date of the hearing. He fairly conceded that there was no acknowledgment nor any part payment which could save the bar of limitation and that no suit had been filed by the petitioning -creditor within the period of limitation to recover the debt. He, however, urged that it was not necessary in law that the debt on the basis of which the debtors were sought to be adjudicated insolvent should be a subsisting debt at the date of the hearing. He pointed out that on August 10, 1963, when the petition Was presented the debt was subsisting and the debtors were truly and justly indebted to the creditor in the sum of Rs. 5,433.33 and that was enough and the Court should pass the adjudication order against the debtors on proof of several acts of insolvency in respect whereof he wanted to lead evidence. Mr. Dhanuka, appearing on behalf of the debtors, however, urged that there would be no occasion for this Court to record evidence on the several alleged acts of insolvency on the part of the debtors, inasmuch as, according to him, the debt should subsist not only at the time of the presentation of the petition but also at the date of hearing and in fact right upto the time of the passing of the order and the present petition was liable to be dismissed solely on the ground that the debt has become time barred and is no longer subsisting.
(3.) IN view of these rival contentions an issue was raised before me in the following terms: Whether the debt on the basis of which the petition for adjudication is presented and an adjudication order is sought should be a subsisting debt at the date of the hearing of the petition or is it enough that it subsisted at the date of the presentation of the petition?;