RACHAMADUGU RANGIAH Vs. YVAPPAJI RAO

JUDGEMENT

(1.) These appeals are against the order of the District Judge of Anantapur annulling certain transfers of property under Section 53 of the Provincial Insolvency Act. It is contended for the appellants that Section 53 of the Act does not apply as the transfers of property were more than two years before the date of the adjudication of the insolvent. Ft is urged that the expression "is adjudged insolvent" can only refer to the adjudication of the insolvent and not to the date of the presentation of the petition on which the adjudication was made. The question for determination is, does an application to set aside a voluntary transfer lie under Section 53 of the Provincial Insolvency Act if the transfer is more than two years from the date of the order of adjudication but within two years from the date of the presentation of the petition on which the adjudication was made? This point is covered by authority so far as our High Court is concerned.

(2.) In Sankaranarayana Aiyar V/s. Alagiri Aiyar Oldfield and Sadasiva Aiyar, JJ., considered this point at considerable length and came to the conclusion that the adjudication referred to in Section 36 of the old Act had to be treated as made on the date of the presentation of the petition on which the insol-vent was adjudicated. It is contended that this decision is wrong and is opposed to the view of the Bombay and Lahore High Courts. The argument is that under Section 53 the period of two years is to be calculated backwards from the date of adjudication as the clause "if the transferor is adjudged insolvent within two years after the date of the transfer" can only mean the date of the order of adjudication and not the date of the presentation of the petition on which the adjudication is made, that Clause 7 of Section 28 cannot govern the plain meaning of the words in Section 53, and if the Legislature intended that the two years should be calculated backwards from the date of the presentation of the petition the expression "is adjudged insolvent" would not have been used, for in Section 54 it is clearly enacted that the transfer should be within three montijs of the petition presented for adjudication. No doubt there is a difference between the wording of Section 53 and that of Section 54. In Section 53 the clause is Any transfer... shall, if the transferor is adjudged insolvent within two years after the date of the transfer, be voidable....

(3.) Section 54 is Every transfer of property... shall, if such person is adjudged insolvent on a petition presented within three months after the date thereof, be deemed fraudulent and void....