Wanchoo, J. - (1.) This is an appeal by special leave in an insolvency matter. The brief facts necessary for present purposes are these. S. V. N. Nanappa Naicker and his sons were adjudged insolvents on an application of Smt. Engammal (hereinafter referred to as the respondent). They had preferred an appeal before the High Court of Madras but it was dismissed on April 17, 1953. Thereafter the official receiver took steps to sell the property of the insolvents, which consisted of two lots, the first lot camprising 145 acres 10 cents of dry land and a masonry house, and the second lot 8 acres and odd of dry land. Both these properties were subject to mortgage. The official receiver fixed September 28, 1953, for sale of the properties by auction. Fifteen of the creditors were present when the sale by auction took place, including the son of the respondent. No request was made on that day by anyone for postponing the sale and consequently bids were made. The highest bid for lot 1 was of Rs. 4,500/- and the highest bid for lot 2 was of Rs. 70/-. Both these bids were made by the appellant who is a brother-in-law of Nanappa Naicker. The reason why the two lots were sold for Rs. 4,570 was that there was an encumbrance on the entire property of Rs. 17,200/-. The official receiver did not close the sale on that day in the hope that some higher offers might be made by the creditors and postponed it to various dates up to October 26, 1953. On all these dates; the respondent's son was present but no higher offer was made on behalf of the respondent. On October 26, 1953, an application was made on behalf of the respondent praying that the sale be postponed for another three months apparently on the ground that there had been drought in that area for some years past and agricultural lands were not fetching good price. The official receiver, however saw no reason to postpone the sale, particularly when no higher offer was forthcoming from the side of the respondent and decided to knock down the properties in favour of the appellant
(2.) Later, an application was made on behalf of the respondent on November 18, 1953 under S. 68 of the Provincial Insolvency Act, No. V of 1920 (hereinafter referred to as the Act). The case of the respondent was that the sale had been made for a very inadequate price and there had been drought in the village for several years in the past and there was very great stringency in the money market and it was hoped that if the sale was postponed for there or four months, the properties would fetch a good price of not less than Rs. 15,000/-, exclusive of the sum due on the encumbrances. The respondent also stated that if the sale was postponed for three months she would be prepared to bid more than Rs. 7,500/- for the properties. There were some other allegations in the petition suggesting collusion between the official receiver on the one side and the insolvent and the appellant on the other. The respondent therefore prayed that the official receiver should be ordered not to sell the properties to the appellant at the price bid by him. The application was opposed by the official receiver as well as by the appellant. The official receiver contended that he had done his best and that no higher bid could be obtained. He also denied the allegation made against him in the nature of collusion and also about the manner of conducting the sale.
(3.) The Subordinate Judge allowed the application on the ground that the price fetched was low and that the general body of creditors to whom debts to the extent of Rs. 30,000/- were payable would be considerably prejudiced if the sale was allowed to stand. Thus the only ground on which the application under S. 68 was allowed was that the price fetched was low.;