A T P SHIVACHANDRA Vs. SWARNA SILK HOUSE

JUDGEMENT

(1.) This is an appeal purporting to be under S.75 (2) of the Provincial Insolvency Act, hereinafter referred to as the Act. It is preferred by the respondent in Insolvency Case No.12/67 on the file of the Second Additional District Judge, Bangalore, and is directed against an Order made therein on 4-2-1970 whereby it was held that the insolvency application . was maintainable.

(2.) The few relevant facts are as follows: The appellant was a partner of Swarna Silk House a partnership firm consisting of three partners. It is alleged that the appellant was only a working partner and as such entitled to draw not more than Rs.3,000 a year from the firm, subject to a share in the profits. The respondents' case is that in a certain year the appellant drew Rs.26,000 and odd in excess of the amount permissible as per the agreement of partnership. It would appear, he had alienated the only property standing in his name in favour of his wife for a nominal consideration of Rs. 1,000. Presumably, it is this conduct on his part that is construed as an act of insolvency by the remaining partners for founding the present petition under S.9 of the Act.

(3.) It is averred in the petition that the partnership firm was under a process of voluntary winding up. Further, it is stated that on taking accounts for the year ending 22-10-1967, and on the information furnished by their auditor, amount that was actually found due from the appellant to the firm was Rs. 26,053-25. The appellant, therefore, is indebted to the extent of the aforesaid sum.