Andhra Pradesh High Court
Judges : L.NARSIMHA REDDY
Dasari Siva Prasada Rao - Appellant
Versus
Pasupuleti Satyanarayana - Respondent
C.R.P.No.2536/05
Decided On : 07-06-05
Advocates Appeared :
Mr.V.V.L.N.Sarma, Mr.V.CH. Naidu
In this case, Schedule “A” of I.P furnishes description of sale deed and “B” Schedule carries list of so-called creditors who are not made parties to IP or IA - Instead petitioners impleaded as respondents.
Order of trial Court - “Heard arguments of P.C. I find that to consider in this regard in the interest of justice. Hence, O.R is directed to take the possession of petition “A” Schedule Property by 10-6-2005 (Verbatim reproduction) - Order does not conform to basic tenets of adjudication, even at an ex parte stage.
Trial Court failed to realize that order affects property purchased by petitioners for consideration much before IP itself came to be filed - It does not contain even a semblance of reasons on basis of which trial Court has come to conclusion to appoint Official Receiver - Admittedly that only property shown in suit schedule is one sold two months prior to filing of I.P - Insolvency Court not conferred with jurisdiction to adjudicate upon transaction which has already taken place before I.P presented.
“Property” - Defined - After adjudication of an individual as insolvent it is “the property of insolvent”, that shall vest in Court, or Receiver appointed for that purpose - It is impermissible for insolvency Court to deal with properties which are not owned and possessed by proposed insolvent - Impugned order, set aside - Official Receiver and trial Court directed to restore possession of land to petitioners forthwith.
( 2 ) THE petitioners purchased a plot of 378 square yards at Chellapalli through separate sale deeds, dated 23-2-2005, from respondents 2 to 6 herein. Few weeks thereafter, they received a notice, dated 14-3-2005, from the 1st respondent to the effect that he lent a sum of Rs. 2,25,000/- to respondents 2 to 6 and that he came to know about the proposal of the latter to alienate the property to defeat his claim. The petitioners got issued a reply, dated 28-3-2005, to the 1st respondent. They stated that they purchased the property from respondents 2 to 6 for valuable consideration through sale deeds, dated 23-2-2005, and that the sale consideration, to their knowledge, was deposited in the Vijaya Bank. They alleged that the so-called liability of respondents 2 to 6 to the 1 st respondent is fictitious. Thereafter, the 1st respondent got issued a rejoinder, dated 16-4-2005 stating for the first time that the transaction between him and respondents 2 to 6 is evidenced by a pronote, dated 18-11-2002.
( 3 ) THE 1st respondent, claiming to be a creditor filed I. P. No. 18 of 2005, on 29-4-2005, the last working day before closure for the summer vacation, in the Court of senior Civil Judge, Avanigadda. He also filed i. A. No. 168 of 2005 under Section 20 of the provincial Insolvency Act, 1920 (for short "the Act") read with Section 151 C. P. C. , to appoint an Interim Receiver to take possession of the a Schedule property, which is covered by the sale deeds, dated 23-2-2005. The trial Court ordered the same. Hence, this revision.
( 4 ) SRI V. V. L. N. Sarma, learned counsel for the petitioners submits that there were absolutely no bona fides on the part of the 1st respondent in filing the IP. , or the I. A. therein. He submits that the 1st respondent was an agricultural labourer and he never had the capacity to lend any amount to respondents 2 to 6. He further contends that though it was clearly mentioned in the IP. as well as the affidavit filed in support of the i. A. that the schedule property was already sold in favour of the petitioners, the trial Court has chosen to appoint an Interim Receiver, that too, without naming the person. Learned counsel submits that the Insolvency Court cannot adjudicate the validity of the transfer of properties, which took place before presentation of the IP.
( 5 ) SRI V. Ch. Naidu, learned counsel for the 1 st respondent, on the other hand, submits that on coming to know that respondents 2 to 6 were alienating the properties, his client took steps by getting notices issued to the petitioners and that it was only with a view to protect his interest, the 1st respondent filed the IP. as well as the I. A.
( 6 ) THE 1st respondent filed I. A. No. 18 (sic. 168) of 2005 under Sections 6,9 and 11 of Act to declare respondents 2 to 6 herein as insolvents. He impleaded the petitioners herein as respondents 6 and 7 in the IP as the purchasers. The only property shown in the schedule to the IP. was a plot of 378 square yards. In the IP the 1st respondent categorically stated that the petitioners herein purchased the said property through separate sale deeds, dated 23-2-2005. The schedule a of the petition furnishes the description of the sale deeds. b Schedule carries the list of the so-called creditors. Apart from the 1st respondent, the names of Miriyala Ramu and t. Venkateswarlu find place in it. Those two persons, however were not made parties to the IP. or I. A. Instead, the petitioners herein were impleaded as respondents 6 and 7 in the I. P. and I. A. It is rather mysterious that the ip. in such a form was registered by the trial court.
( 7 ) THE 1st respondent filed I. A. No. 168 of 2005 under Section 20 of the Act, for appointment of Interim Receiver. It is rather surprisi
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