JUDGMENT- Mrs. SUJATA MANOHAR, C.J.:----Leave to amend in terms of the draft. Amendment to be carried out within one week.

2. This is an appeal from an order of the learned Single Judge in Notice of Motion No. 52 of 1993 in respect of an Insolvency Notice No. N/51 of 1992. The Notice of Motion was taken out by the judgment debtor for setting aside Insolvency Notice issued and served upon him by the judgment creditors. The Insolvency Notice is in respect of a decree dated 12th March 1991 for a sum of Rs. 20,79,184/- passed by this Court against the judgment debtor in favour of the judgment creditor in Summary Suit No. 3760 of 1989. A special leave petition filed from this judgment and decree was rejected by the Supreme Court in April 1991.

3. On 13th July 1992 the judgment creditor moved the Insolvency Court for issuance of an Insolvency Notice. This was because the decree which was then about a year old had remained unsatisfied and there was no stay against the execution of the decree. The Insolvency Notice was issued on 13th July 1992. The record shows that a number of attempts were required to be made for service of the Insolvency Notice on the judgment debtor because the judgment debtor could not be found. According to the judgment creditor, the judgment debtor deliberately evaded or avoided service of the notice. The time for effecting service was extended, therefore, from time to time by the Insolvency Registrar. Within the extended time Insolvency Notice was served on the judgment debtor on 12th April 1993.

4. It is the contention of the appellant who is the judgment debtor that Insolvency Notice is bad in law because service of the Insolvency Notice was effected on the judgment debtor more than 2 years after the passing of the decree against the judgment debtor. Reliance was placed in support of this contention upon the judgment of this Court in the case of (Bhurmal Kapurchand Co. v. P.M. Tools Co.) 1, A.I.R. 1977 Bom. 305. In that case on the date when the judgment creditor applied for issuance of an Insolvency Notice the decree was more than two years old. The learned Single Judge observed that in order to sustain an Insolvency Notice the judgment debt must be an enforceable decree. Since the decree was more than two years old when the Insolvency Notice was applied for, the judgment creditor ought to have obtained leave under Order 21, Rule 22 in order to make the decree executable before he could apply for issuance of an Insolvency Notice. The learned Single Judge has also observed that issuance of insolvency notice is an equitable mode of execution of a decree or order. The ratio of this judgment has no application to the facts of the present case because clearly on the date of issuance of the Insolvency Notice the decree was executable and no leave was necessary under Order 21, Rule 22 on the date of issuance of the insolvency notice.

5. Assuming that an insolvency notice is a mode of equitable execution of the decree, the argument which is advanced before us seems to proceed on the assumption that during the pendency of the execution proceedings also, every two years, the judgment creditor must keep on applying for leave under Order 21, Rule 22. There is no such provision in the Code of Civil Procedure. What is required to be considered is whether there is an enforceable decree on the date when the insolvency notice is issued. In the present case there was an enforceable decree on the date when the insolvency notice was issued. Insolvency notice has been served on the judgment debtor within the time provided under the order of the Insolvency Registrar. The case of Bhurmal (supra) has no application to the present case.

6. The appellant also relied upon a decision in the case of (A.D. Gandhi v. S.L. Thakurdas)2, 77 Bom.L.R. 119 in support of his contention that the Insolvency Court has power to consider the effect of a subsequent event on the validity of the insolvency notice even if at the point

Click Here to Read the rest of this document