F.I. Rebello, J.

1. 1. The judgment creditors based on the judgment and decree passed in their favour in Summary Suit No. 5217 of 1999, consequent to an order rejecting the Summons for Judgment No. 26 of 2002 took out a Notice under Section 9 of the Presidency Towns Insolvency Act. They would hereinafter be referred to as the petitioners, the judgment debtor hereinafter shall be referred to as the respondent. The judgment debtor/respondent by the present Motion have moved to set aside the Insolvency Notice.

2. 2. A few facts may be set out. The petitioners filed a Summary Suit before this Court being Summary Suit No. 5217 of 1999. On appearance being filed by the respondent Summons for Judgment came to be taken out. Respondents sought leave to defend. After examining the defences as raised a learned Judge of this Court held that defences as raised by the defendants are without any substance and dishonest. Consequently the Summons for Judgment

deserved to be granted and accordingly allowed the same. The defence by the respondent was that the dishonoured cheque on which the Summary Suit was filed was given as a security and in those circumstances the petitioner was not justified in presenting the cheque to the bank for payment. Secondly it was urged that the pledged shares had been sold without complying with the requirements of Section 176 of the Contract Act. It was submitted that once petitioner had submitted the cheques to the bank for payment the petitioner was not entitled to sell the shares. The learned Judge after hearing the contentions held that considering the material on record; the post-dated cheques were given by the respondent pursuant to the letter of the petitioner dated 10th June, 1996 and not as a security. The respondent had requested the petitioner to wait for three months and not to sell the shares on the promise that the respondent will pay the loan. The cheques which when presented were dishonoured. It is then stated that the petitioner took steps to sell the shares. It is in these circumstances the Court held that there was no substance in the plea raised by the respondent. It was submitted before the Court that the respondent had filed a suit for recovery of damages against the petitioner for wrongfully selling the shares which were pledged by the respondent with the petitioner. The Court opined that the suit was filed by the respondent for recovery of damages for wrongfully selling the shares. The learned Judge did not find any merit in that contention. An appeal was preferred consequent to a decree being passed under Order XXXVII of the Criminal Procedure Code. That appeal came to be dismissed pursuant to which the respondent herein filed

S.L.P. before the Apex Court which came to be rejected on 13th September, 2002.

3. In support of his contention that the Notice be set aside learned Counsel for the respondent has basically formulated the grounds as under :--

.(i) That the judgment debtor has a counter-claim or set off against the judgment creditors which is equal to or in excess of the amount due under the decree and which he could not in law for the time being in force prefer in the summary suit in which the decree was passed;

.(ii) The decree is not executable under the provisions of law on the date of the application;

(iii) The decree has been induced on the basis of material misrepresentation and on the basis of palpable false statements made by the judgment creditor in the Summary Suit which renders the decree null and void and being incapable of execution.

4. In answer on behalf of the petitioner creditor, it is contended that the issue that the judgment creditors are secured because the judgment creditors possessed 4,000 shares of Sesa Goa Ltd., belonging to the father of the judgment debtor and the judgment debtor has a counter claim in the form of a Suit No. 1673 of 1998, challenging the sale of 35,000 equity shares by the Judgment Creditors, which were pledged by the judgment debtor