Vests in Official Assignee on his performing the insolvents part of the contract.

Janarthanam, J.

1. This is an application taken out by the Official Assignee, under Section 17 of the Presidency Towns Insolvency Act, 1908 (for short 'the Act') for a direction to the President, The Ideal Homes Co-operative Building Society Ltd., Bangalore, the respondent herein to execute a registered sale deed in his favour in respect of the property, viz., Plot No. 530, Ideal Homes Project Township, Kenchanahalli, Bangalore said to have been allotted, pursuant the lease-cum-sale agreement dated 14.7.1977 to one V. Parthasarathy, one of the partners of Vummidiar Bankers, which was subsequently adjudged as insolvent on 13.4.1983 on a creditor petition in I.P. No. 9 of 1983.

2. The two facets of opposition emerging from the respondent revolving on law and facts consist of the following:

(1) the interest stated to have been acquired by the insolvent in respect of the said plot of land prusuant to the lease cum sale agreeement entered into by him with the Society can, by no stretch of imagination, be stated to be a property right, in the sense of interest in the immovable property so as to make it vest in the Official Assignee on and from the date of the order of adjudication of the insolvent.

(2) Even otherwise, the said agreement had been determined long before and consequently no direction as sought for by the Official Assignee can be ordered.

3. Let me now engage my attention to the consideration of the first facet of the contention. No doubt true it is that the said agreement is described as a 'lease-cum-sale agreement'. The question is what right is available to the insolvent under this document and whether it vested in the Official Assignee under Section 17 of the Act. The section inter-alia says that on making an order of adjudication, the property of the insolvent, wherever situate, shall vest in the Official Assignee, and become divisible among his creditors.

4. Section 52 of the Act deals with the description of the insolvent's property divisible among creditors. Sub-section (1) of that section enumerates properties which would not vest in the Official Assignee and they are (1) property held by the insolvent on trust for any other person; and (2) tools of his trade and necessary wearing apparel, bedding, cooking vessels, etc. Sub-section (2) is subject to Sub-section (1) and it says that the property of the insolvent shall comprise the particulars mentioned therein. Clause (b) of Sub-section (2), relevant for our purpose, is couched in the following terms The capacity to exercise and to make proceedings for exercising all such powers in or over or in respect of property as might have been exercised by the insolvent for his own benefit at the commencement of his insolvency or before his discharge.

5. Learned Counsel appearing for the respondent would vehemently contend that the right flowing under the lease-cum-sale agreement with the Society is a personal right and' as such is not a property that would vest in the Official Assignee. To appreciate this contention, it is but necessary to refer to some of the clauses in the agreement. The agreement, as already noticed, is styled as 'Lease-cum-sale agreement'. The insolvent is described as 'lessee-purchaser'. Though the document refers to the parties as 'lessor' and 'lessee' the dominant intention underlying the document is to create a sale agreement providing for the payment of the price of the land in accordance with the terms stipulated therein. It is provided that until such time as the lessor conveys property to the lessee, the lessee shall occupy the property as lessee on terms and conditions mentioned therein. It is provided in Clause (12) that the lessor should sell the property to the lessee at the end of ten years as referred to in Clause (1), and the lessee is required to pay to the lessor the purchase price of the property and the incidental expenses such as stamp duty etc. Clause (10) provides that in case the lessee defaults in paying the amounts, as provi