Interpretation of attachment before judgment for insolvency purposes and acceptance of creditor's affidavits as true

Alfred Henry Lionel Leach, C.J.

1. The appellants have been adjudicated insolvents by an order of this Court, dated the 28th October, 1941. They challenge the validity of that order on two grounds. In the first place they say that no act of insolvency was committed, and in the second place that the evidence does not prove that there was a debt due to the petitioning creditor on the date of his application.

2. On the 29th January, 1941, a creditor, who had filed a suit against the appellants, obtained an order for the attachment before judgment of certain immovable property belonging to them. The suit was successful, and on the 27th July, 1941, a decree was passed against the appellants for Rs. 10,500. On the llth September, 1941, the decree-holder applied for the sale of the property which was already under attachment. The petition for adjudication of the appellants was filed on the 17th October, 1941, and the act of insolvency alleged was that the debtors property had been under attachment for more than 21 days. Section 9 (e) of the Presidency Towns Insolvency Act states that a debtor commits an act of insolvency

if any of his property has been sold or attached! for a period of not less than 21 days in execution of the decree of any Court for the payment of money.

The appellants contend that C1. (e) of Section 9, does not apply in this case. They, say that as the attachment was effected before judgment, it cannot be deemed to be an attachment in execution of the decree.

3. Order 38, Rule 11 of the Civil Procedure Code provides that where property is under attachment before judgment and a decree is subsequently passed in favour of the plaintiff, it shall not be necessary upon an application for execution of the decree to apply for a re-attachment of the property. Therefore, where property has been attached by an order of attachment before judgment and the plaintiff obtains a decree for payment of money, all that he has got to do is to apply for an order of the Court directing the sale of the property attached. When such an application is made, the attachment automatically becomes an attachment in execution of the decree. In my judgment, no other construction is open. If, however, authority is wanted, it is to be found in Meyyappa Chettiar v. Chidambaram Chettiar (1923) 46 M.L.J. 415 : I.L.R. Mad. 483 and in Dalayya v. Swidara Narayana AIR1936Mad91 . In Meyyappa Chettiar v. Chidambaram Chettiar (1923) 46 M.L.J. 415 : I.L.R. Mad. 483, the question was whether the words "property attached in execution" to be found in Order 21, Rule 57, Civil Procedure Code include property attached before judgment, when there has been a decree followed by an execution petition for the purpose of bringing the attached property to sale. The majority view was that those words did include property attached before judgment. Waller, J., observed that once it has been found that for one purpose an application to execute converts an attachment before judgment into an attachment in execution, the conclusion is inevitable that the conversion operates for all purposes. He added that the same question had been argued before him with reference to Section 9 of the Presidency Towns Insolvency Act, and in this connection said:

Under that section, an act of insolvency is committed where any part of a mans property has been attached in execution of a decree for over 21 days. It would, in my opinion, be anomalous to hold that an attachment before judgment takes the judgment-debtor out of the section, even though execution had been proceeding against his property for more than the prescribed period.

In Dalayya v. Smidara Narayana AIR1936Mad91 , Varadachariar, J., delivering the judgment of the Bench said,

As a question of principle, if an attachment before judgment can be treated as an attachment for purposes of execution at all, it is difficult to see what necessity there is for an order of Court. A more reasonable view seems to us to be to hold that from the time