The main legal point established is that under the Provincial Insolvency Act, the exclusion period for limitation is from the date of adjudication to the date of annulment, and an acknowledgment of liability made before the expiration of the prescribed period extends the limitation period.

Venkataramana Rao, J.

1. This appeal raises a question of limitation. The suit was to recover a sum of money due in respect of two promissory notes dated 7th May, 1922, executed by the defendant in favour of the plaintiff. Subsequent to the execution of the promissory notes, the creditors, presented a petition in insolvency on 7th November, 1922, to adjudicate the defendant an insolvent. The order of adjudication was passed on 21st March, 1923. The adjudication order was annulled on 5th April, 1928. The suit was instituted on 23rd October, 1930. The plaintiff seeks to escape the bar of limitation by alleging that he is entitled to exclude the whole period during which the proceedings in insolvency were pending, that is, from 7th November, 1922, the date of the presentation of the insolvency petition to 5th April, 1928, the date of annulment. The contention of the defendant is that the plaintiff is entitled to exclude only the period from the date of the order of adjudication, namely, 21st March, 1923, to 5th April, 1928, the date of annulment. The learned District Judge has given effect to the contention of the defendant and hence this appeal is preferred by the plaintiff.

2. The question is, is this view right ? The relevant provision bearingonthe question is Section 78,Clause (2) of the Provincial Insolvency Act which runs thus:

Where an order of adjudication has been annulled under this Act, in computing the period of limitation prescribed for any suit or application for the execution of a decree (other than a suit or application in respect of which the leave of the Court was obtained under Sub-section (2) of Section 28) which might have been brought or made but for the making of an order of adjudication under this Act, the period from the date of the order of adjudication to the date of the order of annulment shall be excluded.

3. Unfettered by authority according to the plain terms of the section, the period of exclusion is that from the date of the order of adjudication to the date of the order of annulment. But it is contended that the date of the order of adjudication in Section 78,Clause (2) must be deemed to be the date of the presentation of the petition and reliance is placed on Section 28,Clause (7) of the Provincial Insolvency Act, which provides that:

An order of adjudication shall relate back to and take effect from the date of the presentation of the petition on which it is made.

4. The contention is outlined thus. Section 28, Clause (7) is a general section relating to adjudication and the consequences of adjudication and must govern the interpretation of the expression the order of adjudication wherever it occurs in the Act. This contention seems to be untenable on an examination of the principle underlying that provision and other sections of the Act, where the expression order of adjudication occurs. Section 28, Clause (7) only enunciates the well-known doctrine of relation back in insolvency law. The principle underlying that doctrine is that the adjudication has relation to the act of bankruptcy and the property vests by relation from that time in the trustee in bankruptcy, that is, the title of the trustee in bankruptcy or receiver relates to the commencement of the insolvency. This is the English rule. Under the English law, the insolvency commences either on the date of the presentation of the petition, or from the earliest act of insolvency committed within three months before the date of the presentation of the petition and ramana the title; of the trustee in bankruptcy relates to that date. It is also the law under the Presidency Towns Insolvency Act. Under Section 28, Clause (7) of the Provincial Insolvency Act, the insolvency commences from the date of the presentation of the petition. We do not think that a different rule from the English law and that laid down in the Presidency Towns Insolvency Act was intended to be laid down in regard to the legal consequences flowing from the doctrine of