The court has the power to dismiss an insolvency petition under Section 25 of the Provincial Insolvency Act before issuing notice under Section 19(2) to the creditors if it is satisfied that the debtor has committed no act of insolvency and is able to pay the debts.

( 1 ) THIS is a revision under Section 75 (1) of the Provincial Insolvency Act.

( 2 ) THE applicant filed an insolvency petition in the court of Insolvency Judge for adjudging the respondents as insolvents on the ground that the respondents did not pay a sum of Rs. 48,522/- which became due and also had committed various acts of insolvency including, making fictitious entries in their account.

( 3 ) THE petition was presented on 28-7-1986 before notice could be issued on the petition, the respondents put in appearance and opposed the application for appointment of interim receiver. The said application was rejected on 12-8-1986 by the Insolvency Judge with the consent of the parties. The respondents also deposited in court fixed deposit receipts of Rs. 50,000/- in order to show that they possessed sufficient assets and money to pay off the debt of the applicant and did not commit any act of insolvency.

( 4 ) THEREAFTER, an application was presented by the respondents, being application No. 45c for dismissing the insolvency petition and requested the court to exercise the powers under S. 25 of the Act. This application has been allowed by the court. An appeal preferred by the applicant was dismissed by the District Judge, Etah, by his judgement dated 27-10-1986.

( 5 ) AGGRIEVED by the orders of the court below the applicant has filed this revision.

( 6 ) IT is necessary to state here that the concurrent findings of the two courts below are that the respondents admitted that a sum of Rs. 48 thousand and odd is due from them to applicant. However, the case of the respondents is that certain documents executed by the respondents are with the applicant and they are ready and willing to pay the money if the said documents are returned to them. There is a dispute between the parties as to whether such documents exist. The applicants case is that no such documents exist. The matter has yet to be examined. The further finding of the courts below is that the applicants case that the respondents business was closed for some time before the presentation of the insolvency petition is incorrect. It has been found that from April, 1986 to July 1986, the respondents firm transacted the business of over Rs. 84,39,794. 32 and during the same period, the respondents paid purchase tax to the tune of Rs. 68963. 34 and Mandi Shulk in the amount of Rs. 29,782-77. The courts below have also taken note of the fact that the respondents had huge business assets and in any case the respondents case in this regard has not been disbelieved by the courts below.

( 7 ) AS far as the finding in regard to the ability of the respondents to pay off the debts, there is a positive finding of fact in favour of the respondents.

( 8 ) SRI G. P. Bhargava, learned counsel for the applicant has contended that in an insolvency petition it is not only the debt amounts claimed by the applicant that has to be taken into account but what has to be taken into account is that the insolvent had enough money to pay off his other debts also. The names of other creditors apparently were not given in the insolvency petition. Under the law it is not necessary to do so although that can be done.

( 9 ) LEARNED counsel for the applicant urged that on the presentation of the petition, notices under S. 19 (2) of the Provincial Insolvency Act has to be given to the creditors in the manner prescribed under the Rules. The manner has been prescribed by the Allahabad High Court under the Provincial Insolvency Rules. Relevant rules are Rules 4 and 5, which are quoted hereunder :- "4. Whenever publication of any notice or other matter is required by the Act to be made in an official gazette, or is required by the rules framed under the Act to be made in a local newspaper, a memorandum referring to and giving the date of such advertisement shall be filed with the record and noted in the order sheet. 5. Notice of an order fixing the date of the hearing of a petition under S. 19 (2)