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1927 Supreme(Lah) 84

Lahore High Court
Zafar Ali, J.
Munshi Ram - Appellant
Versus
Sheikh Ghulam Dastgir, Official Receiver & Ors. - Respondents
Decided On : 09-12-1927

JUDGMENT

Zafar Ali, J. - One Amar Singh of Jullundur City authorized three gentlemen of that City to sell his property for the purpose of paying off his debts. These gentlemen who are described as trustees sold by auction a house of Amar Singh to Munshi Ram, appellant, for Rs. 5,200. A deed of sale was now to be executed by the trustees and registered. Munshi Ram deposited Rs. 5,200 with Lala Dwarka Das, Treasurer, to be paid to the trustees before the Sub-Registrar but no deed was executed because the trustees refused to enter therein an indemnity clause.

2. Long after that Amar Singh was adjudged an insolvent and the Official Receiver applied to the District Judge for orders about the money that was in the hands of Lala Dwarka Das. The District Judge endorsed the following order on that application:

All moneys in hand should be made over to the Official Receiver. 25th February 1927.

3. On 4th March 1927, Munshi Ram presented a petition to the District Judge stating that the money was his, and praying that it may not be handed over to the Official Receiver. But the District Judge ordered Lala Dwarka Das, who was with the petitioner at that time, to pay the money to the Official Receiver. This order is in vernacular and runs thus:

Munshi Ram wants to get back the money. For the reasons recorded in the order in English the money be made over to the Official Receiver.

4. The order in English referred to above was presumably the order of 25th February 1927, which, however, contains no reasons whatsoever.

5. Now it is clear that it was highly unsatisfactory to dispose of in this summary manner, without any enquiry a matter involving a question of title to a sum of Rs. 5,200. Before making any order the District Judge should have decided whether the money belonged to Munshi Ram or to the insolvent.

6. Counsel for the Official Receiver objects that the order of the District Judge is not appealable and that even if it is the appeal must fail because the creditors of the insolvent have not been made respondents. Both these contentions are untenable. The order of the District Judge disposes of a question of title and hence falls under Section 4, Provincial Insolvency Act of 1920 and is appealable under Clause (2) of Section 75 of that Act. The creditors are not; necessary parties to this appeal as held in East India Cigarette Manufacturing Co, Ltd. v. Ananda Mohan Basak 24 C.W.N. 401. I accept the appeal, set aside the order of the learned District Judge and direct that the application of the appellant be disposed of in accordance with law after a proper enquiry.

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