JUDGMENT

Page, C J - In this reference the question propounded is:

When an insolvency has been annulled under the provisions of Section 43, Provincial Insolvency Act, and the receiver has, before the order of annulment, applied to the Court to have a transfer of property set aside under the provisions of Section 53 or Section 54 of the Act, has the Court jurisdiction after the order of annulment of the insolvency proceedings to continue the proceedings under Section 53 or Section 54 of the Act?

2. On 22nd June 1927 an order of adjudication was made against the debtor, It was further ordered that the insolvent must apply for his discharge on or before 22nd June 1928. Further time was granted until 21st January 1930, for the presentation of the application for discharge, but no application in that behalf was made by the insolvent within the period fixed by the Court and on 11th February 1930, on the application of the insolvent the Court annulled the adjudication under Section 43 of the Act, and under Section 37 directed "that the property of the insolvency be vested in the Official Receiver as from the date of annulment of the order of adjudication."

3. The effect of the order as the Court did not impose any conditions on the annulment of the insolvency was that the property was vested in the receiver unconditionally. Now, on 13th January 1929, during the subsistence of the insolvency, the receiver had applied under Section 53 and Section 54 of the Act that a certain transfer of property by the insolvent should be declared void as against the receiver in insolvency, but no order had been passed on the application of 11th February 1930, when the adjudication was annulled under Section 43. Notwithstanding the order of annulment however the learned District Judge of Mandalay proceeded to hear the application of the receiver, and on 12th February 1932, passed an order declaring the transfer void as against the receiver under Section 54 of the Act. The question that falls for determination in this reference is whether the District Court of Mandalay had jurisdiction to pass the order annulling this transfer by the debtor. Section 43(1), Prov. Insol. Act, is to the following effect;

If the debtor does not appear on the day fixed for hearing his application for discharge or on such subsequent day as the Court may direct, or if the debtor does not apply for an order of discharge within the period specified by the Court, the order of adjudication should be annulled, and the provisions of S. S7 shall apply accordingly.

4. Under Section 37(1):

Where an adjudication is annulled, all sales and disposition of property and payments duly made, and all acts theretofore done, by the Court or receiver shall be valid, but, subject as aforesaid, the property of the debtor who was adjudged insolvent shall vest in such person as the Court may appoint or in default of any such appointment, shall revert to the debtor to the extent of his right or interest therein on such conditions (if any) as the Court may, by order in writing, declare.

5. Now the language in which Sections 43 and 37 of the Act are couched is neither clear nor free from difficulty and different views have been expressed by the various High Courts in India as to the conditions which the Court may impose when it vests the property of the debtor in an appointee under Section 37. That some limit must be placed upon the power of the Court to impose conditions under Section 37, is I think manifest. For instance, I think that the Court after passing an order annulling the insolvency would not be entitled to order that the property should be vested in an appointee who should continue the liquidation of the debtor's assets on the same terms and conditions as those on which the receiver in insolvency would have been entitled to carry out the liquidation if the insolvency had still been subsisting. Nor I think would it be competent for the Court after an order of annulment had been passed to direct that