1944 Present: HOWARD C.J. and de Kretser J.

GANY, Applicant, and HAY, Respondent.

23-D.C., Kandy, 170.

Insolvency-certificate of conformity-Application to revise order allowing  certificate - delay on part of creditor-Withholding of facts-Insolvency Ordinance (Cap.88) ss. 133 and 137.

An application by a creditor under section 133 of the Insolvency Ordinance to revise an order allowing a certificate to an insolvent may be refused where the application has been unduly delayed and where the applicant has been guilty of a conspiracy of silence regarding facts within his knowledge.

Semble where an insolvent opposes a claim made against him, the certificate granted to him would be of no avail to him upon proof of the facts stated in section 127.

APPEAL from an order of the District Judge of Kandy.

H.V. Perera, K.C. (with him A. Seyed Ahamed), for the proved creditor, appellant.

No appearance for the insolvent, respondent.

Cur. adv. vult.

October 25, 1944. DE KRETSER J.-

After the insolvent had been granted a certificate of the third class on May 15, 1942, and after his assets had been distributed, the appellant, who was one of the earliest creditors to prove a claim and had actively interested himself in attempts at composition of the debts, moved the Court under section 133 alleging that the insolvent had not disclosed property worth Rs. 25,000 which he had inherited from his father. On the insolvent filling a counter-affidavit disclosing the fact that he had transferred this property to his sister in January 1939, i.e., 16 months before the adjudication, the petitioner filed an amended petition praying for action under either section 127 or section 133, alleging that a contemporaneous agreement existed on which the insolvent had certain rights.

Even now his affidavit was not at all what it should have been and many important facts were not disclosed or accounted for. He actually stated that because the insolvent induced him to refrain from opposing the certificate by promising to abide by the "deed of composition" (which provided for the appellant being paid in FULL) he has therefore "not in a position to bring to the notice of the Court the facts referred to in paragraphs 9 and 10". He was thus admittedly a party to a fraud practiced by the insolvent and deliberately refrained from availing himself of the remedy then open. But he made no move even after the composition had been refused and a fresh certificate meeting ordered and he delayed a year therefrom. The affidavit is silent as to the amount due at its date and the reason for the delay in taking action. None of the many creditors took steps to be associated with the move made by the appellant. If the insolvent had assets they vested in the assignee who could receive them for the benefit of all the creditors. The appellant by proving his claim had elected to take relief in the insolvency case.

What then could be gained by this move? He could exert pressure on the insolvent and so get undue preference or he might commit him to jail perhaps.

The learned Judge in the Court below stated in his order that the application under section 127 was not pressed, but the petition of appeal says it was not abandoned, and Counsel has devoted most of his attention to this application. The Judge refused the application under section 133 on the ground that it was contrary to public policy to allow the appellant, who had known all the facts and refrained from disclosing them for his own benefit, to re-open proceedings.

It is necessary to consider both sections 127 and 133. No case decided under section 127 was found by the Judge or has been brought to our notice not have I been able to discover one. As a matter of first impression it strikes me that no provision is made in section 127 to move the

Court to have the certificate declared void. An order allowing a certificate is final and conclusive until revised under