Proof of debt scrutiny permits limited inquiry and evidence on oath, but only in a summary, businesslike manner.

The Official Assignee under the Presidency-towns Insolvency Act, 1909 may scrutinise a proof of debt by calling for vouchers, examining the grounds of the claim, requiring further evidence, and, where necessary, receiving evidence on oath. The scheme distinguishes this function from the Insolvency Court and permits a limited inquiry to ensure that only genuine debts are admitted and that collusive or untenable claims do not reduce the estate available for distribution. That inquiry must remain summary and businesslike, and should not be expanded into a full trial with unnecessary cross-examination or prolonged hearings.

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Issues: Whether the Official Assignee, while examining proof of debt under the Presidency-towns Insolvency Act, 1909, had power to hold a proper inquiry and receive evidence on oath for deciding whether the debt should be admitted or rejected.

Analysis: The statutory scheme distinguishes the Insolvency Court from the Official Assignee and entrusts the latter with scrutinising proofs of debt under the Second Schedule. The relevant provisions empower him to call for vouchers, examine the proof and grounds of debt, require further evidence, and administer oaths for insolvency proceedings. The object is to ensure that only genuine debts are admitted and that collusive or untenable claims do not diminish the estate available for distribution. The practice of summary disposal does not exclude a limited inquiry where necessary, though the procedure should remain practical and not be converted into a full trial with unnecessary cross-examination and prolonged hearings.

Conclusion: The Official Assignee is entitled to investigate the proof of debt and, where necessary, receive evidence on oath for that purpose, but should conduct the inquiry in a summary and businesslike manner.

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