Provable debts in insolvency can defeat annulment, and secured creditors may oppose relief even without section 9(2) notice rights.

Under the Presidency Town Insolvency Act, 1909, the class of creditors entitled to prove in insolvency is broader than the class entitled to serve an insolvency notice. A creditor who could not have invoked section 9(2) may still oppose annulment under section 21 if adjudication has been validly made and provable debts remain unpaid. Secured creditors may prove for any balance left after realisation of security, and their claims can prevent annulment unless the insolvent shows that all provable debts have been paid in full. On these principles, annulment failed because full payment was not established and the secured creditor could resist the application.

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Issues: (i) Whether a creditor who may not be entitled to serve an insolvency notice under section 9(2) of the Presidency Town Insolvency Act, 1909 can nevertheless oppose an application under section 21 for annulment of adjudication; (ii) Whether the debts due to a secured creditor are provable in insolvency and prevent annulment on the ground that the insolvent's debts have not been paid in full.

Issue (i): Whether a creditor who may not be entitled to serve an insolvency notice under section 9(2) of the Presidency Town Insolvency Act, 1909 can nevertheless oppose an application under section 21 for annulment of adjudication.

Analysis: Section 21 permits annulment only where the Court is satisfied that the debtor ought not to have been adjudged insolvent or that the debts of the insolvent are paid in full. The right to oppose such an application is not confined to creditors who could have invoked section 9(2). Once adjudication has been validly made, any creditor entitled to prove in insolvency may resist annulment if the debts remain unpaid.

Conclusion: A creditor is not disqualified from opposing an application under section 21 merely because it could not have served an insolvency notice under section 9(2).

Issue (ii): Whether the debts due to a secured creditor are provable in insolvency and prevent annulment on the ground that the insolvent's debts have not been paid in full.

Analysis: Section 46 makes all debts and liabilities falling within its scope provable in insolvency, and this is not limited to debts of creditors who were entitled to initiate insolvency proceedings under section 9(2). The definition of debt includes a judgment debt, and a secured creditor may prove for the balance remaining after realisation of security. As the dues of the bank had not been finally satisfied and the securities and liabilities remained disputed, it could not be said that the insolvents' debts were paid in full.

Conclusion: The secured creditor's claim was provable in insolvency to the extent of any balance, and the requirement of payment in full was not satisfied.

Final Conclusion: The application for annulment failed because the insolvents had not established full payment of debts, and the secured creditor was entitled to oppose the request and prove its balance claim in insolvency.

Ratio Decidendi: Under the Presidency Town Insolvency Act, 1909, the class of creditors entitled to prove in insolvency is broader than the class entitled to serve an insolvency notice, and an adjudication will not be annulled under section 21 unless the insolvent shows that all provable debts have been paid in full.

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