TaxTMI 
TaxTMI 
2009 (1) TMI 957
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....sed on a decree obtained by the judgment creditor in the sum of Rs. 38,04,080/- in the said Summary Suit. 3. Thereafter, the judgment debtors settled the Petitioning creditors claim. The petitioning creditor has confirmed that it now has no claim against the judgment debtors. The judgment debtors filed a schedule of assets and liabilities disclosing the Canara Bank and the IDBI Bank (Erstwhile United Western Bank Ltd.) as their creditors. It appears that the claim of IDBI Bank has also been settled. 4. Canara Bank filed O.A. No. 256 of 2001 in the Debts Recovery Tribunal, Mumbai, against several parties, including the judgment debtors who were Respondent Nos. 2 and 3 therein. By a judgment dated 5-9-2005 the claim of Canara Bank was adjudicated for the sum of Rs. 69,90,782.58 together with further interest thereon at 12% per annum from the date of the filing of the O.A. till realisation. The Debts Recovery Tribunal also recognised the charge on the properties in favour of Canara Bank. 5. The present Notice of Motion has been taken out under section 21 of the Presidency Town Insolvency Act, 1909. I will for the purpose of this judgment, proceed on the basis that the N....
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....r this sub-section on the date of rejection of the application or the expiry of the period specified in the insolvency notice for its compliance, whichever is later : Provided further that no insolvency notice shall be served on a debtor residing, whether permanently or temporarily, outside India, unless the creditor obtains the leave of the Court therefor." 8. In view of the judgment of the Supreme Court and the judgment of this Court the recovery certificate issued by the D.R.T. is neither an order nor a decree within the meaning of section 9(2) of the said Act. Canara Bank therefore could not have issued an insolvency notice on the basis of the recovery certificate issued by the DRT on the judgment debtors. That however is not decisive of the present case. 9. The petitioning creditor had admittedly validly adopted the above proceedings. The present Notice of Motion has been taken out under section 21 of the said Act. The question before me is not whether Canara Bank or any other creditor was or is entitled to avail of the provisions under section 9(2) but whether they are entitled to oppose the judgment debtors application under section 21 thereof. 10. The question must....
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....cy. (2) A person having notice of the presentation of any insolvency petition by or against the debtor shall not prove for any debt or liability contracted by the debtor subsequently to the date of his so having notice. (3) Save as provided by sub-sections (1) and (2), all debts and liabilities, present or future, certain or contingent, to which the debtor is subject when he is adjudged an insolvent or to which he may become subject before his discharge by reason of any obligation incurred before the date of such adjudication, shall be deemed to be debts provable in insolvency. (4) An estimate shall be made by the official assignee of the value of any debt or liability provable as aforesaid which by reason of its being subject to any contingency or contingencies, or for any other reason, does not bear a certain value: Provided that if in his opinion the value of the debt or liability is incapable of being fairly estimated, he shall issue a certificate to that effect, and thereupon the debt or liability shall be deemed to be debt not provable in insolvency. Explanation.- For the purposes of this section "liability" includes any compensati....
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....ities are available only towards the discharge of the dues of the first judgment debtor. It is admitted that the said properties constituted security for the dues of three entities viz. i) Trimbale Ispat Pvt. Ltd. ii) Trigrania Metal and Steel Industries and iii) Trigrania Ispat Pvt. Ltd. It appears that the dues of Trigrania Ispat Pvt. Ltd. have been settled. There are however recovery certificates in respect of the other two entities. Mr. Bulchandani admitted that there is a dispute between the co-owners/members of the family as to whether the properties belong solely to debtor No. 1 or not. 15. Mr. Bulchandani invited me to consider and adjudicate upon the title of debtor No. 1 in respect of this property. It is not possible to do so in these proceedings. Apart from anything else, the concerned parties are not even before me. 16. Canara Bank would in any event be entitled to prove and claim in insolvency for the balance, if any, after realisation of its securities. There is no dispute that a secured creditor is entitled to prove its dues for the balance in insolvency. 17. In the circumstances, I do not find it appropriate at this stage to grant an order annulling the ad....