Akella Ramasomayyagulu and Others vs The Official Receiver, Godavari Rajahmundry

The appellants are the sons of the insolvent. They applied to the lower Court for stay of sale advertised to be held on 29th August 1924 by the

Official Receiver of Godavari on the ground that they were divided from the insolvent and that their shares should not be sold. The learned Judge

has not considered the question whether the shares of the appellants are liable to satisfy the debts of the insolvent. He has allowed the Official

Receiver to sell the insolvent''s interest in the property leaving it to future litigation to determine the rights of the parties. We consider in a case like

this it is not proper that the insolvent''s property should be sold when there is a cloud on the title which could be removed by a proper proceeding

u/s 4 of the Provincial Insolvency Act. We, therefore, set aside the order and direct the District Judge to restore the application to file and treat it

as an application u/s 4 of the Act and dispose of it according to law. The Official Receiver has the power under the Act to sell the shares of the

sons of the insolvent and it would be for the son''s to make out that their shares are not bound to liquidate the debt contracted by their father.

Costs of this appeal will abide the result.