Arbuthnot and Co. In sovent Debtors vs A. Sabapathy Mudaliar

A preliminary objection has been raised that the appeal is out of time as the order was made on the 8th April 1909 and the appeal was not filed

within one calendar month as required by Section 73 of the Indian Insolvency Act, 1848. The vacation in that year began at the end of April and

the appeal was filed on the re-opening day of July. As regards this point we are not prepared to differ from Aruvamudu Ayyangar v. Samiappa

ILR (1897) M. 385 Sambasiva Achari v. Ramaswami Reddi ILR (1898) M. 179 and Hajee Ismail Sail v. The Trustees of the Harbour, Madras

ILR (1900) M. 389 a series of rulings which appear to have been generally accepted and acted on for a period of some years.

We therefore hold the appeal is in time.

The appeal relates to the sum of Rs. 1000 which the petitioner as Head Godown keeper was required to deposit with Messrs. Arbuthnot and

Co., as security on his appointment as Head Godown keeper and which he paid in on 18th April 1906. In his affidavit he merely states that it was

taken from him as security for the performance of his duties it being understood it should be returned to him when he left the service. The Official

Assignee reports that it was placed by the firm in fixed deposits in the name ''Ourselves account of security for A. Sabapathy Mudali as godown

keeper."" The Official Assignee adds that the usual procedure of the firm was so to deposit security money at 5 per cent and the interest would, we

think, in due course have been paid to Sabapathy or credited to his security account if the insolvency had not supervened before interest was

payable.

The Official Assignee suggests the petitioner must have been aware of the manner in which his security money was dealt with, but the learned

commissioner observes that there is no evidence that this was ever communicated to him and has allowed the claim. With great respect we think

the principle laid down in Official Assignee of Madras v. Smith ILR (1908) M. 68 is applicable and that the relation of debtor and creditor should

be deemed to have come into existence between the bank and the petitioner in respect to this payment unless good reason is shown to the

contrary. We think no such reason has besn shown and that the proper inference is that the money was dealt with in the way according to the usual

practice and with the petitioner''s assent. We think he would have far preferred the investment of the money in what was then unfortunately a

favourite security to the same left idle. With great respect we are constrained to differ from the learned commissioner and must allow this appeal

and dismiss the petition with costs.