YENUMULA MALLU DORA versus PERURI SEETHARATNAM AND OTHERS

YENUMULA MALLU DORA versus PERURI SEETHARATNAM AND OTHERS

An act of insolvency once committed is not purged by subsequent payment to some creditors; it remains available to all creditors unless all are satisfied. Section 25 cannot be invoked to dismiss a creditor's petition when the debtor continues to be heavily indebted and unable to pay debts.

Parties
Appellant: Yenumula Mallu Dora; Respondents: Peruri Seetharatnam and others
Jurisdiction
India
Judgment Date
14 October 1965
Procedural Posture
Civil Appeal / Appeal by Special Leave From the Judgment and Order Dated March 14, 1963 of the Andhra Pradesh High Court in C.r.p. No. 1725 of 1959
Outcome
Appeal dismissed
Legal Topics
Provincial Insolvency Act S.6(e), Act of Insolvency, Section 25 Sufficient Cause, Receiving Order, Inability to Pay Debts
Insolvency Law Provincial Insolvency Act S.6(e) Act of Insolvency Section 25 Sufficient Cause Receiving Order Inability to Pay Debts

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Parties

Yenumula Mallu Dora

Appellant

Peruri Seetharatnam and others

Respondents

Procedural Posture

Civil Appeal / Appeal by Special Leave From the Judgment and Order Dated March 14, 1963 of the Andhra Pradesh High Court in C.r.p. No. 1725 of 1959

Legal Issues

  1. 1 Whether an act of insolvency once committed can be purged by satisfying only some creditors
  2. 2 Whether section 25 of the Provincial Insolvency Act allows dismissal of the application when some debts are satisfied

Ratio Decidendi

An act of insolvency once committed is not purged by subsequent payment to some creditors; it remains available to all creditors unless all are satisfied. Section 25 cannot be invoked to dismiss a creditor's petition when the debtor continues to be heavily indebted and unable to pay debts.

Court Disposition

Appeal dismissed

Orders

  • Adjudication of the appellant as insolvent and the receiving order against him were properly made
  • No order as to costs