Full Judgment
1. Two ladies Saram Bi and Rokhia Bi wanted to prove their claim in the insolvency proceedings of one Enayatulla, the son of Saram Bi and brother of Rokhia Bi. It appears that the father of Rokhia Bai and Enayatulla had money owing by a certain firm and two ladies, the claimants, executed a power-of-attorney on the 14th November 1905 in favour of Enayatulla to manage all their affairs and all their properties to their best advantage and for the purpose of recovering moneys due to them.' Enayatulla received moneys from time to time on behalf of these ladies from the firm which was indebted to his father, and the last instalment received on account of interest was on the 12th October 1907. Then on 5th November 1908 while the ladies were going to Mecca on pilgrimage, they executed a second power-of-attorney in favour of Enayatulla. There also they authorized Enayatulla to manage all their affairs and all their properties to the best advantage, to sell or mortgage moveable and immoveable properties and to sign any deed or necessary papers on their behalf.' Enayatulla was adjudicated insolvent on 27th October 1910 but on 24th October 1910, i.e., three days before the adjudication, he executed in favour of his mother and sister a release of his rights in certain immoveable properties in satisfaction of the money which he had collected on their behalf and which he had not paid to them.
2. Under Section 56 of the Presidency Towns Insolvency Act that release was void as against the Official Assignee. The two ladies put in their claims before the Official Assignee and the learned Judge has disallowed the claims as barred. He is of opinion that the agency of Enayatulla terminated when he collected the money due to the ladies. Both the powers-of-attorney, however, are in general terms, giving general power to Enayatulla to manage all the affairs of these ladies and it is difficult to see why the first power-of-attorney, Exhibit A, should be construed to be limited to the collection of debts. That being so, it is quite clear that the agency of Enayatulla did not terminate when the debts due to the claimants were collected.
3. It is argued by Mr. Barton on behalf of the Official Assignee that unless the first power-of-attorney was limited to the collection of debts, there is no good reason why the second power-of-attorney should have been executed. But whatever might have been the motive in executing the second power-of-attorney, the first power-of-attorney constituted Enayatulla attorney to manage all the affairs generally of the ladies. It is also argued by Mr. Barton that Enayatulla refused to pay the money which he had collected to his mother and sister. But his evidence only shows that he did not pay. It is because he had not paid the money that he executed the release in 1910. If a debtor says that he does not find it convenient or is unable to pay his debts, that does not amount to refusal to pay. The agency of Enayatulla, so far as the property in the suit is concerned, terminated when he executed the release. But the release was found to have no effect in law by an order dated 29th September 1912 and on that date the consideration for the release must be taken to have failed. In a cafe like this the Article applicable is Article 97 of the Limitation Act, which says 'For money paid upon an existing consideration which afterwards fails', the period of limitation being three years from the date of the failure. That this is the proper Article applicable to cases of this nature is bone out by the decision of the Judicial Committee in Bassu Kuar v. Dhum Singh 11 A.S 47: 6 Ind. Dec. 48. Applying that Article, the claim of the claimants is within time. The judgment of the learned Judge will be set aside and the matter must be decided upon the merits. Costs will follow the result.