Full Judgment
1. This appeal is directed against an order by which an application under the Provincial Insolvency Act has been dismissed. The learned District Judge has refused the application on two grounds, namely, first, that the petitioner is not shown to have ordinarily resided or carried on business within the jurisdiction of the Court as required by Section 6, Sub-section (2) of the Provincial Insolvency Act; and secondly, that he has committed acts of bad faith. In our opinion, neither of these grounds can be sustained, and the order of the Court below must be set aside.
2. In so far as the tint ground, upon which the learned District Judge has based his decision, is concerned, it is clear upon the evidence that although the petitioner originally resided at Delhi, towards the end of 1905, he came to the suburbs of Calcutta; he established a factory there, resided up to 1908, and carried on business which was closed on account of financial difficulties about that time. He admits that during this period he had to go to Delhi occasionally to look after suits instituted against him in the Delhi Court. It has been strenuously contended by the learned Counsel for the respondent creditor that under the circumstances, the petitioner cannot be taken to have ordinarily resided within the jurisdiction of the Court of the District Judge of the 24-Pergannahs.
3. In our opinion, there is no force in this contention. It is not necessary for the petitioner to have resided for a long time at a place within the jurisdiction of the Court; and it was held, in the case of Ex parte Hecquard (1889) 24 Q.B.D. 71 : 38 W.R. 148 : 6 Morrell 282, that even temporary residence for a time and for a particular purpose is enough to give the Court jurisdiction to deal with an application under the Bankruptcy Act: Kumud Nath v. Jatindra Nath 13 C.L.J. 221 : 15 C.W.N. 399 : 38 C. 394 : 9 Ind. Cas. 189. It has been suggested, however, that the petitioner has taken up his residence in the suburbs of Calcutta with a view to avoid the jurisdiction of the Delhi Court. But the evidence does not justify any such inference; nor is there any apprehension that the creditors at Delhi would be placed in a position of embarrassment by reason of the proceedings in the Court of the District Judge of the 24-Pergannahs, because if there is any portion of the investigation which may be more conveniently carried on in the Delhi Court rather than in the Court of the District Judge of the 24-Pergannahs, it would be quite competent, to the District Judge to make an order under Section 50 of the Act as pointed out in the case of Lalji Sahay v. Abdul Gani 32 C.L.J. 452 : 7 Ind. Cas. 765 : 15 C.W.N. 253. It follows, therefore, that the first ground on which the judgment of the learned Judge is based cannot be supported.
4. In so far as the second ground is concerned, it is clear that the learned District Judge has overlooked that the procedure laid down in the Provincial Insolvency Act of 1907 is materially different from that laid down in the Code of 1832. It is sufficient to refer to the cases of Udai Chand Maity v. Ram Kumar 12 C.L.J. 400 : 15 C.W.N. 213 : 7 Ind. Cas. 394 and Samiruddin v. Kadar Moyee 12 C.L.J. 445 : 15 C.W.N. 244 : 7 Ind. Cas. 691. The second ground also, therefore, must prevail. It has not been disputed before us that the amount of the debt of the petitioner exceeds Rs. 500. Consequently, he has fulfilled the requirements of Section 6 of the Provincial Insolvency Act.
5. The result, therefore, is that this appeal is allowed, the order of the Court below set aside and the order of adjudication made. The record will be sent down to the Court below in order that a Receiver may be appointed and proceedings taken in accordance with the Act. It will be open to the District Judge to continue the Receiver who was temporarily appointed during the pendency of the appeal. We shall make no order as to costs.