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Book Description
The Law of Insolvency has gained grater importance in recent times. The growing volume of case-law on the subject shows a trend towards increase in the number of business going insolvent in today’s highly competitive environment and open market economy. In the present scenario, the author feels that more demands are going to be placed on the law of insolvency for protecting sinking businessmen, and safeguarding their lenders.
The topic wise chapters cover and lucidly explain the various aspects of the law of insolvency viz. – object of insolvency laws, acts of insolvency, who can be adjudged insolvent, constitution and powers of courts under the Act and the various provisions pertaining to the filing of petitions, proceedings in insolvency cases, the administration of property, methods of proof of debts, Antecedent Transactions, penalties for offences under the Acts, Summary administration, the appointment and removal of Official Assignee and his duties and powers, the Doctrine of Reputed Ownership. Etc.
The judiciary has made important contribution to the development of the law on the subject and a number of important decisions have touched upon such important issues such as requirements of an insolvency notice, the role of dishonour of cheques, the duty of the person who himself seeks that he should be declared an insolvent, the importance of voluntary arrangements, the doctrine of reputed ownership, etc. etc. The author has dealt with all these matters in a most succinct manner.
The author’s style is simple and lucid and makes easy reading. A Table of cases and a detailed subject-index add to the utility of the book. In the Appendices, the full text of the provincial Insolvency Act, 1920 and the Presidency Towns Insolvency Act, 1909 is given.
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Contents
Table of Cases
Table of Statutes
Objects of Insolvency Laws
• Meaning of "bankruptcy"
• Administrative or adjective law
Acts of Insolvency [S. 9, PTIA and S. 6, PIA]
• Transfer of property for benefit of creditors
• Transfer of property with intent to defeat or delay creditors
• Fraudulent preference
• Departure or seclusion
• Sale of property in execution of decree
• Decree
• Debtor's petition for insolvency
• Suspension of payments
• Dishonour of cheque as suspension of payment. .
• Surety of judgment-debtor
• Insolvency Notice [S. 9, PTIA]
• Suppression of facts by creditor
• Setting aside of insolvency notice
• Setting aside on grounds other than those mentioned in S. 9(5)
• Act of Insolvency by Agent
• Burden of proof
Who can be Adjudged Insolvent
• Non-Residents or Foreigners [S. 11, PTIA and S. 8, PIA]
• Minors
• Married Woman
• Persons of Unsound Mind
• Partners and Partnership Firms [S. 99, PTIA and S. 79(2) (c), PIA]
• Joint Debtors
• Joint Hindu Family
• Representative Debtor
• Corporations [S. 8, PIA]
Constitution and Powers of Court
• Leave of insolvency court (S. 7, PTIA)
• Appeals [S. 8, PTIA]
The Petition
• Procedure under Presidency Towns Insolvency Act [S. 10]
• Bona fides of Debtor Applicant
• Restriction on Jurisdiction [S. 11]
• Creditor's Petition [S. 9, PIA and S. 12, PTIA]
• Recovery proceedings for penalty
• Decree
Abuse of insolvency process
Limitation
Proceedings on Creditor's Petition [S. 13]
Debtor's Petition [S. 14, PTIA and S. 10, PIA]
Procedure under Provincial Act
• Contents of Petition [S. 13]
• Withdrawal [S. 14]
• Consolidation of Petitions [S. 15] . .
• Power to Change Carriage of Proceedings [S. 16]
• Death of Debtor [S. 17]
• Procedure for admission of petition [S. 18]
Procedure on Admission [S. 19]
• What Constitutes'Admission'
Interim Receiver [S. 20]
Interim Proceedings against Debtor [S. 21]
Duties of Debtor [S. 22]
Release of Debtor [S. 23]
Procedure at Hearing [S. 24]
Dismissal of Petition [S. 25]
Award of Compensation [S. 26]
Order of Adjudication [S. 27]
Effects of Order of Adjudication [S. 17, PTIA and S. 28, PIA] .
Vesting of Property
Vesting under Presidency Towns Insolvency Act [S. 17]
Vesting under Provincial Insolvency Act [S. 28]
Attachment before judgment
Bar and stay of suits and other legal proceedings [S. 17, PTIA and S. 28(2) & (6), 29, PIA]
No bar against criminal proceedings. .
• Appointment of Special Manager [S. 19, PTIA]. .
• Notice or Advertisement of Adjudication [S. 20, PTIA and S. 30, PIA]
Subsequent Proceedings
• Protection Order [S. 25, PTIA and S. 31, PIA]
• Arrest after adjudication [S. 32, PIA and S. 34, PTIA]
• Schedule of Creditors [S. 33, PIA and S. 24, PTIA]
• Debts Provable [S. 34, PIA and S. 46, PTIA]
• Statutory Penalty
• Annulment of adjudication [S. 35, PIA and S. 21, PTIA]
• Lack of bona fides in application for annulment
• Effects of annulment
• Concurrent Proceedings [S. 36, PIA and S. 22, PTIA]
• Proceedings on annulment [S. 37, PIA and S. 23, PTIA]
• Meetings of creditors [S. 26, PTIA] Public examination of insolvent [S. 27, PTIA]
• Composition and schemes of arrangement [S. 38, PIA and S. 28, PTIA]
• Order on Approval [S. 39, PIA and S. 30, PTIA]
• Readjudication as Insolvent [S. 40, PIA and S. 31, PTIA]
Control over person or property of insolvent
• Duties of insolvent in realisation and discovery of property [S. 33, PTIA]
• Arrest of insolvent [S. 34, PTIA]
• Redirection of letters [S. 35, PTIA]
• Discovery of insolvent's property [S. 36, PTIA]
• Discharge of insolvent [S. 41, PIA and S. 38, PTIA]
• Discharge of proceedings
• Cases in which absolute discharge refused [S. 42, PIA and S. 39, PTIA]
• Annulment on Failure to apply for Discharge [S. 43, PIA and S. 41, PTIA]
• Renewal of application for discharge [S. 42, PTIA]
• Duty of Discharged Insolvent [S. 43, PTIA]
• Fraudulent Settlements [S. 44, PTIA]
• Effect of order of discharge [S. 44, PIA and S. 45, PTIA]
Administration of Property
• Property divisible among creditors
• Property Exempted
• Property of Insolvent at Commencement of Insolvency [S. 28, PIA]
• After-acquired Property
• Personal Earnings
• Income
• Income from Trade or Business
Methods of proof of debts
• Future Debts [S. 45, PIA]
• Debts Provable [S. 46, PTIA]
• Liability to pay costs of litigation
• Mutual dealings and set-off [S. 46, PIA and S. 47, PTIA]
• Secured creditors [S. 47, PIA]
• Surrender of Security
• Interest [S. 48, PIA]
• Mode of proof [S. 49, PIA]
• Disallowance and reduction of entries in Schedule [S. 50, PIA]
Antecedent Transactions
• Restriction of rights of creditor under execution [S. 51, PIA and S. 53, PTIA]
• Criterion for Determining Good Faith
• Knowledge of Insolvency Proceedings on part of Buyer and Good Faith
• Emphasis should be upon Fairness of Sale
• Formalities of Setting Aside
• Avoidance of Voluntary Transfer [S. 53, PIA and S. 55, PTIA]
• Order of setting aside necessary
• Burden of proof
• Avoidance of preference in certain cases or fraudulent preference [S. 54, PIA and S. 56, PTIA]
• Conditions necessary for Avoidance of Preference
• Protection of bona fide transactions [S. 55, PIA]
• Realisation of property [S. 56, PIA and S. 58, PTIA]
• Disclaimer of onerous property [Ss. 62-67, PTIA]
• Power to appoint Official Receiver [S. 57, PIA]
• Duties and Powers of Receiver [S. 59, PIA and S. 68, PTIA]
• Power to require Information [S. 59-A, PIA]
• Sale of Agricultural Property [S. 60, PIA]
• Realisation of property under Presidency Act [S. 58]
• Duty and powers of Official Assignee in realization [S. 68, PTIA]
• Seizure of Property [S. 59]
• Appropriation of Salary [S. 60, PTIA]
• Distribution of property
• Priority of Debts [S. 61, PIA]
• Security Deposit in Court Calculation of Dividends [S. 62, PIA]
• Creditor who could not Prove before Declaration [S. 63, PIA]
• Final Dividend [S. 64, PIA] No Suit for Dividend [S. 65, PIA]
• Management by and Allowance to Insolvent [S. 66, PIA]
• Right to Surplus [S. 67, PIA]
• Committee of Inspection [S. 67-A, PIA and S. 88, PTIA]
• Appeal to court against Receiver [S. 68, PIA and S. 86, PTIA]
• Limitation
• Appeals [S. 75, PIA]
• Appeal by Insolvent
Penalties
• Punishment for offences [S. 69, PIA and S. 103, PTIA]
• Disqualifications of insolvent [S. 73, PIA and S. 103-A, PTIA]
Summary Administration
• Small Insolvencies [S. 74, PIA and S. 106, PTIA]
• Review [S. 75, PIA]
Official Assignee
• Appointment and removal [S. 77, PTIA]
• Duties as regards insolvent's conduct [S. 79, PTIA]
• Misfeasance [S. 82]
• Control over discretionary powers [S. 85, PTIA]
• Remuneration
• Control of court [S. 87, PTIA]
Doctrine of Reputed Ownership
• Hypothecation and reputed ownership
• Real owner becomes creditor for value of his property
• Benami Transactions
Appendix I
Appendix II
Subject Index
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Author Details
Dr. Avtar Singh, B.Com., LL.M., LL.D (Luck), Vidya Bhusan (Hindi Sansthan, U.P.) Ex-visiting Professor of Business Laws, I.I.M., Lucknow, Ex-Reader in Law, Lucknow University.
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