Judgment :- 1. Notwithstanding the proof of debt by virtue of the decree for Rs. 16,440 suffered by the debtor in O.S. No. 521 of 1979 on the file of the City Civil Court, Madras, as also the proof of act of insolvency by virtue of the attachment of the debtors moveables in E.P. No. 2060 of 1979 in the above suit having subsisted for more than 21 days, vide Ex.P1, certified copy of E.P. No. 2060 of 1979 and orders made thereon and Ex.P2, bailiffs report therein, I am inclined to dismiss this creditors petition to adjudicate the debtor an insolvent pursuant to the mandate enshrined in S. 13, of the Presidency Towns Insolvency Act (hereinafter referred to as the Act), because, in my opinion, the debtor has satisfied me that he is able to pay dis debts and further that the present proceeding is not with a genuine desire to have the properties of the debtor administered for the benefit of the body of creditors but with a view to coerce the debtor to pay on the threat of disgrace to him. 2. S. 13 (4) of the Act runs thus— “The Court shall dismiss the petition— (a) if it is not satisfied with the proof of facts referred to in sub-S.(2); or (b) if the debtor appears and satisfies the court that he is able to pay his debts or that he has not committed any act of insolvency or that for other sufficient cause no order ought to be made.” It is true that it is for the debtor to allege and to adduce satisfactory proof of his ability to pay and of the existence of other sufficient cause as prescribed in the above provisions to escape an adjudication order. In the instant case, he his averred in paragraphs 4 to 6 of his counter statement that as sole proprietor of Thirumuthi Constructions, he is a longstanding contractor in the approved-list of ‘A class contractors of Southern Railway, that he is executing works of about fifteen lakhs of rupees, that he is an Income-tax assessee paying about Rs. 20,000 per annum that his assets as on 31st March, 1980 are much more than his liabilities and that he has to get about Rs. 5,00,000 inclusive of the security deposit of Rs. 1,50,000. As R. W. 1, he asserted his above economic status.
20,000 per annum that his assets as on 31st March, 1980 are much more than his liabilities and that he has to get about Rs. 5,00,000 inclusive of the security deposit of Rs. 1,50,000. As R. W. 1, he asserted his above economic status. It is seen from Ex. R7, his income-tax assessment order for the assessment year 1979-1980 that toward his income-tax liability of Rs. 13,312, he had paid in advance Rs. 17,762, and becomes entitled to the refund of Rs. 4,450 and from Ex. R8, income-tax assessment order for the assessment year 1978-1979, towards his income-tax liability of Rs. 6,132, he had paid an advance of Rs. 12,351 and become entitled to the refund of Rs, 6,219. It further reveals that there is an appreciable increase in his income. The other documents, viz., Ex. R1 to R6, the communications addressed to him by the Southern Railway, do corroborate that he is a contractor of Southern Railway. Though these documents do not indicate as to the amount due by the Southern Railway to him, they establish that certain moneys are standing to his credit in the Southern Railway as security deposit and that he continues to have such Railway contracts. 3. Per contra, though in chief examination P.W. 1 stated that R.W. 1 has no means to pay, his testimony in cross-examination is that he does not know that the debtor should get large sums in the contract works. Further, admittedly pending E. P. No. 2060 of 1979, the debtor paid a sum of Rs. 1,500. All that S. 13 of the Act requires is proof of the debtors ability to pay but not the payment itself. In the above circumstances, I am satisfied that the debtor is able to pay his debts. 4. The movables attached in E P.2060 of 1979 relied on as an act of insolvency, are four iron chairs and a wooden table. If these items are substantially worth, the petitioning creditors would not allow the other creditors to share the fruits of his execution. In the circumstances, it is not difficult to perceive the oblique motive behind this proceeding. Indeed, in paragraph 7 of his counter-statement the debtor has asserted that “this action of the petitioning creditor is only to bring pressure on me to pay the above claim and paralyse my further prospects in my executing contracts with Railways”.
In the circumstances, it is not difficult to perceive the oblique motive behind this proceeding. Indeed, in paragraph 7 of his counter-statement the debtor has asserted that “this action of the petitioning creditor is only to bring pressure on me to pay the above claim and paralyse my further prospects in my executing contracts with Railways”. The above circumstance, in my opinion, is a sufficient cause within the meaning of S. 13 (4) of the Act, to reject this petition. 5. This petition, therefore, fails and is dismissed, but without costs.