Vol. 15 · pages 56–60

39PARLIAMENTARY DEBATES Shri M. S. Aney (Deccan and Madras States Group): May I know, whether, in view of the wording of the particular clause, just read out it if necessary that a motion for continuation should be made ? The rule permits the Government to continue the Bill and take it through further stages if it wants to do so. Is a separate motion for its continuation therefore necessary at all ? The Honourable Dr. B. R. Ambedkar: If the motion for continuation is not made the Bill lapses. That means all the stages will have to be begun again. Mr. Naziruddin Ahmad (West Bengal: Muslim) : Sir, on this point of order the section which you were pleased to read says that a Bill which was pending in the Legislative Assembly ‘may be continued’. It is thus discretionary on the part of this House to continue or not to continue it. Therefore, a decision of the House is necessary. Mr. Speaker : That is exactly why the motion is brought. The question is : “That the Bill further to amend the Provincial Insolvency Act, 1920, be continued.” The motion was adopted. *The Honourable Dr. B. R. Ambedkar (Minister for Law): Mr. Speaker, Sir I move: “That the Bill further to amend the Provincial Insolvency Act, 1920, be referred to a Select Committee consisting of Shri Alladi Krishnaswami Ayyar; Dr. Bakshi Tek Chand, Shrimati G. Durgabai, Dr. P. S. Deshmukh, Shri M. Ananthasayanam Ayyangar, Pandit Thakur Das Bhargava, Mr. Naziruddin Ahmad, Shri Ram Sahai and the Mover, with instructions to report on or before the 16th March, 1948, and that the number of members whose presence shall be necessary to constitute a meeting of the Committee shall be five.” Sir, in order to put the House in possession of the facts which have made it necessary for Government to introduce this measure I should like to make some preliminary * C.A. (Leg.) D., Vol. II, 25th February 1948, pp. 1220-21

40 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES observations with regard to certain decisions which have necessitated the making of this provision. I think it would be enough if I began from 1924 when a case went up to the Privy Council which is known as Sat Narain versus Behari Lal. The facts of the case briefly were that a Hindu father had been adjudged insolvent. Now under section 17 of the Presidency Towns Insolvency Act the property of the insolvent becomes vested in the official Assignee from the date of the adjudication. The property of the Hindu father consists of two things : (i) his share in the joint family property, and (ii) his power to dispose of his sons property in the joint family for his personal debts provided that the debts were not incurred for an immoral purpose. The question that arose in that case before the Privy Council was whether the power of the father to dispose of property of the son is property within the meaning of section 2(e) of the Presidency Towns Insolvency Act. On that issue the Privy Council gave its decision to the effect that the power of the Hindu father to dispose of the property of his son in the joint family was not ‘property’ within the meaning of section 2(e) on the ground that section 2(e) contemplated that power which was absolute over property and power which was not absolute was not property. According to the Privy Council the power of the father to dispose of the sons’ property was not absolute because it was subject to the condition that the debts for which the property could be disposed of must not be immoral. On that ground they did not agree that the Official Assignee could become automatically vested under section 17 with the property belonging to the son. In that particular care that decision of the Privy Council did not matter very much to the creditors, for the simple reason that the Presidency Towns Insolvency Act contains a separate section—section 52—which permits the Official Assignee and the creditors to pursue such property or such capacity to obtain the property of another person. Therefore although in that particular case the property did not automatically vest in the Official Assignee, yet the Official Assignee was free to pursue the property of the son which was liable under the rule of pious obligation to pay the debts of the father by separate proceedings; and I believe he did that.

41PARLIAMENTARY DEBATES Now what happened was this. After that decision of the Privy Council the courts in India had occasions to interpret another Act which is called the Provincial Insolvency Act. As lawyer members of this House will remember, we have two separate statues dealing with insolvency,—one which deals with insolvency taking place within the towns, and the other with those in the mofussil. The Provincial Insolvency Act does not unfortunately contain a provision such as section 52 which finds a place in the Presidency Towns Insolvency Act. Consequently when a similar question arose before the courts, namely, whether the property which a Hindu father could claim under his right or power to sell his son’s interest for the payment of his own debts could be interpreted as property and become vested in the Official Assignee, only that was property within the meaning of section 2( e). Unfortunately what has happened is that different courts have interpreted this section 2(e) of the Provincial Insolvency Act in different ways. It would be interesting to note that the Bombay High Court has held that though the property does not vest power is not property and therefore, it does vest; the Patna High Court also follows the Bombay High Court and so does the Allahabad and Nagpur High Courts. On the other hand when you come to Madras, one Bench of the Madras High Court has held that the property vests, while another Bench has held that it does not vest. And the same is the case in Calcutta where one Bench has held that the property does vest and another Bench has held that it does not vest. Now I think this matter should be put right. The Madras High Court in one of its decisions clearly gave an indication to the Government of India that it was high time that legislation was brought in to set aside this discrepancy in the decisions of the different High Courts. Unfortunately during the war such a piece of legislation could not be brought in because there was not enough time. Therefore, it is to set right this discrepancy and division of opinion in the different High Courts that this measure has been brought in. All that this measure does is to reproduce bodily section 52 from the Presidency Towns Insolvency Act and makes it a part of the Provinvcial Towns Insolvency Act as section 50-A. There is nothing more that the Bill seeks to do.

42 DR. BABASAHEB AMBEDKAR : WRITINGS AND SPEECHES As the House is aware, there is also a measure for a similar purpose standing in the name of Shrimati Durgabai. Her measure differs from the Government measure in two particular respects. She wants to give retrospective effect to the measure; the Government Bill does not propose to do so. The other provision contained in the Bill of Shrimati Durgabai is that the law not only should declare that the power which the Hindu father has over the son’s interest in joint family property should be made clear as being available for distribution among the creditors, but that the power of disposal of the Manager also should be clearly stated. On that point all that I should like to say is this that I have not an empty mind but I have an open mind; and I am prepared to leave this matter to be decided by the Select Committee. Indeed one of the purposes or motives which have led me to move for reference to Select Committee was to enable the Select Committee to discuss these matters. I do not think there is anything more I need say in elucidation of the provisions of this Bill. Sir, I move. Mr. Speaker : Motion moved. *Prof. N. G. Ranga : There is the question of the manager. My Honourable friend wants this power to be extended to the Manager also. Evidently she has in mind some of the big zamindars who get their properties managed by managers. The Honourable Dr. B. R. Ambedkar: They are called ‘Karta’. Prof. N. G. Ranga: It is bad enough to vest the power in the father but it is worse to vest it in the agent also. The Honouraable Dr. B. R. Ambedkar: No, no. It is wrong. Prof. N. G. Ranga: That is the answer given by lawyers. I am looking at it from the point of view of the debtors. They have as much right to be protected as the creditors. Creditors * C.A. (Leg.) D., Vol. II, 25th February 1948, p. 1224.

43PARLIAMENTARY DEBATES are rich enough to engage these lawyers and get things done in their own way. I wish to suggest that the benefit of this Act should not be extended at all to these managers and it should not be given retrospective effect. This amendment may be passed but we should take care to see that the Law Minister comes forward at an early date with a suitable amendment in order to protect the interests of the sons also as against the vagaries of their own fathers. * Shri Biswanath Das : I have nothing to say about this particular Bill. In fact I have clearly stated that if the House comes to the conclusion that the Insolvency Act as it should stand then this Bill is a natural corollary to it. There is no denying that fact. Therefore, I have nothing more to say in the matter. The Honourable Dr. B. R. Amebkar: Mr. Speaker, Sir, I will begin with my answer to the point made by my friend who spoke last. If I understood him correctly his points were two. One was that this was purely a provincial matter and ought therefore, to be left to the Provincial Legislatures. Shri Biswanath Das : May I interrupt ‘my honourable Friend, Sir ? I stated clearly that it is in the Concurrent List and that as such the Central Government should have left it to the Provincial Government and the Provincial Legislatures. I know it is in the Concurrent List.” The Honourable Dr. B. R. Ambedkar: I was just going to say that. The reason why it was put in the Concurrent list is undoubtedly—and I do not think there can be any other reason—that in a matter of this sort there ought to be uniformity if the Centre decided there should be uniformity. Therefore it is the right of the Central Legislature to legislate on the subject. With regard to the question whether there should be an Insolvency Act or not I do not think that that can be point at issue on a matter of this sort. If my honourable Friend wants that there should be no insolvency legislation at all * C.A. (Leg.) D., Vol. II, 25th February 1948, p. 1227-28.