-1- IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL NO. 655 OF 2004 IN INSOLVENCY PETITION NO. 40 OF 2004 Hemant Damodardas of Mumbai ) Indian Inhabitant, residing at 1803 Rajul “A”. ) J. Mehta Road, Mumbai-400 006 )..Appellant versus 1. Ashok Thapar, an adult, Indian Inhabitant ) residing and carrying on business in the name and ) style of Maharashtra Savings, as the sole Proprietor ) thereof, at Thapar House, A-3, Pamposh Enclave, ) New Delhi-110048 ) 2. Thapar Buildrs Pvt. Ltd., a body corporate, ) incorporated and registered under the provisions of ) the Companies Act, 1956, having its registered office ) at Thapar House, A-3, Pamposh Enclave, ) New Delhi-110 048. ) 3. Maharashtra Group Housing Finance Co. Ltd., ) a body corporate incorporated and registered under ) the provisions of the Companies Act, 1956, having its ) registered office at Thapar House, A-3, Pamposh Enclave, ) New Delhi-110 048. )..Respondents Mr. Rohit A. Kapadia, Senior Advocate, with Mr. R.I. Chagla and Mr. Y.R. Kapadia, instructed by Haresh Mehta & Company, for the appellant. Mr. B. K. Bali with Mr. A.K. Bagla, instructed by Bagla Dandekar & Company, for the respondents. -2- CORAM: P.B. MAJMUDAR & R.C. CHAVAN, JJ. DATE: NOVEMBER 17, 2009. P.C. This appeal is directed against the order passed by the learned single Judge dated August 03, 2004, by which the learned single Judge made the petition absolute in terms of prayer clauses (a) and (b). The learned single Judge has observed that the averments in the petition remained uncontroverted as the judgment debtor was absent, though served. 2. The appellant is a judgment debtor in view of the decree passed in Summary Suit No. 1708 of 1992, 1709 of 1992 and 3754 of 1992. A notice under Section 9 (2) of the Presidency Towns Insolvency Act, 1909 was served upon the debtor. The motion for setting aside the said notice was dismissed by the learned single Judge against which an appeal was preferred and the same was also dismissed. Subsequently, by the aforesaid order, the insolvency petition was made absolute against which the present appeal is filed. 3. Mr. Kapadia, learned senior counsel appearing on behalf of the appellant, submitted that at the time of admission of the appeal, an affidavit has been filed by the appellant to the effect that the appellant had signed vakalatnama about the insolvency petition in favour of M/s. Bilawala and Company and gave necessary instructions to oppose the said petition. It seems -3- that the same was not filed on record. Learned counsel for the appellant submitted that subsequently, after filing of the present appeal, another appeal was filed by the brother of the appellant, against whom also similar order was passed declaring him as an insolvent, being Appeal No. 311 of 2005. It appears that while admitting the said appeal, this Court has passed an order that the said appeal be heard along with the present appeal. However, it seems that the respondents herein, who are the petitioning creditors, settled their disputes against the brother of the present appellant and consent terms were accordingly recorded. Relying on the said consent terms, learned counsel for the appellant has submitted that the entire dues against the firm and its partners can be said to have been recovered by the respondents, petitioning creditors, and, therefore, the present insolvency petition is required to be terminated on that line. Mr. Kapadia has submitted that the flat of one of the partners of the firm i.e. brother of the appellant herein, was taken by way of security by the respondents and the same is handed over to his brother in view of the settlement. It is submitted that the entire dues of the firm can be said to have been satisfied and in that view of the matter, now nothing survives in the present proceedings and the order of the learned single Judge may be set aside in view of the subsequent developments. 4. Mr. Bali, learned counsel appearing for the respondents, on the other hand, submitted that it is true that the respondents have settled the -4- dispute with one of the partners of the firm i.e. brother of the appellant herein. It is clearly provided in the consent terms that the dispute is settled only against the appellant of that appeal i.e. Appeal No. 311 of 2005. He submitted that the respondents have not received the entire amount as part of the amount is still outstanding in connection with the decrees passed in the three suits. He submitted that the appellant is an insolvent and since notice of insolvency is made absolute and since the entire dues cannot be said to be recovered by the respondents, the appeal is required to be decided on its own merits. 5. During the course of hearing, both the learned counsel appearing in the matter fairly submitted that the matter may be remanded to the learned single Judge for deciding the insolvency petition de novo by setting aside the impugned order in view of the fact that even though the appellant had engaged advocates for defending the petition, he did not appear and the petition was decided ex parte. Considering the said aspect, the impugned order is set aside and the matter is remanded to the learned single Judge to decide the petition de novo and preferably within a period of six months from the receipt of this order. Liberty is also granted to the parties to lead appropriate evidence. After remand, the learned single Judge may consider as to whether any amount is still outstanding from the present appellant as well as the effect of the consent terms on the present proceedings. It is clarified that this order is passed with the consent of the learned counsel appearing in the matter. It will be open to both -5- the sides to ventillate their grievance on the point as to whether by the consent terms arrived at between the respondents and the appellant of Appeal No. 311 of 2005, the proceedings against the present appellant can still continue or whether the entire dues of the firm/partners can be said to have been satisfied. All these questions are kept open to the consideration of the learned single Judge and we express no opinion on the merits of the issue involved in the appeal. 6. The appeal is accordingly allowed by setting aside the impugned order dated August 03, 2004. There shall, however, be no order as to costs. P. B. MAJMUDAR, J. R.C. CHAVAN, J.