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2023 (9) TMI 52 - HC - Indian LawsDishonour of Cheque - insufficient funds - Seeking a judgment and a decree jointly and severally against the defendants as guarantors under the deeds of guarantee dated 21st March 2018 executed by the defendants respectively in favour of the plaintiff - whether the matter could be preceded with ex-parte when during the pendency of the suit, the defendants were adjudged the insolvents? HELD THAT:- With regard to the Court’s query as to whether the suit can proceed when the Defendant is adjudicated insolvent pending the suit, in view of the Division Bench judgement of this Court in the case of Om Prakash Nihalani [2008 (12) TMI 831 - BOMBAY HIGH COURT], there are no impediment in proceeding to pass a decree. The Division Bench has concurred with the view taken by the Madras High Court in the case of Official Assignee, High Court Madras & Ors. [1980 (2) TMI 287 - MADRAS HIGH COURT]. The Madras High Court held that under Cl.(d) of section 68(1) the official assignee would be a necessary party only if the suit was “relating to the property of the insolvent”, and the term “relating to” cannot be taken to mean “affecting”. Thus, the Defendant has been adjudicated insolvent pending the proceeding, as it is a money decree and does not “relate to” the property of the defendant section 68(1)(d) is not attracted and the official assignee is not required to be made a necessary party. Thus, as per Order XXXVII Rule 6 (a) of the Code of Civil Procedure, the plaintiff is entitled to a judgment forthwith - suit disposed off.
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