P L D 1976 Karachi 859 (PLP)

4. It is worth noting that the insolvents' Manager Partner, Gul Muhammad was publicly examined as to their affairs by the Official Assignee and none of the creditors took part in the public examination.

5. The Official Assignee has submitted his report wherein he has mentioned that the insolvents do not appear to have committed offences under the provisions of sections 421 to 424, P. P. C. or under the provisions of the Insolvency Act, but, however, he has pointed out that the insolvents' assets are not of a value equal to four annas (25 paisas) in a rupee on the amount of their unsecured liabilities, which is one of the material considera tions for granting or refusing an absolute order of discharge.

6. By section 39(1) of the Insolvency Act, it is provided that the Court shall refuse the discharge in all cases where the insolvent has committed any offence under the Act or under sections 421 to 424, P. P. C. and shall on proof of any of the facts mentioned therein, either :- (a) refuse the discharge ; or (b) suspend the discharge for a specified time ; or (c) suspend the discharge until a dividend of not less than four annas in the rupee has been paid to the creditors ; or (d) require the insolvent as a condition of his discharge to consent to a decree being passed against him in favour of the Official Assignee for any balance or part of any balance of the debts provable under the insolvency which is not satisfied at the date of his discharge; such balance or part of any balance of the debts to be paid out of the future earnings or after-acquired property of the insolvent in such manner and subject to such conditions as the Court may direct.

7. Therefore, the learned Official Assignee, contends that in view of the fact that the assets of the insolvents are not of a value equal to four annas in the rupee on the amount of their unsecured liabilities, and in view of the provisions of section 39(1) of the Act, I cannot grant an order of absolute discharge, but, however, I have discretion either to refuse the discharge; or suspend the discharge for a specified time or suspend the discharge until a dividend of not less than four annas in the rupee has been paid to the creditors or require the insolvents as a condition of their discharge to consent to a decree being passed against them in favour of the Official Assignee for any balance 6r part of the balance of the debts provable under the insolvency as provided in clause (d) of subsection (1) of section 39 of the Insolvency Act. The learned Official Assignee has, therefore, suggested that I may suspend the discharge until the dividend of not less than four annas in the rupee has been paid to the creditors, as the insolvents are not willing to consent to a decree as provided in clause (d) of subsection (1) of section 39 of the Insolvency Act.

8. On the other hand, Mr: G. Raymond, the learned Advocate for the insolvents has contended that the provisions of section 39(1) are not attracted to the case of the insolvents and I can grant an absolute order of discharge because there is enough material on the record to satisfy me that the. insolvents' assets are not of the value equal to four annas in the rupee on the amount of their unsecured liabilities not because the insolvents lost their assets due to circumstances over which the insolvents had control but due to disturbances in East Pakistan and subsequent secession of East Pakistan from Pakistan, the facts for which the insolvents could not justly be held responsible.

9. I entertain no doubt that the loss of assets was due to the reason stated above and cannot be attributed to the act of bad faith or negligence on the part of the insolvents. I am also of the opinion that none of the facts enumerated in subsection (2) of section 39 of the Act are present iii the case under consideration, so as to attract the provisions of subsection (1) thereof.

10. As regards the conditional order of discharge Mr. Raymond has contended that no such order can be passed in the present case as there are no apparent or reasonable prospects that some funds or property will be forthcoming, and will be available for payment of the debts of the insolvents. In support of his contention, the learned Advocate for the insolvents has relied upon the case of In re : Marley ; Ex parte Marley (82 L T R 632). In that case on the insolvent's application for discharge the Court bad ordered that the discharge be suspended until a dividend of 10 s. in the pound should have been paid to the creditors. On appeal it was, however, held by Wright, J., Darling, J., being of the same opinion, that ;-- "It is however the usual and settled practice of this Court, under the present Act equally as under the former, not to make the particular order that was made in the present case, unless there is a reasonable prospect that some funds or property will be forthcoming, and will be, made available for the payment of the debts of the bankrupt. In the present case there was no apparent prospect of the bankrupt acquiring any funds or property available for the payment of his debts."

11. In the present case also there is nothing on the record to show that there is any reasonable prospect of the insolvents acquiring any funds or property for the payment of their debts. It was for the creditors to come forward to show that there were reasonable prospects that the insolvents would acquire some funds. or property. But not only that they did not take part in public examination of the insolvents but also one of the creditors who was represented by an advocate in these proceedings was not present or present on the date of hearing of the present application. This shows complete lack of interest on their part or that they have no objection if an order of absolute discharge as prayed is passed.

12. It cannot be disputed that Insolvency Act, by section 38 gives the Court wide powers as to the order which may be made upon the insolvent's application for discharge. So long as the provisions of section 39 subsection (1) of the Act read with subsection (2) thereof are not attracted, the Court has discretion to pass an absolute order of discharge, and, therefore, under the circumstances of this case and following the opinion expressed In re : Marley for reason that the provisions of section 8(2) of the Bankruptcy Act, 1890 (53 and 54 Vic c. 71) on the basis of which the English case was decided, are almost in pari materia with the relevant provisions of sections 38 and 39 of the Insolvency Act. 1909, I grant the application and pass an order of absolute discharge of the insolvents. S. Q. Application granted.