Report No. 26
9. Official Assignees and Official Receivers.-The Presidency Act provides for the appointment in each of the Presidency-towns of Bombay, Madras and Calcutta of an officer called the Official Assignee, in whom all the property of the insolvent is vested.1 The Official Assignee is constituted a corporation sole in Bombay and Madras by local amendments. (See section 77A, Presidency Act). The scheme of the Provincial Act is different2. Section 57 of that Act provides for the appointment of an Official Receiver. Such appointment is not obligatory. Under section 28(2) of the Act, on the making of an order of adjudication the property of the insolvent vests either in the court or in a receiver.
Where an Official Receiver has not been appointed, the Court generally appoints, ad hoc for each insolvency a member of the Bar or a ministerial officer of the court to discharge the functions of the receiver. The defects of this system have been pointed out in an earlier Report of the Law Commission3. In that Report, it has been stated that in the States of Madras and Andhra Pradesh where Official Receivers are appointed for an entire area the results have been more satisfactory.
Under section 58 of the Provincial Act, where no receiver is appointed the property vests in the Court. But the vesting of the property in the court is not convenient and may lead to complications. We are, therefore, of the opinion that the system of vesting the insolvent's estate in the Court and leaving it to the court to appoint a receiver ad hoc should be abolished. We think that in this respect the provisions of the Presidency Act are better, and should apply throughout India. This change would assimilate the position in the mofussil to that obtaining in the Presidency-towns, and it would also facilitate the administration of estates in insolvency4.
1. See section 77, Presidency Act.
2. See sections 56, 57 and 58, Provincial Act.
3. 14th Report, Vol. I.
4. See App I, clause 88.