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Report No. 16

5. Insertion of a provision similar to section 26 of the Administrator General's Act.-

The second suggestion made by the Government of West Bengal is that a provision similar to section 26 of the Administrator-General's Act1 may be incorporated in the Official Trustees Act. Section 26 of the Administrator-General's Act empowers the Administrator-General to decide the claims of the creditors and others against the estate of deceased in the course of the administration of the assets of the deceased.

We cannot agree with the suggestion. Leaving aside for a moment the exceptional case under section 7(6) of the Official Trustees Act, the functions of the Official Trustee are entirely different from those of the Administrator-General. The Official Trustee has merely to carry out the execution of the trust for which he is the trustee and the question of deciding the claims of creditors against the trust seldom arises. All that he has to do is to pay the beneficiaries what is due to them under the trust and, if any difficulty arises, to apply to the High Court for directions.

He stands, generally speaking, in the same position as a private trustee under the Indian Trusts Act. If a private trustee has no power to decide and adjudicate upon any claims under the Trusts Act, there is no reason to vest such a power in the Official Trustee. Where the Official Trustee happens to be the sole executor and trustee under section 7(6) of the Official Trustees Act, he stands, so far as the executorial functions are concerned, in the same position as an ordinary executor and holds the estate as trustee after the administration is completed and the residue ascertained2.

By way of contrast it may be noted that the functions of the Administrator-General are different in nature. The proceedings before him are to a certain extent really a substitute for a suit for the administration of the estate, and it is on this that his powers and duties are based3. We, therefore, arrive at the conclusion that there is no justification for incorporating the provisions of section 26 of the Administrator-General's Act in the Official Trustees Act.

1. Section 26 of the Administrator-General's Act reads thus:

"26. (1) When the .Administrator-General has given the prescribed notice for creditors and others to send in to him their claims against the estate of the deceased, he shall, at the expiration of the time therein named for sending in claims be at liberty to distribute the assets or any part thereof in discharge of such lawful claims as he has notice of.

(2) He shall not be liable for the assets so distributed to any person of whose claim he had not notice at the time of such distribution.

(3) No notice of any claim which has been sent in and has been rejected or disallowed in part by the Administrator-General shall affect him unless proceedings to enforce such claims are commenced within one month after notice of the rejection or disallowance of such claim has been given in the prescribed manner and unless such proceedings are prosecuted without unreasonable delay.

(4) Nothing in this section shall prejudice the right of any creditor or other claimant to follow the assets or any part thereof in the hands of the persons who may have received the same respectively.

(5) In computing the period of limitation for any suit, appeal or application under the provisions of any law for the time being in force, the period between the date of submission of the claims of a creditor to the Administrator-General and the date of the final decision of the Administrator-General on such claim shall be excluded.".

2. The question-"When an executor becomes the trustee where he is appointed as executor and trustee under the will" has been considered in a number of cases-See in this connection Raghavalu Naidu v. Commissioner of Income-Tax, AIR 1950 Mad 790.

3. He has, for example, to administer the estate and decide claims of creditors and legatees when he obtains letters of administration under the various provisions already noted-See para. 4, foot-note.

Report on the Official Trustees Act, 1913 Back

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