Section 124 of THE PRESIDENCY-TOWNS INSOLVENCY ACT, 1909
–(1) No person shall, as against the official assignee, be entitled to withhold possession of the books of accounts belonging to the insolvent or to set up any lien thereon.
- (2)Any creditor of the insolvent may, subject to the control of the Court, and on payment of such fee, if any, as may be prescribed, inspect at all reasonable times, personally or by agent, any such books in the possession of the official assignee.
Summary
- –(1) No person shall, as against the official assignee, be entitled to withhold possession of the books of accounts belonging to the insolvent or to set up any lien thereon.
- (2) Any creditor of the insolvent may, subject to the control of the Court, and on payment of such fee, if any, as may be.
Practical examples
FAQ
1. Can an accountant keep a bankrupt person's ledger if they are unpaid under the Presidency-towns Insolvency Act?
No. Under Section 124 of the Presidency-towns Insolvency Act, 1909, no person can keep or withhold the account books of an insolvent person from the official assignee. You cannot claim any legal right to keep them, even if you are owed money.
2. How can a creditor inspect the financial books of an insolvent debtor under the 1909 Presidency-towns Act?
Under Section 124 of the 1909 Act, a creditor can personally inspect the insolvent debtor's account books held by the official assignee, or send an agent to do so. This must be done at reasonable times, is subject to court control, and may require paying a set fee.
3. Does an agent have a right to hold back account books against the official assignee under Section 124 of the Presidency-towns Insolvency Act, 1909?
No. Section 124 of the Presidency-towns Insolvency Act, 1909 makes it clear that no person has any right to withhold possession of the insolvent person's books of accounts from the official assignee.
Test yourself
Q1.Under Section 124 of THE PRESIDENCY-TOWNS INSOLVENCY ACT, 1909, who is entitled to take possession of the insolvent debtor's books of accounts, even if another person claims a lien, which is a legal right to hold property as security, on them?
Q2.Under Section 124 of THE PRESIDENCY-TOWNS INSOLVENCY ACT, 1909, what must a creditor do to inspect the account books of an insolvent person that are in the possession of the official assignee?
Q3.If a person claims a lien, which is a legal right to keep possession of property until a debt is paid, on the account books of a debtor, what is the status of that lien under Section 124 of THE PRESIDENCY-TOWNS INSOLVENCY ACT, 1909, once the debtor is adjudged insolvent?
Q4.Under Section 124 of THE PRESIDENCY-TOWNS INSOLVENCY ACT, 1909, how may a creditor conduct an inspection of the insolvent debtor's books of accounts?