The Presidency – Towns Insolvency Act,1909
Section 13. Proceedings and order on creditors petition
(1) A creditor’s petition shall be verified by affidavit of the creditor, or of some person on his behalf having knowledge of the facts.
(2) At the hearing the Court shall require proof of
(a) The debt of the petitioning creditor, and
(b) The act of insolvency, or, if more than one act of insolvency is alleged in the petition, some one of the alleged acts of insolvency.
(3) The Court may adjourn the hearing of the petition and order service thereof on the debtor.
(4) The Court shall dismiss the petition
(a) If it is not satisfied with the proof of the facts referred to in sub-section (2); or
(b) If the debtor appears and satisfies the Court that he is able to pay his debts, or that he has not committed an act of insolvency or that for other sufficient cause no order ought to be made.
(5) The Court may make an order of adjudication if it is satisfied with the proof above referred to, or if on a hearing adjourned under sub-section (3) the debtor does not appear and service of the petition on him is proved, unless in its opinion the petition ought to have been presented before some other Court having insolvency jurisdiction.
(6) Where the debtor appears on the petition and denies that he is indebted to the petitioner, or that he is indebted to such an amount as would justify the petitioner in presenting a petition against him, the Court, on such security (if any) being given as the Court may require for payment to the petitioner of any debt which may be established against the debtor in due course of law, and of the costs of establishing the debt, may, instead of dismissing the petition, stay all proceedings on the petition for such time as may be require a for trial of the question relating to the debt.
(7) Where proceedings are stayed, the Court may, if by reason of the delay caused by the stay of proceedings or for any other cause it thinks just, make an order of adjudication on the petition of some other creditor, and shall thereupon dismiss, on such terms as it thinks just, the petition on which proceedings have been stayed as aforesaid.
(8) A creditor’s petition shall not, after presentation, be withdrawn without the leave of the Court.
