Nature of grievance

The law confers a right upon a creditor to move for the Insolvency of an individual if the said individual commits any “act of insolvency”, the acts which are defined under the Insolvency Act. The Insolvency proceedings are maintainable in addition to other remedy of Civil Suits and Criminal actions. Instituting Insolvency proceedings may be very effective way of instilling a healthy fear in the minds of dishonest debtors that if they do not pay the debt, they may be adjudged as an insolvent. On the passing of an order of insolvency, all the properties of the insolvent, wherever situated, are vested in the official Assignee, for its realization and distributed among the body of creditors. One of the important effects of vesting is that the insolvent cannot deal with his property. No buyer from the insolvent can get a good title. Although Insolvency is not a crime per se, yet it brings the collapse of self esteem and perhaps humiliation in the social background