SANKAR RAM & CO vs KASI NAICKER

The Supreme Court addressed the applicability of the proviso to Section 55 of the Provincial Insolvency Act, 1920, determining that a bonafide transferee for valuable consideration is entitled to protection even after the presentation of an insolvency petition but before the adjudication order, provided they had no notice of the insolvency petition. The Court held that the appellant was entitled to recover the amount paid for shares from the bank, reversing the lower court's decision that denied relief based on the timing of the insolvency adjudication. The judgment clarified the rights of transferees in insolvency proceedings under the Act.