2. The Hearing of the Petition:

Bankruptcy Rules
Under BR 125 where a petition is filed by a debtor the court shall forthwith make a receiving order thereof.
  1. The hearing of a creditor’s petition takes place after the expiration of 8 days from the date of service thereof on the debtor.
  2. But a hearing within the 8 days may be ordered, where the debtor has filed a declaration of inability to pay his debts or where the debtor has absconded or for any good cause shown.


Under BR 128 if the debtor wishes to oppose the petition he must file a notice with the registrar of the court specifying the statements in the petition which he denies.  Further he must also send a copy of the notice to the petitioning creditor 3 days prior to the date of the hearing.  

At the hearing set by the registrar under BR 126 the petitioning creditor must prove:
  1. The debt. 
  2. Service of the petition on the debtor.
  3. The act of bankruptcy being relied on
Thereupon the court may make a receiving order as per section 5 BA for the protection of the Estate.
1.    If the court is not satisfied with proof of any of these matters or is satisfied by the debtor that he is able to pay his debt or that for other sufficient cause no order ought to be made it may dismiss the petition under Section 7 (3) of the BA.

2.    If the Act of bankruptcy which is being relied upon is non-compliant with a bankruptcy notice the court may if it thinks fit stay or dismiss the petition if an appeal is pending from the judgment or order.  Section 7(4) as read with 7(5) BA.

The court may also stay all proceedings on the petition if the debtor denies indebtness to the petitioner or the amount of the debt until that has been determined.  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 a receiving order on the petition of some other creditor and shall thereupon dismiss on such terms as it thinks fit the petition in which proceedings have been stayed.

A creditor cannot rely upon an act of bankruptcy committed before his debt came into existence but the debt need not have been due to the petitioning creditor at the date of the act of bankruptcy.  A petition once presented cannot be withdrawn without leave of the court.


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