If we are declared bankrupt can we avoid our loans

767 votes

You are correct in saying that, during the bankrupcy proceedings, if any creditor of your father brings it to the notice of the Court that, your father recently, before filing an insolvency petition, transferred the land in favour of your mother deliberately to defraud the creditors, the court can view the transaction as fraudulent and the court can reverse the transfer. To avoid this, your father and mother will be required to prove that, the land was purchased by using your mother's hard earned money and the transaction was not fraudulent. However, if your father has mortgaged the said land with any creditor (before transfer of the land to your mother), with consent of your mother, your mother can not avoid the consequences. If none of the creditors raises the objection, your mother's land will be automatically saved.

Advocate Unmesh Gopal Dindore LawRato