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Gopaldas Sambhudas Vs. Vithal Mohanji - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtMumbai
Decided On
Case NumberSecond Appeal No. 30 of 1927
Judge
Reported in(1929)31BOMLR915; 118Ind.Cas.689
AppellantGopaldas Sambhudas
RespondentVithal Mohanji
Excerpt:
.....an agriculturist mortgagor has asked for an account to be taken under sections 12 and 13 of the dekkhan agriculturists' relief act and an account is taken accordingly and it is found at the foot of the account that what is due is greater than the total sum which would be payable in the term of the mortgage, such agriculturist-debtor is liable to pay the larger sum found due on the account, and his liability is not limited be the sum due in the terms of the mortgage.;dadabhni v. dadabhai (1908) i.l.r. 32 bom. 516 s.c. 10 bom. l.r. 745, approved.;raghunath v. ramchandra (1921) i.l.r. 46 bom. 384 s.c. 23 bom. l.r. 1098 and vithaldas bhagwandas v. murtaja hushein (1921) i.l.r. 46 bom. l.r. 267, overruled. - - 1098 which is precisely on all fours with the present case, where it was held..........of this court. the question is whether in a suit in which accounts have been taken under the dekkhan agriculturists' relief act, more can be awarded than could be awarded under the bond itself if no accounts have been taken. in the case of dadabhai v. dadabhai 10 bom. l.r. 745 it was held that section 13 of the dekkhan agriculturists' relief act is imperative, and the amount found due in a suit upon taking accounts must be awarded. on the other hand, in vithaldas bhagwandas v. murtaja huahein 24 bom. l.r. 267 it was held by macleod c.j. that it would be a very curious result if a debtor owing to his seeking the relief afforded by the dekkhan agriculturists' relief act should have to pay more than he is obliged to pay according to the terms of his bond, and 'i cannot imagine that it.....
Judgment:

Baker, J.

1. The point in this case is one of some importance on which there are conflicting rulings of this Court. The question is whether in a suit in which accounts have been taken under the Dekkhan Agriculturists' Relief Act, more can be awarded than could be awarded under the bond itself if no accounts have been taken. In the case of Dadabhai v. Dadabhai 10 Bom. L.R. 745 it was held that Section 13 of the Dekkhan Agriculturists' Relief Act is imperative, and the amount found due in a suit upon taking accounts must be awarded. On the other hand, in Vithaldas Bhagwandas v. Murtaja Huahein 24 Bom. L.R. 267 it was held by Macleod C.J. that it would be a very curious result if a debtor owing to his seeking the relief afforded by the Dekkhan Agriculturists' Relief Act should have to pay more than he is obliged to pay according to the terms of his bond, and 'I cannot imagine that it was ever intended that the law should produce such an extraordinary result as that.' In tie same volume there is another decision, Raghunath v. Ramchandra Bom. L.R. 1098 which is precisely on all fours with the present case, where it was held that once a creditor has taken a bond, then in no possible case can he recover in a suit on the bond more than the principal amount with interest. The case of Dadabhai v. Dadabhai was referred in that case, but it was not overruled. The question is of some importance, and to my knowledge there are several appeals on this very point pending at the present moment. I think it is desirable that the case should be heard by a bench at as early a date as possible. I will accordingly not decide it. There will be no order as to costs.

2. The appeal accordingly was heard by a bench consisting of Patkar and Murphy JJ, on December 5, 1928, when their Lord ships made a reference to a full bench.

Patkar, J.

3. In this case, the plaintiff' sued to recover possession of certain property from the defendant. In the written statement, the defendant claimed that the accounts should be taken under the Dekkhan Agriculturists' Relief Act and that he should be allowed to redeem the mortgage. The suit was converted into a redemption suit, presumably, under Section 15(c) of the Dekkhan Agriculturists' Relief Act. The learned Subordinate Judge on taking accounts found that the principal amount was Rs. 1,570-15-0 and held that Rs. 3,100-8-6 were due on taking accounts under the Dekkhan Agriculturists' Relief Act.

4. On appeal, the learned District Judge held that under the terms of the bond the plaintiff was entitled to recover only Rs. 2,600 and limited the decree to that amount and ordered that the amount should be payable by yearly instalments of Rs. 300 each.

5. The second appeal was heard by Baker J,, who was of opinion that there was a conflict in the decision in the case of Badabhai v. Dadabhai (1908) I.L.R. 32 Bom. 516 on the one hand, and the cases of Vithaldas Bhagwandas v. Muriaja Hushein 24 Bom. L.R. 267 and Raghunath v. Ramchandra Bom L.R. 1098 on the other. It appears from the judgment of Baker J, that there are several appeals on this very point pending at the present moment and he considered it desirable that the case should be heard by a bench.

6. In the present case the amount of the mortgage bond was Rs. 3,400 payable in seventeen instalments of Rs. 200 each out of which four instalments were paid and thirteen remained due. The amount therefore due under the terms of the mortgage was Rs. 2,600. The learned Subordinate Judge on taking the accounts found that Rs. 3,100-8-7 were due at the foot of the accounts. The learned District Judge considered that he was bound to follow the case in Vithaldas v. Murtaja, and limited the decree to the amount of Rs. 2,600.

7. In Dadabhai v. Dadabhai it was held that when an account has been taken under Section 13, Clause (ft), of the Dekkhan Agriculturists' Relief Act, the balance appearing due shall be deemed to be the amount payable at the date of the suit, and that Section 13 of the Dekkhaa Agriculturists' Relief Act is imperative, and the amount due in a suit, for redemption of a usufructuary mortgage, in which the provisions of 8. 12 of the Act have been complied with, is the amount which is found to be due upon taking accounts in the manner provided by Section 13, In that case the mortgage was a Paikar J, usufructuary mortgage for Rs. 2,499 and on taking accounts under Section 13 the sum payable was found by the Commissioner to be in excess of Rs. 2,499, a result which was not expected by the agriculturist mortgagor, and the case was remanded to the lower Court in order that a decree should be passed in accordance with the result of the account taken under Section 13 of the Dekkhan Agriculturists' Relief Act. In Raghunath v. Ramohandra it was held, distinguishing the case of Dadabhai v. Dadabhai, that when, once a creditor has taken a bond, then in no possible ease can he recover in a suit on the bond more than the principal amount with interest, because, as a rule the object of directing accounts to be taken under the Dekkhan Agriculturists' Relief Act is to ascertain how much of the amount secured by the bond is principal and how much interest after going into the history of the transactions between the parties, In that case the mortgage was for Rs. 1,500 and on taking accounts under the Dekkhan Agriculturists' Relief Act, the principal sum found due was Rs. 3,338-2-0 and a like amount for interest and it was held that a decree could not be passed for more than Rs. 1,500 as principal and a like amount for interest. In the present case the principal amount for the unpaid thirteen instalments is Rs. 2,600 and on taking accounts a lesser sum, i. e., Rs. 1,570-15-0 was found due as principal and about Rs. 1,530 was found due as interest, in all Rs. 3,100-8-6 were found due, but the learned District Judge held that a decree could not be passed for more than Rs. 2,600 due under the terms of the bond. In Vithaldas v. Murtaja it was held that although on the report of the Commissioner there appeared payable, for principal and interest, the sum. of Rs. 12,462-4-0, yet inasmuch as there remained only Rs. 9,500 due on the bond itself, a decree for that amount only should be passed. In that case a suit was brought to recover Rs. 6,000, amount of twelve instalments due till 1916 on an instalment mortgage bond for Rs. 15,000. According to the terms of the bond eleven instalments were already paid and Rs. 9,500 was the balance due on nineteen unpaid instalments, On taking accounts the Commissioner found that Rs. 6,231-10-0 were due for principal and a like amount for interest, in all Rs. 12,463-4-0. The learned Subordinate Judge held Rs. 3,200 were due for principal and passed a decree for Rs. 6,400 inclusive of interest. It was held that the Subordinate Judge erred in holding that only three bonds of Rs. 2,000, 400 and 800, in all Rs. 3,200 were for cash consideration, and that the account taken by the Commissioner that Rs. 6,231-10-0 as principal and a like amount for interest was due, was correct, but a decree was passed for Rs. 9,500, the amount of nineteen unpaid instalments due under the terms of the bond. The decision thus arrived at is in conflict with the decision in the case of Dadabhai v. Dadabhai, where although Rs. 2,499 were due under the terms of the usufructuary mortgage, it was held that the mortgagee would be entitled to recover whatever would be found due on taking accounts under Article 13 of the Act even though it was in excess of the amount due under the terms of the mortgage. The decision is also in conflict with the decision ' reached in Jiaghunath v. Ramchandra, where if was held that on taking accounts a creditor could recover principal for sum not exceeding the amount mentioned in the bond and also interest. The amount duo for principal on taking accounts was Rs. 6,231-10-0 and was less than Rs. 9,500, balance of the principal mentioned in the bond, and a like amount was found due on interest, still a decree was passed for Rs. 9,500, the amount due under the terms of the bond disregarding the account taken under Section 13 of the Act which was found to be correct. It appears to us that there is conflict in the decisions in the cases of Dadabhai v. Dadabhai and Vithaldas v. Murtaja and Raghunath v. Ramchandra, on the point as to whether in a suit in which accounts have been taken under the Dekkhan Agriculturists' Relief Act more can be awarded than could be awarded under the terms of the bond itself if no accounts were taken under the Dekkhan Agriculturists' Relief Act. We think, therefore, that the matter should be decided authoritatively by a decision of the Full Bench. We would refer the following question for the decision of the Full Bench :-

Whether when an agriculturist mortgagor has asked for an account to be taken under Sections 1a and 1H of the Dekkhan Agriculturists' Relief Act and an account is taken accordingly am! it is found at the foot of the account that what is due is greater than the total sum which would be payable in the terms of the mortgage, such agriculturist debtor is liable to pay the larger sum found due on the account, or his liability is limited to the sum due in the terms of the mortgage?

Murphy, J.

8. I agree that a reference should be made to the Full Bench, for I do not find myself able to reconcile the ruling in Dadabhai v. Dadabhai with the grounds of decision in the two later cases, Vithaldaa v. Murtaja and Raghwnath v. Ramchandra.

9. The reference was heard by a Full Bench consisting of Mad-gavkar, Patkar and Wild JJ., on June 10, 1929.

10. K.H. Kelkar, for the appellant. Section 13 of the Dekkhan Agriculturists' Relief Act is mandatory in its terms. It requires that the contract between the parties should be set aside, which means that it should be set aside as against both parties, When once the contract is set aside and the real transaction restored, the result of the accounts must be given effect to, even if it presses against the agriculturist. In all such accounts the creditor starts with a great disadvantage against himself, as the capital is written down, If in such cases any hardship is felt, it is for the legislature to intervene.

Y.V. Dixit, for the respondent, Section 13 involves the supposition that the contract between the parties is onerous and inequitable; and the Court has to consider whether the terms are oppressive or otherwise. The section only provides procedure. The debtor therefore need not be penalised if the result of the accounts turns out to be unfavourable to him. The whole scheme of the Act being protection of agriculturists, the section should be construed so as to further that object. The view taken in Dadabhai v. Dadabhai puts an agriculturist mortgagor to unnecessary hardship, and defeats the purpose of the Act.

Madgavkar, J.

11. The question referred to the Full Bench is as follows:-

Whether when an agriculturist mortgagor has asked for an account to be taken under sa. 12 and 13 of the Dekkhan Agriculturists' Relief Act and an account is taken accordingly and it is found at the foot of the account that what is due is greater than the total sum which would be payable in the term of the mortgage, such agriculturist debtor is liable to pay the larger sum found due on the account, or his liability is limited to the sum due in the terms of the mortgage?

12. It is pointed out in the referring judgment that it was held by Scott C.J. in Dadabhai v. Dadabhai 10 Bom. L.R. 745 that the provisions of as', 12 and 13 of the Dekkhan Agriculturists' Relief Act were imperative and the result of the account ho taken must be embodied in the decree even if the amount found due was greater than the amount due under the terms of the original mortgage; but subsequently it was held by Macleod G.J. in two cases, Raghunaih v. Ramchandra1 I.L.R(1921) .Bom. 384 and Vithaldas Bhagwandas v. Murtaja Huahein 24 Bom. L.R. 267 that the legislature could not have meant that by reason of an act admittedly meant to benefit the agriculturist a decree should be passed against him for an amount larger than what it would have been but for the Act and for accounts taken there under. It is pointed out by my learned brother Patkar that these two decisions of Macleod C.J. are not themselves quite reconcileable, the one limiting the creditor to the principal amount and the other to the amount of principal with interest on the footing of the original mortgage.

13. That the terms of Sections 12 and 13 of the Dekkhan Agriculturists' Kelief Act are imperative, there can be no question in view of the word 'shall' used at the beginning of s. IB as well as in Clause (g). The only question, therefore, is whether merely by reason of the Act being meant generally for the relief of the agricultural class, it is nevertheless open to the Courts to imply a clause, that, notwithstanding the imperative language of the section, it is open to the Courts to set aside the accounts and the result, if the amount is found to be larger than the amount due on the original mortgage between the parties. I am aware of no canon of interpretation by which the Court a can read such a clause into the section and arrogate these powers to themselves. It would have been simple for the legislature, had it desired to give the agriculturist the benefit of such a clause, to have said so, and to have directed that there should be a decree for such an amount on the account only where the amount so found was not greater than the amount on the original mortgage. Failing such a clause, mere general considerations of benefit to the agriculturist are, in my opinion, insufficient to support the view of Macleod C.J. on which the two decisions, Baghunath v. Bamchandra and Vithal-das v. Murtaja, are based. I prefer the reasoning of Scott C.J. in Dadabhai v. Dadabhai. It may be that in certain cases this may cause hardship to the agriculturist, but the proper answer is that it is perfectly open to the agriculturist to refrain from setting up such a status and asking for such accounts, if the result is likely not to be to his benefit. Further, with the large discretion allowed to the Courts in the matter of fixing the interest, such cases are few and far between. That presumably is the reason why the legislature did not think it necessary to contemplate such an alternative and give the Courts the explicit power without which the decisions in Baghunath v. Bamchandra and Vithaldas v. Murtaja respectively cannot, in my opinion, stand. In any case a few possible hard cases cannot be allowed to affect the plain terms of the Act and their clear meaning.

14. My answer to the question, therefore, is as follows :-

15. When an agriculturist mortgagor has asked for an account to be taken under Sections 12 and 13 of the Dekkhan Agriculturists' Relief Act and an account is taken accordingly and it is found ' at the foot of the account that what is due is greater than the total sum which would be payable in the terms of the mortgage, such agriculturist debtor is liable to pay the larger sum found due on the account, and his liability is not limited to the sum due in the terms of the mortgage.

Patkar, J.

16. I agree

Wild, J.

17. I agree


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