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Daneppa Satveerappa Vs. Malgonda Ananda - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberCivil Revn. Appln. No. 553 of 1954
Judge
Reported inAIR1956Bom630; (1956)58BOMLR324; ILR1956Bom497
ActsDebt Law; Bombay Agricultural Debtors Relief Act, 1947 - Sections 22, 22(1), 22(6), 23, 31, 31(2), 32 and 46; Code of Civil Procedure (CPC), 1908 - Order 34, Rules 2 and 7; Dekkhan Act - Sections 13
AppellantDaneppa Satveerappa
RespondentMalgonda Ananda
Appellant AdvocateB.M. Kalagate, Adv.
Respondent AdvocateK.B. Sukthankar, Adv.
Excerpt:
.....of 1908), order xxxiv--whether accounts can be taken under act between debtor and creditor between date of application for adjustment of debts and date of award.;under the bombay agricultural debtors relief act, 1947, accounts can be taken between the creditor and the debtor subsequent to the making of the application for adjustment of debts and upto the date when the award is made.;dattatraya v. mahomedkhan (1934) 37 bom. l.r. 76 relied upon. vithoba nilo naik v. bhagirathi babu rane (1952) civil revision application no. 157 of 1952, decided by chagla c.j., on november 28, 1952 (unrep.) referred to. - indian evidence act, 1872 section 24: [v.s. sirpurkar & deepak verma,jj] dying declaration - multiple murders by accused - dying declaration not implicating one accused - evidence of..........of the lower appellate court. he argues that the judgment under revision does not show that the learned judge really took accounts as required by section 22; and he further contends that the conclusion recorded by the lower appellate court in a general form, that however accounts may be made nothing would be found due to the mortgagee, is presumably based upon the assumption that accounts can be and should be taken between the date of the application and the date of the award.before the learned district judge it was urged by the petitioner that the mortgagee had paid assessment and taking into account the interest which the mortgagee thereby became entitled to recover from the mortgagor the amount due to him from the mortgagor in that behalf would be rs. 1,330/- upto the date of the.....
Judgment:
ORDER

1. This revision application raises a short question under the B. A. D. R. Act which is not easy to decide, The question is in respect of the accounts that are required to be taken in the adjustment of debts. The relevant sections to which ray attention has been drawn in the course of hearing of this revisional application are Sections 22, 23, 31, 32 and 46. Broadly stated, the effect of Sections 22, 23, 31 and 32 is that accounts have to be taken in the manner prescribed by Section 22.

The profits have to be determined in appropriate cases in the manner prescribed by Section 23 and the amounts due by the debtor to the creditor have to be scaled down in the manner laid down by Section 31, Sub-section (2). Section 32 then provides for the making of an award. While taking accounts under these relevant sections, the last date upto which accounts are taken is the date of the application.

But it is obvious that some time is bound to elapse between the making of the application and the passing of the award. The question which is raised for my decision in the present revisional application is whether accounts can be taken between the debtor and the creditor between the date on which the application was made and the date on which the award has been passed.

It does appear that in respect of this period there is a lacuna in the provisions of the Act and Mr. Kalagate for the creditor has contended that there is no jurisdiction in the B. A. D. R. Act Court to take such accounts. That is how the short point which I have to decide is whether accounts can be taken between the creditor and the debtor subsequent to the making of. the application and up to the date when the award is made.

2. The transaction in question took place on the 30th of May 1885. It was a possessory mortgage for Rs. 1000/-. The property mortgaged consisted of two fields Survey No. 7 and Survey No. 17/3. The mortgagor had stipulated that, in case the mortgagee was required to pay assessment the mortgagor would be liable to pay interest on the amount of assessment so paid at 12 per cent, per annum.

Both the Courts have held that on taking accounts between the parties nothing is found due from the mortgagor to the mortgagee and an award has been passed to the effect that the mortgage is satisfied and a direction has been issued to the mortgagee to deliver possession of the mortgaged properties to the debtor.

According to Mr. Kalagate, there are two infirmities in the judgment of the lower appellate Court. He argues that the judgment under revision does not show that the learned Judge really took accounts as required by Section 22; and he further contends that the conclusion recorded by the lower appellate Court in a general form, that however accounts may be made nothing would be found due to the mortgagee, is presumably based upon the assumption that accounts can be and should be taken between the date of the application and the date of the award.

Before the learned District Judge it was urged by the petitioner that the mortgagee had paid assessment and taking into account the interest which the mortgagee thereby became entitled to recover from the mortgagor the amount due to him from the mortgagor in that behalf would be RS. 1,330/- upto the date of the application. Making a deduction of 40 per cent. from this amount, the mortgagee would be entitled to claim Rs. 798/-.

The learned District Judge took the view that, though this claim may be Justified, after taking accounts the claim would not really survive because the mortgagee had received by way of income from the land more amount than he was entitled to receive by way of interest. It was common ground between the parties before the learned District Judge that the income from the lands upto 1942-43 was Rs. 75/- per year and thereafter it was Rs. 200/- per year.

The learned Judge has observed that he was satisfied that, on taking accounts, nothing would be found due to the mortgagee. It does not appear from the Judgment, however, that any ac-counts were actually taken by the learned District Judge as required by Section 22. Section 22 Sub-section (1) (a) requires separate accounts of principal and interest to be taken, and Sub-clause (b) requires that in the account of principal there shall be debited to the debtor only such money as may from time to time have been actually received by him or on his account from the creditor.

Then Section 22, Sub-section (2) deals with the taking of accounts of transactions which commenced before the 1st of January 1931, and Sub-section (6) provides for the manner in which the amount due has to be determined. In my opinion, the learned District Judge should have taken accounts -- specifically under the relevant provisions of Section 22 and then proceeded to scale down the amount due, if any, to the mortgagee under Section 31, Sub-section (2).

The general finding that nothing would remain due to the mortgagee is not satisfactory because we really do not know whether accounts had been made as laid down by Section 22. That is why I think it is necessary that the order passed by the learned District Judge should be set aside and the matter sent back to his Court with a direction that accounts should be properly taken as required by Section 22 and an award should follow thereafter.

3. In directing that accounts should be taken under Section 22, I must deal with the second point which has been raised by Mr. Kalagate and that is that no accounts can be taken from the date of the application to the date of the award. As I have already observed, if I were to go strictly by the terms of the relevant sections, it would have to be conceded that there is a lacuna in this matter and Mr. Kalagate would 'prima facie' be justified in arguing that the Act has made no provision for taking accounts during such period. But, on the other hand, this lacuna should not, if possible, be allowed to defeat legitimate accounting between the parties.

There is no doubt that until the award is passed the property is subject to the mortgage and the parties continue to be mortgagor and mortgagee. It is only after an award is passed that a statutory charge comes into existence. In every case some time is bound to be taken by the proceedings between the making of the application and the passing of the award and it would be extremely unreasonable to assume that Legislature intended that no accounts should be taken between the mortgagor and the mortgagee for the period in question.

If the mortgage continues to subsist until the award is made, accountability between the mortgagor and the mortgagee must be deemed to be continued and accounts must be taken before the liability of the mortgagor is finally determined. I am, therefore, inclined to think that, though there is a lacuna in this matter in the provisions of the B.A.D.R. Act, it would be legitimate to take recourse to the general provisions of the Code of Civil Procedure for the purpose of taking accounts during such period.

Section 46 of the Act provides that the provisions of the Civil Procedure Code would apply to proceedings under Chapter II of the Act, save as otherwise expressly provided in the Act. In other words, if it had been expressly provided in the B.A.D.R. Act that the relevant provisions of taking accounts which are included in Order 34 of the Code should not be invoked in adjustment proceedings, it would have been another matter.

The only provision which can be regarded, as material in this matter would be the provision of scaling down. There is a provision as to how debts have to be scaled down under Section 31 and it must be conceded that when applying the Code of Civil Procedure for taking accounts subsequent to the making of the application and prior to the passing of the award it would not be open to the Court to invoke the provisions relating to scaling down contained in Section 31.

But save for this provision, I do not see why the relevant rules for taking accounts contained in the Code of Civil Procedure should not be invoked in adjusting the debts under the provisions of the B.A.D.R. Act. That is why, I think, the Courts below were right in assuming that, before the amount due to the mortgagee is finally determined, it would be necessary to take accounts of the dealings between the parties from the date of the application to the date of the award.

4. Mr. Kalagate has invited my attention to a judgment delivered by the learned Chief Justice in Civil Revision Application No. 157 of 1952 in which the learned Chief Justice has pointed out that there is a lacuna in the matter and that in order to enable accounts to be made it would be legitimate to take recourse to the general provisions of the law. I do not find anything in this Judgment which is inconsistent with the view that I am disposed to take in the matter.

I should like to add that I feel fortified in coming to the conclusion that I have reached in this case by the decision of this Court in 'Dattatraya Gopal v. Mahomedkhan Fatehkhan' AIR 1935 Bom 122 (A). Murphy and Macklin JJ., had to deal with a similar question under the provisions of Section 13, Dekkan Agriculturists Relief Act.

Section 13 of the Dekkhan Act, which provided for the taking of accounts between agriculturists as defined under the Act and their creditors, had laid down, like Section 22 of the present Act, for the taking of accounts up to the date of institution of the suit, and it was in the light of this specific provision contained in Section 13 of the Dekkhan Act that this Court had to consider in Dattatraya's case whether accounts subsequent to the date of the suit could not be taken under the general provisions of Order 34. Rule 7: and the answer that was given by the learned Judges who decided this case was in favour of invoking Order 24, Rule 7, and taking accounts under its provisions.

The material words used in Section 13 of the Dekkhan Act are substantially similar to the words used in the corresponding clause of Section 22 of the present Act, and I think it would be legitimate to rely upon the reasons given by Murphy J. who delivered the Judgment of the Bench in support of the view that I am taking in the present case.

5. In the result, the revisional application would be allowed on the technical ground that accounts do not appear to have been properly taken. The order passed by the District Court would toe set aside and the matter sent back to the learned District Judge with a direction that the accounts between the parties should be taken in the light of this Judgment.

6. The costs incurred by the parties so far would be costs in the appeal before the learned District Judge.

7. Application allowed.


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