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Rajendra Bhati Vs. Babulal Tarachand and Co. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberCivil Revision Application No. 441 of 1980
Judge
Reported in1982(1)BomCR333
ActsMaharashtra Debt Relief Act, 1975 - Sections 2, 4, 7, 11 and 12; Code of Civil Procedure (CPC) , 1908 - Sections 11 - Order 21, Rule 22
AppellantRajendra Bhati
RespondentBabulal Tarachand and Co.
Appellant AdvocateC.K. Jaisinghani, Adv.
Respondent AdvocateH.V. Chande, Adv.
Excerpt:
.....determination - matter remanded to authorised authority - on determination of matter by authorised officer civil court will deal with and dispose of plaintiff's notice under order 21 rule 22. - - the learned judge held that this plea could have been raised by the defendant in the suit itself at the time of the passing of the decree since the maharashtra debt relief ordinance had come into force on 27-8-1975. since the defendant had failed to take up such a plea, the issue had become barred by the principle of res judicata. daryao kunwar, reported in [1966]3scr300 ,wherein the learned judge had held :reliance in this connection is placed on the well settled principle that in order that a matter may be said to have been heard and finally decided, the decision in the former suit must..........principles of res judicata under section 11 of the civil procedure code could not apply unless the suit or issue in which the matter directly and substantially in issue had been directly and substantially in issue in a former suit between the same parties, and such an issue had been finally heard and decided by the court. section 11 of the code of civil procedure lays down :---'11. res judicata.no court shall try any suit or issue in which the matter directly and substantially in issue had been directly and substantially in issue in a former suit between the same parties, or between parties under whom they or any of them claim, litigating under the same title, in a court competent to try such subsequent suit or the suit in which such issue has been subsequently raised, and has been heard.....
Judgment:

D.N. Mehta, J.

1. The petitioner in this revision application has impugned the judgment and order of the learned Judge of the Bombay City Civil Court of the 17th April, 1980 wherein the plea of the petitioner that he was a 'debtor' within the meaning of the Maharashtra Debt Relief Act, 1975 (Act No. III of 1976), was rejected.

2. Before dealing with the rival contentions of learned Advocates, it will be pertinent to set out briefly a few facts. The respondent (who will hereinafter be refereed to as 'the plaintiff') filed a summary suit in the Bombay City Civil Court at Bombay against the present petitioner (who will hereinafter be referred to as 'the defendant') for the recovery of a sum of Rs. 5,000/- together with interest and costs. The plaintiff took out a summons for judgment in that suit against the defendant on 16-4-1975. After hearing the parties the learned Judge was pleased to grant conditional leave on the defendant depositing a sum of Rs. 3,500/- on or before 3-7-1975. On the defendant failing to deposit the said amount as per the order, an ex-parte decree was passed against him on 16-10-1975.

3. The Maharashtra Debt Relief Ordinance, 1975, was passed on 27-8-1975. On 20-10-1975 the defendant took out a chamber summons in the Bombay City Civil Court praying that he be given the benefit of the said ordinance and that he be declared as a 'debtor' as defined under the said ordinance. On 19-12-1975 the defendant's chamber summons was dismissed for default of appearance.

4. On 3-1-1976 the Maharashtra Debt Relief Ordinance, 1975 was repealed and the Maharashtra Debt Relief Act, 1975 (Act No. III of 1976) came into force as and from the date.

5. On 15-9-1978 the plaintiff took out a notice under Order XXI Rule 2, Civil Procedure Code for leave to execute the decree passed on 16-10-1975 against the defendant. The defendant opposed the said notice being made absolute and in his affidavit the defendant claimed to be a 'debtor' under the newly passed Maharashtra Debt Relief Act, 1975 (Act No. III of 1976) (hereinafter referred to as 'the said Act') and claimed that the debt was wholly discharged under section 4 of the said Act.

6. The notice came to be heard by His Honour Judge Shri V.K. Joshi, who after hearing both the parties rejected the contentions of the defendant and made the notice under Order XXI, Rule 22 of the Civil Procedure Code absolute. This defendant has now approached this Court in revision against the said order of the learned Judge.

7. The learned Judge rejected the application of the defendant for relief under the Maharashtra Debt Relief Act on two grounds. Firstly, the learned Judge held that the issue whether the defendant was a 'debtor' under the said Act was barred by the principle of res judicata. The learned Judge held that this plea could have been raised by the defendant in the suit itself at the time of the passing of the decree since the Maharashtra Debt Relief Ordinance had come into force on 27-8-1975. Since the defendant had failed to take up such a plea, the issue had become barred by the principle of res judicata. Secondly, the learned Judge was pleased to reject the application of the defendant on the ground that he had already taken up this plea in his chamber summons dated 20-10-1975 and which chamber summons was dismissed for default of appearance on 19-12-1975. The learned Judge, therefore, felt that the defendant was not entitled to raise this plea over again in the execution proceedings.

8. Shri Jaisinghani, the learned Advocate appearing on behalf of the defendant had assailed the judgment of the learned Judge on the ground that the learned Judge had dismissed the application of the defendant without taking into consideration the provisions of the Maharashtra Debt Relief Act. Shri Jaisinghani contended that under section 4 of the said Act every debt of a worker whose immovable property did not exceed Rs. 20,000/- in market value and every debt of any other debtor, outstanding on the appointed day shall be deemed to be wholly discharged and as a consequence no such debt would be recoverable from the debtor. The other consequence was that no Civil Court could entertain any suit or proceedings for the recovery of such debt.

9. Shri Jaisinghani then contended that under section 12 of the said Act if in any suit instituted in a Civil Court any issue which was required to be settled, decided or dealt with by the Authorised Officer, the Civil Court must stay the suit and refer such issues to the Authorised Officer for determination. Section 11 of the said Act barred the jurisdiction of the Civil Court to settle, decide or deal with any question which arose under the said Act.

10. Shri Jaisinghani submitted that the learned Judge had committed an error in rejecting the application of the defendant on the ground that the same was barred on the principles of res judicata. Shri Jaisinghani contended that merely because the first chamber summons taken out by his client was rejected for want of appearance, his client was not debarred from filling a second application.

11. I shall deal with the last submission of Shri Jaisinghani. Shri Jaisinghani submitted that the principles of res judicata under section 11 of the Civil Procedure Code could not apply unless the suit or issue in which the matter directly and substantially in issue had been directly and substantially in issue in a former suit between the same parties, and such an issue had been finally heard and decided by the Court. Section 11 of the code of Civil Procedure lays down :---

'11. Res judicata.

No Court shall try any suit or issue in which the matter directly and substantially in issue had been directly and substantially in issue in a former suit between the same parties, or between parties under whom they or any of them claim, litigating under the same title, in a Court competent to try such subsequent suit or the suit in which such issue has been subsequently raised, and has been heard and finally decided by such Court.'

Shri Jaisinghani also contended that in this case the issue whether the defendant was a 'debtor:' within the meaning of the Maharashtra Debt Relief Act had not been finally decided by the City Civil Court at any time and that being the case the principles of res-judicata or principles analogous to res judicata could not come into operation. Shri Jaisinghani relied on the observations of the Supreme Court in the case of Sheodan Singh v. Daryao Kunwar, reported in : [1966]3SCR300 , wherein the learned Judge had held :---

'Reliance in this connection is placed on the well settled principle that in order that a matter may be said to have been heard and finally decided, the decision in the former suit must have been on the merits. Where, for example, the former suit was dismissed by the trial Court for want of jurisdiction, or for default of plaintiff's appearance, or on the ground of non-joinder of parties or misjoinder of parties or multifariousness, or on the ground that the suit was badly framed, or on the ground of a technical mistake, or for failure on the part of plaintiff to produce probate or letter of administration or succession certificate when the same is required by law to entitle the plaintiff to decree or for failure to furnish security for costs, or on the ground of improper valuation or for failure to pay additional Court fee on a plaint which was under valued or for want of cause of action or on the ground that it is premature and the dismissal is confirmed in appeal (if any) the decision not being on the merits would not be res-judicata in a subsequent suit.'

Similar observations of the Supreme Court are to be found in the case of Pulavarthi Venkata Subha Rao v. Valluri Jaggannadhan Rao, reported in : [1964]2SCR310 and in the case of Shivashankar Prasad Shah v. Baikunth Nath Singh, reported in : [1969]3SCR908 .

12. In the instant case it is not disputed that the chamber summons taken out by the defendant on 20-10-1975 for claiming relief under the Maharashtra Debt Relief Ordinance was dismissed for default of appearance on 19-12-1975. That being the case, the principles of res judicata or even principles analogous to res judicata cannot be applied in the instant case. The learned Judge, therefore, was in error in rejecting the defendant' application on that ground.

13. I shall now deal with the provisions of the Maharashtra Debt Relief Act and the contention of Shri Jaisinghani that under the provisions of the said Act any issue arising under the said Act must be referred to the Authorised Officer for determination.

14. Section 2(f) of the said Act defines a 'debtor' in the following terms :---

'2(f) 'debtor' means a marginal farmer rural artisan, or rural labourer whose total income from all sources did not exceed two thousand and four hundred rupees during the year immediately before the 1st day of August, 1975 and a worker whose total income from all sources did not exceed, if living in an urban area six thousand rupees during the year immediately before the said date and the living elsewhere four thousand and eight hundred rupees during that year'.

Section 2(o) of the said Act defined a 'worker' as :---

'2(o)---'worker' means a person who earns his livelihood through any profession, calling or trade and also a person who is wrong in any factory (including a badli worker therein).'

Section 4 of the said Act provided that every debt of a worker whose immovable property did not exceed twenty thousand rupees in market value and every debt of any other debtor, outstanding on the appointed day, including the amount of interest, if any, should be deemed to be wholly discharged and the consequences of such discharge would be that no such debt could be recoverable from the debtor from or against any moveable or immovable property belonging to him, nor shall any such property be liable to attached or sold in execution of any decree or order relating to such debt against him. The second consequence would be that no Civil Court could entertain any suit or proceeding against such debtor for the recovery of any amount of such debt. The third consequence was that all suits and proceedings (including appeals, revisions, attachment or execution proceedings) pending on the appointed day for the recovery of any such debt shall abate. The fourth consequence was that every debtor undergoing detention in a civil prison in execution of any decree for money passed against him by a Civil Court in respect of any such debt shall be released. And the fifth consequence was that every property pledged or mortgaged by such debtor shall stand released in favour of such debtor, and the creditor shall be bound to return the same to the debtor forthwith on the debtor making an application in writing in that behalf; and the creditor was obliged to pass a receipt to the debtor of having received the application.

15. Section 11 of the said Act laid down that Civil Court would have jurisdiction to settle, decide or deal with any question which was required to be settled, decided or dealt with by the Authorised Officer. Further that no order of the State Government or any officer or authority made under Chapter III of the said Act could be questioned in any Court.

16. Section 12 laid down that if a suit in any Civil Court involved any issues which were required to be settled, decided or dealt with by the Authorised Officer under the Act , the Civil Court shall stay the suit and refer such issues to the Authorised Officer for determination.

17. The issue whether the defendant in these proceeding was or was the 'debtor' or a 'worker' as defined under section 2 of the said Act was the same which was required to be settled under the said Act by the Authorised Officer and that being the case the Civil Court ought to have referred that issue of the Authorised Officer for determination.

18. Reference maybe made to the observations of the Division Bench of this Court in the case of Bhagwah Motiram v. Jayant Shridhar, reported in 1981 Bom.C.R. 319 : 1981 Mh.L.J. 216, wherein the learned Judges were pleased to observed :

'However, if a careful scrutiny of sections 7, 11 and 12 is made, it appears to us to be clear that the scope of section 11 cannot be restricted only to a dispute contemplated by section 4(e). Section 4(e) of the Debt Relief Act no doubt deals with a secured debt because it refers to 'every property pledged or mortgaged by such debtor'. The consequence of section 4(e) is that the pledged or mortgaged property shall stand released in favour of such debtor and the creditor is bound to return the same to the debtor forthwith on the debtor making an application in writing. Now if we read section 11 of the Debt Relief Act, it is clear that section 11 does not refer to any particular proceeding in which the Authorised Officer is to decide the question referred to in that section. Section 11 refers to 'any question which is required to be settled, decided or dealt with by the Authorised Officer' .....Therefore, wherever questions of the nature referred to in section 7(1) and (6)' are raised before the Civil Court, the provisions of sections 11 and 12 of the Debt Relief Act will be attracted and the jurisdiction of the Civil Court to decide those questions is ousted by section 11 and unless a reference is made to the Authorised Officer by the Civil Court for adjudication of those questions and the decision of the Authorised Officer is communicated to the Civil Court, the Civil Court is incompetent to proceed to decide the suit if the decision of those questions is necessary for the decision of the suit.'

19. In view of the provisions of sections 7, 11 an 12 the question whether a person claiming to be a trader is or is not a 'Worker' is to be decided by the Authorised Officer specified therein. Ordinarily these matters are to be decided by the Authorised Officer in view of the provisions of section 11 read with section 12 of the said Act because the jurisdiction of the Civil Court is expressly barred with regard to any question which is required to be decided, dealt with or determined by the Authorised Officer. In my opinion the learned Judge ought to have referred the question whether the defendant in the suit was or was not a 'worker' within the definition provided in section 2 of the said Act, to the Authorised Officer for determination. In view of this conclusion, I refer this question to the Authorised Officer for his determination. After the questions decided by the Authorised Officer, who in this case is the Collector of Bombay, the City Civil Court will proceed with the notice taken out by the plaintiff under Order XXI, Rule 22, C.P.C.

20. In the result, the rule is made absolute. The order of the learned Judge, Bombay City Civil Court, is set aside. The issue whether the defendant is or is not a 'worker' within the meaning of section 2(0) of the said Act is referred to the Authorised Officer for determination. After the matter is so determined, the City Civil Court will deal with and dispose of the plaintiff's notice under Order XXI, Rule 22, C.P.C. There will be no order as to costs of this revision application.


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