C.S. Dharmadhikari, J.
1. Writ Petition No. 700 of 1977 has been filed by the petitioners for themselves, individually as well as on behalf of other money lenders. While admitting the petitions this Court granted leave under Order 1, Rule 8 of the Civil Procedure Code and, therefore, it could be said that the said writ petition was filed in a representative capacity. In this writ petition as well as other writ petitions which were heard with Writ Petition No. 700 of 1977, the petitioners have challenged the provisions of the Maharashtra Debt Reliefs Act, 1975 as enacted in the year 1975 as well as amended by Maharashtra Act XL of 1977 and Maharashtra Act XVIII of 1979. The various provisions of this Act are challenged mainly on the ground that they are violative of the petitioners' fundamental rights guaranteed under Articles 14 and 19(1)(f) and (g) of the Constitution of India. According to the petitioners when the matter was heard by this Court on an earlier occasions in Kailashchand Khusalchand Bakliwal v. State of Maharashtra, 79 Bom.L.R. 449 or by the Supreme Court in M/s. Fatehchand Himmatlal and others v. State of Maharashtra, : 2SCR828 , in view of the promulgation of the emergency and the consequential suspension of these fundamental rights, the petitioners had no right to challenge the various provisions of the Debt Reliefs Act on this Count. Therefore, in substance in these writ petitions we are concerned with the question whether the various provisions of the Act No. III of 1976 (hereinafter referred to as the Debt Reliefs Act) are violative of the petitioners' fundamental rights guaranteed under Articles 14 and 19(1)(g) of the Constitution of India.
2. In Writ Petition No. 700 of 1977 it is contended by the petitioners that the various provisions of the Debt Reliefs Act are violative of the petitioners' fundamental rights guaranteed under Articles 14 and 19(1)(f) and (g) of the Constitution of India because they impose unreasonable restrictions on the petitioner's fundamental rights guaranteed under the Constitution of India to carry on trade, business or profession as a money lender and the said provisions are also violative of Article 14 of the Constitution of India being arbitrary without having a reasonable nexus with the object sought to be achieved. In para 10-A of the petition, the petitioners have contended that at the relevant time the petitioners had about 145 customers, whom they had advanced loan and out of them 125 were not from the neighbourhood in which the shop of the petitioners is situated. Out of these 145 customers 112 had come for the first time, 43 for the second time and 13 for more than twice. About 140 customers do not belong to the category of rural debtors. These 145 customers includes lawyers, Government servants and traders. According to them none of the petitioners were prosecuted for not complying with the provisions of the Bombay Money Lenders Act, nor any complaint was filed against them to any of the authorities. It is their case that as they advanced loan on the basis of the pledge articles or sureties and as all the customers are not residents of the neighbourhood they have no knowledge about their whereabouts and financial position. In the petition it is also alleged that the petitioners have never visited the place of their debtors at any time nor do they ever know their financial condition or extent of assets or their liabilities. The petitioners have never visited the place of their debtors at any time nor do they ever know their financial condition or extent of assets or their liabilities. The petitioners have never approached personally the customers and it is the customer who seek loan from the petitioners. It is the case of the petitioners that they cannot be termed as unscrupulous creditors but are bona fide money lenders carrying on their business of money lending. The petitioners further contended that the various provisions of the Act have no nexus with the object sought to be achieved and the various definitions including the definition of 'debtor' and 'worker' are wholly arbitrary. The petitioners further contended that the section 48 which bars representation through a legal practitioner is also wholly arbitrary, because it denies the petitioners a reasonable opportunity to put forward their case effectively before the authorities concerned. It is also contended by the petitioners that the provisions of sections 58 and 60 which grants exemption in favour of the various categories of institutions who also carry on business of money lending are also arbitrary because though the petitioners who are individual money lenders and the categories of money lenders referred to in sections 58 and 60 belong to the same class of money lenders a preferential treatment is meted out to the by granting exemption, which is violative of the petitioner's fundamental right guaranteed under Article 14 of the Constitution of India. Shri Shah who led arguments on behalf of the petitioners has contended before us that the various provisions of the Debt Reliefs Act in substance destroy the petitioners' fundamental right to carry on business. Further persons who have capacity to pay the debts are treated on par with the persons who are not in position to repay the debt. By following the uniform pattern these two classes have been treated equally though they do not belong to the same class. It is also contended by Mr. Shah that the definition of word 'worker' is wholly unreasonable and the said definition travels beyond the object of the legislature. It is also contended by Shri Shah that the provisions of the newly added Chapter V-A of the Act are also violative of the petitioners' fundamental rights guaranteed under Articles 14, 19(1)(f) and (g) of the Constitution of India. According to Shri Shah the period of one year chosen while defining the term 'debtor' for ascertaining his income in wholly arbitrary and fanciful and does not reflect the real financial position of the person. In a given case because of the natural calamity or otherwise the annual income for a year immediately before the appointed date may be meagre though for the earlier several years as well as the for subsequent years he might be making good fortune. Therefore, in substance it is contended by Shri Shah that laying down a period of one year for ascertaining the income of the debtor is wholly unreasonable and arbitrary and has no nexus with the object sought to be achieved. Shri Shah then contended that so far as 'worker' is concerned his only immovable property is taken into consideration for valuation of his property and the moveable property is wholly excluded from consideration. A person's financial position depends upon not only on the immovable assets but also moveable property in his possession and, therefore, the legislature has arbitrarily acted in excluded from consideration the moveable property of the worker while ascertaining his financial position. Therefore, Shri Shah contended that the said provision is wholly arbitrary, unreasonable and has no nexus with the object sought to be achieved. According to Shri shah the term 'worker' as defined by the Act might include in its import doctors or lawyers, whose income might have been less than Rs. 6000/- in the year preceding the appointed date. Thus the date chosen or the year selected for ascertainment of the financial position or income being wholly arbitrary, the said provision is violative of the petitioners' fundamental rights incorporated in Articles 14 and 19 of the Constitution of India. This is more so because the legislature wholly ignores the purpose for which the loan is taken. According to the learned Counsel if the legislature intended to confer a right upon the weak section of the society who are really unable to repay the debts, then the purpose for which the loan is taken as well as average income of the debtor spread over at least 3 years should have been taken into consideration. In a given case a possibility cannot be ruled out that the debtor might have borrowed money for purchasing equipment etc. so as to carry on his own business. Many times it so happens, particularly in rural areas and in the families of working classes that there are more than one earning members in a family. These family members live together and the income is also pooled together. In these circumstances the income of all the members of the family should have been taken into consideration for deciding paying capacity. Further there are in the field other enactments including the Bombay Money Lenders Act and the provisions of these enactments are sufficiently drastic and a person cannot a get a decree in a Court of law unless various provisions of these Acts are satisfied. In these circumstances the legislature should not have included the decree of the Court while defining the terms 'debtor'. According to the learned Counsel the petitioners are not against this socio-economic measure but the way it has been done is wholly arbitrary and the said provision is wholly destructive of their fundamental right to carry on their business, and imposes unreasonable restrictions and is also discriminatory. Therefore, according to the learned Counsel this enactment as a whole should be declared ultra vires of Articles 14 and 19(1)(f) and (g) of the Constitution of India.
3. So far as the newly added Chapter V-A is concerned, it is contended by Shri Shah that by the earlier provisions the earlier debts are wholly wiped out and in the year 1979 again this chapter is added depriving the petitioners-money lenders of their legitimate right to recover the amount of loan in lump sum. This whole chapter imposes an unreasonable restriction upon the fundamental rights of the petitioners. The provisions made in this chapter are also arbitrary and according to the learned Counsel the whole enactment is enacted only to achieve a cheap popularity. Shri Shah has also contended that if a person has enough money or property from which he can repay the loan in lump sum, then the provisions made in sections 9 and 40 of the Act for scaling down the debt is wholly unreasonable. Further the percentage of scaling down is also arbitrary and it has no reasonable nexus with the object sought to be achieved. The rate of interest provided is also wholly illusory. On the top of it, though various provisions of the Act and the procedure laid down and prescribed involve determination of serious and complicated questions of law and facts, by section 48 of the Act, the legal practitioners are excluded from appearing before the authorities which in substance amount to denial of giving reasonable opportunity to the petitioners to put forward their case. Therefore, according to the learned Counsel, apart from laying down various arbitrary and fanciful restrictions, which has no nexus with the object sought to be achieved, the whole enactment is so drafted so as to completely destroy the petitioner's right to carry on trade, business or profession of money lending and as these provisions are not severable, the whole enactment is liable to be declared as ultra vires of said fundamental rights of the petitioners.
4. Shri Kapadia and Shri Bora, the learned Counsel appearing for the petitioners in other writ petition adopted the argument advanced by Mr. Shah.
5. Shri Sawant, the learned Additional Government Pleader contended before us that various challenges now sought to be raised by the petitioners in these petitions are already answered by this Court in Kailashchand's case as well as by the Supreme Court in Fatehchand's case. The said contention also do not survive in view of the subsequent decision of the Supreme Court in : 2SCR537 , Pathumma and others. v. State of Kerala and others. Shri Sawant has further contended that it is no doubt true that in Kailashchand's case this Court and in Fatehchand's case the Supreme Court has considered the reasonableness of the provisions of the Debt Reliefs Act in the context of Article 301 and Article 304(b) of the Constitution of India but the area and the field covered by Article 304(b) and Articles 19(5) and 19(6) is the same and, therefore, once it is held that the said provisions impose reasonable restrictions in the context of Article 304(b) of the Constitution of India then it will have to be held, that the Supreme Court as well as this Court has already decided that the said restriction are also reasonable even in the Article 19(5) and 19(6) of the Constitution of India as the language used in Articles 304(b) and Articles 19(5) and 19(6) is identical and, therefore, the test and the yardstick is also the same. Shri Sawant further contended that in Kailashchand's case this Court as well as in Fatehchand's case the Supreme Court has held that money lending is not a trade within the contemplation of Article 301 of the Constitution of India. This being the position it is further contended by Shri Sawant that by necessary implication it will have to be held that money lending is not a fundamental right at all which is guaranteed by Article 19(1)(g) of the Constitution of India. Shri Sawant has then contended that the object of the legislature is to eradicate indebtedness of the weaker section of the society and the various provisions of the Act have been enacted to achieve the said object. These provisions have been made in the public interest to held the weaker sections of the society. The provisions made in the public interest to held the weaker sections of the society. The provisions made are in conformity with the directive principle of the State policy incorporated in Articles 38, 39 and 46 of the Constitution of India. Though the directive principle incorporated in Chapter IV are not enforceable in a Court of law, any legislation made for achieving the said object of in furtherance of the directive principles of the said State Policy will amount to reasonable restrictions on the fundamental rights of the citizens, within the meaning of the Clauses (5) and (6) of Article 19 of the Constitution of India. So far as the various provisions of the enactment are concerned it is contended by Shri Sawant that the said provisions of the Act are not arbitrary and the period chosen and classification made is also reasonable and has a nexus with the object sought to be achieved namely, eradication of indebtedness of the weaker sections of the society. So far as the bar imposed under section 48, relating to the exclusion from appearance of the legal practitioners is concerned, it is contended by Shri Sawant that the said provision is reasonable and does not affect the petitioners' fundamental rights under the Constitution of India. Nor it is contrary to the principle of natural justice or fair play. The legal practitioners have a right to carry on their profession subject to the provisions of law and in the matters of appearance through a legal practitioner nobody can claim an absolute right. Moreso there is no absolute prohibition or bar under section 48 so far as the legal practitioners are concerned, because the power is given to the Court for the reasons to be recorded in writing to allow the parties to be represented by the legal practitioners. Further in the proceedings contemplated by sections 35, 38 and 44 a person is entitled to appear through a legal practitioner and, therefore, according to Shri Sawant the said provisions is also wholly reasonable and cannot be terms as arbitrary.
6. Shri Radhakrishan the learned Counsel appearing in Special Civil Application No. 700 of 1977 adopted the arguments advanced by Shri Sawant and has contended that the various provisions of the enactment only impose reasonable restrictions upon the petitioners and, therefore, these restrictions are covered by Clauses (5) and (6) of Article 19 of the Constitution of India. He also contended that none of these provisions are either arbitrary or fanciful and have been enacted to achieve the object of the legislation.
7. Since the Maharashtra Debt Reliefs Act was already the subject matter of the challenge before this Court in Kailashchand's case as well as before the Supreme Court in Fatehchand's case, it will be worthwhile if a reference is made to the said decisions to find out as to what this Court as well as the Supreme Court, have already held. Since many of the challenges advanced before us are already covered by these two decisions, it is not necessary for us to make any detailed reference to these challenges over again as well as to the finding recorded in that behalf. It is no doubt true that on earlier occasions the main challenge to the enactment was based on the provision of Article 301 of the Constitution of India. However, it cannot be forgotten that while considering the said challenge, this Court as well as the Supreme Court considered the reasonableness of the restrictions particularly in the context of Article 304(b) of the Constitution of India.
8. It will be also worthwhile to note that the phraseology used in Clauses (5) and (6) of Article 19 of the Constitution of India is also similar to one used in Articles 302 and 304(b) of the Constitution of India.
9. The right conferred upon a citizen under Article 19(1)(g) is obviously subject to the reasonable restrictions contemplated by Clause (6) of Article 19 of the Constitution. Shri Sawant the learned Counsel appearing for the respondents has rightly placed reliance upon a decision of the Supreme Court of Indian in M/s. Vrailal Manilal & Co. and another v. State of Madhya Pradesh & others, : 1SCR400 and particularly upon the following observations in para 10 thereof :
'10. That being so their restrictions on their transport contained in section 5 cannot be held to be the integral part of the trade monopoly but as ancillary or incidental thereto, made for its effective enforcement. If that be so, it affects the right of the purchaser under Article 19(1)(f) to hold and to dispose of the goods he has acquired, a right which is not co-related, as the right under Clause (g), it, with the monopoly which the section seeks to create. It follows, therefore, that such a provisions would have to pass the test of reasonableness under Clause (5) and the first part of Clause (6) of Article 19. That would also be the position respect of Article 304(b). But since the requirement of these provisions is the same yardstick of reasonableness would be common to all these cases. It is well recognised that when an enactment is found to infringe any of the fundamental rights guaranteed under Article 19(1), it must be held to be invalid unless those who support it can bring it under the protective provisions of Clause (5) or Clause (6) of that Article'.
Thus in substance it is held by the Supreme Court that the requirement of Article 304(b) and that of Clause (6) of Article 19 is the same and, therefore, yardstick of reasonableness is also common to all these cases. Therefore, if the Supreme Court while considering the reasonableness of these restrictions, though under Article 304(b) of the Constitution has come to the conclusion that these various restrictions are reasonable restrictions in public interest, then same yardstick should apply qua test of reasonableness under Clauses (5) and (6) of Article 19 of the Constitution.
10. This is not the end of the matter. In the subsequent decision namely in Pathumma's case a similar enactment came for consideration before the Supreme Court and the Supreme Court had an occasion to consider the challenged based on Articles 14 and 19 of the Constitution. After making a detailed reference to Fatehchand's case and the reports of the various committee in para 33 of the said judgment Pathumma's case the Supreme Court observed as under :
'33. Having regard to the history of economic legislation in Kerala, the sad plight of the agriculturist debtors in the State and the fact that the agriculturist debtors are living from hand to mouth and below subsistence level, the observations made by this Court as quoted above apply to the facts of the present case with full force because similar conditions had prevailed in Maharashtra which led to the passing of the Maharashtra Debt Reliefs Act.'
In this very context in para 38 of the Supreme Court further held that :
'38. Another object which is said to be fulfilled by the statue is to eradicate and remove agricultural indebtedness in the State by amelioration and improvement of the lot of debtors by bringing them to the subsistence level and reducing their borrowings. The Act does not provide for any drastic or arbitrary procedure as the property is restored to the debtor only on payment of the purchase money. The Maharashtra Debt Reliefs Act of 1976 contained much more drastic provisions and in spite of that it was upheld by this Court as the restriction were held by us to be reasonable restrictions in the interest of the general public. To remove poverty by eradicating rural indebtedness is one of the very important social purposes sought to be achieved by out Constitution and it cannot be said that the invasion of the right of the appellants is so excessive as to be branded by the quality of unreasonableness.'
In the earlier decision i.e., in Fatehchand's case the Supreme Court had an occasions to consider various provisions of the impugned enactment. After making a detailed reference to the aims and objects, as well as the various reports in the field in para 38 the Supreme Court has observed as under :
'38. A meaningful, yet minimal analysis of the Debt Act, read in the light of the times and circumstances which compelled its enactment, will bring out the human setting of the statute. The bulk of the beneficiaries are rural indigents and the rest urban workers. These are weaker sections for whom constitutional concern is shown because institutional credit instrumentalities have ignored them. Money lending may be ancillary to commercial activity and benignant in its effects but, money lending may also be ghastly when it facilities no flow of trade, no movement of commerce, no promotion of intercourse, no servicing of business, but merely stagnates rural economy, strangulates the borrowing community and turns malignant in its repercussions. The former may surely be trade, but the latter-the law may well say-is not trade. In this view we are mere inclined to the view that this narrow, deleterious pattern of money lending cannot be classed as 'trade'. No other question then arises since the petitioners and appellants cannot summon Article 301 to their service.'
Then in subsequent paras the Supreme Court proceeded to consider the question of reasonableness of the restrictions on the assumption that the money lending is a trade, and has ultimately found that various restrictions imposed are reasonable and regulatory. In view of these two decisions of the Supreme Court as well as the decision of this Court in Kailashchand's case, it is not necessary for us to make a detailed reference to various other decisions cited at the bar.
11. So far as the challenge to sections 58 and 60 is concerned, this is what the Supreme Court has observed in para 41 of the Fatehchand's case '
'41. There is no merit in the plea. Liabilities due to Government or local authorities are not tainted with exploitation of the debtor. Likewise debts due to banking companies do not ordinarily suffer from overreaching, unscrupulousness or harsh treatment. Moreover financial institution have, until recently, treated the village and urban worker and petty farmer as untouchables and so do not figure in the picture. To exempt the categories above referred to is reasonable.'
In this context a reference could also be made to subsequent decision of the Supreme Court in Srinivas Enterprises and others v. Union of India & etc., : 1SCR801 . In the said decisions the Supreme Court had an occasion to consider the provisions of Prize Chits and Money Circulating Schemes (Banning) Act, (43 of 1978). An argument was advanced therein that exemption granted in favour of the Government and Banking Companies etc. is violative of the petitioner's fundamental rights guaranteed under Article 14 of the Constitution. Repelling this contention the Supreme Court has observed as under:
'A bare reading of that provision makes it clear that the exempted categories do not possess the vices of private prize chits. For one thing, what are exempted are prize chits and money circulation schemes promoted by or controlled by the State Government, the Central Government or the State Bank of India or the Reserve Bank. Even Rural Banks and Co-operatives covered by section 11, are subject to public control..... Likewise, charitable and educational institutions are exempted only if they are notified by the State Government in consultation with the Reserve Bank. There are enough arguments to justify the different classification of these items and their exemption cannot be called in question on the ground of violation of Article 14. Reasonable classification wins absolution from the charge of discrimination if the differential has a nexus with the statutory object.'
What is exempted by section 58 and section 60 is debt due to Government, local authorities, Banking companies, State Bank of India, Subsidiary Banks, New Banks constituted under the Banking Companies, Corporations owned and controlled by the State and Co-operative societies etc. It is clear from the preamble of the Act that Government wanted to protect the weaker section of the society from the unscrupulous money lenders. This class of the society does not belong to the class of institutions or persons specified in sections 58 and 60 of the Act. It cannot be said that the institutions or persons specified in sections 58 and/or 60 belong to the same class of money lenders. In these circumstances, in our opinion it cannot be said that the exemption granted in favour of these institutions or persons is in any way arbitrary or unreasonable.
12. So far as the contention raised by Shri Shah based on section 48 of the Act, providing for exclusion of legal practitioners for appearance, is concerned, it is also without any substance. Section 48 does not create any absolute bar from appearance so far as the legal practitioners are concerned. In section 48 it is laid down that except in proceedings under sections 35, 38 and 44, no legal practitioners shall be entitled to appear on behalf of any party in any proceedings before the lower Court or the Court in appeal, under the chapter V-A. Then by proviso it is provided that in the interest of justice for the reasons to be recorded in writing Court may allow the parties to be represented at their own costs by a legal practitioner. Thus the section does not create any absolute bar in this behalf. A discretion is conferred upon the Court to allow the parties to be represented by a legal practitioner if the Court finds that in the interest of justice for the reasons to be recorded in writing such a permission should be granted. This exclusion is contemplated qua both the parties i.e. debtor as well as creditor. It is well settled that nobody has got an absolute right so far as the representation by the legal practitioner is concerned. The Division Bench of this Court had an occasion to consider somewhat similar challenge in Special Civil Applications Nos. 853 of 1973, 1387 of 1973 and 2463 of 1972 decided on 2nd August, 1973 in the context of validity of sub-section (4) of section 36 of the Industrial Disputes Act, 1947. After making a reference to the earlier decisions of this Court in Mulchand v. Mukund, : AIR1952Bom296 as well as to the decision of the Madras High Court in 1954 Mad. 553 A.N. Rangaswamy & another v. The Industrial Tribunal, this Court came to the conclusion that the said provision is not violative of the provisions of Articles 14 or 19(1)(g) of the Constitution. Similar view is taken by this Court in V.U. Uttarwar v. State, : AIR1977Bom99 . Therefore, it is not possible for us to accept the contention raised by Shri Shah in this behalf.
13. So far as the contention raised by Shri Shah i.e., that, though the loans given to the debtors are wiped out or scaled down, no provision is made in the Act for consequential calling down of the debt which the money lender had to incur for advancing loan to the debtors, is concerned, the said challenge also does not survive in view of the finding recorded by the Supreme Court in Fatehchand's case in para 45 of the judgment. In the said para the Supreme Court had also considered the definitional deficiency in ignoring the moveable wealth of debtors while ascertaining his financial capacity. While dealing with this aspect of the matter the Supreme Court observed as under :
'45. In this perspective, we see no constitutional flaw in the Act on the score that the sheep have not been divided from the goats. Realism in the legislature is a component reasonableness. It was urged by Shri Chitale that the definitional deficiency in ignoring the movable wealth of debtors makes the scheme arbitrary and unreasonable. A romantic view of the debtors being considerable owners of costly art pieces and sophisticated gadgets and yet eligible for relief is good rhetoric but unrealistic. A pathetic picture of the money lender being deprived of his loan assets while being forced to repay his lender was drawn but that cannot affect the reasonableness of the relief to the grass-roots borrower. Nor is it valid to attack the Act on the scare that the whole debt i.e. the very capital of the business, has been dissolved. More often than not, the money lender would have over the long lived debts and repeated renewals, realized more than the principal if economic studies tell the tale truly. The injustice of today is often the hang over of the injustice of yesterday, as spelt out by history. The business of money lending has not been prohibited. The Act is a temporary measure limited to grimy level of society. Existing debts of same classes of indigents alone have been liquidated. If impossible burdens on huge human numbers are not lifted, social order lines will be threatened and as a regulatory measure this limited step has been taken by the legislature. Regulation if the situation is necessitous, may reach the limit of prohibition. Disorder may break out if the law does not set in to grant some relief. Trade cannot flourish where social order lines is not secure. If the tensions and unrests and violence spawned by the desperation of debtors are not dissolved by State action, no money lending trade can survive. It follows that for the very survival of trade the regulatory measure of relief of indebtedness is required. What form this relief should take is ordinarily for the legislature to decide. It is not ordinarily for the Court to play the role of Economic Adviser to the Administration. Here ameliorator measures have been laid down by the legislature so that the socio-economic scene may become more contended, just and orderly. Obviously, this is regulatory in the interest of Trade itself. This policy decision of the house cannot be struck down as perverse by the Court. The restrictions under the Debt Act are reasonable. Equally clearly, if the steps of liquidation of current debts and moratorium are regulatory, Article 301 does not hit them'.
Apart from this it cannot be forgotten that the Legislation is meant for the debtors who belong to the economically weaker section of the society and not to affluent class. As observed by the Supreme Court such persons are not expected to have movables worth the name, therefore, exclusion of the movables from consideration cannot be termed as arbitrary or unreasonable.
14. Another contention raised by Shri Shah i.e. that while ascertaining the financial position of the debtor, the income of the other earning members of the family should also be taken into consideration, is also duly considered and dealt with by this Court in Kailaschand's case. This Court has observed that whether other members of the family had any capacity to pay or not was hardly relevant because there would be no legal obligation on any of them to pay the debt of the persons who had borrowed.
15. Similarly the contention one year's period referred to in the definition is arbitrary, also came for consideration of this Court in Kailaschand's case. In this context the Division Bench of this Court has observed as under :
'Now, the original Ordinance came into force on August 2, 1975. The Legislature had to prescribed some period, the income during which could be taken as a criterion for determining whether the debtor would be entitled to take the benefit of this Act. If the beginning of the month in which the Ordinance was promulgated is taken as a starting point and period counted backwards, the income during the preceding year has been adopted as the qualifying criterion, we fail to see why such a criterion can be called an arbitrary criterion. That there is a uniform period for the determination of the qualifying condition whether the debtor is a marginal farmer, rural artisan, rural labourer or a worker itself shows that irrespective of the accounting years being different, a uniform pattern has been applied in respect of the debtors covered by the Act. There was, therefore, nothing wring in making applicable a uniform pattern of the year during which the income had to be determined'.
16. Apart from this as held by the Supreme Court in D. Gr. Gouse and Co. Pvt. Ltd. v. State of Kerala : 1SCR804 , the choice of the date and period for classification cannot be dubbed as arbitrary. In this context the Supreme Court quoted with approval the following observations from the Union of India v. M/s. Parameshwaran Match works etc. : 1978(2)ELT436(SC) :
'The choice of a date as a basis for classification cannot always be dubbed as arbitrary even if no particular reason is forthcoming for the choice unless it is shown to be Capricious or whimsical in the circumstances. When it is seen that a line or a point there must be and there is no mathematical or logical way of fixing it precisely, the decision of the legislature or its delegate must be accepted unless we can say that it is very wide of the reasonable mark.'
17. Having regard to the object of the legislature and the fact that the ordinance was issued on 22nd August, 1975, it cannot be said that the legislature has acted arbitrarily in prescribing 1st of August, 1975 as the date for deciding the income of the debtor during the year immediately before that date. If the ordinance was issued in August, 1975, then selection of 1st day of that month could very well be termed as reasonable which has a nexus to the object sought to be achieved by the enactment. By this enactment the legislature wanted to give protection to the debtors belonging to the economically weaker section of the society. Many times persons belonging to this class are born with debt, they live with these debt and also die with it, leaving nothing but debts for the progeny. In this case we are dealing with the persons who are poor and can hardly have any savings. Therefore, it cannot be said that taking into consideration the income of one year immediately before the 1st of August, 1975 is wholly arbitrary. It is not possible for us to hold that the choice of one year is capricious and whimsical in the circumstances. As a matter of fact for deciding debtor's capacity to pay the debt, the annual income of that year lone is relevant. The principle of average income spread over a certain years may not apply in case of such economically weaker section as much variation in the annual income is not expected. These ignorant and illiterate persons are not expected to maintain accounts of income and expenditure. In such cases the ascertainment of average income will involve unnecessary and endless inquiry, which might defeat the very object of the legislation. In any case if the legislature thought it fit to lay down a period of one year for this purpose, it is not possible for us to hold that the said period is either capricious or whimsical and has no nexus with the object sought to be achieved. Classification on the basis of the income is a well know classification and, therefore, it cannot be said that the classification based on income for one year is either arbitrary or has no nexus with the object sought to be achieved.
18. It was the contended by Shri Shah that the definitions of terms 'worker' and 'debtor' in sections 2(f) and 2(o) as well as in Chapter VA of the Act, are wholly unreasonable. Shri Shah has also challenged the definition of 'worker' on the ground that it is vague and might also include in its import professionals like Doctors and Lawyers. Further the said definitions do not take into consideration the fact that the debtor could have borrowed money for equipments etc. that is for carrying on his own business. According to the learned Counsel the said definition read with section 4 is destructive of the petitioners fundamental right guaranteed under Article 19(1)(g) of the Constitution. He has also contended that the newly added Chapter VA is wholly unreasonable. According to the learned Counsel by the earlier provisions of the Act, earlier debts were wholly wiped out and having done so, again in the year 1979 this Chapter is added by the legislature depriving the petitioners of their legitimate right of recovering the loan amount in lump sum, hence the provisions made therein are wholly arbitrary and have no nexus with the object sought to be achieved.
19. Once it is held that the State Legislature is competent to make law with respect to the matters covered by the legislation, then it cannot be disputed that the said legislature has power to lay down its own definitions regarding the various terms used in the Act.
In most of the modern Acts of the legislature, there is an interpretation clause or a definition clause enacting that words or phrases when found in the Act are to be understood as regards that Act in certain sense or are to include certain things which but for such definition clause they would not normally include. In other words as part of its legislative function legislature may enact law and define its meaning. Normally the definition in a statute or enactment are provided in order to give some artificial meaning to the words or phrases used in the Act. Normally whenever a legislature wants either to expand or to restrict normal connotation of the words the said term is defined in the Act. Thus it is well within the competence of the legislature to define any term or phrase by having down its own definition, which may in a given case be also artificial definition. Once it is held that the State Legislature has power to legislate on the topic then it cannot be said that the State Legislature has no power to lay down its own definitions regarding various terms used in the Act. The term debt is defined by section 2(e) and by section 2(f) the legislature has defined the phrase 'debtor' which means marginal farmer, rural artisans or rural labourers whose total income from all sources did not exceed the amount specified in the section during the relevant year if living in an urban and rural area. So far as the worker is concerned a limit of Rs. 6,000/- is laid down if he is living in urban area and Rs. 4800/- if he is living elsewhere. Then the legislature has also defined the term marginal farmer, rural area, rural artisans, small farmer, urban area, worker etc. Therefore, in substance nothing is left vague by the legislature.
20. The contention that the term 'worker' may include in its import the professionals like lawyers and/or debtors is wholly hypothetical and at this stage we are not called upon to interpret the said clause. Even if it is assumed that it might include in its import such professionals on that count only it cannot be said that the artificial definition is beyond the competence of the legislature. In Chapter VA practically same definitions have been adopted with variations as to the income. The challenge to this definitions is based on Article 14 i.e. that the definitions are arbitrary and have no nexus with the object sought to be achieved. It is not necessary for us to consider this aspect of the matter in detail in view of the decisions of the Supreme Court in Fatehchand's case and Pathumma's case as well as the decision of this Court in Kailashchand's case. In Pathumma's case after making a reference to Fatehchand's case, in paras 29 to 38 the Supreme Court has made a detailed references to the historical background as well as to various reports in the field. Then in para 38 of the judgment the Supreme Court has held that the object sought to be achieved by the legislature is to eradicate and remove the agricultural indebtedness in the State by amelioration and improvement of the lot of the debtors by bringing them to subsistence level and reducing their borrowings. Earlier in para 37 the Supreme Court held that the avowed object of the Act seems to give substantial relief to the agriculturist debtors in order to get back the livelihood. This is undoubtedly a laudable object and the Act is a piece of social legislation. While considering the question as to the reasonableness of restrictions in Pathumma's case the Supreme Court held that one of the tests, is that in judging the reasonableness of restrictions imposed, the Court has to bear in mind the directive principles of the State policy. The Supreme Court also held that the object of the Act is to eradicate rural indebtedness and thereby to secure common good of the people living in object of poverty. The object, therefore, clearly fulfils the directives laid down in Articles 38 and 39(b) of the Constitution. To remove poverty by eradicating the rural indebtedness is one of the important social purpose sought to be achieved by the Constitution and it cannot be said that the invasion of the right of the Money Lenders is so excessive as to be branded by the quality of unreasonableness. Thus the Supreme Court further found that the provisions of the Act were reasonable restrictions within the meaning of Clause (6) of Article 19. While testing the challenge based on Article 14 of the Constitution, the Supreme Court had laid down guidelines as to how the said challenge is to be tested and has then come to the conclusion that having regard to the poverty and economic backwardness of the debtors and miserable conditions in which they live, it cannot be said that if they are treated as a separate category or class for preferential treatment in public interest then the said classification is unreasonable. In this view of the matter it cannot be said that any of these provisions are unreasonable or arbitrary. Similar views seems to have taking by the Andhra Pradesh High Court in Krishan Murthy and others v. Government of Andhra Pradesh : AIR1979AP85 Madha Singh v. The State of Bihar and others : AIR1978Pat172 . and Ramkishan Agarwal and another v. The Collector, Jabalpur and others, : AIR1977MP21 .
21. It is no doubt true that Chapter VA is added subsequently in the year 1979, but as already observed the legislature has practically adopted the same definitions with certain modifications, for the purpose of this chapter also. It appears from the aims and objects of the enactment i.e. Maharashtra Act 18 of 1979 that initially the Maharashtra Debt Reliefs Act, 1975 was enacted for liquidation of debts of certain marginal farmers, rural artisans, rural labourers and workers. It also provides for a moratorium on debt of worker who had immovable property, the market value of which does not exceed the amount specified therein. The Clause 2 of the statement of objects and reasons reads as under :
'2. When this legislation was undertaken, the Government had under consideration legislative measures for scaling down the debts, on the lines of certain well define norms on the subject. It is now proposed to undertake the necessary legislation for adjustment of debts. The life of the Maharashtra Debt Relief Act, 1975, is due to expire on the 22nd August, 1979. As the proposed legislation is supplementary to the measures contained in the Debt Relief Act, it is proposed to expand the scope of that Act, to make the provisions of the Act permanent, except the provisions relating to moratorium, which alone are of a temporary nature, and to insert the provisions relating to adjustment of debts as a separate Chapter VA. The provisions of the new chapter are on the lines of the provisions found in the Debtor's Relief Act, which were enacted in the past for difference parts of the State.'
Thus it is quite clear from the bare reading of Chapter VA that the provisions made therein are not so drastic as that of section 4 of the Act which deals with the discharge of the debts and consequences thereof. If drastic provisions contained in earlier chapters have been held by the Supreme Court to be reasonable, then by no stretch of imagination it can be held that the provisions of Chapter VA are not reasonable. The provisions of Chapter VA deal with the adjustment of debts of certain farmers and workers. By section 59 it is made clear that the debts adjusted under any other laws are not to be further adjusted under this chapter. Therefore, the area and the field covered by the Chapter VA is not wholly unknown. Other provisions are procedural or consequential in nature. It was contended by Shri Shah that by section 7 and section 24 of the Act an obligation is cast upon the creditor to file an application. He has contended that the petitioners do not know all there creditors and a they are advancing loans against securities it is also not necessary for them to know all of them. In these circumstances the burden cast upon the creditor is wholly unreasonable. It is not possible for us to accept this contention also.
22. So far as section 24 is concerned, any debtor or his creditor can file an application to the Court for adjustment of debts. So far as section 7 is concerned the burden is cast upon the creditor and in our opinion rightly. It cannot be forgotten that the debtor upon whom the legislature wanted to confer protection are persons who belong to the weaker section of the society. They are not only proof but also ignorant and illiterate. In any case it is unreasonable to expect that they will maintain records or accounts or will have necessary information in their possession on the basis of which they could claim relief under the Act. None of them is expected to maintain account. Normally such an information will be available with the creditor. Though not all, most of the creditors and debtors live in the same area. It is rather difficult to believe that without knowing antecedents etc. of the debtor, the Money Lenders will chose to advance money. In these circumstances unless such a provision was made it would have been very difficult, if not impossible, for the legislature to achieve the object sought to be achieved, by the enactment. A person who maintains accounts or is in possession of the information is asked to furnish the necessary information and in our opinion it is not only reasonable but also natural.
23. A contention was also raised before us that the scale provided for reduction or adjustment of the debt is also arbitrary as it does not take into consideration the income of the other members of the family. We have already dealt with such a contention and have made reference to the observations of this Court in Kailaschand's case wherein the Division Bench of this Court has observed, and in our opinion rightly, that the income of other members of the family is not relevant for deciding the capacity of the debtor who is obliged in law to repay the debt, because there would be no legal obligation on any of those members of the family to pay the debts of the person who had borrowed.
24. In this context a reference could usefully be made to the 'Report on an inquiry into indebtedness among the textile workers in Greater Bombay in the context of the Maharashtra Debt Relief, Act, 1975'. This inquiry was conducted by the Ambedkar Institute for Labour Studies in the year 1978 after the decision of the Supreme Court in Fatehchand's case. It is observed in the Report that 'it is common knowledge that the indebtedness in rife among the persons in low income group and especially among those at or below the poverty line (who comprise about 40% of the population of our country) living in rural and/or urban areas. The climax is reached when debts become inevitable even for clearing old debts, rendering elimination of indebtedness a remote or well nigh impossible prospect'. Only a sample survey of indebtedness was carried on by Ambedkar Institute for Labour Studies, Bombay. The survey disclosed ignorance of this beneficient piece of legislation among over two thirds of the sampled workers. The inquiry did not reveal even a single case where the relief was sought or claimed from the creditors or Money Lender on the basis of the enactment. The workers appeared to be completely unaware of the legal moratorium on the recovery of debts. In most of the cases the ignorance of law was the cause of inaction in claiming the benefit under the Act. The report further makes a reference to certain malpractices carried out by the Money Lenders. According to the survey, the Money Lenders, employ tricks by which eligible debtors could be pushed beyond the pale of law or silenced into inaction by holding out threats of legal action in case of non-payment of old debts by the appointed date. The debtors were invited by the creditors to take fresh receipts in respect of old transactions, which were purposely given false dates (subsequent to 22-8-1975) with the intention of pushing the case out of the pale of law. Another malpractice reported in this connection is that some Money Lenders indicate on ordinary chit of paper the name of the worker-debtor, name of article pledged, its weight and the amount paid for it. These chits are not signed by the Money Lenders and are easily lost by concerned workers debtors. Another trick played is to call for the original receipt on the plea that the interest amount would be waived by the Money Lenders and the pledged articles returned to the concerned debtor. The original receipt thus acquired are torn in to pieces or burnt and then new receipts bearing a false date subsequent to 22-8-1975 are issued. Some Money Lenders instead of issuing receipts merely record the transactions in their account books which they refused to produce before the debtors on demand. The report further makes a reference to the climate of indecision and frustration in the wake of continuous legal hurdles created by Money Lenders as well as due to non-implementation of the various provisions of law by the concerned authorities. According to the report the hurdles created by the Money Lenders have once again succeeded in effectively thwarting proper implementation of the legislation as a result of which the law stands almost in a condition of suspended animation. We cannot do better but to invite the attention of the authorities concerned towards the findings and recommendations made in this report.
25. It further appears from the said report that in February 1977 Maharashtra Government took a decision to introduce fresh legislation with a view to modify certain provisions of the Maharashtra Debt Reliefs Act, 1975 in pursuance of the suggestions made by Union Government while approving the said Act. The main purpose of this amendment was to scale down substantially the debts of the farmers, rural artisans and workers taken from private Money Lenders in place of the automatic discharge of debts envisaged under the existing law. Thus the new provision is less drastic than the earlier one. As per this report of inquiry into indebtedness, workers in no expenditure group are completely debt free. The report further makes a recommendation for effective legal curbs by Government on clandestine money lending operations by so called friends, relatives and shopkeepers at usurious interest rates since such operations are found to be going on at an incredibly large scale. The report further makes a reference to the observations of the Supreme Court in Fatehchand's case and particularly in paras 71 and 72 thereof which reads as under :
'71. A concluding caveat. The poignant purpose of ending exploitative rural urban lending to the weaker members of the society is the validating virtue of this legislation, viewed from the constitutional angle. But, as Shri Nariman at some stage mentioned and the learned Attorney General also concurred-mere farewell to existing debts is prone to prove a teasing illusion or premise of unreality unless the Administration fills the credit gap by an easy, accessible and need based network of humane credit agencies, coupled with employment opportunities for the small man. The experience of the past has not inspired adequate confidence. Authoritative official pronouncement, however, owns that.
'Arrangements so far made to give credit and inputs (for rural credit) have had only limited impact. The problem is a vast one and seems to be growing in size. Rural banks credit societies, farmer's service societies all these have to be strengthened and their activities expanded. To give purposeful direction to this task and to ensure that the interests of agriculturists and farmers, especially the small farmer, are looked after, there is need for an Apex Agricultural Development Bank in India.'
72. The legislation we upheld is an added responsibility on the State. It shall be vigorously enforced with sympathy for the victim class, lost the progressive measure prove a paper tiger. The cadres charged with enforcement must have right orientation, correct grasp and social activism, if this law is not to leave a yawning implementation gap. Heroics in Court and retraction in the House must be followed by effective enforcement in the field. We state this not because the State is not in great earnest-it is but because many a welfare legislation in the country reportedly remains a cloistered virtue or slumberous in effect. The finest hour of the rule of law is when law disciplines life and matches premise with performance. On this note of hopeful valediction we wind up'.
Therefore, it is clear that economic exploitation and indebtedness is well known chronic disease in the weaker sections of the society. It is recurring. The benefit of the 1975 Act could not be availed of by the debtors for one reason or the other and to borrow the words of the Supreme Court this progressive measure has remained a paper tiger. Therefore, in our opinion it cannot be said that the subsequent provisions made in Chapter VA for the adjustment of the debts, are in any way unreasonable or arbitrary.
In the result, therefore, the Writ petitions Nos. 700 of 1977, 674 of 1977, 777 of 1977, 767 of 1977, O.S. Misc. Petitions Nos. 427 of 1977 and 439 of 1977 are dismissed with costs. The respondents will be entitled to get one set of costs. Hence rule is discharge in all these petitions with one set of costs.
An oral request is made by Shri Shah as well as by Shri Kapadia under Article 134-A of the Constitution for a certificate for appear to the Supreme Court. Since we have decided the matter on the basis of the law laid down by the Supreme Court in Fatehchand's case as well as in Pathumma's case, this is not a fit case wherein such a certificate could be granted, only because a writ petition bearing No. 1811 of 1981 Harakchand v. Bhatia and a review petition bearing No. 19 of 1978 are pending in the Supreme Court. Hence the oral applications made in this behalf are rejected. However, the ad interim stay granted by this Court in these petitions, so far as the petitioners are concerned, is to continue for a period of one month from today.