1. A.S. Nos. 277 and 278 of 1965 are appeals against the decrees in O.S. Nos. 9 and 10 of 1962 on the file of the court of the Subordinate Judge, Anantapur the respective plaintiff in each suit being the appellant in the corresponding appeal. The plaintiff in O.S. No.10/62 . The defendants in the two suits are common. O.S. No.9/62 is laid on a promissory note dated 4-4-1961 (Ex. A-1) executed by late Dhonthi Bhimayya Chetty of Hindpur for a sum of Rs.10,000/- O.S. No.10/62 is laid on a promissory note dated 5-4-61 (Ex. A-5) executed by late Donthi Bhimayya Chetty for a sum of Rs. 10,000/-. The defendants in the two suits are the members of the joint family of which late Donthi Bhimayya Chetty was the manger before he died on 24-11-1961. It is the case of the plaintiffs that late Donthi Bhimayya Chetty borrowed a sum of Rs. 10,000/- in cash from each of the plaintiffs on 4-4-1961 and 5-4-1961, respectively. According to the defendants no amount was borrowed in cash on 4-4-1961 or 5-4-1961. The original debt of which Exs. A-1 and A-5 are renewals was borrowed in 1954 under Ex. B-121. In order to circumvent the provisions of the Agriculturists Relief Act promissory notes used to be taken sometimes in the name of the father i.e., the plaintiff in O.S. No.10 of 1962, sometimes in the name of the son i.e., the plaintiff in O.S.No.9/1962 and sometimes in the name of a partnership, known as Sri Rama Oil Mills, of which the father and son were partners.
The defendants claim that they are agriculturists and that they are entitled to the benefits of the Agriculturists Relief Act. They claim, that the debt should be reopened and traced back to the original debt of 1942. The principal question raised before the lower court and the only question raised before me is whether the defendants are entitled to the benefits of the Agriculturists Relief Act and whether the debts are liable to be reopened and traced back to 1954. The learned Subordinate Judge held that the defendants were entitled to the benefits of Section 13 and 13-A of the Agriculturists Relief Act and that the debts were liable to be reopened and traced back to the year 1954, the date of the Original debt. The learned Subordinate Judge held that the continuity and identity of the debt from 1954 has been established. On those finding the learned Subordinate Judge granted a decree for Rs. 5,704-82 in each case with proportionate costs.
2. In these appeals Sri Bhujangarao, learned counsel for the appellants urges that the defendants shave failed to establish the continuity and the identify of the debt of 1954 with the debts due under the suit promissory notes. On the other hand he urges that the evidence indicates that the continuity was broken and the debts were distinct,. There is no substance in this submission of Sri Bhujangarao. One has only to consider the chronology of the transactions as spoken to by the plaintiffs themselves to come to the conclusion that the defendants have successfully established the continuity and identity of the debt. (The judgment then considers the chronology of the transactions, and salient features such a charging interest as if there was no break in the period and the non availability of funds with defendants to make the payments entered in plaintiffs' accounts and holds): I have therefore no hesitation in confirming the fiddling of the learned Subordinate Judge that the continuity and indignity of the debt had been established.
3. The next and the more formidable submission of Sri Bhujangaraois that the defendants are not entitled to the benefit of Ss. 13 and 13-A of the Agriculturists Relief Act. It is not in dispute before me that defendants have salable interest in agricultural land and that they are agriculturists within the meaning of Section 3 (ii) (a) of the Agriculturists Reliefs Act. It is however contended on behalf of the plaintiffs that the defendants are not entitled to the benefit of Section 13 as they are excluded from such benefit by the explanation to Section 13. The defendants on the other hand urge that they are entitled to the benefit of Section 13 and S. 13-A of the Act. Sections 3 (ii), 13 and 13-A in so far as they are relevant are as follows:-
'3(ii) 'Agriculturist' means a person who-
(a) has a saleable interest in any agricultural or horticulatural land in the province of Madras not being land situated within a Municipality or cantonment, which is assessed by the Provincial Government to land revenue (which shall be deemed to include peshkash and quit rent) or which is held free of tax or recognised by Government; or
x x x x Provided that person shall not be deemed to be an 'Agriculturist' if he-
(A) has in both the financial years ending 31st March, 1938 been assessed to income-tax under the Indian Income-tax Act, 1922 or under the Income-tax laws of Indian State.
(B) has in all the four half years immediately preceding the 1st October, 1937 been assessed to profession-tax on a half yearly income of more than six hundred rupees derived from a profession other than agriculture under the Madras District Municipalities Act 1920, the Madras City Municipal Act, 191, the Cantonments Act 1924 or any law governing Municipal or local bodies in any other state in India or any foreign state in the continent of India or under the Madras Local Boards Act, 1920 in a Panchayat which was a Union before the 26th August 1930; or
(C) has in all the four half-years immediately preceding the 1st October 1937 been assessed to property or house tax in respect of building or lands other tax in respect of buildings or lands other than agricultural lands, under the Madras District Municipalities Act 1920 the Madras City Municipal Act 1919 the Cantonments Act, 1924 or any law governing Municipal or local bodies in any other State in Indian or under the Madras Local Boards Act 1920 in a panchayat which was a Union before the 26th August 1930 provided that the aggregate annual rental value of such buildings and lands whether let out or in the occupation of the owner is not less than Rupees 600/- or
x x x x 12. In any proceedings for recovery of a debt, the court shall, scale down all interest, due on any debt incurred by an agriculturist after the commencement of this act, so as not to exceed a sum calculated at 61/2 per cent per annum simple interest that is to say one pie per rupee per mensem simple interest, or one anna per rupee per annum simple interest;
Provided that the State Government may by notification in the Official Gazette alter and fix any other rate of interest from time to time. Explanation- For the purpose of this section the definition of 'agriculturist' in Section 3 (ii) shall be read as if
(I) in proviso (A) to that section for the expression 'the financial years ending 31st March 1938' The expression 'the financial year ending on the 31st March immediately preceding the date on which the debt is incurred' we substituted and
(ii) in provisos (B) and (C) to that section, for the expression 'the four half-years immediately preceding the 1st 'October 1937' the expression 'the four half years ending on the 31st March or the 30th September (whichever is later) immediately preceding the date on which the debt is incurred.' were substituted.'
13-A. Where a debt is incurred by a person who would be an agriculturist as defined in Section 3 (ii) but for the operation of proviso (B) or proviso (C) to that section the rate of interest applicable to the shall be the rate applicable to the debt shall be the rate applicable to it under the law, custom, contract or decree of court under which the debt arises or the rate applicable to an agriculturist under Section 13, whichever rate is less.'
It is not disputed before me that the defendants paid profession tax on a half-yearly income of more than Rs.600/- during the four half-years immediately preceding the date of the original debt as well as the dates of the promissory notes. It is also not disputed before me that the defendants paid property tax in respect of buildings whose aggregate annual rental value exceeded Rs. 600/- during the four half-years preceding the date of original debt as well as the dates of the promissory notes. The defendants therefore clearly fall within the second part of the explanation to Section 13 and that means that they are not entitled to the benefit of the provisions of Section 13.
However it is urged on their behalf that Section 13-A of the Act which was introduced by the Amending Act of 1948 enables the defendants to claim the same relief. But Section 13-A in terms applies only to persons who though agriculturists are not considered to be agriculturists because of proviso (B) or proviso (C) to Section 3 (ii) (a) that is because they have paid profession tax on half yearly income of more than Rs.600/- or paid property tax in respect of buildings whose rental value exceeded Rs. 600/- during the four half-years preceding 1-10-1937. It does not in terms apply to agriculturists who are not agriculturists because of the second part of the explanation to Section 13, that is because they have paid profession tax on half-yearly income of more than Rs.600/- or paid property tax in respect of buildings whose rental value exceeds Rs.600/- during the Four Half years preceding the Debt. Thus while Section 13 expressly excludes such persons from its benefits Section 13-A does not in terms apply to them. The result is that neither S. 13 expressly excludes such persons from its benefits Section 13-A does not in terms apply to them. The result is that neither S.13 not S.13-A is attracted to the case of the defendants. I have come to this conclusion with some diffidence but it appears to me to be unavoidable.
Sri E. Ayyapureddy, learned counsel for the respondents invites my attention to two decision of the Madras High Court; Venkatanarayana Rao v. Savansukha, : AIR1952Mad126 and Kuitalai Bank Ltd.v. Nagamanickam, : AIR1955Mad670 . In the first case Rajamannar, C.J. and Venkatarama Ajyar, J. held that Section 13-A dealt only with one subject-matter, namely the rate of interest payable by certain persons though they were not agriculturists within the definition contained in Section 3 (ii) read with the provisos and that Section 13-A did not deal with any other matter. The decision does not have any application to the present case . In the second case Mack, J., after referring to Section 13-A of the Act said 'the first defendant prior to his amendment would have not been entitled to any relief as he paid a profession tax. Under this section which now excludes in the categories of tax--payers only those who may pay income-tax from relief as an agriculturist, the 1st defendant would be clearly entitled to relief under S. 13-A i.e., to have the interest reduced to 51/2% simple per annum.' It is not clear from the judgment whether the first defendant paid profession tax during the period prior to 1-10-1937 or during the period raised in these appeals does not appear to have been raised in that case. In fact no argument appears to have been addressed on the construction of S. 13-A as the learned counsel appearing in the case as pointed out by Mack, J., were not aware of the provisions of S. 13-A. it is difficult to consider the decision as a precedent on any question.
4. The learned counsel also relied upon the decision of Jaganmohan Reddy, C.J. and A.D.V, Reddy, J, in Venkatanarayana v. Yagna Prasad, : AIR1969AP335 affirming the decision of N.D. Krishna Rao, J., in Satyanarayana v. Yagna prasad, (1965-1 Andh WR 48). In that case the question which was considered by the learned Judges was whether the provisions of Section 13-A were applicable only to debts incurred prior to the commencement of act IV of 1938, was applicable to debts incurred both prior and subsequent to the commencement of the Act. The question raised in the instant appeals, whether S. 13-A is applicable to persons part of the explanation to Section 13 was neither raised nor considered by the learned Judges. It appear to have been assumed by the learned Judges that if Section 13-A applied to debts incurred after the Act it would automatically apply to debts incurred by persons excluded by the second part of the learned Judges was apparently not drawn to the fact that Section 13-A was expressly made applicable to persons excluded from the category of agriculturists by reason of provisos (B) and (C) to Section 3 (ii) (a) of the Act but not by reason of the explanation to Section 13.
To my mind the true position appears to be this: (1) Debts incurred by persons who are agriculturists satisfying all the requirement of the definition contained in Section 3 (ii) (a) are liable to be dealt with in the manner provided by Section 8,9 and 13 of the Act whichever is applicable. (2) Debts incurred by persons who would be agriculturists but for provisions (B) & (C) to S.3 (ii)(a), that is to say persons ho are agriculturists but are not considered to be agriculturists because of payment of profession tax or property tax during the four half years preceding 1-10-1937 are liable to be dealt with under Sec. 13-A irrespective of whether the debts were incurred before or after the commencement of the Act. From the fist category of cease however are excluded debts incurred subsequent to the Act by persons who have paid profession tax or property tax in the four half years before the incurring of the debts. Such debts are excluded notwithstanding the fact that persons incurring the debts satisfy all the requirements of S.3 (ii) (a) including the provisos. That appears Section 13. I am therefore of the view that Section 13-A is applicable to debts incurred by persons who are excluded from the definition of agricultruists by provisions B and C to S. 3 (ii) (a) but not to debts incurred by persons who, are excluded from the applicability of Section 13 by reason of the special definition of agricultirists contained in the explanation to Section 13.
5. In view of my conclusion on the applicability of Ss. 13 and 13-A the appeals have to be allowed. There will be a decree in each of the suits for a sum of Rs. 10440/- with interest at 51/2% from 7-2-1962 till the date of reaslisation. The decree of the lower court regarding costs of that court will stand. There will be no order regarding costs of the appeals. In view of my finding on the main question of the applicability of Section 13 and 13-A the memoranda of Cross-objections are also dismissed, but in the circumstances without costs.
6. Appeals allowed; Memo of cross objections dismissed.