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Firm NaraIn Das Balkishan Das Vs. Munshi Muniruddin - Court Judgment

LegalCrystal Citation
SubjectCivil ;Property
CourtAllahabad
Decided On
Reported inAIR1940All203
AppellantFirm NaraIn Das Balkishan Das
RespondentMunshi Muniruddin
Excerpt:
.....is not a 'landlord' and has not made an application under section 4 of the act if the debt in respect of which the suit is brought had been incurred by such person jointly with another person who is a landlord and has made an application under section 4. in our opinion this argument is not well founded......on the fact that in that document the liability undertaken by the three executants was not only a joint liability but was also, in so many words, a several one. his argument is that section 9(5) of the act does not apply to such a case. he further contends that the reliance placed by the court below on the language of section 13 of the act is not correct. he urges that the relevant words of section 13 are:every claim decreed or undecreed against a landlord...shall, unless made within the time and in the manner required by this act, be deemed for all purposes and on all occasions to have been duly discharged.2. the point raised is that it is the claim against the landlord that is to be deemed to have been duly discharged, and not the claim against other persons. having heard learned.....
Judgment:

Verma, J.

1. This is an application for revision by the plaintiff, in a suit filed in the Court of Small Causes at Benares, against the decree of the Court dismissing the suit. Three persons, Nasiruddin, Muniruddin and Khabiruddin, executed a promissory note in favour of the plaintiff firm on 12th August 1934, agreeing jointly as well as severally to pay to the plaintiff on demand a certain sum of money at a certain rate of interest. Sometime in 1936, Nasiruddin and Khabiruddin made an application under Section 4, U.P. Encumbered Estates Act (25 of 1934), and the Collector passed an order under Section 6 of the Act on 6th November 1936. On 12th August 1937, the suit, out of which the application for revision has arisen, was filed against all the three executants of the promissory note, namely Nasiruddin, Muniruddin and Khabiruddin. The fact that Nasiruddin and Khabiruddin had made an application under Section 4 of the Act and that the Collector had passed an order under Section 6 having been disclosed in Court, the plaintiff made an application on 28th December 1937, stating that he wanted to proceed against Muniruddin alone and praying that Nasiruddin and Khabiruddin be exempted from the suit. The Court, in accordance with the request of the plaintiff, dismissed Nasiruddin and Khabiruddin from the suit, and directed that the suit was to proceed against the only defendant left on the record, namely Muniruddin, and a date was fixed for final decision. When the case came on for bearing an objection was taken on behalf of Muniruddin that the suit was not maintainable against him also, although he had not made any application under the Encumbered Estates Act. The learned Judge has accepted this contention and has dismissed the suit. The learned Counsel appearing for the plaintiff firm has read to us the promissory note in suit and has relied on the fact that in that document the liability undertaken by the three executants was not only a joint liability but was also, in so many words, a several one. His argument is that Section 9(5) of the Act does not apply to such a case. He further contends that the reliance placed by the Court below on the language of Section 13 of the Act is not correct. He urges that the relevant words of Section 13 are:

Every claim decreed or undecreed against a landlord...shall, unless made within the time and in the manner required by this Act, be deemed for all purposes and on all occasions to have been duly discharged.

2. The point raised is that it is the claim against the landlord that is to be deemed to have been duly discharged, and not the claim against other persons. Having heard learned Counsel on both sides, we have come to the conclusion that the contentions of the plaintiff-applicant are well founded. It seems to us that Section 9(5) of the Act contemplates only those cases in which the liability of the debtors is joint and not those cases in which it is joint as well as several. Reference has been made to the case in Swadeshi Bima Co. Ltd., Agra v. Shiv Narain (1939) 26 AIR All 75. It has been held in that case that

any person who is not a landlord but who incurs a liability jointly and severally with a landlord who makes an application under Section 4, Encumbered Estates Act, cannot plead that no suit can be instituted against him in respect of that liability. It is only in those cases where his liability with the landlord is only joint and not several that it may be open to him to contend that no suit can be instituted at all.

3. We agree with the decision that in a case where the liability of two debtors is not merely joint, but also joint and several, and one of them happens to be a landlord who makes an application under Section 4, Encumbered Estates Act, it is not open to the other to raise the objection that a suit cannot be instituted against him. The object of the U.P. Encumbered Estates Act is 'to provide for the relief of encumbered estates.' It is not intended to afford any relief to those who do not come within the four corners of the Act. The effect of the executants of the promissory note having undertaken a liability which was several is that it is open to the creditor to treat the promissory note as having been executed by any one of them singly. We see no reason therefore for accepting the contention put forward on behalf of the defendant Muniruddin that the creditor is not entitled to institute the suit against him.

4. The reasoning of the Court below based on Section 13 of the Act arises out of the fact that in the proceedings under the Act initiated by the application of Nasiruddin and Khairuddin under Section 4, the plaintiff firm did not, within the time prescribed, present to the Special Judge a written statement of its claim under Section 9(1) and (3) of the Act. In our opinion the effect of this can only be that any claim which the plaintiff might have had against Nasiruddin and Khabiruddin shall be deemed to have been duly discharged. It cannot put an end to the claim which the plaintiff may have against Muniruddin alone. Learned counsel appearing for the defendant respondent has cited the case in Babu Ram v. Manohar Lal : AIR1938All6 . That however was a case in which there was 'a joint decree and therefore a joint judgment debt,' as has been clearly, pointed out, in the judgment. The case is therefore not applicable to the facts of the present case. It has further been argued that the language of Section 7(1)(b) is very wide and that it must be held that it prohibits the institution of a suit against a person who is not a 'landlord' and has not made an application under Section 4 of the Act if the debt in respect of which the suit is brought had been incurred by such person jointly with another person who is a landlord and has made an application under Section 4. In our opinion this argument is not well founded. The material portion of the sub-clause relied on reads thus: 'No fresh suit...shall...be instituted...in respect of any debts incurred before the passing of the said order.' It seems to us that when the Section says that no suit shall be instituted, it means that no suit shall be instituted against the landlord, and not that no suit shall be instituted against any other person.

5. Our conclusion therefore is that the decision of the Court below is incorrect. Accordingly we allow this application in revision, set aside the decree of the Court below and remand the case to that Court with the direction that it shall admit it to its original number and will proceed to hear and decide it according to law. The plaintiff firm, applicant before us, is entitled to its costs in this Court. The costs in the Court below will abide the event.


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