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Bansiram and ors. Vs. Modan Singh - Court Judgment

LegalCrystal Citation
CourtPunjab and Haryana
Decided On
Reported inAIR1948P& H33
AppellantBansiram and ors.
RespondentModan Singh
Cases ReferredJ. Kumar Uddin v. Kishen Das
Excerpt:
.....order of 3rd february 1944 the board adjourned the case to 16th march 1944, in order to enable the decree-holders to consider over the matter, on 16th march the decree-holders failed to put in appearance. (1) that the board had no jurisdiction to adjourn the case from 3rd february 1944 to 16th march 1944 and consequently their final order discharging the debt on account of the failure of decree-holders to put in appearance on 16th march was illegal and that even if the order of the board dated 3rd february was not without jurisdiction, decree-holders had sufficient cause for their failure to appear on the next day and there was no justification on the part of the board to discharge their debt. this means that if a creditor fails to appear before the board on any of the dates fixed by its..........one modan singh. the amount was to be recovered by the sale of the mortgaged property. when the decree-holders started execution proceedings, modan singh made an application to the debt conciliation board under section 9, punjab relief of indebtedness act. after the decree-holders had appeared before the board, modan singh offered to pay them rs. 350 in full and final settlement of their claim. the decree-holders refused to accept the amount offered. on this, by their order of 3rd february 1944 the board adjourned the case to 16th march 1944, in order to enable the decree-holders to consider over the matter, on 16th march the decree-holders failed to put in appearance. the board then passed an order discharging their debt. in the meanwhile the decree-holders had applied to the.....
Judgment:

Teja Singh, J.

1. The facts giving rise to this second appeal may be shortly stated Bansi Ram and others obtained a decree for Rs. 1,500 and costs against one Modan Singh. The amount was to be recovered by the sale of the mortgaged property. When the decree-holders started execution proceedings, Modan Singh made an application to the Debt Conciliation Board under Section 9, Punjab Relief of Indebtedness Act. After the decree-holders had appeared before the Board, Modan Singh offered to pay them Rs. 350 in full and final settlement of their claim. The decree-holders refused to accept the amount offered. On this, by their order of 3rd February 1944 the Board adjourned the case to 16th March 1944, in order to enable the decree-holders to consider over the matter, On 16th March the decree-holders failed to put in appearance. The Board then passed an order discharging their debt. In the meanwhile the decree-holders had applied to the executing Court on 10th February 1944 for the revival of the execution proceedings, which had been stayed in accordance with the Robkar of the Debt Conciliation Board, on the plea that the Board had authorized them to prosecute the execution application. The executing Court issued a notice to the judgment-debtor who when he appeared before the Court produced a copy of the Board's order discharging the decree-holders' debt. On 13th May 1944 the decree-holders made another application to the executing Court stating that the facts given in their previous application were not correct and praying that the proceedings in the execution application should continue, because the order of the Board discharging the debt was without jurisdiction. The matter was put in issue but was found against the decree-holders. Their appeal halving been dismissed by the learned District judge, They have come to this Court.

2. Two points were urged before me by the appellants' learned Counsel: (1) that the Board had no jurisdiction to adjourn the case from 3rd February 1944 to 16th March 1944 and Consequently their final order discharging the debt on account of the failure of decree-holders to put in appearance on 16th March was illegal and that even if the order of the Board dated 3rd February was not without jurisdiction, decree-holders had sufficient cause for their failure to appear on the next day and there was no justification on the part of the Board to discharge their debt.

3. As regards the first point, both the countsel are agreed that Sub-section (3) of Section 13, Punjab Relief of Indebtedness Act, Under which the Board presumably passed the final order discharging the debt, does not contemplate an order to this effect in so many words of the Sub-section are:

If the creditor....fails without sufficient cause to the present....at any of the hearings fixed by the board....the debt due to him....shall be deemed for all purposes and all occasions to have been fully discharged.This means that if a creditor fails to appear before the Board on any of the dates fixed by its and the Board is of opinion that his failure to be present is without sufficient cause, it has simply to record these facts and the debt shall standi discharged automatically by process of law Reference in this connection may be made to Mohomed Din v. Phula Singh. 31 A.I.R.1944 Lah.127 where it was observed that the discharge of a debt is the automatic result of the statutory provisions of Section is (2) and of the Act and no order of the Board is required declaring the debt to be discharged. I am, however, of the opinion that the mere fact that a Board's order contains a note that the debt shall standi discharged does not make the whole order illegal, because the pact of it that relates to discharge of the debt can be treated as redundant and ignored The real question, therefore to be considered in connection with the first point is whether the Board was competent to adjourn the proceedings on 3rd February 1944 to 16th March 1944 and the creditors' failure to be present on the adjourned date can be visited by the penalty provided in Sub-section (3) of Section 13. The counsel argued that when a creditor appears before the Board and the debtor makes an offer, which the former refuses to accept, all that the Board is required to do is to determine whether the debtor's offer is such that the creditor ought reasonably to accept and if it comes to the conclusion that it is, it has merely to grant the debtor a certificate in respect of the debt that he Owes to the creditor and it has no jurisdiction whatever to adjourn the proceedings for any purpose. In support of his contention the counsel relied upon Sub-section (1) of Section 20 and the observations made by Abdul Rashid, J. in Kumar Uddin v. Kishen Das. 32 A.I.R.1945 Lah,223. The following are the words of Section 20 (1):

Where daring the hearing of any application made Under Section 9, any creditor refuses to agree to an amicable settlement, the Board may, if it is of opinion that the debtor has made such creditor a fair offer which the creditor ought reasonably to accept, grant the debtor a certificate in such form as may be prescribed in respect of the debts owed by him to such creditor.Now this section must be read with the other sections of the Act and in the light of the fact that the principal function of a Debt Conciliation Board is to bring about an amicable settlement between the debtor who applies under Section 9 and his creditors. Section 15 of the Act definitely lays down that the Board shall call upon the debtor and each creditor to explain his case regarding each debt, and shall use its best endeavours to induce them to arrive at an amicable settlement. If the endeavours to be made by the Board to bring about an amicable settlement between the debtor and his creditors are to be genuine and successful, the Board should have the right to adjourn the proceedings and to allow the parties time to think Over the matter before making up their minds one way or the other. To say that as soon as an offer is made by a debtor and it is rejected by his creditor the Board must at once make up its mind whether it is going to pronounce it as fair, without allowing any time to itself to consider the matter or to the creditor to ponder over it, is to ignore the provisions of Section 15 altogether. My View, therefore, is that every Board has inherent power to adjourn the proceedings with a view, inter alia, to enable the creditor to decide for himself whether he should or should not accept the debtor's offer. A perusal of Sub-section (3) and (4) of Section 13 would also go to show that the Legislature contemplated adjournments of the proceedings. The words of Sub-section (3) are:

If the creditor....fails without sufficient cause to be present in person or....at any of the hearing fixed by the Board etc., the debt due to him or to the joint creditors, at the case may be, shall be deemed for all purposes and all occasions to have been fully discharged.These words to my mind leave no doubt that the Board can fix any number of hearings before deciding the applications made to it.

4. Before turning to the observations of Abdul Rashid, J. Kumar Uddin v. Kishen Das 32 A.I.R.1945 Lah.223, it appears to be desirable to refer briefly to the facts of that case. An application was made by a debtor to a Debt Conciliation Board praying that conciliation might be brought about between him and his creditor. It was mentioned in the application that though the debtor had mortgaged his property to the creditor, the latter had been receiving the rents of the property in dispute and had also been living in a part of the property with the result that the entire debt had been wiped out and nothing remained due to the creditor on the basis of his mortgage-deeds. The prayers contained in the application were (1) that it might be declared that nothing was due from the applicant and (2) that in casa the Board came to the conclusion that any sum was due from him to the creditor, it might be made payable by instalments. The application was made on 14th August 1939. The creditor appeared before the Board for the first time ort 16th October. In spite of the fact that the debtor had not questioned the genuineness of the debt and had merely taken the plea that it had been paid off, the Board called upon the parties to produce their accounts together with attested copies and full particulars of the debt on 18th December 1939. The creditor produced the statement of debts and fall particulars on that day. He also produced the mortgage-deeds etc. The Board thought that the statements were not properly verified and accordingly returned them to the creditor with the direction that they should be put in after verification. This order was complied with on 23rd January 1940. The Board not being satisfied with this called for certain additional accounts. Thus the proceedings before the Board went on from one date to another. On 19th March the creditor presented an application that no reconciliation was possible as the debtor was deliberately prolonging the proceedings and he prayed that they be terminated in accordance with the provisions of Section 20 of the Act. On 25-4-1940, the Board made a note that the parties were present and that the creditor had put in accounts but the accounts of the debtor had yet to be gone through. The case was, therefore, adjourned to 27th April for that purpose. On further hearings the Board took evidence and finally on 22nd November discharged the debt under Section 13(3), Punjab Relief of Indebtedness Act, on the ground that though the creditor possessed certain basis, he had deliberately refused to produce them. The Full Bench held that the order of the Board was without jurisdiction, and the following were the observations made by Abdul Rashid J. who wrote the judgment of the Bench:

When the creditor refuses to agree to any amicable settlement the only course open to the Board is to consider whether the debtor had made a fair offer which the creditor ought reasonably to accept, and if this is so a certificate should be granted to the debtor in respect of the debt owed by him to the creditor.... After the refusal of the creditor to agree to an; conclusion the Board has no right to continue the proceedings and, therefore, an order passed thereafter discharging the debt under Section 13(3) for failure of the creditor to produce certain bahis is ultra vires and without jurisdiction.5. It will thus be seen that the facts of the Lahore case are entirely different from those of the present one and the reasons for which the order of the Board was held to be without jurisdiction do not apply here. There the Board had not merely granted adjournment after adjournment but had also called upon the creditor to produce the additional account books which it had no power to do in the circumstances of the case, because the debtor had admitted that the debt in question was at one time due and the only plea taken by him was that it had been wiped out because of the reasons mentioned in his application. In the present case, the Board simply adjourned the proceedings to another date and the object of the adjournment as is definitely stated in the order, was to allow the creditors an opportunity to consider whether they would accept the debtor's offer. Then it is clear v from the last sentence of the quotation from the v judgment of Abdul Rashid, J., which I have given above, that what the learned Judge held was that the order of the Board discharging the debt for the failure of the creditor to produce bahis etc., after he had refused to accept the debtor's offer was without jurisdiction. The appellant's counsel emphasised the words 'the Board has no right to continue the proceedings.' In my view, they do not mean that the Board has no right to adjourn the proceedings for a single date even if the object be to afford time to the creditor to consider the offer made by the debtor and to decide whether he should accept it or not. When the learned Judge used the words 'continue the proceedings,' he was naturally thinking of the facts of the case which he had before him and was not laying down a general proposition. Accordingly, I hold that the order of the Board adjourning the proceedings to 16th March 1944, was not without jurisdiction. It was also urged by the appellant's counsel in connection with his first point that assuming that the Board could grant adjournments in the proceedings pending before it, the adjournment in question amounted to a misuse of the discretion vested in it by law, inasmuch as the offer made by the debtor was so ridiculous that the decree-holders could not be expected to accept it under any circumstances. I have no hesitation in repelling this contention as utterly unsound for the simple reason that the civil Courts cannot treat an order of the Board as illegal merely because it may not appear to it to be reasonable or proper. It can ignore and set aside only those orders or the Board which are without jurisdiction i. e., which are in excess or in contravention of the powers conferred on it by the statute and are, therefore, ultra vires. In this respect, I cannot do better than to quote the following passage from the judgment of the Lahore case which the appellant's counsel himself relied upon:

Reliance was placed in this connexion, on the Full Bench decision in (THIRD CITATION) where it was held that the Debt Conciliation Board is a tribunal of special jurisdiction and its powers are limited by the statute under which it was created. Such tribunal must act within its powers and so long as it does so, its orders whether right or wrong--cannot be challenged except in the manner, and to the extent, prescribed by the statute and the Courts of ordinary jurisdiction cannot question them. But where its actions are in excess, or in contravention of the powers conferred on it, they are ultra vires and of no legal effect.

The first objection of the appellants' counsel is, therefore, overruled.

6. As regards the second point, the question whether the decree-holders had a sufficient cause for not appearing before the Board on 16-3-1944, is concluded by the finding of the learned District Judge, which is one of fact and cannot be disturbed in second appeal. Besides this, my opinion is that the finding is perfectly sound. The position taken up by the decree-holders in their application of 10-2-1944 was that they had been authorised by the Board to proceed with their execution application. The Board's order of 3-2-1944, gives a direct lie to this contention and evidently it was for this reason that the decree-holders themselves gave it up later on and took their standi upon the plea that the Board's order was without jurisdiction. The second objection also fails and is decided against the appellants.

7. The result is that the appeal must standi dismissed with costs.

8. I declare that this is a fit case for a-Letters Patent Appeal.


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