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Mer Ranmal Veman Vs. Mer Vajshi Parbat and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtGujarat High Court
Decided On
Case NumberCivil Revn. Appln. No. 623 of 1961
Judge
Reported inAIR1963Guj280
ActsDebt Law; Saurashtra Agricultural Debtors Relief Act, 1952 - Sections 2(3), 2(5) and 4; Transfer of Property Act, 1882 - Sections 59A
AppellantMer Ranmal Veman
RespondentMer Vajshi Parbat and ors.
Appellant Advocate R.C. Mankad, Adv.
Respondent Advocate J.R. Nanavaty, Adv.
DispositionRevision allowed
Cases ReferredLtd. Coimbatore v. Official Receiver
Excerpt:
property - debts - section 20 of saurashtra agricultural debtors relief act, 1952 - adjustment of debt in case of usufructuary mortgage - heirs of original mortgagor cannot make application for adjustment of debts in case of usufructuary mortgage - rule confined to usufructuary mortgage and not applicable to ordinary mortgage or debt. - - the first part provides that 'debt' means any liability in cash or kind, whether secured or un-secured, and, therefore, applies both to ordinary debts as well as to mortgage debts......kind, whether secured or un-secured, and, therefore, applies both to ordinary debts as well as to mortgage debts. the expression 'due from a debtor' applies to both. but the expression 'clue from a debtor' does not apply to the debt, which is referred to in the second part of this definition, namely 'mortgage money the payment of which is secured by the usufructuary mortgage or by anamalous mortgage in the nature of pura-chhoot of immoveable property'. in the case of such mortgage money, it would of course be 'debt' in view of the definition, but the definition does not say whose debt it is. it does not say that it shall be deemed to be debt of the heirs of the original mortgagor. it can be treated as debt due only from the original mortgagor and not of the heirs of the original.....
Judgment:

V.B. Raju, J.

1. The question raised in this revision application is an important and difficult one. This application arises out of proceedings under the S. A. D. E. Act, which will hereinafter be inferred to as the Act. An application was filed for the adjustment of debts under Section 4 of the Act by three persons Mer Vajshi Parbat, Bhoja Parbat and Giga Parbat. The debt sought to be adjusted was shown as one of Rs. 50/-, but no other particulars of the debt were given in the Schedule attached to the application. In the application it was stated, that one Ranmal Veman was in possession of certain properties as mortgagee. The application was made against Ranmal Veman and others. It is contended in this application by the learned counsel for Ranmal Veman that even according to the case of the applicants they had no dealings with Ranmal Veman and that even according to the case of the original applicants Parbat Jetha, the father of the original applicants, had mortgaged his property to one Veman Ram. It is, therefore, contended that even accord-ing to the original applicants, who made an application for the adjustment of debts, the debt was not their debt. It is, therefore, contended that such an application cannot lie under the provisions of the Act.

2. It is, therefore, necessary to consider the relevant provisions of the Act. The preamble of the Act provides that it is necessary to ameliorate the condition of Girasdars and Barkhalidars and to give them relief against the burden of debt. It provides that it is also necessary to provide relief to agriculturists other than Girasdars and Barkha-lidars against the burden of debt. Then the preamble provides that in order to achieve this purpose, it is expedient to provide for the adjustment and scaling down of their debts. It is, therefore, clear that the Act meant to adjust and scale down only their debts.

3. It is true that the words 'his debts' are not used in Section 4 of the Act, which refers to an application for adjustments of debts. That section merely provides that any debtor as provided in that section may make an application for the adjustment of debts. The words 'his debts' are, however, used in Section 4 of the B. A. D. R. Act, and we are not dealing with the provisions of the B. A. D. R. Act.

4. Although the word 'his' is not used before the word 'debts' in Section 4 of the S. A. D. R. Act, we must understand that word and hold that an application can be made by a debtor only for the adjustment of 'his' debts. This is clear from the provisions of Section 6 of the Act, and other Sections of the Act. Section 6 uses the expression 'his debtors' in the case of a creditor and 'his creditors' in the case of debtors. It also uses the expression 'of all the debts owed by such debtors.'

5. Section 7 of the Act also provides that 'if the payment of debt due by a debtor is guaranteed by surety or if a debtor is otherwise jointly and severally liable for any debt along with other person, the debtor may make an application under Section 4 for relief in respect of such debt'. It is, therefore, clear that Section 7 of the Act refers to a debt due by a debtor. Section 10 of the Act also provides as follows :

'Any settlement of a debt due from a debtor in terms of which an award has not been made under Section 9 shall not be recognised.'

It refers to a debt due from a debtor. Section 14 of the Act also provides that 'every debt due from a debtor shall in certain circumstances be extinguished.' The expression 'his creditors' is also used in Section 15 of the Act.

6. In Section 2 of the Act, which is the interpreting section, 'debtor' is defined as meaning an agriculturist whose debts do not exceed Rs. 25,000/-. It is, therefore, clear that the Act is dealing with the debts of a debtor. This is also clear from the proviso to the definition of 'debtor' contained in Section 2 (6) of the Act.

7. It is, therefore, clear that the S. A. D. R. Act contemplates an application for the adjustments of debts by a debtor in regard to his debts only and in particular in regard to the adjustment of debts due from a debtor. That debts must be due from a debtor is also clear from the definition of 'debt' contained in Section 2 (5) of the Act. That definition reads as follows :

'Debt' means any liability in cash or kind, whether secured or unsecured, due from a debtor, whether payable under a decree or order of any civil Court or otherwise, and includes mortgage money the payment of which is secured by the usufructuary mortgage, or by anomalous mortgage in the nature of Pura-Chhoot of immoveable property, but does not include arrears of wages payable in respect of agricultural or manual labour'.

This definition of 'debt' consists of two parts. The first part provides that 'debt' means any liability in cash or kind, whether secured or un-secured, and, therefore, applies both to ordinary debts as well as to mortgage debts. The expression 'due from a debtor' applies to both. But the expression 'clue from a debtor' does not apply to the debt, which is referred to in the second part of this definition, namely 'mortgage money the payment of which is secured by the usufructuary mortgage or by anamalous mortgage in the nature of Pura-Chhoot of immoveable property'. In the case of such mortgage money, it would of course be 'debt' in view of the definition, but the definition does not say whose debt it is. It does not say that it shall be deemed to be debt of the heirs of the original mortgagor. It can be treated as debt due only from the original mortgagor and not of the heirs of the original mortgagor. There is nothing in the definition or the section itself to make it a debt not only of an original mortgagor but also of his heirs. Section 58 of the Transfer of Property Act defines 'mortgage,' as follows :

'A mortgage is the transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced orto be Advanced by way of loan, and existing or future debt or the performance of an engagement which may give rise to a pecuniary liability'.

Section 59A of the Transfer of Property Act leads as follows :

'Unless otherwise expressly, provided, refe-rences in this Chapter to mortgagors and mortgagees shall be deemed to include references to persons deriving title from them respectively.'

8. In the case of such a mortgage, there-fore, there is a loan and in the absence of a specific contract of a loan to the contrary, the loan is payable by the mortgagor. As provided in Order 34, Rule 6, C. P. Code, where the net pro-ceeds of any sale held under the last preceding rule are found insufficient to pay the amount dueto the plaintiff, the Court, on application by him may, if the balance is legally recoverable from the defendant otherwise than out of the property sold, pass a decree for such balance. In the case of simple mortgage, therefore, a decree for the balance can be passed against the original mortgagor and also against his heirs in view of Section 59Aof the Transfer of Property Act. In the case of a simple mortgage therefore there is a personal liability on the heirs of the original mortgagor at least in respect of the balance referred to in Order 34, Rule 6, C. P. Code. But here we are not dealing with a simple mortgagebut with a usufructuary mortgage. In the caseof usufructuary mortgage, there is no liabilityeither on the original mortgagor or his heirs topay any money to the mortgagee in view of the definition of 'usufructuary mortgage' contained insection 58(d) of the T. P. Act.

9. It is contended that personal liability is not necessary in order to enable a debtor to make an application for the adjustment of debts, and reliance is placed on Section 20 of the Act, which refers to the mode of taking accounts.

10. In order to decide the question whetherthere should be a personal liability for the payment of a debt by the debtor, who has made an application for the adjustment of debts, we haveto look at Sections 4 and 2 of the Act, and sec-tion 20 of the Act, which refers to the mode oftaking accounts should, not be very helpful in deciding the question as to what is the nature ofthe debt in respect of which an application for the adjustment can be made.

11. It is true that Section 20 of the Actrefers to taking accounts between the parties from the commencement of the transactions subsisting between the parties and the persons (if any) through whom they claim.

12. No doubt, in the matter of taking accounts, this section contemplates the taking of accounts from the commencement of the transactions between the parties and the persons through whom they claim.

13. If the original creditor is dead and the application is made against his heirs, accounts have to be taken from the commencement of the transactions between the original creditor notwithstanding the fact that the original creditor is not a party and the parties to the application are only his heirs. We cannot ignore the expression of 'due from a debtor' used in the definition of 'debt' in view of the provisions of Section 20 of the Act relating to the mode of taking accounts. It is true that in the case of an ordinary debt there is no personal liability in the Hindu LAW upon the heirs of the original debtor. The liability is only on the property inherited by the person from whom he receives. The law is clear that there is no personal liability to pay debts of the deceased even if the heir happens to be a son. The expression used in Section 2 (5) of the Act is 'due from a debtor'. The expression used is not 'due from the property of a debtor'. In the case of a simple mortgage debt, however, in view of the provisions of Order 34, Rule 6, C. P. Code, there would be a personal liability on the heirs of the original mortgagor to the extent of the balance referred to in the said Order. That is why perhaps the definition of 'debt' did not refer to the case of a simple mortgage debts. It only made a special provision in the case of a usufructuary mortgage and provided that in the case of a usufructuary mortgage the mortgage money shall be deemed to be a debt. In the case of usufructuary mortgage there is no personal liability even on the original mortgagor in view of the provisions of Section 58(d) of the T. P. Act. But although there is no liability whatsoever the mortgage money is deemed to be a debt by Section 2 (5) of the Act. Section 2 (5) of the Act says that such mortgage money shall be deemed to be a debt, but it does not say whose debt it shall be deemed to be. Section 2(5) of the Act does not say that it shall be deemed to be a debt of the mortgagor or of the heirs of the mortgagor or of the transferees from the mortgagor. As already observed, before a debtor cap make an application for the adjustment of debts, the debts must be his debts and the debts must be due from him i. e. from that debtor. 1 have already given reasons for this conclusion. In the case of a mortgage money of a usufructuary mortgage, in view of Section 2 (5) of the Act, we can take the mortgage money to be the debt of the original mortgagor. But we cannot extend that artificial definition so as to hold that the mortgage money shall be deemed to be the debt not only of the original mortgagor but of his heirs and transferees or assigns. In this connection, it is necessary to remember the provisions of Section 8 of the Act, which reads as follows :

'No application shall lie under Section 4 for adjustment of any debt due from a debtor to whom such debt has been transferred or assigned after 1st September, 1951, by any person who is not himself a debtor'.

Ordinarily, a debt cannot be transferred. But here we are not dealing with an ordinary debt but with the mortgage money of a usufructuary mortgage as contained in Section 2 (5) of the Act. But Section 8 of the Act uses the words 'due from a debtor.' In other words, again an application for the adjustment of debts can be made by a debtor only if the debt is due from him. In the case of the heirs of the original mortgagor, it cannot be said that the mortgage money of a usufructuary mortgage is money due from them.

14. Moreover, in view of the definition of 'debt' contained in Section 2 (5) of the Act, whereby the mortgage money of usufructuary mortgage is included as a debt, we have to take it that it is deemed to be a debt from the original mortgagor, otherwise, the original mortgagor would not be able to make an application for the adjustment of his debt. But the question is whether it can be deemed to be a debt due not only from the original mortgagor but due from the heirs of the original mortgagor. Section 59A of the Transfer of Property Act reads as follows :

'Unless otherwise expressly provided, references in this Chapter to mortgagors and mortgagees shall be deemed to include references to persons deriving title from them respectively.'

But this Section has an application only to references in Chapter IV of the T. P. Act. That section cannot be applied, while interpreting the provisions of the S. A. D. R. Act. There is no section in Chapter IV of the T. P. Act which provides that there is a personal liability on the original mortgagor in the case of a usufructuary mortgage. If there is such a section, we can apply Section 59A of the T. P. Act and hold that there is a personal liability not only of the original mortgagor but also of his heirs in respect of simple mortgage debts. But in view of the definition of 'debt' contained in Section 2(5) of the Act, it must be held that under the S. A. D. R. Act a personal liability is deemed to fall on the personal mortgagor by a usufructuary mortgage. There is also a personal liability on the heirs (sic) of the original mortgagor.

15. It is open to an heir of a debtor to agree to make himself personally liable for the debt of his ancestor. In such a case, although the debt is not due from him personally under the ordinary law, it becomes due from him in view of the contract, and an application for the adjustment of such a debt can lie, and in such a case the transaction can be re-opened from the beginning as provided in Section 20 of the Act. Personal liability can be accepted as observed in Venkataramana Vilas Co., Ltd. Coimbatore v. Official Receiver, Coimbatore : AIR1940Mad30 . I, therefore, hold that in the case of a usufructuary mortgage the heirs of the original mortgagor cannot make an application for the adjustment of debts, although the mortgage money included in the definition of 'debt' contained in Section 2(5). I wish to make it clear that I am hot deciding the case of an ordinary mortgage or of an ordinary debt in this case and the question whether in such a case the heirs can make such an application is not decided by me.

16. According to the lower appellate court, the original mortgagor was the forefather of the original applicants, who made an application for the adjustment of debts under Section 4 of the Act. It is therefore clear that such an application for the adjustment of debts of a forefather cannot lie.

17. The application for the adjustment of debt is therefore dismissed. The application is also dismissed on the ground that no particulars are given in the original application. It is not mentioned in the original application what the name of the creditor is, when the debt was incurred, whether it was a mortgage debt etc. The Schedule merely mentions that a particular person is in possession of certain property. The Schedule does not say that the debt for which, the application for the adjustment of debt is made is the mortgage debt in respect of that property which is in possession of the person named.

18. The revision application is allowed, but there will be no order as to costs.


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