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Patel Parshottam Ambavi Vs. Patel Hansraj Valji Bhalodia - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtGujarat High Court
Decided On
Judge
Reported in(1979)1GLR7
AppellantPatel Parshottam Ambavi
RespondentPatel Hansraj Valji Bhalodia
Cases ReferredIn Dhulabhai v. State of Madhya Pradesh and Anr.
Excerpt:
.....agony of his creditor and will bring to the creditor the relief which is due to him and will do so quickly and..........any of the particulars mentioned in the statement, he can make an application in writing to the debt settlement officer stating the grounds of his dispute against the particulars. that is what sub-section (1) of section 8 provides. it lays down the procedure which the debt settlement officer is required to follow while adjudicating upon the disputes raised against the particular of debts either by a 'debtor' or a 'creditor'. sub-section (4) of section 8 provides that if no application is made to him by a creditor or a debtor under sub-section (1), he may make such enquiry as he may deem fit and make such order under clause (i) or under clause (ii) of sub-section (3), as the facts and nature of the case may require. section 9 provides for payment of debt. section 11 bars the.....
Judgment:

S.H. Sheth, J.

1. This appeal arises out of execution proceedings. The appellant is the judgment-debtor and the respondent is the decree-holder. Decree-holder filed Civil Suit No. 34 of 1968 for recovering from the judgment-debtor a sum of Rs. 9,500/- which were advanced in 1966. He also prayed for interest and costs. On 30th April 1969 the trial Court passed in flavor of the decree-holder decree for the entire amount with interest and costs. In order to recover the decretal debt, the decree-holder filed Execution Application No. 48 of 1969. In order to recover the decretal debt, the decree-holder attached the judgment-debtor's l/3rd share in agricultural lands which in all admeasured 32 acres 14 gunthas. To this attachment the judgment-debtor raised the objection. He contended that the lands which were attached did not belong to him. He therefore prayed for raising the attachment. This objection was rejected by the Executing Court. Thereafter the judgment-debtor's wife and children raised a similar objection and contended that the lands under attachment belong to them and not to the judgment-debtor. The Executing Court rejected their application. Thereupon they filed a substantive suit against the decree-holder under Order 21, Rule 63 of the Code of Civil Procedure. The learned trial Judge dismissed the suit. They challenged that decree in an appeal before the District Court. That appeal was also dismissed. The appellate decree was challenged in the second appeal which was also dismissed. Thereafter the execution of the decree proceeded further. Proclamation of sale was issued by the Executing Court. Before the lands under attachment could be sold, Gujarat Legislature enacted The Gujarat Rural Debtors' Relief Act, 1976 which came into force on 15th August 1976. On 6th October 1976 the judgment-debtor made an application to the authority specified in Section 6 of the said Act for the settlement of his decretal debt. That application is still pending. After having made that application, the judgment-debtor made an application to the Executing Court for staying the execution proceedings until the application made by him under Section 6 of the said Act was finally decided. In this application for stay which the judgment-debtor made, he contended that he is a 'debtor' within the meaning of the said Act and that the decretal debt due from him has abated. It was contended before the Executing Court that it had no jurisdiction to decide this contention. The Executing Court held that it had the jurisdiction to decide the contention raised by the judgment-debtor. On merits, following the decision recorded in the substantive suit filed by the judgment-debtor's wife and children, the Executing Court held that the judgment-debtor is not 'a debtor' within the meaning of the said Act. The application for stay was therefore dismissed. That decision was challenged in an appeal before the District Court. The learned appellate Judge confirmed the view taken by the Executing Court and dismissed the appeal.

2. It is that appellate order which is challenged by the judgment-debtor in this appeal.

3. Since the question which has been raised in this appeal is of wide public importance, the appeal has been referred to the Division Bench by the learned Single Judge.

4. The only contention which Mr. Nanavaty has raised before us is whether the Civil Court has jurisdiction to decide the question whether a debtor is a 'debtor' within the meaning of that expression given in Section 2(d) of the Gujarat Rural Debtors' Relief Act, 1976. He has not challenged before us the finding on merits because the question has been concluded by the decision of the Civil Court in the earlier proceedings. In order to examine the sole contention raised by Mr. Nanavaty, it is necessary to refer to a few sections of the Act and to examine its scheme in so far as it is relevant to the controversy raised before us.

5. Section 2(c) defines 'debt' which means 'any liability (inclusive of interest) which is due from a debtor in cash or kind, whether secured or unsecured, or whether payable under a decree or order of any Civil Court or otherwise, and subsisting on and legally recoverable on or after the appointed day.'. This definition makes it deer that even a decretal debt which is subsisting and legally recoverable is included within the meaning of the 'debt' given in the Act. Clause (d) of Section 2 defines debtor' so as to mean a 'marginal farmer, a small farmer, a rural labourer or a rural artisan, who on the appointed day is in debt.' Four Categories of persons have been included in the expression 'debtor'. All those four categories have been defined by the Act. Clause (g) of Section 2 defines 'marginal farmer'. It is not necessary to reproduce its definition because it is not the case of the judgment-debtor that he is a marginal farmer. The expression 'rural artisan' has been defined by Clause (1) of Section 2. The expression 'small farmer' has been denned by Clause (p) of Section 2. We do not reproduce those definitions in this judgment because it is not the judgment-debtor's case that he is a rural artisan or a small farmer. It is his case that he is a 'rural labourer' within the meaning of that expression given in Clause (m) of Section 2 and that, therefore, he is a 'debtor' within the meaning of that expression given in the Act. The expression 'rural labourer' has been defined in the following terms. It means:.a person who, being resident in a rural area, earns his livelihood principally by manual labour from any of the following occupations, but does not hold any land for any such occupations, namely:

(i) farming including cultivation or tillage of soil or horticultural operations,

(ii) cutting of wood,

(iii) dairy farming,

(iv) poultry farming,

(v) breeding of live stock,

(vi) any operation performed on a farm as incidental to preparation, transport, delivery or storage, for marketing of any of the products of any of the occupations mentioned in Sub-clauses (i), (ii), (iii), (iv) and (v).

In order to make explicit the definitions of the four expressions given in the Act, the expression 'to hold land' has been defined by Clause (q) of Section 8 in the following terms:

'to hold land', with its grammatical variations and cognate expressions, means to be lawfully in actual possession of land, whether as owner or as tenant (including a Government lessee) or as crop sharer.

Section 3 provides for discharge of debts of such debtors in certain cases and for reduction of debts in other cases. They have been specified in Section 3. Section 6 provides machinery for giving effect to the provisions of Section 3. It, inter alia, provides that every debtor shall, within such period as may be prescribed, furnish to the local authority within whose jurisdiction he ordinarily resides, a true statement in writing in prescribed form containing the following particulars in respect of every debt due by him on the appointed day to his creditors. The section thereafter provides v hat information should be given in such a statement. Sub-section (2) of Section 6 enables even a creditor to furnish such information to a local authority in respect of his debtor. Section 7 lays down the procedure for preparation and publication of statement of debts by the local authority. After the statements of debts have been published under Section 7, if a debtor or creditor raises a dispute against any of the particulars mentioned in the statement, he can make an application in writing to the Debt Settlement Officer stating the grounds of his dispute against the particulars. That is what Sub-section (1) of Section 8 provides. It lays down the procedure which the Debt Settlement Officer is required to follow while adjudicating upon the disputes raised against the particular of debts either by a 'debtor' or a 'creditor'. Sub-section (4) of Section 8 provides that if no application is made to him by a creditor or a debtor under Sub-section (1), he may make such enquiry as he may deem fit and make such order under Clause (i) or under Clause (ii) of Sub-section (3), as the facts and nature of the case may require. Section 9 provides for payment of debt. Section 11 bars the jurisdiction of the civil and revenue Courts in cases specified therein. It provides as follows:

11. (I) No Civil or Revenue Court shall entertain....

(a) any suit, appeal, or application for revision-

(i) to recover any debt to which the provisions of this Act apply;

(ii) to question the validity of any procedure or the legality of any order made by a debt settlement officer or an Appellate Officer under this Act;

(b) any application to execute a decree passed by a Civil Court against a debtor.

It is not necessary for the purposes or this judgment to refer to Sub-sections (2) and (3) of Section 11. Section 12 confers upon the Debt Settlement Officer the jurisdiction to decide the disputes specified therein. It provides as follows:

12. If a question arises in any proceeding under this Act as to-

(a) whether a person ii a debtor;

(b) whether a debtor is marginal farmer, small farmer, rural artisan, or rural labourer;

(c) whether the income of a rural artisan exceeds or does not exceed rupees 2,400 per year or as the case may be, rupees 4,800 per year;

(d) whether any liability is a debt or not; the debt settlement officer shall decide such question and his decision shall be final and shall not be called in question in any Court.

6. Relying upon Sections 11 and 12 it has been contended by Mr. Nanavaty that the jurisdiction of the Civil Court to decide whether the judgment-debtor is a 'debtor' within the meaning of the Act is barred on account of the fact that he has applied to the local authority under Section 6 for the ultimate settlement of his debt. It is therefore, necessary firstly to closely examine the ambit of jurisdiction conferred upon the Debt Settlement Officer by Section 12. We have no doubt in our minds that in matters in respect of which jurisdiction has been conferred upon the Debt Settlement Officer the jurisdiction of the Civil Court has been excluded. We say so because the decision of the Debt Settlement Officer has been made final and it has been further provided that it shall not be called in question in any Court. It is well settled that wherever the decision of a special tribunal created by a statute is made final, the jurisdiction of the plenary court is excluded. In Dhulabhai v. State of Madhya Pradesh and Anr. : [1968]3SCR662 the principle which has been laid down by the Supreme Court is that where the statute gives finality to the orders of special tribunals, the Civil Court's jurisdiction must be held to be excluded if there is an adequate remedy to do what a Civil Court would normally do in a suit. It has been further laid down that such a provision, however, does not exclude those cases where the provisions of the particular Act have not been complied with or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure. The next principle which has been laid down in that decision is that where there is an express bar of the jurisdiction of the Civil Court, it may be relevant to examine the adequacy or the sufficiency of the remedies provided by the Act but such an examination is not decisive to sustain the jurisdiction of the Civil Court. Where, therefore, there is an express bar of the jurisdiction of the Civil Court and where a special tribunal has been created to deal with the questions arising under the statute, such a special tribunal has the exclusive jurisdiction to decide the questions and controversies arising under that statute. So far as the controversy which has been raised before us is concerned, it is sufficient for a to note from the decision of the Supreme Court that the jurisdiction of the Civil Court is excluded not only where there is an express bar of jurisdiction but also where the statute has given finality to the orders of a special tribunal. In the latter case, the limited jurisdiction which the Civil Court has is in respect of finding out whether the provisions of the statute have been complied with or not and whether the statutory tribunal has acted in conformity with the fundamental principles of judicial procedure. In the instant case, Section 12 confers jurisdiction upon the Debt Settlement Officer to decide the questions which have been specified therein. Section 13 provides an appeal against the decision or order of a Debt Settlement Officer. The order passed in appeal by an appellate officer has also been given finality. It is clear, therefore, that Sections 12 and 13 provide adequate machinery for deciding questions specified in Section 12. In our opinion, the finality accorded to the decision under Section 12 or under Section 13 excludes the jurisdiction of the Civil Court in matters specified therein.

7. It has been argued by Mr. Vyas that by virtue of the provisions of Section 12 the jurisdiction of the Civil Court is excluded in a case where a question specified in Section 12 has been decided in any proceeding under the said Act. According to him, therefore, if any of the questions specified in Section 12 does not arise in any proceeding under the said Act but in any other proceeding the jurisdiction of the Civil Court is not barred. Continuing his argument he has further tried to point out to us that the expression 'any proceeding' used in Section 12 does not mean any proceeding of any type whatsoever but a proceeding originating under Section 6. The expression 'proceeding' indeed has a wider meaning. Every suit, appeal or an original application is a proceeding but every proceeding cannot be a suit, appeal or an original application. Can we say that if in a suit, appeal or execution application an objection based on the provisions of the said Act is raised, necessitating a trial of that objection, it is a proceeding under the Act? Mr. Vyas has argued that the expression 'any proceeding under this Act' does not contemplate such a proceeding. It contemplates only a proceeding instituted under Section 6. Mr. Nanavaty who appears on behalf of the judgment-debtor has also adopted the same line of reasoning and argued that the expression 'any proceeding under this Act' used in Section 12 means a proceeding instituted under Section 6 and not a proceeding arising out of an objection raised in a suit or an appeal or anywhere else on the basis of the provisions of the said Act. In our opinion, the narrower meaning assigned to the expression 'any proceeding under this Act' by Mr. Vyas and Mr. Nanavaty is justified. We record this conclusion not because both the learned Advocates concede it but because we are convinced of the merits of their arguments. If the Legislature had intended otherwise, it could as well have not used that expression and conferred exclusive jurisdiction upon the Debt Settlement Officer to decide questions specified in Section 12 irrespective of where they originate. The limited connotation of the expression 'any proceeding under this Act' used in Section 12 receives support from Section 11. It, inter alia, provides that no Civil or Revenue Court shall entertain 'any suit, appeal, or application for revision to recover any debt to which the provisions of this Act apply...or any application to execute a decree passed by a Civil Court against a debtor.' The bar of jurisdiction of a civil or revenue Court comes into play only where an attempt is made to recover a debt to which the provisions of the said Act apply. Obviously, therefore, the question which arises in such a case is: who has to decide whether the provisions of (lie Act apply to a particular debt or not? Or, in case of execution proceedings, who has to determine whether the judgment-debtor is a 'debtor' within the meaning of the said Act? The bar of jurisdiction of a Civil or Revenue Court comas into play only where there is a debt to which the provisions of the said Act apply or a decretal debt due from 'a debtor' as defined in the Act.

8. In this context we may usefully refer to Section 85 of the Bombay Tenancy and Agricultural Lands Act, 1948. The language used in Section 85 is materially different from Section 11 of the Gujarat Rural Debtors' Relief Act, 1976. Sub-section (I) of Section 85 creates a blanket bar of jurisdiction of the Civil Court to settle, decide or deal with any question which is by or under the Tenancy Act required to be settled, decided or dealt with by the Mamlatdar, the Tribunal and other authorities specified in that section. It provides as follows:

85. (1) No Civil Court shall have jurisdiction to settle, decide or deal with any question which is by or under this Act required to be settled, decided or dealt with by the Mamlatdar or Tribunal, a Manager, the Collector, the Gujarat Revenue Tribunal or the State Government in appeal or revision or the State Government in exercise of their powers of control.

(2) ....

The language of Sub-section (1) of Section 85 leaves no doubt in our minds that in matters specified in that section there is a total exclusion of the jurisdiction of the Civil Court. There is no such exclusion of jurisdiction of the Civil Court provided by Section 11. In case of Sub-clause (i) of Clause (a) and in case of clause (b) of Sub-section (11) of Section 11 the bar of jurisdiction of civil or revenue Court comes into play only where the provisions of the Act apply or where the decretal debt is sought to be recovered from 'a debtor' as understood by the said Act. It is, therefore, clear that before the Civil Court comes to the conclusion that it has no jurisdiction to deal with a controversy purporting to be under the provisions of the Gujarat Rural Debtors' Relief Act, 1976, it must first decide whether the controversy relates to the recovery of a debt to which the provisions of the Act apply or relates to the recovery of a decretal debt against a 'debtor' within the meaning of the said Act. These are, in our jurisdictional facts. If the Civil Court comes to the conclusion that provisions of the said Act do not apply to the recovery of a particular debt, it certainly will have the jurisdiction to proceed with the suit, appeal or application for revision. Similarly, if the Civil Court comes to the conclusion that the judgment-debtor is not 'a debtor' within the meaning of the said expression given in the said Act, it will have the jurisdiction to proceed with the execution' application. The scheme of Section 11 does not show that as soon as a defendant or a judgment-debtor raises a plea purporting to be under the Gujarat Rural Debtors' Relief Act, 1976, its jurisdiction is excluded. Before the Civil Court excludes its jurisdiction in such matters, it has got to decide one of the two preliminary questions. They are:

(i) Whether the provisions of the Gujarat Rural Debtors' Relief Act, 1976 apply to a debt sought to be recovered from a defendant;

(ii) Whether a judgment-debtor from whom the decretal debt is sought to be recovered is a 'debtor' within the meaning of the said Act. If the answer to the relevant question is in the affirmative, obviously the jurisdiction of the Civil Court is excluded. If it is in the negative, the jurisdiction of the Civil Court is not excluded.

9. The next question, therefore, which arises relates to the exact limits of the jurisdiction of the Civil Court under Section 11 and the jurisdiction of the Debt Settlement Officer under Section 12. We have already stated in the foregoing parts of this judgment that the expression 'any proceeding' used in Section 12 has reference to the proceedings instituted under the provisions of Section 6 of the said Act. In such proceedings, the Debt Settlement Officer has the exclusive jurisdiction to decide any of the questions specified in Section 12. The decision which he records on any of those questions in such proceedings is final subject indeed to an appeal under Section 13. Such a decision cannot be called in question in a Civil Court firstly because it is final and secondly because it has been so expressly provided in Sub-clause (ii) of Clause (a) of Sub-section (1) of Section 11 which provides as follows:

11. (1) No Civil or Revenue Court shall entertain--(a) any suit, appeal, or application for revision-

(i) ....

(ii) to question the validity of any procedure or the legality of any order made by a debt settlement officer or an Appellate Officer under this Act.

Therefore, once the Debt Settlement Officer or the Appellate Officer records a decision on any of the questions specified in Section 12 in proceedings instituted under Section 6 the jurisdiction of the Civil Court to examine its validity on any ground whatsoever is barred. Such a decision is binding upon the Civil Court and it must act upon it if it is necessary for it to do so in any suit, appeal or other civil proceedings including execution proceedings.

10. What happens, however, where no such decision has been recorded by the Debt Settlement Officer or the Appellate Officer? Mr. Nanavaty has argued before us that as soon as a defendant or a judgment-debtor makes an application under Section 6 of the said Act for settlement of his debt, the jurisdiction of the Civil Court under Section II is excluded. We are unable to uphold the contention raised by Mr. Nanavaty because what the Civil Court has been prevented from questioning is the validity of any order made by a Debt Settlement Officer or an Appellate Officer under the said Act. The Civil Court or the Revenue Court has not been prevented by the said Act from proceeding further merely because an application under Section 6 of the said Act has been made. To entertain the contention raised by Mr. Nanavaty is to take the view that once an application is made under Section 6 of the said Act, the proceedings before the Civil Court must be stayed and that the Civil Court cannot even proceed to examine whether the 'debt' in respect of which the person indebted seeks relief is governed by the provisions of the said Act or whether the person indebted is a 'debtor' within the meaning of that expression given in the said Act. To accede to the contention which Mr. Nanavaty has raised is to render infructuous the provisions of Sub-clause (i) of Clause (a) and the provisions of Clause (b) of Sub-section (3) of Section 11 because a person who is in debt will certainly make an application under Section 6 and then raise the contention in the proceedings before the Civil Court. If we take the view which Mr. Nanavaty has canvassed before us, there will be hardly any case worth the name in which the Civil Court will have to decide the jurisdictional fact specified in Sub-clause (i) of Clause (a) or the jurisdictional fact specified in Clause (b) of Sub-section (1) of Section 11. We are, therefore, unable to uphold the contention raised by Mr. Nanavaty.

11. So far as the philosophy underlying the said Act is concerned, what the Legislature has intended to do is to give relief to certain classes of debtors. The relief has not been given in absolute terms. It is conditional upon the existence of facts specified in the said enactment. A genuine debtor who is entitled to relief under the said enactment and who seeks it will always get it on proof of facts which are conditions precedent. It is immaterial whether he proves the existence of those facts either in a Civil Court or before the Debt Settlement Officer. Therefore, the view which we are taking does not defeat the object of the enactment. On the contrary, it has a positive merit inasmuch as it will prevent a dishonest and unscrupulous debtor from prolonging the proceedings to the undue detriment to his creditor. If we take the view that as soon as an application under Section 6 is made by a debtor, the jurisdiction of the Civil Court to decide the questions specified in Sub-clause (i) of Clause (a) and in Clause (b) of Sub-section (1) of Section 11 will be excluded, it will encourage dishonesty and perfidiousness and cause unnecessary and undue damage to the creditor. We say so because a dishonest and unscrupulous debtor, as soon as the suit is filed against him by his creditor, will take up the plea under the said Act, make an application under Section 6 of the said Act, force his creditor to face the proceedings before the Debt Settlement Officer, the appellate proceedings before the appellate officer and probably a writ petition in this Court. Only after the debtor has failed before all these forums, the creditor will be able to obtain a decree against him even though the plea raised by the defendant was palpably false, dishonest and unscrupulous. Therefore, the view which we are taking strikes a golden mean. It will effectively prevent a dishonest and unscrupulous debtor from prolonging the proceeding to the detriment and agony of his creditor and will bring to the creditor the relief which is due to him and will do so quickly and expeditiously.

12. We are, therefore, of the opinion that by virtue of the provisions of Section 12 read with Section 11(1)(ii) of the said Act, the Debt Settlement Officer has exclusive jurisdiction to decide the questions specified in Section 12 in a proceeding instituted under Section 6 of the said Act. If in such proceedings a decision has been recorded by the Debt Settlement Officer, the Civil Court by virtue of Section 11(1) (ii) is bound by it and must act upon it. In all other cases, where there is no decision of the Debt Settlement Officer operating in the field, the Civil Court irrespective of whether proceedings under Section 6 have been instituted or not has the jurisdiction to decide whether the provisions of the said Act apply to the recovery of the debt which is the subject-matter of proceedings before it. Similarly, the Civil Court has jurisdiction to decide whether a judgment-debtor against whom execution proceedings have been instituted is a 'debtor' within the meaning of the said Act, If the Civil Court comes to the conclusion that the debt or decretal debt, which is the subject-matter of proceedings before it, is governed by the provisions of Section 11 or is sought to be recovered from 'a debtor' within the meaning of that expression given in the said Act, the other provisions of the said Act will come into force and the defendant or the judgment-debtor will be entitled to ask the Civil Court to give him relief which is due to him under the provisions of the said Act. If the Civil Court comes to the conclusion that a particular debt is not governed by the provisions of the said Act or that the judgment-debtor from whom the decretal debt is sought to be recovered is not a 'debtor' within the meaning of the expression given in the said Act, the Civil Court has jurisdiction to proceed further with the proceedings before it and to deal with and dispose them of in accordance with law.

In our opinion, therefore, in the instant case, the Executing Court had the jurisdiction to decide the objection which the judgment-debtor raised even though application made by him under Section 6 was pending. The impugned order, therefore, suffers from no infirmity whatsoever.

No other contention has been raised by Mr. Nanavaty before us.

13. In the result, since the sole contention raised by him fails, the appeal fails and is dismissed with no order as to costs. Since the appeal is decided, Civil Application does not survive. Therefore, rule is discharged with no order as to costs. Writ to be sent to the trial Court within one month after the judgment is signed.


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