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Mylavaram Adisubbayya Vs. Panchangam Subba Sastry - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1946Mad103; (1945)2MLJ517
AppellantMylavaram Adisubbayya
RespondentPanchangam Subba Sastry
Excerpt:
- - in fact the order by the board in this case is that the creditor did not produce accounts and that consequently it was compelled to take action under section 10(2) of act xi of 1936. firstly, there is nothing like action under section 10(2) which can be taken by the board, and secondly, such action of discharging the debt cannot be taken for the non-production of accounts......section 4 of the act for the settlement of his debts and in the application had mentioned this decree debt. the decree-holder in this case had filed a counter therein in which he furnished the necessary particulars relating to his decree debt. the debt conciliation board passed an order on 13th august, 1940, ex. d-2, in which they concluded that they were compelled to take action against this creditor inter alia under section 10(2) of the act according to which section they said, the debts due to him by the debtor shall be deemed to have been discharged for all purposes and for all occasions. subsequently on 5th february, 1943, the execution petition out of which this petition arises was filed and it was opposed by the judgment-debtor on the ground that by reason of the.....
Judgment:

Yahya Ali, J.

1. The petitioner obtained an assignment of the decree in O.S. No. 607 of 1933 of the District Munsiff's Court of Penukonda and applied in E.P. No. 83 of 1943 for the execution of the decree against the respondent. The respondent had filed an application before the Debt Conciliation Board under Section 4 of the Act for the settlement of his debts and in the application had mentioned this decree debt. The decree-holder in this case had filed a counter therein in which he furnished the necessary particulars relating to his decree debt. The Debt Conciliation Board passed an order on 13th August, 1940, Ex. D-2, in which they concluded that they were compelled to take action against this creditor inter alia under Section 10(2) of the Act according to which section they said, the debts due to him by the debtor shall be deemed to have been discharged for all purposes and for all occasions. Subsequently on 5th February, 1943, the execution petition out of which this petition arises was filed and it was opposed by the judgment-debtor on the ground that by reason of the aforementioned order of the Debt Conciliation Board the decree debt stood discharged and hence there was no debt in respect of which execution could be levied. The learned District Munsiff disallowed the objection and allowed execution to proceed. He held that the order of the Board was ultra vires of its powers and that it was not necessary that it should be set aside before execution could be proceeded with. On appeal the learned Subordinate

2. Judge agreed with the first Court that the order of the Board was erroneous but was of the opinion that it was not ultra vires of its powers and that consequently the Civil Court had no jurisdiction to vacate, cancel or ignore the order of the Board. The present application is to revise the said order of the Subordinate Judge.

3. Section 8(i) of the Debt Conciliation Act provides:

On receipt of an application under Section 4 the board shall unless it rejects the application under Section 7 pass an order fixing a date and place for hearing the application.

4. In pursuance of the notice issued under that provision the decree-holder appeared and filed the counter in which all necessary particulars about the decree debt were-furnished. Section 10(1) refers to the issue of a further notice after the examination of the debtor calling upon the creditor to submit a statement of debts within two months from the date of service or publication of the notice. Sub-section (2) of Section 10 as it then stood before its amendment by Madras Act IX of 1943, provided:

every debt of which a statement is not submitted to the board in compliance with the provisions of Sub-section (1) shall be deemed for all purposes and all occasions to have been duly discharged.

5. Both the Courts below have held that the counter initially filed in this case by the petitioner was a statement of debt for the purposes of Section 10(1). In fact the learned Counsel for the petitioner goes to the length of arguing that if a person's debt is mentioned even in the application filed under Section 4 or in the particulars furnished under Section 6 that is sufficient compliance with the requirement under Section 10(1) of furnishing a statement of debts. Then Section 19(a)(4) says:

No Civil Court shall entertain any suit in respect of the recovery of any debt which has been deemed to have been duly discharged under Sub-section (2) of Section 10.

On an examination of these provisions I am inclined to agree with the view taken by the learned District Munsiff. The Act does not require that the Board should pass any order either under Section 10(1) or under Section 10(2). The effect provided in Section 10(2) in the event of a statement of debts not having been filed of the debts standing discharged is statutory and follows as a matter of law, and no specific order of the Board is required for that purpose. In fact the order by the Board in this case is that the creditor did not produce accounts and that consequently it was compelled to take action under Section 10(2) of Act XI of 1936. Firstly, there is nothing like action under Section 10(2) which can be taken by the Board, and secondly, such action of discharging the debt cannot be taken for the non-production of accounts. The case of non-production of accounts is covered by Section 11 which postulates that where the necessary documents including entries in books of account are not produced such documents shall not be admissible in evidence against the debtor in any suit brought by the creditor or by any person claiming under him for the recovery of the debt. That is the only penalty that is contemplated for the non-production of accounts and not the penalty enacted in Section 10(2) of the Act. Having regard to all these circumstances there is no doubt in my mind that the order of the Debt Conciliation Board was ultra vires and is liable to be ignored. Attention was drawn to the bar provided under Section 19. That bar is against filing of suits. With reference to execution petitions, Section 19(b) bars only those execution petitions in which execution has been suspended under Sub-section (3) of Section 18. The learned District Munsiff was therefore right in the view that the order of the Board should be ignored as a nullity and execution should be proceeded with. The petition is allowed with costs throughout, reversing the order of the Subordinate Judge of Anantapur and restoring the order of the District Munsiff.


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