1. This petition raises questions under Madras Act IV of 1938 and arises out of an application under Section 19 of that Act.
2. The lower Court held that an amount realised in execution of the decree after 1st October, 1937, could not be appropriated by the decree-holder to interest accruing due before 1st October, 1937, so as to nullify the effect of the application of Section 8(1) of the Act. The appellate Court took the view that when the decree-holder had appropriated to interest money received after 1st October, 1937, to re-adjust that money to principal after wiping off interest which accrued due on 1st October, 1937, would amount to the ordering of a refund which would be opposed to the provisions of Sub-section (4) of Section 8. That decision is clearly erroneous in the light of the Bench decision in Suryanarayanamurthy v. Viranna : AIR1941Mad226 , and the decision of the District Munsif is correct on this point.
3. The respondent however seeks to support the order of the learned Additional District Judge on another ground. The proceedings under Act IV started with an application under Section 20 filed on 22nd August, 1938, at a time when the sale in execution was pending. This application was posted for hearing to 5th September, 1938 and the sale was adjourned to the same date. On 5th September, 1938, the application under Section 20 was dismissed for default. The application under Section 19 was not filed until 29th October, 1938. It is contended that the applicant cannot be in a better position when his application under Section 20 has been dismissed than he would have been if a stay had been ordered in the first instance and also that the dismissal of his application under Section 20 bars an application under Section 19. It seems to me that there is no substance in either of these contentions. It was decided by a Bench in Kumaraswami v. Thiruvengadatha : AIR1939Mad613 , that the period prescribed under Section 20 is a period of limitation arising in the circumstances contemplated in that section, that is to say, on the grant of a stay; and the learned Chief justice observed:
So long as a debt is enforceable a debtor has a right to apply at any time for the scaling down of the debt, except in the circumstances contemplated by Section 20.
4. Quite clearly, the period of limitation prescribed in Section 20 begins to run with the grant of a stay. There was no grant of stay in this case.
5. It cannot be held that the dismissal of the application under Section 20 for default amounts to a binding adjudication that the applicant is not entitled to the benefits of the Act. An application under Section 20 is heard by the executing Court; whereas an application under Section 19 is heard by the Court, which passed the decree. The executing Court has to be satisfied prima facie that the applicant is a person who would be entitled to present an application under Section 19. But Section 20 does not contemplate any final decision on the question of the right of the applicant to apply under Section 19. Moreover, when the applicant allows his application under Section 20 to be dismissed for default, he is clearly abandoning only his right to a stay. That abandonment may be due to many causes. For instance, the execution may have stopped for some reasons quite apart from the proceedings under Act IV. In such a case, there is no point in the applicant going on with his proceedings under Section 20 if time is available to him without such proceedings for preparing his application to the Court which passed the decree, under Section 19. It would be impossible to hold that, when an agriculturist allows his application under Section 20 to be dismissed because it is not necessary, such a dismissal would bar the substantive application under Section 19.
6. In the result therefore I allow the revision petition with costs throughout and restore the order of the District Munsif.