R. Sengottuvelan, J.
1. This civil revision petition is filed by the petitioner in I.A. No. 767 of 1979 in O.S. No. 1.31 of 1971 on the file of the Subordinate Judge of Coimbatore, seeking to scale down the decree debt in respect of the decree in O.S. No. 131 of 1971, as per the provisions of Section 19 of the Tamil Nadu Act TV of 1938, as amended by Act VIII of 1973. The case of the civil revision petitioner/first defendant/judgment-debtor, before the lower Court is that his father had made certain payments, set out in paragraph 8 of the order of the lower Court, towards interest and principal in respect of the debt prior to the decree and as such those payments will have to be adjusted towards the principal as per Section 8 of Act IV of 1938, as amended by Act VIII of 1973. It is also the case of the petitioner that as per Section 19(2) of the Act, he is entitled to come forward with an application for scaling down, even after the passing of the decree.
2. The decree-holder, who is the respondent herein contended before the lower Court in his counter-statement that the civil revision petitioner is assessed to income-tax as such he is not entitled to the benefits of the Act. In the additional counter-statement filed by him, a plea of estoppel had been raised.
3. Exhibit B-1 filed before the lower Court is an application on behalf of the respondent herein to the Commissioner, Sarkarsamakulam Panchayat, praying for the issue of an extract from the property tax register for the years 1970 to 1973 pertaining to the house property of the civil revision petitioner. Exhibit B-2 is the extract given by the Commissioner, Sarkarsamakulam Panchayat, stating that the rental value of Door No. 2/5, A. B. owned by the petitioner for the year 1970-71 is Rs. 1,500. No doubt, Exhibt B-2 is in the forms of a letter and it is not in the form of a true extract from the property tax register.
4. With reference to the payment of interest made prior to the decree, the learned Subordinate Judge following the observations made in Moghraj v. Mst. Bayabai (1970) 83 L.W. 31 held that the normal rule is that the payment made by the debtor in the first instance has to be applied towards the satisfaction of the interest and thereafter towards the satisfaction of the principal. Learned Subordinate Judge also observed, relying on the observations made in the case reported in S.M. Thaganar v. Sankarapandia Mudaliar (1970) 83 L.W. 31 that when a creditor with the assent of his debtor added to the principal loan the interest accrued in terms of the contract, and the debtor entered into a fresh contract trusting the consolidated amount as principal for the fresh loan, such a contract is local and there is no failure of consideration for the fresh loan. Learned Subordinate Judge also quoted an observation made in Thirunavakkarasu Mudaliar v. C.S. Rajan and Co. (1978) 2 M.L.J. 352 : 91 L.W. 322, where it has been observed that the claim for scrutiny and re-opening of account without filing a separate suit is not even permissible as a defence in a suit on a negotiable instrument. Relying on the above decisions, the learned Subordinate Judge came to the conclusion that since the interest paid on the above suit debt had already been appropriated, the judgment-debtor is precluded from claiming a re-appropriation of the said sum. Taking this view the learned Subordinate Judge dismissed the application in I.A. No. 769 of 1979. As against the said order of dismissal this revision petition is filed.
5. The first contention on behalf of the civil revision petitioner is that as per Section 8(3) read with Explanation I of Act IV of 1938, as amended by Act VIII of 1973, the judgment-debtor is entitled to have every payment made by him credited towards principal notwithstanding the fact that he has expressly stated in writing that such payment shall be in reduction of interest and the view expressed by the lower Court is not correct. In view of Explanation I to section 8 added as per Act VIII of 1973, even if the amounts had been paid towards interest and adjusted towards interest payable in respect of a debt, I the said payment will have to be re-appropriated towards the principal. The second contention on behalf of the civil revision petitioner is that the judgment-debtor/civil revision petitioner is not entitled to ask for the amendment of the decree since the decree is passed after the enactment of the amending Act VIII of 1973. On this question, the lower Court came to the conclusion that an amendment of the decree cannot be asked in respect of the decrees passed after the passing of Act VIII of 1973. It is contended on behalf of the civil revision petitioner that as per Section 19(2), the provision relating to the amendment of decrees shall also apply to a case, where after the publication of the Tamil Nadu Agricultural Relief (Amendment) Act, in the Tamil Nadu Government Gazette, a Court has passed a decree for the repayment of a debt payable at such publication.
6. No doubt, the lower Court made reference to the Bench decision of this Court re ported in Kannammal v. Subbalakshmi : (1979)2MLJ352 , in which a Division Bench of this Court had held, on a similar question relating to Act XXXVIII of 1972, that the relief could be asked by a debtor only with reference to a decree passed before the commencement of Act XXXVIII of 1972, and not in respect of the decree passed after the commencement of the Act. The observation of the Division Bench ruling cannot be applied to this case in view of Section 19(2) of the IV of 1938 which clearly states that the provisions of Section 19(1) relating to amendment of decree shall also apply to decrees passed after the publication of the Tamil Nadu Agricultural Relief (Amendment) Act (VIII of 1972), in the Tamil Nadu Gazette in respect of a debt payable at the time of such publication. In the present case the debt is of the year 1966. Hence, the conclusion arrived at by the lower Court in this aspect also is not correct.
7. The third aspect dealt with by the lower Court is the plea regarding the estoppel put forward by the decree-holder in his additional counter. The lower Court observed that the judgment-debtor volunteered himself to submit to a decree and he subscribed his signature to the joint endorsement made in the plaint, when the relief of scaling down the debt was available to him as per Act IV of 1938. But the lower Court did not give a finding on the plea of estoppel. In the case reported in Subba Rao v. Jagannadha Rao : 2SCR310 , the Supreme Court dealt with the question whether under-similar circumstances, the judgment-debtor will be estopped from putting forth a plea claiming benefits under the provisions of Act IV of 1938, after submitting himself to a decree that was passed. In the course of the-judgment, the Supreme Court observed as follows:
The contention of appellant is that a compromise decree is a decree which finally determines the rights of the parties and the case is, therefore, governed by Clause (ii) of Section 16 and not by Clause (iii) as claimed by the respondent. There seems to have been at one time some difference of opinion in the interpretation of this section in the High Court, but the view which has prevailed is that the section applies only to those decrees which can be said to be final in contradistinction to decrees which are merely interlocutory or preliminary. It has also been held now for a long time in the High Court that Clause (iii) governs all cases of money decrees in which the decree passed has not been executed or satisfied in full before the commencement of the Act.... In other words, all decrees which have been executed and satisfied before the commencement of the Amending Act on 12th January, 1949, are unaffected by the Amending Act, but all decrees which are not final and which remain to be executed either wholly or in part, are subject thereto, but the proviso states that in scaling down such decrees, the decree-holder would not be required to refund any sum which might have been paid or realised by him. No distinction is made between decrees passed after contest and decrees passed on compromise. Both the kinds of decrees are amenable to the provisions of Section 19(2) and also of Section 16(iii). There being no distinction between decrees after contest and decrees passed on compromise, the words 'in which the decree or order passed has not become final' in Clause (iii) of section 16 cannot be held to refer to a compromise decree but to decrees which are final such as final decrees for foreclosure, etc., in suits on mortgages. The prevailing interpretation of the section in the High Court is, preferable in view of the generality of the words used in Sections 19(2) and 16(iii). In any event, it would be improper to unsettle a view of law which has now become inveterate. This case was governed by Section 16(iii), read with Section 19(2) and the respondents were entitled to breach the question of the scaling down of the decree once again.
In view of the above observations of the Supreme Court, the contention of the decree-holder that on account of the judgment-debtor subscribing to a compromise he is estopped from claiming benefits under the Act will have to be negatived.
8. As per Section 3(ii)(B) a person shall not be deemed to be an agriculturist if he has in all the four half years immediately preceding 1st March, 1972, been assessed to house tax in respect of a building, the rental value of which is not less than Rs. 1,200 and the extract, Exhibit B-2, shows that the civil revision petitioner is assessed to property tax for the house the rental value of which is more than Rs. 1,200. Exhibit B-2 produced by the decree-holder merely states that the rental value of the house bearing 2/S-A B belonging to the first defendant is Rs. 1,500 for the assessment year 1970-71 and that by merely producing Exhibit B-2 the decree-holder cannot be said to have proved that the civil revision petitioner (1st defendant) is assessed to house tax, having a rental value of more than Rs. 1,200 for all the four half years, immediately preceding 1st March, 197,2. No doubt Exhibit B 2 merely states the rental value for 1970-71. But Exhibit B-l is an application by the decree-holder (respondent herein) to the Commissioner, Sarkaramakulam Panchayat Union, in which he prayed for a certificate regarding the rental value in respect of the house of the civil revision petitioner for a period of three years prior to 1972-73. But a certificate was issued only for 1970-71. When the first defendant is assessed to property tax for the year 1970-71 in respect of a house having a rental value of Rs. 1,500 unless he has parted with the house or the tax had been reduced, he would have been assessed for the subsequent year, namely 1971-72 also at the same rate. Rut in view of the fact the certificate, Exhibit B-9, is only for 1970-71, in order to ascertain whether the civil revision petitioner comes under the exemption, the respondent (decree-holder) will have to be directed to produce an extract from the property tax register for all the four half years, immediately preceding 1st March, 1982, and a conclusion arrived at on the basis of the same.
9. In view of the above discussion, the order of the lower Court cannot be supported and the same is set aside and the civil revision petition is allowed and the matter is remitted back to the lower Court for fresh disposal in the light of the observations made above. There will be no order as to costs.