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Govindaswami Goundar Vs. Ramaswami Goundan and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1958)2MLJ185
AppellantGovindaswami Goundar
RespondentRamaswami Goundan and ors.
Cases ReferredLingappa Chettiar v. Chinnaswami Naidu
Excerpt:
- .....court, and such objections could not be permitted to be raised as any bar to the execution of the decree passed or as invalidating proceedings in execution including sale for realisation of amounts due under a decree. some inroad into this normal rule was effected by provisions introduced by the amending act xxiii of 1948, and it is the precise scope of these new provisions that comes up for consideration in these appeals.5. basing himself on the provisions introduced by the amending act xxiii of 1948 to which we shall advert presently, the appellant filed three applications which, if allowed, would have led to the scaling down of the decree debt and as a consequence thereof would have permitted him to have the sale held on 8th february, 1950 and confirmed on 19th december, 1952 set.....
Judgment:

Rajagopala Ayyangar, J.

1. The Letters Patent Appeals have been preferred against the Judgment of Panchapakesa Ayyar, J. in C.M.S.As. Nos. gi and 92 of 1954. The subject-matter of C.M.S.A. No. 80 of 1955 arises out of the same proceedings as those out of which the other C.M.S.As. arose and is by the same appellant in the Letters Patent Appeals and hence all these have been heard together.

2. The points arising in these appeals are simple and a few facts are necessary to be stated to appreciate how they arise. The judgment-debtor in O.S. No. 267 of 1947 on the file of the Sub-Court, Coimbatore, is the appellant in the three appeals before us. That suit was for recovery of money due on a promissory note executed on 26th September, 1944, which stipulated for interest at six per cent, per annum. The suit was filed on 25th September, 1947 and in the written statement filed by the appellant on 19th January, 1948, no objection was raised to the legality of the rate of interest charged in the promissory note. The suit was decreed on 10th February, 1948 and interest at six per cent, per annum being that stipulated for in the promissory note, was allowed. In execution of this decree the properties of the appellant were attached and brought to sale and were sold on 8th February, 1950, when they were purchased by a stranger to the suit. Petitions were filed for setting aside the sale on grounds which it is unnecessary to mention in detail in the view we have taken on the other points urged by the appellant before us but they were dismissed and the sale was confirmed on 19th December, 1952. Before the auction-purchaser obtained delivery of possession of the properties under the sale the appellant filed three applications all seeking relief under the Madras Agriculturists Relief Act, IV of 1938, which we shall refer to as the Act, and the three matters now before us arise out of them.

3. The appellant is admittedly an 'agriculturist' as defined in the Act. In regard to liabilities incurred by 'agriculturists' after the commencement of the Act (22nd March, 1938), Section 13 enacted that the maximum interest they were bound to pay was simple interest at 61-per cent, per annum. The interest of 6 per cent, per annum stipulated in the promissory note, dated 26th September, 1944. and for which a decree was passed was. therefore, well within the maximum allowed by Section 13 of the Act. Section 13 however, contained a proviso which ran:

Provided that the State Government may by notification in the Official Gazette alter and fix any other rate of interest from time to time.

4. The State Government by a notification, dated 29th July, 1947 reduced the maximum rate of interest exigible from agriculturists from 6 J per cent, per annum, as provided in Section 13 of the Act to 5^ per cent, per annum. Though this notification had effect from 29th July, 1947, the appellant did not dispute the lawfulness of the rate of interest provided in the promissory note when he filed his written statement on 19th January, 1948; and as we have stated earlier the decree, dated 10th February, 1948, provided for interest at six percent, per annum. Normally objections available to a defendant but not raised during the trial of the action should be held to be concluded against the defendant by the decree of the Court, and such objections could not be permitted to be raised as any bar to the execution of the decree passed or as invalidating proceedings in execution including sale for realisation of amounts due under a decree. Some inroad into this normal rule was effected by provisions introduced by the Amending Act XXIII of 1948, and it is the precise scope of these new provisions that comes up for consideration in these appeals.

5. Basing himself on the provisions introduced by the Amending Act XXIII of 1948 to which we shall advert presently, the appellant filed three applications which, if allowed, would have led to the scaling down of the decree debt and as a consequence thereof would have permitted him to have the sale held on 8th February, 1950 and confirmed on 19th December, 1952 set aside.

6. On 3rd December, 1952, the appellant filed I.A. No. 87 of 1953 for scaling down the decree under the provisions of the second Sub-Section of Section 19 of the Act (IV of 1938) which was introduced by the Amending Act of 1948. In furtherance of this petition for the scaling down of the decree debt he also filed on 21st December, 1952, an application under Section 20 of the Act for stay of delivery of possession and also of all further proceedings in execution pending the disposal of the application for scaling down (E.A. No. 64 of 1953). Along with this and on the same date he also filed (E.A. No. 3 of 1953) for setting aside the sale held on 8th February, 1950, under Section 23-A and B both of which were introduced by the Amending Act of 1948. All these applications were dismissed by the learned Subordinate Judge on the main ground, that the provisions of Section 19(2) regarding the scaling down of decrees were not applicable to the decree in O.S. No. 267 of 1947 against the appellant. The learned Judge who disposed of these applications also found that if the judgment-debtor was not entitled to the scaling down under the provisions of Section 19(2) of the Act, the sale held on 8th February, 1950, could not also be set aside. Other reasons were also adduced as to why the provisions of Sections 23-A and B would not apply to get the sale set aside. From the dismissal of these applications the appellant preferred appeals to the District Judge, who confirmed the decisions of the trial Court. C.M.S.A. No. 80 of 1955 was filed against the order in appeal in I.A. No. 87 of 1953, while C.M.S.As. Nos. 91 and 92 of 1954 are against the orders in E.A. No. 64 of 1953 and E.A. No. 3 of 1953 respectively. C.M.S.As. Nos. 91 and 92 of 1954 were heard together by Panchapa-kesa Ayyar, J., and he dismissed the appeals but granted leave to the appellant under clause 15 of the Letters Patent, and it is in consequence of this grant of leave that L.P.As. Nos. 48 and 49 of 1957 are before us. It would be seen that the matter involved in G.M.S.A. No. 80 of 1955 is intimately connected with the Letters Patent Appeals, and hence they have all been heard together.

7. It is not disputed by Mr. Krishnaswami Iyer, learned Counsel for the appellant that the relief of setting aside the sale prayed for in E.A. No. 3 of 1952, out of which L.P.A. No. 48 of 1957 arises would not be available, unless the appellant was entitled to have the scaling down of the decree in O.S. No. 267 of 1947 under the second Sub-Section of Section 19 introduced by the Amending Act of 1948.

8. All the three Courts which have dealt with the matter have held that Section 19(2) of the Act was inapplicable to the debt sought to be scaled down by the appellant in the present case, and we find ourselves in agreement with this view.

9. Section 19 as originally enacted in Act IV of 1938 had only one Sub-Section which ran to quote the material words:

Where before the commencement of this Act, a Gourt has passed a decree for the repayment of debt, it shall on the application of any judgment-debtor who is an agriculturist apply the provisions of this Act to such decree and shall notwithstanding anything contained in the Code of Civil Procedure, 1908, amend the decree accordingly or enter satisfaction as the case may be.

10. On its terms the benefit of scaling down would be available only in respect of decrees passed 'before the commencement of the Act' i.e., before 22nd March, 1938, and decrees passed after that date were outside its scope. Where a suit was pending for payment of monies due from an 'agriculturist' and a decree came to be passed subsequently it was held by this Court that the judgment-debtor ought to bring to the notice of the Court at the time the decree was being passed the relief to which he would be entitled under the statute, and that if he failed to do so the decree passed could not be amended subsequently by resort to Section 19. It necessarily followed that Section 19 would not apply to a case where the suit itself was filed after the commencement of the Act, for in such a case if the relief open to the defendant under the Act was not set up as a defence to the claim the ordinary rule of res judicata would preclude both the amendment of the decree as well as resistance to the execution of the decree as it stood.

11. The amendments introduced by the Amending Act XXIII of 1948 have to be viewed against this background and indeed this is put down in the Statement of Objects and Reasons in the Bill as the reasons for the change introduced into Section 19(2). This Amending Act received the assent of the Governor-General on the 12th January, 1949 and was published in the Fort St. George Gazette on 25th January, 1949. Section 10 of the Act XXIII of 1948 enacted:

Section 19 of the said Act shall be renumbered as Sub-Section (1) of Section 19 and after that Sub-Section, the following Sub-Section shall be added namely : - '(2) The Provisions of Sub-Section (1) shall also apply to cases, where after the commencement of this Act, a Court has passed a decree for the repayment of a debt payable at such commencement

12. The question which we have to consider is whether the commencement referred to in the words 'after the commencement of this Act' and a debt payable at such 'commencement' refer to the commencement of the Amending Act, that is, from 25th January, 1949, or the commencement of the parent Act, i.e., 22nd March, 1938, the former being that contended for by learned Counsel for the appellant. We are clearly of the opinion that this contention should be rejected. The 'commencement' referred in Sub-Section (2) is of the parent Act (IV of 1938).

13. In the first place Section 10 of the Amending Act merely directs a new Sub-Section to be added to Section 19 of the parent Act. The newly introduced provision is to be the second Sub-Section of Section 19, and, therefore, Section 19(1) and (2) are obviously intended to be read together. If one turns to Section 19(1) it will be seen that it opens with the words 'where before the commencement of this Act.' It is only in this context thai the words 'after the commencement of the Act' which occur in the second Sub-Section have to be understood. If the expression 'before the commencement of the Act' refers to the parent Act, the words' after the commencement of this Act 'occurring in the second Sub-Section to Section 19 cannot refer to a different Act or a period subsequent to something other than which is indicated before in Sub-Section (1). The words 'at such commencement' with which the second Sub-Section ends can refer only to 'the commencement of the Act' referred to earlier in the Sub-Section that is the antecedent to which the 'such ' could have relation. The logical result of this would be that a decree to which the provisions of Sub-Section (1) of Section 19 are attracted, would be a decree passed after 22nd March, 1938 for the repayment of a debt which was payable on or before 22nd March, 1938.

14. This construction would appear to be supported by reference to the antecedent state of the law and to the mischief or the evil which the amendment sought to remedy or rectify. Sub-Section (2) of Section 19, if it were read as a rider to Sub-Section (1), would lead to only one result, namely, that the Legislature interfered to prevent the plea of res judicata in cases where this Court had held that such a plea would be open. But the qualification introduced was not absolute but conditioned by the debt sued on being one payable at or before the commencement of the Act, 22nd March, 1938.

15. Lastly, if the construction urged by the learned Counsel for the appellant were upheld the result would be this : Section 19(1) would continue to apply to decrees passed before 22nd March, 1938, while under Sub-Section (2) decrees passed after January, 1949, in regard to debts payable at that date could be scaled down. The position, therefore, in regard to decrees passed between 22 nd March, 1938 and January, 1949, would be left in the same condition in which they were before the Amending Act of 1948, not being covered by either Sub-Section. This construction would, therefore, lead to this anomaly that cases for which even according to the Statement of Objects and Reasons provision was being made by the amendment were left unprovided for, while relief was conferred in respect of other debtors wholly unrelated to the main provisions of the Section. This, therefore, is a further and compelling reason why the construction urged by the learned Counsel before us on behalf of the appellant should be rejected. On this construction the appeals ought to fail.

16. Learned Counsel for the appellant however, placed some reliance on the terms of Section 16 of the Amending Act, whose relevant portion we shall now extract :

The amendments made by this Act shall apply to the following suits and proceedings, namely :

(iii) all suits and proceeding in which the decree or order passed has not been executed or satisfied in full before the commencement of this Act.

17. Learned Counsel pointed out that, though the sale had taken place in execution of the decree and that sale had been confirmed, as possession had not been delivered to the purchaser, the terms of Section 16 (iii) of the Amending Act were satisfied so as to render the amending provisions applicable. But Section 16 (iii) does not enlarge the scope or afford any material for construing the terms of Section 1 o of the Amending Act or Sub-Section (2) of Section 19 introduced thereby. If we had reached the conclusion favourable to the appellant on the construction of Section 19(2), Section 16(iii) of Act XXIII of 1948 would have been available to him to contend that the relief conferred by the Amending provision was still open to him. Section 16(iii) has no further effect and therefore does not afford any assistance to the appellant in the present case.

18. On the construction which we have placed on the terms of Section 19(2) of the 1938 Act, which incidentally we may note has the approval of another Bench of this Court which decided the case in Lingappa Chettiar v. Chinnaswami Naidu (1955) M.L.J. 1 the appellant would not be entitled to any relief because his promissory note on which a decree was passed was in 1944 and was not, therefore, a debt payable at the 'commencement of the Act' within the last words of Sub-Section (2) of Section 19 of Act IV of 1938. In this view the scope of Sections 23-A and B and the other objections to the setting aside of the sale raised by the respondent do not fall to be considered.

19. The result is that C.M.S.A. No. 80 of 1955 fails and is dismissed and L.P.As. Nos. 48 and 49 of 1957 also fail and are dismissed. The respondents would be entitled to their costs. One consolidated counsel's fee in the three appeals Rs. 300.


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