1. This appeal arises out of a series of transactions commencing with a loan of Rs. 1000 advanced on a promissory note by the plaintiff to the defendant on 15th November 1919. The promissory note was renewed on 6th November 1922, after Rs. 5 only had been paid, by a promissory note for Rs. 1450. This in turn was renewed on 2nd November 1925 by another note for Rs. 2000 with interest at 12 per cent, and the latter by a further note on 6th November 1928 for Rs. 2720 with interest at 9 3/4 per cent. The plaintiff then sued for his dues in money suit No. 62/293 of 1931-30 claiming Rs. 8272-8-0. On 9th May 1932 a consent decree was passed for Rs. 2780. Thereafter, various execution proceedings were taken, and in all Rs. 825 was realised. The plaintiff then started Execution Case No. 102/39 on 14th July 1939 for an amount of Rs. 2034-11-6. On 30th September 1940, the judgment-debtor made an application under Section 36, Bengal Money-Lenders Act, which had just previously come into force. The trial Court held that the original transaction of loan of Rs. 1000 at 15 per cent, could not be reopened as it was more than 12 years prior to the date of the suit, apparently taking this date as being the date of the application by the judgment-debtor. The Court therefore held that the decree could not be re-opened, and directed the judgment-debtor to pay Bs. 1946-5-6 which the Court held was the balance of the decretal debt, and further directed that the amount be paid by annual instalments of Rs. 400. On appeal the District Judge of Burdwan held that 'the date of the suit' mentioned in proviso (i) to Section 36 (1), Bengal Money-Lenders Act, referred to the date in 1930 when M.S. No. 62/293 of 1931/1930 commenced and that as even the original promissory note of 1919 was within 12 years of that date, the proviso did not act as a bar; he accordingly held that the decree was liable to be re-opened and remanded the case for disposal. The plaintiff now appeals.
2. The main question for decision in this appeal is as to the interpretation to be given to proviso (i) in Section 36(1), Bengal Money-Lenders Act. The proviso was considered in Nrisingha Chandra Pal v. Kanak Lata Dassi : AIR1942Cal369 , where the Court repudiated a contention that the date referred to was the date of the application under Section 36, and held that the date must be the date when the suit contemplated by Section 36(1) was brought. A difficulty however arises in the present case in that the present application is connected with two different suits within the meaning of the sub-section when read in the light of the definition of a 'suit to which this Act applies' in Section 2(22) of the Act; it relates to the decree in the suit of 1930, and is itself made in a proceeding in execution of that decree, which proceeding is itself a suit to which the Act applied within the meaning of the definition. We may add that Section 36(1) also contemplates a third type of suit, namely, a suit by the borrower for relief. The question then is which of the three 'suits' is referred to in the proviso. The logical answer seems to be that the suit referred to must be that e type of the three types of suit contemplated by Sub-section (1) in the course of which the relief is being given, and in which therefore the question of the application of the proviso arises. If the question arises in the course of a straightforward suit by the creditor for his dues, the date will be the date of commencement of his suit, if it arises in the course of execution, that is to say in a 'suit to which this Act applies,' which happens to be an execution proceeding, the date will be the date of the application in execution, and if the question arises in a suit by a borrower for relief, the date will be the date of the borrower's suit.
3. The above seems to be the natural interpretation of the provisions of Sub-section (1) of Section 36 read with the proviso and no valid reason for any other view was put forward on behalf of the respondent beyond stressing the phrase 'suit by the parties' and urging, that this could only refer to the original suit. But a suit by a borrower against a creditor for relief is equally a suit by the parties, as is an execution proceeding by a creditor against his debtor, if that is taken to be a suit by virtue of the definition in Section 2(22) of the Act. On the other hand in none of these cases would it be really appropriate to speak of a suit 'by' the defendant, creditor, or judgment-debtor as the case may be. But the real answer to this contention, is that the phrase 'by the parties' in the proviso under consideration clearly attaches, to the words 'adjustment or agreement which has been entered into.'
4. The best that can be said for the view that the suit referred to in the proviso in question is the suit in which the creditor claims his dues is that we may surmise that the actual provision as made arose by oversight. In Satya Narayan v. Radha Nath : AIR1942Cal69 which indicates how it can be contended that the provision for a suit by a borrower for relief made in Section 36(1) is super, fluous namely, if the borrower wishes relief before his creditor has obtained a decree he can act under Section 38, and if he desires it after the creditor has obtained his decree, he can get it under Section 36(6). Similarly, it can be contended that the provision in Section 86(1) itself that relief may be obtained in execution, which provision has been made by the extension of the definition of 'suit to which this Act applies' to include proceedings in execution, merely duplicates the provision given in Section 36(6) for obtaining relief in execution. If these are in fact superfluities, and if they could be left out of consideration, then no doubt the suit in the proviso would be the original suit by the creditor. But all this is mere surmise, provision for a suit by the borrower has been made in Section 86(1), and the definition of 'suit to which this Act applies' has been extended to cover execution proceedings, and this cannot be ignored; we must give the word 'suit' in the proviso the logical meaning above indicated. It cannot be said that the effect of the interpretation is to hold that the Act means something which the Legislature could never have intended to enact; there is nothing inherently unreasonable in a provision by which the relief obtainable under Section 36 diminishes with the passage of time as the earlier terminus of the twelve year period, passes over some transaction which it would be advantageous to the debtor to have re-opened.
5. We hold therefore that in the present case the operative date is 14th July 1927, being the date twelve years prior to the date of the application in execution. This means that the calculations are to start with a loan of Rs. 2000 on a promissory note made on 2nd November 1925. We do not agree with the view apparently expressed by the trial Court (with reference in his case to the promissory note of 1919), that if the original debt was incurred before the limitation period, then the full interest contracted on that must be allowed. The interest for which the debtor is liable is governed so far as the past is concerned by the provisions of Section 30(2) of the Act. Proviso (i) to Section 36(1) merely forbids the re-opening of any adjustment or agreement purporting to close previous dealings and to create new obligations; it forbids us here going behind the promissory note of 1925 and looking further back into the past history of the adjustment made in that year. We have next to test whether relief can be given against the decree of 1932 for Rs. 2750, that is to say to ascertain if the decree imposed a liability in excess of that laid down in Clauses (1) or (2) of Section 30. As we are dealing with a liability merged in a decree prior to the commencement of the Act, the clause applicable is Clause (2); the debtor is now by retrospective operation of the clause to be deemed to have been not liable to pay interest exceeding 10 per cent, simple for the period from 2nd November 1925 to 9th May 1932, the date of the decree on a principal debt of Rs. 2000. This amounts approximately to Rs. 1300. The decree was for Rs. 2750 including the principal and was thus for an amount not in excess of the limit specified in Section 30(2). The decree therefore cannot be re-opened.
6. The lower appellate Court held that the trial Court was wrong in allowing instalments without re-opening the decree, though the point was academic in the view it took of the effect of the proviso to Section 36. In coming to this conclusion, the Court was perhaps misled by misunderstanding some decisions of this Court in mortgage suits to this very effect; the lower appellate Court overlooked the distinction between the provisions of Sub-clause (a) and those of Sub-clause (b) of Section 34(1) of the Act, the former relates to mortgage loans, and the latter to other loans. In the case of loans other than mortgage loans an order for instalments can be made on the application of the judgment-debtor at any time after the decree has been passed, whether the decree was passed before or after the commencement of the Act, and even if the judgment-debtor is not entitled to relief under Section 36. Mr. Chakravarti suggested on behalf of the appellant that no such order should now be made since the judgment-debtor did not apply under Section 34, but applied for the decree to be re-opened under Section 36; as the application can be made at any time and can still be made there is not much force in this.
7. The trial Court noted that the balance of the decree was Rs. 1946-5-6 but this figure is not accepted by the appellant : we were pressed not to alter the amount since it was not challenged by the decree-holder in the lower appellate Court. The respondent himself had the order of the trial Court upset by the lower appellate Court, and there is no reason why he should now take advantage of it. The actual amount due is merely a matter of calculation and may be ascertained in further execution proceedings if the parties cannot agree as to the amount. We therefore allow the appeal and direct that the balance of the decretal amount found due be paid by annual instalments of of Rs. 400 plus a final instalment for the balance, the first instalment to be payable on 1st August 1942. We make no order as to costs. No orders are necessary on the applications.