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Allahabad High Court · body

1963 DIGILAW 248 (ALL)

Rajdeo Dube v. Brij Narain Singh

1963-10-10

M.C.DESAI, R.S.PATHAK

body1963
JUDGMENT M.C. Desai, C.J. - This is an application for revision of an order passed by a Civil Judge of Jaunpur dismissing the applicant's application for reduction of his decretal debt under Sec. 4 of the Zamindars' Debt Reduction Act, No. XV of 1953. The opposite party No. 1 sold his proprietary rights in certain villages to the applicant for more than a lac of rupees on 25-4-1946; part of the price was paid in cash and part through cheques drawn on a certain bank of Calcutta. The bank went into liquidation and stopped payment of the cheques. Thereupon the opposite party filed a suit for recovery of the balance of the price and a preliminary decree under Or. XXXIV, R. 4 C.P.C. was passed in his favour calling upon the applicant to pay to him a sum of Rs. 51,000/. and odd within a certain time and directing, in default, a final decree for sale of some of the sold property. The preliminary decree was not satisfied and a final decree for sale of the property for Rs. 62,000/- and odd was passed on 19-1-1952. Before it could be sold the Zamindari Abolition and Land Reforms Act came into force on 1-7-1952. The Zamindar's Debt Reduction Act came into force on 25-51953 and the applicant applied for reduction of the amount of the final decree under Sec. 4 of it. Sec. 4 (2) (b), which is relevant in this case, is to the effect that the court which passed a decree in a suit "relating to a secured debt" shall, on the application of the judgment-debtor, calculate the amount due on the 1st day of July, 1952, from the judgment-debtors, apportion the amount between them and reduce the amount in the case of each of them in accordance with the formula given in Schedule I. Actually sub-Sec. (1) of Sec. 4 requires the court which passed a decree in such a suit to proceed as stated in sub-Sec. (2) or sub-Sec. (3). Sub-Section (2), the gist of which is stated above, applies "where the mortgaged property charged under the decree consists exclusively of estate" and it has been acquired under the Zamindari Abolition and Land Reforms Act, while sub-Sec. (3) applies when the mortgaged property charged under the decree consists partly of estate and partly of non-estate property. Sub-Section (2), the gist of which is stated above, applies "where the mortgaged property charged under the decree consists exclusively of estate" and it has been acquired under the Zamindari Abolition and Land Reforms Act, while sub-Sec. (3) applies when the mortgaged property charged under the decree consists partly of estate and partly of non-estate property. "Debt" is defined in the Act to mean "an advance in cash or in kind" and to include "any transaction which is in substance a debt." "Mortgage" with its cognate expressions is defined in the Act to have the meaning assigned to it in the Transfer of Property Act and to include a charge as defined in Sec. 100 of it. "Mortgage" is defined in the Transfer of Property Act, to mean "transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability," "transfer" is defined to mean "an act by which a living person conveys property, in present or in future, to one or more other living persons," "to transfer property" is defined to mean "to perform such act" and "charge" arises under Sec. 100 when immoveable property of one person is by act of parties or operation of law made security for the payment of money to another and the transaction does not amount to a mortgage. Certain debts are excluded from the amount to a mortgage. Certain debts are excluded from the definition of "debt"; the debt that was due from the applicant to the opposite party is not one of them. The applicant's application was contested by the opposite party on the grounds that there was no debt due to him from the applicant, that even if there was a debt it was not a secured debt and that consequently he could not claim the benefit of Sec. 4 of the Zamindar's Debt Reduction Act. The Civil Judge who had passed the final decree and to whom the application under Sec. 4 was made upheld the opposite party's objection and dis-missed the application and he has come up in revision against the order because no appeal is provided against it in the Act. 2. The Civil Judge who had passed the final decree and to whom the application under Sec. 4 was made upheld the opposite party's objection and dis-missed the application and he has come up in revision against the order because no appeal is provided against it in the Act. 2. For the applicability of Sec. 4, besides there being a decree in a suit relating to a secured debt, there must also be mortgaged property; if there is no mortgaged property the court passing the decree cannot proceed either under sub-Sec. (2), or under sub-Sec. (3) and sub-Sec. (1) would be rendered abortive. No interest in the sold property was transferred by the applicant to the opposite party after the sale of it for the purpose of securing the payment of the price; there was, therefore, no mortgage as defined in the Transfer of Property Act. There was, however, a charge because the sold property was, by operation of law, made security for the payment of its price to the opposite party, vide Sec. 55(4), Transfer of Property Act. Mortgaged property includes charged property according to the definition of "mortgage" in the Zamindar's Debt Reduction Act and thus there was mortgaged property in the instant case. 3. Nothing was advanced in cash or in kind by the opposite party to the applicant; the applicant's liability arose out of the sale of the property by the opposite party to him. The definition of "debt", e.g. "an advance in cash or in kind" applies to the word used in the definition itself; so "debt" means an advance in cash or in kind, or a transaction which is in substance an advance in cash or in kind and the question before us is whether the transaction can be said to be in substance an advance in cash or in kind. The transaction resulted in a pecuniary liability, but that is not enough to convert the liability into "debt" as defined in the Act. The essence of an advance is lacking in the cash and I do not think it can be said that the transaction was in substance an advance. The opposite party gave him land but it was by way of sale and could not possibly be said to be an advance of its price in substance. Apart from the land nothing was delivered to the applicant by the opposite party. 4. The opposite party gave him land but it was by way of sale and could not possibly be said to be an advance of its price in substance. Apart from the land nothing was delivered to the applicant by the opposite party. 4. The legislature when enacting the Zamindars' Debt Reduction Act had before it several definitions of "debt" and "loan". One is the definition of "loan" in the Agriculturists' Relief Act, No. 27 of 1934 Sec. 2(10) (a), which is "an advance whether of money or in kind, and shall include any transaction which is in substance a loan." The legislature adopted this definition as the definition of "debt" in the Zamindar's Debt Reduction Act. Another definition is of "loan" in the Debt Redemption Act No. 13 of 1940, it being "an advance in cash or kind . . . and includes any transaction which in substance amounts to such advance." Third is definition of "Debt" in the Encumbered Estates Act, No. 25 of 1934, it being "any pecuniary liability except a liability for unliquidated damages." The legislature deliberately adopted definitions of "loan" in the Agriculturists' Relief Act and the Debt Redemption Act as the definition of "debt" and not the definition of "debt" given in the Encumbered Estates Act. It is obvious that it intended to apply the Act to a case technically or substantially, of an advance and not to a case of mere pecuniary liability. A loan gives rise to a debt in the sense of pecuniary liability, but pecuniary liability may arise otherwise also and by electing the particular definition the legislature indicated its intention to restrict the Act to a pecuniary liability arising out of a loan as understood in the Agriculturist's Relief Act and the Debt Redemption Act. 5. The popular meaning of Debt, e.g. something that is due, or owing from, is not available to the applicant, because the word has been given a special meaning whenever it is used in the Act. Sec. 2 starts with the words "In this Act, unless there is anything repugnant in the subject or context, `debt' means an advance etc " The word "loan" as used in the Agriculturist's Relief Act and the Debt Redemption Act has come in for interpretation several times before this Court. Sec. 2 starts with the words "In this Act, unless there is anything repugnant in the subject or context, `debt' means an advance etc " The word "loan" as used in the Agriculturist's Relief Act and the Debt Redemption Act has come in for interpretation several times before this Court. In Nihal Singh v. Ganesh Dass-Ram Gopal, A.I.R. 1937 Oudh 124 this Court rejected the dictionary or popular meaning of debt. Srivastava, A.C.J., and Ziaul Hasan, J. observed at page 126 :-"The two basic principles underlying the idea of a loan are (1) that the property in the thing borrowed remains with the creditor and is not transferred to the debtor, and (2) that the thing borrowed is intended to be returned in specie.". The pecuniary liability in the case arose from purchase of goods on credit and, since the property in the goods purchased was undoubtedly transferred from the seller to the buyer, there was no idea of the goods being ever returned and all that was intended was that the price of the goods was to be paid afterwards, the learned Judges held that it was a case of sale for a price even though the payment of the price was deferred and that "the transaction was in no sense a loan nor can it be said that there was any advance in kind within the meaning of the definition." Ganga Nath, J. held in Khincha Mal Hari Kishan Dass v. Khub Ram Munna Lal, 1937 A.L.J. 766 that "the price due for the articles purchased by an agriculturist cannot be regarded as an advance to him in kind" and that consequently the suit for the price was not one "for recovery of a loan as defined in the U.P. Agriculturists' Relief Act." This decision was followed by Bennet and Verma, JJ. in Sukhanand Mathura Prasad v. Ram Gopal Girja Shanker, 1939 A.L.J. 160; they observed: "In the case of goods being sold we do not consider that this can be held to be an advance" without which there cannot be a loan under the Agriculturist's Relief Act. In Mohd. Shibli Khan v. Ish Datta Dikshit, 1939 A.L.J. 241 sold his half share in a lorry to D and D having no money to pay the price at once executed a mortgage in lieu of it and Mulla, J. held that the transaction was not one of loan. In Mohd. Shibli Khan v. Ish Datta Dikshit, 1939 A.L.J. 241 sold his half share in a lorry to D and D having no money to pay the price at once executed a mortgage in lieu of it and Mulla, J. held that the transaction was not one of loan. He found him self unable to hold that the sale of a share in the lorry could be said to be an advance either of money or in kind as contemplated in the definition of loan. Chitar Singh v. Roshan Singh, AIR 1943 Allahabad 301 = 1943 A.L.J. 323(1) was a case under the Debt Redemption Act and Collister, J. ruled that a sum of money remaining unpaid by a purchaser of property was not a loan, whether technically or substantially. I respectfully agree with these decisions. A purchaser's not paying the price of an immoveable property purchased by him does not amount to his being given, technically or substantially, an advance of the amount of the unpaid price by the seller. It would be illogical to say that two things are equal merely because they produce the same effect or result, and because the non-payment of the price gives rise to a pecuniary liability as an advance does, it cannot be said to be an advance even in substance. 6. Sri S. N. Misra referred us to Basanti Devi v. Har Shankar Lal, 1962 A.L.J. 93 Jhamola Kunwar v. Kailash Chandra Jain, 1962 A.L.J. 195 and Jula Ram v. Munga Devi, 1962 A.L.J. 1024. The first case is irrelevant because it was admitted in it that there was a secured debt within the meaning of the Zamindar's Debt Reduction Act and all that was contended was that it was a debt advanced on behalf of the person to whom it was due by the Court of Wards to a ward and, therefore, outside the scope of the Act. The other two cases dealt with suits to recover arrears of maintenance allowance, the payment of which was secured by a charge on immoveable property and this court held that the suits were in respect of secured debts. The court held that the unpaid maintenance allowances were secured debts, not because of the definition of "debt" contained in Sec. 2 (f), but because of the express provision in respect of maintenance allowance contained in Sec. 10. The court held that the unpaid maintenance allowances were secured debts, not because of the definition of "debt" contained in Sec. 2 (f), but because of the express provision in respect of maintenance allowance contained in Sec. 10. These two decisions are, therefore, no authority for the proposition sought to be established by Sri S.N. Misra in this case. 7. I find, in the result, that the decree in question was not passed in a suit relating to a secured debt and could not be amended under Sec. 4 of the Zamindar's Debt Reduction Act. This application should, therefore, be dismissed with costs. R. S. Pathak, J. - I agree and have nothing to add.