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1975 DIGILAW 48 (KER)

MARY C. GEORGE v. SHAREEFA BEEVI

1975-02-18

P.SUBRAMONIAN POTI, S.K.KADER

body1975
Judgment :- 1. Two contentions are raised in this appeal. The plaintiff who sued on a promissory note obtained a decree against the second defendant. The first defendant was the executant of the note. As security for the amount borrowed under the note a mortgage by deposit of title deeds was created and the mortgaged properties were obtained by assignment by the second defendant from the first defendant who was the executant of the note. The first defendant has been exonerated from liability on the finding that an arrangement spoken to in the evidence of dw.1 as to the exoneration of the liability of the first defendant stands proved. Though in the appeal one of the contentions is that a decree ought to be granted against the first defendant also we find that no court fee is paid in this court for this relief and counsel does not seek any opportunity to pay such court fee. So we decline to go into that question. 2. The only other question is whether the court below was right in permitting the discharge of the debt by the second defendant in instalments under the provisions of the Kerala Agriculturists Debt Relief Act, 1970. The finding is that the first defendant is not proved to be an agriculturist, but that the second defendant has been. We assume for the present that this finding is sustainable on the evidence in the case. Then the question is whether an assign of a debtor who happens to be an agriculturist can seek to discharge the debt under the provisions of the Kerala Act 11 of 1970 when the assignor who incurred the debt originally is not an agriculturist. If the debt is due from a non-agriculturist would the assign of the debt who is an agriculturist seek the benefit of the provisions of the Act? 3. The term "debt" is defined as liability in cash or kind due from or incurred by an agriculturist on or before the commencement of the Act whether payable under a contract or under a decree or order of a court or otherwise. We are leaving out the rest of the definition which may not be relevant for our present purpose. S.2 (5) provides that 'debtor' shall include "the heirs, legal representatives and assigns of the debtor". 4. We are leaving out the rest of the definition which may not be relevant for our present purpose. S.2 (5) provides that 'debtor' shall include "the heirs, legal representatives and assigns of the debtor". 4. This court had occasion to consider the scope of the term "assign of a debtor" in the decision in A. S. No. 407 and 408 of 1972. It was said in that context: "The right under S.4 to pay off the decree debt under the provisions of Act 11 of 1970 in 17 equal instalments is conferred on an agriculturist and the right so conferred is to discharge his debt. There is no case that the person who had taken the assignment was not an agriculturist but the contention was that the debt was not his. In this context reference may be made to the definition of the term "debtor" in sub-section (5) of S.2 of the Act. That is defined so as to include the heirs, legal representatives and assigns of the debtor. There is a proviso to the definition the requirement under which is that such heirs, legal representatives or assigns also should be agriculturists. It is evident therefore that any assign of a debt is himself a debtor within the meaning of the Act. Counsel for the appellants Shri. Rajgopal very forcefully argued that any person who takes assignment of * property of a debtor will not be an assign within the meaning of the term'debtor' under the Act. Normally one associates 'assignment' with rights and not liabilities. Property is transferable unless such transfer is prohibited by law. In the same sense one cannot speak of a transfer of a debt, for a creditor looks up to his debtor to discharge his debt and it is not open to the debtor to make an assignment of his obligations in favour of another so as to bind the creditor. The concept of assignment is positive in nature. There is passing of property from one to another when such assignment is effected. A debt being an obligation there is no question of assigning any property when one "assigns" a debt in the sense that one assigns the obligation under the debt. The assignment in that context only means the assignee has been directed by the assignor-debtor to discharge his debt. A debt being an obligation there is no question of assigning any property when one "assigns" a debt in the sense that one assigns the obligation under the debt. The assignment in that context only means the assignee has been directed by the assignor-debtor to discharge his debt. Such a direction would be binding on the assignee if it is made for proper consideration. It would be a case where the assign-undertakes to discharge the debt of the assignor. Of course it is not open to the debtor to say that in view of the assignment the creditor shall have no recourse to him, for any arrangement between himself and the assign would not be binding on the creditor unless he is party to such assignment or he agrees to such assignment later. Therefore assign of a debt is a person who has undertaken to discharge the obligation of the debtor. When a person transfers his property to another and further directs the transferee to discharge his debts the transferee undertakes the alligation to pay off the debts of the transferor and that is exactly what is conceived by the term 'assign' of a debtor. We find no reason therefore to hold that a person who has taken the property of the debtor with an obligation to discharge the decree debt is not an assign of the debtor within the meaning of the term in S.2(5) of the Kerala Act 11 of 1970. If he is an assign he is a debtor for the purpose of the Act and that necessarily would mean that what is sought to be discharged is his debt. If he is an agriculturist he can seek to do so under provisions of the Act 11 of 1970" 5. The proviso to S.2(5) is significant. It reads: "Provided that in the case of a debtor, such heirs, legal representatives or assigns are also agriculturists". The proviso indicates not only that the heirs, legal representatives and assigns must be agriculturists but also that the person whose heirs, or legal representatives or assigns they claim to be must also be an agriculturist. The significance of the term "also" should not be over-looked. There is clear indication in the proviso that the Act conceives of benefit to the assign of a debtor when he is an agriculturist and his assignor also is an agriculturist. The significance of the term "also" should not be over-looked. There is clear indication in the proviso that the Act conceives of benefit to the assign of a debtor when he is an agriculturist and his assignor also is an agriculturist. This of course is quite sensible for, otherwise there is likelihood of abuse of the provisions of the Act. A non-agriculturist not entitled to the benefit of the Act could easily avail himself of such benefit by assignment of the debt to an agriculturist, and the result, it appears to us, would be anomalous. But such a situation does not arise for, in the light of the proviso to which we have adverted it is only when the assignor is an agriculturist that the assignee who is an agriculturist could claim to be a debtor within the meaning of the Act, entitled to discharge under the provisions of the Act. 6. The position being what wo have indicated above, the second defendant cannot seek discharge of the debt under the provisions of Act 11 of 1970 as his assignor is not an agriculturist. The original debtor is the first defendant. He is not shown to be possessed of any agricultural properties. He is not shown to be an agriculturist. Hence the plaintiff must succeed in his contention. The decree of the court below is modified to the extent of holding that the second defendant shall not be found to be entitled to discharge the debt in instalments under the Act 11 of 1970. 7. It is submitted by learned counsel Sri. Sankara Menon that a good part of the debt has already been paid off by regular deposit in instalments under the Act and that the balance will be deposited in a lump provided reasonable time is given. That of course is quite an attractive incentive to the decree-holder and the decree-holder's counsel is not reluctant to agree to reasonable time. We think in the circumstances it is sufficient to direct the second defendant to deposit the entire balance amount within six months from today. In case such deposit is not made the decree-holder shall be at liberty to execute the decree for the balance amount due forthwith thereafter. The appeal is allowed as above. In the circumstances of the case the parties are directed to suffer costs.