Research › Search › Judgment

Rajasthan High Court · body

2005 DIGILAW 2798 (RAJ)

Santokh Singh v. Harish Kumar

2005-10-25

RAJESH BALIA

body2005
Judgment Rajesh Balia, J.-The petitioner has filed this revision petition against the order passed by the learned District Judge, Sri Ganganagar dated 29.08.2005. 2. The petitioner is a Judgment debtor of a decree passed by learned District Judge, Sri Ganganagar on 28.01.2005. The decree is a money decree for recovery of a sum of Rs. 1,43,580/-. 3. On execution being laid by the decree holder-respondent, the present petitioner approached the Debt Relief Court set up under the Rajasthan Relief of Agricultural Indebtedness Act, 1957 (in short the Act of 1957) for scaling down the debt and praying for fixing installments for repayment of the debt in respect of which the notices were issued by the Debt Relief Court on 02.08.2005. 4. Bringing to the notice of the learned District Judge these facts, the petitioner prayed that the further proceedings in execution be stayed. The said application has been rejected by the order under challenge inter alia on the ground that since, the decree was already passed and execution was laid before the petitioner had approached the Debt Relief Court, therefore, the proceedings in the execution cannot be stayed. 5. The respondent has put in appearance on caveat. The learned Counsel for the respondent urged that the petitioner has earlier raised this objection during trial of suit that the debt for which decree was claimed by the plaintiff is a debt within the meaning of Act of 1957 and the proceedings ought to be before the Debt Relief Court and not before the civil Court in respect of said dues. He claimed to be an agriculturist. In the said proceedings, it was held against the present petitioner-Judgment -debtor that amount received as earnest money on the basis of agreement to sell does not fall within the purview of debt as defined under Section 2 (c) of the Act of 1957. The said decision of the civil Court was later on affirmed by this Court in a revision preferred by the petitioner. On this premise, the learned Counsel for the respondent contends that the amount for which decree was passed in favour of plaintiff was not a debt which was governed by the provisions of the Act of 1957. Said decision having become final, it operates as res judicata at all subsequent proceedings of the same lis. On this premise, the learned Counsel for the respondent contends that the amount for which decree was passed in favour of plaintiff was not a debt which was governed by the provisions of the Act of 1957. Said decision having become final, it operates as res judicata at all subsequent proceedings of the same lis. Therefore, the petitioner is now estopped from invoking the jurisdiction of Debt Relief Court under the Act of 1957. 6. The learned Counsel for the petitioner urged that under the scheme of the Act of 1957, even if the liability of a person may not be at the inception, a debt within the meaning of Section 2 (c) of the Act but once the said liability is crystalized into a money decree, the said money decree becomes a debt. He urged that even otherwise, every money decree is a debt owned by the debtor; that position cannot be denied. Since, the petitioner claims to be agriculturist and that has not been considered or decided in the earlier proceedings, the same cannot be thwarted or stalled from investigation by the Debt Relief Court which holds the exclusive jurisdiction in this regard. He further contends that no objection has been raised about the status of the petitioner as an agriculturist, therefore, the only question which needs consideration of this Court is whether the liability which was not debt at the inception becomes a debt once it crystalized into a decree in favour of someone to whom the liability is owed. 7. This would need noticing the provisions of the Act of 1957 in so far as the same are relevant. 8. In that regard the expression “debt” has been defined under Section 2 (c) to include all liabilities owing to a creditor in cash or kind, secured or unsecured, payable under a decree or order of the civil Court or otherwise, whether due or not due, but shall not include land revenue or anything recoverable as land revenue other than the liabilities payable under a decree of a village panchayat or any other money for the recovery of which a suit is barred by limitation. 9. 9. The expression “debt” therefore, clearly includes the liability payable under a decree, indicating that wherever there is some money payable by Judgment debtor under a decree that amount, irrespective of the nature of the transaction for which decree has been passed, becomes a debt for the purposes of the Act of 1957, if the Judgment debtor is an agriculturist. 10. The other relevant provision which draws attention is Section 5 which inter alia provides that whenever a suit or an insolvency petition against a debtor shall have been brought or made and pending in a competent Court and such debtor or the person, who brought or made such suit or petition applies to such Court in this behalf , the Court shall abate such suit or petition if it is satisfied on affidavit or otherwise that an application to the Debt Relief Court under Section 6 or 6-A has been made admitted and is pending. Section 6 enables any debtor, who is liable, may file an application before the Debt Relief Court having jurisdiction in the area in which he ordinarily resides or earns his livelihood praying for determination of his debts. Section 3 ordains setting up of a Debt Relief Court at various places in the State for the purpose of giving effect to the provisions of Act of 1957. 11. Section 4 of the Act of 1957 enumerates the liabilities which are excluded from the purview of the Act. 12. Section 6 and 6-A envisages making of application by the Judgment debtor, or such of date for determination of his debts, and for recovery of settlement, if any, that may have been owned in between the debtor and all or any of his creditors. 13. On making of an application under Section 6, or 6-A, Section 5 provides for the abatement or stay of the proceedings pending in civil Courts. The course provided under Section 5 is mandatory in case the proceedings under the Debt Relief Court have been admitted and are pending. The pending petition against such debtor abates as per Section 5 (1)(c). On making of an application under Section 6, or 6-A, Section 5 provides for the abatement or stay of the proceedings pending in civil Courts. The course provided under Section 5 is mandatory in case the proceedings under the Debt Relief Court have been admitted and are pending. The pending petition against such debtor abates as per Section 5 (1)(c). If no application is made to the Debt Relief Court, still if the debtor makes an application for staying the pending suit or insolvency proceedings to enable him to make an application to Debt Relief Court, the Court is bound to stay such proceedings on being satisfied that such applicant is a debtor within the meaning of Section 5(i)(ii) of the Act of 1957. In the latter case, the further conditions is that such applicant must move the Debt Relief Court with an appropriate application within 90 days of staying of pending proceedings in civil Court or insolvency Court as the case may be. Satisfacation about applicant, being a debtor within the meaning of Act of 1957 is a jurisdictional fact on the basis of which the civil Court retains or loses its jurisdiction to proceed with such pending proceedings before it. 14. Under Section 6 after the requisite information furnished by the applicant, after giving opportunity to the other side, if the Debt Court rejects the application of the debtor finding that it does not fulfil the required criteria, the second application is barred and the proceedings in civil Court may be resumed but if the application is entertained, the suit or insolvency proceedings that may have been stayed earlier, stands abated. 15. Thus, the provisions for the stay of the pending suit and insolvency proceedings are clear, when any proceeding for determination of Debt became pended in Debt Relief Court. 9.16. The Act of 1957 envisages further jurisdiction in the Debt Relief Court for scaling down the debts. Section 10, which is a non obstantie clause, enables the Debt Relief Court to reopen all the transactions carried on during (fifteen years) immediately proceeding the last transaction or the first day of January, 1952, whichever is earlier; and determine amongst other things, the principal money originally advanced, the amount payable on account of principal and interest by the debtor to each creditor in the manner laid down in Section 10, details of which are not relevant for the present. Suffice it to notice that this includes scaling down the debt and restricts the allowance of interest. If the Debt Relief Court finds that nothing is due to the creditor it shall pass an order discharging the Debt. Section 11 provides for framing of scheme for repayment of debts so determined and transfer of debtors property. It also provided for fixing of installments where even after transfer of the property charged with the discharge of the liability, the debts remain unsatisfied. Section 12 provides that when the land revenue or rant, as the case may be, due by the debtor is suspended or remitted in whole or part, the installment shall also be suspended and shall become payable one year after the last of the remaining instalments and no interest is chargeable on the suspended installments for the period its payment remains suspended. 17. These all powers are to be exercised by the Debt Relief Court once the application is admitted and notice for such application are issued. While under the provisions of the Act the procedure applicable to the civil Court has been extended as far as practicable, under Section 21, the jurisdiction of civil Court in respect of any matter pending before the Debt Relief Court is barred. 18. In the aforesaid scenario of the provisions of the Act of 1957, it is abundantly clear that “debt” for the purpose of Section 2(c) includes the liability payable under the decree and determination of amount of debt under a decree as per the provisions of Act of 1957 falls within the jurisdiction of Debt Relief Court. To the adjudicated liability payable by the Judgment debtor, the principle of res judicata or finality of the findings adjudicated between the parties in the civil Court in the execution proceedings does not stand in the way of a Judgment debtor to approach the Debt Relief Court in respect of framing schemes in repayment of his debts which include the decreetal debt in terms of the provisions of the Act of 1957 as noticed above. 19. Under the scheme of the Act, while it may not be possible for the Debt Relief Court to calculate the liability which is due to the creditor by the debtor as a debt but it certainly exercises jurisdiction to determine the extent and the manner in which such debt can be recovered from the agriculturists. 19. Under the scheme of the Act, while it may not be possible for the Debt Relief Court to calculate the liability which is due to the creditor by the debtor as a debt but it certainly exercises jurisdiction to determine the extent and the manner in which such debt can be recovered from the agriculturists. That is to say Debt Relief Court to a certain extent act as civil Court so far as it relates to the extent of its execution while it may not affect the adjudication part of it by the civil Court which has already taken place. 20. The learned Counsel for the petitioner has invited my attention to a Full Bench decision of this Court of Gullaram vs. Govindram & Ors., AIR 1969 Raj 123 . It was a case which had arisen before this Court in a writ petition filed under Article 226 of the Constitution after the District Court in exercise of his revisional jurisdiction has taken the same view as has been taken by the learned District Judge in the present case that once a decree has been passed by the civil Court, its execution cannot be made subject matter of proceedings under the Debt Relief Court. In the case before the Full Bench, the decree holder had obtained two decrees from civil Courts in 1957. The Judgment debtor, then presented an application under Section 6 of the Act before the Debt Relief Court. The Debt Relief Court found that the decree is relating to two types of transactions; one relating to loan of grain and the other concerning the loan in cash and after examining the previous transactions, it came to the conclusion that the petitioner was not liable to pay anything so far as the loan of grain was concerned but in the account relating to loan in cash, it was held that Rs. 102/-only remained payable by him. With this findings, the Debt Relief Court upheld the claim of the decree holder only to the extent of Rs. 102/-and discharged the remaining debts. 21. 102/-only remained payable by him. With this findings, the Debt Relief Court upheld the claim of the decree holder only to the extent of Rs. 102/-and discharged the remaining debts. 21. The order of the Debt Relief Court was subjected to revision before the District Judge, who was of the view that the Debt Relief Court had no jurisdiction to go behind the decree of the civil Court and that it could taken into consideration only those payments which were made by the debtor subsequent to the passing of the decrees. 22. The Full Court set out the question for its determination as to “whether the Debt Relief Court functioning under the Rajasthan Relief of Agricultural Indebtedness Act has jurisdiction to go behind the decree of civil Court passed before the Act came into force”. 23. The Full Bench after referring to the earlier Bench decision in Karansee vs. Son singh, 1963 RLW 406 and the pronouncements of the Supreme Court while considering the scheme of the Madras Act in K. Hutchi Gowder vs. Ricobdas Fathaimall & Co., AIR 1965 SC 577 held that the scheme of Section 10 is to provide relief to the agriculturists both in the principal loan and the interest by scaling down the principal amount of the loan and the interest. Even in those cases, where a decree or order has been passed by a civil Court, the principal and the interest have got to be reduced by the Debt Relief Court while determining the debts under this section. In this connection, the view that the Debt Relief Court has jurisdiction to go behind the decree is not open to challenge, though, at the same time, the jurisdiction conferred upon the Debt Relief Court under this section is of limited nature and it can disturb the decree or order of a civil Court only to the extent permitted therein. 24. While considering Section 10, the Court opined:-“Thus, in our opinion, the scheme of Section 10 is to provide relief to the agriculturists both in the principal loan and the interest by scaling down the principle amount of the loan and the interest. 24. While considering Section 10, the Court opined:-“Thus, in our opinion, the scheme of Section 10 is to provide relief to the agriculturists both in the principal loan and the interest by scaling down the principle amount of the loan and the interest. The view, therefore, taken in 1963 RLW 406, referred to above, that the Debt Relief Court has jurisdiction to go behind the decree is not open to challenge in our opinion, thought at the same time, the jurisdiction conferred upon the Debt Relief Court under this section is of a limited nature and it can disturb the decree of order of a civil Court only to the extent permitted therein.” 25. In coming to this conclusion, the Court reiterated the view expressed by the Division Bench of this Court in Karansee case (Supra). 26. The Supreme Court in Khantis case, AIR 1965 SC 577 was concerned with the scheme of the Madras Agriculturists Act, 1938 which under Section 19 provided that “where before the commencement of this Act a Court has passed a decree for the repayment of a 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.” 27. While considering the scheme of the said Act, the Court confined the applicability of Section 19 to the decrees passed prior to the commencement of the Act and held that the provisions of 19 cannot be extended to the decrees passed after the commencement of the Act. However, considering the scheme of the Act of Madras, the Court said:- “The legal position may be briefly stated thus. Sections 7, 8, 9 and 13 from a group of sections providing the principles of scaling down of debts incurred by agriculturists under different situations. A debt can be scaled down in an appropriate proceedings taken in respect of the same. But in the case of debts that have ripened into decrees, Section 19(1) and (2) prescribe a special procedure for reopening the decree only in respect of debts incurred before the parent Act. A debt can be scaled down in an appropriate proceedings taken in respect of the same. But in the case of debts that have ripened into decrees, Section 19(1) and (2) prescribe a special procedure for reopening the decree only in respect of debts incurred before the parent Act. The parent Act does not provide for the reopening of decrees made in respect of debts incurred after it came into force and for understandable reasons the relief in respect of such decrees is specifically confined only to a concession in the rate of interest.” 28. The Full Bench of this Court noticed the specific provision in Madras Act and while clarifying that in this regard the provision of the Rajasthan Act are not very clear as to which decrees this applies, but held that:- “However, after examination the provisions of Section 10, closely, we think that although its language is not so clear as that of Section 19 of the Madras Act or Section 22 of the Bombay Agricultural Debtors Relief Act, 1947, it does confer jurisdiction upon the Debt Relief Court to go behind the decrees passed by the civil Courts and scale down the debts of the agriculturists according to its provisions. The plain reading of Sub-section (1) of Section 10 would show that it casts a duty on the Debt Relief Court that it should reopen all transactions carried on between the agriculturist-debtor and his creditor during 15 years, immediately preceding the last transaction or the first day of January, 1952 whichever is earlier. This power is to be exercised by the Court even if there is any provision for the time being in force or there is any agreement between the parties or the persons through whom they claim as to allowing compound interest. 29. From the aforesaid ratio decidendi, it is abundantly clear that the jurisdiction of Debt Relief Court to go behind the decree of the civil Court does exist under Section 10 and to that extent once the jurisdiction come to be exercised by the Debt Relief Court, the civil Court loses its jurisdiction to deal with the matter in the matter of satisfying the decree. It is exclusively to be decided by the Debt Relief Court in the first instance. It is only if the Debt Relief Court rejects the application that proceedings in civil Court resume. 30. It is exclusively to be decided by the Debt Relief Court in the first instance. It is only if the Debt Relief Court rejects the application that proceedings in civil Court resume. 30. In view of the clear provisions of the Act and binding precedents of this Court, it is clearly a case in which the learned District Judge by ignoring the definition of Debt and binding precedent of this Court has retained the jurisdiction to proceed with the case contrary to express provision of Section 5(i)(ii) of the Act of 1957 and has failed to exercise the jurisdiction vested in him by law in not granting the application for staying the proceedings in respect of application made before the Debt Relief Court. 31. Accordingly, the revision is allowed. The order of the learned District Judge under challenge is set aside and the application filed by the petitioner for staying execution proceedings pending before the learned District Judge stands allowed. The proceedings before the District Judge for executing the decree shall remain stayed until the appropriate orders are passed by the Debt Relief Court in terms of Sections 10 and 11. No order as to costs.