Janakiraman vs Chandra

Srinivasan, J.—As the Civil Miscellaneous appeal has to be dismissed on the ground that the sale held by the executing court during the

pendency of the application for stay under the Tamil Nadu Agriculturists Debt Relief Act IV of 1938, as amended by Act VIII of 1973, was a

nullity, following the decision of Ramanujam, J. in Nachimuthu Chettiar and Another Vs. Moorthammal, , it is not necessary for me to consider the

other points urged by learned counsel for the appellant. The respondent-judgment debtor filed E.A. 387 of 1981 on 24-11-1981, for stay of the

execution proceedings pending filing of an application under S. 19 of the Debt Relief Act, for scaling down the decree. While that application was

pending, the Court auction sale was held by the executing court on 23-12-1981. Thereafter, the court dismissed E.A. 387 of 1981 as infructuous

as the sale had already been held. That order was challenged by the respondent in C.R.P. 2494 of 1982. This court, by order dated 3-11-1982,

allowed the civil revision petition and remanded the matter for fresh disposal. The Court disposed of the execution application on merits on 23-1-

1987. The application was dismissed. The Court took the view that the respondent had not proved her status as an agriculturist.

The Court below set aside the sale on the ground that the executing Court had no jurisdiction to hold the sale because of the pendency of E.A.

387 of 1981. The Court below has relied upon the decision of Ramanujam, J. in Nachimuthu Chettiar and Another Vs. Moorthammal, 40. The

relevant petition of the said judgment reads thus:�

In this case we are concerned with the question as to whether the execution sale is contrary to S.20 of the Tamil Nadu Act 4 of 1938 and, as such,

void and without jurisdiction. It is no doubt true that the executing Court has undoubted jurisdiction to realise the decree amount by sale of the

judgment debtors, property. The question is whether the said jurisdiction of the executing Court was in any way affected by the provision in S. 20.

S.20 reads as follows� Every Court executing a decree passed against a person entitled to the benefits of this Act, shall on application, stay the

proceedings until the Court which passed the decree has passed orders on an application made or to be made under S.19.

Provided that, where within 60 days after the application for stay has been granted the judgment debtor does not apply to the Court which passed

the decree for relief under S.19 or where an application has been so made and is rejected, the decree shall be executed as it stands

notwithstanding anything contained in this Act to the contrary.

Under this Section every person entitled to the benefits of the Act may apply for the reliefs mentioned therein and seek a stay of the execution

proceedings so as to enable such a person to do so. The section makes it obligatory on the Court to stay the execution proceedings on an

application made by the judgment debtor claiming the benefits under the Act. The section uses the expression ''shall'', on application, stay the

proceedings. The above expression rules out any discretionary power on the part of the executing court either to stay the proceedings or not. The

Section seems to suggest that once an application for stay of the execution is filed by the judgment debtor claiming benefits under the Act it is

obligatory on the part of the court to decide the question whether the judgment debtor is an agriculturist and is otherwise entitled to the relief under

the Act and to stay the execution proceedings if it is found to be affirmative. Having regard to the language used in S. 20 of the Act and the object

with which it is made, it can easily be taken that the jurisdiction of the executing Court to execute the decree is suspended or kept in abeyance

once an application for stay of execution is filed under S.20 claiming benefits of the Act, until the said application is disposed of S.20 can,

therefore, be treated as a fetter on the power of the executing Court to execute the decree as against an agriculturist. If in a particular case, the

executing Court proceeds to execute the decree overlooking the said fetter, imposed by S. 20, it can be taken to have acted without jurisdiction.

I have no hesitation to agree with the decision of Ramanujam, J. that the executing Court has no jurisdiction to proceed with the execution once

an application under S.20 has been filed. It is certainly open to the executing Court to consider the application on the materials available and come

to a prima facie conclusion whether the applicant is an agriculturist or not and decide whether stay should be granted or not. Instead of disposing of

the application for stay, the executing Court could not proceed with the execution and after completing the execution dismiss the application as

infructuous. That is why this Court set aside the order passed by the executing Court in C.R.P. 2494 of 1982 and reminded the matter for fresh

disposal Hence the position is clear that the execution sale in this was held on a day on which the application under S.20 of the Debt Relief Act

was pending before the court. The matter is squarely covered by the decision of Ramanujam J. and following the reasoning therein. I hold that the

sale on 23-12-1981 is a nullity, in view of the fact that the executing Court had no jurisdiction to hold the sale on that date.

Learned counsel for the appellant contends that the subsequent dismissal of the execution application on merits by the Court on 23-1-1987

would relate back to the date of the sale and that the sale should be held to be valid on account of the same. There is no authority for this

proposition. Nor is there any substance in it. In a similar situation, with regard to the filing of a suit during the period when the statutory moratorium

was in force, a Bench of this Court had to consider the question in Kuttayan Chettiar v. Surendranathachari 95 L.W. 492, and it was held that the

institution of the suit during the subsistence of the moratorium was not valid and that it ought to be dismissed. The Bench overruled some earlier

judgments that the suit could be kept stayed and taken up for disposal after the expiry of the moratorium. If that principle is applied, the argument

of learned counsel for the appellant that the later order of the court dismissing E.A. 387 of 1981 on merits will relate back to the date of sale,

cannot be accepted. Even on first principle, a transaction which is null and void, ab initio, cannot be validated by a subsequent event.

It is next contenced by learned counsel for the appellant that there should be an express order of stay by the executing Court the mere filing of

an application under S.20 will not operate as stay of the execution proceedings. This contention is unsustainable in view of the judgment of

Ramanujam, J. The section is mandatory in its terms and it reads tint the court executing a decree shall, on an application, stay the proceedings until

the court has passed orders on the application made or to be made under S.19. This clearly shows that once an application is filed under S.20, the

executing Court has to stop the execution proceedings and dispose of the said application on merits and if the application is dismissed, it can

proceed with the execution. Without doing so, if the executing Court proceeds with the execution and after completing the same proceeds to

decide the application for stay, it would only mean that the Court proceeds to defer the application with a view to defeat its purpose without

deciding it on merits. That course cannot be adopted by the Court. It is not open to the court to ignore the statutory stay granted by S. 20 of the

Act. As it is a statutory provision preventing the court from executing the decree, it is automatic and on the filing of the application, further

proceedings should be stayed till the disposal of that application. Hence this contention of the learned counsel is rejected.

Learned counsel invites my attention to the observations of Ramanujam, J. in the aforesaid decision in paragraph 12 of the judgment. In that

paragraph, the learned Judge has considered the two extreme views taken by Natarajan, J. and Varadarajan, J. and come to the conclusion that

both are not acceptable. The learned Judge has pointed out that in an application under S.20, the executing Court should consider the question

whether, on the materials placed before it, the status of the applicant as an agriculturist entitled to the benefits of the Act was prima facie proved.

To the court comes to the conclusion that he would be entitled to the benefits of the Act, then stay should be granted and otherwise the court

should dismiss the application for stay. The two extreme views taken by the other two learned Judges were not accepted by Ramanujam, J. That

does not help the appellant in the present case.

It is stated by learned counsel for the respondent that the entire decree amount has been deposited already by the respondent in the executing

court on 20-3-1983 and that it should be declared that the decree has been fully satisfied. It is certainly open to the respondent to apply to the

executing Court to take the amount already in deposit in court to the credit of the execution petition and treat the decree as fully satisfied. The

executing court will consider such an application by the respondent and pass appropriate orders. In the result, this appeal fails and is dismissed.

There will be no order as to costs.