Kumaraswami Reddiar vs Muthugopal Naicker (deceased) and Others

Wadsworth, J.—The first of these petitions arises out of an application u/s 23 of Madras Act IV of 1938, to set aside a sale. The second

petition arises put of a connected application by the same judgment-debtors to amend the decree u/s 19 of the Act. The decree in question in both

the petitions-was passed on a mortgage executed by the defendants 1 to 3. The applicants in the Court below were the legal representatives of the

first defendant together with the second and third defendants. The eighth defendant in the mortgage suit was impleaded as puisne mortgagee of

items 3 to 9 and 12 out of the 13 items in the hypotheca. He did not prove his mortgage, and no decree was passed in his favour, except that the

judgment contained a direction that, in the sale, the items in which he was not interested should be sold first and the other items subsequently in the

same sale. The ninth defendant was impleaded in the mortgage suit on the ground that she claimed a charge for maintenance.

On 17th April, 1936, a receiver was appointed, and he continued in possession right up to the time of the sale. A preliminary decree was

passed on 28th August, 1936, for a sum of Rs. 6,869 and odd. There was no personal remedy. After a final decree had been passed, a sale was

held on 18th October, 1937. At this sale, 12 out of the 13 items of property were sold, and realised a sum of Rs. 4,900 and odd. Item 6 which is

the family house was not sold. Part-satisfaction was recorded, on 19th November, 1937. Act IV of 1938 came into force on 22nd March, 1938,

and the present applications were filed in April, 1938. The only respondent impleaded was the plaintiff-decree-holder, who was also the purchaser

at the sale. The only evidence as to the agriculturist status of the applicants appears to relate to the mortgage lands, and the objections seem to

have been based on such irrelevant matters as the object for which the money was borrowed, the possession of the lands, etc. In the lower Court,

it seems to have been assumed that, if the applicants had a saleable interest in agricultural lands at the time of the sale in October, 1937, they Were

agriculturists entitled to the benefits of Sections 19 and 23 of the Act. The lower Court does not discuss the evidence on this part of the case at all,

and it appears to me probable that the learned Judge failed to realise the importance of proof that the applicants were agriculturists at the time

when they made their application.

Section 23 of the Act starts with reference to a sale on or after 1st October, 1937, of property in which an agriculturist had an interest, but it

seems to me clearly to require in the later portion of the section that the applicant must be a judgment-debtor claiming to be an agriculturist entitled

to the benefits of the Act, and that the Court has to be satisfied ""that the applicant is an agriculturist entitled to the benefits of this Act."" These

words seem to me to contemplate a state of affairs in which the applicant has a saleable interest in agricultural land at the time when he makes his

application. The same words are found in Section 19, ""any judgment-debtor who is an agriculturist."" In the definition of the term ""agriculturist"" in

Section 3, we find that he is a person who has a saleable interest. Whatever time is contemplated in this definition, it cannot well be anterior to the

commencement of the Act. Section 7 also contemplates the scaling down of debts payable by an agriculturist at the commencement of the Act.

Section 23 is really an extension of Section 7 in that it permits an agriculturist to attack a sale held in execution of a decree during the period

when the Act was under consideration. But I am not prepared to hold, having regard to the words of this section, that this remedy is open to a

person who is not an agriculturist at the time when he makes the application. This is a view of the law which does not appear to have been present

in the mind of the Court below, and it may be that the applicants could have proved that they were agriculturists, having regard to the facts existing

at the time of their application, even though, so far as their interest in the properties sold is concerned, it cannot be, said that they had a saleable

interest in those properties at the time when they applied to set aside the sale.

A further difficulty is based on the fact that the applicants took out notice only to the decree-holder-auction-purchaser. The proviso to Section

23 requires that there should be notice to the decree-holder, the auction-purchaser and other persons interested in such sale. The words ""other

persons interested in such sale"" would not, apparently, include all persons who were parties to the suit. The intention appears to be that notice

should go to all persons interested in upholding the sale. If there are judgment-debtors who are anxious that the sale should be set aside, they have

the right to come in as applicants if they are agriculturists; they are not persons who are interested in upholding the sale.

But the position of the eighth defendant, the puisne mortgagee, seems rather dubious. It was alleged in the Court below that he was a non-

agriculturist. I have not been able to find any evidence to this effect. If he was a non-agriculturist, it seems to follow, on the basis of the decision of

the Bench to which I was a party, in C.S. Ramier Vs. B.N. Srinivasiah, , that he is not entitled to the benefit of any scaling down of the decree

which may result from the application of the agriculturist judgment-debtors. If so much is conceded, it follows that if the decree is scaled down on

the application of the present applicants, the whole of the burden of the balance of the decree amount after the scaling down will be thrown on item

6, the only item not sold, which is one of the items in which the eighth defendant claims an interest. On such facts, if they be correct, it would

appear that the eighth defendant is interested in upholding the sale, although he does not claim any title under the court-auction-purchaser. I am of

opinion that, if the facts are as alleged, he should have been given notice before the sale was set aside; and, although Section 19 does not expressly

require notice to a non-agriculturist judgment-debtor, it is, to my mind, obviously desirable in a case where the result of the application u/s 19 may

be to increase the burden of another judgment-debtor, that he should have notice.

In the result, therefore, I allow both these petitions, and remit both the cases to the trial Court which will dispose of the matters afresh in the light

of this judgment, after giving notice to the eighth defendant and after recording finding on such fresh evidence as may be tendered on both sides on

the question whether the applicants were agriculturists entitled to the benefit of the Act at the time when their applications were presented. Costs

will abide the result.