Mutha Venkateswarlu vs Kotha Venkatraju

Wadsworth, J.—This Civil Revision petition arises out of a Small Cause suit and raises questions under Sections 8 and 9 of Madras Act IV

of 1938. The suit debt relates back to an original promissory note Ex. B dated the 15th May, 1930, executed by the first defendant in favour of the

plaintiff and his brother Krishnamurthi. Krishnamurthi died and after his death the plaintiff and Krishnamurthi''s son agreed that the balance due

under Ex. B should be divided between them in equal shares. The debtor accordingly executed two fresh promissory notes, one in favour of the

plaintiff which is the suit promissory note (Ex. A) and the other in favour of Krishnamurthi''s son. The lower Court has treated Ex. A as a renewal

of Ex. B to the extent of plaintiff''s share in that debt and has scaled* down the debt applying the explanation to Section 8 of the Act. It seems to

us that this conclusion cannot be supported in view of our decision in the case of S. Ramasubbier and Another Vs. P. Rama Aiyar and Others, .

We had to deal there with a debt due to one Srinivasa Aiyar who died and after his death there was a partition between his two sons and two fresh

promissory notes were executed for unequal amounts, one in favour of each of the two sons. We held in scaling down the claims in the two suits on

these two promissory notes, that the debtor was not entitled to go back to the original promissory note in favour of the father. We observed that:

The explanation to Section 8 requires that the debt must continue in substance to be the same though the amount and the parties under the various

documents given as vouchers for it need not be strictly identical. This requirement cannot be regarded as satisfied when the debt is divided among

the heirs of the creditor and the debtor executes a separate instrument for a part of the debt in favour of each of such heirs.

An attempt has been made to distinguish that case from the present on two grounds : Firstly because that was a case of an original debt to the

father superseded by two separate debts to the sons and not, as in the present case, a joint debt superseded by two separate debts. The other

ground of distinction is that the earlier case was one of a division of the original debt into two unequal amounts, whereas here we are concerned

with a division into two halves. The first distinction seems to us more apparent than real. In S. Ramasubbier and Another Vs. P. Rama Aiyar and

Others, the father (the original debtor) died and on his death his two sons would be jointly entitled to the debt, so that the position when the two

separate promissory notes were executed was practically the same as the position in the present case, namely, a joint debt in favour of two

brothers superseded by two separate debts one in favour of each. The distinction on the basis of the disparity of the amount of the two promissory

notes is a distinction which might possibly have force if the decision in S. Ramasubbier and Another Vs. P. Rama Aiyar and Others, had been

influenced by the fact that the amounts of the two new promissory notes were unequal. But it does not appear to us that that was the basis of the

decision at all. The basis for the decision was that a single debt was superseded by two new and separate debts each in favour of one of the two

persons who were jointly entitled. No doubt, the fact that the new debts were for unequal amounts makes the danger of treating them as identical

with the original debt more apparent, but the principle is the same whether the new debts are equal or unequal.

We are of opinion therefore that the debtor is not entitled on the facts of the present case to treat the promissory note (Ex. A) as a renewal of

the earlier promissory note (Ex. B). Ex. A was executed on the 29th September, 1934 and it has to be scaled down u/s 9 of the Act. The revision

petition is therefore allowed with costs and there will be a decree for the principal amount due under the promissory note with interest at five per

cent. up to 22nd March, 1938, credit being given to the two payments endorsed on the note as on the dates on which they were paid and for

subsequent interest on the aggregate amount at six per cent. Proportionate costs will be allowed to the plaintiff in the lower Court.