Poulose vs Kunjunny

C.A. Vaidialingam, J.—In this revision Petition Mr. George Varghese learned counsel for the petitioner challenges that part of the order of the learned District Judge of Alleppey wherein that Court has held, in a matter coming u/s 11(6) of Act XXXI of 1958, that the petitioner will not be entitled to the benefit of the discharge of the amount by payment in 17 equal half-yearly instalments. When the petitioner moved the trial court for relief u/s 11 (6) of Kerala Act XXXI of 1958 that Court took the view that he will be liable to pay interest at the contract rate till date of the Act and that he will get the benefit of the rate of interest under the Act only after the commencement of the Act. But trial Court held that the application filed by the petitioner for relief is barred and therefore in the end rejected the application. The petitioner challenged that order before the learned District Judge of Alleppey in A. S. 103/62. The learned Judge held that the view of the trial Court that in matters coming u/s 11 (6) of the Act, the debtor will be liable to pay interest at the contract rate till commencement of the Act is erroneous. The view taken by the learned District Judge is quite consistent with the opinion expressed by a Full Bench of this Court in the decision reported in Kelu v Ramakrishnan (1964 K. L. T. 781). According to the Full Bench decision, it is now clear that in matters coming u/s 11 (6) of the Act, the debtor is liable to pay interest only at the rate of 5% right from the date of the lease back. To that extent the order of the learned District Judge is in favour of the petitioner.

But the learned District Judge has taken the view that the petitioner is not entitled to the benefits conferred by Section 4 of the Act, namely of discharging the liability of the mortgage amount in 17 equal half-yearly instalments. The view of the learned District Judge appears to be that there is a provision in sub-section (6) of Section 4 which clearly states according to the learned Judge that the provisions of Section 4 shall not apply to, mortgages to which section 11 applies except as provided in sub-section (6) of that section. The view of the learned Judge appears to be that there is no other provision made in sub-section (6) of Section 11 making the provisions of Section 4 applicable.

In my view the contention of the learned counsel for the petitioner that the opinion expressed by the learned District Judge in the order under attack is fallacious will be clear when I refer to the provisions of clause (a) of sub-section (6) of Section 11 of Act XXXI of 1958. Mr. S. Bhoothalingam Iyer learned counsel for the creditor respondent no doubt found considerable difficulty in sustaining this part of the order of the learned district Judge. No doubt sub-section (6) of Section 4 provides that that Section will not'' apply to mortgages to which Section 11 applies, except as provided in, Section 11(6). Section. 11 applies both to mortgages taken in by sub-sections (2) to (5) as well as to usufructuary mortgages which are to be deemed to be simple mortgages if they satisfy the requirements of sub-section (6) of Section 11. But there is a crucial exception, so to say, provided in sub-section (6) of Section 4, which has missed the attention of the learned District Judge, and that is to the effect "except as, provided in sub-section (6) of that Section". Therefore the question arises as to whether from the provisions of sub-section (6) of Section 4, read with Section 11(6), it can be gathered that the operation of the other Sections has been excluded, or whether the intention of the Legislature to make the other Sections not applicable is clear from the provisions of sub-section (6) of Section 11.

Clause (a) of sub-section (6) of Section 11, after referring to the fact that such mortgage shall be deemed to be a simple mortgage from the date of the lease back, clearly says that in such a case " the provisions of this Act shall apply to the debt covered by the mortgage". There is absolutely no limitation regarding the provisions of "this Act" which are made applicable under clause (a) of subsection (6) of Section 11. If that is so, it follows that the view of the learned District Judge that the petitioner is not entitled to the benefit of payment of the debt in 17 equal half-yearly instalments is absolutely erroneous. Therefore that part of the order of the learned District Judge will have to be discharged.

Mr. Bhoothalingam Iyer learned counsel for the respondent no doubt referred to another aspect which does not arise at any rate at the present stage. According to the learned counsel the very first instalment has been deposited on the date when the sixth instalment was payable under the provisions of Section 4 of the Act. According to the learned counsel if any default is committed in the payment of any future instalments, the proviso to Section 4(5) will come into play. No doubt this proposition is demurred to by Mr. George Varghese learned counsel for the petitioner. I express no opinion whatsoever on this aspect, because that question does not arise for consideration in these proceedings. The revision is therefore allowed to the extent indicated; and it follows that the petitioner, apart from being entitled to payment of interest at the reduced rate of 5% from the date of the lease back, is also entitled to discharge the liability in accordance with the provisions of Section 4 of Act XXXI of 1958, in the manner provided therein. The parties will bear their own costs of the revision petition.