P.V. Ramalinga Chetti vs Petha Goundan and Others

Alfred Henry Lionel Leach, C.J.—This appeal raises a question with regard to the effect of Section 19 of the Madras Debt Conciliation Act,

1936. On the 6th December, 1922, the respondents, who are brothers and constitute an undivided Hindu family, executed a mortgage in favour of

the appellant to secure the sum of Rs. 600, the debt to be repaid within five years. On the 6th December, 1939, the appellant filed a suit to enforce

the mortgage. On the 6th June, 1940, the first respondent, who is the eldest member and therefore the manager of the family applied to the Debt

Conciliation Board of Dharmapuri for the settlement of his debts. The Court has been told that the only debt due by the estate was the debt due to

the appellant. The Board directed notice to issue to the appellant u/s 10 (1) of the Act. He was duly served but he failed to file the statement

required by that sub-section. Consequently, on the 5th May, 1940, the Board passed an order under Sub-section (2) cancelling the debt. The sub-

section says that subject to the provisions of Sub-section (3) a debt of which a statement is not submitted to the Board in compliance with the

provisions of Sub-section (1) shall be deemed ""for all purposes and all occasions to have been duly discharged."" Sub-section (3) allows a creditor

to apply to the Board or a Civil Court to revive the debt and the Board or the Civil Court can pass such an order if it is satisfied that the creditor

had no knowledge of the publication of the notice or that for some other sufficient reason he was unable to submit the statement. The time allowed

for an application under Sub-section (3) is two months after the creditor became aware of the proceedings taken under the section. The appellant

applied under Sub-section (3) to the District Munsiff of Dharmapuri, in whose Court the mortgage suit was filed, for an order under Sub-section

(3), but the application was filed out of time and therefore was dismissed. The same day the District Munsiff dismissed the appellant''s suit. The

decision of the District Munsiff was concurred in by the District Judge of Salem on appeal. The present appeal is from the decision of the District

Judge.

It is not disputed that the Debt Conciliation Board had power in the circumstances to pass an order under Sub-section (2) of Section 10, but it

is said that the fact that it did pass such an order did not preclude the District Munsiff from proceeding with the suit. It is said that the effect of

Section 19 is only to bar the institution of a suit during the pendency of an application before a Debt Conciliation Board and does not apply to a

case where a suit has been instituted before the application to the Board. So far as is relevant to this case the section says that no Civil Court shall

entertain a suit in respect of the recovery of a debt which has been deemed to have been duly discharged under Sub-section (2) of Section 10,

except a debt which is revived under Sub-section (3) of that section. Emphasis is laid on the word "" entertain."" Assuming that this word should be

given the meaning suggested by the learned advocate for the appellant, this would not help his client. Section 25 says that when an application has

been made to a Board u/s 4, a suit or other proceedings then pending before a Civil Court in respect of a debt for the settlement of which

application has been made shall not. be proceeded with until the Board has dismissed the application. Therefore when the application for the

conciliation of the debt was made by the first respondent the suit could not be proceeded with until the Board had dismissed the application.

Section 17 requires the Board to dismiss an application if no amicable settlement is arrived at within twelve months from the date of the application.

When an application is dismissed the Court, can, of course, proceed with the suit, but then it must have regard to an order passed under Sub-

section (2) of Section 10. That sub-section is very emphatic. When there is an order under it the debt is discharged for all purposes and all

occasions.

The learned advocate for the appellant says that the dismissal of the suit was wrong so far as it concerned respondents 2 to 5. This question was

not raised in the Courts below, nor was it raised in the memorandum of appeal to this Court. We hold that this question cannot be raised now. It is

a mere after-thought and to allow it to be raised would mean remanding the suit to the trial Court to take further evidence. The respondents

maintain that the application was made by the first respondent on behalf of the joint family of which he was the manager.

For the reasons indicated the appeal will be dismissed with costs.