Rajammal vs G. Viswanatha Ayyar and Others

S. Ramachandra Ayyar, C.J.—The first of the two questions that fall for determination in this second appeal concerns the interpretation of

Section 4(h) of the Madras Agriculturists'' Relief Act, 1938 (hereinafter referred to as the Act).

One Kasturi Ayyar who had an othi right over the suit property created a sub-mortgage with possession over the properly on 23rd May 1883,

in favour of one, Dharmalingam Pillai to secure a loan of Rs. 175. The mortgage was redeemable after three years. The sub-mortgagor could not

however pay up the money during his lifetime. His sons who succeeded him received a further sum of rupees twenty-five from Dharmalingam and

on 10th August 1891, executed exhibit A-2, a fresh othi (sub-mortgage) for a period of one hundred years. The sub-mortgagee''s rights came to

be subsequently assigned to one Govindammal, the predecessor-in-title of the Appellant. That lady was in enjoyment of the mortgage properties

on 1st October 1937. It has now been found--and that finding has not been challenged before us--that the property owned by Govindammal on

that date inclusive of her rights under exhibit A-2 did not exceed the sum of rupees six thousands.

The Respondents who are the descendants of the sub-mortgagor, claiming to be agriculturists, instituted the suit out of which this second appeal

arises for redemption of the sub-mortgage. It will be noticed that if the terms of the mortgage document were to prevail, the suit would be

premature as redemption can be claimed only in the year 1991 A.D. The Respondents tried to get over that difficulty on two grounds: (i) that by

virtue of Section 9-A(2) of the Act they would be entitled to redeem even before the period fixed in the document had expired; and (ii) that the

period of hundred years fixed in the document would be a clog on the equity of redemption and, therefore, would not avail against the mortgagors

while redeeming the property at any time within the period of limitation, and that as in the instant case there had been an acknowledgment by the

mortgagee of the mortgagor''s right, the claim to redemption would be well founded. The trial Court dismissed the suit finding both the points

against the Respondents. On appeal, the learned Subordinate Judge of Thanjavur held that the Respondents would, by virtue of Section 9-A of the

Act, be entitled to redeem even before the time prescribed under the document had arrived although the debt was one which was owned on 1st

October 1937, by a woman who had less than rupees six thousand as her property; in his view Section 4(h) would not have the effect of

disentitling the agriculturist mortgagor of his right to redeem but would only prevent the scaling down of the debt. On the other question, namely,

that relating to the clog on the equity of redemption, he negatived the Respondents'' case by holding that the period fixed for redemption disclosed

on the fact of it an unfair bargain, yet as there was no plea or issue in the case as to the unconscionable nature of the transaction evidenced by the

mortgage, the term as to redemption could not be held to be a clog. On the basis of his finding on the former question, the learned Subordinate

Judge passed a decree for redemption on payment of a sum of rupees two hundred.

The substantial contention that is urged on behalf of the Appellant before us is that the suit for redemption is premature, because Section 9-A

which permits an agriculturist debtor to claim redemption even before the period stipulated under the document had arrived, will not be applicable

to this case, as Govindammal, the creditor at the relevant period of time, did not own property in excess of rupees six thousand. For a due

consideration of that question it is necessary to set out the relevant provisions of the Act. Section 4(h) reads:

Nothing in this Act shall affect debts and liabilities of an agriculturist falling under the following heads:

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(h) any debt or debts due to a woman on the 1st October 1937 provided that the value of the property owned by her on that date, including the

principal amount of the debt or debts so due, did not exceed six thousand rupees.

Section 9-A reads:

(i) This section applies to all mortgages executed at any time before the 30th September 1947 and by virtue of which the mortgagee is in

possession of the property mortgaged to him or any portion thereof--

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(2) The mortgagor shall be entitled to redeem the whole of the property mortgaged, notwithstanding that the time, if any, fixed in the mortgage

deed for redeeming the mortgage has not arrived.

The learned Subordinate Judge, as we stated earlier, has held that as in terms Section 4(h) says that the Act will not affect debts and liabilities

due to a woman of limited means its effect will only be to prevent the scaling down of the debt and not to affect the other rights of the agriculturist

debtor and, therefore, the right to redeem before the period conferred by Section 9-A(2) will not be affected, the only effect of the exemption u/s

4(h) being to save the mortgage amount from the sealing down provisions contained in the various sub-clauses of Section 9-A. This construction

overlooks the provisions of Section 4 which exempts from the operation of the Act the debts and liabilities specified in that section. The substantial

relief claimed in the present case, namely, redemption even before the time for it had arrived is undoubtedly based on Section 9-A(2). When once

it is conceded that Section 4(h) will apply to the present case, even that relief would not be available to the mortgagor. Section 4 lays down several

categories of debts due by an agriculturist which would not be affected by any of the provisions of the Act. To limit the application of that section

by holding that it only prevents the operation of the scaling down provisions will be to ignore the very general language in which the exemption is

granted.

But Mr. T.R. Venkataraman, appearing for the Respondents, has tried to support the decree of the lower Court on another ground altogether

by contending that the Appellant would not be entitled to invoke the benefit of the exemption from the Act for the reason that the mortgage debt

could not be held to be due on 1st October 1937, it being payable only in the year 1993, and that, therefore, the case would not come within

Section 4(h). Learned Counsel contends that the words ''debt due to a woman on 1st October 1937, would cover only cases of debts exigible or

which become payable by that date and that as the suit mortgage claim was not payable on that date, the exemption will not apply. Support for this

contention has been sought in the decision of this Court in Ramanathan v. Ramanathan ILR (1960) Mad. 97 (F.B.), where a Bench to which one

of us was a party, held while construing the expression debt payable at the commencement of the Act occurring in Section 19(2) of the Act, that it

applied only to cases where the debt had become exigible by that date. That decision was concerned with the interpretation of the term payable.

Even so, the view expressed has not found acceptance with the Full Bench of this Court, the decision of which has been reported in Narayanan v.

Annamalai ILR (1961) Mad. 531 (F.B.). It was held there that the term debt payable should be construed as a debt owing by an agriculturist on

the concerned date irrespective of the fact whether the debt had become exigible or not. But learned Counsel has tried to convince us that the

decision of the Pull Bench requires reconsideration particularly in the light of the observations contained in the judgment of the Supreme Court in

Shanti Prasad Jain Vs. The Director of Enforcement, , where Venkatarama Ayyar, J., pointed out the distinction between a debt due and a

contingent debt, which according to the learned Judge, was not a debt at all, and observed at page 326:

In its ordinary as well as its legal sense, a debt is a sum of money payable under an existing obligation. It may be payable forthwith, solvendum in

presenti , then it is a debt ''due''; or it may be payable at a future date, solvendum futuro ; then it is a debt ''accruing''. But in either case it is a debt.

But a contingent debt has no present existence, because it is payable only when the contingency happens, and ex-hypothesi that may or may not

happen.

Founding himself on this statement of the law, learned Counsel contends that if the Legislature had intended that the word debt due in Section

4(h) of the Act should include a debt which had not yet become payable, it would have used more appropriate words as indicated in the above

passage by stating whether due or accrued, and in the absence of any such words, the phrase due on 1st October 1937, should be construed as

equivalent to payable or exigible on that date. We do not consider it necessary for the purposes of this case to examine whether the judgment of

the Full Bench in Narayanan v. Annamalai ILR (1961) Mad. 531 (F.B.), requires reconsideration or not. It is an accepted rule of construction of

statutes that in order to arrive at the true meaning of any particular phrase, it has to be read in the light of its context and the subject-matter dealt

with by the statute. After all, the fundamental rule of construction is to ascertain the intention of the Legislature. To ascertain the meaning intended,

there will be no surer guide than the object which the Legislature intended to achieve by the use of the words.

Let us now proceed to consider the meaning of the word in the light of the object of the section. The word due has more than one meaning. In

the Dictionary of English Law by Earl Jowitt, the word due has been defined as:

Anything owing; that which one contracts to pay or perform to another; that which law or justice requires to be paid or done. As applied to sum of

money ''due'' means either that it is owing or that it is payable; in other words, it may mean that the debt is payable at once or at a future time. It is

a question of construction which of these two meanings the word ''due bears in a given case''.

In Venkatakrishna High School v. Rangaswami ILR (1961) Mad. 398, one of us (Anantanarayanan, J.), sitting alone had to consider the

meaning of the expression due while construing explanation II(b) to Section 2 of Madras Act I of 1955. On a consideration of the relevant

authorities, it was held that the word was capable of two meanings, namely, payable either immediately or in future, and that in each case the word

had to be interpreted in the light of the object of the enactment in question.

It will be useful for the present purpose to refer to one authority cited therein, namely, United States v. State Bank of North Corolina (1882)

30.U.S. S.C.R. 28, where Story, J., said:

The whole difficulty arises from the different senses in which the term ''due'' is used. It is sometimes used to express the mere state of indebtment,

and then is an equivalent to owed or owing. And it is sometimes used to express the fact that the debt has become payable.

The contention on behalf of the Respondents is that whatever be the meaning of the word due, when that word is used in the context of a

specified time it can only mean payable by that time and that when Section 4(h) says debt due to a woman on 1st October 1937, it must

necessarily mean debt payable to that woman, on that date. We are, however, unable to agree with that contention. As we just now indicated, the

word itself being of wide import, we must look at the object of provision to ascertain the meaning which is intended by the Legislature in that

section. The object of the Act is to give relief to indebted agriculturists by scaling down the debts payable by them. The Legislature evidently

realised that in giving relief to agriculturists it should not be unjust to creditors who were poor. The object of Section 4(h) is to protect women of

slender means from the consequence of the drastic provisions of the Act. To achieve that object it is necessary that a definite date would have to

be fixed for the purpose of ascertaining the status of the woman creditor concerned, as otherwise there would be practical difficulties in

implementing the provision in the statute. Let us illustrate it by an example. Suppose a woman who has lent money to an agriculturist is possessed

of considerable means she should not be enabled to take advantage of the exemption provided by Section 4(h) of the Act by simply denuding

herself of her properties and thereafter suing for the debt in its entirety. The Legislature, therefore, provided that the qualification of the woman to

obtain exemption from the provisions of the Act must exist on 1st October 1937, that is, on the date when the bill which ultimately became the Act

was published. The distinction contemplated by Section 4(h) of the Act is, therefore, not between a debt exigible and one that is not so exigible,

but between women who had less than rupees six thousand worth of property on 1st October 1937, and those that acquired that qualification

subsequently. That this is so is made clear by the subsequent parts of the same section which fixes a ceiling on other property as on that date to

obtain that exemption. That being the object, the word due should necessarily have the wider meaning, namely, debts which were payable on that

date and debts which became subsequently payable. In other words Section 4(h) defines the category of women entitled to the exemption under

the Act, that is, those who owned property worth less than rupees six thousand on 1st October 1937, and those who did not. We are, therefore,

of opinion that notwithstanding the fact that the suit mortgage had not become payable on 1st October 1937, it was still a debt due by an

agriculturist to a woman coming within Section 4(h) of the Act and, therefore, Section 9-A(2) will not apply to the case.

Mr. Venkataraman next contended that the clauses in the mortgage document fixing the period of redemption as one hundred years amounted

to a clog on redemption and that the mortgagor would not be bound by it. We were at first doubtful whether even if the contention were to be

accepted, the suit having been filed more than sixty years after the date of the mortgage, would not be barred by limitation under Article 148 of the

Limitation Act. But learned Counsel was able to point out certain acknowledgments made during the period--this was not denied on behalf of the

Appellant--which would have the effect of keeping alive the claim for redemption. It is fairly well settled that a long term for redemption by itself

cannot amount to a clog. But it will be a clog if the circumstances attending the execution of the document show that the bargain as to the term was

unfair as between the parties. Recently the Supreme Court, had to consider this question in Seth Ganga Dhar Vs. Shankar Lal and Others, in

respect of a mortgage which stipulated a period of eighty-five years for redemption. Referring to the nature of the Court''s jurisdiction to relieve

against terms which prevent a mortgagor from redeeming property, the Court observed at page 517:

The reason then justifying the Court''s power to relieve a mortgager from the effects of his bargain is its want of conscience. Putting it in more

familiar language the Court''s jurisdiction to relieve a mortgagor from his bargain depends on whether it was obtained by taking advantages of any

difficulty or embarrassment that he might have been in when he borrowed the moneys on the mortgage. Was the mortgagor oppressed? Was he

imposed upon? If he was, then he may be entitled to relief.

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First then, does the length of the term--and in this case it is long enough being eighty-five years--itself lead to the conclusion that it was an

oppressive term? In our view, it does not do so. It is not necessary for us to go so far as to say that the length of the term of the mortgage can

never by itself show that the bargain was oppressive. We do not desire to say anything on that question in this case. We think it enough to say that

we have nothing here to show that the length of the term was in any way disadvantageous to the mortgagor. It is quite conceivable that it was to his

advantage.

That the real point for consideration of the question whether a provision for a long period of redemption will amount to a clog on the right of

redemption depends on the circumstances of each case has also been held in Saleh Raj v. Chandan Mal ILR (1960) Raj. 88. In that case, the term

agreed was ninety-nine years: that by itself was not considered as so unreasonable as to amount to a clog on the equity of redemption.

Taking the facts of the present ease, there can be little doubt that the term for redemption must have been fixed at the instance of the

mortgagee, he taking advantage of the position of the mortgagor. There was no evident advantage to the mortgager himself by the long period

fixed. The learned Subordinate Judge realised this and held that the term was prima facie unreasonable and unconscionable. The earlier mortgage

was for rupees one hundred and seventy-five. The mortgagor had died and his son could not pay up the money. A further sum of rupees twenty-

five was given and exhibit A-2 was secured by the mortgagee which stipulated a period of one hundred years for redemption. It will be noticed

that the period fixed in the earlier mortgage was only three years. The learned Subordinate Judge however in a way misdirected himself at the later

stages of his judgment. He found that there was no plea or evidence of malpractice on the part of the mortgagee, and that having regard to the fact

that for sixty-nine years there had been no attempt on the part of the mortgagor to redeem the term as to time should be regarded as not amounting

to clog. We are afraid there is a confusion in this. If the transaction was vitiated by any malpractice on the part of the mortgagee, the transaction

itself would have been avoided. But that is not the case here where the transaction is accepted. Only one of the terms of the bargain which

unreasonably prevents the mortgagor from obtaining redemption is attacked as mounting to a clog. The question relating to clog on redemption

through not specifically referred to in the pleadings was covered by the additional issue in the case and was allowed to be raised and argued in

both the Courts. That the mortgagor did not challenge the mortgage for a long period of time might not be conclusive on that question. What the

Court has to see in such a case is whether the term is oppressive. Inaction for a long period on the part of the mortgagor will be one circumstance.

Having regard to the situation in which the parties were placed, in the present case that question is capable of only one answer, namely, in the

affirmative. The mortgagor will have to be relieved against that term. The decree passed by the lower Court will be sustained on this ground. The

appeal fails and is dismissed. There will be no order as to costs.

And this appeal having been set down this day for being mentioned the Court made the following Order:

The parties have now filed a joint memo as to the working out of the rights as on this date. That will be incorporated as our final order in the

appeal.