Rajammal vs Janaki Ammal and Others

G. Ramanujam, J.—The first defendant in O.S. No. 299 of 1958 on the file of the Court of the District Munsif of Pudukottai is the appellant.

One Venu Ammal had executed a mortgage on 2nd September, 1945 in favour of one Krishnamurthi, whose legal representative, is the first

respondent. After the death of Venu Ammal the first respondent filed a suit on the said mortgage against the daughters of the said Venu Ammal, for

recovery of the mortgage amount. Defendants 1 and 2, the daughters of the mortgagor, remained ex parte and a final decree in the suit was passed

on 6th January, 1972 for a sum of Rs. 1,947. After the passing of the said final decree, the first defendant, one of the daughters filed ah application

I.A. No. 1369 of 1974 in the said suit seeking an amendment of the decree on the ground that she is entitled to the benefits of the Tamil Nadu Act

(IV of 1938 as amended by the Act VIII of 1973). The said application was resisted by the first respondent, decree-holder, contending that the

appellant first defendant is not an agriculturist entitled to the benefits of the said Act IV of 1938 and therefore the mortgage decree cannot be

scaled down under the provisions of the said Act.

The trial Court took the view that as the suit was filed against the two daughters of the mortgagor, Venu Ammal, after her death and the estate

of Venu Ammal in the hands of the appellant is alone sought to be proceeded against, the daughters of Venu Ammal cannot claim the benefits of

the said Act, and that as the estate of the deceased Venu Ammal alone is sought to be made liable for payment of the decree the provisions of Act

IV of 1908 will be inapplicable to such a case. In support of the said view, the trial Court relied upon the decision of a Division Bench of this Court

in N.M.P.L. Palaniappa Chettiar Estate Vs. V.N.S. Ramaswami Naidu and Others, . The application for scaling down was therefore rejected.

There was an appeal by the first defendant to the lower appellate Court. The lower appellate Court also relying on the said decision held that

there is no provision in the said Act, under which an impersonal entity as an estate of a deceased person can claim relief that the estate of the

deceased is not a person with in the meaning of the definition u/s 3 (1) of the Act, that there is no question of an estate being an agriculturist as

defined in the said Act and that therefore, the decision of the trial Court did not call for any interference.

In this appeal, the learned Counsel for the appellant contends that both the Courts below are in error in thinking that the claim put forward by

the appellant for scaling down of the decree debt under the provisions of Act IV of 1938 is not sustainable in view of the decision of this Court in

N.M.P.L. Palaniappa Chettiar Estate Vs. V.N.S. Ramaswami Naidu and Others, , that the said decision is inapplicable to the facts of this case,

that the correct legal position is that the appellant who is the legal representative of the deceaed Venu Ammal and who is sought to by made liable

for the decree-debt due by Venu Ammal is entitled to claim the benefits of that Act and that the reasoning of the Courts below that since the

mortgage debt is sought to be recovered from the estate of Venu Ammal the appellant who is representing the said estate cannot claim the benefits

under the said Act cannot be sustained.

The learned Counsel for the appellant relies on the decision of the Division Bench of this Court in Kona Hasan Fathima Bivi (deceased) and

Others Vs. Muhammad Muhaideen Nachiar and Others, , as being directly in point and submits that the said decision is a clear authority for the

proposition that a legal representative of a debtor can claim the benefits of Act (IV of 1908), if the debt is sought to be recovered from such legal

representative. In this case, Wadsworth and Patanjali Sastri, JJ. directly considered the question, as to whether the heirs of the debtor can seek

scaling down of a decree debt u/s 8 of the Tamil Nadu Act (IV of 1938). There a promissory note had been executed by a person who was not

an agriculturist within the meaning of the Act, on 6th April, 1920. A decree thereon had been obtained on 1st November, 1930 against the

promisor. The judgment-debtor died on 27th September, 1935. Thereafter, the heirs of judgment-debtor were brought on record as his legal

representatives in the execution proceedings. The legal representatives so brought on record applied for scaling down the decree debt on the

ground that they were agriculturists. This was opposed by the decree-holder on the ground that the judgment-debtor was not an agriculturist within

the meaning of the Act and that as the debt could not have been scaled down if he were alive and had applied for relief, the legal representatives

who merely represent his estate and were liable to pay the debts out of the assets in their hands were in no better position and could claim no relief

under the Act, even though they may be agriculturists. This contention of the decree-holder found favour, with the Courts below. But when the

matter was taken to this Court the Division Bench expressed that the avowed purpose of the Act being to enable agriculturists to retain their

property and prevent such property passing into the hands of creditors or execution purchasers, it would largely defeat such purpose, if the benefit

of the Act were to be denied to the large class of persons who come under liability by devolution and who are themselves agriculturists as defined

by the Act, and therefore the legal representatives were entitled to claim relief under the Act as agriculturists, although the original debtor whose

liability they have inherited was himself not an agriculturist. This decision directly deals with a case of a legal representative of the original debtor

and the facts in that case are on all fours with the facts of the case on hand. In the said decision the learned Judges have referred to with approval

an earlier Bench decision of this Court, Perianna Goundan Vs. Sellappa Goundan and Others, , wherein it has been held that the right to claim

relief under the Tamil Nadu Act (IV of 1938) was not confined to the person who actually contracted the debt but who available equally to

persons who were liable on account of the possession of property and that accordingly the liability of a purchaser of the equity of redemption in a

portion of the mortgaged property was a debt liable to be scaled down under the provisions of the Act. This decision in Perianna Goundan Vs.

Sellappa Goundan and Others, , was approved by the Supreme Court in Cheruvu Nageswaraswami Vs. Rajah Vadrevu Viswasundara Rao and

Others, . In that case the question before the Supreme Court was whether the purchaser of an equity of redemption could claim the privileges

under the Tamil Nadu Act IV of 1938. The Supreme Court expressed the view at page 256 as follows:

The right to claim relief as is well settled by decisions of the Madras High Court Perianna Goundan Vs. Sellappa Goundan and Others, is not

confined to the person who originally contracted the debt, but is available to his legal representatives and assigns as well; nor is it necessary that the

applicant should be personally liable for the debt. The liability of a purchaser of the equity of redemption to pay the mortgage debt undoubtedly

arises on the date of his purchase; but the debt itself which has its origin in the mortgage bond did exist from before his purchase, and if it was

payable by an agriculturist at the relevant date, the purchaser could certainly claim the privileges of the Act if he himself was an agriculturist at the

date of his application.

It can therefore be taken to be well established that the benefit conferred by the Act will be available not only to the original debtor but also to his

legal representatives and assigns and that it is not necessary that the legal representatives and assigns should be personally liable for the debt.

In Palani Goundan Vs. Peria Goundan, , Wadsworth and Patanjali Sastri, JJ. had earlier dealt with a case of a purchaser of equity of

redemption at a salt in execution of a money decree against the mortgagors, claiming to have the mortgage decree amended u/s 19 of the Tamil

Nadu Act IV of 1938. It was contended that the application u/s 19 for scaling down the mortgage decree is not maintainable as the purchaser of

equity of redemption will not come under the definition of a judgment-debtor within the meaning of Section 19. Dealing with this contention the

Bench expressed the view that the definition of debt in Section 3 (iii) includes debts payable under a decree or order of Count, that the liability of

the purchaser of equity of redemption subject to the mortgage is a debt within the meaning of the Act, that the procedure provided in a statute for

enforcement of the substantive rights conferred thereby should be construed as far as possible, so as to give effect to and not to nullify those rights,

and that therefore there is no obvious reason why the term judgment-debtor should not be understood as including a person whose liability is a

debt as defined by the Act, more especially as that definition includes a judgment-debt. The learned Judges referred to the decision in Panduranga

Mudaliar v. Vythilinga Reddi (1907) 17 M.L.J. 417 : ILR Mad. 537 wherein it has been observed:

We think however that the word ''judgment-debtor'' in Section 258 should be construed as including those who claim through him or in his right.

To hold otherwise would lead to obvious hardships which we cannot think were contemplated.

The learned Judges referred to a contrary decision of Horwill, J., in Ganapathi Bhatta Vs. A.M.L. D''Sowza and Others, , holding that the word

''judgment-debtor'' u/s 19 must be understood in the sense defined in the Civil Procedure Code, and that therefore a purchaser of the equity of

redemption from a Receiver in the insolvency of a judgment-debtor was not entitled to apply under that section, and specifically dissented.

Thus it appears to be well settled that the legal representatives representing the estate of the deceased judgment-debtor, though not proceeded

against personally can claim the benefits of the Tamil Nadu Act No. IV of 1938 if they are agriculturists. The decision in N.M.P.L. Palaniappa

Chettiar Estate Vs. V.N.S. Ramaswami Naidu and Others, relied on by the Courts below, deals with the case of an executor who is sought to be

made liable for a decree debt as representing the estate of deceased and therefore it is clearly distinguishable. The said decision gives two reasons

as to why the executor in that case cannot claim the benefits of Act IV of 1938. One is that the decree is not sought to be executed against the

executor personally and the decree is only against the estate in the hands of the executor and there is no provision in the Act under which such an

impersonal entity as an estate can claim the relief. The other reason given is that the estate being a charitable trust has been specifically and

expressly excluded by the terms of Section 3 (1) of the Act. In the circumstances of the case, I am clearly of the view that the decisions in Kona

Hasan Fathima Bivi (deceased) and Others Vs. Muhammad Muhaideen Nachiar and Others, . and Cheruvu Nageswaraswami Vs. Rajah Vadrevu

Viswasundara Rao and Others, . will clearly support the case of the appellant, and the decision in N.M.P.L. Palaniappa Chettiar Estate Vs.

V.N.S. Ramaswami Naidu and Others, has no application.

Now that this Court has held that the appellant is entitled to claim the benefits, under Act IV of 1938, it is to be seen whether she is an

agriculturist. Though the appellant asserted that she is an agriculturist and produced Exhibits A-1 to A-3, patta and kist receipts, to show that she is

in fact an agriculturist, the Courts below have not considered those documents and given a finding on that question. That it perhaps due to the

reason that they were of the view that the appellant is, not entitled to claim the benefits of the Act being a legal representative. The lower appellate

Court is therefore directed to consider that question on the basis of the material already on record and dispose of the appeal afresh in the light of

the observations made by this Court. The C.M.S.A. is therefore allowed and remitted as indicated above. There will be no order as to costs.