Judgement

HEGDE, J.: This appeal by special leave arises from the decision of Raju, J. of the Gujarat High Court in an application under Section 115 of the Code of Civil Procedure. That application was filed by respondents Nos. 1 to 3 herein. As they are the only contesting respondents in this appeal, they will hereinafter be referred to as the respondents.

2. The respondents are Bhayats and Girasdars of Dhanki village in Lakhtar Taluka of the Saurashtra region of the Gujarat State. On December 19, 1940, the respondents executed a joint usufructuary mortgage in favour of Thakker Jethalal Dosabha (the third appellant herein) and another for a sum of Rupees 17,725. The liability incurred under the mortgage was a joint liability and under the terms of the deed each of the mortgagers was liable for the entire debt due under the mortgage. Till January 25, 1950, Dhanki village was a part of the former State of Bombay. As from January 26, 1950, that village became a part of the State of Saurashtra in view of the provisions in the Provinces and States (Absorption of Enclaves) Order, 1950. Prior to that date, the Bombay Agricultural Debtors Relief Act, 1939, (Bombay Act No. XXVIII of 1939) hereinafter referred to as the Bombay Act, was in force in Dhanki village. As long back as 1945, respondent No. 2 had filed an application before the Civil Judge (Junior Division) Viramgam both on his behalf as well as on behalf of his minor cousin, the third respondent, for adjustment of their debts. At the same time, respondent No. 1 had also filed an application under the Bombay Act for adjustment of his debts. These applications were consolidated for the purpose of trial. Ultimately they were dismissed as the debts due from each of those persons were held to exceed Rs. 15,000 and that being so they could not be considered as "debtors" under the Bombay Act. In those proceedings it was further held that the debt due from the respondents under the mortgage is a joint debt and each one of them was liable for the entire debt. No appeal was preferred against that decision. At the time of the merger of Dhanki village in Saurashtra, in that State there was no statute similar to the Bombay Act. The Saurashtra Agricultural Debtors Relief Act (Act No. XXIII of 1954) came to be enacted in 1954. This Act will hereinafter be referred to as "the Act". By and large the provisions of the Act are similar to those of the Bombay Act. In 1955 the respondents again made applications before the Debt Adjustment Board for sealing down their debts under the provisions of the Act. The appellants resisted those applications principally on two grounds, viz.:

(1) The respondents cannot be considered as "debtors" under the Act as the total debts due from each of them exceeded Rs. 25,000, the limit fixed under the Act, and

(2) their applications are barred by the principles of res judicata in view of the decision given earlier under the Bombay Act.

Both the Board as well as the appellate court upheld the contentions of the appellants that the respondents were not "debtors" as defined in the Act and that their present applications were barred by the principles of res judicata, in view of the earlier decision rendered under the Bombay Act. They held that the debt due under the mortgage is a joint debt and each of the mortgagors is liable for the entire debt. They repelled the plea of the respondents that the debt in question is liable to be split up under the provisions of the Act. But the High Court reversed the above findings. It held that in computing the total debts due from the respondents each one of the mortgagors should be held to be liable only for one-third of the mortgage debt and in that event the total debt due from each of them does not exceed Rs. 25,000. It may be noted that under the Act, a person whose debts exceeded Rs. 25,000 cannot be considered as a "debtor", it is admitted that if each of the respondents is held liable for the entire mortgage debt, the debts d