Judgment

GUPTA, J. - These are two appeals by the Life insurance Corporation of India (hereinafter referred to as the Corporation) with special leave obtained from this Court against a common Judgment of the Andhra Pradesh High Court disposing of two appeals preferred by the Corporation. The appeals before the High Court arose out of two suits instituted by the Corporation. For the question that arises for determination, which we will presently state, it is not necessary to set out the facts in any great detail. One of the suits was brought in 1961 for recovery of a sum of about Rs. 17,000/-, after giving credit to the payments made by the defendants, due on a mortgage executed by the defendants in 1950 in favour of the Andhra Insurance Company of Masulipatnam. The other suit was filed in 1962 for recovery of about Rs. 45,555/- also due on a mortgage which was executed in 1952 by the defendants of this suit in favour of the Nagpur Pioneer Insurance Company Ltd., Bombay. Thus in both cases the loans were incurred long before the Corporation was established on September 1, 1956 under the Life Insurance Corporation Act, 1956. In both suits the mortgagors claimed that the debt should be scaled down in accordance with the provisions of the Madras Agriculturists Relief Act (Madras Act IV of 1938) (hereinafter referred to as the Madras Act). It is not disputed in either case that the mortgagors are agriculturists. The trial Court upheld their claim, scaled down the debts and decreed the suits accordingly. The High Court on appeal affirmed the decision. The claim was resisted by the Corporation relying on the provisions of Sec. 4(e) of the Madras Act which is as follows:

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

X X X

(e) any liability in respect of any sum due to any Co-operative Society, including a land mortgage bank, registered or deemed to be registered under the Madras Co-operative. Societies Act. 1932 or any debt due to any Corporation formed in pursuance of an Act of Parliament (of the United Kingdom) or of any special Indian Law of Royal Charter or Letters Patent;"

The question arising for decision in the appeals is whether in respect of the debts sought to be recovered, the application of Madras Act is barred Sec. 4 (e) of that Act.

2. Section 4 of the Madras Act keeps certain debts and liabilities out of the reach of the Act including any debt due to any Corporation formed in pursuance of "any special Indian law". There is no dispute that the Corporation established under the Life Insurance Corporation Act, 1956 is a Corporation as contemplated in Sec. 4 (e) It is contended on behalf of the appellant that the debts in question in these cases would not therefore be affected by anything contained in the Madras Act. This contention was not accepted either by the trial Court or the High Court who held that the debts were due originally not to the Corporation but to the insures whose life insurance business was taken over by the Corporation, and because of the genesis of the debts, Sec. 4 (e) of the Madras Act was not attracted.

3. It will be necessary at this stage of refer to certain provisions of the Life Insurance Corporation Act. 1956. It is an Act "to provide for the notionalisation of life insurance business in India by transferring all such business to a Corporation established for the purpose and to provide for the regulation and control of the business of the Corporation and for matters connected therewith or incidental thereto". Sub-section (1) of Sec. 7 of the act provides that on the appointed day all the assets and liabilities appertaining to the life insurance business of all insurers shall be transferred to and vested in the Corporation. Appointed day has been defined in S. 2(1) as the date on which the Corporation is established, which is September 1, 1956, Sub-section (2) of S. 7 states inter alia that the liabilities mentioned in sub-s (1) "shall