1. Mortgage decree — Application for scaling down debt under Section 19, Madras Agriculturists Relief Act — Impact of 1948 Amending Act on previously rejected claims. (Para 1 , 3 )
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1963 Supreme(SC) 64
SUPREME COURT OF INDIA
A.K.Sarkar : M.Hidayatullah : N.Rajagopala Ayyangar : S.K.Das
Lakshmi Achi
Versus
T.V.V.Kailasa Thevar
Case No. : 617 of 1960
Date of Decision : 3/7/63
Advocates Appeared: Agrawal S.C. : Garg R.K. : Gopalakrishnan G. : Iyer R.Ganapathy : Ramamurthi M.K. : Sastri A.V.Viswanatha : Singh D.P.
Advocates:
A.V.VISHWANATHA SASTRI, D.P.Singh, G.GOPALAKRISHNAN, M.K.RAMAMURTHY, R.Ganapathy Iyer, R.K.GARG, S.C.AGRAWAL
A.V.VISHWANATHA SASTRI, D.P.Singh, G.GOPALAKRISHNAN, M.K.RAMAMURTHY, R.Ganapathy Iyer, R.K.GARG, S.C.AGRAWAL
An appellate decree supersedes the trial court's decree. A new right granted by an amending statute to agriculturists for scaling down decretal debts, provided the decree is not fully satisfied, is a fresh right not barred by the principle of res judicata.
Headnote:(A) Madras Agriculturists Relief Act, 1938 - Section 19 - Madras Agriculturists Relief (Amendment) Act, 1948 - Sections 16 and 19 - Scaling down of decretal debt - Applicability of amending act to decrees not fully satisfied - Where a decree for repayment of debt has not been executed or satisfied in full before the commencement of the amending act, an agriculturist debtor is entitled to claim relief under the act, provided they establish their status as an agriculturist. (Paras 10, 11)
(B) Merger of Decrees - Where an appeal is preferred against a preliminary decree, the decree of the appellate court becomes the operative decree and the lower court's decree merges into it. The time for applying for a final decree runs from the date of the appellate decree. (Paras 9, 10)
(C) Res Judicata - A new right created by an amending statute in favour of a specific class of debtors cannot be defeated by the principle of res judicata, even if previous applications for relief under the principal act were rejected. (Para 10)
Facts of the case:
In a mortgage suit, a preliminary and final decree were passed by the trial court before the commencement of the principal act. On appeal, the appellate court passed a preliminary decree scaling down the debt for some defendants who were agriculturists, but not for one defendant who had not applied for such relief. A final decree was subsequently passed and put into execution. After an amending act came into force, the defendant who was previously denied relief applied again to scale down the decretal debt. The trial court dismissed the application on the grounds that the original decrees were passed before the principal act and that the claim was barred by res judicata. The High Court set aside this order, holding that the defendant was entitled to the benefit of the amending act.
Findings of Court:
The operative decree in the case was the preliminary decree passed by the appellate court and the subsequent final decree, both of which occurred after the commencement of the principal act. Since the final decree had not been satisfied in full before the commencement of the amending act, the defendant was entitled to claim the benefit of the act.
Issues: Whether the operative decree was passed before or after the commencement of the principal act, and whether the amending act created a new right that overrides previous judicial rejections based on res judicata.
Ratio Decidendi: The appellate decree supersedes the trial court's decree; therefore, the operative decree was passed after the principal act's commencement. Section 16(iii) of the amending act applies to decrees not fully satisfied before its commencement, granting a new statutory right to agriculturists that is not barred by the principle of res judicata.
Result: Appeal dismissed with costs.
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2. Whether a decree passed before the Principal Act precludes relief under the Amending Act and whether previous rejections of relief operate as res judicata. (Para 6 , 8 )
3. The appellate decree supersedes the trial court's decree; the 1948 Amending Act creates a new statutory right for agriculturists where decrees remain unsatisfied. (Para 9 , 10 , 11 )
4. A decree of an appellate court merges the lower court's decree; subsequent amending legislation creating new rights for a specific class overrides previous adjudications. (Para 10 )
5. Appeal dismissed; respondent entitled to apply for scaling down the decree under the Amending Act, subject to proving agriculturist status. (Para 12 )
6. What is the effect of an appellate decree on a preliminary decree passed by a lower court in mortgage suits?
The appellate decree is the operative order and the decree of the lower court merges into it. The time for applying for a final decree runs from the date of the appellate decree. (Para 9 , 10 )
7. Under what conditions does Section 16(iii) of the Madras Agriculturists Relief (Amendment) Act, 1948 apply to a decree?
It applies to suits and proceedings where the decree or order passed had not been executed or satisfied in full before the commencement of the Amending Act on January 25, 1949. (Para 10 , 11 )
8. Does the principle of res judicata bar a debtor from seeking relief under an amending act if a previous application under the principal act was rejected?
No, if the amending act creates a new right in favor of the debtor, that right cannot be defeated by the principle of res judicata based on prior rejections. (Para 10 , 11 )
S.K.DAS, J.
(1) THIS is an appeal by special leave from the judgment and order of the Madras High Court dated December 2, 1955 by which the said Court set aside the order of the learned District Judge of East Tanjore dated August 30,1950 passed on an application made by the 1st respondent herein, under s. 19 of the Madras Agriculturists Relief Act (Act IV of 1938), hereinafter called the principal Act, as amended by the Madras Agriculturists Relief (Amendment) Act of 1948 (Act XXIII of 1948). By the said order the learned District Judge dismissed the application as unsustainable in law. The High Court set aside that order on the ground that the respondents application for the scaling down of the decree passed against him should not have been dismissed in limine and the learned District Judge should have gone into the question whether the respondent was an agriculturist entitled to the benefit of the principal Act as amended in 1948.
(2) THE material facts are not very much in controversy, but this is one of those cases in which a long history must be stated for the appreciation of a very short point involved in the case. The short point involved is, whether the application made by the 1st respondent herein to the District Judge of East Tanjore in O. S. No. 30 of 1934 on December 6, 1950 was unsustainable in law.
(3) WE may now state the long history. The appellants before us are the representatives of the original plaintiffs who as mortgagees instituted a suit (being O. S. No. 30 of 1934) in the court of the District Judge, East Tanjore for the enforcement of a mortgage against respondent No. 1, who was defendant No. 1 in the suit, and six other persons. The mortgage bond upon which the suit was brought was executed by defendant No. 1 for himself and his minor undivided brother, defendant No. 2, and also as authorised agent on behalf of defendants 3 to 7, who were interested in a joint family business. The suit was contested by all the defendants, except defendant No. 1 against whom it proceeded ex parte. A preliminary decree was passed on May 15, 1937 by which a sum of Rs. 1,08,098.00 was directed to be paid by defendant No. 1 and defendants 3 to 7, in default of which the plaintiffs were declared entitled to apply for a final decree for sale of the mortgaged property and the suit was dismissed as against defendant No. 2. Against this decree, two appeals were taken to the Madras High Court, one by defendants 3 to 7 (being Appeal No. 48 of 1938) who contended that the mortgage was not binding on them or on their shares in the joint family property and the other by the plaintiffs (being Appeal No. 248 of 1938), who challenged the propriety of the judgment of the trial Judge in so far as it dismissed their claim against defendant No. 2. During the pendency of these appeals the principal Act came into force and applications were made by defendants 2 to 7 to the High Court praying that in the event of a decree being, passed against them,.the decretal debt might be scaled down in accordance with the provisions of the principal Act. Defendant No. 1 who did not appeal at any stage of the proceedings did not make any such application. The High Court forwarded these applications to the lower court for enquiry and asked for a finding on the question whether the applicants were agriculturists and if so, to what extent the decretal dues should be scaled down. The District Judge made the necessary enqury and submitted a finding that the applicants were agriculturists and that the debt, if scaled down would amount to Rs. 49, 255.00 with interest thereon at six percent per annum from October 1, 1937 exclusive of costs. On receipt of this finding the appeals were set down for final hearing and by their judgment dated March 25, 1942 the learned Judges of the Madras High Court accepted the finding of the court below and held that defendants 2 to 7 were entitled to have the debt scaled down, but as no application ha
