P. A. CHOUDARY, J.

( 1 ) THIS Second Appeal has been postrd before this Division Bench on an order of reference made by chennakesav Reddi J doubting the correctness of a Judgment of Gangadhara Rao J. , reported in Union Bank of india vs. Koteswara Rao which held, that a debt due to the Union Bank: by an agriculturist, cannot be scaled down under Section 13 of the Madras Argiculturists Debt Relief Act (Madras Act no. IV of 1938) herein after referred to as the Madras Act .

( 2 ) THE facts in this second appea are few and are also simple. But the questions of law that call for our response are fairly complicated and vastly important both to the agricultural community and the Banking Community!

( 3 ) THE two defendants are agriculturists. For the purpose of carrying on their agricultural operations they borrowed on 12-6-1973 from the indian Bank, Alamuru Branch on a promissory note a sum of Rs. 2,100/ -. The defendants undertook to pay the indian Bank interest at the rate of 3 1/2% per annum over and above the offcial rate of interest fixed by the Reserve bank of India, with quarterly rests, but subject to a condition that the minimum rate of interest payable by them should not be less than 101/2 % per annum in any event. The official rate fixed by the Reserve Bank of India, however, remained fairly high and within a period of three years, the liability of the defendants-agriculturists had jumped to Rs. 3,093-65/-No wonder the defendants could not keep their promise to repay the amounts borrowed from the Indian Bank. The plaintiff-Bank has, therefore, sued the defendants on the foot of the promissory note executed by the defendants for recovery of the principal amount together with interest calculated at 31/2% per annum-over and above the Reserve bank rate with quarterly rests,

( 4 ) IF Maine s famous dictum that history of civilised societies is its history from status to contract, retained its validity today the defendants probably could not have afford to plead any thing substantial in extenuation of their failure to repay the debt as undertaken by them. But law, acting in refutation of the false assumption of equality of bargaining power of the contracting parties, seeks to relieve the the agriculturists from the burdens of their debts. In the year 1938, the madras Provincial Legislature has, therefore, enacted the Madras Agriculturists Debt Relief Act. Sec. 13 of that act reads thus:-"in any proceeding for recovery of a debt the Court shall scale down all interest, due to any debt incurred by an agriculturist after the commencement of this Act, so as not to exceed a sum calculated at 5 1/2 % per annum, simple interest, that is to say, one pie per rupee per mensum simple interest or one anna per rupee per annum simple interest. "

( 5 ) THE defendants claim that they are entitled to the protection of Section 13 of the Madras Act and that the plaintiff-bank can recover from them only such amount found due under the above promissory note calculated at the rate of 5 1/2% per annum interest while the plaintiff-bank danies the applicability of the above section 13 of the madras Act.

( 6 ) IT is not in dispute and in fact the plaintiff-bank does not deny that the defendants are agriculturists and that if section 13 of the above Act applies to this transaction between the parties, the interest on the loan advanced by the bank to the defendants should be calculated at 5 1/2% per annum only. But what is pleaded by the plaintiff- bank is that it is a bank" formed in pursuance of a special Indian Law", within the meaning of Sec. 4 (e) of the madras Act and that therefore, no debt due to such a bank can be scaled down at all as directed by Section 13 of the madras Act. For support of this contention, the plaintiff-bank relies exclusively upon Section 4 (e) of the above madras Act and claims that the debt due to it from the defendants Is outside the purview of Section 13 of the above madras Act. Section 4 (e) of the madras Act read? thus:-"

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