High Court Of Madhya Pradesh
Shiv Dayal, C. J. and S. S. Sharma, J.
RAMKISHAN AGARWAL - Appellant
Versus
COLLECTOR, JABALPUR - Respondents
Misc. Petn. 722 Of 1976
Decided On : 09/24/1976
(2) Constitution of India - VII Schedule, List II, Entry 30 - 'agricultural indebtedness' - import of the words - Gramin Rin Vimukti Tatha Rin Sthagan Adhiniyam, 1975 (MP) - Ss. 1 and 5-A.
The State Legislature was competent to enact the M.P. Gramin Rin Vimukti Tatha Rin Sthagan Adhiniyam, 1975, which falls within Entry 30, List II of the Seventh Schedule.
The entry must be read as a whole so that the word "agricultural" must be interpreted to harmonise it with "money-lending and money-lenders". The framers of the Constitution have, by this Entry, empowered the State Legislature to relieve agriculturists of their indebtedness. Relief to agriculturists must be the true import of the expression. Irrespective of whether the indebtedness be agricultural or non-agricultural, all debts will fall within the scope of this Entry, if they are incurred by an agriculturist, whether in connection with agriculture or otherwise. AIR 1965 SC 1387, AIR 1963 SC 90, AIR 1960 SC 424, AIR 1957 SC 329 and 1961 Kerala Law Times 470 relied on. [Para 10
There was legislative competence in the Madhya Pradesh State Legislative Assembly when it enacted the Madhya Pradesh Gramin Rin Vimukti Tatha Rin Sthagan Adhiniyam, 1975. (Act No 22 of 1975) and its Amendment Act No. 29 of 1976, whereby section 5-A was enacted. [Para 18
(3) Gramin Rin Vimuki Tatha Rin Sthagan Adhiniyam, 1975 (MP) - Ss. 4, 5 and 5-A-Collector or Sub-Divisional Officer-not authorised to institute proceedings-prosecution may be launched under section 5-A.
In the absence of a special forum, it is only the civil Court which can determine such disputes. [Para 19
There is nothing in the Act which empowers either the Collector or the Sub-Divisional Officer to institute any proceeding before them to give relief under the Act; for instance, either to declare that any debt is wholly discharged or to enforce the release of any property, movable or immovable, and to put the debtor in possession thereof. No doubt, in case of such contravention as may fall within the mischief of section 5-A, the authorities may prosecute the offender-creditor. [Pera 20
(4) Gramin Rin Vimukti Tatha Rin Sthagana Adhiniyam, 1975 (MP) - S. 1 - contravenes Art. 31 (1), Constitution of India - but is saved by Article 31 (2-A).
The Act deprives moneylenders of their property within the meaning of Article 31 (1) of the Constitution.
But the petitioners are not entitled to any compensation because of clause 2 (a) of Article 31 inasmuch as they are deprived of their property (i) by authority of law; and (ii) the Act does not provide for transfer of ownership or right to possession of any property to the State or to a Corporation owned or controlled by the State. [Para 23
(5) Gramin Rin Vimukti Tatha Rin Sthagana Adhiniyam, 1975 (MP) - S. 1 - does not contravene Article 301 of the Constitution.
(6) Constitution of India - Art, 301 - scope of.
Article 301, when read in its proper context and subject to the limitations prescribed by other Articles in Part XIII, must be regarded as imposing a constitutional limitation on the legislative power of Parliament and the State Legislatures. This Article will be violated when restrictions are imposed at the frontiers of any State or at any stage, prior or subsequent. But, as is clearly seen from the provisions of the impugned Act, no such restriction or barrier has been imposed. The liquidation of any debt is no obstruction or barrier on the right of free trade, commerce and intercourse conferred by this Article. It relates to previous transactions. [Para 24
( 1 ) BY this petition under Articles 226 and 227 of the Constitution of India, the constitutional validity of the Madhya Pradesh Gramin Rin Vimukti Tatha Rin sthagan Adhiniyam, 1975 (No. 37 of 1975) has been challenged. It is contended that the different provisions of the impugned Act are ultra vires the constitution. It seeks a writ to restrain the respondents from enforcing their orders served on the petitioners through the Patwari to produce all the pledged ornaments before the Sub-divisional Officer, Jabalpur.
( 2 ) THE petitioners carry on the business of money-lending. They advance money to the members of Scheduled Castes and Scheduled Tribes, to small and marginal farmers and also to others who are not covered by the Act. It is averred in the petition that on July 18, 1976, respondents Nos. 3 and 4, who are Patwaris, approached the petitioners and told them that they were required to produce all the pledged ornaments involved in their money-lending business end the account books before the Sub-divisional Officer, Jabalpur, at Camp barela on July 25, 1976, with a view to return them. The Patwaris took their signatures on a piece of paper in token of the intimation given to them, of these orders of respondents Nos. 1 and 2 (the Collector and the S. D. O. respectively ). The Patwaris refused to supply them with a copy of the order, but told them that notices were being issued to them for production of the ornaments as per the orders of the Collector and the Sub-divisional Officer, Jabalpur.
( 3 ) THE petitioners contend that the State Government had no legislative competence to pass the impugned Act, the subject-matter of which is not covered by any of the Entries, either in List II or List III. The effect of the Act is to extinguish the debts due to the debtors enumerated in the Act and to enable such debtors to receive back their pledged movable and mortgaged immovable properties without repaying the debts, for which they pledged them as security. The impugned Act does not take into account the extent of property and the paying capacity of the debitors. It extinguishes their debts even though their properties may be worth more than the debts and they may have the capacity to discharge their debts. There is no limit on the amount of debt, which will be discharged. Thus, the petitioner's fundamental rights guaranteed under Article 19 (1) (f) and (g) and also under Article 301 of the Constitution are violated. The Act robs or deprives the petitioners of their money without anything being paid to them in return, either fully or proportionately, either immediately or by instalments, and thus infringes the rights guaranteed by Article 19 of the constitution.
( 4 ) THE object of the Act is to provide relief from indebtedness to members of the Scheduled Castes and Scheduled Tribes, small and marginal formers, landless agricultural labourers and rural artisans in rural areas. The reliefs, which the Act affords to them, except to small farmers, are contained in Section 4 of the Act, which may be summed up thus:--
(a) Every debt advanced before the commencement of the Act (including interest) payable by the persons of the above classes shall be deemed to be wholly discharged.
(b) Jurisdiction of the Civil Court is barred for the recovery of such debts.
(c) Execution and other proceedings in respect of any decree, whether for money or sale, or foreclosure, shall stand withdrawn and the property of the debtor under attachment shall forthwith be released.
(d) Every such debtor in detention in civil prison shall be released. (e) All suits and proceedings pending against such debtors shall abate.
(f) Every property pledged shall stand released in favour of such debtor and the creditor shall be bound to return the same to the debtor forthwith.
(g) Every mortgage executed by such debtor shall stand redeemed and the mortgaged property shall be released in favour of such debtor.
( 5 ) SECTION 5 provides for reliefs to smal
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