KESHAV GANASHYAM Vs. WAMAN RANGAJI

JUDGEMENT

(1.) A very interesting and important question under the Bombay Agricultural Debtors Relief Act arises 011 this revision application. The petitioner filed a suit in the Court of small Causes, Sawantwadi, to recover a debt, and the learned Judge held that the debt was extinguished under Section 15, Bombay Agricultural Debtors Relief Act and non-suited the plaintiff; and the point that has been urged before me by Mr. Walawalkar on behalf of the plaintiff is that the learned Judge was in error in preventing the plaintiff from contending that the defendant was not a debtor within the meaning of the Bombay Agricultural Debtors Relief Act and therefore the provisions of Section 15 would not apply.

(2.) IN this case an application for adjustment of debt was made by a creditor under Section 4, and on that application the Court held that the defendant was a debtor and passed an award adjusting the debts of the defendant. The defen- dant's contention before the learned Small Causes Court Judge was that inasmuch as an award has been made in his favour by the Bombay Agricultural Debtors Relief Act Court and inasmuch as the debt of the plaintiff was not included in that award, the debt is extinguished under Section 15. Mr. Walawalkar's contention is that the award made by the Bombay Agricultural Debtors Relief Act Court was not binding on him as he was not a party to that award, and therefore the adjudication before the Bombay Agricultural Debtors Relief Act Court that the defendant was a debtor was an adjudication which was not binding and conclu- sive as against him and it was open to him to challenge that finding and to ask the Court before applying Section 15 to be satisfied that the defendant was a debtor. Under Section 15, debts mentioned in that section are to be extinguished and one of the debts which is mentioned is a debt in respect of which a statement is not submitted to the Court by the creditor in compliance with the provisions of Section 14, and turning to Section 14 it provides for service of notices on debtors and creditors. Under Sub-section (1), when an application for adjustment of debts is received by a Court, a notice is to be served upon the debtor, unless the debtor is himself an applicant, and upon every creditor, other than the creditor who himself makes an application, whose names and addresses are given in the application. , and Sub-clause (b) deals with a general notice, which notice is to be given to the debtor and all creditors to submit a statement in the prescribed form within one month of the date of the service of the notice or publication of the general notice, whichever is later. Mr. Walawalkar's contention is that the general notice is to be given only to those creditors whose names and addresses are given in the application. It is not possible to put that interpretation upon the expression "all creditors" used in Sub-clause (b), because if the intention of the Legislature was that general notice should be given only to those creditors referred to in Sub-clause (a), then the language used by the Legislature would not have been "all creditors", but either "such creditors" or "the creditors". But the very fact that the Legislature has used the general expression "all creditors", and has not specified or limited the class of creditors to the class referred to in Sub-clause (a), makes it clear that the intention was to give a general notice for giving intimation to all creditors of the debtor. Mr. Walawalkar says that even if a general notice is given to all creditors, unless a creditor responds to that notice and files a statement and appears on the application for adjustment of debts, the ultimate award that is passed is an award between the parties to the application and a creditor who is not a party to that application or who has not answered the notice cannot be bound by that award. Mr. Walawalkar says that an award under the Bombay Agricultural Debtors Relief Act is not a judgment 'in rem' within the meaning of Section 41, Evidence Act and therefore it does not bind the whole world, but only binds the parties to that award. Mr. Walawalkar says that unless this view is taken of the law, it will cause great hardship to creditors who may not be aware of the general notice given under Sub-clause (b) and who may not file a statement as required by that sub-section. Mr. Walawalkar further says that he should be given an opportunity to litigate the question as to whether the debtor is a debtor within the meaning of the Bombay Agricultural Debtors Relief Act, otherwise the result would be that his debt would be extinguished without his being given an opportunity to contest that issue. I admit that there is considerable force in Mr. Walawalkar's argument, but in order to decide this question I have got to look at the scheme of the Bombay Agricultural Debtors Relief Act as a whole.

(3.) IT is perfectly clear that the whole object of putting this Act on the statute book was to give relief to agricultural debtors and relief was to be given in the manner provided in the Act. All the debts of the debtor were to be adjusted. Not only some debts, not only debts of those creditors who had applied or whose names had been given by the debtor, but in order to work the machinery set up under the Bombay Agricultural Debtors Relief Act it was absolutely necessary that all the creditors should be before the special Court and all the debts of the debtor should be adjusted. This is clear from the fact that before the Court proceeded to adjust the debts it had to try certain preliminary issues under Section 17, and one of the preliminary issues was whether the total amount of debts due from such person on the date of the application exceeded Rs. 15,000, It would not be possible for the Court to decide this issue unless it knew who all the creditors of the debtor were and what was the amount of the debts. Further, Section 13 provided for consolidation of all applications made against the same debtor. Again, the object was that all the debts of the debtor should be adjusted. Then when we look further into the machinery provided by the Act, it provides for scaling down of debts, it provides for determining the paying capacity of the debtor, and it ultimately provides that unless the debts of the debtor are capable of being paid in 12 annual instalments he must be adjudicated insolvent, and it further provides that no application or proceeding in regard to insolvency of a debtor shall lie in, or shall be dealt with by, any other Court. Therefore, the whole purpose, the whole object of the Act was to relieve an agricultural debtor of all his debts, to make provision for the manner in which he should discharge those debts, and if he was not in a position to discharge those debts, to adjudicate him insolvent and give him relief by giving him the protection of insolvency.