BABURAO K PAI Vs. DALSUKH M PANCHOLI
LAWS(BOM)-1954-1-7
HIGH COURT OF BOMBAY
Decided on January 25,1954

BABURAO K. PAI Appellant
VERSUS
DALSUKH M. PANCHOLI Respondents


Cited Judgements :-

PANDIT CHANDER SAIN VS. RANI VIDYAWANTI [LAWS(DLH)-1970-10-9] [REFERRED]
BISHWA NATH GUPTA VS. BASDEOMAL JOGDHIAN [LAWS(ALL)-1959-3-16] [REFERRED TO]
GANGAVVA VS. UDACHAPPA [LAWS(KAR)-1961-10-2] [REFERRED TO]
SHYAMLAL RAMKRISHNA AGARWAL VS. TAKHATMAL BODHRAJ [LAWS(MPH)-1957-3-17] [REFERRED TO]
PANDAB BISSOYI VS. MAGITI SASAMAL [LAWS(ORI)-1956-8-1] [REFERRED TO]
KARAMCHAND PESSUMAL VS. MADHAVDAS SAVALDAS [LAWS(BOM)-1956-3-2] [REFERRED TO]
BENUDHAR DALAI VS. STATE OF ORISSA [LAWS(ORI)-1958-4-13] [REFERRED TO]
PARKASH TEXTILE MILLS LTD VS. MANI LAL [LAWS(P&H)-1954-10-9] [REFERRED TO]
YOGRAJ VS. STATE [LAWS(P&H)-1962-10-16] [REFERRED TO]
RAM PARTAP MALL VS. HARDAS SINGH GURDIAL SINGH [LAWS(P&H)-1955-7-3] [REFERRED TO]


JUDGEMENT

Chagla, C.J. - (1.)The plaintiff filed a summary suit in this Court against the defendant on 8-41952. On 6-5-1952, the defendant made an application under Section 5 of the Displaced Persons (Debts Adjustment) Act to the Tribunal in Delhi who is the Senior Sub-Judge there. On 30-9-1953, the plaintiff took out a summons for judgment and in his affidavit in reply the defendant contended that inasmuch as he had made an application under Section 5, the suit pending before the Court was liable to be stayed under Section 15(a). Mr. Justice Tendolkar gave unconditional leave to the defendant to defend for the purpose of having the following issue determined: "Whether this Court has jurisdiction to determine whether the defendant is 'a displaced person' and whether the claim in suit is 'a debt' within the meaning of those words in the Displaced Persons (Debts Adjustment) Act?" The learned Judge also expressed an opinion that inasmuch as there were conflicting decisions of single Judges on this question, the matter should be referred to a Division Bench. Thereupon this matter has been referred to this Bench.
(2.)The Displaced Persons (Debts Adjustment) Act (70 of 1951) is an Act passed by Parliament setting up a special Tribunal to deal with debts due to and by displaced persons, and the question that we have to consider is, what is the Jurisdiction of this Tribunal and to what extent the jurisdiction of the civil Court has been ousted? The Act gives a definition of the expression "debt" and also of "displaced person" and Chapter II deals with debt adjustment proceedings and it deals with three types of applications. One is an application by a displaced debtor for the adjustment of his debts, the second is an application by a displaced creditor having a claim against a displaced debtor, and the third is a claim by a displaced creditor in respect of a debt due from a person who is not a displaced person. Section 5 provides for an application by a displaced debtor for the adjustment of his debts; and Sub-section (1) provides that a displaced debtor may make an application for the adjustment of his debts to the Tribunal within the local limits of whose jurisdiction he actually and voluntarily resides, or carries on business or personally works for gain. It is under this section that the defendant has made an application to the Delhi Tribunal alleging that he resides or carries on business within the local limits of that Tribunal, that he is a displaced person, and that debts are due by him which should be adjusted. Sub-section (2) sets out the particulars which should be contained in such an application, and under Clause (e)(i) a schedule must be attached to the application containing full particulars of all his debts, whether owed jointly or individually, with the names and addresses of his creditors and joint-debtors, if any, so far as they are known to, or can by the exercise of reasonable care and diligence be ascertained by him. Section 6 gives the power to the Tribunal to reject the application when that application does not comply with the requirements of Section 5. Section 7 provides for the issue of notices on the respondents who are the creditors mentioned in the schedule. The creditors are constituted respondents by Section 5(3). Section 8 deals with the objections by the respondents and the respondent may show cause against the application by filing a written statement. Then comes the important section, Section 9, which deals with proceedings after service of notice on the respondents, and Sub-section (1) is to the following effect: "If there is a dispute as to whether the applicant is a displaced person or not or as to the existence or the amount of the debt due to any creditor or the assets of any displaced debtor, the Tribunal shall decide the matter after taking such evidence as may be adduced by all the parties concerned and shall pass such decree in relation thereto as it thinks fit." Therefore, by Section 9 jurisdiction is conferred upon the Tribunal to decide (1) whether the applicant is a displaced person or not, (2) whether the debt mentioned in the debtor's application exists, and (3) if the debt exists, what is the amount of the debt. It is clear that the debt referred to in Section 9(1) is the debt denned by the Act, and it is only in respect of such a debt that the Tribunal has jurisdiction to pass a decree. Section 10 deals with claims by creditors against displaced debtors, and it is rather significant to note that as between displaced creditors and displaced debtors what has to be investigated is a claim made by the creditor and not a debt due by the displaced debtor as defined by the Act. Then Section 11 deals with procedure on the creditor's petition. Section 13 deals with claims by displaced creditors against persons who are not displaced debtors, and in this case the creditor has not only to make a claim, but he must claim a debt due from a person who is not a displaced person. Therefore, it seems that under Section 13 an application can only be maintained by a displaced creditor against a non-displaced person provided his claim is in respect of a debt as denned by the Act. Section 14 deals with the procedure on displaced creditor's petition. Then we come to Section 15 which deals with the jurisdiction of the civil Court, and that section provides:
"Where a displaced debtor has made an application to the Tribunal under Section 5 or under Sub-section (2) of section 11, the following consequences shall ensue, namely: (a) all proceedings pending at the date of the said application in any civil court in respect of any debt to which the displaced debtor is subject. .......shall be stayed,...... (c) no fresh suit or other proceeding........ shall be instituted against a displaced debtor in respect of any debt mentioned by him in the relevant schedule to his application:"

(3.)Now, in this particular case, as already stated, the defendant has made an application under Section 5 and in the schedule to his application he has shown the plaintiff as a creditor. Notice has been served upon the plaintiff under Section 7 and the plaintiff has filed his objection under Section 8 and the Tribunal has raised the following three issues: (1) is the liability a debt within the meaning of the Act LXX of 1951? (2) is the petitioner a displaced person? (3) What is the paying capacity of the petitioner? The third issue arises by reason of Section 32 which provides for scaling down of the debts due by a displaced person in relation to his paying capacity. It seems to us clear, looking to the language of Section 15, that as soon as an application has been made by the displaced person under Section 5 the consequence mentioned in Clause (a) must follow and the consequence is the staying of proceedings in respect of any debt which, is mentioned in the schedule annexed to the debtor's application under Section 5. It also seems to us clear that under Section 9 the only authority that can determine whether a person is a displaced person or not and whether a debt is due by him which debt fails within the definition of the Act, is the Tribunal set up under Section 4 of the Act. In setting up a Tribunal a Legislature may follow one of two methods. It may provide that a Tribunal shall have jurisdiction provided certain conditions exist and those conditions would be jurisdictional conditions going to the very jurisdiction of the Tribunal. It would not then be for the Tribunal to decide whether those conditions exist or not, because the very existence of the Tribunal, its very authority, depends upon; those conditions existing. Or the Legislature may set up a Tribunal and confer upon that Tribunal jurisdiction to decide all questions which arise in respect of a particular subject matter for which the Tribunal has been set up. In our opinion it is not possible to contend that it is left to the civil Court to decide whether a person is a displaced person or not and whether a debt exists as defined by the Act before the Tirbunal can exercise its jurisdiction. With respect to Mr. Justice Desai, that is exactly the view that he has taken in -' Bombay Radio Co. Ltd. v. N. N. Murajani', O.C.J. Suit No. 511of 1953 (Bom) (A). His view is that before a suit can be stayed under Section 15, it is for the Court to decide whether the person who applies for a stay is a displaced person or not and whether the debt which the plaintiff claims against him is a debt covered by the definition under the Act. Again, with respect to Mr. Justice Desai, what he has overlooked is that the Legislature has set up the Tribunal under the Act to try these very questions which Mr. Justice Desai says the civil Court has the right to try before it grants a stay of the suit. Section 9 is unqualified in its operation and ambit. It provides that if there is a dispute as to whether the applicant is a displaced person or not and as to the existence of the amount of the debt, the Tribunal shall decide the matter. Therefore, the Legislature has set up the Tribunal to determine the questions mentioned in Section 9, and by reason of Section 15 it is provided that the only authority that can try those questions is the Tribunal and not the civil Court. What is urged is that under Section 15(a) all proceedings pending at the date of the said application in any civil Court in respect of any debt to which the displaced debtor is subject shall be stayed, clearly indicates that the application must be in respect of a debt to which the Act applies and it must be by a displaced debtor as defined by the Act. It is only when those two conditions are satisfied that the pending proceedings are to be stayed, and it is contended that it is for the civil Court to decide that these two conditions are satisfied before the proceedings should be sayed.


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