(1.) The State Bank of Travancore obtained a decree in O. S. No. 56 of 1961, Sub Court, Kottayam against the appellant before us. The decree was in 1962. The appellant judgment debtor filed E A No 209 of 1971 claiming the benefits under S.4, 5, 7 and 8 of the Kerala Agriculturists' Debt Relief Act (Act 11 of 1970). This was dismissed by the Execution Court on the ground that the debt concerned was not liable to be scaled down under the provisions of the Act. That decision was confirmed in appeal. The judgment debtor has preferred this Second Appeal. 2. The question whether the debt is liable to be scaled down or not, depends upon the exact scope, and the respective spheres of operation, of sub clauses (ii) and (iii) of S.2 Clause (4) of the Act. For the sake of convenience, we shall extract the relevant clause:
"2(4) 'Debt' means any liability in cash or kind, whether secured or unsecured, due from or incurred by an agriculturist on or before the commencement of this Act. whether payable under a contract or under a decree or order of any court, or otherwise but does not include-
(a) any sum payable to --
(i) x x x x x
(ii) The Reserve Bank of India or the State Bank of India or any subsidiary hank within the meaning of clause (k) of S.2 of the State Bank of India (Subsidiary Banks) Act, 1959, or the Travancore Credit Bank (in liquidation) constituted under the Travancore Credit Bank Act, IV of 1113:
Provided that the right of the bank to recover the sum did not arise by reason of any assignment made subsequent to the 1st day of July, 1957". or
(iii) a corporation owned or controlled by the Government of Kerala; or the Government of any other State or the Government of India or a Government company as defined in the companies Act, 1956".
While the proviso to sub clause (ii) stood as we have extracted above, it was ruled by a Division Bench of this Court in State Bank of Travancore v. Vasudevan Pillai ( 1971 KLT 978 ), that the assignment contemplated by the proviso was only one by act of parties and not by operation of law: Apparently to get over the effect of the decision, Act 13 of 1973 effected an amendment which was as follows:
"2 Amendment of S.2.-- In clause (4) of S.2 of the Kerala Agriculturists' Debt Relief Act 1970 (11 of 1970) (hereinafter referred to as the principal Act) for the proviso to paragraph (ii) of sub clause (2), the following proviso shall be substituted, namely:
Provided that the right of the Bank to recover the sum did not arise by reason of
(A) any assignment made; or
(B) any transfer effected by operation of law, subsequent to the 1st day of July, 1967".
The above amendment is retrospective from the date of passing of the Act 11 of 1970.
(2.) The question that now falls for determination is whether a debt which is covered by the proviso to S.2(4)(ii) of the Act, and therefore liable to be scaled down under the main provisions of the Act, would lose that character and be exempt from the scaling down provisions, if it falls within the purview of sub-s.(iii) of the above clause. What has been contended for the decree holder bank is that the exemptions may well overlap, in the sense, that even if a particular debt is caught by S.2(4)(ii), it may still be attracted by the proviso to S.2(4)(iii). On the other hand, for the judgment debtor, it is contended that this mode or method of construing the different clauses would be opposed to the spirit and purpose of the enactment, as it would take away with one hand what has been given by the other. As the question involved regarding the construction of the provisions of the Act was important and had far reaching consequences, we issued notice to the learned Advocate General, and we are obliged for the assistance that he offered us by his argument at the hearing.
(3.) The learned Advocate General contended that the proper way of explaining the two sub clauses is to hold that they operate in distinct spheres and did not overlap. Therefore, it was argued by him that if a debt is caught by the terms of the proviso to S.2(4)(ii) of the Act, and is therefore liable to be scaled down under the beneficial provisions of the statute, that effect cannot be denied by holding that it is liable to be hit by S.2(4)(iii) of the Act. This mode of construction, was commended to us both on the principle of generalia Specialibus non derogant, and also against the background of the legislative history regarding the proviso to S.2(4)(ii) of the Act. Giving the matter our careful consideration, we think the stand taken by the learned Advocate General is correct, and must be accepted. We do not think that it was within the scheme and contemplation of the Act that debts due to the State Bank or Reserve Bank or to the subsidiary banks which are liable to be scaled down by reason of the proviso to S.2(4)(ii) were meant to be denied that benefit by reason of the comprehensive and generic provision contained in S.2(4)(iii) of the Act. On the other hand, reading the two clauses together, and harmonising them, we think the reasonable interpretation, in the circumstances, is to hold that the Reserve Bank, the State Bank of India and any subsidiary bank contemplated by, and mentioned in, sub-s.(ii) of S.2(4), would all stand excluded from the ambit of the corporations mentioned in sub-s.(iii) thereof.;