Decided on January 07,1969


Cited Judgements :-



- (1.)This appeal is by the plaintiff in G. S. No.24/63 on the file of the Subordinate Judge Court, Adoni, against the judgment and decree in the said suiti The plaintiff had filed the suit for the recovery of Rs.8765/- together with subsequent interest on the foot of a promissory note executed by defendants 1 and 2 on behalf of themselves and on behalf of the partnership firm of T.G.Pampayya Setty & Sons., Adoni of which they along with defendants 3 to 5 are partners. It was further contended in the plant, that the defen lants are not agriculturists and are not entitled to the provisions of Act IV of 1938. In the written statement the fact that defendants 1 to 5 are partners of a registered partnership firm of T.G.Panpayya Setty & Sons., and defendants 1 and 2 are managing partners was admitted. Further, the execution of the promissory note and passing of consideration are also admitted. It is contended that the defendants are agriculturists en itled to the provisions of Act IV of 193S that they are not assessed to income-lax for the fast ten years an I the debt is therefore liable to be scaled down.
(2.)The Court while passing a decree for monies due under the promissory note, also directed the scaling down of the debt, granting 5% p. a. interest as it found that the defendants are agriculturists, that the firm was not assessed to income-tax for the accounting year commencing from 15-11-52 to 23-11-57 and therefore the debt is liable to be scaled down. Hence this appeal.
(3.)In this appeal the only point to be considered is whether the defendants are entitled to the benefits of Act IV of 1938 and have the debt scaled down, The defendants are admittedly partners of the registered partnership firm known as A. G. Pampanna Setty & Sons., Adoni. Ex. B. 2 is a certificate issued by the Registrar of Firms That had been issued in the name of the firm consisting of the partners, whose names are given. Only a debtor who is an agriculturist can have the debts scaled down as per the provisions of the Madras Agriculturists Relief Act IV of 1938 (hereinafter referred to as the Act). Section 3(2) defines 'agriculturist' as a person who has a saleable interest in any agricultural or horticultural land not being situated in any municipality or contonment etc., provided he shall not be deemed to an 'agriculturist' if he has been assessed to income tax for two years prior to the incurring of the debt or to profension tax or pays property or house-fax within municipal limits, or is a landholder of an estate under the Madras Estates Land Act. Sction 3 (1) states that the term 'person' means in individual and includes an undivided Hindu family, a Marumakkattyam or ailyasantana tarwad or tavashi, but does not include a bodv corporate, a charitable or religious institution or an unincorporated company or association. This would mean that the firm is not a 'person' and wi11 not be considered to be an agriculturist. When a firm is not considered to be an 'agriculturist' it follows that it is not entitled to the benefit of the provisions of the Act. This contention was raised in PITCHAYYA V. SUBRAYYA where one of the partners of a firm applied for scaling down of a debt and the lower court rejected the contention on the ground that a firm is not a 'person' as defined under Section 3 (1) of the Act and therefore a debt incurred by a firm is not one which can be scaled down and if that is due from an 'agriculturist' he cannot get the benifits of the Act because the debt wa,s not incurred by him qua-agriculturist. In appeal their Lordships Words worth and Patanjali Sastry, JJ held : "We are unable to accept this reasoning. A debt incurred by a partnership is really a debt incurred by the partners for which each of them is liable. This is recognised by the decree which makes the appellant and his partners personally liable. The apptllant is therefore a judgment debtor with a liability and if, as appears to be the case, he is an agriculturist, he is entitled to apply under Sections 19 and 20".

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