SINGHAL, J. - (1.) BRIEF facts giving rise to the present special appeal are that the petitioner-appellant claimed himself to be an agriculturist and filed a writ petition challenging the constitutional validity of the provisions of Section 4 (e) of the Rajasthan Relief of Agricultural Indebtedness Act, 1957 as violative of Article 14 of the Constitution of India.
(2.) THE petitioner-appellant has taken a loan from Bank of Baroda for purchase of tractor trolly and other implements and also for digging of well. THE D. P. Note, letter of hypothecation and letter of personal guarantee of Shri Sohan Lal were furnished. THE loan was sanctioned by the Bank at the rate of 12. 05%, which is 2% above the minimum bank interest rate of 10. 5% as per directives of the Reserve Bank of India. THEre was default in making payment of loan and a suit was filed by the Bank against the petitioner-appellant and the land of Khasra No. 3016/56 having area of 15 bighas situated at village Nainwa, which was mortgaged by Bhanwarlal in favour of the Bank was prayed to be auctioned. THE appellant-petitioner made an application under Section 6 of the Rajasthan Relief of Agricultural Indebtedness Act, 1957 (hereinafter to be referred to as "the Act)" in the Debt Relief Court (Civil Judge) Bundi praying that applicant Bhanwarlal is an agriculturist within the meaning of Section 2 of the Act and the Bank should be asked to render the entire statement of account and thereafter the Debt Relief Court should determine the actual amount payable. A further prayer was made that the amount may be allowed to be paid in the instalments of Rs. 500/- per month. THE Debt Relief Court vide its order dated 7. 4. 1984 held that the provisions of Clause (e) of Section 4 of the Act are not applicable to the Scheduled Bank. In the writ petition, the learned single Judge observed that the provisions of Clause (e) of Section 4 of the Act is a valid piece of legislation and it stands the test of permissible classification and fulfils the two essential conditions, namely, (i) the classification must be founded on an intelligible differentia, which distinguishes persons or things that are to be put together from others left out of the group and (ii) the differential must have a rational relationship to the object sought to be achieved by the statute in question. The provisions were held as not hit by Article 14 of the Constitution of India and the writ petition was dismissed. In order to appreciate the contention of the learned counsel for the appellant, the provisions of Section 4 are reproduced below : - 4. Inapplicability of the Act in certain cases : The provisions of this Act shall not effect claims due in respect of : - (a) rent as defined in clause (22) of Section 5 of the Rajasthan Tenancy Act, 1955 (Rajasthan Act 3 of 1955); (b) any liability in respect of any sum due to any society registered or deemed to be registered under the Rajasthan Co- operative Societies Act, 1953 (Rajasthan Act IV of 1953); (c) any liability arising out of a breach of trust; (d) any liability in respect of maintenance whether under a decree of a court or otherwise; (e) any liability due to a bank; (f) arrears of wages or salary; (g) any liability in respect of village profits or of land revenue arising between co-sharers and the lambardars or between a proprietor and a thekedar or a farmer of proprietory right or between co-sharers in ijara and Jagir villages; (h) a mortgage claim against property in the hands of subsequent transferee who has taken the transfer in order to satisfy the mortgage; (i) any liability arising between mortgagor and mortgagee in respect of land revenue of the mortgaged property which has been, paid by the mortgagee on behalf of the mortgagor; (j) any revenue or tax payable to Government or any other sum of money due to Government by way of or towards repayment of Loan or otherwise; (k) any tax payable to a local authority and any other sum of money due to it by way of or towards' repayment of a loan or otherwise. " Learned counsel for the appellant has submitted that the provisions of Section 4 (j) of the Act were examined by this court in the case of Nathudan vs. State of Rajasthan (1) wherein the learned Advocate General appearing on behalf of the State conceded that the provisions of the said section are hit by the provisions of Article 14 of the Constitution. The provisions of Section 4 (j) are applicable to "any other sum of money due to Government by way of or towards payment of a loan. " This concession was made by the then Advocate General on the basis of the Judgement of this court in Mukan Chand vs. Inder Singh : (2) wherein the provisions of Section 2 (e) of the Rajasthan Jagirdars' Debt Reduction Act was held to be hit by the provisions of Article 14 of the Constitution and the said judgement was upheld by the Supreme Court in the case of State of Rajasthan vs. Mukan Chand On that analogy the provisions of Sec. 4 (j) of the Act were held by the learned Single Judge as unconstitutional and hit by Article 14 of the Constitution of India. It was further submitted that the provisions of Sec. 4 (k) of the Act were also examined by this court in the Case of Fateh Singh vs. Gram Panchayat Ransi Gaon and others (4) wherein the claims due in respect of any tax payable to a local authority and any other sum of money due to it by way of or towards repayment of loan or otherwise was held to be not a valid piece of legislation and was hit by Article 14 of the Constitution.
(3.) THE judgment of this court in Ram Rakh vs. Creditors (5) was also referred to with regard to the provisions of Sec. 4 (b), wherein the Division Bench considered the scheme of the Act and the provisions with regard to the Rajasthan Jagirdar Debt Reduction Act and the objects and reasons of that Act vis-a-vis the Rajasthan Relief of Agricultural Indebtedness Act, 1957 and observed that the reasons for enactment of both the Acts are different. THE object of Rajasthan Jagirdar Debt Reduction Act was to reduce the debt secured on Jagir lands which have been resumed under the provisions of the Rajasthan Land Reforms and Resumption of Jagirs Act and that on that account the Jagirdar's capacity to pay debts has been reduced and the object of that Act was to ameliorate their condition. The main consideration in enacting that Act was that there was reduction in the assets of the Jagirdars by force of law and his debts must be reduced and it would make no distinction whether the debt is of the State or of any other person. The object of the enactment of the Act was with regard to the problem of agricultural indebtedness in the State has assumed considerable magnitude. Because of sheer necessity agriculturists are compelled to pay exorbitant rates of interests. Not only this but the interest which accrues on loans is from time to time added to the principal amount and the burden on the debtor goes on increasing, resulting in his inability to pay his debts in full. Our attention has also been drawn towards the provisions of the Banking Regulations Act, 1946, wherein in respect of the rate of interest charged by the banking companies the courts were debarred from examining the expressiveness in the rate of interest charged by this amendment. The Reserve Bank of India has fixed the interest to be charged by the scheduled banks for the different categories of debtors including advances and loans to the agriculturists and they have been treated in a preferential manner by charging the interest at the rates which were lower than other categories. ;