# Lakshmi Achi v. T. V. V. Kai/au Thevar

- **Citation:** [1964] 2 S.C.R. 259
- **Court:** Supreme Court of India
- **Decided:** 1964
- **Bench:** S. K. Das, A. K. Sarkar, 1\1. HrnAYATULLAH, N. Rajagopala Ayyangar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/lakshmi-achi-v-t-v-v-kai-au-thevar-2924
- **Pages:** 15

## Headnote

D<bt Relief-Agriculturist-Scaling down of decree debtEnabling statute coming into force pending appeal-Application
made 1Jfter appellate decree, if barred by res-judicata-Madras
Agric1.tturists Relief Act, 1938 (Mad. 4 of 1938), as amended by
Madras Act 23 of 1948, BB. 16 (iii), 19 (2).
The appellants had filed a suit on a mortgage against
respondent No. I and others as defendants and had obtained
a preliminary decree in it on May, 15, 1937 and a tinal decree
on January 20, 1938. Appeals were filed against the preliminary
Decree in the High Court of Madras.
While the app.·als were
pending there, the Madras Agriculturi•ts Relief Act, 1938 came
into force. The defendants in this suit other than respondent
No. 1 thereupon applied for relief under this Act. The applications succeeded and the High Court passed a new preliminary decree on
March
~!5, 1942 after sca1ing down the
amount recoverable in accordance with the Act.
The respondent No. I had neither contested the suit nor
appeared in the appeal! nor made any application under the
Act for relief. 'T'he preliminary decree passed by the High
Court, therefore, confirmed a• against him the decree passed
by the trial Court.
Respondent No. I thrreafter applied to
the trial Court for relief under the Act but the application was
dismissed on the ground that in view of the judgment of the
High Court the application was not maintainable in the trial
Court.
Respondent No. I thereafter applied to the Hig;.
1969
A. S. Krishnappo
Chaltiar
...
NorhiaPP• Chmiar
Mudholkor /,
1963
Morch 7
I
1963
Lakshmi Achi
v.
T. V. V. Kai/au
Thevar
260
SUPREME COURT REPORTS (1964]VOL.
Court for setting aside the exparte decree in so far as it deprived
him of the right to relief under the Act but that application
was also dismissed.
OnJanuary 25, 1949, Madras Act XXIII of 1948 was
passe<l amending the
A~t of 1938 by adding a sub-s. (2)
to
s. 19.
After
this
amendment
s.
19
read, "(l)
where
before
the commencement of this Act, a court
has passed a decree for the repayment of a debt, it shall, on
the application of any judgment-debtor who is an agriculturist
.... apply the provisions of this Act to such decree and shall
notwithstanding anything contained in the Code of Civil
Procedure, 1908, amend the decree accordingly or enter satisfaction, as the case may be.
(2) The provisions of sub-section (I) shall also apply to cases where, after the commencement of this Act, a Court has passed a decree for the repayment
of a debt payable at such commencement." Section 16 of the
amending Act provided, "The amendments made by this Act
shall apply to the following suits and proceedings, namely :-
...... (iii) all suits and proceedings in which th• decree or
order passed has not been executed or satisfied in full before the
commencement of this Act ....... ". Respondent No. 1 again
applied to the trial Court for relief under the Act in view of the
amendment but this application was rejected.
Respondent
No. 1 then appealed to the High Court which granted re!iei
under the Act.
The appellants thereupon appealed to the
Supreme Court.
Held, that the decree passed by the trial Court was
superseded by the preliminary decree passed by the High Court
on March 25, 1942.
The final decree on the basis of this
preliminary decree was passed by the District Judge on September 25, 19+3, and this was the only operative decree in the case.
Hence s. 19 (2) of the Act of 1938 read withs. 16 (iii) of the
amending Act created a new right in favour of defendant No. 1.
Jowad Hussain v. Gendan Singh, A. I. R. (1926) P. C. 93,
Gajadhar Singh v. Kishan Jiwan Lal, ( 1917) I. L. R. 39 All.
641, The Collector of Customs Calcutta v.
Th~ Ea•t Indian
Commercial Go. Ltd. [1963] 2 S. C.R. 563, referred to.
In the Act the word "debt" includes a decretal debt.
Narayanan
Ohettiar v.
Amm.amalai
Ohettiar, [1959]
Supp. I S. C. R. 237, followed.
Clause (iii) of s. 16 of the amending Act applies to this
~ase because the final decree had not been s~tisJ!ed in fu)l bef

## Text

2 S.C.R.
SUPREME COURT '.'IBPORTS
259
we uphold the decision of the High Court and dismiss
each of
these appeals with costs. There will,
however, be only one hearing fee.
Appeal& dismissed.
--
LAKSHMI ACRI AND OTHERS
v.
T.v.v. KAILASA TREVAR AND OTHERS
(S. K. DAS, A. K. SARKAR, 1\1. HrnAYATULLAH and
N. RAJAGOPALA AYYANGAR JJ.)
D<bt Relief-Agriculturist-Scaling down of decree debtEnabling statute coming into force pending appeal-Application
made 1Jfter appellate decree, if barred by res-judicata-Madras
Agric1.tturists Relief Act, 1938 (Mad. 4 of 1938), as amended by
Madras Act 23 of 1948, BB. 16 (iii), 19 (2).
The appellants had filed a suit on a mortgage against
respondent No. I and others as defendants and had obtained
a preliminary decree in it on May, 15, 1937 and a tinal decree
on January 20, 1938. Appeals were filed against the preliminary
Decree in the High Court of Madras.
While the app.·als were
pending there, the Madras Agriculturi•ts Relief Act, 1938 came
into force. The defendants in this suit other than respondent
No. 1 thereupon applied for relief under this Act. The applications succeeded and the High Court passed a new preliminary decree on
March
~!5, 1942 after sca1ing down the
amount recoverable in accordance with the Act.
The respondent No. I had neither contested the suit nor
appeared in the appeal! nor made any application under the
Act for relief. 'T'he preliminary decree passed by the High
Court, therefore, confirmed a• against him the decree passed
by the trial Court.
Respondent No. I thrreafter applied to
the trial Court for relief under the Act but the application was
dismissed on the ground that in view of the judgment of the
High Court the application was not maintainable in the trial
Court.
Respondent No. I thereafter applied to the Hig;.
1969
A. S. Krishnappo
Chaltiar
...
NorhiaPP• Chmiar
Mudholkor /,
1963
Morch 7
I
1963
Lakshmi Achi
v.
T. V. V. Kai/au
Thevar
260
SUPREME COURT REPORTS (1964]VOL.
Court for setting aside the exparte decree in so far as it deprived
him of the right to relief under the Act but that application
was also dismissed.
OnJanuary 25, 1949, Madras Act XXIII of 1948 was
passe<l amending the
A~t of 1938 by adding a sub-s. (2)
to
s. 19.
After
this
amendment
s.
19
read, "(l)
where
before
the commencement of this Act, a court
has passed a decree for the repayment of a debt, it shall, on
the application of any judgment-debtor who is an agriculturist
.... apply the provisions of this Act to such decree and shall
notwithstanding anything contained in the Code of Civil
Procedure, 1908, amend the decree accordingly or enter satisfaction, as the case may be.
(2) The provisions of sub-section (I) shall also apply to cases where, after the commencement of this Act, a Court has passed a decree for the repayment
of a debt payable at such commencement." Section 16 of the
amending Act provided, "The amendments made by this Act
shall apply to the following suits and proceedings, namely :-
...... (iii) all suits and proceedings in which th• decree or
order passed has not been executed or satisfied in full before the
commencement of this Act ....... ". Respondent No. 1 again
applied to the trial Court for relief under the Act in view of the
amendment but this application was rejected.
Respondent
No. 1 then appealed to the High Court which granted re!iei
under the Act.
The appellants thereupon appealed to the
Supreme Court.
Held, that the decree passed by the trial Court was
superseded by the preliminary decree passed by the High Court
on March 25, 1942.
The final decree on the basis of this
preliminary decree was passed by the District Judge on September 25, 19+3, and this was the only operative decree in the case.
Hence s. 19 (2) of the Act of 1938 read withs. 16 (iii) of the
amending Act created a new right in favour of defendant No. 1.
Jowad Hussain v. Gendan Singh, A. I. R. (1926) P. C. 93,
Gajadhar Singh v. Kishan Jiwan Lal, ( 1917) I. L. R. 39 All.
641, The Collector of Customs Calcutta v.
Th~ Ea•t Indian
Commercial Go. Ltd. [1963] 2 S. C.R. 563, referred to.
In the Act the word "debt" includes a decretal debt.
Narayanan
Ohettiar v.
Amm.amalai
Ohettiar, [1959]
Supp. I S. C. R. 237, followed.
Clause (iii) of s. 16 of the amending Act applies to this
~ase because the final decree had not been s~tisJ!ed in fu)l before
2 S.C.R.
SUPREM;E COURT REPORTS
261
the commencement of the amending Act and that created a
fresh right in defendant No. I to the b~nefit of su b-s. ( l)
of s. 19.
Defendant No. I cannot be deprived of the new 1 ig[1t
given by the amending Act by reason of the dismi;sal of his
earlier application. for reliefs under the Act which were made
before the creation of the right.
CIVIL
APPEALLATE
jURISDIC'l'ION :
Civil
Appeal No. 617 of 1960.
Appeal by special leave from the judgment
and order dated December 2, 1!155 of the Madrzts
High Court in C. M. A. No. 355 of l 951.
A. V. Viswanatha Sastri, R. Ganapathi Iyer
and G. Gopalakrishnrin for the a opellants.
21:!. K. Raroomurthi, D. P. Singh, R. K. Gar!J
and S. 0. Agarwala, for respondent No. l.
1963. March 7. The Judgment of the Courr
was delivered by
1963
La,\shmi 'chi
v.
T.V.V. Klli/a.1a
Th 1 1ar
S. K. DAS
J.-This
is
an
appeal
by
D,, .1.
special leave from the judgment all.cl order of the
Madras High Court dated December 2, HJ55 by
which the said Court set aside the order of the learned District Judg~ of East Tanjore dated August
30, 1950 passed on an application made by the 1st
respondent herein, under s. 19 of the l\fadras Agriculturists Relief Act (Act IV of 1938), hereinafter
called the principal Act, as amended by the Madras
Agriculturists Relief (Amendment) Act of 1948 (Act
XXIII of 1948).
By the said order the learned
District Judge dismissed the application as unsustainable in law. The High Court set aside that order
on the ground that the respondent's application for
the scaling down of the decree passed against him
should not have been dismissed in lirnine and the
learned District Judge should have gone into the
question whether the respondent was an agriculturist
1963
lAlu/im; A <hi
v.
T.V.V. KoilaJa
Thn:"'
Das J.
•
262
SUPREME C~uRT REPORTS [1964] voi.
entitled to the benefit of the principal Act as amen·
<led in 1!)48.
The material facts arc not very much in controversy, but this is one of those cases in which a long
history must be stated for the appreciation of a very
short point involved in the case.
The short point
involved is, whether the application made by the I st
respondent herein to the District Judge of East Tanjore in O. S. No. 30 of 19:J4 on December 6, 1950
was unsustainable in law.
We may now statt the long history. The appellants before us are the representatives of the original
plaintiffs who as mortgagees instituted a suit (being
0. S. JS'o. 30 of 1934) in the court of the District
Judge, East Tan)ore for the enforcement of a mort·
gage against respondent No. I, who was defendant
No. l in the suit, and six other persons. The mortgage bond upon which the suit was brought was
executed by defendant No. I for himself and his
minor undivided brother, de!Cndant No. 2, and also
as authorised agent on behalf of defendants 3 to 7'
who were interested in a joint family business.
The
suit
was contested by all the defendants, except
defendant No. 1 against whom it proceeded ex parte.
A preliminary decree was passed on May 15, 1!)37 by
which a sum of Rs. 1,08,098/-
was directed to be
paid by defendant No. I and defendants 3 to 7, in
default of which the plaintiffs were declared entitled
to apply for a final decree for sale of the mortgaged
property and the suit was dismissed as against defendant No. 2.
Against this decree, two appeals were
taken to the Madras High Court, one by defendants
3 to 7 (being Appeal No. 48 of 1938) who contended
that the mortgage was not binding on them or on
their shares in the joint family property ; and the
other by the plaintiffs (being Appeal No. 248 of
1938), who challenged the propriety of the judgment
of the trial Judge in so far as it dismissed their claim
-
'
~ s.c.R..
suPRErvtE couR.r Rir0RTs
26a
against defendant No. 2. During the pendency of
these appeals the principal Act came into force and
applications were made by defendants 2 to 7 to the
High Court praying that in the event of a decree
being passed against them, the decretal debt might be
scaled down in accordance with the provisions of the
principal Act. Defendant No. 1 who did not appeal
at any stage of the proceedings did not make any such
application. The High Court forwarded these applications to the lower court for enquiry and asked for
a finding on the question whether the applicants
were agriculturists and if so, to what extent the
decretal dues should be scaled down.
The District
Judge made the necessary enqu ry and submitted a
finding that the applicants were agrir.:ulturists and that
the.debt, if scaled down would amount to Rs. 49, 255jwith interest th:ireon at six percent per annum
from October 1, 1937 exclusive of costs.
On receipt
of this finding the appeals were set down for final
hearing and by their judgment dated March 25,
1942 the learned Judges of the Madras High Court
accepted the finding of the court below and held that
defendants 2 to 7 were entitled to have the debt
scaled down, but as no application had been made
on behalf of defendarit No. 1 he was held entitled to
no relief under the principal Act.
A decree was
drawn up in accordance with this judgment.
The
amount due by defendants 2 IQ 7 was stated to be
Rs. 49,255/- with interest thereon at six per cent per
annum, while so for as defendant No. l wa.~ concerned the decree of the trial .Judge was affirmed subject
to a slight modification regarding the rate of interest.
Defendant No. 1 thereupon filed an application in
the court of the District Judge, East Tan Jore, claiming relief under the principal Act alleging that he too
was an agriculturist and hence entitled to the benefits
of the Act. This application was
dismissed
on
February 25, 1943 on the ground that as a decree
had already been passed by the High Court definitely negativing his claim to any relief under the
Lakshmi A.chi
v.
T.V.V. Kailasa
Tht-var
D~s J.
1963
Lalulrmi Achi
v.
J .V.V. Kaila10
Tlrtcar
Das J.
•
264
SUPREME COURT REPORTS [1964) voL
principal Act, such a11plication was not entertainablc
by the lower court. The next step ·taken by drfrn.
dant No. l was to file an application in the High
Court itself praying for setting aside the ex parte decree
which excluded him from the benefits of the principal
Act. This
application was rejected by the High
Court on December 13, 1943.
As no payment was
made in accordance with the preliminary decree pas· ,
sed by the High Court, a final decree in terms of the
same was passed by the District Judge on September
25, 1943.
Proceedings for
execution
of this
final decree were started on August 16, Hl44 when
an execution petition was filed in the court of the
District Judge, East Tanjore. Some of the mortgaged properties were sold and purchased by the decreeholders for a total sum of Rs. 12,00iii· and part satis·
faction of the decree was entered for that amount.
In the course of these proceedings certain terms of
• settlement were offered by the judgment-debtors.
The estate of the decree-holders was then in
the
hands of the receivers, and it appears that the receivers agreed, with the sanction of the court to receive
Rs. 24,000/- only from or on behalf of defendant
No. 2 and release him and his share of the mortgaged property from the dccretal charge.
Likewise
the receivers agreed to receive Rs. 48,000/· from
defendants :i to 7 and to release them and their pro·
perties from the dccrctal debt. With regard to
defendant :'lo. l also the receivers agreed to accept
Rs. 37,500/· and it was agreed that if one Yacob
Nadar paid the amount on behalf of defendant No. I
on consideration of the decree against defendant
No. I being assigned to him, the receivers would
accept the same.
No such payment was however
made on behalf of ddcndant No. l. liut a sum of
Rs. 24,llOO/- was paid on behalf of defendant No. 2
and his properties were exonerated from the decree.
Defendants 3 to 7 also paid a sum of Rs. 48,000/ ·
and odd in two instalments in discharge of their
decretal debt. The three amounts paid by defendants
2 S.C.R. SUPREME cot.JR. T REPOR ts
265
2 to 7 totalled Rs. 72,610-12-0. On March 6, 1947
defendant
No. 1 deposited in court a sum of
Rs. 3215/· and put in a petition under s.47 and Order
XXI r. 2 C. P. C. praying that the amount deposited by him together with the payments already made
by defendants 2 to 7 completely wiped ofJ the amount
due under the decree as scaled down by the High
Court in favour of defendants 2 to 7; defendant
No. 1 prayed that as the decree was one and indivi·
sible, full satisfaction of the decree should be record·
ed exonerating the
mortgaged property and also
defendant No. 1 himself from any further liability
in respect of the decretal debt.
The position taken
up by defendant No. 1 in substance was that the
mortgage debt was one and indivisible and even
though different amounts were mentioned as pay·
able by two groups of defendants in the decree, the
decree-holders were bound under the terms of the
decree to release the entire mortgaged property even
on payment of the amount directed to be paid by
defendants 2 to 7.
This contention of defendant
No. 1 was negatived by the District Judge, but was
accepted by the High Court on appeal which allowed
the application of defendant No. 1 and directed
that the court below should enter full satisfaction of
the mortgage decree. The decree-holders then came
up to this court in appeal (C. A. No. 32/1950) and
the judgment of this court is reported in V. Ramaswami Ayyangar and others v. T. N. V. Kailasa
Thavar (1 ). This court held that though the general
law undoubtedly is that a mortgaged decree is one
and indivisible, exceptions to the rule are admitted
in special circumstances where the integrity of the
mortgage has been disrupted at the instance of the
mortgagee himself. This court further held that
there was nothing wrong in law in scaling down a
mortgage decree in favour of one of the judgment·
debtors while as regards the others the decree was
kei;t intact; the principal Act was a special statute
which aimed at giving relief not to debtors in general
(I) (19.51] S. C. ll, 292;
19~3
Lakshmi Ad1i
v.
T.V.V, KailrJsJ
Thevar
Dus J,
1963
v.
T.V.V. Kada.sa
Thrrar
DaJ J.
266
SUPREME COURT REPORTS [1964] VOL
but only to a specified class of debto!"'I,
namely,
those who arc agriculturists as defined by the Act
and to this extent it trenched upon the gcucral law.
The result of the decision of this court was that the
decree stood unscaled as against the !st defendant.
When the appeal in the Supreme Court was pending,
the amending Act of 1948 was enacted and it came
into force on January 25, l!HfJ.
We shall presently
read the provisions of this amending Act. On the
strength of these provisions defendant No. I made an
application again to scale down the decrctal debt. This
was application No. 79 of H.150. It was this applica·
tion which the learned District Judge
held to be
unsust:tinable in law.
On appeal, the High Court
held that the application was sustainable and an
enquiry should be made whether defendant :>lo. I is
an agriculturist within the meaning of the principal
Act. The present appeal is directed against this
order of the High Court.
Now before we proceed to consider the questions which arise in this appeal it is necessary to set
out the relevant provisions of the principal Act and
the amending Act of 1948 of which defendant No. 1
(respondent No.I herein) claims the benefit. We must
first reads. 19 of the principal Act. That section is in
these terms :
"19. (1) Where before the commencement of
this
Act,
a
court
has passed a decree
for
the repayment of a
debt,
it shall,
on the application of any judgment-debtor
who is an agriculturist
or
in
respect of
a Hindu joint family debt, on the application
of any member of the family whether or not he
is the judgment-debtor or on the application
of the decree holder, apply the provisions of
this Act to such decree and shall, notwithstanding anything contained in the Code of Civil
Procedure, l!J08, amend the decree accordingly or enter satisfaction, as the case may be :
2 s.c.R..
SUPREME COURT REPORTS
261
Provided that all
payments made or
amounts recovered, whether before or after
the commencement of this Act, in respect of
any such decree shall first be applied in payment of all costs as originally decreed to the
creditor.
(2) The prov1s10ns of sub-section (1)
shall also apply to cases where, after the
commencement of this Act, a Court has passed
a decree for the repayment of a debt payable
at such commencement."
It is worthy of note that s. 19
as it originaliy
stood in the principal Act was re-numbered as subs. (1) ofs. 19 andsub-s. (2) was added bys. 10 of the
amending Act of 1948. We may also set out here
s. 16 amending Act of 1948.
That section is in
these terms :
•
"16.
The amendments made by this Act shall
apply to the following suits .and proceedings
namely:-
(i)
all suits and proceedings instituted after
the commencement of this Act ;
(ii) all suits and proceedings instituted before
the commencement of this Act, in which
no decree or order has been passed, or in
which the decree or order passed has not
become final,
before, such commencement;
(iii) all suits and proceedings in which the
decree or order passed has not been executed or satisfied in full
before
the
commencement of this Act :
Provided that no creditor shall be
required to refund any sum which has
LakJ/imi A.chi
v.
T.V.V. Koilasa
Th1uar
Das J.
1963
la~·1limi Ad1i
v.
T. V. V. Koilasa
I i,a;ar
Du J.
268 SUPREME COURT REPORTS [1964] Vat.
been paid to or realised by him, before
the commencement of this Act."
Rcspoucicul i\o. I claimed thal he was entitled to 1hc
benefit of sub-s. (2) of s. !!) read with cl. (iii) of s. 16
of the amending .Act of 1948.
The learned District
Judge nagatived this claim 011 the following three
grounds :
(i)
He held that in 0. S.
~o. 30/HJ:l4 the
preliminary decree was originally passed
on May lfi, 1937 and the final decree on
January 28, I !)38 and
both these dates
were anterior to the coming into force of
the principal Act.
The principal Act, it
may be stated here, came into force on
March 22, lll38.
Therefore sub-s. (2) of
s. I!) did not apply to the present case.
(ii) Secondly, he held that sub-s. (2) of s. 19 app·
lied to those cases only where there was a
debt payable on the date of the commencement of the principal Act; in the present
case, however, there was no debt. payable
on the date of the commencement of the
principal
Act, the debt having ripened
into a decree; therefore sub-s. (2) of s. 19
was not applicable.
(iii) Thirdly, he held that the claim of defendent No. 1 to have the decree against him
scaled down having bccu decided agaimt
him by the District Judge in I. A. ~o. 104
of 1942 on February 25, l!i43 and the same
claim having been negatived by the High
Court in subsequent proceedings, it was
not open to defendant No. 1 to make a
fresh claim under sub-s. (I) of s. UJ because
though sub-s. (I) of s. I !J usc4 the expression "notwithstanding anything contained
in the Code of Civil Procedure", that expression related to the provision of the
...:.
2 s.c.R. SUPREME COURT REPORTS
260
-
Code in the matter of amendment of
decrees and entering of satisfaction of
decree but did not include the principle of
res judicata, a principle which is more
general and comprehensive in rnaracter
than what is laid down in s. 11 of the
Code.
The High Court apparently procee1Jed on the
footing that the present case wr s one in which a
decree had been passed after the commencement of
the principal Act and therefore sub-s. (2) of s. 19,
added by the amending Act of 1948, applied.
The
High Court said that no serious attempt was made
before it on behalf of the decree-holders to support
the view of the learned District Judge that the debt
in the present case was not a debt within the meaning of the principal Act because it had ripened into
a decree prior to the commencement of the principal
Act. The High Court then referred to s. 16 of the
amending Act and held that defendant No. l .was
entitled to the benefit of sub-s. (2) of s. 19 read with
cl. (iii) of s. 16 of the amending Act, 1948 and the
circumstance that the claim of defendant No. 1 to
the benefits of the principal Act prior to its amendment in 1948 had been negatived by the District
Judge and the High Court did not deprive him of the
new right which the amending Act had given him
provided he was able to prove that he was an agriculturist within the meaning of the Principal Act.
Learned counsel on behalf ·of the appellants
has argued before us that the view expressed by the
High Court is not correct. He has contended that the
present case does not come under sub-s. (2) of s. 19
because this was a case in which a decree was passed for
the repayment of a debt before the commencement
of the principal Act, namely, before March 22, 1938.
He has pointed out that so far as defendant No. 1 is
concerned, a preliminary decree was passed against
him on May 15, 1937 and a final decree on January
J9;3
Lakshmi A.chi
v.
T.Y,V. K11.ilasa
Theuar
Der J.
1163
f.a/;shmi A•hi
..
T.V.V. Kaila.so
Tbtt'dr
Das/.
270
SUPREME COURT REPORTS [1964] VOL.
28, I !l38.
He has also referred us to the decree
pa~sed in the High Court on March 25, 1942. In
cl. (6) of that decree it was stated that so for as defendant No. I was concerned the direction made by the
learned District Judge in the decree passed on May
15, l!l37
would stand confirmed.
Therefore, the
argument before us is that the only provision of
which defendant No. 1 was entitled to claim benefit
is s. 19 as it stood before its amendment in 1948
which applied to cases where a decree was passed
before the commencement of the principal Act and in
as much as the claim of defendant No 1 under that
provision had been negatived both by the District
judge and the High Court on previous applications
made by defendant No. I, it was not open to him to
make fresh claim under the same provision. Learned
counsel has also submitted that the provisions of the
amending Act, 1948 have no application in the present case and therefore no new right has been given
to defendant No. 1.
The crucial point for decision in connectiqn
with the arguments stated above is whether the decree
in the present case is a decree passed before the commencement of the principal Act or after its commencement. It is indeed true that the District Judge
passrd a pn·limin;iry decree on May 15, rn:n and a
final d~cree on .January 28, 1938.
These decrees,
however, were superseded by the preliminary decree
which the High Court passed on March 25, 1942.
As this court pointed out in Ramaswami Ayyangar's
case (supra), a preliminary decree wa~ drawn up in
accordance with the judgment of the High Court by
which the amount due from defendants 2 to 7 was
scaled down while so far as defendant No. l was
concerned, the decree of the trial Judge was affirmed
subject to a slight modification regarding the rate of
interest. The decree passed on March 25, 1942 was
a preliminary decree in as much as it directed that
in default of the payment of the amounts directed
-
2 S.C.R.
SUPREME COURT REPORTS
271
to be paid by the decree, the mortgaged properties
would be sold.
When no payments were made as
directed by the preliminary decree of \he High Court
a final decree in terms of the same was passed by the
District Judge himself on September 25, 1943.
This was the decree which was put in execution.
It
is well settled that where an appeal has been preferred
against a preliminary decree the time for
applying for final decree runs from the date of the
appellate decree; see Jowad Hussain
v. Gendan
Singh ('). In that decision the Privy Council quoted
with approval the following observations of Benerjee,
J. made in Gajadhar Singh v. Kishan Jiwan Lal (').
"It seems to me that this rule-the rule regulating application for final decree in mortgage
actions-contemplates the passing of only one
final decree in a suit for sale upon a mortgage.
The essential condition to the making of a final
decree is the existence of a preliminary decree
which has become conclusive between
the
parties; When an <J.ppeal has been preferred,
it is the decree of the appellate Court which is
the final decree in the cause."
The principle that the appellate order is the operative
order after the appeal is disposed of, which is the
basis of the rule that the decree of the lower court
merges in the decree of the appellate court, has been
approved by this court in The Collector of G?tstoms,
Calcutta v. The East India Commercial Go., Ltd., (8).
We are thtrefore of the view that the operative
decree in the present case was the preliminary decree
made by the High Court on March 25, 1942 which
was made final on September 25, 1943. That being
the position, the present is a case to which sub·s. (2)
of s. 19 is attracted as also the provisions of s. 16 of
the amending Act of 1948. Sub-s. (2) of s. 19 read
with cl. (iii) of s. 16 entitles defendant No. 1 (respondent No. 1 herein) to claim the benefit of the principal Act, even though his earlier applications prior to
(1) A.I.ll .. 1926 P.C. 93.
(2) (11117) l.L,R; 39 All. 641.
(~) [196312 S, C, R, 563.
1963
Lakshmi Ar.hi
v.
T.V.V. Kailasa
The1ar
D.Js J.
1963
LaJ.:1hmi Achi
v.
1.V.V. K•ilosa
Tltti;or --
n,u J.
272 SUPREME COURT REPORTS [1964) VOL.
the amending Act of I!l48 were rejected.
Sub·s.
(2) of s. 19 read with s. 16 creates a new right in
favour of respondent No. l and that right cannot be
defeated on the principle of res judicata.
The true
scope and effect of s. 16 was considered by this court
iu Naraya.nan Chettiar v. Annamalai Chettiar (').
Referring to cl. (iii) of s. 16 this court said :
"Clause (iii}, it seems clear to us, applies to
suits and proceedings in which the decree or
order passed had become final, but had not
been
executed or satisfied in
full before
January 2:), 1 !)49 : this means that though a
final decree or order for repayment of the debt
had been passed before January 25, 1949, yet
an agriculturist debtor can claim relief under
the Act provided the decree has not been executed or satisfied in full before the aforesaid
date.
It should be remembered in this connection that the word 'debt' in the Act has a
very
comprehensive connotation. It means
any liability in cash or kind, whether secured
or unsecured, due from an agriculturist, whether
payable under a decree or order of a civil or
revenue court or otherwise etc. It is, therefore,
clear that the word 'debt' includes a decretal
debt."
In the case before us cl. (iii) of s. 16 clearly aoplics
because
the final decree which was passed on
September 2f>,
l!Jt:~ had not been satisfied in full
before the commencement
of the amending Act,
1948, that is, before January 25, l!J4U.
Therefore,
by reason of cl. (iii) s. 16. of the amending Act of
UJ48 respondent No. I was entitled to the benefit of
sub-s. (2) of s. I 0, and he cannot be deprived of that
benefit because prior to the new right given to him
by the amending Act of l!H8 ,his applications for
getting relief under the principle Act had been
rejected ..
l\) [1959] Supp. I S.C.R. 237.
•
;
2 S.C.R.
SUPREME COURT REPORTS
273
We have, therefore, come to the conclusion that
the view expressed by the High Court is the correct
view and respondent No. 1 is entitled to the benefit
of sub-s. (2) of s. 19 read with cl. (iii) of s. 16 of the
amending Act of 1948, provided he establishes that he
is an agriculturist within the meaning of the principal Act.
The appeal therefore fails and is dismissed
with costs.
A ppe-J l dismissed.
FIRM SETH R ADHA KI.SHAN (DECEASED)
REPRESENTED BY HARI KISHAN
AND OTHERS
v.
THE, ADMINISTRATOR, MUNICIPAL
COMMITTEE, LUDHIANA
(K. SUBBA Ri1.o, RAGHUBAR DAYAL and
J. R. MuDHOLKAR, JJ.)
Terminal Tax-Municipality-Collection of-Remedies by
way of appeal provided in the Act-Expre.s or implied exclusion
of Civil courts-Punjab Municipal Act, 1911 (Pnnj. I TI of 1911),
s.•. 61, 78, 84, 86-Punjab Government Notification No. 26443
dated July, 21, 1932-Items 68, 69 of the Scheditle-Code of
Civil Procedure, 1908 (Act 5 of 1908), s. 90.
The appellant is a firm carrying on business within the
octroi limits of Ludhiana Municipality. On the Sambhar salt
imported by it into the limits of the Municip:ility terminal tax
was imposed and the appellant made payment of the said tax.
Under item 68 of the Schedule to the relevant Govtrnment
Notificatinn the Municipality is entitled to impose a certain rate
of tax on common salt and under item 69 it is entitled to impose
a higher rate of tax in respect of salt of all kinds other than
common salt.
In the present case the higher rate was imposed.
The appellant filed a suit against the respondent in the civil
co11rt, Ludhina, for the refund of the amount paid by him,
1963
Lakshmi Achi
v.
T.V.V. Kailasa
Thevar
Das J.
1963
March 7