# SUPREME COURT REPORTS [1964] VOL. PULAVARTHI VENKATA SUBBA RAO AND ORS v. VALLURI JAGA.NNADHA RAO & ORS

- **Citation:** [1964] 2 S.C.R. 310
- **Court:** Supreme Court of India
- **Decided:** 1964
- **Bench:** P. B. Gaje;<;Dragadkar, M. HIDAYATIJl.I, j. C. SHAH
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/supreme-court-reports-1964-vol-pulavarthi-venkata-subba-rao-and-ors-v-valluri-2928
- **Pages:** 14

## Headnote

Relief to agriwlturiat.-Scali711J down of d'bl•-Compromi.e d•.cree-Nature-Whelher can be scale</ down-Whether
re< judicata-Jfadras Agriculluri't. Relief (Amendment) Act,
1948 (Mad. 23 of 1!148), •· 16 (ii)-Madras Agriculturists
Relief Act, 1938 (Mad. 4 of 1938), s. 19.
A suit was filed in 1941 for the recovery of Rs. 50,000.
The respondents prayed for the scaling down of the amount
due from them under tho Madras Agriculturists Relief Act,
1938, on the ground that they were aiiriculturists. The suit
was compromised for Rs. 37 ,000/-. Some payments were also
made.
fn 1949, another application was made by the respondents
for the scaling down of the debt on the ground that they were
agriculturists and hence were entitled to the br.ncfits of the
Act of 1938 as amended in 19{8.
The contention of the
decree-holder was that the Amendiug Act'"" not applicable
in view of the provisions of s. 16 (ii) of the Amending Act as
the compromise decree had
becorr1c
final.
i\-loreo\'cr,
the
earlier compromise decree op...:ratcd as re.~ j 1tdir:'ll'L
Another
contention
\Vas
that
the judgment-dcbt0rs \Vere not agriculturi5ts as they \Vere a joint Hindu family o\vning an estate
for which a 1'"/tka•h of more than Rs. 500/- was payable.
The
trial court held that the decree was liable to be scaled down
in view of the provisions of the Amending . .\ct.
·rhc matter
\\'as taken to the
High Court in revision.
·rhc High Court
directed the trial court to take evidence and submit its finding
on the point ,,·hether the appellants \Vere agriculturists or not.
'fhe finding of the trial court \Va., that the judgrnent-<lebtors con.
stituted a joint Hindu family which vwned an estate flir which
peshkash of more than Rs. j00j- w8' payable and hence were
not agricultrists.
The lligh Court ca1ne to the conclt1sion that the eH\t
was not held jointly but i" definite shares. The pes/1ka•l1 iri
•
2 S.C.R.
SUPREME COURT REPORTS
311
respect of the two villages constituting an estate could not be
aggregated. Under the circumstances, the peshkash paid by
the individual judgment-debtors did not exceed Rs. 500/- and
hence the judgment debtors were agriculturists. The High
Court also held that the compromise decree could not be regarded as final for purposes of s. 16 (ii) of the Amending Act,
and the principle of res judicata did not apply. lt was also
held that the judgment-debtors were entitled to have the decree
scaled down.
The appellants came to this Court by special
leave.
He/,d that the appeal had no merit and must fail. The
judgment-debtors were agriculturits and the peshkash paid by
them individually did not exceed Rs. 500/-.
Hence they were
entitled to get their debts scaled down.
He/,d also, that all decrees which had been executed and
satisfied before the commencement of the Amending Act in
January, 1949, were unaffected by the Amending Act, but all
decrees which were not final and which remained to be executed, either wholly or in part, were subject thereto. However,
the decree-holder was not to be required to refund any sum
which might have been paid or realized hy him. No distinction
was made between decrees passed after contest and decrees
paesed
on
compromise.:.
Both kinds of
decrees were
amenable to the provisions of
s. 19 (2)
of the Act of
1938 ands. 16 (ii) of the Amending Act of 1948. The case
was thus governed by s. 16 (iii) and not bys. 16 (ii).
Held also, that although the conduct of the respondents
in omitting to press the claim for reduction of the amount of
the claim on the first occasion was si~nificant> yet that did not
constitute res judicata, either statutory or constructive.
The
compromise decree was not a decision by the Court.
It was
the acceptance by the Court of something to which the parties
had agreed. The compromise decree merely set the seal of the
court on the agreement between the parties and the court did
not decide anything.
A decision of the court \Vas not implicit
in the co1npromise.
On~y a decision by the
court c·Juld be
res judica

## Text

1963
310
SUPREME COURT REPORTS [1964] VOL.
PULAVARTHI VENKATA SUBBA RAO
AND ORS.
v.
VALLURI JAGA.NNADHA RAO & ORS.
(P. B. GAJE;<;DRAGADKAR, M. HIDAYATIJl.I,AH and
j. C. SHAH jj.)
Relief to agriwlturiat.-Scali711J down of d'bl•-Compromi.e d•.cree-Nature-Whelher can be scale</ down-Whether
re< judicata-Jfadras Agriculluri't. Relief (Amendment) Act,
1948 (Mad. 23 of 1!148), •· 16 (ii)-Madras Agriculturists
Relief Act, 1938 (Mad. 4 of 1938), s. 19.
A suit was filed in 1941 for the recovery of Rs. 50,000.
The respondents prayed for the scaling down of the amount
due from them under tho Madras Agriculturists Relief Act,
1938, on the ground that they were aiiriculturists. The suit
was compromised for Rs. 37 ,000/-. Some payments were also
made.
fn 1949, another application was made by the respondents
for the scaling down of the debt on the ground that they were
agriculturists and hence were entitled to the br.ncfits of the
Act of 1938 as amended in 19{8.
The contention of the
decree-holder was that the Amendiug Act'"" not applicable
in view of the provisions of s. 16 (ii) of the Amending Act as
the compromise decree had
becorr1c
final.
i\-loreo\'cr,
the
earlier compromise decree op...:ratcd as re.~ j 1tdir:'ll'L
Another
contention
\Vas
that
the judgment-dcbt0rs \Vere not agriculturi5ts as they \Vere a joint Hindu family o\vning an estate
for which a 1'"/tka•h of more than Rs. 500/- was payable.
The
trial court held that the decree was liable to be scaled down
in view of the provisions of the Amending . .\ct.
·rhc matter
\\'as taken to the
High Court in revision.
·rhc High Court
directed the trial court to take evidence and submit its finding
on the point ,,·hether the appellants \Vere agriculturists or not.
'fhe finding of the trial court \Va., that the judgrnent-<lebtors con.
stituted a joint Hindu family which vwned an estate flir which
peshkash of more than Rs. j00j- w8' payable and hence were
not agricultrists.
The lligh Court ca1ne to the conclt1sion that the eH\t
was not held jointly but i" definite shares. The pes/1ka•l1 iri
•
2 S.C.R.
SUPREME COURT REPORTS
311
respect of the two villages constituting an estate could not be
aggregated. Under the circumstances, the peshkash paid by
the individual judgment-debtors did not exceed Rs. 500/- and
hence the judgment debtors were agriculturists. The High
Court also held that the compromise decree could not be regarded as final for purposes of s. 16 (ii) of the Amending Act,
and the principle of res judicata did not apply. lt was also
held that the judgment-debtors were entitled to have the decree
scaled down.
The appellants came to this Court by special
leave.
He/,d that the appeal had no merit and must fail. The
judgment-debtors were agriculturits and the peshkash paid by
them individually did not exceed Rs. 500/-.
Hence they were
entitled to get their debts scaled down.
He/,d also, that all decrees which had been executed and
satisfied before the commencement of the Amending Act in
January, 1949, were unaffected by the Amending Act, but all
decrees which were not final and which remained to be executed, either wholly or in part, were subject thereto. However,
the decree-holder was not to be required to refund any sum
which might have been paid or realized hy him. No distinction
was made between decrees passed after contest and decrees
paesed
on
compromise.:.
Both kinds of
decrees were
amenable to the provisions of
s. 19 (2)
of the Act of
1938 ands. 16 (ii) of the Amending Act of 1948. The case
was thus governed by s. 16 (iii) and not bys. 16 (ii).
Held also, that although the conduct of the respondents
in omitting to press the claim for reduction of the amount of
the claim on the first occasion was si~nificant> yet that did not
constitute res judicata, either statutory or constructive.
The
compromise decree was not a decision by the Court.
It was
the acceptance by the Court of something to which the parties
had agreed. The compromise decree merely set the seal of the
court on the agreement between the parties and the court did
not decide anything.
A decision of the court \Vas not implicit
in the co1npromise.
On~y a decision by the
court c·Juld be
res judicata, whether it be statutory under s. 11
of the Code
of Civil Procedure or constructive as a matter of public policy
on whir.h the entire doctrine re .ts.
1,,1e earlier derision could
not strictly be rc~arded as a matter which was "heard and
finally decided". The decree might have created ~n estoppel
by conduct between the parties but that had not been pleaded
and tried at any time.
Held also, that the Act of 1938 as amended in 1948
conferred up<m the petty agriculturists the right to get their
. 1963
I'ulavarthi Venkat.i
.'.>ubba Rao
v.
Valluri Jatannadha
Rao
1963
Pu/ova,thi Vnrkata
Subba Rao
v.
VtJ//uri Jagannadha
Hao
llidll,)atullah J.
312 SUPREME COURT REPORTS [1964] VOL.
debts scaled down in order to save them from the oppressive
loans taken at usurious rates of interest,
Arunachala Mudaliar v. C. A. Muruganatha ltfurlaliar,
11954] S. C.R. 243 and Venakataratnam v. Seshamma, I. L. R.
(1952) Mad. 492, referred to.
CIVIL ArPEJ,LATE JURISDICTION
Civil Appeal
No. 17 of 1959.
Appeal from the judgment and order dated
April 6, 1955, of the High Court of Andhra Pradesh
at Guntur in C.R. P. No. 6f>6 of 1950.
N.
Narsaraju,
Advocate-General,
Andhra
Pradesh and T. V. R. 1'atachari, for the appellants.
'l'. Satyanarayan, for the respondents.
1963. 11arch 13. The Judgment of the Court
was delivered by
1-!IDAYATULLAH .J.-This appeal on certificate
granted by the High Court of Andhra Pradesh. is
directed against
iL~ judgment dated April 6, HJ:i5,
dismissing Civil Revision Petition Ko. 656 of 1950.
The High Court held that the respondents were
agriculturists within the Madras :\grieulturists Relief
Act, l!l38 (called for brevity "the Act") anrl were
entitled to a
scaling
down
of the decree in
O. S. No. G2of1941, dated August 27, l!l45.
The
decree-holders are the appellants before us.
\Ve will
now give the facts relevant to the present appeal.
The respondents were members of an undividecj
-
2 S.C.R.
SUPREM:E COURT REPORTS
313
Hindu family and the following geneology is useful
in foll owing the facts :-
Valluri J agannadha Rao I
I
Srivatsank~a Rao
Narasimha Rao
,----t .
Jagannadha Rao II
Satyanarayanamurth1
(Ist respondent)
(2nd respondent)
I
SrivatsaJkara Rao
I
N arasimha Rao
(3rd respondent)
(5th respondent)
Subba Rao
(4th respondent)
N arasimha Rao had taken loans on promissory notes
from the ancestors of the present appellants, and a
suit was filed for Rs. 50,000 odd in 1941 against the
family. That suit was 0. S. No. 52 of 1941. In
that suit, an application was made by the respondents, claiming to be agriculturists, for the scaling
down of the amount. The plaintiffs in the case
denied that the defendants were agriculturists.
The
suit, however, ended in a compromise decree for
Rs. 37,000/-
on August 23, 1945, as against the
claim for Rs. 50,964-1-9. It appears that some payments were also made towards this decretal amount.
On February 21, 1949, the judgment-debtors made
another application in the suit (Interim Application
No. 279 of 1919) for scaling down the decretal
amount on the ground that they were agriculturists
entitled to the benefits of the Act, as amended
in 1948.
The
decree-holders have raised three
defences, (i) that the Amending Act was not applicable in view of the provisions of s. 16 (ii) of the
;\mending Act
as
the compromise decree hact
1963
Pulavarthi V1nkala
Suhba Rao
••
Valluri Jagannadh'J
Rso
Hidayatulloh J.
1963
Pu/avarlhi · V mkata
Suhbd Raa
••
l'allu1i JagoMIU/ha
RO<I
Hidoyotullalt J.
314 SUPREME COURT REPORTS [1964] VOL.
"become final" (ii) that the earlier compromise
decree operated as res judicata, and (iii) that the
judgment-debtors were not agriculturists as they were
a joint Hindu family owning an estate for which a
peshka8h of more than Rs. ~00/ · was payable.
The Subordinate Judge,
Narsapur,
before
whom the application was made, framed two issues
as follows :-
(I) Whether the petitioners arc agriculturists
entitled to' the benefits of the Act, and
(::')
Whether the present petition is barred
under s. 16 (ii) of the Amendin~ ActMadras Agriculturists Relief (Amendment)
Act (No. XXIII), l!l48.
The learned Subordinate .Judge first considered the
second issue which was one of law and by his order
dated March 15, 1950 held that the decree was
I iable to be scaled down in view of the provisions of
the Amending Act. He then set down the first issue for
trial and posted the case for evidence on the question
whether the judgment·debtors were agriculturists.
The decree.holders meanwhile filed an application
for revision (C. R. P. No. 656 of
I 950)
on
April 28, l!l50.
The High Court heard this application on August 20, W52, and decided to call for a
a finding from the Subordinate Judge whether the
judgment-debtors were agriculturists.
A preliminary
order was made by the High Court dirrcting the
Subordinate Judges to take evidence and to submit
his finding on this point and the parties were to be
given an opportunity to object to the finding after it
was received. The Subordinate .Judge, after recording
the
evidence,
submitted
his
finding
on
December 17, I 952.
He held that the judgmentdebtors constituted a joint Hindu family which
owned an estate for which a peshkash of more than
-
2 S.C.R. SUPREME COURT REPORTS
315
Rs. 500/- was
agriculturists.
payable
and
were
thus
not
1963
When this finding was received in the High
Court,
the revision applicatio~ was taken up for
consideration. The High Court agreed with the
Subordinate Judge that the provisions of the amending Act were applicable, that the compromise decree
could not be regarded as final for purposes of cl. (ii)
of s. 16 of the Amending Act, and that the principle
of res judicata did not apply.
The High Court
endorsed the opinion of the Subordinate Judge that
the judgment-debtors were entitled in law to have
the decree scaled down, provided they were agriculturists. The High Court then considered the
second question, and differing from the Subordinate
Jurlge, came to the conclusion that the judgmentdebtors were agriculturists and entitled to have the
decree
scaled down. The
decree-holders
have
appealed.
Before dealing with the questions that arise in
this case, a few more facts relevant to the question
whether the judgment-debtors can be considered to
be agriculturists or noc, may be stated. The family,
it is admitted, owned two villages, namely, Kalagampudi and Pedamamidipalli, which were an estate as
defined
in the Madras Estates Land Act.
The
villages belonged to Valluri Jagannadha Rao I, the
original holder, and were his self-acquired properties.
Jagannadha Rao I executed a will in respect of these
and other properties on March 20, 1902 (exh. A 17).
By that Will, he gave a life-estate in the two villages
to his two sons-Valluri
Srivatsankara Rao and
Valluri Narasimha Rao-and an absolute estate to
such of the sons of these two as might be living at
the termination of each of the life estates, respectively. The will provided further that if any of his
sons left no son, the sons of his other son would be
absolutety entitled to the properties at the end of
Pulavarthi Venkata
Subba Roo
v.
Valluri Jogannadha
Rao
Hidayatullah J,
1963
Pufacorlhi J'enkata
Sub611 R1J
••
l'a/luri Jagannadho
Rao
Hiiq)'atullah J.
3IG SUPREME COURT REPORTS [1964] VOL.
the life estate.
It was also provided that if his
two sons wished to divide the property, the cider
son Srivatsankara Rao was to take Kalagampudi
and the younger son, the other village.
The two
sons divided the properties in which they were given
life estates, vide, exhibit BI dated June 14, 191 l.
Srivatsankara Rao took Kalagampudi and l\arasimha
Rao took
Pedamamidipalli. Srivatsankara Rao
died on December 15, 1936, without leaving a son,
and Jagannadha Rao II and Satyanarayanamurthi,
the two sons of Narasimha Rao, became a1.JSolutely
entitled
to Kalagampudi
in
equal
shares.
On
February 18, 1!!41,
Narasimha Rao executed a
sale-deed (cxh. A 5i) in respect of two·fifth share in
Pedamamidipalli village in favour of Subhadradevi,
his daughter.
Narasimha Rao died on May 17,
1943, and .Jagannadha Rao II and
Satyanarayanamurthi became entitled to a half share each in the
three-fifth share in
Pedamamidipalli
village in
addition to the half share in Kalagampudi.
The
judgment-debtors claimed that there was a partition
between the two sons of Narasimha Rao in l!l4tl.
The 7ieshkash, which was
payable for the
two villages when
they
were in the name of
Jagannadha Rao I, was Rs. 979-3-0 (iidc cxh. I A
dated tl I0.18i9J.
After the death of Shrivatsankara
Rao in l !136,
the two
villages were
separately
Registered.
PedamamidipaMi was registered in the
name of Nara imha Rao and Kalagampudi in the
name of his sons.
The peshkash was then apportioned
between the two villages and Rs. 483-12-IO
was fixed as pesh/,;ash for Pedamamidipalli village
and Rs. -tfl.5-6-2, for Kalagampudi village.
This
is stated in the proceedings of the Collector, West
Godavari, (exh. A 4), dated April 24, l!HO.
To decide whether the conclusion of the Subordinate Judge or of the High Court is right, it is
necessary at this stage to read a few provisions of
-
-
2 s.c.R. SUPREME COURT REPORTS 317
the Act.
'Agriculturist' is defined by s. 3 (ii} of
the Act and
the relevant parts of the definition
are as follows : -
"(ii) 'agriculturist' means a person who-
(a) has a saleable interest in any agri·
cultural
or horticultural land in the State
of Madras, not being land situated within a
municipality or cantonment, which is assessed
by the State
Government to land revenue
(which shall be deemed to include peshkash
and quit-rent}, or which
is held free of tax
under a grant made, confirmed or recognized by Government ; or
(b) holds an interest in such land
under a landholder under the Madras Estates
Land Act, 1908, as tenant, ryot or undertenure holder ; or
x
x
x
x
x
x
x
Provided that a
person shall not be
deemed to be an 'agriculturist' if he-
(D) is a landholder of an estate under the
Madras Estates Land Act, 1908, or of a share or
portion thereof, whether
separately registered
or not, in respect of which estate, share or
portion any sum exceeding five hundred rupees
is payable as peshkash, or any sum exceeding
one hundred rupees
is
payable under one
or more of the following heads, namely, quitrent, jodi, kattubadi, poruppu or other due of
a like nature, or is a janmi under the Malabar
Tenancy Act, 1929, who is liable as such janmi
to pay to . the State Government any some
exceeding five
hundred
rupees
as
land
revenue.''
The word 'person' is defined by cl. (i) of s. 3 as
including an undivided Hindu family.
1968
Pulauarlhi Ve11k11ta
Subba Rao
v.
Valluri Jazannadha
Rao
Hidayalultah J.
1963
Pu/a;·nrthi J',,iJ,.,,-7
~u
1•b1J Uu.1
'
VaUun _/ a_~annnd~a
l<ao
fiidayatullah J
31s sui>Ri:ME couRT REPoR.Ts [l964J voL.
The contention of the judgment-debtors was
that there were two persons who were legatees under
the will.
They took the villages not a; ancestral
properties but as self-acquired properties, and the
peshkash payable on these two villages must be
divided between them before s. 3 (ii), proviso (D)
of the Act was
made applicable. The contention
on the side of the decree-holders was that these
properties were held by an undivided Hindu family
and the sons of Narasimha Rao took the properties
under the Will as ancestral
properties, and the
peshl~sh in respect of the two villages must be added
together for the purpose of the application of the
said proviso. The High Court held that the properties taken by the two sons of Narasimha Rao under
the will
were their separate properties and not
ancestral properties, as there were no words to show
a contrary intention. The High Court also referred
to the conduct of the respondents in partitioning the
villages and held that the property was held not
jointly but in definite shares.
The High Court,
therefore, held that the peshl;ash in respect of the
two villages could not be agreggated.
The High
Court, accordingly, broke up the peshkash in respect
of Kalagampudi
and
the
three-fifth share of
Pedamamidipalli into two halves and held that as
each son of Narasimha Rao was required to pay only
his share the peshkash paid by them individually
did not exceed Rs. 500/- mentioned in proviso {D),
and that the judgment-debtors were, therefore,
agriculturists. This part of the case was not challenged before us by the learned Advocate General of
Andhra Pradesh.
Indeed, the decision of the High
Court is supported by C. N. Arunacha/IJ Jfudaliar
v. C. A . .lforuganatha Mwialiar {'),in respect of the
character of the property inherited by the two sons
of Narasimha Rao. and this fundamental fact could
not be questioned.
We must then start with the
conclusion that the judgment-debtors are agriculturists.
Before we consider the other objections to
(I) [19M] S.0.ll. 263.
2 s.c.k.
SUPREME COURT REPORTS
3i9
the claim of the respondents to have the decree
scaled down, we will deal with another argument
on this part of the case. It is contended that the
High Court was in error in interfering with the
finding that the respondents are not agriculturists in
an application for revision under s. 115, Civil Pro·
cedure Code.
This, in our opinion, is not a correct
summing up of what the High Court did. The High
Court had called for a finding and it was to be
subject to objections by the parties.
The High
Court could have called for the evidence and itself
given a finding. In re-examining the evidence with
a view to reachiug a correct finding on the question
whether the judgment-debtors were agriculturists or
not, the High Court was not interfering in revision
with a finding of fact, but was drawing the correct
inference from evidence it had itself ordered to be
recorded before considering the law applicable to
the case.
In our opinion, this objection has no
validity.
It was next argued that the respondents cannot
claim the benefit of the Act, because the compn•mise
decree must be considered to have become a final
decree and the second clause of s. 16 of the Amending Act and not the third applied, and in any event,
the respondents were concluded by the compromise
decree which operated as res judicata. To under·
stand this argument, it is necessary to read s. 19 of
the Act. and s. 16 of the Amending Act.
Section
19 of the Act was amended by the addition of sub·
s. (2) in 10i8. Section 19, as amended, reads :-
" 19 ( 1) Where before the commenc~ment
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
1963
Pulavarthi Vt'nkata
S•bba R.,,
v.
Val/uri Jagannadha
Rao
Hitlayat ilfaii J.
1963
Puft11rrf'hi
V11.~ /If
~1.ibbc Rao
v.
Vnliu1i Ja~aFfntldha
n.,
320 SUPREME COURT REPORTS [1964] \tot.
decree.holder, apply the provisions of this Act
to s1Jch rkcree an<l
sh~ll. notwirhstandin!! am··
tb.ug cou tained in tire Cod" ul Civil Pro~~<lur~,
!U08, amend the decree accordingly or enter
satisfaction, as the ca~e may be :
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 p~yment
of all costs as originally decreed to the creditor.
(2)
The provisions of sub·scction
( 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."
The Amending Act also provided bys. I():-
"16. The amendments made,by this Act
shall apply to the following suits and proceed·
ings, 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 excuted or satisfied in full before
the commencement of this Act :
Provided that no creditor shall be required
to refund any sum which has been paid to or
-
2 S.C.R.
SUPREME COURT REPORTS
321
realized by him, before the commencement of
1963
thl·s Act."
The conte:ition of the appellants is that a compromise decree is a decree which finally determines the
rights of the parties and the case is,
therefore,
governed by cl. (ii) of s. 16 and not by cl. (iii); as
claimed by the respondents. There seems to have
been at one time some difference of opinion in the
interpretation of this section in the High Court, but
the view which has prevailed is that the section
applies only to those decrees which can be said to
be final in contra-distinction to decrees which are
merely interlocutory or preliminary. It has also
been held now for a Jong time in the High Court
that cl. (iii) governs all cases of money decrees in
which the decree passed has not been executed or
satisfied in full before the commencement of the
Act. See Venkataratnam v. Seshamma (').
Iu
other words, all decrees which have been executed
and satisfied before the commencement of the
Amending Act on January 12, I9i9, are unaffected
by the Amending Act,
but all decrees which are
not final and which remain to be executed either
wholly or in part, are subject thereto, but the proviso
states that in scaling down such decrees, the decree·
holder would not be required to refuud any sum
which might have been paid or realised by him.
No distinction is made between decrees passed after
contest and decrees passed on com pramise.
Both
the kinds of decrees are amenable to the provisions
of s. 19 (2) and also of s. 16 (iii). There being no
distinction between decrees passed after contest and
decrees passed on compromise, the words "in which
the decree or order passed has not become final" in
cl. (ii) of s. 16, cannot be held to refer to a compro·
mise decree but to decrees which are final such as
final decrees for foreclosure, etc., in suits on mortgages. The prevailing interpretation of the section in
the High Court is preferable in view of the generality
(I) I.L,R. 1952 M~d. fg2,
Pulavartlfi Vtn,kata
Subba Rao
v.
Valluri JagMlniJ.dha
&o
Hidayatul/oh J.
1963
Pul•f:Jl!f'thi Ytrillkata
Suiba Rao
v.
l'allu1i Jatannadha
R ..
/fidll]atullah J,
322 SUPREME COURT REPORTS [1964] VOL.
of the words used in ss.
J!l (2) and
16 (iii).
In any event, it would be improper to unsettle a
view of law which has
now become inveterate.
This case was governed bys. 16 (iii), read with
s. I\:! (2) and the respondents were entitled to broach
the ~uestion of the scaling down of the decree once
again.
The appellants then seek to reach the same
result by invoking the principle of res judir,ata.
It
is contended that the earlier decision amounts to
res judicata and the respondents were not entitled
to raise the same issue which by implication must
be held to be decided against them by the compromise judgment and decree. In the alternative, it is
contended that the earlier compromise decree creates
an estoppcl against the respondents because the appellants at that time had shown some concession in the
amount which they were claiming and a decree for
a lessor amount was passed.
This estoppel was
said to be an estoppel by judgment.
In our opinion,
these contentions cannot be accepted. The Act as
amended confers this right upon petly agriculturists
to save them from the operation of loans taken at
usurious rates of interest.
No doubt the conduct of
respondents in omitting to press the claim for reduction of the amount of the claim on the first occasion
is significant, but this did not constitute res judicata,
either statutory or constructive. The compromise
decree was not a decision by the Court. It was the
acceptance by the Court of something to which the
parties had agreed. It has been said that a compro·
mise decree merely sets the seal of the court on the
agreement of the parties.
The court did not decide
anything. Nor can it be said that a decision of the
court was implicit in it.
Only a decision by the
court could be res judicaw, whether statutory under
s.11 of the Code of Civil Procedure, or constructive as
a matter of public policy on which the entire doctrine
rests.
The respondents claim to raise the issue
-
-
-
--
'
2 S.C.R.
SUPRE.NIE COURT REPORTS
323
over again because of the new rights conferred by the
Amending Act, which rights include, according to
them, the re-opening of all decrees which had not
become final or which had not been fully executed.
The respondents are entitled to take advantage of
the amendment of the law unless the law itself barred
them, or the earlier decision stood in their way.
The earlier decision cannot strictly be regarded as
a matter which was "heard and finally decided".
The decree might have created an estoppel by conduct between the parties; but here the appellants are
in an unfortunate position, because they did not
plead this estoppel at any time. They only claimed that the principle of res judicata governed the
case or that there was an estoppel by judgment.
By that expression, the principle of res judicat,a is
described in English law.
There is some evidence
to show that the respondents
had paid
two
sums under the consent decree, but that evidence
cannot be looked into in the absence of a plea of
estoppel by conduct which needed .to be raised and
tried. The appellants are, however, protected in
respect of these payments by the proviso to cl. (iii) of
s. 16 of the Amending Act.
In our opinion, this appeal has no merits and
· must fail. It is accordingly, dismissed, but in the circumstances of the case, we make no order about
costs in this Court.
Appeal dismi11sed.
,
1963
Pul1Jv4rthi Venkata
Suhh« Rflo
v.
Valluri Ja4anr1atiha
RQD
Hid•y•tu/lah J,