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TMI Blog1981 (8) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... and recover rents, profits and income of the property. (3) The real question for decision now is: What is the amount due to the Corporation on the foot of the mortgage ? The answer to this question will depend on another question. That question is whether the principle of damdupat as enacted in Section 30 of the Punjab Relief of Indebtedness Act, 1934 (the Act) as extended to Delhi applies to this suit. Counsel! for the Corporation says that Section 30 of the Acf has no application to the present suit. The Corporation claims interest @ 7-1/2% p.a. with half yearly rests as provided in the mortgage deed. The borrowers, on the other hand, contend that Section 30 of the Act forbids the court to pass a decree for a sum larger than twice the amount of the sum actually advanced less- any amount already received by the Corporation. Section 30(2) of the Act says : "In any suit in respect of a debt as defined inspection 7, advanced after the commencement of this Act. no Court shall pass or execute a decree or give effect to an award in respect of such debt for a larger sum than twice the amount of the sum found by I he Court to' have been actually advanced less any amount already ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive banks or to co-operative societies or to the State Bank of India or to any banking company registered under the Indian Companies Act, 1913, prior to the first day of April, 1937, or any bank included in the Second Schedule to the Reserve Bank of India Act 1934, other than debts transferred to such societies, banks or banking companies during the pendency of an application under section 9 in which such debts could be taken into consideration for the purposes of this Act, or debts transferred to such societies, banks or banking companies on or after the 2nd day of September, 1938, if in the opinion of the board such transfer was effected with a view to avoid the operation of this Act." Immediately after this' the term "debtor" is denned in Section 7(2) : "'debtor' means a person who owes a debt and (I)who both earns his livelihood mainly by agriculture, and is either a landowner, or tenant of agricultural land, or a servant of a landowner, or of a tenant of agricultural land, or (II)who earns his livelihood as a village menial paid in cash or kind for work connected with agriculture, or (III)whose total assets do not exceed five thousand rupees Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sioner. Such a person must fulfill one of the three qualifications enumerated in Section 7(2). He must have the "status" of a "debtor" defined in sub-section (2). If he has lost that status he cannot apply to the Debt Conciliation Board. For example, if his assets exceed ₹ 5000 he will not be entitled to apply to the Debt Conciliation Board for the scaling down of his debts. (10) For the purposes of Part V which is headed as "Damdupat" the debtor who has incurred a debt has only to satisfy the condition of Section 7(1). He has not to show further that he is also a "debtor" as defined in Section 7(2). All that is necessary for the application of the rule of damdupat is t'hat the person invoking it must be a debtor,, whatever his status. When the suit is in respect of a debt as defined in Section 7(1), irrespective of who the debtor is and what his status is, the rule of damdupat as enacted in Section 30 is immediately attracted. (11) Counsel for the Corporation contends that though it is true that the term: 'debt' is referred to specifically in Section 30(2) the term 'debtor' is used in Section 7(1) and must therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (2) of that section, but for that there is no justification as the word 'debtor' is specially defined in sub-section (2) with limited meaning for the purposes of Part Iv of this Act, while the meaning of the word 'debt' in sub-section (1) being inclusive is not narrowed by the definition. It is true that some defined liabilities' are excluded from that definition but that does not make the meaning of the word 'debt' in sub-section (1) as merely confined to a debt owed by a 'debtor' as defined in sub-section (2). A 'debtor' as defined in that sub-section of course is a person who owes a debt, but a 'debt' as defined in sub-section (1) may be owed by a 'debtor' as defined in sub-section (2) and may also be owed by a debtor falling outside the narrower definition of the word 'debtor' as given in sub-section (2)." (p. 620). At page 621 the court said : "IN sub-section (1) of section 30 of Punjab Act No. 7 of 1934 prohibition is against passing or executing. the decree in a suit in respect of a debt as defined in section 7 of this Act. Section 30 makes no reference to a 'debtor' as defined in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 of the Punjab Relief of Indebtedness Act, 1934, defines a 'debt' as inclusive of "all liabilities of a debtor in cash or kind, secured or unsecured, payable under a decree of order of a civil court or otherwise, whether mature or not.................... The definition of the expression 'debt' therefore includes all liabilities of a .debtor .in cash or in. kind, secured, or unsecured. The liability of a mortgagor to pay the money due under the mortgage and to ' pay interest accruing due is clearly a debt....... . It cannot be said that under the three mortgagees there was no debt due by the mortgagor. Nor do we agree with counsel for the mortgagee that the benefit: of section 30 of the Punjab Relief of Indebtedness Act is available only to the original mortgagor and not to his representatives." (p. 593). (15) The Supreme Court confirmed the view of the full bench. They agreed with the High Court that the definition of the term 'debt' as given in section 7(1) is an inclusive definition. The definition of the term 'debtor' in section 7(2) is' a narrower definition. The term 'debtor' as used in section 7(1) is a word of much ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was the Supreme Court ruling which affirmed the view of the full bench brought to his notice. Nor was he referred to the division bench ruling of Bhandari Cj and Falsaw J. Therefore this authority cannot be preferred to the view of the full bench which .received the imprimatur of the Supreme Court. (19) The definition of the term 'debt' in Section 7(1) is an inclusive definition. The High Court took this view. The Supreme Court affirmed it. "The word 'include' is generally used in interpretation clauses in order tol enlarge the meaning of words' or phrases occurring in the body of the statute. And when so used these words or phrases must be construed as comprehending, not only such things as they signify according to their natural import, but also these things which the interpretation clause declares that they shall include. In my view the word 'includes' as used in Section 7(1) is not a word of limitation. It mean what. it says' >that it includes the matters thereafter mentioned. It is a word of enlargement rather than of restriction. (20) INCLUDE' is a word to which parliamentary draftsmen seem considerably addicted. One reason for this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 94,917.14p on account of principal and interest till today on the sum advanced. The Corporation will also be entitled to Rs.' 1,10,694.65 on account of expenses incurred by them and interest thereon amounting to ₹ 97,000.00 . The Corporation will also be entitled to proportionate costs of the suit. The defendants are allowed a period of 6 months to pay the amount. The Corporation shall be entitled to simple interest at the rate of 71% p.a. till the date of payment on the amounts of ₹ 94,917.14 and Rs-. l,10,694.65p. (25) A sum of ₹ 39,595.36p. is in deposit with the Grind- leys Bank in account No. 182221. This is deposited by the receiver under the orders of the court. The bank will pay the amount of ₹ 39,595.36p. to the Life Insurance Corporation forthwith. Unused cheque book of the aforesaid account will be returned to the Corporation. (26) It is clarified here that this amount of Rs'. 39,595.36 has already been taken into account in arriving at the figures of ₹ 94,917.14 and ₹ 1,10.694.65 p. (27) Defendants have paid ₹ 10201- to the Oriental Fire and General Insurance Company Ltd. vide receipt No. 504786 dated 28th April ..... X X X X Extracts X X X X X X X X Extracts X X X X
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