CHACKO Vs. ROHINI CHANNATTI

JUDGEMENT

(1.) This case has been referred for decision by a Full Bench; and the facts of the case and the points to be determined are given in the order of reference given below:-

(2.) The debtor was regularly paying the amount due for each instalment till the 15th. The balance due under the decree found on calculation, was stated to be an amount which was less than what was fixed for each instalment. It was, therefore, argued that in this case the 16th instalment was the last instalment envisaged under the Debt Relief Act; and, if the balance was not paid before the last date, i.e., before 30th Chingam 1124, the debtor would forfeit all privileges conferred on him by the Debt Relief Act. If this position was accepted, the only effect would be that, against the provisions of the Debt Relief Act, the court would be shortening the period within which the debtor was entitled to discharge his debt. As could be seen form the several provisions under S.9 of the Debt Relief Act, the essential conditions are: (1) the amount to be deposited for each instalment is not to be less than six per cent of the debt, found due on the date of the Act or Rs. 10 whichever is larger; (2) 6% of the admitted debt should have been paid on or before 21st Edavom 1116 as the period for the payment of the 1st instalment had been extended to this date by a Proclamation; (3) the debtor, in case of doubt or dispute, should have paid the deficit, if any, in the instalments deposited within the time fixed by the court after settling the total amount of the debt and fixing the instalment under S.15; (4) the instalments are to be paid in such a way that there should be no consecutive defaults in the payment of 3 instalments; and (5) the entire debt is to be discharged within two, six or nine years as the case may be, if the debtor desires to get the debt deducted by thirty, twenty five, or twenty per cent. If all these conditions are satisfied, the debtor would not be a defaulter. Six per cent of the debt or Rs. 10, fixed for each instalment, was not for equating payment of the instalments. That was only laid down as the basis for a working principle. The only condition is that the amount, to be paid for each instalment, is not to be less than six per cent of the entire debt till the fixed percentage of the debt as provided for in S.9 is discharged. It is open to the debtor, as laid down in S.9 (4) of the Debt Relief Act, to make payment of any or all of the instalments before the due date. It is also open to him to pay something in excess of the amount due for each instalment and, in the case of such excess payments, it does not debar the debtor from claiming that the payment, made in excess should be appropriated and adjusted towards subsequent instalments as they fall due (see the decision in O. R. P. 823 of 1123) (22 T.L.T. 1.) So long as the debtor is careful to see that there are no three consecutive defaults after the 1st instalment he is safe, and he can discharge the entire debt, as in this case, within nine years, i. e., within the last day of Chingom 1125. It was seen in this case that the amount fixed for each instalment was 886 Fs. and 9 Cash; and, when a calculation was made, it was found that only 588 Fs. remained due when the last deposit for the 15th instalment was made. It is true that this balance was less than the amount fixed for each instalment. He is, therefore, entitled to pay the balance of 588 Fs. before the 18th instalment, i.e., before he commits three consecutive defaults; and, if he does so, he is safe.

(3.) Reference was made to the decision in S. A. 247 of 1122 for the position that the last instalment need not necessarily be on the last day of the second, the sixth or the 9th year, from the date of the Debt Relief Act. In that case, the debt to be discharged was less than Rs. 60 and the minimum for each instalment was Rs. 10; so that the whole debt could be discharged by six instalments. It was held in that case that the sixth instalment should be held to be the last. The sixth instalment fell on 31st Chingam 1119 and, since the last payment was only on 15th Mithunam 1119, it was held in that case that the debtor had forfeited the benefits of the Debt Relief Act. No doubt, he could not claim the benefit of the six years or the nine years provided for in S.9; but he should have been given the benefit of the Debt Relief Act if he had not committed three consecutive defaults within this period. To this extent, that decision does not appear to be correct; and we do not follow that portion of the reasoning which fixes the last date of instalment on 31st Chingam 1119. There was an argument that the instalments were to be calculated not as laid down in the Act but with reference to the previous payment. This question was the subject of consideration in Parameswaran Pillai v. Anandavalli Amma, 18 TLT 206 and, in considering the several provisions of the Act, the learned Chief Justice observed as follows in the course of the judgment:-