LEKSHMI PRASAD BANK LIMITED Vs. GOPALAKRISHNA IYER

JUDGEMENT

(1.) In this appeal against a second appeal, the plaintiff - appellant claims that the decision of Velu Pillai J. in second appeal is erroneous. The decision in second appeal in this case only follows another decision of Velu Pillai J. in Thomman v. Catholic Syrian Bank Ltd. ( 1964 KLT 62 ). Thus, the question before us is whether the said decision in Thomman's case is right.

(2.) The appellant is a banking company; and the company filed a suit against the respondent for a debt over Rs. 1,500/- after the commencement of Act XXXI of 1958. The suit was decreed allowing the respondent to pay the debt in instalments and refusing him his costs and directing him to pay the costs of the appellant. This was confirmed in appeal by the District Judge, but reversed by Velu Pillai J. in second appeal. Velu Pillai, J. held that S.3(2) of Act XXXI of 1958 applied to the case and therefore, the appellant was liable to suffer its own costs and to pay the costs of the respondents. It is the correctness of this decision that is in dispute.

(3.) The term 'debt' is defined in S.2(c) but several categories of debts are not included in the definition by the subsequent clauses (i) to (xi). The last of these clauses relates to a debt exceeding Rs. 1,500/- borrowed under a single transaction before the commencement of the Act from a banking company as defined by the Banking Companies Act, 1949 a debt similar to the one before us. A proviso is added to this clause which provides that in the case of such a debt exceeding Rs. 1,500/- due to a banking company, an agriculturist debtor shall be entitled to repay the debt in eight equal half yearly instalments as provided in sub-s.(3) of S.4. (The rest of the proviso is not relevant.) S.4(3) allows a debtor to pay his debt in half-yearly instalments, the first instalment to be paid during the six months following the commencement of the Act. In other words, the debtor gets six months to pay the first instalment and a further period of six months each for every succeeding instalment. The relevant S.3(2) may now be noted. S.3(2) enacts that where a creditor filed a suit for recovery of a debt before the expiry of six months from the commencement of Act, etc. or after the agriculturist has paid or deposited the same in instalments as specified in S.4 and during the period when he is so entitled to pay, the court shall decree the suit, but shall direct the plaintiff to pay his own costs and to pay the costs of the defendant agriculturist except in cases where the claim would have been barred by limitation if no suit were filed.