MATA BADAL PANDEY Vs. BOARD OF REVENUE

JUDGEMENT

(1.) ONE Drig Vijai Bahadur Singh, a Zamindar took a loan on the foot of a promissory note executed by him in favour of Mata Badal Pandey and Krishna Murari The promissory note remained unpaid when the executant thereof applied for liquidation of his debts under the U. P. Encumbered Estates Act, hereinafter referred to as the 'Act' A Special Judge I Grade on 20-4-1937 passed a decree under Sec.14 of the said Act, which decree was eventually modified by the Chief Court at Lucknow on 14-2-1942 and a sum of Rs. 3,380 plus costs, Rs. 64 and Rs. 110/3/- as interest were found due, The decree was to carry future interest at the rate of 41% per annum upto the date of realisation. The said decree was transmitted to the Collector for execution under Section 19 of the said Act. During the pendency of the execution proceedings U. P. Zamindari Abolition and Land Reforms Act came into force. All the landed properties of the Zamindar respondent were acquired and he was awarded compensation and rehabilitation grant bonds. Drig Vijai Bahadur Singh died and was succeeded by his son Ran Vijai Bahadur Singh, who was substituted for his father in the execution proceedings. The compensation bonds payable to Ran Vijai Bahadur Singh were sent by the Compensation officer on 28-12-56 to the Collector under Section 23-A of the Act. There were certain secured debts also against the Zamindar respondent and they were first ordered to be paid off under Section 23-B (1) of the Act realisable from the compensation bonds on their face value. The Collector then proceeded to liquidate the unsecured debts under Section 23-B of the Act from the balance of compensation bonds. There arose some dispute as to the calculation of the interest at the decretal rate. The Collector further reduced the debt under Section 9 of the U. P. Zemindar's Debt Reduction Act of 1952 despite the objection raid by the decree-holder that the debt in question being an unsecured debt could not be reduced by the Collector. The creditors then went up in appeal before the Commissioner but it was substantially dismissed with a slight modification as regards the interests payable. The creditors then filed a revision before the Board of Revenue on the ground that the Collector had no jurisdiction to reduce the debt in question. The Board of Revenue held that the Collector had jurisdiction to reduce the debt but set aside that part of the order of the Commissioner by which interest upto the date of award was granted in terms of the decree and restored the order of the Collector for grant of interest upto 30-6-1952. The judgment of the Board of Revenue after concurrence of another member was finally delivered on 31-3-1962. A review application filed by the creditors against the judgment of the Board of Revenue was also dismissed on 23-10-1962. The creditors Mata Badal Pandey and Krishna Murari then filed a writ petition in this Court under Article 226 of the Constitution impugning the order of the Board of Revenue and all the proceedings leading to the revision before the Board of Revenue. Ran Vijai Bahadur Singh was impleaded as respondent No. 4 to the writ petition, the Board of Revenue, the Additional Commissioner and the Collector, being respondents Nos. 1, 2 and 3, respectively. The writ petition was contested by Ran Vijai Bahadur Singh. The main question which arose in the writ petition revolved round the controversy whether Section 9 of the U. P. Zamindar's Debt Reduction Act applied and the Collector in liquidating the unsecured debts under the Encumbered Estates Act had jurisdiction to reduce such debts. A subsidiary question of award of interest was also raised. The learned Single Judge by his Judgment dated 27-10-65 dismissed the writ petition holding that Section 9 of the Zamindars' Debt Reduction Act was applicable to the execution of a decree for unsecured debts under Chapter V of the U. P. Encumbered Estates Act when realised against compensation and rehabilitation grant bonds. The learned judge also upheld the view that interest could be calculated upto 1952 determined by the Board of Revenue. The petitioner-creditors being aggrieved then filed a Special Appeal from the aforesaid decision of the learned Single Judge. On hearing the learned counsel for the parties, the Division Bench felt that the matter was not free from difficulty and referred the following two questions to a Full Bench:- "1. Whether benefit of Section 9 of the U. P. Zamindar's Debt Reduction Act, 1952 should be available to a judgment-debtor in the proceedings under Chapter V of the U. P. Encumbered Estates Act?

(2.) WILL it make any difference if the bonds are suo motu sent by the Compensation Officer to the Collector instead of being requisitioned by the Collector?" 2. No question was referred by the Division Bench as regards the award of interest. This is how the matter has come before the Full Bench.

(3.) WITH the above answer of the larger Full Bench the parties addressed before us their arguments. For the sake of convenience, we, hereinafter, describe the U. P. Encumbered Estates Act, 1934, as 'the 1934 Act' and the U. P. Zamindars' Debt Reduction Act, 1952, as 'the 1952 Act'.