SATYANARAYANA Vs. VENKATANARASAYYA

JUDGEMENT

(1.) The plaintiff is the petitioner. His claim that since he is a creditor within the meaning of Section 3 (h) of Act 7 of 1977 he is "a person" under Clause (xii) of Section 3 (i) and as such the debt in question stands excepted from the operation of the act was put in issue, but negatived by the trial Court. The same is reiterated in this revision.

(2.) The facts lie in a short compass. The respondent executed the promissory note, Ex. A-1, dated October 18, 1975 favour of one M. Venkatarao. It was endorsed under Ex. A-2 purported to be dated October 2,1976, in favour of the petitioner for consideration and on foot thereof, he laid the suit for recovery of the debt due under the promissory note. The respondent while admitting the execution, put forward that he a small farmer and that the debt, by operation of Section 4 of Act 7 of 1977 is stands dischargtd and the proceedings in the suit abated. The trial Court accepted the plea of the petitioner that he is a holder in due course and the endorsement was made after the receipt of valuable consideration. It also held that the respondent is a small farmer, but did not accede to the claim of the petitioner that he is a person under Clause (xii) of Sec. 3 (i) of the Act and dismissed the suit. Thus the revision.

(3.) In this revision, it is not disputed that the respondent is a small farmer. But the petitioner claimed that having found him to be the holder in due course, the lower Court ought to have held that he is also a small farmer and that the debt is excluded from the Act by operation of Clause (xii) of Section 3 (i) thereof. Therefore the suit should have been decreed. In support thereof he contends that as a holder in due course, he is entitled to recover in his own right the debt under the promissory note. He is a creditor within the meaning of Section 3 (h) of the Act. It is an inclusive definition taking within its ambit an assignee and he stepped into the shoes of the principal creditor. So he becomes "a person" within the meaning of Clause (xii) of Section 3 (i). He being a small farmer the Act takes the debt out from its purview. He reliss upon the decisions of this Court in G. Basavaiah vs. Nalamothu Venkamma and Abdul Aziz vs. Golla Bhumavva