RAM RAM SINHA CHOWDHURY Vs. NITAI CHANDRA GHOSE

JUDGEMENT

(1.) The facts out of which this civil revision application and the miscellaneous appeal arise are these. The plaintiffs-opposite party in this case, Nitai Chandra Ghose, had advanced a sum of rupees two thousand on two simple mortgage bonds dated 5-5-31 and 7-5-31 to the petitioner-defendant in this case. On the principal and interest not being paid, Nitai Chandra Ghose brought a suit on the basis of the said two bonds against the defendant-petitioner in the Court of 3rd Sub-Judge of Patna, for a sum of Rs. 8500. The reason why the suit was brought in Patna was that there was stipulation in the bonds that the money loaned to the defendant was to be paid in Patna and thus the Court at Patna got jurisdiction over this matter, though the bonds were executed in Murshidabad and a part of the contract was fulfilled there. After contest, there was a decree for rupees four thousand passed by the Court on 15-4-40 in favour of the plaintiffs against the defendant in accordance with the provisions of Bengal Money-lenders Act of 1933, according to which a sum not more than the principal was to be decreed for interest whatever the stipulations in the contract might have been. The plaintiffs-decree-holders executed the decree and the execution proceedings were transferred to the District Judge of Murshidabad, and execution was started in the Court of the Subordinate Judge at Berhampur, district Murshidabad. It appears that the execution proceedings there lingered on account of various objections and in 1943 the defendant-petitioner filed an application before the executing Court at Berhampur purporting to be Under Section 11 and 13, Bihar Money-lenders Act, and Section 36, Bengal Money-lenders Act (Act X [10] of 1940) which had come into operation on 1-9-1940. This application was rejected by the executing Court and an appeal was filed by the petitioner-defendant before the Calcutta High Court which by its judgment and order dated 12-4-1945 dismissed the appeal and held that the Bengal Courts had no jurisdiction to reopen the decree which was passed by a Bihar Court. On 8-6-1945 an application Under Section 34 and 36, Bengal Money-lenders Act (Act X [10] of 1940) was filed by the petitioner-defendant in the Court of the 3rd Sub-Judge at Patna. The gist of this application was that the petitioner-debtor sought further relief from the obligations of the decree by way of some further reduction in interest and thus an application was made to reopen the decree and request was made by this application to further reduce the interest and to fix instalments for payment of the reduced decretal amount. By its judgments dated 27-11-1946, the Court of the 3rd Sub-Judge at Patna rejected this application of the petitioner-judgment-debtor and hence an appeal and a revision have both been filed against the said judgment and order.

(2.) Before the lower Court both the parties agreed to the application of the provisions of the Bengal Money-lenders Act of 1940 to this case as the transaction had taken place within the province of Bengal and as the defendant was a resident of Bengal. Though the learned Subordinate Judge decided this case on the basis of the parties conceding on this point he expressed his doubts as to the correctness of the proposition. In this Court the learned advocate for the plaintiffs-decree-holders has urged that the Bengal Money-lenders Act cannot govern this case as the decree in this case has been passed by a Court in Bihar and it is the Bihar Money-lenders Act, which would give powers to a Bihar Court for scaling down decrees and note the Bengal Act. It may be noted that this petition was filed before the Court of the 3rd Sub-Judge at Patna Under Section 34 and 36, Bengal Money-lenders Act, and if that Act is found incapable of governing Bihar Courts the application has to be rejected. I propose, therefore, to consider this aspect of the matter also in spite of agreement between the parties in the Court below to have the matter decided according to the provisions of the Bengal Money-lenders Act. To my mind agreement on such points of law cannot by itself vest jurisdiction in a Bihar Court to apply the provisions of a law of the Bengal Legislature to the case. The learned advocate for the petitioner- judgment-debtor has cited before us the case reported in State Aided Bank of Travancore Ltd. v. Dhrit Ram A. I. R. (29) 1942 P. C. 6 : (I. L. R. (1942) Bom. 318), which says that in cases arising out of contract it is the place of contract which governs the law applicable to it and not the place where the suit is brought. That was a case in which the contract had been found to be fully entered into in the Native State of Travancore and the suit had been brought in Bombay. In order to determine the right and liabilities of the parties arising out of the contract it was held in that case that the law of the State of Travancore where the transaction-of the contract had been fully entered into was the proper law applicable to it. We have also been shown some observations in Westlake's Private International Law which says that the law of the country where the contract was entered into will govern cases arising out of the contract. Even if I were to agree to this principle of law, it appears, and it is conceded, that the contract entered into between the plaintiffs and the defendant on the basis of the two bonds was performed partly in the district of Murshidabad, namely in Bengal and partly it had to be fulfilled in Patna where the plaintiffs-decree-holders reside inasmuch as the stipulation in the bonds was that the repayment of the loans due on the bonds was to be made in Patna. That is why the Court at Patna got jurisdiction over this matter. Therefore, even applying the principles enunciated in the Privy Council case, cited before us, the Bihar Court had jurisdiction in this matter and it passed a decree apparently without objection on the question of jurisdiction. But this is not all. The analogy of a contract will hardly apply to the circumstances of this case. The decree in this case arising out of that contract based on the two bonds was passed on 15-4-1940 by the Court of the 3rd Subordinate Judge at Patna and whatever the rights and liabilities of the parties were based on that contract had already been decided by that judgment and decree and the contract had merged in the decree. There was nothing more about the rights and liabilities arising out of the contract to be decided. On 1-9-1940, a law came into force, passed by the Bengal Legislature, which Under certain circumstances gave rights to a debtor to apply before a Court, either before the passing of a decree or during execution proceedings, to move for scaling down of the decree and to fix periods of payment. This was a right given to the debtor not accruing to him from any contract but as a result of a special law which vested Courts with a jurisdiction to scale down decrees and to grant instalments for payment of the decrees on the request of the debtor. It cannot be said that this right arose because of the contract, and as such it cannot be said that the place of the contract was the determining factor in applying the law governing it. The Bengal Legislature had vested its Courts with special jurisdiction and responsibilities in the matter of scaling down decrees. Can the Bengal Legislature make special laws of this kind applicable to Bihar Courts and can they command the Bihar Courts to enforce the provisions laid down in their legislation in such cases ? This is an intricate question. The Bengal Moneylenders Act and the Bihar Money-lenders Act are special laws vesting their Courts with jurisdiction over reviewing and revising decrees already passed in the matter of scaling down of interest or fixing of instalments. To my mind such Provincial legislations can bind and affect Courts within their jurisdiction and a Court in Bihar cannot be forced to apply the Bengal Money-lenders Act to a decree which it had passed. A Bench of this Hon'ble Court has held Inder Chand v. Bansropan Sahu, A. I. R. (35) 1948 Pat. 245 : (26 Pat. 307) in a case where a decree was obtained in the original-side of the Calcutta High Court and it was transferred for execution to the Shahabad Court in the Province of Bihar that the transferee Court has to execute it in accordance with the law of procedure obtaining in the Courts in Bihar but it has to determine the rights and liabilities of the parties in accordance with the substantive law obtaining in the Court which passed the decree, that is, the transferor Court. In that case the judgment-debtors had made an application Under Section 13 and 14, Bihar Moneylenders Act, and they applied to the Court to fix a valuation about the properties of the judgment-debtors and to sell only a small portion of the judgment-debtors' properties which are rights given to a judgment-debtor under the Bihar Money-lenders Act (Act VII [7] of 1939). The Bengal Money-lenders Act excepts commercial loans from the operation of the Bengal Money-lenders Act and the question in that case was whether the Bengal Act or the Bihar Act would apply. The Subordinate Judge in that case had held that the Bihar Moneylenders Act applied to the transaction and in appeal Meredith and Sinha JJ. reversed the decision of the Subordinate Judge and held that in matter where the question was about the determining of the rights and liabilities of the parties the law of the land which passed the decree was to govern. Meredith J. has observed the following in his judgment :

(3.) In this view of the matter, it is unnecessary to decide whether Under Section 36, Clause (6) (a) (i), Bengal Money-lenders Act, it was open to the lower Court to scale down the decree when no proceedings in execution were pending before it; or whether Under Section 34 it was competent for the lower Court to fix instalments under the Bengal Money-lenders Act. I would, therefore, dismiss this application for civil revision and the miscellaneous appeal with costs to the decree-holders-opposite party. There will be no separate hearing-fee for this civil revision. Das, J.