S SUBRAMANIA AIYAR Vs. INDIA EQUITABLE INSURANCE COMPANY LIMITED, THROUGH ITS AUTHORISED AGENT SBMITRA

JUDGEMENT

(1.) THE contention raised in this petition under Madras Act IV of 1938 is one which, so far as I am aware, is not covered by authority, but it seems to me to be clearly untenable. THE petitioner was employed by the India Equitable Insurance Company, Limited, and he borrowed from his employers in 1927 a sum of Rs. 250 on a promissory note carrying interest at 12 per cent. per annum. In 1930 that debt was renewed by the execution of a fresh promissory note for Rs. 340 with interest at the same rate. In 1933 there was a further renewal by the execution of a note for Rs. 450 carrying interest at only 9 per cent. On this note the company sued and got a decree on 23 October, 1936. THE debtor applied to scale down this decree under Section 19 of the Act and has been met "by the objection that under Section 10 (2) (in) of the Act, nothing in Secs.8 and 9 applies to a liability in respect of a sum due to a public company when the interest payable in respect of the liability is not more than 9 per cent. THE argument advanced before me is that because the debt which has been decreed is itself a renewal of earlier debts carrying interest at 12 per cent., the explanation to Section 8 can be applied and that by the application of this explanation the liability becomes transformed into one bearing interest in excess of 9 per cent., so as to exclude it from the operation of Section 10 (2) (iii). That is to say, the petitioner proposes to apply Section 8 of the Act in order to make this liability into one to which Section 8 of the Act shall apply. This process seems to me unjustifiable. THE liability excluded from the purview of operations under Section 8 or 9 of the Act is the present liability under which the debtor is at the time of his application indebted. If that liability is clue to a company and carried interest at not more than 9 per cent., it is clearly excluded from the operation of Secs.8 and 9 and therefore these sections cannot be called in aid to substitute for this liability an earlier liability which bore a higher rate of interest. THE petition is dismissed with costs.