LAXMAN SONAJI KUMBHAR Vs. HARI NATHUJI GHODKE

JUDGEMENT

(1.) THE respondent Hari was indebted on a mortgage to Laxman, who is represented by the appellants. Hari applied to the Debt Conciliation Board to effect art amicable settlement between him and his creditors. A settlement was so effected on 28th September 1935. Hari's debt to Laxman on the mortgage was reduced from Rs. 1310 to Rs. 868 and made payable by 12 annual instalments, payable on 15th March in 1936 and the following years, subject to this condition: "In default of two instalments condition of foreclosure of the field survey No. 4." The instalments of 1936, 1937 and 1938 were paid, though not punctually; the instalment of 1939 has not yet been paid; the instalment of 1940 was recovered by the Deputy Commissioner under Section 13, Debt Conciliation Act; and the instalment of 1941 has not yet been paid. The creditors, contending that there had been a default of two instalments, applied to the civil Court to place them in possession of the above field or, if it was held necessary, to pass a final decree for foreclosure.

(2.) THE lower appellate Court has held that the application to the civil Court is untenable and that the creditors must first obtain a certificate under Section 13(3), Debt Conciliation Act. In Shridhar v. Narayan A.I.R. 1939 Nag. 227 a Division Bench of this Court expressed the view that if the amounts payable under the agreement are payable in cash, then the jurisdiction of the civil Courts does not arise until the provisions of Section 13(3) had been complied with. In S.S. Hukumchand v. Mahant Jivanpuri Misc. Appeal No. 171 of 1941, Decided on 14th July 1943, I stated that I disagreed with that view, which was an obiter expression of opinion in so far as it dealt with the amounts payable in cash, and I held that an agreement on registration takes effect from the date of registration as if it were a decree of a civil Court under Section 12(2), that it is executable as a decree, that Section 13(1), which gives the creditor a right to apply to the revenue authorities to recover any defaulted amount as an arrear of land revenue, merely gives a creditor an alternative remedy, and that Section 13(4) which provides in effect for a decree for the outstanding debt is not irreconcilable with Section 12(2) which provides in effect for a decree for the payment of instalments. To that view I adhere. In the present case the creditors do not wish to recover defaulted instalments and do not wish for a certificate that the agreement has ceased to subsist; they rely on the agreement and they ask that the property should be foreclosed in accordance with that agreement. In my opinion then it was open to the creditors to apply to the civil Court to enforce the agreement as a decree.

(3.) LASTLY , there is the question whether the creditors are entitled to be placed in possession of the mortgaged property straightway or whether a final decree should first be passed. I think that it is certainly open to the parties to the agreement to agree that the agreement should take effect as a preliminary or a final decree, and the question therefore is what the parties intended. That is by no means clear, but a preliminary decree followed by a final decree is the more usual procedure and I agree with the learned Additional District Judge that it has not been shown that the parties intended that the more unusual procedure of dispensing with a final decree was intended. The appeal is therefore allowed and the application will be returned to the original Court to be treated as an application for a final decree for foreclosure. Whether there is any ground for refusing such an application will be considered by that Court; I do not consider that it could be proper for me at this stage to deal with a point that was not dealt with in the original Court which took the view that no final decree was necessary. The respondent will pay the appellants' costs throughout. Cousel's fee in this Court Rs. 20.