TaxTMI 
TaxTMI 
1982 (8) TMI 223
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....Act XV of 1976. Section 2(b) defines "agriculturist" and the same is as follows: 2(b). "agriculturist" means a person who owns an interest in agricultural land, and who, by reason of such interest, is in possession of such land or is in receipt of the rents or profits thereof and shall include a lessee; but shall not include- (i) a firm registered under the Indian Partnership Act, 1932, or a company as defined in the Companies Act, 1956, or a corporation formed in pursuance of an Act of Parliament of the United Kingdom or of any special Indian Law, or (ii) any person who was assessed to income-tax under the Income-tax Act, 1961, or to agricultural income-tax under the Tamil Nadu Agricultural Income-tax Act, 1955, or to sales tax under the Tamil Nadu General Saks Tax Act, 1959 or under the Central Sales Tax Act, 1956, in any of the years 1971-72, 1972-73, 1973-74 and 1974-75. Section 2(c) defines "debt" and the same reads as follows: 2(c). "Debt"- (i) means any sum of money which a person is liable to pay under a contract (express or implied) for consideration received; and (ii) includes rent in cash or kind which a person is ....
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....decree was for one year from the commencement of the said Act which was subsequently extended by the subsequent enactments. The total period during which the institution of suits or applications has been stayed as per the above enactments is two years and six months, i.e., from 15th January, 1976 to 15th July, 1978. The conflict of view can now be briefly noted. 3. In Sri Hari Babu Naidu v. S. Alamelu Ammal , Ratnam, J., following an earlier ruling of Mohan, J., in C.R.P. No. 1806 of 1976, dated 8th July, 1977 (un-reported) came to the conclusion that any suit instituted after the commencement of Act XV of 1976 cannot be dismissed but will have to be stayed till the moratorium prescribed under the Act comes to an end. This view has been subsequently agreed to by Balasubrahmanyan, J., in the case reported in Smt. M.K. Srimathi Ammal v. P. Chellammal and Anr. . 4. But in Sarada Ammal v. V.S.M. Veerappa Chettiar (1975) T.L.N.J. 75, Ismail, J., as he then was, held that a suit instituted subsequent to the coming into force, of the aforesaid Act XV of 1976, will have to be dismissed following an earlier decision of Rajagopalan, J., in R.M.M. Ramanathan Chettiar v. Ramaswami Pillai....
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....as no provision in Act V of 1954, analogous to Section 3(2) of the Madras Indebted Agriculturists Repayment of Debts Act (I of 1955). Nonetheless, I am unable to accept the contention of the learned Counsel for the petitioner, that where a suit was instituted in contravention of Section 3 of Act V of 1954, the Court in which such a suit was instituted had no option but to keep it pending, and it is not liable to be dismissed. A claim which contravened an express statutory provision could only be dismissed. That the express statutory provision in this case was really one governing the procedure made no difference to the principle to apply. For example a claim barred by the law of limitation can only be dismissed. The next case on this question is a Full Bench decision of the Kerala High Court in Alikutty Sahib v. Cherian and Ors. (F.B.), where the Full Bench considered a similar case arising under Section 3 of the Madras Act (V of 1954). The reference to the Full Bench was made by a Division Bench of the Kerala High Court while considering an appeal against the Judgment of Sankaran, J., holding that Section 3 was not an absolute prohibition against the institution of suit against....
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....ts instituted after Act (V of 1954), came into force. We may in this connection observe that the conclusion reached by us is in consonance with the decision of the Madras High Court in Palanichami Chettiar v. Reliance Bank of India Limited (1956) 2 M.L.J. 1 : 69 L.W. 440, which Sankaran, J., declined to follow. In our opinion Bhadsha Stores v. P.V.K. Govindan Kutty , does not lay down the law correctly. Thus the Full Bench came to the conclusion that the dismissal of the suit by the trial Judge was proper. In a subsequent case reported in Sarada Ammal v. S.M. Veerappa Chettiar (1978) T.L.N.J. 75, arising under Section 3 of Act (XV of 1976), Ismail, J., as he then was, following the decision of Rajagopalan, J., reported in R.M.M. Ramanathan Chettiar v. Ramaswami Pillai and Anr. , came to the conclusion that the dismissal of the suit instituted in contravention of Section 3 of Act (XV of 1976) is correct. The reasons given by Ratnam, J., in Sri Hari Babu Naidu v. S. Alamelu Ammal , in sup port of his conclusion that the suit instituted in contravention of Section 3 of Act (XV of 1976).... will have to be stayed and not dismissed are as follows: 1. The controversy ha....
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....e hearing. But once the period under Sections 3 and 4 expired there was no bar to the Court taking up the proceedings from where they were left off. When this is the effect of Section 4 with reference to pending suits against agriculturists the position would not possibly have been conceived to be different when Section 3 happened to be enacted in the same statute to sub-serve the same legislative object. It would be incongruous to hold that the legislature intended that suits for recovery of debts which were pending against agriculturists at the commencement of the Act should be proceeded with after the expiration of two years and six months, but at the same time entertained a different intention to the effect that similar suits instituted during the period of the moratorium must nevertheless be dismissed. 8. In short the reasoning of the learned Judge on the question is that whatever may be the wording of Section 3, in applying that provision we must go by the intention of the legislature rather than the actual wording of the section. But according to well-known canons of construction Courts are bound to apply the section as it exists without making any variations, even if suc....
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....e temporary operation of the bar, although on every occasion the duration of the bar was being enlarged little by little. The other feature which emerges from the succession of Ordinances and legislative enactments on the subject relates to the avowed object of the Act. The object was no more than to give a breathing time to agriculturists in order that they may be the better enabled to discharge their obligations without any financial embarrassment or difficulty. The basic conception which underlines both Sections 3 and 4 is the same and this scheme of the Act is further underlined by the avowed object of the Act. A reference was also made by the learned Judge to Section 5 which protects persons who bona fide believed that Section 3 applied to their suit claims and in that belief refrained from instituting their suits within time. In case where the Court held that a suit had been instituted in contravention of the bar under Section 3 of Act (XV of 1976) there is nothing in the Act to suggest that the Court could not get on with the trial of the suit on other issues, seeing that the section no longer presents any obstacle to such a course. In such a situation, the effect of the Cou....
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....am, J., in toto in coming to a similar conclusion in Smt. M.K. Srimathi Ammal v. P. Chellammal and Anr. (1982) 1 M.L.J. 315. 15. The view expressed by Ratnam, J., based upon the presumed intention of the legislature that there cannot be one rule for the suits instituted before the commencement of Act XV of 1976 and another rule for the suits instituted after the commencement of the Act does not find support in the provisions of the Act. As per Section 4 of Act XV of 1976 all the proceedings pending at the commencement of the Act will have to be stayed for the period prescribed under the Act. As per Section 3 of Act XV of 1976 no proceedings shall be instituted against any agriculturist for recovery of a debt. Thus the Act has made distinct and separate provisions with reference to the suits instituted after the commencement of the Act and the suits pending at the time of commencement of the Act. A reading of Sections 3 and 4 clearly indicates the intention of the legislature as to what is to be done in respect of pending suits and in respect of suits to be instituted thereafter. We cannot relying upon the provision made in respect of suits pending at the time of commencement of ....
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.... to the Act it cannot be dismissed since there is no express provision for the dismissal of such a suit does not appear to be correct. As observed by the Full Bench of the Kerala High Court in Alikutty Sahib v. Cherian and Ors. , the expression that "no suit for the recovery of a debt shall be instituted..."is an absolute embargo on the institution of a suit for recovery of a debt from an agriculturist and the Court has jurisdiction to dismiss it if it comes to a conclusion that the bar to the, institution of the suit is attracted. There may be cases where the parties are at issue on, the question whether the defendants are agriculturists. In such a case the Court is bound to try the issue and if it finds that the defendants are agriculturists, it has jurisdiction to dismiss the suit. When the bar to the institution of the suit is absolute an express provision in the statute for dismissal of the suit is unnecessary. This decision of the Full Bench of the Kerala High Court had not been noted by the learned Judge. We are inclined to adopt the view expressed by the Full Bench and the decisions of Rajagopala Iyengar, J. Rajagopalan, J. and Ismail, J., referred to above, and hold that t....
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....ct. Venkateswarlu (supra), read in its statutory setting, falls in this category. Where a cause of action is deficient but later events have made up the deficiency, the Court may, in order to avoid multiplicity of litigation, permit amendment and continue the proceeding, provided no prejudice is caused to the other side. All these are done only in exceptional situations and just cannot be done if the statute, on which the legal proceeding is based, inhibits, by its scheme or otherwise, such change in cause of action or relief. The primary concern of the Court is to implement the justice of the legislation. Rights vested by virtue of a statute cannot be divested by this equitable doctrine see Chokalingam Chetty v. Seethai Achi (1928) 54 M.L.J. 88 : 27 L.W. 1 : A.I.R. 1927 P.C. 252. The law state in Ramji Lal v. The State of Punjab I.L.R. (1966) Punj. 125, is sound: Courts do very often take notice of events that happen subsequent to the filing of suits and at times even those that have occurred during the appellate stage and permit pleadings to be amended for including a prayer for relief on the basis of such events but this is ordinarily done to avoid multiplicity of proce....
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....51 to return the plaint which under law cannot be entertained by the Court. For instance if a plaint filed indicates that it is for the recovery of a debt due from an agriculturist the institution of which is barred under Section 3 of Act (XV of 1976), the proper order would be to return the plaint asking the party to explain as to how the suit is maintainable. It may be argued that in such cases the Court will have to reject the plaint and not return it. As already pointed out Section 5 provides for a case of a plaintiff bona fide believing the defendant to be an agriculturist and refraining from filing a suit. But there is no provision in the Act providing for a case of plaintiff bona fide believing the defendant not to be an agriculturist and filing a suit. In the latter case to meet the ends of justice, especially after the bar to entertain the suit has ceased to operate, the Court can direct the return of the plaint under Section 151 for representation in the same Court with a view to relieve the hardship that may be caused to the plaintiff because of their bona fide mistake. Under its inherent jurisdiction under Section 151 and the power available to the Court to shape the re....