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  • provisions of s. 34 of the Bengal Agricultural Debtors Act
  • ss. 8 and 13 of the Bengal Agricultural Debtors Act
  • BENGAL AGRICULTURAL DEBTORS ACT
  • s. 34 of the Bengal Agricultural Debtors Act, 1935,
  • s. 34 of the Bengal Agricultural Debtors Act
  • s. 34, Bengal Agricultural Debtors Act, 1935,
  • s. 34, Agricultural Debtors Act.
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Citation Codes
Equivalent Citations
citation codes
Case Number
Advocates
Judges
Acts
  • provisions of s. 34 of the Bengal Agricultural Debtors Act
  • ss. 8 and 13 of the Bengal Agricultural Debtors Act
  • BENGAL AGRICULTURAL DEBTORS ACT
  • s. 34 of the Bengal Agricultural Debtors Act, 1935,
  • s. 34 of the Bengal Agricultural Debtors Act
  • s. 34, Bengal Agricultural Debtors Act, 1935,
  • s. 34, Agricultural Debtors Act.
Smart Summary

Factual and Procedural Background

This opinion arises from a Rule under s. 115 of the Code of Civil Procedure to consider whether the Fifth Munsif of Dacca had failed to exercise his jurisdiction or had exercised it improperly in respect of two linked courtroom proceedings.

The factual sequence as stated in the opinion is:

  • Rash Mani Dasee and two others (the decree-holders) obtained a decree against the judgment-debtor Jaga Bandhu.
  • The judgment-debtor's property was put up for sale in execution of that decree; the decree-holders bid and purchased the property for about Rs. 700, while the decretal amount then exceeded Rs. 800.
  • Jaga Bandhu brought a suit to have the sale set aside; that suit was dismissed for non-prosecution and the sale was confirmed. Those proceedings were Possession Case No. 42 of 1933.
  • Subsequently the decree-holders commenced Execution Case No. 73 of 1936 to realise the remainder of the decretal amount (the balance after the auction purchase).
  • Pursuant to the Bengal Agricultural Debtors Act (1935), the debtor (claiming to be an agriculturist) applied to a Settlement Board; the Board, invoking ss. 8 and 13(1) and s.34, sent a notice to the Court stating that an application/statement included a debt in respect of which Execution Case No. 42 of 1933 and Miscellaneous/Execution Case No. 73 of 1936 were pending.
  • The learned Munsif stayed proceedings in Miscellaneous/Execution Case No. 73 of 1936 on receipt of the Board's notice but declined to stay proceedings in Case No. 42 of 1933 (which, at that stage, concerned claim for possession of the property purchased by the decree-holders).
  • A Rule under s. 115 was obtained to challenge whether the Munsif's action in staying one proceeding and not the other was proper.

Legal Issues Presented

  1. Whether, upon receipt of the notice issued under s. 34 of the Bengal Agricultural Debtors Act, the learned Munsif was bound to stay both Execution/Possession proceedings (Case No. 42 of 1933 and Case No. 73 of 1936) that were mentioned in the notice.
  2. Whether a proceeding for delivery of possession started by an auction-purchaser (here, the decree-holders) constitutes a proceeding "in respect of" a debt such that s. 34 of the Bengal Agricultural Debtors Act applies (i.e., whether such a proceeding can be stayed or abated under s. 34 when a Board takes up the debtor's application).

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Kailash Chandra Tarapdar v. Gopal Chandra Poddar (Full Bench) That a proceeding for delivery of possession by an auction-purchaser may be a proceeding in execution within the meaning of s. 47 of the Code of Civil Procedure. The court (Mukherjea, J.) acknowledged that the cited Full Bench authority held such possession proceedings could fall within s. 47 of the CPC, but distinguished that classification from the narrower requirement of s. 34 of the Bengal Agricultural Debtors Act. The court held that even if a possession-proceeding is an "execution" proceeding, it is not necessarily a proceeding "in respect of" a debt for the purposes of s. 34 if the debt had been satisfied by the auction-sale.

Court's Reasoning and Analysis

The court's analysis proceeded in discrete steps, grounded in statutory provisions and the sequence of events:

  1. Identification of statutory framework:
    • The court cited Order XXI, rule 92(1) of the Code of Civil Procedure (confirmation of sale where certain applications are not made or are disallowed) and section 65 of the Code (vesting of immovable property in purchaser from time of sale when sold in execution).
    • The court set out s. 34 of the Bengal Agricultural Debtors Act, which provides that when a Board's application or statement includes any debt in respect of which a suit or other proceeding is pending, the Board shall give notice to the Court and the suit or proceeding shall be stayed until the Board dismisses the application in respect of that debt or makes an award thereon; if the Board includes part of the debt in its award or decides that the debt does not exist, the suit or proceeding shall abate so far as it relates to such debt.
  2. Application of Code provisions to the facts:
    • Applying O. XXI, r. 92 and s. 65 to the auction sale and the unsuccessful suit to set aside the sale, the court concluded that title to the property sold at auction vested in the decree-holders from the time of sale (and therefore a portion of the debt was satisfied to the extent of the purchase price, about Rs. 700).
    • The fact that the decree-holders had not yet obtained physical possession at the time the Board's notice arrived was held to be immaterial to the legal effect of vesting under s. 65.
  3. Distinguishing the two pending proceedings:
    • Case No. 73 of 1936 related to realisation of the remaining balance of the decretal amount after the auction, and thus was a proceeding "in respect of" a debt that still existed. Under s. 34, a notice from the Board referring to that debt required that proceeding to be stayed until the Board concluded its process. The learned Munsif's stay of Case No. 73 was therefore correct.
    • Case No. 42 of 1933, by contrast, concerned a claim for possession of the property already purchased at auction; the court viewed those proceedings as not being proceedings founded upon a debt that remained in existence at the time of the Board's notice. Because the relevant portion of the debt had been satisfied by the sale and the auction-purchasers' title had become absolute prior to the application under the Act, s. 34 did not apply to stay Case No. 42.
  4. Additional observations by Mukherjea, J.:
    • Mukherjea, J. agreed with the Chief Justice and emphasised that the condition precedent for the Board to issue a notice under s. 34 is the inclusion of a debt in the petition under ss. 8 and 13 in respect of which a suit or proceeding is pending.
    • He noted that where a debt was satisfied by an auction-sale prior to the passing of the Act and prior to the application, the Board would have no jurisdiction to revive that debt by setting aside the execution sale; thus proceedings solely for delivery of possession would not be proceedings "in respect of" a debt within s. 34.
    • He further relied on the concluding words of s. 34 which say that if the Board decides the debt does not exist the suit or proceeding shall abate so far as it relates to such debt—an observation used to support the court's construction that the provision contemplates proceedings that are truly for recovery of a debt.

Holding and Implications

Holding:
Rule discharged.

Direct consequences and implications for the parties:

  • The learned Munsif acted correctly in staying Execution Case No. 73 of 1936 (the proceeding for recovery of the balance of the decretal amount) upon receipt of the Board's notice under s. 34 of the Bengal Agricultural Debtors Act, because that proceeding related to a debt which then remained outstanding and was included in the Board's application.
  • The learned Munsif acted correctly in declining to stay Case No. 42 of 1933 (the possession proceeding), because that proceeding was not, in the court's view, a proceeding "in respect of" a debt within the meaning of s. 34—the relevant portion of the debt had been extinguished by the earlier auction-sale and confirmation.
  • Costs were awarded against the party who obtained the Rule: hearing fee two gold mohurs was directed.

Broader legal impact: The opinion confines itself to statutory interpretation and application to the facts; it does not purport to announce a new general principle of law beyond the present construction and application of s. 34 of the Bengal Agricultural Debtors Act to the factual situation of a prior confirmed auction-sale. No broader precedent is expressly claimed to have been established by this decision beyond the result on the facts before the court.

    Jaga Bandhu Shaha v. Rash Mani Dasee

    Derbyshire, C.J:— In this matter a Rule had been obtained under s. 115 of the Code of Civil Procedure for the purpose of considering whether the Fifth Munsif of Dacca had either failed to exercise his jurisdiction or exercised his jurisdiction improperly.

    The circumstances were these: One Rash Mani Dasee and two other persons had obtained a decree against the judgment-debt or Jaga Bandhu. The property of Jaga Bandhu was put up to sale in execution of that decree. The judgment-creditors bid and bought the property for about Rs. 700. The debt at that time was for something over Rs. 800. Jaga Bandhu brought a suit to have the sale of the property declared null and void. That suit was dismissed for non-prosecution and the confirmation of the sale followed in the usual way. Those proceedings were in Possession Case No. 42 of 1933. After that the decree-holders started Execution Case No. 73 of 1936 to realise the remainder of the decretal amount. The decree-holders apparently did not get possession of the land they had bought at the auction sale as proceedings were drawn out and eventually, in 1936, the Bengal Agricultural Debtors Act came into operation and the debtor who claimed to be an agriculturist took steps under that Act to have his affairs dealt with by a Settlement Board. That Settlement Board forwarded a notice to the Court in which the above execution proceedings were still pending.

    The notice was in this form:—

    I am giving notice under s. 34, Bengal Agricultural Debtors Act, 1935, that the Board has received an application under ss. 8 and 13(1) of the Act which includes a debt payable by one Jaga Bandhu Shaha, son of late Dasa Rath Shaha of Arania, in respect of which, between the decree-holders Rash Mani Dasya, Bijay Chandra Shaha and Birendra Chandra Shaha, and the judgment-debtor, aforesaid Execution Case No. 42 of 1933 and Miscellaneous Case No. 37 of 1936 are pending in your Court.

    Miscellaneous Case No. 37 of 1936 is the same as No. 73 of 1936. The learned Munsif proceeded to deal with the matter according to law and, in so doing he stayed the proceedings in Miscellaneous Case No. 73 of 1936, but declined to stay them in the Case No. 42 of 1933. In the Case No. 42 of 1933, the only matter pending now is claim for possession of the property purchased by the decree-holders. Case No. 73 of 1936 is an ordinary execution case for, as I have stated earher, the balance of the money owing after the decree-holders had purchased the property put up for sale.

    The provisions of the Bengal Agricultural Debtors Act are somewhat novel. This Act was passed for the purpose of enabling the debts of agriculturists in Bengal to be dealt with in such a way that the debtors could have some hope of paying their debts. For that purpose, Boards were brought into being and given powers, limited it is true, of adjusting the indebtedness between the parties.

    Section 2(8) defines “debt” as including:—

    All liabilities of a debtor in cash or in kind, secured or unsecured, whether payable under a decree or order of a civil Court or otherwise, and whether payable presently or in future, but does not include……………..

    Then follow a number of liabilities which are excluded from the meaning of the word “debt.” We are not concerned with these exceptions.

    Section 8 provides::—

    Subject to the provisions of s. 9, a debtor may make an application for the settlement of his debts to a Board established for the local area within which he ordinarily resides within five years after the first Board is established.

    With s. 9, we are not concerned.

    Section 13(1) provides for further statement of debts by the debtor and creditors.

    Section 34 provides:—

    When an application under s. 8 or a statement under sub-s. (1) of s. 13 includes any debt in respect of which a suit or other proceeding is pending before a civil or revenue Court, the Board shall give notice thereof to such Court in the prescribed manner, and thereupon the suit or proceeding shall be stayed until the Board has either dismissed the application in respect of such debt or made; an award thereon, and if the Board includes any part of such debt under cl. (d) of sub-s. (1) of s. 25 in the award, or the Board decides that the debt does not exist, the suit or proceeding shall abate so far as it relates to such debt.

    It was contended before the learned Munsif, as it is contended before us, that under that section on receipt of the notice which I have read out, the learned Munsif ought to have stayed both these proceedings. I think it is necessary to look at the position which arose when the judgment-creditors bought the judgment-debtor's property at the auction and subsequently when proceedings were taken to set aside the sale which failed.

    Order XXI, r. 92(1) of the Code of Civil Procedure says:—

    Where no application is made under r. 89, r. 90 or r. 91, or where such application is made and disallowed, the Court shall make an order confirming the sale, and thereupon the sale shall become absolute.

    Section 65 of the Code of Civil Procedure says:—

    Where immovable property is sold in execution of a decree and such sale has become absolute, the property shall be deemed to have vested in the purchaser from the time when the property is sold and not from the time when the sale becomes absolute.

    It appears to me, applying O. XXI, r. 92 and s. 65 to the facts of that auction sale and the proceedings to set it aside in 1933, that the property of the judgment-debtor sold at auction and purchased by the decree-holders vested in the decree-holders from the time of the sale. That being so, a part of the debt of the judgment-debtor to the judgment-creditors was at the time satisfied, i.e, to the extent of Rs. 700 or so.

    It is true they had not yet obtained possession of the land at the time the notice under s. 34 of the Bengal Agricultural Debtors Act was sent to the Court. In my view, however, that does not make any difference.

    Case No. 73 of 1936 was in respect of the balance of the debt that remained owing after the auction-sale. That balance was still owing and Case No. 73 of 1936 is in respect of that debt. In my view, the learned Munsif was right and acted in accordance with the provisions of s. 34 of the Bengal Agricultural Debtors Act when he stayed those proceedings in Case No. 73 of 1936 upon receipt of that notice.

    As regards Case No. 42 of 1933, the matter is different. Here the debt was satisfied and the proceedings were not in respect of a debt,—that is in a suit, or in satisfaction of a debt—that is in the ordinary execution proceedings. The proceedings at the date of the receipt of the notice under s. 34 were in respect of possession and were not founded upon a debt such as is necessary, in my view, to enable s. 34 to take effect. That debt had previously been satisfied.

    In my view, therefore, the learned. Munsif, in declining to stay the proceedings in Case No. 42 of 1933 and in ordering a stay in Case No. 73 of 1936, acted in accordance with the provisions of s. 34 of the Bengal Agricultural Debtors Act. For these reasons? I am of the opinion that this Rule must be discharged with costs, hearing fee two gold mohurs.

    Mukherjea, J.:— I agree with my Lord the Chief Justice in the decision and the reasoning and I would like to add only a few words.

    The facts of the case are not disputed and the whole controversy centres round the short point as to whether a proceeding for delivery of possession started by an auction-purchaser is really a proceeding in respect of a debt that was wiped off by the auction-sale. In my opinion, the answer to the question must be in the negative. The condition precedent for giving the Board a jurisdiction to issue a notice under s. 34 of the Bengal Agricultural Debtors Act, 1935, is the inclusion of a debt in the petition under ss. 8 and 13 of the Act in respect of which a suit or proceeding is pending either in the civil or in the revenue Court. In the case before us the sale took place in 1935 which wiped off a major portion of the debt. The decree-holders obtained a set-off for this amount and the sale was duly confirmed after a suit to set aside the sale commenced by the judgment-debtor had been dismissed. The auction-purchasers' title had been absolute at the time when the Act was passed and this portion of their debt had no existence when the application under ss. 8 and 13 of the Bengal Agricultural Debtors Act was made. The proceedings so far as it was in connection with Execution Case No. 42 of 1933, that was still pending, was only for delivery of possession to the decree-holders auction-purchasers; and although that may be a proceeding in execution within the meaning of s. 47 of the Code of Civil Procedure as held in the Full Bench case of Kailash Chandra Tarapdar v. Gopal Chandra Poddar(1), it was certainly not a proceeding in respect of or to recover a portion of the debt which alone would bring the case within s. 34, Agricultural Debtors Act. This section contains a provision which is ancillary to the settlement of the debt which is the main object of the Act and for which an application has got to be made under s. 8. If the debt was already satisfied by the auction-sale which took place prior to the passing of the Act, the Board obviously would have no jurisdiction to revive that debt by setting aside the execution sale and no question of settling a debt can arise when the debt itself has got no existence. The result of the proceeding for delivery of possession would not affect that portion of the debt in any way. That the legislature did not contemplate a proceeding like the one to come within s. 34, Agricultural Debtors Act, is apparent from the concluding lines of the section which lay down that—

    If the Board decides that the debt does not exist the suit or proceeding shall abate so far as it relates to such debt.

    In my opinion, this makes it clear that the suit or proceeding must be one for recovery of a debt, for otherwise there will be no sense in saying that these proceedings would cease when the Board would make an award negativing the existence of the debt itself. For these reasons, I am of the opinion that the view taken by the Court below is right and that the Rule must be discharged.

    Rule discharged.
    S.M

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    Comments

    Jaga Bandhu Shaha v. Rash Mani Dasee
    (May 10, 1937)