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Pt. Shiva Shankar Lal Sharma vs Ramji Lal

High Court Of Judicature at Allahabad|12 February, 1941


1. This appeal raises a little point which may possibly be one of some practical interest. The facts are that in September 1922, the defendant lent a sum of Rs. 10,000 to the plaintiff at interest at a certain rate. In 1934, the United Provinces Agriculturists' Relief Act was passed. Among other provisions, the Act by Section 33 gave to an agriculturist debtor a right to come to the Court and obtain from the Court a declaration, as between himself and his creditor, as to the outstanding amount of the debt. Upon such an application, the Court is enjoined, after taking the necessary accounts, to declare the amount of debt accordingly and, if the creditor so desires, to pass a decree in his favour for the sum so found. In October 1935 the debtor was minded to avail himself of Section 33 of the Act, and he started a suit under that section by a plaint of 2nd October 1935. He admitted that he had borrowed the money in 1922 and claimed to be an agriculturist. Then, by para. 3 of his plaint he claimed certain credits amounting in all to Bs. 5700 in respect of payments which he said he had from time to time made to the creditor. By para. I the plaintiff said that, though he had asked for accounts from his creditor, he had failed to obtain them and then he went to ask for a declaration that a sum of Rs. 17,755 was due to him. And in addition he asked for his costs of the proceedings. Beyond the statement of the credits claimed by the plaintiff contained in para. 3 of the plaint there was no exact statement showing how that figure of Rs. 17,765 was arrived at. But, obviously, what had happened was that the plaintiff had aggregated principal and interest and, after taking credit for what he claimed he had paid, had arrived at the final figure of Rs. 17,755. That plaint was filed over a ten-rupee stamp and, immediately on presentation, the appropriate officer of the Court made the observation upon it that the court-fee was insufficient. In response to that observation by the Munsarim, the learned Judge himself con-tributed a note at the foot of the plaint to this effect:
The matter is a difficult one and is best finally decided after hearing other side, so register and let summonses issue for hearing suit for 10th December 1935. The question of deficiency shall then be finally considered.
2. That referred to the question which at that stage had been raised by the Munsarim as to the sufficiency of the ten-rupee court, fee. Three months lajter on, 6th January 1936, the defendant, -who was the creditor, lodged his written statement. He admitted practically everything in the plaint, except that he had refused or neglected to render an account when asked for it. That was the allegation of para. & of the plaint but by his further pleas he raised two points. Ifirst, by para. 10, he raised the point as to the insufficiency of the court-fee which had already been taken by the Munsarim and which had been directed by the Judge to be decided in Court at the hearing and, secondly, by para. 9 he pointed out, as was perfectly true, that the plaintiff had not filed any actual account and that it was impossible to proceed with an adjustment of the account without details of it. He did not, however, deny the credits which the plaintiff claimed ; on the other hand, he expressly admitted them. All he said was, in effect, "let me see the account, and then I shall be able to say what is due."
3. On 8th January 1936, two days after the written statement had been filed, the learned Judge in fact made an order directing the plaintiff to file an account and on 8th January, the plaintiff did file an account in the form of an exhibit to an affidavit of that date. This account showed not only the payments alleged in para. 3 of the plaint for which he claimed credit but also showed the calculations of interest having regard to the dates of payment of those credits and it ultimately arrived at the figure of Rupees 17,755 which was the same figure as was stated in the plaint; in short, the account of 8th January 1936 was a full account. The case came before the learned Judge on 22nd January 1936, and he tells us himself what happened. It was that the defendant by his vakil admitted the correctness of the account. The learned Judge then went on to decide the small question as to the court, fee and ultimately after a very brief judgment, held that the plaintiff was entitled to a declaration that Rs. 17,755 was payable by the plaintiff to the defendant on 2nd October 1935 and that he was entitled to his costs of the suit. It is the order as to costs that has given rise to this appeal. The decree was drawn up on 8th February 1986 and it is noticeablealthough no complaint seems to have been made of it in this appeal that the decree goes a good deal further than the judgment, inasmuch as it not only makes a declaration but also gives a decree for payment. The judgment makes no order for payment, and, if Section 33 is Carefully examined, it will be seen that a decree for payment does not follow as a matter of course but only when it is expressly applied for by the defendant. In this case it is evident from the judgment itself that it had not been applied for. I only point that out for the benefit of the learned Judge. No complaint is made about it in this appeal. The appellant, who is the defendant, filed this appeal on 23rd April and as originally filed his memorandom of appeal asked to have the whole decree set aside. That, however, was amended in May and the only part of the decree that was attacked by the amended memorandum of appeal was the order as to costs. That, therefore, is what is now in dispute. The appellant says that he ought not to have been ordered to pay the plaintiff's costs. They actually amounted to the not insubstantial sum of Rs. 414.
4. It appears to me that I must consider this question from two points of view: first, whether on principle and apart from any special circumstances of any particular case, a debtor, who avails himself of Section 33, Agriculturists' Relief Act, ought normally to be given his costs at the expense of his creditor, and secondly whether in this particular case there are any special circumstances which might alter any general rule. Now the Agriculturists' Belief Act of 1934 is, as its title implies and as its preamble expressly states, an Act "for the relief of agriculturists." It is a beneficent measure designed to the advantage of agriculturists who find themselves embarrassed by debt. It is intended as a measure of which an agriculturist can take advantage if he is so minded. And Section 33 is a section which, as it seems to me, is designed to enable the agriculturist to find out, at any given time, how he stands. It is obviously much to the advantage of a peasant who is in debt that he should have the right to go to his creditor, who more often than not will be a money-lender, and to demand from him a strict account with a view not only to seeing that it is accurate but possibly to obtaining some relief on the ground of usury and for some other reason. This section, therefore, was, as it seems to me, a measure which was primarily designed to be of benefit to the debtor.
5. The debtor, therefore, who takes advantage of it is, in the first place, availing himself of a right which has been conferred upon him by the Legislature, which right has not necessarily been provoked by any wrong doing on the part of his creditor. The creditor cannot be blamed for having lent the debtor money, and it is not the creditor's fault that the United Provinces Legislature was inspired to pass this Act. It seems to me that a "suit" under Section 33 ought, properly regarded, to be considered primarily much more as a measure of administrative machinery than as a piece of contentious litigation. In its first stages, I think that that is what it really is. It was possibly a little unfortunate that the word "suit" was used at all. There is a flavour of a controversy about the word "suit." Possibly the word 'application' would have been better. However that may be, I do not think that, by whatever name one calls it, it constitutes in its origin the initiation of hostile litigation. Of course, it may become hostile, and indeed very bitter litigation, if the creditor disputes the debt or the amount of it. But that cannot be predicated of it until the creditor has disclosed the attitude he takes.
6. In the present case, the creditor took what must be conceded to have been a very reasonable and proper course. He said first that the plaintiff had not disclosed sufficient material for him to admit the account at once but, if the plaintiff would do so, he would then consider it. The plaintiff filed the account and immediately the creditor admitted that it was correct. I can imagine nothing more reasonable. There was certainly nothing in that to turn the proceedings from what they originally were into [hostile litigation. The conclusion at which I have arrivedspeaking generallyis that it was not the intention of the Legislature ;hat litigation under Section 33 of the Act should necessarily be regarded as contentious litigation. I think that proceedings under that section ought primarily to be regarded as proceedings more of an administrative character than as proceedings designed to settle quarrels between the parties. Therefore, it would appear to me to be plain that, in the exercise of its very wide discretion as to costs a discretion conferred by Section 35, Civil P.C. - the Court in the special circumstances of such applications as this ought not to follow slavishly its well-known principle which applies in contentious cases that costs prima facie follow the event. In a case where there are no special circumstances making it equitable that the creditor should bear the costs, it would appear to me that it would be unjust that the debtor should be permitted, by availing himself of the provisions of the Agriculturists' Belief Act which are designed primarily for his own benefit, to throw an additional burden on to his creditor which that creditor has not deserved through any misconduct or impropriety. That, I think, should be the guiding principle. But, of course, every case must be considered upon its own facts and circumstances and I can well imagine that there might be many cases in which the creditor might have earned the right to be burdened with the costs or some of them. Thus, I have to see whether in this particular case the creditor has done anything to deserve being penalised with the costs or any part of them.
7. It is said that the creditor converted this into contentious or hostile litigation first by pleading that the plaintiff ought to have filed better account and secondly by pleading the inadequacy of the court-fee. I do not agree with either of these contentions. As I have already said, I do not regard it as unreasonable that the defendant should have said that he would like to see a better account before he finally admitted the exact amount that was due. When he did see the account, he at once admitted that it was right. This did not make the litigation contentious litigation, because it is the very thing that the statute contemplates. Under the section itself the Court has to take the necessary account, and that is exactly what happened in this case. Then as regards the court fee, it is quite true that the defendant did formally take the point in para. 10 of his written statement. But he only took it three months after the Judge himself had taken it and ordered that it should be dealt, with at the hearing. It was a mere echo of what the Judge had said. Nor do I think that a point as to the court-fee would normally turn litigation into hostile litigation when it would not otherwise have been hostile. Bules 22 and 23 of Chap. 21 of the General Bules, civil, of this Court draw a distinction between contested and uncon-tested litigation and make it depend upon whether there has been a decision "on the merits after contest." A decision as to whether a court-fee should be Bs. 10 or not is not, I think, a decision "on the merits" al. though it may give rise to some measure of contest. Nor do I think, in this particular case, that the costs were increased by one anna by this question of the court-fee.
8. In my judgment, accordingly there are no special reasons in this case why I should depart from the ordinary rule as I conceive that rule ought to be. As already explained the ordinary rule should, I think, be that a debtor, by taking advantage of Section 33, Agriculturists' Belief Act, ought not to be allowed to throw upon his creditor an additional burden. He is doing something for his own benefit and the only fair thing, as it seems to me, is that he should bear his own costs of doing so. In the result therefore this appeal must be allowed and the decree must !be altered so as to provide that each party shall bear his own costs. I only desire to point out that I am not altogether sure that taxation of the costs upon the contested scale was right. I do not want to express a concluded view, but actually I think, it might have been contended with great force that in the course that events took, there was no decision 'on the merits after contest.' I shall accordingly allow this appeal to the extent of varying the decree as I have already indicated. I think the appellant is entitled to his costs of this appeal as he has had to come to this Court to get the matter corrected.
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Pt. Shiva Shankar Lal Sharma vs Ramji Lal


High Court Of Judicature at Allahabad

12 February, 1941