Govardhan, J.@mdashDefendants are the appellants.
2. The averments in the plaint are briefly as follows: The defendants 1 and 2 and their father Chakrapani Chettiar mortgaged the suit property
belonging to them in favour of the plaintiff on 5.11.1972 and borrowed Rs. 20,000 towards their family expenses, agreeing to repay the same with
interest at 18% per annum and at 21 % if there is any default. The father of defendants 1 and 2 died in 1979. Defendants 1 and 2 are his heirs.
They have not paid any amount towards the principal or interest. Defendants are aware of the suit mortgage deed due to the plaintiff even during
the proceedings, in O.S. No. 283 of 1975 filed by the brother of the plaintiff. Chakrapani Chettiar was an assessee of income tax. Therefore he is
not entitled to the benefits of the Debt Relief Acts. Defendants are assessed to sales tax. Therefore, the plaintiff claims interest at 18% per annum
towards the amount due under the mortgage.
3. The second defendant in his written statement contends as follows: Deceased Chakrapani Chettiar paid interest towards the suit mortgage at the
rate of Rs. 300 per month on various dates. The plaintiff wants to suppress the payment and make an illegal gain on account of the death of
Chakrapani Chettiar in 1978. The deceased as well as the defendants are agriculturists entitled to the benefits of the Debt Relief Acts. The plaintiff
is not entitled to claim interest exceeding 9% per annum. Payment of Rs. 3,600 towards interest has to be reopened and appropriated at 9% per
annum. The plaintiff was the fourth defendant in the suit filed by his brother Venkatesan. The present suit is therefore barred by constructive res
judicata. It is liable to be dismissed.
4. On the above pleadings, the learned Principal Sub Judge, Salem, has held that the payments towards interest claimed by the defendants in their
written statement is true, that the suit is not barred by constructive res judicata that the defendants are not entitled to the benefits of the Debt Relief
Acts and granted a preliminary decree in favour of the plaintiff for Rs. 20,000 with interest thereon at 18% per annum for the period from
5.11.1972 to 21.7.1975 and from 16.1.1976 to date of decree less Rs. 3,600 and thereafter at 6% per annum till date of realisation.
5. Aggrieved over the same, the defendants have come forward with this appeal.
6. The defendants in their grounds of appeal have contended that the lower court has erred in observing that the plaintiff was not a party in O.S.
No. 283 of 1975 and it went wrong in holding that the appellants are not entitled to the benefits of Act IV of 1938 and that it has failed to consider
that the assessment of property tax or profession tax is not enough to refuse or deny the benefits of Act IV of 1938 in view of Section 13-A of the
Act. During the course of argument the learned Counsel appearing for the appellants has stated that he is not pressing the ground that the suit is
barred by the principles of constructive res judicata. Therefore, that is not considered in this appeal.
7. The trial Court has accepted the case of the defendants that Chakrapani Chettiar was making payment towards interest and it has also granted
the relief in favour of the defendants deducting a sum of Rs. 3,600 paid by Chakrapani Chettiar to the plaintiff. It is not in dispute that the
defendants 1 and 2 and their father Chakrapani Chettiar were held as agriculturists entitled to the benefits of Act IV of 1938. The trial court has
negatived the claim of the defendants that they are entitled to the benefits of Act IV of 193 8 on account of the proviso (c) to Section 3 of the Act.
The learned Counsel appearing for the appellants would argue that it is only on this question the defendants are aggrieved and have come forward
with this appeal and it is necessary to hold that the defendants are entitled to benefits of Act IV of 1938 and the interest is also calculated only at
9% per annum as per Section 13-A of the Act. Section 13-A of the Madras Agricultural Relief Act, which was introduced into the Act by the
Amending Act XXIII of 1948 provides for a ceiling rate of interest incurred to a debt payable by a certain category of non-agricultural debtors.
8. Section 13-A of the abovesaid Act is as follows:
Where a debt is incurred by a person who would be an agriculturist as defined in Section 3(ii), but for the operation of Proviso (B) or Proviso (C)
to that section the rate of interest applicable to the debt shall be the rate applicable to it under the law, custom, contract or decree of court under
which the debt arises or the rate applicable to an agriculturist u/s 13, whichever rate is less.
The effect of Section 13-A is to give the benefit Of the reduced rate of interest to debtors who have an interest in agricultural lands as defined u/s
3( ii) but who could not avail themselves of the benefit either because they pay profession or property tax over a specified amount to a local
authority. The trial court has held that the defendants are not entitled to the benefits of Agricultural Relief Act with an observation that even in
1970-72, they ought to have been assessed to property since then and that therefore, in view of the Section 3, Proviso (C) of the Act, the
defendants cannot be defined as agriculturists. Section 13-A as already observed by me gives the benefits of the reduced rate of interest to the
debtors who could not avail themselves of the benefit on account of the payment of profession tax or property tax. This has not been considered
by the trial court, The learned Counsel appearing for the respondent would argue that the benefits of Section 13-A cannot be availed by the
defendants since the sale deed under Ex.B-31 in favour of Chakrapani Chettiar is dated 28.4.1981 and the mortgage has been executed by
Chakrapani Chettiar and his two sons on 5.11.1972 long before Chakrapani Chettiar acquires property by virtue of which he can be termed as
agriculturist. In other words, according to the learned Counsel appearing for the respondent, Chakrapani Chettiar was not an agriculturist when he
incurred the debt on 5.11.1972 and therefore, the defendants are not entitled to the benefits of Section 13-A of the Madras Agriculturists Relief
Act. Section 13-A does not provide that the debtor should be an agriculturist when he availed the debt. A reading of the same would show that
even for non-agriculturist debtors, the section will apply. Section 13-A imposes a new restriction on the frame of contract in favour of debtors who
are not agriculturists, and there being no indication in the section that it should cover contracts entered into prior to the coming into force of the
section, it has to be read as applying only to a transaction coming into existence after the Act. Therefore, the argument of the learned Counsel
appearing for the respondent that on the date of incurring the debt by executing the mortgage under Ex. A-1 Chakrapani Chettiar was not an
agriculturist and therefore, the provisions of Section 13-A are not available to the defendants, is without merits. Therefore, I am of opinion that the
judgment of the learned Sub Judge, Salem has to be modified as follows: The judgment and the preliminary decree of the Subordinate Judge,
Salem is modified in such a way that the plaintiff is entitled to interest only at 9% per annum and not at 18% as granted by the trial court.
9. In the result, the appeal is allowed in part and the judgment and decree of the trial court is modified by granting a preliminary in favour of the
plaintiff for recovery of Rs,20,000 with interest thereon at 9% per annum from 5.11.1972 to 21.7.1975 and from 16.1.1976 to the date of decree,
less Rs. 3,600 and thereafter at 6% per annum till date of realisation with proportionate costs. Time for payment two months.
