Shankar Prahlad Deshpande & Ors. v. Seth Gendalal Motilal Patni & Ors.

**A** B ## c **D** **E** **F** **G** **H** 177 **SHANKAR** **PRAHLAD** **DESHPANDE** **&** **ORS.** _v._ **SETH GENDALAL MOTILAL PATNI** **&** **ORS.** _October_ 29, 1969 {J.C. SHAH AND K. S. HEGDE, JJ.] _Madhya Pradesh Abolition_ _of_ _Proprietary Rights (Estates, Mahdfs and_ _Alienated Lands)_ _Act_ I _of_ 1951, _ss._ 22, _13-Discharge_ _of_ _debt for non-_ _**submission**_ _**of statement**_ _**of**_ _**claim-Fresh**_ _**order under s.**_ **22** _**by claims**_ _**offi.**_ _**cer**_ _**necessary where previous order**_ _**to**_ _**submit claim annulled**_ _**by**_ _**Baard**_ _**of**_ _**Revenue.**_ A mortgagor applied to the Claim' Officer under s. 19 of the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals and Alienated Lands) Act I of 1951 for determination of the debt due to the mortgagee and for scaling down the debt. The mortgagee contended that the debt, **by adjudication of court,** **had** **been merged into a decree** **and** **there was no** secured debt which could be determined or scaled down. The Claims **Officer held that there was a debt due to the mortgagee, that** **it** **was a secur.** ed debt and that he had jurisdiction for "determining the debt" and direct**ed** **the** **mortgagee to submit a statement of the claim under s. 22** _**df**_ **the** Act. On appeal by the mortgagee, the Board of Revenue, following the **judgment** **of** **the High Court** **in** _**Ramkishan**_ **v.** _**Board**_ _**of**_ _**Revenue,**_ _**Madhya**_ _**Pradesh,**_ **I.L.R. [1954] Nag. 430, held** **that** **the Claim Officer** **had** **no juris-** **diction to decide whether** **the** **debt** **was** **a secured debt. Upon the High Court** **overruling** _**Ramkrishna's**_ **case** **in** J~thalal _**Bhawanji**_ **v.** _**Prabhakar**_ _**Sadosiv**_ I.LR. [1956] Nag. 147, the mortgagee field a statement of his claim before **the Claims** **Offic-.::r.** **The mortgagor contended that the debt stood discharged** under s. 22 of the Act as the mortgagee had failed to file a statement _di_ **his claim** **as** **originally directed by** **the** **Claims Officer. The Claims Officer** **upheld the contention.** **The. Commiss!oner** **in** **appeal** **set** **aside** **the** **order** **of** **the** **Oaims Officer discharging** **the** **debt** **and** **a petition** **in** **the High Court** **against the Commissioner's order** **was** **summarily dismissed.** D~smissing the appeal to this Court, **HELD : Section 22 enacts a penal p:-ovision** **and** **unless the conditions** precedent are satisfied, the debt could not by operation of the statute be discharged. In the present case the order of the Claims Officer was reversed by the Board of Revenue, and all directions given by the Claims Officer, pursuant **to his order calling upon the mortgagee to file a statement** **of** **his** **c1aim,** stood annulled. Thereafter the Claims Officer did not pas.s any order under s. 22 of the Act 1 df 1951 directing that the proceeding shall con**tinue- and** **further directing that a notice shall issue calling upon the mort-** **gagee to file a statement of the claim. Until a notice, valid in law, dire:tlng** that a statement be filed was •erved upon the mortgagee and he failed t<> comply with it, the debt could not be discharged, [179 G-180 BJ CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2373 of 1966, Appeal from the judgment and order dated September. 1964 of the Bombay High Court Nagpur Bench in Special Civil Appli cation No. 471 of 1964. 178 SUPREME COURT REPORTS [1970] 3 S.C.R. C. _B. Agarwala,_ _G._ _L. Sanghi,_ _P._ _N. Kukde_ and _A.G. Ratna-_ _parkhi,_ for the appellants Nos. 1, 2 and 4 to 6. _R. M. Hawrnavis_ a:nd _A.G. Ratnaparkhi,_ for appellant No. 3. _S. T._ _Desai,_ _M._ _S._ _Gupta_ and _S._ _K. Dhingra,_ for respondent No. 1. _N._ _S._ _Bindra_ and _S._ _P._ _Nayar,_ for respondents Nos. 2 and 3. The Judgment of the Court was delivered by **Shah,** **J** .-Gendalal-hereinafter called 'the mortgage' -filed Suit No. 11 of 1939 for recovery of the amount due under a deed of mortgage of proprietary rights in certain villages executed in 1929 by Prahlad-father of the appellant. A preliminary mortgage decree was passed declaring that Rs. 2,16,309/ 11/9 were due on the mortgage. The decree was made absolute for sale. The mortgage commenced in 1948 proceediilgs for execut ing the decree. On .March 31, 1951, the Madhya Pradesh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act 1 of 1951 was brought into force. By virtue of s. 3 of that Act the proprietary rights of holders of estates, mahals, alienated villages and alienated lands stood vested in the State. Chapter IV of the Act provided for "determination of debts". The mortgagor Prahlad applied on April 26, 1951 to the Claims Officer under s. 19 of that Act for "determination of the debt" due to the mortgagee and for scaling down the debt. The mortgagee contended that the debt had, by adjudication of the .Court, been merged into a decree and there was no "secured ~bt" which could be determined or scaled down. The Claims Officer held that there was a debt due to the mortgagee, that it was a secured debt, and that he had jurisdiction to "determine the debt". On November 19, 1951 the Claims Officer directed the mortgagee to submit a statement of the claim under s. 22 of the Act. Against the order of the Claims Officer, the mortgagee appealed to the Board of Revenue. Following the judgment of the Nagpur High Court in _Ramklshan_ v. _Board of Revenue,_ _Madhya_ _Pradesh_ (1), the Board of Revenue set aside the order holding that the Claims Officer had no jurisdiction to decide the question whether there was a secured debt, and that the Civil Court alone was competent to decide that question. In the execution application filed by the mortgagee the Additional District Judge held that th.ere was a secured debt within the meaning of s. 19 read with s. 17 ( 1 ) of the Act due to the mortgagee under the mortgage, notwithstanding the decree passed by the Civil Court. (I) l.L.R [195'] N'.~. 430. **A** **B** ## **c** **D** **E** **F** **G** **H** A B ## c D S. P. DESHPANDE _v._ GENDALAL _(Shah,_ /.) 179 On October 3, 1955, the High Court of Nagpur in _Jethalal_ _Bhawanji_ v. _Prabhakar Sadashiv(')_ overruled the Judgment in _Ramkrishna's_ case( [2] ), and held that the Claims Officer had juris diction to decide whether a ·debt was a secured debt. The mortgagee then filed on January 23, 1958, a statement of his claim. Oil March 26, 1958, the appellant-son of the original mortgagor Prahla~ontended that the debt stood discharged because the mortgagee had failed to file a statement of his claim as ordered on November 19, 1951 by the Claims Officer. By order dated Decembe; 24, 1962 the Claims Officer· upheld the contention of ·the appellant. Against that order the mortgagee preferred an appeal to the Commissioner, Nagpur Division. At the hearing of the appeal, the appellant contended that the Commissioner had no jurisdiction to hear the appeal. The Commissioner rejected the contention of the appellant and set aside the order of the Claims Officer discharging the debt. A petition moved by the appellant in the High Court of Bombay at Nagpur challenging the order passed by the Commissioner was summarily dismissed. Witli certificate granted by the High Court, this appeal has been preferred. Counsel contended that the mortgagee failed to file a statement of account pursuant to the order dated November 19, 1951 by the Claims Officer, and by virtue of s. 22 of the Madhya PraE desh Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Act I of 1951 the debt stood discharged. But the order. # of the Claims Officer holding that there was a secured debt was set aside in appeal by the Board of Revenue. Any proceeding consequent upon that adjudication was, in view of the judgment of the Board of Revenue, unauthorised. That decision of the F Board of Revenue became final between the parties. It cannot be contended that because in another proceeding the High Court of Nagp'!r expressed the view that the judgment on which the Board of Revenue relied was erroneous, the direction of the Claims Officer requiring the mortgagee to file his statement of account was revived, and if the directions of the Claims Officer G wer.! not complied with, the debt due to the mortgagee was discharged. The order of the Claims Officer was reversed by the Board of Revenue, and all directions given by the Claims Officer, pursuant to his order calling upori the mortgagee to file a statement of his claim, stood annulled. The Nagpur High Court in _Jethalal Bhawanji's_ case('), it is true, decided that the Claims Officer was competent under s. 23 of M.P. Act 1 of 1951 to H determine whether a debt is a secured debt. But the first order of the Claims Officer was annulled by order of the Board of (I) I.LR. [t9S6J Nag .. 147. _(2)_ 1.L.R. [1954) Nag. 480 .• 180 SUPREME COURT REPORTS [ 1970] 3 S.C.R. Revenue .. and thereafter that Officer did not pass any order under s. 22 of Act 1 of 1951 directing that the pr~g shall continue, and further directing that a notice shall issue calling upon the mortgagee to file a st!!_temeht of the claim. Until a notice, valid in Jaw, directing that a statement be filed was served upon the mortgagee and he failed to comply with it, the debt could not be discharged. Section 22 enacts a penal provision and unless the conditions precedent are satisfied, the debt could not by operation of the statute be discharged). The High Court was right in dismissing the petition. The appeal fails and is dismissed with costs. Y.P. _Appeal_ _dismir.sed._ A B ## c