LexBALKISHANDAS & 12 OTHERS versus STATE BANK OF HYDERABAD AND ANR.
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BALKISllANDAS & 1.Z OTHERS
v.
STATE BANK OF HYDERAUAD AND ANR.
JalfUary 20, 1972
[K. S. HEGDE, P. JAGANMOHAN RBDDY AND D. 0. PALBKAR, JJ.]
Hyderabad Jaglrdars Debt Settlement Act, 1952-S. 11 and 25-IU
scope-Mortgage executed In favour of Bank-Whethtr extinguished by
virtue of S. 11 and 25 of the Act,
Respondent I, a bank, filed a suit against appellants Nos. 1 to 4, mem·
hers of a joint family, for the recovery cif Rs. 5 lakbs on the basis of a
mortgage deed executed in favour of the bank, by securing certain im·
movable properties without possession.
Defendant No.
5 became a
guarantor for the amount borrowed and executed a separate guarantee in
favour of the Bank. The appellants, who were Iagirdars, had money
transactions with the bank prior to the execution of the mortgage on three
separate accounts. The accounts we·re however, closed by /'ayment from
the amount of Rs. 5 lakhs advanced to them on the basis o the Mortgage
deed .. As the defendants failed to pay the amounts which fell due under
the terms of the mortgage, a suit was filed against all the ddfendants. The
firm and the 5th defendant remained ex-parte, but defendants Nos. 2-4
defended the suit. The trial court, decre~d the suit against the appell"'!ts
and the High Court also confirmed the Judgment and decree of the. trial
court. In· an appeal by certificate, two main points were urged:-(!) that
the suit debts were extinguished under S. 22 of the Hyderabad Jagirdars
Debt Settlement Act 1952, inasmuch as no application was presented by
the Bank u/s. 11 of the Act before the 30th June, 1953 which was the
notified date and (2) the civil court had no jurisdiction to lry the suit be·
cause u/s 25 of the Act, all suits and proceedings for the recovery of a
debt from a Jagirdar had to be transferred to the Jagirdars Debt Settlement
Board, which alone bad jurisdiction to oettlo it. It was contended on be-
half of the appellants that the mortgage executed by the appellants did not
create any new debt but merely secured the payment of pnor debts which
was the balance due to the Bank on the 3 accounts as on the date of the
mortgage which debts were pending debts within the meaning of S. 25(1).
Dimiisaina the appeal,
HELD : (i) From the terms of the mortgage deed, it was clear that
the debt of lb. 5 lalcb1 was a freth debt created by and secured thereunder
with intereot that may become due from the date of the mortgage and that
there was no 'lu .. tlon of the mortgage deed having been executed as a
aettlement of pnor debts so as to attract the provisions of Sections 11 and
25 of the Act. [163 Al
(ii) The eipression 'pending' in Section 25 related to proceedinp
which were pending on the notified date and.could not mean any pl-oceed-
ings which were instit)lted after such date. In the facts and circumstances
of the case the: del>.t created by !00 mortgaae deed is a fresh debt ·and
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therefore, the ~1oviaions of s. II and 2S are not attracted. [161 El
Joint ftzmi/Y .o(Mukund Doss v. Stat• Bank of Hyd1rabad, {1971) 2
S.C.R. 136, followed.
. 158
SUPREME COURT REPORTS
(1972] 3 S.C.R •
·
(iii) Once the proviliom of S. 11 and 25 wore shown to be not appli-
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.. cable, the civil court had jurisdiction to try the suit and the decree granted
by the Trial Court and confirmed by the Appellate Gour! did not suffer
from. any infirmity. [163 HJ
Slllle of JltJjasthan v. Mukund Chand, t1964] 6 S.C.R. 903, and Stale
Bank of Hydmzbad v. Mukunda Rafa Bhagwandaa & Ors., 1963
(II)
Aildhra Weekly Reporter 14, referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 547 of
1967.
Appeal from the judgment and decree dated November 14,
1966 of the Andhra Pradesh High Court in Original Side Appeal
No. 9 of 1959.
A. R. Somnath Iyer, R. K. P. Shankardass, R. V. Ramarao and
P. K. Pillai, for the appellants.
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S. V. Gupte, A. V. Rangam and A. Subhashini, for respondent
·No. 1.
The Judgment of the Court was delivered by
P. Jaganmoban Reddy, J. This
appeal is by certifi-
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cate against the judgment of the Andhra Pradesh High Court
which confirmed the judgment and decree of a single Judge of the
Original _Side of that Court. The first respondent Blink filed a
suit against the appellants-defendants Nos. 1-4 who are members
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of the joint family finn, for tlie recovery o( a sum of I.G.
Rs. 5,00,000/- on the basis of a mortgage deed executed by them
in favour or the Bank by securing cerExcerpt shown. Read the full judgment & AI analysis in Lexace.