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PETITIONER:

BANK OF INDIA

Vs.

RESPONDENT:

VIJAY TRANSPORT AND OTHERS

DATE OF JUDGMENT11/11/1987

BENCH:

DUTT, M.M. (J)

BENCH:

DUTT, M.M. (J)

KANIA, M.H.

CITATION:

1988 AIR 151 1988 SCR (1) 961

1988 SCC Supl. 47 JT 1987 (4) 389

1987 SCALE (2)1028

CITATOR INFO :

F 1989 SC2105 (3,4)

ACT:

Andhra Pradesh (Andhra Area) Agriculturists Relief Act,

1938: Sec. 4(e)-`Debt'-Due to Bank-Scaling down of debt-

Whether permissible.

Banking Companies Act: Validity of-Act whether a

special Indian law.

Statutory Interpretation: Duty of court-To look at the

setting in which words are used and circumstances in which

the law came to be passed.

HEADNOTE:

%

The appellant-Bank filed a suit against respondents

including respondent firm and its partners, who were

agriculturists, for recovery of a sum of Rs.18,14,817.91

being balance of three principal amounts severally advanced

by the Bank to the firm under cash-credit account on three

different dates. The last loan was advanced by the Bank

after its nationalisation on July 7, 1969. The Bank alleged

that, to secure repayment of the aforesaid amount of loan,

in addition to hypothecation made in its favour of the

properties in `A' and`B'Schedules of the plaint, equitable

mortgage of properties in Schedule `C', `D' and `E' was also

created in its favour by respondent No. 2, respondent No. 3

and his deceased father. The appellant-Bank prayed for the

sale of the said properties for the recovery of the amounts

claimed by it.

The respondents, including the firm, and Respondents

No.4 to 12, who were alienees, denied creation of any

equitable mortgage in favour of the appellant-Bank. The

respondent firm and its partners, namely, third respondent's

deceased father and the second respondent also filed counter

claim against the appellant-Bank.

Dismissing the suit against respondent Nos. 4-12, the

Subordinate Judge held that no equitable mortgage was

created in favour of the appellant-Bank and that the claim

of the appellant-Bank, except to the extent of

Rs.1,00,418.55, was barred by limitation. The counter claim

against the Bank was decreed.

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962

Setting aside the Judgment and decrees of the

Subordinate Judge, the High Court, in appeal, decreed the

suit instituted by the appellant, but held that the Bank was

entitled to recover the amount claimed by it, only after

scaling down the debt in accordance with the provisions of

the Andhra Pradesh (Andhra Area) Agriculturists Relief Act

IV of 1938.

In the appeal by special leave, it was submitted on

behalf of the appellant-Bank that in view of s. 4(e) of the

Act, the provisions of the Act were not applicable to the

appellant-Bank and as such, it was entitled to recover the

entire amount without the same being scaled down as provided

in s. 13 of the Act, and that the words "special Indian Law"

in s. 4(e) referred to and related to law made by an Indian

Legislature.

On behalf of the respondents, it was contended that the

words "special Indian law" meant a special Indian Law

enacted by the Parliament of the United Kingdom, that even

assuming that the expression "special Indian law" meant a

law enacted by the Indian Legislature and that the Banking

Act was such a law, still the provision of s. 4(e) of the

Act did not apply inasmuch as the appellant-Bank was not

formed in pursuance of "special Indian law", but by or under

"special Indian law", that is, the Banking Companies Act,

and as such, it was not a Corporation within the meaning of

s. 4(e) of the Act, that as the appellant-Bank was

nationalised and/or created under Ordinance VIII of 1969

promulgated on July 19, 1969 and the Banking Companies Act

only ratified the already created bank under the said

Ordinance, it was not formed or created under any `special

Indian Law' and that since a major part of the loan was

contracted before the nationalisation of the appellant Bank,

the provision of s. 4(e) was not applicable.

Allowing the appeal,

^

HELD: 1. The provisions of the Act are not applicable

to the appellant Bank, and there is no question of scaling

down the debt due to the Bank by the respondents. [972E]

In the instant case, the amounts of loan were advanced

by the Bank to the firm under the cash-credit account opened

in favour of the firm. Normally, the advances that are made

from the cash-credit account are repaid and thereafter fresh

advances are made. It is not known what was the actual

balance on the date the Bank was nationalised, and whether

the first two amounts were repaid by the firm and,

thereafter fresh advances were taken on the cash credit

account. [971B-D]

963

2.4 The Banking Companies Act is a special Indian law

and the provision of s. 4(e) Andhra Pradesh (Andhra Area)

Act IV of 1938 is applicable to the appellant Bank.[969G]

2.2 In interpreting the words of the provision of a

statute, while it may sometimes be necessary to take into

consideration the setting in which such words are placed,

that is not the only and the surest method of

interpretation, and when such words convey a clear meaning,

a different interpretation or meaning need not be given to

them because of the setting. [968D]

R.L. Arora v. State of Uttar Pradesh, [1964] 6 SCR 784,

referred to.

In the instant case the expression `special Indian law'

has a clear and unambiguous meaning. There is no reasonable

justification to think that the expression must be an

enactment of the British Parliament since there were in

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existence Indian Legislatures, including a Legislatures at

the Centre. [968E]

Section 3(27)(a) of the General Clauses Act, as it

stood on the day the Act was passed, defines `Indian Law' as

meaning any Indian law enacted by the Indian Legislature.

The expression `special Indian law' therefore, means a

special Indian law enacted by the Indian Legislature. [968F-

G]

Indian Bank, Alamuru v. Krishna Murthy, AIR 1983 Andhra

Pradesh 347,over-ruled.

2.3 Inasmuch as the words `any special Indian law' in

s. 4(e) of the Act refer and relate to a law made by the

Indian Legislature and not by the British Parliament, the

Banking Companies Act is quite legal and valid. [972C-D]

2.4 Theoretically, there may be a distinction between

the words `in pursuance of' and the words `by or under' but

by using the expression `in pursuance of' in s. 4(e), the

Legislature has not meant that the corporation, in question,

should be formed by a third party in pursuance of the law

and not by the law itself in order to come within the

purview of s. 4(e) of the Act. The intention of the

Legislature is very clear in that the provision of s. 4(e)

would apply to a corporation which is the creature of a

special Indian law, whether it is created in pursuance of or

by or under the special Indian law. There is no difference

964

Or distinction whatsoever between the corporation

formed in pursuance of,and a corporation by or under a

special Indian law. [969E-F]

2.5 An Ordinance is as much a law as an enactment of

Parliament or Legislature. Therefore, it must be held that

the bank was created under a special Indian law even

assuming that the bank was created under the Ordinance VIII

of 1969 and not under the Banking Companies Act. It is also

manifestly clear from sub-section (1) of section 3 of the

Banking Companies Act which provides that on the

commencement of the Banking Companies Act there shall be

constituted such corresponding new Banks as are specified in

the first Schedule, that the appellantBank, which is

mentioned in the first Schedule, has been created under the

provisions of the Banking Companies Act with effect from

July 19, 1969.[970C,E-F]

R.C. Cooper v. Union of India, AIR 1970 SC 564 and Life

Insurance Corporation of India v. Kota Ramabrahmam, AIR 1977

SC 1704, referred to.

JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 465 of

1985.

From the Judgment and Order dated 20.9.1983 of the

Andhra Pradesh High Court in Appeal No. 858 of 1976.

G. Ramaswamy, Additional Solicitor-General and P.

H.Parekh for the Appellant.

T.V.S.N. Chari, Ms. Vrinda Grover, Charanjeet, V.D.

Miracee and B.P. Maheshwari for the Respondents.

The Judgment of the Court was delivered by

DUTT, J. This appeal by special leave is at the

instance of the appellant, the Bank of India, a nationalised

Bank, and is directed against the judgment and decree of the

Andhra Pradesh High Court in so far as they direct that the

appellant is entitled to recover the amounts claimed by it

against the respondent firm only after the scaling down of

the debt in accordance with the provisions of the Madras

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Agriculturists Relief Act IV of 1938 which, after the

creation of the State of Andhra Pradesh, was made applicable

to that State as the Andhra Pradesh (Andhra Area)

Agriculturists Relief Act IV of 1938, hereinafter referred

to as `the Act'.

965

The appellant Bank filed a suit being O.S. No. 12 of

1979 in the Sub-Court, Eluru, on February 10, 1975 against

the respondents including the respondent firm and its

partners to recover a sum of Rs.18,14,817.91 being the

balance (inclusive of interest) of three principal amounts

of Rs.3.00,000, Rs.7,00,000 and Rs.80,000 severally advanced

by the Bank to the firm under cash credit account on 28-11-

1967, 3-4-1968 and 17-2-1972 respectively. It may be noticed

here that the Bank was nationalised on July 7, 1969 under

the Banking Companies (Acquisition and Transfer of

Undertakings) Act V of 1970, hereinafter referred to as `the

Banking Companies Act'. The sum of Rs.80,000 was admittedly

advanced by way of loan by the Bank after its

nationalisation.

The respondent firm owns certain motor vehicles which

are mentioned in A and Schedules to the plaint of the said

suit. The firm was carrying on its business at Madras as

fleet owners and gasolene carriers. It had two partners,

namely, one S. Doranna Choudhury, since deceased, the father

of the respondent No. 3 and the respondent No. 2, Sunkavali

Rajlaxmi. The case of the Bank was that in addition to the

hypothecation of the A and Schedule properties made in its

favour to secure the repayment of the aforesaid amounts of

loan, the other partner, the respondent No. 2, created an

equitable mortgage in favour of the Bank on December 22,

1969 in respect of C-Schedule properties of the plaint. S.

Doranna Choudhury, since deceased, also created an equitable

mortgage in favour of the Bank on February 28, 1970 in

respect of D-Schedule properties of the plaint. The

respondent No.3 also created another equitable mortgage on

September 6, 1974 in respect of E-Schedule properties of the

plaint. The respondents No. 4 to 12 are alienees of the

mortgaged properties. In the suit the Bank prayed for the

sale of the said properties for the recovery of the amounts

claimed by it on account of the loan together with interest

due thereon.

The respondents including the firm contested the suit

by filing written statements, inter alia, denying the

creation of any equitable mortgage by the deceased partner

and the respondents Nos. 2 & 3 in favour of the Bank. The

respondents Nos. 4 to 12, the alienees, while denying the

creation of the mortgages contended that they were bona fide

purchasers for valuable consideration and the Bank was bound

by the alienations and transfers made in their favour of the

properties alleged to be under mortgage. The firm and its

partners, namely, the said S. Doranna and the respondent No.

2 also filed a counter-claim against the Bank for a sum of

Rs.34,48,799. It is not necessary for us to

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state in details the respective cases of the parties

including the case of the firm and its partners in making

the counter claim against the Bank, inasmuch as the scope of

this appeal is limited to the consideration of the question

as to whether the High Court was justified in decreeing the

Bank's claim only after the scaling down of the debt in

accordance with the provisions of the Act.

Be that as it may, the learned Subordinate Judge held

that no equitable mortgage was created in favour of the Bank

and, accordingly, dismissed the suit against the respondents

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Nos. 4 to 12 and refused to direct sale of the properties

alleged to have been mortgaged to the Bank. The learned

Subordinate Judge also found that the claim of the Bank,

except to the extent of Rs.1,00,418.55, was barred by

limitation. The counter-claim of the firm and its partners

for the sum of Rs.34,48,799 was decreed and the Bank was

directed to pay the same to the firm and its partners.

Being dissatisfied with the judgment and decree of the

learned Subordinate Judge, the Bank preferred an appeal to

the High Court. The High Court, after elaborately

considering the facts and circumstances of the case and the

evidence adduced by the parties, set aside the judgment and

decree of the learned Subordinate Judge including the decree

allowing the counter-claim of the firm and its partners and

decreed the suit instituted by the Bank. In decreeing the

suit, the High Court held that the Bank was entitled to

recover the amount claimed by it only after the scaling down

of the debt in accordance with the provisions of the Act.

Hence this appeal.

The Act contains provisions granting reliefs to

indebted agriculturists. One of such reliefs is that as

contained in section 13 of the Act providing for the scaling

down of the debt of an agriculturist. It is not disputed

that the partners of the respondent firm are agriculturists.

Mr. G. Ramaswamy, learned Additional Solicitor General

appearing on behalf of the appellant Bank, submits that in

view of section 4(e) of the Act, the provisions of the Act

were not applicable to the Bank and, as such, the Bank was

entitled to recover the entire amount without the same being

scaled down as provided in section 13 of the Act. Before the

High Court also the Bank placed reliance on the provision of

section 4(e) of the Act, but the High Court negatived the

contention relying upon a Division Bench decision in Indian

Bank, Alamuru v. Krishna Murthy, AIR 1983 Andhra Pradesh

347. We shall presently refer to that decision, but before

we do that it is necessary to

967

refer to the provision of section 4(e) of the Act, which is

extracted below:-

"S.4. Nothing in this Act shall affect debts and

liabilities of an agriculturist falling under the

following heads:-

............................................

............................................

............................................

(e) any liability in respect of any sum due

to any cooperative society, including a

land mortgage bank, registered or deemed

to be registered under the Andhra

Pradesh (Andhra Area) Co-operative

Societies Act, 1932, or any debt due to

any corporation formed in pursuance of

an Act of Parliament of the United

Kingdom or of any special Indian law or

Royal Charter or Letters Patent."

In view of section 4(e), the provisions of the Act will

be inapplicable to any debt due to any corporation formed in

pursuance of an Act of Parliament of the United Kingdom or

any special Indian law or Royal Charter or Letters

Patent.The question is whether the Banking Companies Act by

or under which the appellant Bank was constituted, is a

`special Indian law' or not. It is submitted on behalf of

the Bank that the words `special Indian law' in section 4(e)

of the Act refers and relates to law made by an Indian

Legislature. It is not disputed that the Banking Companies

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Act is a special law enacted by the Indian Parliament.

It has, however, been urged by Mr. Mirasee, learned

Counsel appearing on behalf of the respondents, that the

said words mean a special Indian law enacted by the

Parliament of the United Kingdom. Indeed, in Krishna

Murthy's case (supra), it has been held by the Andhra

Pradesh High Court that section 4(e) while speaking of any

special Indian law, is only speaking of special Indian law

made by the British Parliament as different from any Act

enacted by the British Parliament that might have

application to India also in common with the rest of the

British colonies. The learned Counsel, while placing strong

reliance upon the said interpretation of the words `special

Indian law' as made in Krishna Murthy's case (supra), also

submits that the expression should be interpreted in the

light of the setting of the same in the words of the

provision of section 4(e). In support of the contention, the

learned Counsel has drawn our attention to an obser-

968

vation made by this Court in R.L. Arora v. State of Uttar

Pradesh, [1964] 6 SCR 784 that a literal interpretation is

not always the only interpretation of a provision in a

statute and the court has to look at the setting in which

the words are used and the circumstances in which the law

came to be passed to decide whether there is something

implicit behind the words actually used which would control

the literal meaning of the words used. Accordingly, it is

submitted by the learned Counsel that as the words `special

Indian law' are placed after the words `an Act of Parliament

of the United Kingdom' and before the words `Royal Charter

or Letters Patent', it must be held in view of the setting

that the expression`special Indian law' refers or relates to

a special law enacted by an Act of British Parliament for

India.

We are unable to accept the contention. It may be that

interpreting the words of the provision of a statute, the

setting in which such words are placed may be taken into

consideration, but that does not mean that even though the

words which are to be interpreted convey a clear meaning,

still a different interpretation or meaning should be given

to them because of the setting. In other words, while the

setting of the words may sometimes be necessary for the

interpretation of the words of the statute, but that has not

been ruled by this Court to be the only and the surest

method of interpretation. In the instant case, the

expression `special Indian law' has a clear and unambiguous

meaning and there is no need for its interpretation. There

is no reasonable justification to think that the expression

`special Indian law' must be an enactment of the British

Parliament. If, on the date the Act was passed, there was no

Indian Legislature, such an interpretation might be

justified, but when there were existence of Indian

Legislatures including a Legislature at the Centre, it would

be quite unreasonable to think that `special Indian Law'

must be a law enacted by the British Parliament. In this

connection, we may refer to section 3(27)(a) of the General

Clauses Act, 1897, which defined `Indian law' as meaning any

Indian law enacted by the Indian Legislature. In view of the

said definition, the expression `special Indian law' means a

special Indian law enacted by the Indian Legislature. In the

face of the provision of section 3(27)(a) of the General

Clauses Act, as it stood on the day the Act was passed, we

do not think that there is any justification for laying down

that the expression `special Indian law' in section 4(e) of

the Act means a law enacted by the British Parliament

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specially for India. We are, therefore, unable to accept the

view of the Andhra Pradesh High Court in Krishna Murthy's

case (supra) and also the contention of the respondents made

in that regard, which is rejected.

969

The next contention made on behalf of the respondents

is that even assuming that the expression `special Indian

law' means a law enacted by the Indian Legislature and that

the Banking Companies Act is such a law, still the provision

of section 4(e) of the Act will not apply inasmuch as the

appellant Bank was not formed in pursuance of any `special

Indian law', but by or under a `special Indian law', that

is, the Banking Companies Act. It is submitted that there is

a good deal of distinction between the formation of a

corporation `in pursuance of' and `by or under', a special

Indian law. It is urged as the appellant Bank has been

formed by or under and not in pursuance of the Banking

companies Act. it is not a corporation within the meaning of

section 4(e) of the Act. In support of this contention, the

respondents have placed reliance on Krishna Murthy's

decision where it has been observed that the words `in

pursuance of' refer to the action taken under the law and

not by the law itself, and that the phrase `formed in

pursuance of' in section 4(e) signifies a process of

formation of a corporation under the law and not by the law

itself. Further, it has been observed that the words `in

pursuance of' can be said to have been used appropriately by

the Legislature only to signify the activity or formation of

a corporation carried on by an intermediary third party

acting under a law as different from an activity of

formation carried on by that law itself. We are afraid, such

a narrow and technical interpretation of the words `in

pursuance of' is contrary to the intention of the

Legislature. Although, theoretically, there may be a

distinction between the words `in pursuance of' and the

words `by or under', but by using the expression `in

pursuance of' in section 4(e) the Legislature, in our

opinion, has not meant that the corporation in question

should be formed by a third party in pursuance of the law

and not by the law itself in order to come within the

purview of section 4(e) of the Act. The intention of the

Legislature is very clear in that the provision of section

4(e) would apply to a corporation which is the creature of a

special Indian law, whether it is created in pursuance of or

by or under the special Indian law. There is no difference

or distinction whatsoever between the corporation formed in

pursuance of a special Indian law and a corporation formed

by or under a special Indian law. It will be highly

unreasonable and illogical to think that as a corporation

has been formed by or under a special Indian law and not in

pursuance of such a law, it will not come within the purview

of section 4(e) of the Act. Accordingly, we hold that the

Banking Companies Act is a special Indian law and the

provision of section 4(e) is applicable to the appellant

Bank.

The learned Counsel for the respondents has drawn our

atten-

970

tion to the fact that the Banking Companies Act was first

formed or created by the Ordinance VIII of 1969 promulgated

on July 19, 1969. The Ordinance was replaced by an Act of

Parliament being Act XXII of 1969 with certain

modifications. This Court, however in R.C. Cooper v. Union

of India, AIR 1970 SC 564 struck down the Act XXII of 1969

as unconstitutional. Thereafter, a fresh Ordinance being

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Ordinance No. III of 1970 was promulgated on February 14,

1970 with certain further modifications and, thereafter,

replaced by the present Banking Companies Act. It is

submitted that as the appellant Bank was nationalised and/or

created under the Ordinance VIII of 1969 promulgated on July

19, 1969 and the present Banking Companies Act only ratifies

the already created Bank under the said Ordinance, the

appellant Bank was not, therefore, formed or created under

any special Indian law. This contention is devoid of any

merit and fit to be rejected on the face of it. Even

assuming that the Bank was created under the Ordinance VIII

of 1969 and not under the Banking Companies Act, still it

must be held that it was created under a special Indian law,

for an ordinance is as much a law as an enactment of

Parliament or Legislature. In this connection, it may also

be pointed out that under sub-section (2) of section 1 of

the Banking Companies Act, the provisions of the Banking

Companies Act (except section 21 which shall come into force

on the appointed day) shall be deemed to have come into

force on July 19, 1969. Sub-section (1) of section 3 of the

Banking Companies Act provides that on the commencement of

the Banking Companies Act, there shall be constituted such

corresponding new Banks as are specified in the First

Schedule. Therefore, it is manifestly clear that the

appellant Bank, which is mentioned in the First Schedule,

has been created under the provisions of the Banking

Companies Act with effect from July 19, 1969. The contention

of the respondents that the Bank has been nationalised or

formed under the Ordinance VIII of 1969 is without any

substance whatsoever and is rejected.

We may refer to a decision of this Court in Life

Insurance Corporation of India v. Kota Ramabrahmam, AIR 1977

SC 1704. Gupta J. while delivering the judgment of the

Court, observes that there is no dispute that the

corporation established under the Life Insurance Corporation

Act, 1956 is a corporation as contemplated by section 4(e)

of the Act. This decision has been strongly relied upon by

the respondents in support of their contention that as the

major part of the loan, that is to say, a sum of Rs.

10,00,000, was contracted before the nationalisation of the

appellant Bank, the provision of section 4(e) is not

applicable. In Life Insurance Corporation's case the loans

were

971

advanced by the Andhra Insurance Company of Masulipatanam

and by Nagpur Pioneer Insurance Company Limited, Bombay,

admittedly, before the creation of the Corporation under the

Life Insurance Corporation Act, 1956 and it was held by this

Court that the debts due to the insurers in these two cases

were liable to be scaled down in accordance with the

provisions of the Act.

In the instant case, the amounts of loan were advanced

by the Bank to the firm under the cash credit account opened

in favour of the firm. Normally, the advances that are made

from the cash credit account are repaid and, thereafter,

fresh advances are made. It is not known what was the actual

balance on the date the Bank was nationalised. It is true

that in the judgment of the High Court it has been stated

that the principal amounts of Rs.3,00,000, Rs.7,00,000 and

Rs.80,000 were severally advanced by the Bank to the firm

under the cash credit account on 28-11-1967, 3-4-1968 and

17-2-1972 respectively. But, there is no further statement

whether the first two amounts were repaid by the firm and,

thereafter, fresh advances were taken out of the cash credit

account. The respondents did not advance any such contention

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either in their written statements or in the arguments

before the Trial Court and the High Court. It is for the

first time before this Court that such a plea is raised in

the argument of the learned Counsel for the respondents. The

contention involves a question of fact which has to be

pleaded and proved. In the absence of any such pleading, we

are unable to allow the respondents to raise such a

contention for the first time in argument before this Court.

At this stage, it may be stated that in Krishna

Murthy's case (supra) it has been held by the Division Bench

that the latter part of section 4(e) of the Act containing

the words `any debt due to any Corporation formed in

pursuance of an Act of Parliament of the United Kingdom or

any special Indian law or Royal Charter or Letters Patent'

is offensive to Article 14 of the Constitution and,

accordingly, void. The learned Counsel for the respondents

submits that in view of the decision in Krishna Murthy's

case, this Court should declare the latter part of section

4(e) of the Act to be void as offending Article 14 of the

Constitution, although no such point has ever been taken by

the respondents up to this Court. On the other hand, it is

submitted by the learned Additional Solicitor General that

the said finding of the Division Bench in Krishna Murthy's

case to the effect that the latter part of section 4(e) of

the Act is void, is erroneous.

The reasons given by the Division Bench of the Andhra

Pradesh

972

High Court in Krishna Murthy's case for holding the latter

part of section 4(e) of the Act as void, are that section

4(e) of the Act was enacted to protect the British economic

interests and although such a law could permissibly be

enacted under the Constitutional Scheme of the 1953

Government of India Act, that law after the inauguration of

our Sovereign Democratic Republic cannot but be held to have

become void as making invidious discrimination in favour of

the British Corporation offending against the equality

clause under Article 14 of the Constitution. Before

declaring the same as void, the Division Bench took the view

that the words `any special Indian law' could not have been

intended to refer to any law made by any Legislature of our

country, but to a law made by the British Imperial

Parliament as a piece of special legislation applicable to

India. It has already been discussed by us that the words

`any special Indian law' refers and relates to a law made by

the Indian Legislature and not by the British Parliament. In

that view of the matter, the reasons given by the Division

Bench for holding the latter part of section 4(e) to be void

as making a discrimination in favour of corporations created

by British Parliament, will not apply to corporations formed

or created by any special Indian law which, in the instant

case, is the Banking Companies Act. In our opinion,

therefore, the Banking Companies Act is quite legal and

valid. No other point has been urged by either party in this

appeal.

In view of the discussion made above, we hold that the

provisions of the Act are not applicable to the appellant

Bank and, therefore, there is no question of scaling down

the debt due to the Bank by the respondents.

For the reasons aforesaid, the judgment and decree of

the High Court in so far as the same direct the scaling down

of the debts due to the Bank by the respondents, are set

aside. The Bank will be entitled to realise the amount

decreed in its favour by the High Court without any scaling

down of the same under the provisions of the Act.

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The appeal is allowed. There will, however, be no order

as to costs in this Court.

N.P.V. Appeal allowed.

973