V. Muthuvel Mudaliar vs P. Punyakoti Naidu and Others

Natarajan, J.—Failing in his attempt to get himself declared as a debtor entitled to protection under the Tamil Nadu Debt Relief Act 40 of

1979, before the Civil Courts, the petitioner now seeks to invoke the extra-ordinary jurisdiction of this Court under Art. 226 of the Constitution to

seek the issue of a writ of declaration declaring S. 3(3)(iii) of the Tamil Nadu Debt Relief Act 40 of 1979 to be ultra vires the Constitution and

void and to strike it down as unconstitutional. The petitioner is the owner of a house property bearing door No 40, Kumaraswami Mudali Street,

Perambur, Madras 11. The petitioner created a simple mortgage over a portion of the property in favour of the first respondent for a sum of Rs.

6,000, under a registered mortgage deed of the year 1966. Subsequently, he created another mortgage over the said property in the year 1967 in

favour of the second respondent, who is none other than the son of the first respondent, for a sum of Rs. 6,500. Respondents 1 and 2 filed suits to

enforce the mortgages and have obtained preliminary and final decrees. Besides taking up a defence that the mortgages were not fully supported

by consideration, the petitioner also raised a plea that he is entitled to claim protection under the Tamil Nadu Debt Relief Act 40 of 1979. He

raised such a plea on the ground that his annual rental income was below Rs. 2400. The trial Judge rejected the claim on the ground that since the

petitioner is owing a house property which is being assessed to house tax on the basis of the annual rental value of not less than Rs. 1,200, the

petitioner is not entitled to claim protection under the Act. The petitioner challenged the order of the trial Judge before the Appellate Judge by filing

a civil miscellaneous appeal; but the Appellate Judge too dismissed the appeal, rejecting the petitioner''s contention. Having failed before the Civil

Courts, the petitioner wants to attack the constitutional validity of S. 3 (3) (iii) of the Act as unconstitutional.

For the purposes of this petition, it is necessary to refer to the sub-S.(3) of S. 3 of the Act. The sub-section defines a ''debtor'' as a person from

whom any debt is due. Then the proviso sets out various categories of persons, who cannot be deemed to be debtors within the meaning of the

Tamil Nadu Debt Relief Act, 40 of 1979 (hereinafter referred to as the Act). The proviso sets out five categories of persons in Cls.(i)(a), (i)(b),

(ii), (iii) and (iv). Cl.(i)(a) refers to persons assessed to income tax under the Income Tax Act, 1961, or any analogous law in force in any other

country and Cl.(1)(b) refers to persons assessed to agricultural income tax under the Tamil Nadu Agricultural Income Tax Act 1955 or any

analogous law in force in any State or Union territories in India, during both the financial years, ending on 31st March, 1977 and 31st March,

1978. Cl.(ii) refers to parsons, who have bean assessed to sales tax under the Tamil Nadu General Salts Tax Act 1959 or the Central Sates Tax

Act 1956, in both the financial years ending 31st March, 1977, and 31st March, 1978. Cl. (iii) refers to persons assessed to property or house tax

in respect of the buildings or lands other than agricultural lands under the District Municipalities Act or the City Municipal Corporation Act or the

Panchayat Act or the Cantonment Act, or any analogous law in all the four half years immediately preceding 1st March, 1978, provided that the

aggregate annual rental value of such buildings and lands, whether let out or in the occupation of the owner, is not less than Rs. 1,200. The

Explanation to Cl. (iii) sets out the manner of calculation of the annual rental value but, for the purpose of this petition, those details are not

necessary. Then comes Cl. (iv), which refers to persons assessed to profession tax in all the four half years immediately preceding the 1st March,

1978 on a half yearly income of more than Rs. 1,200, derived from a profession other than agriculture.

The contention of the petitioner is that under Cl. (iv) of the sub-section, the upper limit of Rs. 1,200 per half year or Rs. 2,400 per annum has

been fixed for persons paying profession tax to be denied the protection under the Act; but under Cl. (iii), the upper limit for persons paying

property tax to claim the benefit of the Act has been fixed at Rs. 1,200 per annum. Therefore, there is a discrimination between persons paying

profession tax and persons paying property tax, to claim the protection under the Act. The contention of the petitioner is based on a

misconception. The proviso lists out various categories of persons, who in the opinion of the Legislation, would not be entitled to claim the status of

a debtor and seek relief under the Act. It is on account of that, Cl. (i) refers to assessees under the Income tax Act and Agricultural Income tax

Act; Cl. (ii) refers to assesees under the Sales tax Act; Cl. (iii) refers to assessees of house tax or property tax; and Cl. (iv) refers to persons

assessed to profession tax. Each category of person has to be treated separately. While the Income tax assessee will be liable to pay income tax

only if his income is more than Rs. 15,000 per annum, a person will be liable to pay profession tax when his income exceeds Rs. 200 per month or

Rs. 2,400 per annum. As regards Sales tax assessees, their income is not taken into consideration, but their turnover, is taken into consideration.

The owner of a house is liable to pay house tax on the annual rental value or on an estimated 5 per cent return on the capital value of the building. It

is, therefore, wrong to find a common bond between these five categories of persons and then raise an argument that the Act has made a

discrimination with reference to persons who can claim relief under Cl. (iii) and (iv) of the Act. The question of discrimination will arise only when

persons of the same category, are treated in a different manner. When they belong to different categories it is futile to contend that they stand on

the same footing and therefore, parity of treatment should be given. The contention of the petitioner is therefore clearly misconceived.

Consequently, the issue of rule is not called for and the petition will stand dismissed.