Chapter III OF SUITS AND OTHER PROCEEDINGS TO WHICH AGRICULTURISTS ARE PARTIES

7.

History of transactions with agriculturist-debtors to be investigated History of transactions with agriculturist-debtors to be investigated.-In any suit of the description mentioned in section 3, clause (b), in which the defendant, or any one of the defendants, is an agriculturist, the Court if, the amount of the creditor's claim is disputed, shall examine both the plaintiff and the defendant as witnesses unless, for reasons to be recorded by it in writing, it deems it unnecessary so to do and shall enquire into the history and merits of the case, from the commencement of the transactions between the parties and the persons (if any) through whom they claim out of which the suit has arisen, first, with a view to ascertaining whether there is any defence to the suit on the ground of fraud, mistake, accident, undue influence or otherwise, and, secondly, with a view to taking an account between such parties in manner hereinafter provided. When the amount of the claim is admitted and the Court, for reasons to be recorded by it in writing, believes that such admission is true and is made by the debtor with a full knowledge of his legal rights as against the creditor, the Court shall not be bound so to enquire, but may do so if it thinks fit. In other cases in which the amount of the claim is admitted, the Court shall be bound to enquire as aforesaid.

Mode of taking accounts Mode of taking accounts.-

1. (1) When the Court enquires into the history and merits of a case under section 8, it shall, notwithstanding any agreement between the parties or the persons (if any) through whom they claim, as to allowing compound interest or otherwise determining the manner of taking the account, and notwithstanding any statement or settlement of account, or any contract purporting to close previous dealings and create a new obligation, open the account between the parties from the commencement of the transactions, and take that account according to the rules laid down in sub-section
2. (2) : Provided that, in the exercise of the powers conferred by this and the last preceding section the Court shall not re-open any agreement or contract purporting to close previous dealings and create a new obligation which has been entered into by the parties or the persons (if any) through whom they claim, or go behind and beyond a statement or settlement of account which is of a date prior to the first day of Baisakh, 1978 : Provided further that, nothing hereinbefore contained and nothing contained in section 10 shall be deemed to authorise the Court to re-open any agreement, contract or account when the account has been finally closed and settled between the parties or the aforesaid persons leaving no subsisting liabilities between them.
3. (2) The Court shall take the account under sub-section
4. (1) in accordance with the following rules, namely :-
   • (a) In the account of principal there shall be debited to the debtor such money as may from time to time have been actually received by him or on his account from the creditor as part of the transactions, but not any accumulated interest which has been converted into principal at any statement or settlement of account or by any contract made in the course of the transactions : Provided that, the Court shall allow such debit when such statement, settlement or contract is of a date prior to the first day of Baisakh, 1978.
   • (b) In the account of interest there shall be debited to the debtor monthly simple interest on the balance of the principal for the time being outstanding at the stipulated rate of interest or, in its absence, at the rate considered fair by the Court, not exceeding in either case twelve per centum per annum on such balance.
   • (c) All money paid by or on account of the debtor to the creditor or on his account, and all profits, service or other advantages of every description, received by the creditor in the course of the transactions (estimated, if necessary, at such money value, as the Court in its discretion, or with the aid of arbitrators appointed by it, may determine), shall be credited first in the account of interest, and when any payment is more than sufficient to discharge the balance of interest due at the time it is made, the residue of such payment shall be credited to the debtor in the account of principal.
   • (d) The accounts of principal and interest shall be made up to the date of instituting the suit and the aggregate of the balances (if any) appearing due on both such accounts on that date shall be deemed to be the amount due at that date; except when the balance appearing due on the interest-account exceeds one-half of that appearing due on the principal account, in which case the latter balance plus one-half thereof shall be deemed to be the amount then due. The party from whom this amount is thus found due shall be bound to repay it, whether such party is a plaintiff or a defendant in the suit, and the Court shall by its decree declare and direct accordingly.
   • (e) For the purposes of clauses
   • (a) and
   • (c) the value of the produce for which a record of prices is kept in the local Tehsil office shall be debited or credited, as the case may be, at such rates for the month during which such produce was sold, advanced, supplied or received.

Agriculturist-debtor may sue for accounts.-Any agriculturist may sue for an account of money lent or advanced to or paid for him by a creditor, or due by him to the creditor as the price for goods sold, or on a written or unwritten engagement for the payment of money and of money paid by him to the creditor, and for a decree declaring the amount, if any, still payable by or to him to or by the creditor. Amount of debts in such cases to be determined according to foregoing provisions.-When any such suit is brought the amount (if any) payable by the plaintiff or the defendant shall be determined under the same rules as would be applicable under this Act, if the creditor had sued the plaintiff for recovery of the debt.

Decree under section 10 shall provide for payment by instalments. Execution of decrees under this section.-A decree passed ex parte or otherwise under section 10 shall, besides, declaring the amount due, direct that such amount shall be paid in one or more instalments, with or without interest, and, judgment-debtor may pay the amount of such decree, or the amount of each instalment fixed by such decree as it falls due, into Court, in default whereof execution of the decree may be enforced by the decree-holder in the same manner as if he had obtained a decree in a suit to recover the debt.

Payment into Court in cases under section 10.-The plaintiff in any suit instituted under section 10 may at any stage of such suit deposit in Court such sums of money as he considers a satisfaction in full of the defendant's claim against him. Notice of deposit shall be given by the Court to the defendant, and the amount of the deposit shall (unless the Court otherwise directs) be paid to the defendant on his application.

Instalments Instalments.-In cases other than those provided for in section 11 at the time of passing a decree ex parte or otherwise against an agriculturist in a suit to which this Act applies, the Court shall by such decree direct that the amount of the decree shall be paid in one or more instalments, with or without interest.

Instalments to be within paying capacity of judgment-debtor.-The number, amount and intervals for the payment of the instalments fixed by the Court under section 11 or 13 shall be fixed within the paying capacity of the judgment-debtor: Provided that,-

1. (a) the whole of the unrealized balance of the decretal amount shall be recoverable in lump at once in case default is made by the judgment-debtor in the payment of two or more consecutive instalments unless such default was due to abnormal circumstances beyond the control of the judgment-debtor which in the opinion of the Court executing the decree entitled the judgment-debtor to an extension in the period of instalments ;
2. (b) the Court which passed the decree or to which the decree is transferred for execution, if it is satisfied that a substantial change has taken place in the paying capacity of the judgment-debtor may, on the application of the decree-holder or the judgment-debtor from time to time, vary the number and alter the amount of instalments fixed by the decree to suit the changed paying capacity of the judgment-debtor. Explanation.-"Paying capacity" means the amount which the judgment-debtor can reasonably be expected to pay after providing for the exercise of his avocation and for the essential necessities of himself and of such members of his family as are dependent on him.

Limit of further interest.-The rate of further interest allowed in any decree passed in a suit to which this Act applies shall not exceed twelve per centum per annum and the aggregate amount of further interest so allowed shall not exceed one-half of the amount decreed exclusive of costs.