Andhra Pradesh High Court
Judges : A.SAMBASIVA RAO, V.MADHAVA RAO
Madali Narasimha Rao - Appellant
Versus
Neerla Rangaiah - Respondent
Decided On : 07-03-74
REVENUE RECOVERY ACT - SALE - PUBLICATION OF NOTICE - TIME - MATERIAL IRREGULARITY - ILLEGALITY - DISTINCTION - EFFECT OF FAILURE TO PUBLISH NOTICE - JURISDICTION OF OFFICER TO SELL - WAIVER OF OBJECTION - EFFECT.
Fact of the Case:
In two separate cases, the plaintiffs, who were excise contractors, challenged the validity of revenue sales conducted by the defendants. The plaintiffs' agricultural lands were sold in revenue auctions after they fell into arrears. The plaintiffs claimed that the sales were null and void due to irregularities in the publication of the sale notices. In one case, the sale was held without any proclamation, while in the other, the sale was held within 30 days of the proclamation.
Finding of the Court:
The court held that the sales were indeed null and void. The court distinguished between material irregularity and illegality, holding that material irregularity does not render a sale void unless substantial injury is proven, whereas illegality renders a sale void ab initio. The court found that the failure to publish the sale notice or conducting the sale within 30 days of the publication was an illegality that deprived the defaulter of a valuable right to avoid the sale by tendering the requisite amounts. The court also held that the plaintiffs' failure to object to the manner of notice at the time of the sales did not preclude them from questioning the validity of the sales in the suits, as the sales were void.
Issues: 1. Whether the sales were null and void due to irregularities in the publication of the sale notices? 2. Whether the failure to publish the sale notice or conducting the sale within 30 days of the publication was a material irregularity or an illegality? 3. Whether the plaintiffs' failure to object to the manner of notice at the time of the sales precluded them from questioning the validity of the sales in the suits?
Ratio Decidendi: 1. The court held that the sales were null and void due to irregularities in the publication of the sale notices. 2. The court distinguished between material irregularity and illegality, holding that material irregularity does not render a sale void unless substantial injury is proven, whereas illegality renders a sale void ab initio. The court found that the failure to publish the sale notice or conducting the sale within 30 days of the publication was an illegality that deprived the defaulter of a valuable right to avoid the sale by tendering the requisite amounts. 3. The court held that the plaintiffs' failure to object to the manner of notice at the time of the sales did not preclude them from questioning the validity of the sales in the suits, as the sales were void.
Final Decision: The court dismissed the defendants' appeals and affirmed the decrees in the suits, holding that the two sales in question suffered from grave illegality and were consequently null and void.
( 1 ) THE validity of two revenue sales is in question in these two letters patent appeals. They arise out of second appeals Nos. 610 and 61 of 1970, which were dismissed by our learned brother madhava Reddy J. , affirming the decisions of the Courts below. It is the unanimous decision that the revenue sales are nullities. The learned Judge, however, granted leave and so, the aggrieved defendants have filed these letters patent appeals
( 2 ) THE plaintiffs, who are the contesting respondents in the appeals were excise Contractors. As they fell in arrears their agricultul at lands were sold in revenue auctions where the appellants purchased them. The two cases vary from each other in material facts.
( 3 ) IN L. P. A. No. 219 of 1972, which arises out of O. S. No. 10/61 on the file of the District Munsiff s Court, Sircilla, the plaintiffs had been in arrears by 1955. So, a demand notice was issued to them for payment of Rs. 1497/-, which was the amount in arrears. The present suit properties were then attached on 16-5-1955 However, the plaintiffs and their partners paid the entire amount under demand by 30th Occober, 1956 before the properties were sold. Again fresh demand notices were issufd to them on 7-11-56, this time claiming Rs. 3, 147/- as arrears for a later period. Though the demand notices were given, properties were not attached; nor was there any hypothecation of the suit properties to the Government. In the name of the district Collector, the properties were sold in revenue auction on 13th June, 1959 without observing any formalities like artzchment, sale proclamation, previous permission of the Collector etc. Therefore the District Collector refused to confirm the sale, feeling that it was wholly repugnant to the law. Thereupon the Tahsildar decided on 25th of September, 19s9 to hold a fresh auction on 1-10-1959. On that day, the properties were again sold without observing any of the formalities that are required under the law. The appellants before us purchased the lands in that auction.
( 4 ) IN O. S. No. 9 of 1961, out of which L. P A. No. 218/72 arises, the suit lands were attached in the process of recovery of the an-ears on 30th April, 1958. A proclamation dated 5th May. 1959 was made fixing the auction to 13th june, 1959. On the day fixed there were no bidders, So, the Tahsildar issued a fresh proclamation on 26th September, 1959, fixing the date of auction as 1-10-1959. On the day thus appointed the auction was held arid ihe appellants in the appeal happended co be the highest bidders. On 10-11-1959 this auction was confirmed.
( 5 ) THE plaintiffs in both the cases took proceedings for setting aside the sales. They were obviously under the impression shall the Hyderabad Land revenue Act would apply to these proceedings. So, when hey failed before the Collector, they tiled a further appeal to the Board of Revenue where also they failed. A further revision was presented to the Government. Even when the revisions were pending the present suits were filed seeking a declaration that he auction sales are null and void, and also recovery of possession of the lands.
( 6 ) THE main ground of attack on the sales was that auctions were conducted in one case without any proclamation and in the other within 30 days after proclamation. It was, therefore, argued that the sales were null and void. Obviously because of this contention no attempt was made by the plaintiffs to prove chat the sales resulted in substantial loss to them, with the result that there was no issue, no evidence and no finding by the Courts below on this aspect of the matter.
( 7 ) THE defendants resisted the claims by contending that what the plaintiffs alleged was at the most only a material irregularity in making the proclamation or conducting the sale and so the sales could not be set aside unless substantial loss was put in issue, proved and found Since that was not done, the suits should fail.
( 8 ) THE plaintiffs contention fo
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