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Andhra Pradesh High Court
Judges : JAGMOHAN REDDY, VENKATESWARA RAO
Puttaparatti Atchamma - Appellant
Versus
T.Bayanna - Respondent
Decided On : 04-10-68
EXECUTION SALE - SETTING ASIDE - GROUNDS - DECREE-HOLDER PURCHASING PROPERTY WITHOUT OBTAINING PERMISSION TO BID - ORDER GRANTING PERMISSION TO BID WITHOUT NOTICE TO JUDGMENT-DEBTOR - WHETHER SALE CAN BE SET ASIDE UNDER ORDER 21, RULE 72 C. P. C. - WHETHER SUBSTANTIAL LOSS OR INJURY TO JUDGMENT-DEBTOR MUST BE PROVED.
Fact of the Case:
The decree-holders purchased two houses belonging to the respondents in execution of a mortgage decree. The respondents filed an application under Order 21, Rule 90 and Sections 47 and 151 of the Code of Civil Procedure to set aside the sale, alleging that the decree-holders had not obtained leave to bid, that the permission granted to the decree-holders to bid at the sale was illegal and void as no notice of that application was given to him, and that there was mis-description of the property that was put up for sale. The executing court dismissed the petition, and the respondents appealed to the District Judge, who set aside the sale.
Finding of the Court:
The High Court held that the order granting permission to bid without notice to the judgment-debtors was not null and void, but at best invalid or illegal. The court also held that the sale could not be set aside under Order 21, Rule 72 (3) C. P. C. as the decree-holders had obtained permission to bid, though without notice to the judgment-debtors. However, the court remanded the matter to the District Judge to record a finding on the question of whether the respondent had notice of the petition for reduction of upset price and if not, whether as a result thereof, he sustained substantial loss or injury entitling him to have the sale set aside.
Issues: 1. Whether a sale can be set aside under Order 21, Rule 72 C. P. C. on the ground that the decree-holder-purchaser had not obtained leave to bid, without the judgment-debtor proving also that he sustained substantial loss or injury. 2. Whether the order granting permission to bid without notice to the judgment-debtors was null and void. 3. Whether the sale could be set aside under Order 21, Rule 72 (3) C. P. C. as the decree-holders had obtained permission to bid, though without notice to the judgment-debtors.
Ratio Decidendi: 1. The court held that an order giving or refusing to give leave to bid at an execution sale is only a ministerial or administrative order and that notice before ordering an application for leave to bid cannot be considered essential. 2. The court held that the order granting permission to bid without notice to the judgment-debtors was not null and void, but at best invalid or illegal, as the executing court had an undoubted jurisdiction to make the order in question. 3. The court held that the sale could not be set aside under Order 21, Rule 72 (3) C. P. C. as the decree-holders had obtained permission to bid, though without notice to the judgment-debtors.
Final Decision: The High Court set aside the decree and order of the District Judge and remanded the matter to him for disposal afresh after recording a finding on the question of whether the respondent had notice of the petition for reduction of upset price and if not, whether as a result thereof, he sustained substantial loss or injury entitling him to have the sale set aside.
( 2 ) THE petitioners obtained a decree against the respondents, in O. S. 43/57 on the file of the District Munsif, Anantapur, on the foot of mortgage. Two houses belonging to the respondents were brought to sale in execution of that decree and were purchased by the petitioners themselves on 20-7-59. The first respondent, Bayanna, moved the executing court in E. A. 405/59 under O. 21, R. 90 and Sections 47 and 151 of the Code of the Civil Procedure for setting aside the said sale alleging (1) that the sale which was fixed for 17-7-1959 was adjourned without notice to the judgment debtors and bidders to 20-7-1959 with the result that it did not fetch a proper price, (2) that the permission granted to the decree-holders to bid at the sale is illegal and void as no notice of that application was given to him and also because the decree-holders managed to obtain the said permission by fraudulent misrepresentation to Court, (3) that he had no notice of the petition filed by the decree-holders for reduction of the upset price either, and (4) that there was mis-description of the property that was put up for sale and that as a result of the aforesaid fraud and irregularities in the publication and conduct of sale, he sustained substantial injury. The decree holders denied, in their counter, that there were any irregularities or fraud in the publication and conduct of the sale. The learned District Munsif held that the respondents had notice of the petition to reduce the upset price, that no notice was necessary in E. A. No. Nil of 1959 filed by the decree-holder for leave to bid as an earlier application E. A. 820/59 for a similar relief was allowed after notice to the judgment-debtors, that the alleged mis-description of property is of no consequence as the identity thereof was never in doubt having regard to the fact that it was described by boundaries and that the postponement of the sale from 17-7-1959, which happened to be a public holiday, to 20-7-1959, the next working day, is neither irregular nor illegal as all concerned were aware of this postponement. He accordingly dismissed the petition with costs. The learned District Judge, to whom the matter was carried in appeal with the court of first instance that the postponement of the sale from 17-7-59 to 20-7-59 or the wrong description of the property did not vitiate the sale adverting to the other objection based on the absence of notice to the respondents on the application for leave to bid, he concluded that the decree-holders managed to secure the leave by making a false representation to the court, that in their earlier application. E. A. 826/58 filed for the same purpose, notice was issued to the judgment-debtors when in fact this is not the case and that the order D/- 20-7-59, granting permission to the decree-holders to bid at the sale, is consequently illegal besides amounting to a material irregularity entitling the respondents to have the sale set aside without the need to prove that they suffered substantial loss. He accordingly set aside the sale following Raghavachariar v. Murugesa Mudali, AIR 1923 Mad 635 wherein it was held that"the court has inherent power to refuse to allow the sale to be carried out if it is satisfied that the court has been misled either
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