Back
IN THE HIGH COURT OF KARNATAKA, BENGALURU
K.N. PHANEENDRA, J.
SRI. L. NANJUNDA MURTHY, S/O MR. K. LINGAIAH - APPELLANTS
Vs.
SRI. S. SURESH REDDY, S/O. A. SRINIVASA REDDY – RESPONDENT
M.F.A. NO. 1968 of 2016 (CPC)
Decided on : 10-02-2017
CODE OF CIVIL PROCEDURE, 1908 – Order 21, Rule 90 r/w Section 151 CPC – Writ Petition against order rejecting IA made by Judgment-Debtor for setting aside Court sale – Allegation that sale proclamation was defective, collusion between decree holder and auction purchase – Objection not taken at the time of sale – Fraud was not established – No substantial injury was caused to judgment-debtor.
CODE OF CIVIL PROCEDURE, 1908 – Order 21, Rule 90 – Setting aside of execution sale – Ground of fraud has to be distinctly raised in pleadings – Fraud stands on higher footing than material irregularity and has to be proved beyond doubt – Mere pleading that purchaser was relative of decree- holder and leading no evidence as to how he prevented highest bidder from participating in court sale – Held, It does not prove fraud.
CODE OF CIVIL PROCEDURE, 1908 – Order 21, Rule 90 – Setting aside of execution sale – Neither material irregularity nor fraud by itself is sufficient to set aside sale – Fact that substantial injury was caused to judgment-debtor has to be established – Plea that property of higher value sold at throw away price – Judgment-debtor however failing to furnish estimated value of property either at time of proclamation or at time of spot sale or court sale despite opportunity – Basis of valuation of property also not given – Judgment-debtor in circumstances cannot be said to have suffered substantial injury – Execution sale is not liable to be set aside.
CODE OF CIVIL PROCEDURE, 1908 – Order 21, Rules 90, 66(2)(e)(Kar) – Setting aside of execution sale – Defect in proclamation – Failure to give opportunity to parties to furnish price of property to be auctioned and consequent non-mention of price of property as given by decree-holder and judgment-debtor in sale proclamation (Form 29) is a material irregularity.
FORESTS (CONSERVATION) ACT, 1980 – Fraud – In order to establish fraud, the party must be distinctly raise the same in the pleadings with sufficient pleadings and it has to be proved to the satisfaction of the Court with cogent and convincing evidence. Mere pleading in the affidavit which is specifically and categorically denied by the other side does not amount to proof of the alleged fraud. Fraud is both civil wrong and a Criminal act which leads to severe consequences. The word fraud cannot be equated to material irregularity, but it stands on the higher footing than the material irregularity. Therefore, it should be established beyond doubt to show that the fraud has been played and resulted in substantial injury to the judgment debtor.
The appellants have called in question the order dated 21.1.2016 passed in Execution No.3242/2014 on IA No.IV filed under Order XXI Rule 90 read with Section 151 of CPC passed by XXXI Addl. City Civil & Sessions Judge (CCH 14), Bengaluru City, and consequently to set aside the sale held on 11.09.2015 at the spot and the Court sale dated 28.9.2015.
2. The brief factual matrix of the case are that:
The plaintiff (respondent No.1 herein) has filed a suit in OS No.6181/2011 for recovery of a sum of Rs.93,82,74276. The plaintiff decree holder sued out execution for recovery of the said amount in Execution No.3242/2014. The said Execution Petition was contested by the judgment debtor. After following some procedure, the Court has ordered for auction sale of the Schedule property for recovery of the above said amount. The judgment debtor after the sale has been effected by the Court on 28.9.2015 has filed an application under Order 21 Rule 90 read with Section 151 of CPC, seeking for setting aside the said sale which was executed in favour of the highest bidder the second respondent herein Sri K. Ganesh son of K.V. Keshava Murthy. On various grounds, the said application was contested by the decree holder and after hearing, the executing Court has come to the conclusion that the said application is devoid of merit and the same has been dismissed.
3. The learned counsel for the appellants in support of the grounds urged in the Memorandum of Appeal contended before this Court that the second respondent is no other than the brother-in-law of the decree holder and there is a collusion for the purpose of participating in the auction sale on the spot and before the Court. Therefore, the said order is liable to be set aside. Further, it is contended that the sale proclamation which was issued on 26.8.2015, is not in accordance with law and the same is in violation of order 21 Rule 66(2) of CPC and it is not in conformity with Form No.29 as contained in CPC. Mandate of the statute has not been followed by the executing Court, and the court has not even looked into the Karnataka amendment to the said provision. Therefore, the sale on this ground is liable to be set aside. It is further contended that there is no semblance of material in the order sheet of the trial Court that the Court has called upon the parties to furnish the estimated value of the property before putting the property into public auction. It is further contended that in the auction sale one Mr. T.N. Harish Kumar was the highest bidder, bid the property for a sum of Rs.1,40,000/that shows that the value of the property is much more than the amount for which it was sold by the Court. The Court would not have accepted an amount of Rs.1,10,00,000/offered by the second respondent in the Court sale, it ought to have set aside the proceedings and reauctioned the property. Lastly, it is contended that the property is worth more than Rs.1,75,00,000/and there is no fixation of any amount by the Court as the minimum bid amount. However, the bailiff on the spot quoted the minimum bid amount at Rupees 75 lakhs which is also not based on any statutory empowerment. Therefore, for all these reasons, the learned counsel sought for setting aside the sale.
4. Per contra, the learned counsel appearing for the respondents has seriously contended that though there is some irregularity in filling up Form 29 and also some procedure has not been followed by the Court under Order 21 Rule 66 of CPC, but no substantive injury caused to the appellant as the said provision only says, that the parties can also provide the estimated value of the property.
5. It is contended that no such ground was taken up before the trial Court with regard to irregularity alleged to have been committed by the trial Court. This stand was not urged either at the time of filing the application under Order 21 Rule 90 of CP
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
