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1979 Supreme(Bom) 156

Bombay High Court
SHARAD MANOHAR
Vishwanath Maharudra Matkari - Appellant
Versus
Jan Mohammed - Respondent
Decided On : 08/08/1979

Advocates:
A.M. Dabir for A.H. Vaishnav, for Appellant; A.B. Naik (for No.1) and A.G. Godhamgaonkar (for No.2), for Respondents.

Headnote:

AUCTION PURCHASER - RIGHT TO RECOVER PURCHASE MONEY - NO SALEABLE INTEREST IN PROPERTY - LIABILITY OF DECREE HOLDER/JUDGMENT DEBTOR - REMEDY - SUIT FOR RECOVERY OF PURCHASE MONEY - MAINTAINABILITY - PRINCIPLES OF MONEY HAD AND RECEIVED - APPLICABILITY - COURT ANALYSIS AND CONCLUSION.

Fact of the Case:

An auction purchaser (plaintiff) purchased a property in a court sale, but later it was found that the judgment-debtor had no saleable interest in the property. The plaintiff filed a suit against the decree-holder and the judgment-debtor for the recovery of the purchase money.

Finding of the Court:

The court held that the plaintiff had no right to recover the purchase money from either the decree-holder or the judgment-debtor. The court found that there was no warranty of title given by the decree-holder or the judgment-debtor, and that the plaintiff had purchased the property at a risk. The court also held that the principle of money had and received was not applicable in this case, as the plaintiff had not paid the money to the decree-holder or the judgment-debtor.

Issues: 1. Whether the auction purchaser had any right to recover the purchase money deposited by him in the Court for the purpose of purchase of the property brought for sale in the execution proceedings on account of the fact that the judgment-debtor had no saleable interest in the property after the confirmation of the sale. 2. If he had any such right, who was the person, between the judgment-debtor and the decree-holder, upon whom the corresponding liability could be fastened. 3. Assuming that by virtue of the right In the auction-purchaser and the corresponding liability upon either of the judgment-debtor or the decree-holder there arose a cause of action in favour of the auction-purchaser, what was his remedy? Whether his remedy lay only within the machinery provided by Order 21 of the Civil P.C. or whether an independent suit was maintainable. 4. What would be the nature of the suit? That is to say, would it be founded in Torts, Contract, quasi-contract and so on?

Ratio Decidendi: 1. The auction-purchaser had no right to recover the purchase money from either the decree-holder or the judgment-debtor. 2. The principle of money had and received was not applicable in this case, as the plaintiff had not paid the money to the decree-holder or the judgment-debtor.

Final Decision: The appeal filed by the decree holder was allowed. The decree passed by the lower Court was set aside and the one passed by the trial Court was restored. The appeal was allowed with costs against the plaintiff.

JUDGEMENT :- A very interesting and rather important question of law arises in this Second Appeal. The question relates to the right of an auction purchaser in a Court sale, who has purchased property but has found to his surprise that the judgment- debtor had no saleable interest in the property that he (auction-purchaser) purchased. The question is, whether he can proceed against the decree-holder and/or judgment-debtor for the recovery of the moneys paid by him for the purchase of the property in auction .Normally speaking it would have been enough for me to refer to the Division Bench the judgment of this Court in Santimmappa v. Balbhim Co-operative Credit Society, AIR 1950 Bom 313, and allow the appeal However, I find that certain aspect of the question which did not fall for consideration of the Division Bench remained, undecided in the said decision presumably on account of the peculiar pleadings in that case. I find that without a decision being given on that aspect, the question falling for the consideration of this Court cannot really be said to have been fully decided and this is what has propelled me to give a rather fulsome judgment on the case as a whole.

2. The facts of the case fall within a very narrow compass. For the sake of convenience I will refer to the parties, with reference' to their position in the original execution proceedings, that is to say, as judgment-debtor, decree holder and auction-purchaser. Sometime before the year 1965 one Vishwanath had obtained a money decree against Moiz Gayasuddin, the judgment-debtor. In execution of the decree, he filed Darkhast No.2 of 1965 and brought the house property, presumably in possession of the judgment-debtor, for sale. On 3rd April, 1965, the said house was purchased by Jan Mohomed, hereinafter referred to as the plaintiff/auction-purchaser, for a sum of Rs. 4,025/-. The said sale was confirmed on 9-7-1965. After this confirmation, out of the amount of the sale proceeds, a sum of Rupees 1,600/- receivable by the decree-holder under the decree was paid to the decree-holder by the Court and the balance of the amount was paid by the Court to the judgment- debtor. A sale certificate was issued in favour of the auction-purchaser, which is Ex. 43 in these proceedings, on 9-7-1965.

3. It appears that either during these proceedings of the sale of the house in auction or immediately after 9-7-1965, Suit No.145/65 was filed by one Mahemudabi (who was none other than the wife of Gayasuddin, the judgment-debtor himself) for a declaration that it was she who was the owner of the property and that the judgment-debtor had not a title of right to have the property sold for satisfaction of the decree passed against him. She also applied for injunction restraining the decree-holder from interfering with her possession of the suit house. The said suit was decreed on 30-6-1967. The appeal against the said decree came to be dismissed on 11-6- 1968. It was in these circumstances that the present Suit No.229/69 was filed by the auction-purchaser on 29-10-1969 both against the decree-holder as well as the judgment- debtor for recovery of the amount of Rupees 4,025/-, that is to say, the purchase money which he had paid for the purchase of the house in question. The decree-holder was defendant No.1 and the judgment-debtor was defendant No.2 in the said suit. The learned trial Judge came to the conclusion that the plaintiff/auction-purchaser was entitled to recover the amount of purchase money deposited by him in the Court. Question arose as to from whom the plaintiff/auction-purchaser could recover the amount. This aspect of the matter is dealt with by the learned trial Judge very briefly in para 15 of his judgment. He observed therein as follows:-

"15. As I have stated above the defendant No.1 took necessary precautions before putting the house for auction and there was no mistake committed by him in it and hence he cannot be held liable to return the amount to the plaintiff, b











































































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