HIGH COURT OF BOMBAY
BAVDEKAR, DIXIT, JJ.
Santimmappa, Venkappa Konnur
Versus
Balbhim Co-operative Credit Society of Hebsur
Second Appeal No. 935 of 1946, D/- 6 -9 -1949., reference by Shah, J.
Decided On : 06-09-1949
Co-operative Credit Society - Co-operative Societies Act - 1929 - Rs. 576-13-3 - O. 21, R. 93 - Implied warranty of saleable interest - Refund of purchase money - No warranty of title in execution sales - No independent right of action under the Code of 1908 - No right of suit other than for money had and received - S. 65, Contract Act - Misrepresentation and mistake - No right of suit without total failure of consideration - No right of suit under the present Code - No right of suit without setting aside the sale - No right of suit under S. 65, Contract Act - Different principle in case of valid decree and authorized sale
Fact of the Case:
The respondent Co-operative Credit Society obtained an award in 1929 for Rs. 576-13-3 against Basawwa under the Co-operative Societies Act. The property in suit was sold in execution of that award. The auction purchaser filed a suit against the respondent for refund of the purchase money on the ground that Basawwa had no saleable interest in the property brought to sale.
Finding of the Court:
The court found that there was no warranty of title in execution sales and no independent right of action under the Code of 1908. The court held that the auction purchaser had no right of suit other than for money had and received. It was also found that there was no right of suit without total failure of consideration and no right of suit under the present Code without setting aside the sale. The court also noted a different principle in case of a valid decree and authorized sale.
Issues: The issues involved the implied warranty of saleable interest, the right of refund of purchase money, the existence of a warranty of title in execution sales, and the applicability of S. 65 of the Contract Act.
Ratio Decidendi: The court held that there was no warranty of title in execution sales and no independent right of action under the Code of 1908. It was also established that there was no right of suit other than for money had and received, and no right of suit without total failure of consideration. The court further clarified that there was no right of suit under the present Code without setting aside the sale, and no right of suit under S. 65 of the Contract Act. The court also highlighted a different principle in case of a valid decree and authorized sale.
Final Decision: The appeal was dismissed with costs.
BAVDEKAR, J. :- The respondent Co-operative Credit Society had obtained an award in 1929 for Rs. 576-13-3 against one Basawwa under the Co-operative Societies Act. The property in suit was sold in execution 6f that award on 16th February 1934. It appears that prior to this sale the property in suit had already been attached by another Creditor and the sale price was distributed between the respondent Co-operative Credit Society and the other creditor, but there has been a compromise subsequently between the latter and the auction purchaser of the property and we will not be concerned with him, therefore, in the present appeal. The respondent Co-operative Credit Society refused to compromise the matter and consequently the suit has come to this Court. The reason why the auction purchaser was required to file a suit is that on 15th February 1934, one person claiming to be the adopted son of Basawwa adopted on 29th January 1930, sued the auction purchaser after he had been put into possession of the property and dispossessed him in execution of a decree obtained in that suit. The auction purchaser thereupon filed this suit against the original judgment-creditor the respondent Cooperative Credit Society, for refund of the purchase money on the ground that even though he purchased at the execution sale the right, title and interest of the judgment-debtor, it had subsequently turned out that Basawwa had no saleable interest in the property brought to sale. The auction purchaser who is the appellant in the present appeal has failed so far and he has consequently filed this second appeal to this Court, contending that inasmuch as it has been found that the adopted son was entitled to the property and Basawwa had no saleable interest in the property, his suit should have been decreed. This appeal has now been referred to us because of two decisions of this Court (i) in Rustomji Ardeshir v. Vinayak Gangadhar, 35 Bom 29 : (7 IC 955) and (2) is Balvant Raghunath v. Bala, 46 Bom 833 : (AIR (9) 1922 Bom 205). The former was a case under the old Code of 1882 and it was held in that case that a court purchaser who had discovered that the judgment-debtors had no saleable interest in the property sold was entitled to maintain a suit for refund of the purchase money, inasmuch as there was an implied warranty of some saleable interest in the judgment-debtor when the property was put up for sale. The Code of Civil Procedure recognized the right of the purchaser upon some implied warranty to return of the purchase money which had been received by the judgment-creditor. The relationship between the judgment-creditor and the court sale purchaser was, therefore, in the nature of a contract. In the latter case which was a case under the Code of 1908 an auction purchaser sued in similar circumstances for refund of the purchase money, and ill was held that before a person who had purchased property at a court sale can obtain the right to ask for a refund of the purchase money, he must get the court sale set aside under the provisions of O. 21, R. 93. The provisions case of this Court in Rustomji Ardashir v. Vinayak Gangadhar, (35 Bom 29 : 7 PC 955) was referred to but was distinguished on the ground that the case was under the old Code and the language of O. 21, R. 93, which corresponded to S. 315 of the old Code, was different from the language of the latter.
1-a. It was because it was felt that there was some conflict between these two oases that the matter has been referred to a Division Bench of this Court, and in case of a conflict between two cases of a Division Bench of this Court it would undoubtedly be necessary, unless we are prepared to say that either the one or the other is wrong, to refer the matter to a Full Bench. But when we examine the two cases it is obvious that as a matter of fact there is no such conflict as would require that the matter should be referred to a Full Bench. The case of Rustomji Ardeshir v. Vinayak Gangadhar (
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