The principle of lis pendens is fully applicable to sales of mortgaged property during the pendency of a writ application challenging the sale.

The petitioners entered into an agreement with the Bihar State Financial Corporation on 14th June, 1985 for a loan of Rs. 7,00000/-which was to be paid in phases. In all, the petitioners, admittedly, have so far been paid Rs. 6.16 lacs. According to the agreement the entire amount advanced to the petitioners by the Corporation had to be repaid along with interest by 30th September, 1994. There was also a stipulation in the agreement that in case of any default in payment of any instalment the Corporation will be free to put the mortgaged property to sale and realize the entire dues including the insta1ments which had to be repaid along with the interest by 30th September, 1994. Admittedly the petitioners paid about Rs, 2.19 lacs towards repayment of Joans but there was default in making payment of some instalments.

2. A notice was published under section 29 of the Act on 22-12-1991 mentioning the names of the concerns which had to be put on auction for non-payment of loan. The petitioners' hotel also figured in that list. That is challenged in this writ application. The matter came for ad mission on 3-1-1992 and the Bench hearing the matter directed the case to be put up again on 10-1-1992 to enable learned counsel for the Corporation to obtain instruction. It also said that till that date the sale as directed by annexure-1 in relation to the petitioner, shall remain stayed on the petitioner's making payment of a sum of rupes one lac to the Corporation by 9-1-1992. The petitioners said that the price of the hotel is not less than Rs 40,00000/- in any manner and that they are prepared to pay the loan. In spite of the aforesaid restrain order passed on 3-1-1992 tenders were opened on 6-1-1992 and the same was accepted on that date. We do not fully appreciate this act when there was an order of restrain. The Corporation should have stayed its hands and should not have proceeded in any manner in the processes of completing the sale. However, it has been stated by the petitioner in the supplementary affidavit that on 8th January, 1992 the petitioners went with rupees one lac in cash to deposit the same with the Corporation but the same was not accepted. This fact has been denied by the Corporation and to give strength to its case it has also been said that tile story of the petitioners that they went with a cash of Rs. one lac to deposit the same is not correct. It is said that they knew it fully that the Corporation does Dot accept the money in cash. The assertion that the Corporation does not accept money in cash is falsified by annexure 4 in the reply filed by the petitioner. Annexure 4 shows that in past the corporation had accepted money in cash. Further we do not understand as to why money in cash should not be accepted by the Corporation. The currency is the valid tender and anyone refusing to accept the same is not justified. We may also mention that to give credibility to the stand taken by the Corporation learned counsel for the Corporation has said that the High Court had directed the petitioners to deposit rupees one lac by way of draft. We do not find any such order. Such false assertion on the part of the Corporation leads us to believe the story of the petitioners that in fact they had gone to deposit rupees one lac as directed by order dated 3-1-1992 but for reasons best known to tile Corporation, the Corporation did not accept the amount and passed an order of sale on 15-1-1992 in favour of respondent no. 4 for Rs. 11,00000/- Respondent no. 4 has also appeared and filed counter affidavit. In the counter-affidavit filed on behalf of the Corporation the assertion in paragraph 13 of the petition that the valuation of the hotel was not less than Rs. 40 lacs has not been denied but a vague denial has been made in paragaph 11 of the counter affidavit filed by the auction purchaser respondent no. 4. In this paragraph he has said that the valuation of the land adjacent to the hotel is about rupees one lac per katha in