1985 Supreme(Ker) 368
Judges : VARGHESE KALLIATH
RUGMINI AMMA - Appellant
Versus
ABDULLA - Respondent
Case No : S.A. No. 825 of 1979
Decided On : 12/20/1985
Advocates Appeared :
S. Narayanan Poti; For Appellant T.R. Govinda Warrier; For Respondent
Headnote:
Whether a bona fide purchaser for value from a decree-holder auction purchaser can validly resist the claim for restitution by the judgment debtor when the decree on the basis of which sale was effected is subsequently set aside and the general question whether the assignee of the decree holder court auction purchaser will be affected by the subsequent reversal of the decree.
Fact of the Case:
The plaintiff, a lessee of a decree-holder auction purchaser, filed a suit for recovery of possession of the suit property from the defendant, the judgment debtor. The defendant contended that the plaintiff was not entitled to possession as he was dispossessed long before the Act came into force and he was not a tenant on the date of the suit. The plaintiff argued that he was a bona fide purchaser for value from a decree-holder auction purchaser and was entitled to the same protection as that of a stranger auction purchaser in a court sale.
Finding of the Court:
The court held that a bona fide purchaser for value from a decree-holder auction purchaser has got the same protection as that of a stranger auction purchaser in the matter of restitution by the judgment debtor of the property in specie. The court further held that the title conveyed to a decree holder auction purchaser and stranger auction purchaser in a judicial sale is one and the same. However, there is a marked difference in law between these two classes of persons in the matter of restitution. The court also held that the principle of restitution is that on the reversal of a decree, the law imposes an obligation on the party to the suit who received the benefit of the erroneous decree to make restitution to the other party for what he has lost and the Court in making restitution is bound to restore the parties so far as they can be restored to the same position they were in at the time when the Court by its erroneous action had displaced them.
Issues: 1. Whether the courts below were right in giving a decree to the plaintiff, when, on their own finding be was dispossessed as early as 5-4-1966 long before Act 1 of 1964 came into force and he was not a tenant on 1-1-1970. 2. Whether a suit for recovery of possession on title is maintainable at the instance of the plaintiff after his application for redelivery under S. ISA of Act 1 of 1964 has been dismissed. 3. Whether the plaintiff who claims to be inducted into possession as a lessee during the pendency of the suit, OS.No. 397 of 1941 can resist re-delivery of possession when the decree itself was set aside and redelivery was ordered in EP. 29/59?
Ratio Decidendi: The court relied on the principle of restitution and held that the plaintiff, as a bona fide purchaser for value from a decree-holder auction purchaser, was entitled to the same protection as that of a stranger auction purchaser in a court sale. The court also held that the title conveyed to a decree holder auction purchaser and stranger auction purchaser in a judicial sale is one and the same. However, there is a marked difference in law between these two classes of persons in the matter of restitution.
Final Decision: The court dismissed the appeal and upheld the judgment of the lower courts.
This is an appeal by the second defendant in the suit. At the time of admission, notice was issued on the following questions of law.
1. Whether the courts below were right in giving a decree to the plaintiff, when, on their own finding be was dispossessed as early as 5-4-1966 long before Act 1 of 1964 came into force and he was not a tenant on 1-1-1970.
2. Whether a suit for recovery of possession on title is maintainable at the instance of the plaintiff after his application for redelivery under S. ISA of Act 1 of 1964 has been dismissed.
3. Whether the plaintiff who claims to be inducted into possession as a lessee during the pendency of the suit, OS.No. 397 of 1941 can resist re-delivery of possession when the decree itself was set aside and redelivery was ordered in EP. 29/59? 2. The learned counsel for the appellant did not advance any argument on the above questions. The main question of law he raised and argued is whether a lessee of a decree-holder auction purchaser can validly resist the claim for restitution by the judgment debtor when the decree on the basis of which sale was effected is subsequently set aside and the general question whether the assignee of the decree holder court auction purchaser will be affected by the subsequent reversal of the decree. The further question which has arisen in the case is that, in view of the judgment in S. A. No. 482 of 1973 by this court, which remanded the case to the trial court for permitting the plaintiff to amend the plaint as indicated in the judgment and then to dispose of the suit in accordance with law and in the light of the findings and observations in the judgment, whether the appellant can now validly contend that the assignee (lessee) from the decree holder auction purchaser is not entitled to the same protection as that of a stranger purchaser in a judicial sale. I may now at once say that Viswanatha Iyer, J. held in his judgment in S.A. No. 482 of 1973 remanding the case that an assignee from a decree holder auction purchaser is entitled to the same protection as that of a stranger auction purchaser in a court sale.
3. Though the questions of law argued before me were not raised at the time of admission, I allowed the counsel to argue the questions raised by him considering the fact that those questions are really questions that can be canvassed in the appeal. To answer the question now raised by the learned counsel, I feel that I should examine first the distinctive nature of a judicial sale. The fundamental fact in a judicial sale is that it is a sale effected under the process of a court having competent power to order it, by a person legally appointed and commissioned to sell, which is subject to confirmation by the court. If we examine the nature of that sale, the first and foremost fact that has to be noted significantly is that it is an involuntary sale made by the court wherein the court is acting as the vendor through an agent (officer of the court) conducting the sale.
4. It is axiomatic that in the absence of statutory restrictions courts are inherently-vested with the broad discretionary powers with respect, to the method and mode of judicial sales, but the legality and the validity of a particular sale depends on the court's power to order sale in that case and in jurisdiction over the subject-matter and the parties. As I said that it is an involuntary sale, the object of which is to procure an amount which is approximately the value of the property in question. In my view, such a sale is a contract in that it is the result of an offer on one part, and its acceptance on the other and there is nothing wrong in considering that the court ordering the sale as the contracting party on the one side and the bidder on the other. It is plain that the distinctive character of a judicial sale is that it is the end result of a judicial proceeding. it must have the backing and support of a judicial order, decree or judgment directing that the property