2015 Supreme(HP) 1308
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Mansoor Ahmad Mir, Tarlok Singh Chauhan, JJ.
Rama Kundra - Appellant
Versus
M/s. Esskay Woolen & Spinning Mills and others – Respondent
OSA No. 12 of 2006
Decided on: 3.11.2015
Advocate Appeared:
For the appellant :Mr. Karan Singh Kanwar, Advocate.
For the respondent:Mr. Virender Singh Rathore, Advocate, for respondents No. 1 and 2 (a).
Mr. K.D. Sood, Senior Advocate, with Mr. Mukul Sood, Advocate, for respondent No. 3.
The main legal point established in the judgment is the mandatory requirement of procedural compliance of Order XXI Rule 64 of the Code, which gives the Court the power to deprive a person of their property and requires the Court to decide whether it is necessary to bring the entire property to sale or such portion thereof as may seem necessary to satisfy the decree.
Headnote:
Order XXI Rule 64 CPC - Execution of Decrees - Balakrishnan versus Malaiyandi Konar (2006 AIR SCW 951), Takkaseela Pedda Subba Reddi v. Pujari Padmavathamma (AIR 1977 SC 1789), Ambati Narasayya v. M. Subba Rao and Anr. (1989 Suppl (2) SCC 693), S. Mariyappa (Dead) by L. Rs. and Ors. v. Siddappa and Anr. (2005 (10) SCC 235), S. S. Dayananda v. K. S. Nagesh Rao and Ors. (1997 (4) SCC 451), Desh Bandhu Gupta v. N. L. Anand and Rajinder Singh (1994 (1) SCC 131)
Fact of the Case:
The appeal concerns the setting aside of a sale and dismissal of an Execution Petition. The core question is whether the Executing Court followed the mandate of Order XXI read with the Rules.
Finding of the Court:
The Court found that the Executing Court did not pass an order in accordance with Order XXI Rule 64 CPC, which is mandatory and gives power to the Court to deprive a person of their property. The Court also held that the auction purchaser, despite depositing the money, did not have the right to purchase the property due to the illegal foundation of the exercise.
Issues: The issues involved were whether the Executing Court followed the mandate of Order XXI read with the Rules, and whether the auction purchaser had the right to purchase the property.
Ratio Decidendi: The Court's decision was influenced by the interpretation of Order XXI Rule 64 CPC, as well as the legal principles established in various cases, including the necessity to bring only such portion of the property as is necessary to satisfy the decree, and the mandatory requirement of procedural compliance of Order XXI Rule 64 of the Code.
Final Decision: The impugned judgment and order were upheld, and the appeal was dismissed along with all pending applications. The amount was to be refunded to the auction purchaser/legal representatives of the auction purchaser.
Mansoor Ahmad Mir, Chief Justice.
This appeal is directed against the judgment and order, dated 22.09.2006, made by the learned Single Judge in OMPs No. 201 of 1994 & 189 of 1999 and Execution Petition No. 26 of 1989, whereby and whereunder the sale was set aside and the Execution Petition was dismissed (for short "the impugned judgment").
2. The Decree Holder and the Judgment Debtors have not questioned the impugned judgment, has been questioned by the auction purchaser, namely Smt. Raj Kapoor, who died during the pendency of the appeal and her legal representative has been brought on record, on the ground that she was a bona fide purchaser and no illegality was committed while making the orders under Order XXI Rule 66 of the Code of Civil Procedure, 1908 (for short "CPC") and Order XXI Rule 66 CPC, the impugned judgment be set aside and she be handed over the possession of the property, the subject matter of the appeal.
3. The core question involved in this appeal is whether the Executing Court, while determining the Execution Petition, has followed the mandate of Order XXI read with the Rules?
4. In order to determine the issue and return the findings, it is necessary to give a brief resume of the case, the womb of which has given birth to the instant appeal.
5. Civil Suit No. 10 of 1980, titled as State Bank of India versus M/s. Esskay Woolen & Spinning Mills (P) Ltd. and another, was filed in the year 1980, which was decided in exparte vide judgment and decree, dated 30.04.1981. The Execution Petition was filed by the Decree Holder and notice was issued to the Judgment Debtors for satisfying the decree, failed to do so and execution was sought by attachment and sale of land measuring 442 Kanals 7 Marlas, situated at Mehal Beli, Mauja Satana, District Kangra, which was owned by original defendant No. 2/Judgment Debtor No. 2. Attachment order was made on 09.05.1991, constraining the Decree Holder to lay an application for sale of the attached property and for proclamation in terms of Order XXI Rule 66 CPC, which was diarized as OMP No. 428 of 1991. During the pendency of the said application, the Judgment Debtors filed an application for setting aside the exparte decree and execution of the decree was stayed. The said application was dismissed and the stay order was vacated. On 15.03.1994, orders qua warrant of sale were made by the Registrar.
6. While going through the file, one comes to an inescapable conclusion that no order was passed by the Executing Court in terms of Order XXI Rule 64 CPC, which reads as under:
"ORDER XXI
EXECUTION OF DECREES AND
ORDERS
............
64. Power to order property attached to be sold and proceeds to be paid to person entitled. Any Court executing a decree may order that any property attached by it and liable to sale, or such portion thereof as may seem necessary to satisfy the decree, shall be sold, and that the proceeds of such sale, or a sufficient portion thereof, shall be paid to the party entitled under the decree to receive the same."
7. The mandate of law, reproduced above, is to pass an order to record satisfaction as to whether the portion of the attached property or the entire attached property is to be put to sale in order to satisfy the decree. It is not just a formality, but is mandatory, because the said mandate of law gives power to the Court to deprive a person from his property, that is why the Court had to record its satisfaction.
8. Our this view is fortified by the Apex Court judgment in the case titled as Balakrishnan versus Malaiyandi Konar, reported in 2006 AIR SCW 951. It is apt to reproduce paras 10 and 11 of the judgment herein:
"10. The provision contains some significant words. They are "necessary to satisfy the decree". Use of the said expression clearly indicates the legislative intent that no sale can be allowed beyond the decretal amount mentioned in the sale proclamation. (See Takkaseela Pedda Subba Reddi v. Pujari Padmavathamma (AIR 1977 SC 1789). In al