IN THE HIGH COURT OF MADRAS
Stodart, J.
Natesa Pillai and Ors.
Versus
Venkatarama Aiyar and Anr.
Decided On : 11.10.1939
Court Sale - Order 21, Rule 90 - 21(2) - The judgment-debtors applied to set aside a Court sale of their property on the ground of irregularity, illegality, and fraud. The Court held that the price fetched at the sale was not unduly low and there was no material irregularity or illegality. However, the sale was deemed vitiated by illegality due to the irregularities in the auction process, making the sale a nullity.
Fact of the Case:
The appellants, as judgment-debtors, applied to set aside a Court sale of their property, alleging irregularity, illegality, and fraud in the auction process.
Finding of the Court:
The Court found that the price fetched at the sale was not unduly low and there was no material irregularity or illegality. However, the sale was deemed vitiated by illegality due to irregularities in the auction process.
Issues: 1. Whether the price fetched at the sale resulted in substantial loss to the judgment-debtors? 2. Whether the loss was due to material irregularity or fraud in publishing or conducting the sale? 3. Whether the sale was vitiated by illegality?
Ratio Decidendi: The Court held that the sale was vitiated by illegality due to irregularities in the auction process, making the sale a nullity.
Final Decision: The appeal was allowed, and the Court set aside the sale with costs both in the appellate and lower Court.
Stodart, J.
1. The appellants are the judgment-debtors. They applied to the Court below under Order 21, Rule 90 to set aside a Court sale of their property held on 12th August, 1935, on the ground that there was irregularity in publishing and. conducting it, which resulted in the property being sold for a price much below its real value. The objections of the appellants were not stated with any degree of clarity in their application to the lower Court but in the course of the hearing it was urged that the sale was also vitiated by illegality. For the Court at the beginning of its judgment states that:
It is urged inter alia that there has been material irregularity and illegality and fraud in the publication and conduct of the sale.
2. The Court held that the price fetched at the sale was not unduly low, that there was no material irregularity or illegality in publishing or conducting it and that the price fetched at the sale even if considered to be low was not the result of the alleged irregularities or illegalities. Hence this appeal. The contesting respondents here are the decree-holder, and the purchaser at Court auction who opposed the petition in the lower Court. The latter is the decree-holders father.
3. The questions we have to decide are:
1. Was the price fetched at the sale unduly low so that it can be said to have resulted in substantial loss to the judgment-debtors?
2. If so was that loss due to material irregularity or fraud in publishing or conducting the sale?
3. Was the sale vitiated by illegality?
* * * * *
[After considering the circumstances whether the price was so low as to result in substantial loss to the judgment-debtors and finding against that objection their Lordships proceeded as follows.]
4. In the light of all these circumstances we agree with the learned Sub-Judge that judgment-debtors have not shown that they suffered any substantial injury by reason of the price fetched at the sale. And in this view of the case it is not necessary for us to decide the second question which arises in this appeal, namely, whether the learned Sub-Judge was wrong in holding that there was no irregularity or fraud in publishing or conducting the sale. We proceed therefore to the third point. Was the learned Sub-Judge wrong in holding that the sale was not vitiated by illegality? On this point we think the appellants are entitled to succeed. For reasons which we shall presently state we think the sale was vitiated by illegality. And in such a case the sale must be deemed to be altogether void. In order to set aside a sale on the ground of illegality it is not necessary for the Court to hold that the judgment-debtor has been materially prejudiced by the sale. For the sale itself is a nullity. In this particular case we are compelled to hold that the sale was held on a day which was not a day on which it had been advertised to take place or a day to which it had been adjourned. The sale was originally posted to 8th July, 1935. It was adjourned to the 9th; then to the 10th and then to the 11th, the order of the Court being taken for every adjournment. Then on the 11th it was ordered to be continued from day to day till the 26th and it was further directed that the sale would be on the 26th. This was in our opinion an irregularity. It would not have been irregular if the Court had directed that the sale should be adjourned from day to day till satisfactory bids were forthcoming and that these de die in diem adjournments should not continue after the 26th. But for the Court to order on the 11th that the sale should not be concluded till the 26th amounted to an adjournment of the sale for 15 days. And Order 21, Rule 69(2) as it then existed laid down the rule that a sale should not be adjourned for a longer period than 7 days without a fresh proclamation unless the judgment-debtor consents to waive it. And there is no indication here that the judgment-debtor did so consent. However it is not this irregularity which forms t
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