Back
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE S.S. SUBRAMANI
A. Kuppusamy Mudaliar
Versus
G. Subramania Mudaliar & Others
C.M.A. No. 994 of 1990 & C.R.P. No. 293 of 1991
Decided On :Decided on : 25-07-1997
AUCTION PURCHASER - SALE PROCLAMATION - IRREGULARITIES - WAIVER - BENAMI PURCHASE - LIMITATION - ORDER 21, RULE 90, C.P.C. - SECTION 47, C.P.C. - SALE SET ASIDE - DELIVERY OF PROPERTY.
Fact of the Case:
Auction purchaser in O.S. 54 of 1975, on the file of Subordinate Judge, Arni, is the appellant as well as revision petitioner. One Annamalai Mudaliar filed a suit for recovery of money against G. Subramania Mudaliar as O.S. 54 of 1975. The suit was based on a bond executed by the respondent G. Subramania Mudaliar. The suit was decreed on 8-9-1975. Pursuant to the decree, the decree-holder filed E.P. 35 of 1976 for recovery of the amount by sale of the properties. The Court fixed the upset price at Rs. 50,000/- and the sale was posted on 15-12-1976. It is seen that notice under order 21, Rule 66, C.P.C. was attempted to be served on the respondent, but was refused to be accepted and, therefore, returned. Court accepted the same as sufficient service and on the day fixed for settlement of proclamation, respondent was not present. The proclamation was settled. The sale was posted to 15-12-1976. A few days before the sale, respondent filed an application as E.A. 112 of 1976. That petition was dismissed. On the date of sale, the auction could not take place since there were no bidders. On 16-12-1976, decree-holder filed an application as E.A. 120 of 1976 to reduce the upset price from Rs. 50,000/- to Rs. 25,000/-. Notice of the same was given to the respondent, who raised serious objections. According to him, the property is worth more than Rs. 2-1/2 lakhs, and the upset price should not be reduced. In view of the objection, the case was posted to 2-2-1977. In the meanwhile, respondent filed an application under Order 21, Rule 56, C.P.C. alleging that the value of the property is more than Rs. 2-1/2 lakhs. There are income-tax arrears to the extent of nearly Rs. 78,000/- and there are also other encumbrances. The Court, after hearing the same, dismissed it. The matter was taken in Revision by the respondent in C.R.P. 1764 of 1977. In the meanwhile, respondent also filed an application under Order 21, Rule 69, C.P.C. to postpone the Court auction. In view of the earlier stay of this court in the Revision, sale was also adjourned. C.R.P. 1764 of 1977 was dismissed and the Court held that the executing Court was justified in reducing the upset price and also held that the so called income-tax arrears cannot be treated as encumbrance, and therefore, it need not be mentioned. The contention of the judgment-debtor that there was an attachment over the property was also stated as unnecessary to be mentioned in the proclamation schedule. The sale came to be posted on 25-1-1978. On that date, the respondent filed E.A. 15 of 1978 under Order 21, Rule 69, C.P.C. to adjourn the sale by six months and also paid a sum of Rs. 250/- in part satisfaction of the decree amount. The sale was adjourned to 8-2-1978. On 8-2-1978 also, respondent filed E.A. 25 of 1978, to have the sale adjourned, on payment of another sum of Rs. 250/-. The Court did not entertain that application and the sale was conducted. The appellant who is the revision petitioner was the successful bidder and he bid the property for Rs. 25,005/-. On that date, the property was already encumbered for a sum of more than Rs. 60,000/-excluding interest, in respect of three mortgages, (1) mortgage in favour of one Madhiazhagan for Rs. 25,000/-, (2) mortgage in favour of Thilagavathi Ammal for Rs. 10,000/- and (3) mortgage in favour of Ideal Finance for a sum of Rs. 25,000/-. The auction purchaser, i.e., the appellant deposited the bid amount in Court and sought for confirmation of sale. On 4-3-1978, the respondent filed an application under Order 21, Rule 90, C.P.C. to set aside the auction sale. As per the provisions of the Code of Civil Procedure, as amended by this Court, security also had to be furnished for entertaining such application. Therefore, the executing Court directed the respondent to furnish security. Though the respondent submitted the same, the same was rejected as insufficient against which the Revision was filed before this Court as C.R.P. No. 3217 of 1978. The Civil Revision Petition was allowed, and the matter was remanded. After remand, respondent filed another application for furnishing additional security which was also dismissed on 25-7-1980. On 5-8-1980, the auction in favour of the appellant was confirmed and the sale certificate was also issued. On the basis of the Sale Certificate, the appellant/petitioner filed application to take delivery of the property. At that time, the respondent filed R.E.A. 143 of 1981 to set aside the auction under Section 47, C.P.C.
Finding of the Court:
The main question to be considered in this case is, whether grounds have been made out for setting aside the sale.
Issues: Whether grounds have been made out for setting aside the sale.
Ratio Decidendi: The judgment debtor had notice of the sale proclamation. Even though Order 21 Rule 66 C.P.C. notice was not served on him personally (the case is that he refused to accept the same), subsequently he himself participated in the proceedings, and after hearing him, the upset price was reduced. There was subsequent settlement of proclamation. The reduction of upset price was challenged in Revision before this Court, but without success. Thereafter, when the property came for sale, with the knowledge of details of the proclamation, respondent applied for adjournment of sale, waiving fresh proclamation. Once he has waived the fresh proclamation, it is implied that he has waived as to any of the defects apparent on the proclamation (Emphasis). The main objection of the respondent is that the various door numbers of the shop buildings are not mentioned. The non-mention of it is an apparent defect, and in view of the waiver, he is precluded from challenging the proclamation once again. There is no gross undervaluation, and the sale has taken place for the proper value, and no evidence was also adduced to show regarding the value of the property on the date of sale. The various irregularities alleged in the petition could be raised only under Order 21, Rule 90, C.P.C. and not under Sec. 47, C.P.C. The application-cum-petitioner is not a purchase on behalf of the decree holder and he has purchased the property with his own funds. The order of the lower court setting aside the sale under Section 47, C.P.C. is illegal and, therefore, it is set aside.
Final Decision: C.M.A. and C.R.P. are allowed. No costs.
1. Auction purchaser in O.S. 54 of 1975, on the file of Subordinate Judge, Arni, is the appellant as well as revision petitioner.
2. One Annamalai Mudaliar filed a suit for recovery of money against G. Subramania Mudaliar as O.S. 54 of 1975. The suit was based on a bond executed by the respondent G. Subramania Mudaliar. The suit was decreed on 8-9-1975. Pursuant to the decree, the decree-holder filed E.P. 35 of 1976 for recovery of the amount by sale of the properties. The Court fixed the upset price at Rs. 50,000/- and the sale was posted on 15-12-1976. It is seen that notice under order 21, Rule 66, C.P.C. was attempted to be served on the respondent, but was refused to be accepted and, therefore, returned. Court accepted the same as sufficient service and on the day fixed for settlement of proclamation, respondent was not present. The proclamation was settled. The sale was posted to 15-12-1976. A few days before the sale, respondent filed an application as E.A. 112 of 1976. That petition was dismissed. On the date of sale, the auction could not take place since there were no bidders. On 16-12-1976, decree-holder filed an application as E.A. 120 of 1976 to reduce the upset price from Rs. 50,000/- to Rs. 25,000/-. Notice of the same was given to the respondent, who raised serious objections. According to him, the property is worth more than Rs. 2-1/2 lakhs, and the upset price should not be reduced. In view of the objection, the case was posted to 2-2-1977. In the meanwhile, respondent filed an application under Order 21, Rule 56, C.P.C. alleging that the value of the property is more than Rs. 2-1/2 lakhs. There are income-tax arrears to the extent of nearly Rs. 78,000/- and there are also other encumbrances. The Court, after hearing the same, dismissed it. The matter was taken in Revision by the respondent in C.R.P. 1764 of 1977. In the meanwhile, respondent also filed an application under Order 21, Rule 69, C.P.C. to postpone the Court auction. In view of the earlier stay of this court in the Revision, sale was also adjourned. C.R.P. 1764 of 1977 was dismissed and the Court held that the executing Court was justified in reducing the upset price and also held that the so called income-tax arrears cannot be treated as encumbrance, and therefore, it need not be mentioned. The contention of the judgment-debtor that there was an attachment over the property was also stated as unnecessary to be mentioned in the proclamation schedule. The sale came to be posted on 25-1-1978. On that date, the respondent filed E.A. 15 of 1978 under Order 21, Rule 69, C.P.C. to adjourn the sale by six months and also paid a sum of Rs. 250/- in part satisfaction of the decree amount. The sale was adjourned to 8-2-1978. On 8-2-1978 also, respondent filed E.A. 25 of 1978, to have the sale adjourned, on payment of another sum of Rs. 250/-. The Court did not entertain that application and the sale was conducted. The appellant who is the revision petitioner was the successful bidder and he bid the property for Rs. 25,005/-. On that date, the property was already encumbered for a sum of more than Rs. 60,000/-excluding interest, in respect of three mortgages, (1) mortgage in favour of one Madhiazhagan for Rs. 25,000/-, (2) mortgage in favour of Thilagavathi Ammal for Rs. 10,000/- and (3) mortgage in favour of Ideal Finance for a sum of Rs. 25,000/-. The auction purchaser, i.e., the appellant deposited the bid amount in Court and sought for confirmation of sale.
3. On 4-3-1978, the respondent filed an application under Order 21, Rule 90, C.P.C. to set aside the auction sale. As per the provisions of the Code of Civil Procedure, as amended by this Court, security also had to be furnished for entertaining such application. Therefore, the executing Court directed the respondent to furnish security. Though the respondent submitted the same, the same was rejected as insufficient against which the Revision was filed before this Court as C.R.P. No. 3217 o
AI
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
