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2015 Supreme(Mad) 2586

IN THE MADURAI BENCH OF MADRAS HIGH COURT
V.M.VELUMANI, J.
R.Viswanathan - Appellant
Vs.
R.Santhanam and Ors. – Respondents
C.M.A.(MD)No.510 of 2010 & M.P.(MD) Nos.1 of 2010 & 1 of 2015
Decided On : 31.07.2015

Advocates:
Advocate Appeared:
For Appellant : Mr.M.V.Venkatasesan
For Respondent: Ms. J. Maria Roseline, Mrs. Hema Sampath Senior Counsel for Mr. J. Parekh Kumar

The appellant must prove irregularity or fraud in conducting the auction sale and that he suffered substantial injury to set aside a court auction sale under Order 21 Rule 90 C.P.C.

Headnote:

Court Auction Sale - Irregularity in Conducting Sale - Order 21 Rule 54, 66, 67 C.P.C. - The court dismissed the petition to set aside the sale, finding that the appellant failed to prove irregularity or fraud in conducting the auction sale and that he suffered substantial injury. The court held that the appellant's contentions regarding the upset price and notice served were untenable, and the judge had complied with the provisions of Order 21 C.P.C. The civil miscellaneous appeal was dismissed.

Fact of the Case:

The appellant filed a petition to set aside the sale held on 26.10.2005, alleging irregularity and fraud in the court auction sale. The appellant contended that the upset price was high, no notice was served, and the auction was conducted without following the procedure laid down in Order 21 Rules 54, 66, and 67 C.P.C.

Finding of the Court:

The court found that the appellant failed to prove irregularity or fraud in conducting the auction sale and that he suffered substantial injury. The court held that the appellant's contentions regarding the upset price and notice served were untenable, and the judge had complied with the provisions of Order 21 C.P.C.

Issues: The issues included the value of the property, the upset price, and the notice served for the auction.

Ratio Decidendi: The court held that the appellant's contentions regarding the upset price and notice served were untenable, and the judge had complied with the provisions of Order 21 C.P.C.

Final Decision: The civil miscellaneous appeal was dismissed.

JUDGMENT :

The appellant is the Judgment Debtor in O.S.No.5 of 2002 and respondent in E.P.No.15 of 2004. He filed a petition in E.A.No.23 of 2005, to set aside the sale held on 26.10.2005, in respect of the suit schedule property and to declare the sale as null and void. By the order, dated 25.09.2009, the said application was dismissed by the learned Additional District and Sessions Judge (Fast Track Court No.I), Trichy. Against the said order, the present appeal is filed.

2. The first respondent is the Decree Holder/Petitioner in the E.P. The second respondent is the third party auction purchaser.

3. The case of the Appellant:

(i) The first respondent filed a suit in O.S.No.5 of 2002 on the file of Additional District and Sessions Court (Fast Track Court No.I), Trichy, for recovery of money based on the mortgage. By consent, a preliminary decree was passed and a final decree was passed on 23.12.2003, in I.A.No.67 of 2003. The first respondent filed E.P.No.15 of 2004. The appellant filed various applications in the E.P., at various stages. All the applications were dismissed after contest. The suit property was sold by public auction on 26.10.2005. The appellant filed E.A.No.23 of 2005, to set aside the Court auction sale held on 26.10.2005.

(ii) The first respondent obtained a consent decree by fraud. Therefore, he filed E.A.No.4 of 2005 under Order 21 Rule 58 C.P.C. The said application was dismissed. The Court directed the Senior Bailiff to value the property on 29.03.2004. The Senior Bailiff without inspecting the suit property and enquiring the witness, has arrived at value of property at Rs.11,50,000/-. As per the guideline value, the value of vacant site comes to Rs.15,79,200/-and the value of the building comes around Rs.11,50,000/-. According to the appellant, the value of the suit schedule property is not less than Rs. 35,00,000/-.

(iii) The appellant filed a petition to enhance the upset price of the schedule mentioned property. The said petition was dismissed. The appellant filed E.A.No.12 of 2005, for adjournment of sale. The said petition was also dismissed. At the same time, the auction was adjourned to 22.06.2005 with same proclamation.

(iv) Again, the appellant filed E.A.No.15 of 2005, for adjournment of sale and the said application was also dismissed. On the date of auction, there were no bidders. On 06.09.2005, E.A.No.4 of 2005 was dismissed. The appellant filed petition for stay of all further proceedings to enable him to file a revision before this Court. The Court directed the appellant to pay a sum of Rs.10,000/-to the first respondent, as cost, on or before 21.09.2005. The first respondent refused to receive the said amount. Therefore, the learned Judge directed the appellant to deposit the same into Court and granted stay for two weeks.

(v) As per Order 21 Rule 69 C.P.C., when the sale is stayed by the Court for whatever reason, fresh sale proclamation and fresh date of sale has to be fixed, when the stay was vacated. This condition was violated, as the first respondent failed to issue fresh sale proclamation on the fresh date of sale i.e., on 26.10.2005. The first respondent fraudulently failed to comply the mandatory provision, which amounts to irregularity in publishing and conducting the sale.

(vi) The first respondent filed a Memo on 19.09.2005, stating that the upset price was high and there were no bidders on the date of auction i.e., on 14.09.2005 and prayed for fresh sale on the same upset price to avoid further delay. The first respondent did not serve copy of the Memo to the appellant's counsel.

(vii) The appellant filed E.A.No.21 of 2005 to revise the upset price and another petition to appoint an Advocate Commissioner, to value the suit property with the help of Chartered Engineer and file a report in E.A.No.20 of 2005. The appellant and the first respondent had entered into an agreement of sale on 04.05.1996, by which, the first respondent has agreed to purchase the suit schedule propert

































































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