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1998 Supreme(MP) 75

High Court Of Madhya Pradesh
R. S. GARG
PRAKASH CHAND RAI - Appellant
Versus
STATE BANK OF INDORE, BHOPAL - Respondents
M. A. 328 Of 1997
Decided On : 01/29/1998

Advocates Appeared:
B.M.Dwivedi, VAZID HYDER

A sale conducted in violation of mandatory provisions of law, such as Rules 84 and 85 of Order 21 of the Code of Civil Procedure, 1908, is void and cannot be protected by the limitation period prescribed under Article 127 of the Limitation Act, 1963.

Headnote:

AUCTION SALE - IRREGULARITIES - NON-COMPLIANCE WITH RULES 84 AND 85 OF ORDER 21 - SALE VOID - LIMITATION - ARTICLE 127 OF LIMITATION ACT - VOID SALE NOT PROTECTED BY LIMITATION - COURT DUTY TO SET ASIDE VOID SALE - ORDER CONFIRMING VOID SALE QUASHED - SALE SET ASIDE - AMOUNT DEPOSITED BY AUCTION PURCHASER REFUNDED.

Fact of the Case:

Judgment debtor challenged the order confirming the auction sale on the ground of non-compliance with Rules 84 and 85 of Order 21 of the Code of Civil Procedure, 1908.

Finding of the Court:

1. Non-compliance with Rules 84 and 85 of Order 21 renders the sale void. 2. A void sale cannot be protected by the limitation period prescribed under Article 127 of the Limitation Act, 1963. 3. It is the duty of the court to set aside a void sale. 4. The order confirming the void sale was quashed, and the sale was set aside.

Issues: 1. Whether the auction sale was void due to non-compliance with Rules 84 and 85 of Order 21 of the Code of Civil Procedure, 1908? 2. Whether the limitation period prescribed under Article 127 of the Limitation Act, 1963, applies to a void sale? 3. Whether the court has a duty to set aside a void sale?

Ratio Decidendi: 1. Rules 84 and 85 of Order 21 of the Code of Civil Procedure, 1908, are mandatory provisions, and non-compliance with these rules renders the sale void. 2. A void sale is a nullity and cannot be protected by the limitation period prescribed under Article 127 of the Limitation Act, 1963. 3. It is the duty of the court to set aside a void sale, even if it is not challenged by any party.

Final Decision: The appeal was allowed, the order confirming the void sale was quashed, and the sale was set aside. The amount deposited by the auction purchaser was ordered to be refunded.

R. S. GARG, J.

( 1 ) JUDGMENT by this appeal under Order 43, Rule 1 (3) of the Code of Civil Procedure, the petitioners challenge the order dated 20-12-1996 passed by the First Addl. District Judge, Raisen, in execution case No. 9-B/91.

( 2 ) BRIEF facts for proper disposal of the case are that the decree-holder obtained a decree for recovery of money against the judgment-debtor. In execution, certain properties already mortgaged with the decree-holder were proposed to be put to auction. Certain objections were filed by the judgment-debtor on 25-1-1993 and 1-3-1993. It appears that the objections were many fold but the relief claimed was that the auction be stayed till compromise is effected between the parties. The applications were listed for argument. The said applications, though not specifically but tacitly were deemed to be disposed of under the order dated 18-11-1992 and 25-1-1994. The judgment-debtors again moved an application under Order 21, Rule 66, C. P. C. The trial Court (executing Court) did not pass any orders on this application. On 27-1-1994, the Court ordered that notice of the application be issued to the decree-holder. The case was adjourned to 7-2-1994. On 7-2-1994, an application was again filed by the judgment-debtors raising various objections, including the objection under Order 21, Rule 24 and Rule 66. The application was supported with an affidavit. Reply to application dated 7-2-1994 was filed on10-7-1994. On 10-2-1994 itself, an application under Order 21, Rules 26, 29, 59, 66 (1) (2) and Rule 69 was filed. On 16-2-1994, yet another application under Order 21, Rules 26, 29, 66 (1) (2) was filed. The applications were properly replied. It is to be noted that the Court had already fixed 9-2-1994 as the date for auction on the spot and 10-2-1994 for submission of report. The matter was taken up for hearing on 11-2-1994. The applications which were filed before 11-2-1994 and filed after 10-2-1994 were not decided by the Court. It is also to be seen from the records that on 9-2-1994, the auction purchaser did not deposit 25 per cent of the bid amount on the spot immediately. Within the next 15 days, he did not deposit the balance of 75 per cent of the bid as required to be deposited under Rule 85 of Order 21. Objections filed by the judgment-debtors were heard on 5-1-1995. The executing Court by its order dated 5-1-1995 rejected the objections holding that as the sale had already been effected and to that effect report from the Nazir had also been received, the objections have become infructuous. In the opinion of this Court, the said approach was patently illegal. When the objections were raised prior to the sale itself, those were required to be decided before effecting the sale or in any case could not be rejected as infructuous. No Court has been given authority under the law to create a situation where legal rights of the litigants are adversely affected because it is expected of the Court that by its act/acts, it would not cause prejudice or loss to any body. After 5-1-1995, certain objections were again filed by the judgment-debtors on 21-4-1995. Replies, etc. were filed to the said objections. The executing Court by its order dated 3-9-1996 rejected the judgment-debtors' application dated 21-4-95, holding that under the provisions of Rule 90 of Order 21, an auction sale can be set aside on the ground of irregularities or fraud but as substantial irregularities or fraud was not found in the case, the sale could not be set aside. The Court being aware of the fact that till by that time the auction purchaser had not deposited the amount in compliance of Rule 84 or Rule 85, directed that notice be issued to the auction purchaser. On 7-10-1996, an objection under Order 21, Rule 84 was again filed bringing to the notice of the Court that the auction purchaser did not comply with the provisions of Rule 84 and/or Rule 85, therefore, in view of non-compliance of the mandatory provisions of law, material













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