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1946 Supreme(Nagpur) 105
HIGH COURT OF NAGPUR
Bose
RAJARAM KONTU – Appellant
Versus
RISHABHA KUMAR S/O MOHANLAL – Respondent
Decided on : 19-12-1946
The court emphasized the importance of specific rules in confirming auction-sales and clarified the applicability of Section 11, C.P. Money-lenders Act after the final decree.
Headnote:
Debt Relief Act - Auction-Sale - Section 6(3), Debt Relief Act - Summary: The court discussed the effect of a notice issued under Section 6(3), Debt Relief Act on an auction-sale. It held that the sale was valid as the notice did not reach the civil Court before the sale, and thus the civil Court was not given notice of the stay. The court also emphasized that once a sale has taken place, it must be confirmed unless it can be set aside under specific rules.
Fact of the Case:
The judgment-debtor applied for setting aside an auction-sale and for instalments under Section 11, C.P. Money-lenders Act. The sale was confirmed, and the judgment-debtor sought to nullify it based on a notice issued under the Debt Relief Act.
Finding of the Court:
The court found that the sale was valid as the notice did not reach the civil Court before the sale, and emphasized that once a sale has taken place, it must be confirmed unless it can be set aside under specific rules. Additionally, the court held that Section 11, C.P. Money-lenders Act has no application after the stage of the final decree.
Issues: Validity of auction-sale in light of notice issued under Debt Relief Act, Applicability of Section 11, C.P. Money-lenders Act after the final decree.
Ratio Decidendi: The court emphasized that the sale was valid as the notice did not reach the civil Court before the sale, and once a sale has taken place, it must be confirmed unless it can be set aside under specific rules. Additionally, the court held that Section 11, C.P. Money-lenders Act has no application after the stage of the final decree.
Final Decision: The appeal was dismissed with costs.
Bose, J—We are concerned here with two applications made by the judgment-debtor (appellant) in the first Court, (1) for setting aside an auction-sale under , Civil P.C., and (2) for instalments under Section 11, C.P. Money-lenders Act.
2. The facts are as follows. The decree-holder (respondent) obtained a final decree for sale on 16-8-1938 for Rs. 15,880-10-0. The sale was held on 16-1-1940 and realised Rs. 12,500-0-0, It was confirmed on 16-2-1942.
On 14-12-1939, that is to say, after the final decree and before the sale, the judgment-debtor applied to the Debt Relief Court and on 15-1-1940, the Debt Relief Court issued a notice under Section 6(8), Debt Relief Act for stay. This notice was not received by the civil Court before the sale was held. The exact date on which it reached the civil Court is not clear from the record. The earliest endorsement by the civil Court on the notice is dated 25-1-1940. But whatever the exact date is it is evident that it was not received by the civil Court on or before 16-1-1940, the date on which the sale was held. The question then arises what was the effect of that notice on the sale. The earned Counsel for the judgment-debtor (appellant) contends that it has the effect of nullifying the sale, and he relies on Krishna Dewaji v. MIthmal Lakhmichand and Zibal Iswara v. Muka
3. In my opinion, neither of these rulings has application here, and, in my judgment, the sale was good. So far as the two rulings are concerned, they relate to cases in which the civil Court received notice of stay from the Debt Relief Court before the holding of the sale; for example, in Krishna Dewaji v. Mithmal Lakhmichand the notice was received by the civil Court on 8 3-1940, while the sale did not take place till 28-3-1940. The same was the case in the other decision. The notice was received by the civil Court before the sale. Those cases, therefore, have no application to the present where the sale ipdk place before the notice was received by the civil Coterie.
4. Section 6(3), Debt Relief Act, which is the one which concerns us here, is in these terms:
When an application made under Sub-section (1) is admitted, and when notice of such admission is given io the Courts concerned, proceedings; if any, against the debtor...pending before a civil Court...shall be stayed.
5. The important part of the section is the portion which I have underlined (here italicized). The word there is that the stay is to operate from the date on which notice is given to the Courts. Notice cannot be said to be given until it is actually handed over. The meaning of the Act in my judgment is that the stay is not to operate until the Courts receive the notice. It is not enough to sign an order in the Debt Relief Court. That is not giving. That is only making an order., The act of giving imports delivery of the object given. Accordingly, as the notice did not reach the civil Court before the sale, it cannot be said that the civil Court was given notice of the stay. As the stay only operates from the date on which notice is given to the civil Courts, it is clear that the sale proceedings were valid on 16-1-1940 when the sale was held. Accordingly, the sale must and, and its confirmation on 16-2-1942 was good.
6. I say that the confirmation on 16-2-1942 was good because their Lordships of the Privy Council have held that once a sale has taken place then it must be confirmed unless it can be Bet aside under Order 21, Rule 89, 90 or 91, Civil P.C. If the matter cannot be brought under any of those rules then the sale cannot be set aside. The same principle applies in this case. The sale was good. The matter cannot be brought under Order 21, Rule 89, 90 or 91. Therefore, the confirmation also was good: Akbar Ali v. Sobharam Motiram,1939 AIR(Nag) 282.
7. The next question relates to the application for instalments under Section 11, C.P. Money-lenders Act. The question there is whether Section 11 applies after the stage of final decree. Reliance was
