1933 Present : Garvin S.P. and Drieberg J.

SILVA v. CARUPPEN CHETTIAR.

159-D. C (Inty.) Kandy, 39,945.

Fiscal's sale-Application to set aside-Hypothecary decree and order of credit- Payment of one-fourth deposit-Obligation of decree-holder-Civil Procedure Code, ss. 260 and 272.

A decree-holder, in whose favour an order for credit is made in terms of section 272 of the Civil Procedure Code, is not bound to deposit twenty-five per centum of the purchase money under section 260 of the Civil Procedure Code, in the event of his becoming the purchaser of the property sold in execution.

THIS was an application to set aside a sale held in execution of a hypothecary decree. The decree-holder, in whose favour an order for credit to the extent of his claim was made, was represented at the sale by an agent, who bid a sum of Rs. 3,950 for the property. The Fiscal's

Officer then inquired from the agent whether he was prepared to deposit one - fourth of the purchase money and poundage, whereupon the latter stated that he had brought no money for the purpose. The Fiscal's Officer then intimated to him that he was not prepared to accept any bid from him and the property was knocked down to another for Rs. 4,000. The decree-holder moved to set aside the sale on the ground that the action of the Fiscal's Officer amounted an irregularity, and that as a result the property did not fetch an adequate price. The learned District Judge set aside the sale.

H. V. Perera for purchaser-appellant.-The point is not covered by authority. The Indian Code makes provision for cases where a deposit may be waived. The conditions of sale are unambiguous. The sale is to be governed by. the Civil Procedure Code. A deposit is required of one-fourth in the nature of a security which is forfeited if the sale is not completed. A plaintiff purchaser is not exempt from the liability to make the deposit. A distinction must be drawn between a payment of the purchase price and the liability to pay a sum of money as earnest. If plaintiff's bid is within his claim there is a payment by him at once of the full amount. There is no postponement of the payment of the three-fourth. A purchaser at a Fiscal's sale enters into an agreement to buy. That is why he pays a deposit. If the plaintiff buys within his claim the purchase is at once complete. There is no postponement of the completion of the sale.

[ GARVIN S.P.J.-Credit is the credit available against the amount of the bid.]

One is not then applying the provisions of section 262 of the Code. The Mortgage Ordinance makes all these sections applicable. A fund is required for the satisfaction of the Fiscal, if nothing else. In India there is the addition of certain words to the section. Order 21, Rule 84-Subsection (1) is almost indentical with section 260 of our Code. The addition of sub-section (2) exempts a decree-holder from making a deposit. (Sarkar 6th. ed. 1299; O 'Kinealy 330). Section 260 is an imperative provision and is not taken away by credit being given under section 272.

Hayley, K.C. (with him Weerasooria), for plaintiff-respondent.-Credit is required only for the purpose of the deposit. Credit and debit of the purchase price is done by the Court under section 272. The Indian section does not say the Fiscal may give credit but the Court may make an order. That is the same as our Courts giving credit.

Navaratnam, for defendant-respondent.

February 27, 1933. GARVIN S.P.J.-

This was an application to set aside a sale held in execution of a hypothecary decree. The applicant is the plaintiff in the action. In the decree which follows the usual form of a hypothecary decree we find a further order in the following terms:-"It is further ordered that in the event of a sale the plaintiff be allowed to bid for and purchase the property and that he be allowed credit to the extent of his claim ". At the sale the plaintiff was represent