Chunni Lal vs Santoo Lal

N.N. Mithal, J.—In this F.A.F.O. the decree-holder Appellant challenged the decision of the executing Court who has set aside the execution sale held on 21-5-78 by allowing the objection of the J. D. under Order 21, Rule 90, Code of Civil Procedure.

In spite of service nobody has put appearance on behalf of the Respondent. From the facts of the case it appears that in pursuance of the decree in favour of the Appellant certain properties of the Respondent were attached. When the proceedings for execution took place only one house was put up for public auction on 21-5-78. Since no objection was filed within time the auction sale was confirmed on 2-8-78. The Respondent filed objection on 2-9-78. These objections were allowed on 21-5-79 by the impugned order by which the Court held that the execution sale had taken place for a grossly inadequate sum and the property worth Rs. 50,000/- was purchased by the decree-holder for Rs. 11,800/- only. This is the sole ground on which the objections have been allowed.

Sri S.P. Srivastava, learned Counsel for the Appellant, has urged several points in support of the appeal.

The first point that has been stressed before me is that the objection under Order 21, Rule 90, Code of Civil Procedure, filed by the Respondent did not accompany the deposit of 12 1/2 per cent of the auction money, as requried by the proviso added to this Rule by this High Court, After the amendment the relevant proviso reads as under:

(a) ...

(b) Unless the applicant deposits such amount not exceeding 12 1/2 per cent of the sum realised by the sale or furnished such security as the Court'' may, in its discretion, fix except when the Court for the reasons to be recorded dispenses with the requirements of this clause:

provided further that:

No sale shall be set aside on the ground of irregularity or fraud unless upon the facts proved the Court is satisfied that the applicant has sustained substantial injury by reason of such irregularity or fraud.

Incidentally a question may arise as to what is the position of this amendment after coming into force of the CPC Amendment Act, 1976 (Act No. 104 of 1976). According to the Amending Act local amendments which were not consistent with the provisions of the Amended Act, are to .be superseded by the provisions of the amending Act.

On a comparison of the language of Rule 90 and the language that has been incorporated after the amendment by Central Act No. 104 of 1976 I find that there is no substantial difference between the two, except that the auction-purchaser also has been made entitled to file an objection under this Rule. The other change is that the irregularity or fraud must now be confined to publishing and conducting of the sale. There is, therefore, hardly any inconsistency with the amended section. So far as the proviso is concerned this matter was considered recently by a learned single Judge of this Court in Rana Harish Chandra Jung v. Agricultural Bank of Garhwal Ltd. 1982 All LJ 749 where a similar point arose. The learned single Judge observed as under (para 3):

Things are said to be inconsistent when they are contrary to one to the other, so that one infers the negation, destruction or falsity of the other. But there is no difficulty in obeying the Parliament law as contained in Order 21, Rule 90 and the amendment made to that provision by U.P. High Court simultaneously. Both provisions can be obeyed without any possibility of a conflict arising in their obedience.

The question that remains to be seen is whether compliance of the proviso is a precondition for entertaining the objections raised by the judgment- debtor at all. Earlier, there had been substantial divergence of opinion in this Court. In Bawan Ram and Another Vs. Kunj Behari Lal and Another, a learned single Judge of this Court held that:

the requirement of Clause (b) of the proviso to Rule 90 must be complied with either at the time when the objection was filed or in any case before the period of expiry of limitation for making such application. If this is not done objection under Rule 90 must be rejected.

Same view was taken by a Division Bench of this Court in Dullu v. Devi Charan 1962-All LJ 759 wherein it was held that:

Although it was not imperative that making of deposit and furnishing of security should be done either before or simultaneously with the making of the application under Rule 90 yet this must be done before the period of limitation prescribed for making such an application expires.

It appears that the attention of the Bench was not invited to the two earlier Division Bench decisions of this very Court which are Dhoom Chand Jain Vs. Chaman Lal Gupta and Another, and Kundan Lal Vs. Jagan Nath Sharma, . In both these cases it was held that:

the only bar created by Clause (b) of the proviso was against the judicial consideration of the application if the same was not backed up by necessary deposit or security.

Subsequently in Haji Rahim Bux and Sons and Others Vs. Firm Samiullah and Sons, another Division Bench of this Court took the same view and held that.

After the application is made within time compliance by making deposit or furnishing security must be done only before the judicial consideration of the application.

Same position was reiterated in the case ; of Mahavir Singh v. Gauri Shankar AIR 1964 AH 289 and Smt. Jaggi v. Ram Autar 1965 All LJ 1135. The controversy was finally set at rest by a Full Bench decision of this Court in M/s. Lalla Mal Hardeo Dass v. Sukh Dayal Ram Bilash ILR (1967) 2 All 724 where all the aforesaid cases were considered and the Court observed as under:

Upon the aforesaid consideration it is clear that when the proviso declares, that the application shall not be entertained unless the applicant complies ,with Clause (b), it refers to the point for judicial consideration in order to act upon it and, in a proper case, to require the Respondent to show cause against the application being allowed on the grounds contained in it. Before that stage is reached the applicant must comply with the order made by the court under Clause (b).

In my judgment, upon an application being filed under Order 21, Rule 90 the court must call upon the applicant to establish whether the requirements of Clause (b) should be dispensed with and if not, what according to him should be the amount of deposit to be made or the security to be furnished. It should appoint a date upon which the applicant can produce evidence on the basis of which he claims either that the requirements of the clause should be dispensed with or, according to him, what should be the amount to be deposited or the security to be furnished. That date need not fall within the period of limitation prescribed for an application under Order 21, Rule 90. Before making the order under Clause (b) the Court should afford an opportunity to the parties in the execution proceedings, who may be affected by such order to be heard in the matter. Where the court decides not to dispense with the requirement of Clause (b) it will make an order fixing the amount to be deposited by the applicant or the security to be furnished by him, and will specify a period within which deposit must be made by the applicant. Upon the making of that order the applicant is under a duty to comply with it, and if he does not, his application for setting aside the sale is liable to be dismissed.

In the case of Lakshmi Rattan Engineering Works Ltd. Vs. Asstt. Commr. Sales Tax, Kanpur and Another, a question arose as to what is meant by the word ''entertain''. In that connection some of the aforesaid cases were considered and approved by that court.

Finally this question directly arose in Hindusthan Commercial Bank Ltd. Vs. Punnu Sahu (Dead) through Legal representatives, . That Court fully approved its earlier decision and held that:

Word ''entertain'' in Sub-clause (b) of the proviso to Rule 90 means to ''adjudicate upon'' or ''proceed to consider on merit'' and does not mean the initiation of proceedings.

On a consideration of all these cases it is obvious that although the application or objection Under Order 21, Rule 90, CPC had to be filed within 30 days, as required under Article 127 of the Limitation Act yet it is not necessary that the deposit of 121/2 per cent of the auction money or security should be furnished within this period of 30 days. It would suffice if the same was done prior to the application or objection being taken up for judicial consideration by the Court.

In the instant case the facts disclosed that the Court without either directing or requiring the objector to comply with this condition entertained the same and proceeded to judicially consider it and ultimately allowed the same. In adopting this procedure the party was not at fault, for as observed by Supreme Court in Hindusthan Commercial Bank Ltd. Vs. Punnu Sahu (Dead) through Legal representatives, the Court said (at p. 1386):

As observed by Allahabad High Court in Kundan Lal Vs. Jagan Nath Sharma, it is expected that the court would ordinarily give an opportunity to the applicant to comply with clause ''B'' of the proviso and should reject the application if the same was still not complied with.

It is, therefore, obvious that the procedure adopted by the Court below in this respect was not properly followed and it would have been necessary for me to remand the case to the court below. However, the next plea raised by the learned Counsel regarding the application under Rule 90, Code of Civil Procedure, it being beyond time changes the situation,

According to the learned Counsel an objection under Order 21, Rule 90, CPC should be preferred within a period of 30 days from the date of auction sale under Article 127 of the Indian Limitation Act, 1963. In this case admittedly the auction sale took place on 21-5-1978, while the objection under Rule 90 was filed only on 2-9-78. This was clearly beyond 30 days, period prescribed for doing so. Such a plea was also taken by the Appellant in reply to the objection filed by the Respondent under Rule 90. The Court below did not attach any importance to it and has not even discussed it in its order. If a little attention had been paid to this plea the application or objection under Rule 90, could have been disposed of on this very short point. Any way since the matter has been raised again before me it appears to be so obvious that this objection was beyond time and as such the same could not have been entertained by the Court below.

The Court below in the impugned order, has mentioned that the disputed property has been sold only for a sum of Rs. 11,800 while this very property had been shown by him as worth Rs. 50,000/- in the statement submitted under Order 21, Rule 66, CPC Treating it as an admission of the decree-holder the Court below was of the view that the sale was for a grossly inadequate consideration. A perusal of the record, however, shows that this was not so. As observed by the succeeding District Judge in his order dated 11-8-1979 passed on an application for review by the decree holder, the price of Rs. 50,000/- was shown in respect of this property as well as several other properties which had been attached in execution of the decree. At no place the decree holder had mentioned the price of the disputed property alone as Rs. 50,000/-. The argument of the learned Counsel for the Appellant on this point also appears to be sound but this is not material for decision of this appeal In view of the above, the appeal deserves to be allowed on the simple ground that the objection filed by the deft J. D. under Order 21, Rule 90, CPC was beyond time. I, however, do not consider it necessary now to enter upon adjudication on some other points raised on behalf of the Appellant in this appeal.

In the result the appeal succeeds and is accordingly allowed. The order dated 21-5-1979 passed by the District Judge, Banda is hereby set aside and the objections filed by the Respondent under Order 21, Rule 90, are dismissed with costs. However, the costs in this Court shall be easy as no one has resisted the appeal.