Jagan Nath and Another vs Custodian Property and Others

Kapur, J.—This is a rule directed against an order passed by a Subordinate Judge of Delhi satting aside the sale at the instance of the Custodian and ordering the D.H. to refund the decretal amount to the auction-purchaser.

The sale in execution of a decree against Rehamt Ullah was confirmed on 28-6-1948. On (Sic)-1-1949, the Custodian applied for the setting de of the sale u/s 8, East Punjab Evacuees'' (Administration of Property) Act, XIV (14) of 1947 and on 11-3-1950, the order was passed which is the subject-matter of the present revision.

By the time the order of the Court was passed Ordinance No. XXVII of 1949 had been promulgated and it came into force on 18-10-1949.

The first submission of Mr. Sarin on behalf of the Petitioners is that this sale could not be set aside because in the present Act which was passed in 1950 and came into force on 18-4-1950, it is only sales made under orders of a Court which can be set aside. I am unable to agree with this submission because the transfer of property in an execution sale always takes place under the orders of a Court, although it may be in execution of a decree. Therefore this contention is without any substance and must be overruled.

The next submission of Mr. Sarin, the learned Counsel for the Petitioners which appears to me to require some consideration, is that after a sale is set aside by a Court u/s 17(2), Administration of Evacuee Property Act, 1950, or under the corresponding Ordinance, Ordinance No XXVII of 1949, or even u/s 8, East Punjab Act XIV (14) of 1947 the Court has no power to order the refund of money which has been paid (Sic) to the D.H. and he has relied on a judgment of the Madras High Court in ''Macha Koundan v. Kottora Koundan'' 59 Mad. 202, where it was held that where a mortgage decree and the sale of the mortgaged property in execution of the mortgage decree were held, in a suit filed by a third party subsequent to the confirmation of the sale, to be (Sic) binding on the third party, and as a consequence thereof, the auction purchaser lost possession of the property he had a right to recover the purchase-money from the D.H. by a separate suit and not by proceedings in the executing Court. But as against this there are a large number of cases which give to the Court the power to make restitution in cases where a sale is set aside.

In Jai Barham v. Kedar Nath 21 A.L.J. 90, it was observed by Lord Carson at p. 493:

It is the duty of the Court u/s 144, CPC to place the parties in the position which they could have occupied, but for such decree or such part thereof as has been varied or reversed. Nor (Sic) deed does this duty or jurisdiction arise merely under the said section (144). It is inherent in the general jurisdiction of the Court to act rightly and (Sic), according to the circumstances, towards (Sic) parties involved.

(Sic) his Lordship referred with approval to the observations of Lord Cairns, L.C., in Rogers v. The Comptoir d ''Escompte de Paris'', (1871) L.R.P.C. 465 at p. 457, where it was observed:

Now, their Lordships are of opinion, that one of the first and highest duties of all Courts is to take care that the act of the Court does no injury to any of the suitors, and when the expression ''the act of the Court'' is used, it does not mean merely the act of the Primary Court, or of any intermediate Court of Appeal, but the act of the Court as a whole, from the lowest Court which entertains jurisdiction over the matter up to the highest Court which finally dispose of the case. It is the duty of the aggregate of those Tribunals, if I may use the expression, to take care that no act of the Court in the course of the whole of the proceedings does an injury to the suitors in the Court.

In Amba Lal v. Ramgopal Modhoprasad 55 All. 221, in execution of a money decree property was brought to sale and purchased by the D.H. him-self. Two other judgment-creditors were also paid off by the auction purchasers rateably. The co-sharers of the J.D. then obtained a decree exempting part of the property from the operation of the sale. The amount available for rateable distribution was thus reduced and the auction-purchaser was held to be entitled to a proportionate refund from the other judgment-creditors. It was also held that restitution was dictated by duty cast upon the Court to see that no act of the Court did injury to the suitors. At p. 228 the Court observed:

It is manifest from these cases that the jurisdiction of a Court to grant restitution in appropriate cases is not confined only to cases coming within the purview of Section 144 of the Code and that it is inherent in the general jurisdiction of the Court to pass an order for restitution independently of the provisions of Section 144, with a view to secure complete justice between the parties concerned.... We hold, therefore, that it is not only permissible, but is imperative, to grant restitution by exercisng the inherent powers vested in Courts as defined by Section 151 of the Code, provided the exercise of those powers is necessary for the purpose of preventing injustice and does not contravene any statutory provision.

In Ram Rattan Prasad v. Benarsi Lal'' 9 Pat 685, it was held that the provisions of Section 144, Code of Civil Procedure, did not apply to a case where the sale in execution of a decree was set aside under Order 21 Rule 90, CPC and the J.D. applied for restitution and mesne profits. The Court could,'' owever, in the exercise of its inherent power u/s 151, CPC order restitution and direct the auction-purchaser to maker over to the J.D. the profits realised from the property, having got hold of the property by an abuse of the Court''s process. This was a judgment of Fazi Ali, J., with whom Dhavle, J., agreed. At p. 688 Fazi Ali, J., observed:

Now, looking to the language of Section 144 it is clear that a duty is cast upon the Court to order restitution only where and tin so far as a decree is varied or reversed. In this particular case, it is clear that although the sale was set aside the decree remained intact and it was neither varied nor reversed. This being so, the case in my opinion does not come within the purview of Section 144. I do not, however, mean to suggest for a moment that where the decree is not ''reversed or varied, the Court will be entirely powerless to order restitution even though the ends, of justice may require it, because, as has been held in a number of cases, the Court has inherent Jurisdiction to make, such orders as are necessary in furtherance of the ends of justice.... This view was clearly enunciated in the case of Sukhdeo Das v. Rito Singh'' 2 P.L.J.369.

The learned Judge again, at p. 689, observed:

In my opinion, therefore, the decree not being reversed or varied, the provisions of Section 144 did not apply to the case and the Munsif could only act u/s 151, CPC in the exercise of the inherent jurisdiction of the Court.

The authorities show that, even where a case does not strictly fall within the purview of Section 144, CPC in so far as the decree is not varied or reversed, in order to do complete justice between the parties, the Court has inherent jurisdiction u/s 151, CPC to order the D.H. to return the money under its inherent powers if the sale has been set aside under the circumstances in which the present sale has been set aside.

Mr. Sarin submits that the safer remedy open to the auction-purchaser in a case like this is to bring a suit for the return of his money. I do not think that Courts are so powerless that they cannot do justice between parties in cases where they themselves are instrumental in setting s aside a sale, which may be under the provision of a different statute.

Another objection raised is that when a suit is possible a Court should not interfere u/s 151, Code of Civil Procedure. With this I am unable to agree. In a case where by an act of a Court, one of the innocent parties is deprived of property, it appears to me that it is the duty of the Court, if it can without infringing any other statute, to put the parties in the position that they were before the sale took-place. I am unable therefore to gree With this submission of Mr. Sarin on this point.

Another submission made is that the auction purchaser has not applied for restitution and the Court should not ''suo motu'' do it. I do not think that it is a very serious obstacle in the exercise of powers of the Court which it should exercise in order to do complete justice between the parties

In the result, therefore, the petition fails and is dismissed and the rule is discharged, but I leave the parties to bear their own costs throughout.