Kamleshwari Prasad vs Mahadeo Sahai

Rowland, J.—This is an application to revise an appellate order affirming the refusal by the Munsif to set aside a sale of immovable property under Order 21, Rule 90, Civil P.C. The objection takon was that the decree under execution was a decree in respect of a loan or interest on a loan. It was in fact a mortgage decree. That being so, Section 13, Bihar Money. e lenders {Regulation of Transactions) Act, was applicable and it was the duty of the Court to hear the parties and form an estimate of the value of the property and of the portion of the property the sale of which should be sufficient to satisfy the decree and that the Court should have issued a fresh sale proclamation u/s 14 of the same Act in respect of only so much of the property as would be likely to be sufficient to satisfy the decree. The applicant before us had presented in the Munsifs Court a petition dated 28th September 1940 for proceeding under the above Sections 13 and 14 for valuing the property f and for issue of a fresh sale proclamation. The application was refused on the ground that at an earlier stage in the pendency of the same execution case the applicant had appeared after the issue and publication of sale proclamation and, had asked for an instalment decree to be passed. In that petition he had waived all rights to the issue of a fresh sale proclamation and had waived all objections as to the valuation of the property. Substantially the finding of the Court was that after such waiver it was not open to the judgment-debtor to maintain the present application. Accordingly the Munsif rejected g the application and held the sale and the Subordinate Judge before whom an appeal from this decision was heard maintained the decision.

Now it is argued in revision that the Munsif in putting up the property to sale acted without jurisdiction or in excess of his jurisdiction, because, it is said, once an application was made u/s 13, Money-lenders (Regulation of Transactions) Act, it became mandatory to fix a valuation under that section and to proclaim for sale u/s 14 only so much of the property as was necessary. In support of this contention reliance is placed on the decision of this Court in Gunjari Mahatani v. Nil Kamal Panda A.I.R.1914 Pat.418. The Subordinate Judge had considered this case and thought that it could be distinguished on the facts. He preferred to follow an earlier ruling of this Court which proceeded upon the general proposition that the judgment-debtor cannot resile from his undertaking and is estopped from raising the question of valuation when the objection is one of the objections which he waived at an earlier stage. That decision was given before the passing of the money-lenders'' legislation by the Provincial Legislature of this province. We shall have therefore to consider cases of this Court decided after the passing of the Money-lenders Act and the amending Act.

First I should refer to the state of the statute law regarding sale proclamations. The general rule immediately before the passing of the Money. lenders Act which is the general rule still is embodied in Order 21, Rule 66 of the Code. That rule in the form in which it stands in this province runs as follows:

(1) Where any property is ordered to be sold by public auction in execution of a decree, the Court shall cause a proclamation of the intended sale to be made in the language of such Court.

(2) Such proclamation...shall state...the time and place of sale, and shall specify as fairly and accurately as possible (the particulars stated in Clauses (a)(b)(c)(d) and (e) next following, with the proviso): That no estimate of the value of the property other than those if any made by the decree-holder and judgment-debtor respectively together with the statement that the Court does not vouch for the accuracy of either shall be inserted in the sale proclamation.

Sub-rules (3) and (4) provide for verification of the application for an order for sale and for the ascertainment by the Court of the matters to be specified in the proclamation. The Court may examine any person and may require him to produce any document relating to the property. That is still the general rule for the execution of decrees not of a kind referred to in the Money-lenders Act and the Money-lenders (Regulation of Transactions) Act, but in dealing with "the execution of a decree passed in respect of a loan or interest on a loan by the sale of the judgment debtor''s property," Section 18, Money-lenders Act, requires that

the Court executing the decree, shall, notwithstanding anything to the contrary contained in any other law or in anything having the force of law, hear the parties to the decree and estimate the value of such property and of that portion of such property the proceeds of the sale of which it considers will be sufficient to satisfy the decree.

The proviso allows the whole property to d be sold, if necessary and Sub-section (2) permits an appeal by any person aggrieved by an order passed under Sub-section (1). Section 14 applies to the same class of cases as Section 13 and enacts that notwithstanding anything to the contrary contained in any other law or in anything having the force of law the proclamation of the intended sale of the property in execution of a decree in respect of a loan or the interest on a loan shall include only so much of the property of the judgment-debtor, the proceeds of the sale of which the Court considers will be sufficient "to satisfy the decree and shall state the value of the property or portion of the property" as determined u/s 13. And other provisions follow to prevent the property being sold at a price lower than the price specified in the sale proclamation subject to 8 certain exceptions.

Placing side by side the statutes, it is apparent that the statute book contains two very different methods of procedure in preparing and issuing sale proclamations one procedure being applicable to a certain class of cases and the other procedure to all other cases. Now let us see exactly what was done in the decisions which have been cited before us. Gunjari Mahatani v. Nil Kamal Pande A.I.R.1941 Pat.418 the sale proclamation had at first been issued in accordance with Order 21, Rule 66. Eleven lots had been advertised for sale. The judgment-debtor had obtained two adjournments waiving the necessity of issue of a fresh sale proclamation. She had then applied for permission to pay up by instalments, but this was refused. She then applied u/s 13, Bihar Money-lenders Act, claiming that the properties should be valued under that section and that only a portion of the properties should be sold u/s 14. The Munsif then proceeded to make a valuation u/s 13. A single lot, namely, lot No. 7 was valued at a sum sufficient to satisfy the decree. Then the Munsif without issuing a fresh sale proclamation put lot No. 7 up for sale. It was held that he had no jurisdiction to do this. That is a result which I think must g follow from the statement of the statutory provisions which I have given above for the sale proclamation and sale were neither proceeding in accordance with the CPC under Order 21, Rule 66, etc., nor in accordance with the Money-lenders Act.'' The Munsif had begun to apply the Money-lenders Act, Sections 18 and 14, but had not fully applied its provisions. The result that followed in this Court was a decision that once the Munsif had fixed a valuation and directed the property to be sold, he was bound to issue a new proclamation containing the matters set out in Section 14. Without doing so, he had no right or jurisdiction to direct an immediate sale. I have no wish to question that decision on its own facts, but it is pointed out earlier in the decision that a question had been raised whether the judgment-debtor had a right to apply for valuation u/s 13 of the Act when she had obtained adjournments of the earlier sale and waived the need of a fresh sale proclamation. But this Court said: "Whatever be the merits or demerits of such a contention, it is unnecessary to consider." But that is the very contention which is in issue before us and Mr. Sarjoo Prasad relying on Gunjari Mahatani v. Nil Kamal Pande A.I.R.1941 Pat.418 has been unable to get away from the fact that the very point in issue before us was expressly left open in deciding that case.

In another case of this Court in Chandra Sekhar v. Sedhar v. Bhagwan Das A.I.R.1941 Pat.440 the execution had proceeded in the manner laid down in the Civil Procedure Code, Order 21, Rule 66 arid so on. The point taken in revision was that the executing Court ought to have applied the provisions of Sections 13 and 14, Money-lenders Act, and ought to have valued the property independently of the valuation of the decree-holder. The appeal to this Court failed mainly on the ground that no such objection had been taken in the Court below. It was said by Harries C.J.:

No objection was taken that the properties had not been valued up until the time the sale took place although the present objection could well have been urged in which case the Court would have been bound to value as directed by Section 16 and proceed with the sale as directed by Section 17 of the 1938 Act.

The references to Sections 10 and 17 correspond to Sections 13 and 14 of the 1939 Act.) The passage last quoted distinguishes that decision from the case before us in which an objection and a prayer to value the property were in fact made to the Court before the sale took place.

Another recent decision of this Court is in Sheo Dayal Narain Vs. Mt. Moti Kuer and Another, . I may state some of the facts. In the executing Court after the issue of a sale proclamation there was a compromise between the parties whereby the judgment debtor was given six months to pay up the decretal amount. The sale was adjourned for six months and the judgment-debtor waived all right to make any objection regarding issue of a fresh sale proclamation. After the expiry of the six months, the sale was held after certain adjournments, the judgment-debtor not having put in any appearance or objection as to the valuation or any other matter or asked the Court to have the property valued under the Money-lenders Act. Subsequently, the judgment-debtor moved the executing Court to treat the sale as void on the ground that the Court had not complied with the mandatory provisions of Section 13, Money-lenders (Regulation of Transactions) Act, 1989. In the trial Court, the application succeeded no doubt on the view that Section 13 is obligatory on the Court in any case which its own facts bring within the scope of the Bihar Money-lenders Act. On appeal, however, the District Judge held that the judgment-debtor could not succeed because he had waived his right to have the property valued and also because the objection was of a kind governed by Order 21, Rule 90 and the judgment-debtor was not under that rule as amended by the Patna High Court entitled to put it forward after the sale when he could have put it forward before the sale, but did not do so. The application to set aside the sale regarded as an application under order 21, Rule 90, was also out of time. The point argued in the High Court was that the sale was a complete nullity and did not need to be set aside. In the High Court the substance of the decision was that though the procedure followed in the first Court might be defective and the sale might be voidable, yet the sale was not void and must stand unless there was an application presented within time under Order 21, Rule 90 and on grounds admissible under that section. It was not necessary for the Court on that view to determine whether non-compliance with Section 13 was a good ground to set the sale aside; nor have we in the present case to decide that as this is not a second appeal. The point before us is whether sale was without jurisdiction.

By the decisions above examined, it appears to be established that (a) once the executing Court has applied Section 13 it acts without jurisdiction if it fails to act in accordance with Section 14 and to issue the fresh sale proclamation which that section requires; (b) although the decree under execution may be a decree passed in respect of a loan, a Court g does not act without jurisdiction in proceeding under order 21, Rule 66 if its attention is not drawn to the special nature of the decree requiring a special procedure before the sale takes place. In such a case, an application to set aside the sale under Order 21, Rule 90 may also be barred by the proviso to that rule as amended by the Patna High Court.

In the present case it is true that before the sale the Court''s attention was drawn to the fact that the appropriate procedure was under the Money-lenders Act and not under Rule 66. What we have to see is whether the question which of these two procedures was to be followed had been already concluded either by a decision inter partes which had not been appealed from or by estoppel or waiver by act of one of the parties. The question whether Rule 66 of Order 21 or Section 13, Moneylenders Act, governs a case is a question partly of fact and partly of law which may arise in any particular case, and did arise in this case. The judgment-debtor had a right to demand that the execution procedure should be according to the Money-lenders Act. But by accepting the sale proclamation made under Order 21, Rule 66 to be a valid proclamation, he, at an earlier stage, waived the right to raise this question, and gained some advantage by way of postponement and in other a ways. Can he now be allowed to re-open and re-agitate the same objection? Waiver, it may be conceded, cannot confer jurisdiction where no jurisdiction exists. But the Court was a Court which had jurisdiction to execute decrees under the procedure in the CPC unless facts were brought to its notice making that procedure inapplicable.

That being so, when the judgment-debtor had waived his right to have a different procedure applied, I think that the Courts were right in refusing to allow him to raise that objection at a late stage of the same proceedings. The result will be that the application fails and is dismissed with costs: hearing fee two gold mohurs.

Reuben J.

I agree.