Kondre Munemma vs Jarugumallu Veerabhadraiah

Krishna Saran Shrivastav, J.—The decree holder is the Revisionist. The petitioner''s husband obtained a money decree against the respondent in O.S.No. 291/1976. During the pendency of the suit the immovable properties of the respondent-judgment debtor were attached under Order 38 Rule 5 of the Code of Civil Procedure. The deceased-decree holder filed OEP 19/1983 for recovery of the decretal amount of Rs. 5,393-95 ps. by selling the already attached immovable properties, that is, the agricultural lands of the respondent-judgment debtor to the extent of Ac.5-86 Cts. of dry land out of the attached immovable properties. The respondent-judgment debtor remained absent after service of notice of execution and was set ex parte on 29-11-1983. During the pendency of the execution proceedings, the petitioner''s husband died and she was substituted in place of her husband, that is, the deceased-decree holder. The respondent filed an application EA 54/1985 on 28-3-1985 for setting aside the ex parte order dated 29-11-1983. During the pendency of the execution application, a sale notice was allegedly issued which was served on the wife of the respondent on 15-12-1984. Thereafter, the Item No. 1, that is Ac.5-86 Cts. of dry land out of the attached immovable properties of the respondent was put to sale by auction on 29-3-1985. The Amin had put the valuation of the item Noil in question at Rs. 8,000/- at the time of attachment of the same on 21-4-1976. On the date fixed for sale, that is, on 29-3-1985, the executing Court reduced the upset price of Rs. 8,000/- to Rs. 6,300/- on the application of the decree holder in E.A. No. 58 /1985. On the same day permission to participate in the auction was given by the executing Court to the petitioner-decree holder under Order 21 Rule 72 of the Code of Civil Procedure. EA No. 54/1985 filed by the respondent for setting aside the ex parte order was rejected by the executing Court on 29-3-1985 only. Later on the same day, mat is to say, on 29-3-1985, the property was put to sale by auction in Court precincts and 4 persons participated in the auction. The bid of the petitioner-decree holder for Rs. 7,000/- was accepted by the executing Court being the highest bid and the petitioner-decree holder deposited the balance amount of the auction money after getting the decretal amount of Rs. 5,393.95 adjusted,

The respondent filed E.A. No. 109/1983 under Order 21 Rule 90 read with Section 151 of the CPC for setting aside the sale on the ground that the value of the sold property was between Rs. 25,000/- to Rs. 30,000/-, that it was sold at a low price, that no proper publication and proclamation was done, that his sons also got equal shares with him in the attached property which was ancestral, that no sale notice was validly served on him, that no notice was given to him before permission to participate in the auction was given to the decree holder, that his application for setting aside the ex parte order was rejected without enquiry and that material irregularities have been committed in conducting the sale. The petitioner objected the application alleging that the respondent had not filed any appeal against the dismissal of his petition for setting aside the ex parte order, that the sale was conducted after due notice and publication and that the sale proceedings were legal. All the adverse allegations have been denied by the respondent.

The executing Court rejected the application of the respondent holding that the sate was legal as auction was conducted properly.

Being aggrieved by the impugned order, the respondent preferred CMA No. 62 /1993 and this was allowed by the lower appellate Court holding that the certified payment of Rs. 500/- dated 19-7-1979 was not deducted from the decretal amount, that no proper publication of sale was made, that no sale notice was validly served on the respondent and that the report of the Amin dated 21-4-1976 showed the market value of the property sold at Rs. 8,000/- and, therefore, after a lapse of so many years the value as shown in the upset price was too low.

Feeling aggrieved by the impugned order, the decree holder has preferred this revision.

Relying on P. Ramchandra Reddy and Anr. v. M. Raghunatha Reddy 1988(1) ALT 780, it is urged on behalf of the petitioner that, in cases where there is attachment before judgment, there is no question of giving notice for settling the terms of the proclamation of sale at the stage of attachment before judgment because it is not known at that stage whether the suit will end in a decree or whether the suit will be dismissed. In this class of cases, when there is attachment before judgment, there is no question of any re-attachment at the stage of execution in view of the provisions of Order 38, Rule 11 of the CPC and at that stage there is no question of going back to the provisions of Order 21, Rule 54(1-A) of the Code of Civil Procedure. It is also urged that, if the judgment debtor has availed of the notice under Order 21, Rule 66 of the Code of Civil Procedure, he is not entitled to have his valuation noted in the sale proclamation because the duty to Incorporate the estimate of the judgment debtors or the decree-holders arises only if they have availed of the opportunity to furnish their estimate, vide proviso to Order 21, Rule 66(2) of the Code of Civil Procedure, It is further contended on behalf of the petitioner that the judgment debtor has not only to establish that there was inadequacy of price but should further establish that the inadequacy was caused by reason of the material irregularity or fraud and a connection has to thus be established between the inadequacy of the price and the material irregularity and for this proposition reliance has been placed on the case of Shri Radhey Shyam Vs. Shyam Behari Singh, and on the case of Jaswantlal Natvarlal Thakkar Vs. Sushilaben Manilal Dangarwala and others, . The learned counsel of the petitioner has also Submitted, on the authority of Shiromani Gurdwara Prabandhak Committee, Amritsar Vs. Mihan Singh (Dead) Rep. by Baba Banta Singh, , that once notice under Order 21, Rule 22 of the CPC is served on the judgment-debtor, omission to notice the judgment-debtor again under Order 21, Rule 54 or notice under Order 21, Rule 66 does not render the further action in pursuance thereof void. ,

On the other hand, it is contended on behalf of the respondent-judgment debtor, relying on the case of Satyanarain Bajoria and another Vs. Ramnarain Tibrewal and another, , that the proceedings for setting aside the sale under Order 21, Rule 90 of the Code are independent proceedings and the file of proceedings under Order 21, Rule 22 of the Code could not be referred to in such proceedings without proof of notice under Order 21, Rule 54 and Rule 66 of the Code of Civil Procedure. The sale held on 29-3-1985 is void and the proceedings subsequent thereto, therefore, are void. It is further urged on behalf of the respondent that the lower appellate Court has rightly held that the property sold at the relevant time was valued at about Rs. 30,000/- and it was sold to the petitioner-decree holder for a meagre amount of Rs. 7,000/-, that too after reducing the upset price and granting permission to him to bid at the auction without notice to the respondent and, therefore, the sale is illegal because it has caused substantial loss to the respondent-judgment-debtor.

It is a matter of record that on 6-6-1983 the judgment-debtor was noticed under Order 21, Rule 22 of the CPC and he made his representation in the. Court through his Advocate on 8-8-1983. His Advocate sought time to file counter on 8-8-1983, 29-8-1983, 29-9-1983, 7-10-1983, 24-10-1983, 14-11-1983, 21-11-1983 and 29-11-1983. On 29-11-1983, they remained ex parte and the judgment-debtor was proceeded ex parte.

If is pertinent to note that the respondent in Para 3 of his affidavit has alleged that he had engaged an Advocate in the Execution Petition and his Advocate has taken time in the first hearing of the case for filing counter and thereafter he went outside the State for livelihood and there was no communication between him and his Advocate and, therefore, he was proceeded ex parte on 29-11-1983. He came to know about the sale two days before 29-3-1985 on his return to his village through local newspaper. Application for setting aside the ex parte order was filed on 28-3-1985. Thus, it is established that the respondent-judgment debtor had knowledge about the execution proceedings and he had engaged an Advocate who had appeared before the executing Court on the first hearing of the case and obtained time to file counter, but later both of them remained absent, with the result the respondent was proceeded ex parte on 29-11-1983.

It is held in the case of Desk Bandhu Gupta v. N.L Anand & Rajinder Singh ( supra) in para 10 that:

"Above discussion do indicate discernible rule that service of notice on the judgment debtor is a fundamental part of the procedure touching upon the jurisdiction of the Execution Court to take further steps to sell his immovable property. Therefore, notice under Order 21 Rule 66(2) unless proviso is applied (if not already issued under Order 21 Rule 22), and service is mandatory. It is made manifest by Order 21 Rule 54(1-A) brought on statute by 1976 Amendment Act with peremptory language that before setting the terms of the proclamation of sale. The omission thereof renders the further action and the sale in pursuance thereof void unless the judgment debtor appears without notice and thereby waives the services of notice."

In the case of Satyanarayain Bajoria (supra) it is held that the proceedings for setting aside the sale under Order 21, Rule 90 of the Code are independent proceedings and the file of proceedings under Order 21, Rule 22 of the Code could not be referred to in such proceedings without actual proof of service as per the provisions of service of notice. In this case notice under Order 21, Rule 22 of the CPC was said to have been served on the judgment debt or but the judgment debtor had specifically denied the service of such notice on him. The decree holder had not examined the process server to prove the service of notice under Order 21, Rule 22 of the Code of Civil Procedure. It was held in this case that the lower appellate Court had no knowledge what so ever of how even notice under Order 21, Rule22 of the CPC was required to be served or the evidence in relation thereto being led in proceedings for setting aside of the sale at the instance of the judgment-debtor and under these circumstances the lower appellate Court could not read the order sheet or proceedings purporting to be under Order 21 Rule 22 of the Code while dealing with proceedings under Order 21, Rule 90 of the Code of Civil Procedure. The question whether notice under Order 21 Rule 54 and /or Rule 66 of the CPC is mandatory even if the judgment-debtor is earlier served with the notice under Order 21, Rule 22 of the CPC or he had participated in the proceedings earlier but remained absent later was not involved.

The position of law thus emerges is that service of notice on the judgment debtor is mandatory under Order 21, Rule 54 and/or under Order 21, Rule 66 of the Code of Civil Procedure, as the case may be, unless the judgment debtor is not already served with a notice under Order 21, Rule 22 of the CPC and/or he had participated in the earlier stage of the execution proceedings, but later remained absent and is set ex pane or not at the time of settling the terms of sale and issuance of the proclamation of sale, mat is to say at the stage when the proceedings are drawn under Order 21, Rule 54 of the CPC or under Order 21 Rule 66 of the Code of Civil Procedure.

As noted above, from the affidavit of the judgment debtor, dated 28-3-1985, it is established that he had engaged an Advocate who had appeared in the execution case and has sought time to file counter, but later the judgment debtor and his counsel remained absent and, therefore, they were proceeded ex parte on 29-3-1985. Since the sold property was attached before judgment, the provisions of Order 21, Rule 54 are not attracted vide Ramachandra Keddy''s case (1 supra), but then notice under Sub-rule 2 of Rule 66 of Order 21 of the CPC would have been necessary, had the judgment debtor not participated in the earlier stage of the execution proceedings.

In the case of Jaswantlal Natvarlal (supra), Full Bench consisting of three Hon''ble Judges, has held that notice to the judgment-debtor is necessary before permission is granted under Order 21 Rule 72 of the Code of Civil Procedure, particularly when the upset price is proposed to be reduced.

On perusal of the record, it is crystal clear that the Amin has estimated the market value of the property sold, at Rs. 8,000/- as on 21-4-1976, and this property was free from encumbrance. The sale by auction was fixed for 29-3-1985. On that day, at the application of the petitioner-decree holder, the upset price shown at Rs. 8,000/- in the proclamation of sale, was reduced to Rs. 6,300/- without notice to the judgment debtor. Similarly permission to participate in the auction was given to the decree holder on the same day without notice to the judgment debtor. It is pertinent to note that the application for setting aside the ex parte order dated 29-11-1983 was also dismissed by the executing Court on 29-3-1985 and the property was sold by auction and the highest bid of the petitioner-decree holder of Rs. 7,000/- was accepted on the same day. Thus, it can be safely inferred that the judgment debtor, though present through his Advocate, on 29-3-1985, no notices as shown above were served either on the judgment debtor or on his counsel.

As noted above, the Amin has estimated the market value of the sold property to be Rs. 8,000/- as on 21-4-1976. There is uncontradicted statement of the judgment-debtor on record that the value of the property at the time of sale by auction was between Rs. 25,000/- to Rs. 30,000/-. There is no evidence in rebuttal. The decree holder never objected the report of the Amin wherein it is mentioned that the value of the property sold was Rs. 8,000/- as on 21-4-1976. With the aid of experience in life, it can be safely presumed that there must have been hike in the market value of the sold property after the lapse of about 9 years and, therefore, there appears to be a ring of truth in the statement of the respondent-judgment debtor that the value of the sold property was between Rs. 25,000/- to Rs. 30,000/- admeasuring Ac.5-86 cents at the time of its sale.

It is true that inadequacy in price by itself is not sufficient to set aside the sale until it is established that the inadequacy was caused by reason of material irregularity or fraud as also the establishment of the fact that it has caused substantial injury to the judgment-debtor.

In the case of Seethammal Vs. Senthil Finance and another, , the sold property was originally valued for a sum of Rs. 75,000/-, but subsequently its value was reduced to Rs. 50,000/- and at the auction it was sold for a mere sum of Rs. 15,100/- when the upset price was fixed at Rs. 15,000/-. This property was sold subject to discharge of the mortgaged sum of Rs. 40,000/-to the mortgagee who was none else but the decree-holder himself. The Apex Court in the aforementioned circumstances held that the sale conducted by the executing Court was obviously illegal and, therefore, set aside the same.

In the case on hand, the value of the property sold appears to be between Rs. 25,000/- and Rs. 30,000/- at the time of auction. The upset price originally fixed at Rs. 8,000/- was reduced to Rs. 6,300/- without notice to the judgment debtor. On the date of auction itself, permission to take part in the auction was also given to the husband of the petitioner decree-holder without notice to the respondent-judgment debtor, though representation was made on his behalf on that day. The property was sold to the husband of the petitioner who was the decree holder. The conduct of the original decree holder, since dead, shows that every, effort was made by him to see that he somehow succeeds in purchasing the property at a throw away price and he somehow succeeded in this attempt.

Under these circumstances, no fault can be found out either with the approach or the finding of the appellate Court that the material irregularities caused in conducting the sale of the sold property have resulted in substantial loss to the respondent-judgment-debtor.

It is stated on behalf of the respondent-judgment-debtor that, in pursuance of the setting aside the sale by the appellate Court, the respondent- judgment debtor has deposited the entire decretal amount due with interest before the executing Court, but on account of the stay granted in this revision, no orders could be passed by the executing Court.

For the foregoing reasons, the findings recorded by the appellate Court do not merit any interference, particularly when the impugned order, even if allowed to stand, would not occasion failure of justice or cause irreparable injury to the petitioner-decree holder.

In result, the revision fails and hereby is dismissed. However, in the circumstances of the case, I leave the parties to bear their own costs.