M. Varadarajulu Pillai vs Gendapodinanniar and Others

Krishnaswami Nayudu, J.—This is a revision petition against the order of the Subordinate Judge of Salem, granting permission to the

decree, holder to bid at the sale of the properties ordered in E. P. No. 140 of 1947, in O. S. No. 6 of 1941. The decree is a mortgage decree and

four items of the mortgaged properties are sought to be sold by virtue of the order for sale. The decree-holder filed E. A. No. 217 of 1948 for

leave to bid under Order 21, Rule 72, Civil P. C. This application is supported by an affidavit by plaintiff 1 who states in para 3 of the affidavit that

if the plaintiffs are not given leave to bid in the said auction sale, the properties might be sold for a low price and they are likely to suffer loss. This

allegation was denied in the counter-affidavit filed by respondent 2 (judgment-debtor) where he stated that one of the items (Item No. 1) is a talkie

theatre where one can expect certainly one kind of bidders and that two persons who are able to invest more than a lakh of rupees and that the

properties had not been advertised in proper places and if permission was given to the decree-holders they would knock off the properties for a

bare upset price and they would be put to serious loss. On these allegations in the affidavits the learned Judge passed the following order : ""No

ground for not granting permission. Permission granted."" It is against this order that the present revision petition is filed.

The learned counsel for the petitioner invites my attention to the provisions of Order 21, Rule 72, Civil P. C., and Rule 199 of the Civil Rules of

Practice. It is clear that a decree-holder can-not bid without the express permission of the Court and under Rule 199 such a permission should be

sought for and obtained on an application which shall be supported by an affidavit setting forth the facts showing that an advantageous sale cannot

otherwise be had. On a perusal of the affidavit filed, I am unable to see what the circumstances are, that are alleged by the decree-holders, to call

upon the Court to pass an order granting permission to bid, except the statement that if leave to bid is not given the property might be sold for a

low price and they are likely to suffer loss by reason of that. Nothing is alleged in the affidavit to justify any Court to exercise its mind and come to

the conclusion that an order for permission to bid asked for may be granted.

The learned counsel referred to a decision in Seonath v. Jankiprasad, 16 cal. 132, where it was observed that permission to a mortgagee to bid

should be very cautiously granted and only where it was found after proceeding with a sale that no purchaser at an adequate price can be found,

and even then only after some enquiry as to whether the sale proclamation has been duly published. This observation was considered by the Privy

Council in Mohamed Mira Rowther v. Savvasi Vijaya Raghunatha Gopalar, 23 Mad. 227: 27 I. A. 17, and their Lordships observed as follows

with reference to that decision:

In this case the Calcutta High Court dwelt on the necessity of great caution in granting leave to bid ; indeed it laid down such conditions as would

make the granting of leave a very rare thing instead of being, as their Lordships believed it is, a very common thing.

As pointed out by Mr. Radhakrishnayya, the learned counsel for the petitioners, the Privy Council are of opinion that such restrictions as would

seem to have been laid down by the learned Judges of the Calcutta High Court should not be placed in the way of a Court granting permission to

bid. In Raghavachariar v. Murugesa Mudali, 46 Mad. 583: A. I. R. 1923 Mad. 635, Schwabe C. J. observed as follows :

The main question for the Court to consider is whether it is to the advantage or disadvantage of every one concerned in order to obtain the

highest price that the plaintiffs should be allowed to bid or not.

I respectfully agree with the learned Judges in this decision that the question to be considered is whether it will be to the advantage of every one

concerned that leave to bid ought to be given on the application of the decree-holder. I would also observe that in this case the application for

leave to bid was made for the very first sale and even for the first sale the decree-holder without any material that he could place before the Court,

apprehends that the properties may not fetch a good price. Though I am not in entire agreement with the conditions laid down by the learned

Judges in the Calcutta case to enable a decree-holder to obtain permission to bid, I am, however, of opinion that the power to grant leave to bid

must be cautiously exercised and unless the Court is satisfied from the circumstances shown in the affidavit that otherwise an advantageous sale

could not be obtained, no such leave should be granted. In this case as pointed out there was nothing shown to the Court and the Court has in the

exercise of its jurisdiction acted with material irregularity. In this case the lower Court has been in error in granting leave to bid under Order 21 ,

Rule 72 of the Code.

The revision petition is allowed and the order of the lower Court is set aside. The petitioner will get his costs from the respondent.