Phulchand Ram Marwari and Another vs Naurangi Lal Marwari

Wort, J.—The Subordinate Courts of this province seem inclined from time to time to interpret Section 151, Civil Procedure Code, as giving them power which under the general law they do not possess; in other words, there is a tendency to do what is sometimes called, and erroneously called, ''substantial justice1 though as a matter of fact it often amounts to injustice. In this case the learned Judge in the Court below has exercised what he believes to be his powers under the section in giving compensation to the decree-holder under the following circumstances. The decree-holder, i.e. the respondent to this application, obtained a decree against the father and sons. I should have stated that the decree was a compromise decree. The conditions of the compromise not having been complied with, the decree-holder exercised his rights by putting the decree into execution, and in pursuance of that, put up for sale the joint property of the father and of the sons. In due course, the property was sold and the decree-holder respondent having had leave to bid purchased the property for upwards of Rs. 7,000. Then in due course, after the statutory period had elapsed, the sale was confirmed and full satisfaction was entered.

Then there started an action by the minors claiming that (for reasons which perhaps need not be gone into in this appeal) the compromise decree was not binding upon them. That action succeeded. The result of that was that their eight annas interest in the property which had been put up for sale was released. But the decree stood, that is to say, the decree stood against the father as a joint and several decree and the sale stood as a whole: the sale itself was not affected--I use the expression ''sale'' in contradistinction to ''property'' although eight annas of the property was necessarily released. Then this application was made by the decree-holder respondent for compensation to the extent of half of the amount purchased by him. I should have stated, however, that before this application was made, an application had been made for execution which resulted in an appeal from the decision of the Subordinate Judge of Bhagalpur to this Court. The appeal came on for hearing before my Lord the Chief Justice and my learned brother Varma (Miscellaneous Appeal No. 285 of 1934 reported in Phulchand Ram v. Nauranji Lal 16 PLT 906 : 164 Ind. Cas. 1073 : 2 BR 795(1) : 9 RP 144. There it was decided, to use the words of the head-note, that

The decree-holder could not take out farther execution of the decree which had already been satisfied. It was immaterial that in his capacity as auction-purchaser he had purchased the property of some one which was not liable under the decree.

I would add to my statement that there was an observation in that case which fell from the learned Chief Justice to the effect:

It Would be for the decree-holder, if he had some other remedy, to pursue that remedy, as he might be advised.

Some reliance has been placed upon those words as if deciding that the decree-holder has now a remedy which he has successfully pursued in the Court of the Subordinate Judge. I have already stated that after the hearing of that appeal in this Court. this application u/s 151 for compensation was made. I must say that 1 had some difficulty in coming to a conclusion in this case having regard to what 1 believed to be the decision of the Allahabad High Court in (Dubey) Amba Lal Vs. Firm Ram Gopal-Madho Prasad . Without referring at the moment to the facts, it was stated there that the decree-holder in circumstances not dissimilar from the present (although I shall point out in a moment that there were certain facts in that case which do not exist in the case before us) was entitled to compensation. Now I refer for the moment to the authority in Abinash Chandra Kar v. Bhuban Chandra 25 CWN 756 : 63 Ind. Cas. 126 : AIR 1921 Cal. 115 upon which Mr. Mukharji, on behalf of the appellants, strongly relies. A statement of facts of that case would disclose the position in this case, unless it can be shown that on the facts there is any difference in principle between the cases, to put it more correctly, whether the facts of this case as compared with those of the case reported in Abinash Chandra Kar v. Bhuban Chandra 25 CWN 756 : 63 Ind. Cas. 126 : AIR 1921 Cal. 115 in any way would modify the principle there laid down by the learned Judges. The action there which gave rise to the proceedings was a mortgage action. The property was put up for sale in execution of a mortgage decree. certain persons claimed that certain property which was put up for sale in execution of the decree was not the property of the judgment-debtor, and it was be decided. The result was that the decree-holder who himself was the purchaser obtained, to state it briefly, less than what he thought he would obtain from the purchase which he had made. Richardson, J. in the course of his judgment makes a statement of the case which I think is valuable for the purposes of considering the argument advanced in this case. The learned Judge says:

I apprehend, when a decree-holder hag obtained leave to bid and has purchased the property of the judgment-debtor, he is, generally speaking, in the same position as any other auction-purchaser.

He then refers to Mahabir Pershad v. Macnaghten 16 IA 107 : 16 C 682 : 5 Sar. 345 : 13 Ind. Jur 133 (PC):

For the present purpose his position seems to me not more favourable but less favourable than that of a third party, because the sale was held at his instance and presumably it was he who supplied to the Court the particulars of the property published in the sale proclamation. The principle, as I understand, is that, apart from the case provided by Rule 91 and apart, of course, from fraud, a purchaser at an auction-sale must abide by his bargain. What is sold and bought is the right, title and interest of the judgment-debtor in the property. The Court which sells the property does not guarantee the title and the maxim caveat emptor applies.

Now it is not denied that if the facts of that case were the same as those in the case before us to-day, there could be no dispute that the principle laid down by the learned Judge in that case would apply to this one. But it is contended that although generally speaking the principle caveat emptor does apply to Court sales, the facts in this case are such as to make the principle inapplicable. Now the only fact which can be referred to as differentiating the case from Abinash Chandra Kar v. Bhuban Chandra 25 CWN 756 : 63 Ind. Cas. 126 : AIR 1921 Cal. 115 is the fact that the property which has been released- from sale is the property of the persons who were in the first instance parties to the action, and it is stated by Dr. Mitra and great reliance, as I understand his argument, is placed upon the statement that at the time of the sale there was a decree against these persons and therefore at that time it was right and proper that the property should have been put up for sale; to put it in other words, the property was the property of the judgment-debtors. Now I could appreciate the argument that if the statement of facts to which 1 have made reference is a statement of anything other than the mere history of the case, it may be possible to hold that the principle caveat emptor does not apply. But we must look at the case from the point of view of the facts as they stand at the present moment.

It is contended by Mr. Mukharji on behalf of the appellants that the original decree stands. I am not sure that I am altogether in agreement with that contention. So far as Mr. Mukharji''s client, the father, is concerned, there is no doubt that the decree does stand; but the effect of the judgment in the action which was brought by the minors is that the decree is not binding upon the minor defendants in that action. But it is quite clear, whether Mr. Mukharji''s contention is valid or not, that at the present moment we must consider this case as if there had been no decree against the minor sons. And in my judgment, when that is stated, all that can be said about the facts relating to the action brought by the minors for the purpose of having a declaration to the effect that the decree is not binding on them, is mere history, and does not affect the principle caveat emptor. That being so, it is perhaps wise to lay down one or two principles to clear away the dealings in the authority which has been relied upon. It is quite clear in the first instance that had the decree-holder purchased property which eventually turned out to be less valuable than he had anticipated, then as Richardson, J. pointed out, in the absence of fraud there could be no claim for compensation. It is equally true that had the facts of the present case been similar to those in the case reported in Abinash Chandra Kar v. Bhuban Chandra 25 CWN 756 : 63 Ind. Cas. 126 : AIR 1921 Cal. 115 and I understand Dr. Mitra to agree to the proposition that the principle laid down there would apply. Now having regard to that statement it seems to me that the only question one has to consider in this case is whether the fact that the minors, being originally parties to the action, in any way alters or modifies the principle which is to be applied. As I have already stated, that fact is nothing more than a part of the history of the case, and we are to deal, and indeed bound to deal, with the case as if no decree had ever been passed against the minors. If a decree is held not binding on a person, then it must be assumed that there is no such decree. That being so, the only question in my judgment to consider is the decision in (Dubey) Amba Lal Vs. Firm Ram Gopal-Madho Prasad to which 1 have already referred. Glancing at the judgment it would appear at first sight that the learned Judges in that case in some way modified the principle which in that case had been held to be applicable to Court sales, namely, the principal caveat emptor, and there is some discussion which would perhaps to some extent bear that statement out. But the learned Judges at page 230 of the report make the statement:

We are not unaware of the fact that the rule that the doctrine of caveat emptor applies to Court sales has been laid down in a series of cases but we may point out that the application of that doctrine has undoubtedly the effect of negation of justice in many cases.

With great respect to the learned Judges I fail to see how the application of the doctrine caveat emptor can do injustice If a person purchases a property under circumstances in which the principle caveat emptor applies, he does so at his own risk as the principle suggests, and if he suffers loss, he has himself alone to blame. But one need not go into a very detailed discussion of that case, because on analysis it will be seen that the learned Judges there were dealing with a case which is almost entirely different from the case which we have before us to-day. Indeed, if any inference is to be drawn from the facts of the case, it is an inference against the respondent-decree-holder rather than in his favour I will endeavour to make myself clear on this point by statins the facts of that case. There the decree-holder had purchased certain properties which after various pieces of litigation were held to be the properties of persons other than the judgment-debtor. On the footing of the price which he paid for the whole of the property, rateable distribution had been made between him and other decree-holder who had decrees against the same judgment-debtor. The result of the litigation being what it was, that is to say that the person had successfully claimed certain of the properties which had been put up for sale, the decree-holder made a claim which was the subject-matter of the case against the other decree-holders on the footing that a larger sum than they were entitled to, having regard to the events which had happened, had been distributed to them, and a refund was claimed and the question which the learned Judges decided there, was whether Section 144, Civil Procedure Code, was exhaustive and whether compensation could be made u/s 151.

I now come to the point which I stated before I referred to the facts of the case The very fact that the decree-holder who had purchased in the Court sale was claiming against his fellow decree-holders is a suggestion that he could not have made the claim against the judgment-debtors. Now the case in (Dubey) Amba Lal Vs. Firm Ram Gopal-Madho Prasad does not in any way affect the principle which is to be applied to the facts of this case. I have already stated and repeat that at first sight it did appear to be strongly in support of the respondent in this case. The learned Judges in that case made reference to an earlier decision of their own Court, namely, that in Anand Krishna Vs. Kishan Devi and Others which was in substance the application of the principle laid down in the case reported in Abinash Chandra Kar v. Bhuban Chandra 25 CWN 756 : 63 Ind. Cas. 126 : AIR 1921 Cal. 115 to which I have already referred. It is sought of course in this case to apply Section 144, Civil Procedure Code, by analogy.'' It is admitted that Section 144 does not apply, but it is said it gives some indication that the Court may in the exercise of its powers u/s 151, Civil Procedure Code, give compensation in. proper cases. But if Section 144 is to be treated in any way as an analogy, the compensation which the de- cree-holder would seek in this case should be against the sons and not against their father. On what principle, it may be asked, can the decree-holder be entitled against the judgment-debtors against whom he has already got a judgment and whose property he has sold. It seems very difficult to discover any principle upon which the decree-holder would be entitled to compensation against the present judgment-debtors. In no sense were the judgment-debtors at fault. They did not put the property up for sale. They had nothing to do with the sale proclamation, but the property had been sold by the Court. They have had the advantage which perhaps may work out in this case as an unjust advantage of the decree being entered as fully satisfied under the execution. In my judgment, neither on principle nor on authority is the decree-holder entitled to compensation against the judgment-debtors and, as has been already held, the decree-holder is not entitled to take further execution against them. For those reasons, in my judgment, the decision of the learned Judge was erroneous and must be set aside. I would add that the application was u/s 115, Civil Procedure Code, and it was contended by Dr. Mitra in the course of his argument that what the learned Judge in this case has decided is a question of law. Speaking for myself, had I been satisfied that it was merely a question of law that the Judge had decided, certainly there would be one late of this application, as the learned Judge had jurisdiction to decide a question of law rightly or wrongly. But the substantial question in this case is whether he had jurisdiction to make this order u/s 151, and, as their Lordships of the Privy Council have pointed out, a decision on a point of law may be interfered with if in fact the question of jurisdiction does arise. The proper order, therefore, to make is that the Rule nisi is made absolute, the judgment of the learned Judge in the Court below is set aside with costs, and we allow hearing'' fee to the extent of five gold mohurs.

Varma, J.

I agree.