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Judgment
Mohan, J.—The facts leading to the Civil Miscellaneous Appeal are as follows; The following three items of property, namely, (1) 146-A,
Muthu Naicker Street, Tuticorin, (2) 124-A, North Cotton Road, Tuticorin and (3)15-B, North Cotton Road, Tuticorin were mortgaged in favour
of the first Respondent-State bank of Tuticorin. The first Respondent filed Original Suit No. 99 of 1972 on the file of the Additional Subordinate
Judge, Tuticorin on the basis of the equitable mortgage executed by the Appellant That suit ended in a preliminary decree on 11th December,
1973. Thereafter on 5th September, 1974 a final decree was passed. Execution Petition No. 52 of 1977 was levied by the decree-holder for the
sale of the hypotheca. On 14th November 1979, they were sold in Court-auction. Item-1 was sold for of Rs. 40,100 in favour of Murugan, the
11th Respondent herein. Item-2 was sold for a sum of Rs. 30,100 in favour of the said Murugan. Item-3 fetched Rs. 37,800 in the sale to the l3th
responind herein. On 13th December, 1979, the Appellant-filed an applications under-Order XXI, Rule 90, CPC for setting aside the sale. That
application was unnumbered. Along with the same application, he preferred Execution Application No. 55 of 1980 to dispense with security.
Pending Execution Application No. 55 of 1980, another application was filed by the Appellant in Execution Application No. 56 of 1980 for stay
of confirmation of sale. Execution application No. 55 of 1980 was dismissed, as not pressed on 13th July 1982 while the application for stay of
confirmation was dismissed on 26th July 1982. However under exhibits B-1 to B-9 dated 31st August 1982, the Appellant sold items 1 and 2,
namely, 146-A, Muthu Naicker Street, .. Tuticorin and 124-A. North Cotton Road, Tuticorin in a favour of third parties. On 10th September,
1981, he filed Execution Application No. 271 of 1981 under Order XXXIV, Rule 5, CPC for setting aside the sale after depositing a sum of Rs.
1,13,865 This represents sale consideration plus pounding charge and all other expenses. It is not denied before me that this amount of Rs.
1,13,855 came to be deposited from out of the sale proceedings under exhibits B-1 to B-9. Thereafter Execution Application No. 119 of 1982
was filed by the 11th Respondent, namely the purchaser of the above items, calling upon the Appellant to etc. either to prosecute Execution
Application No. 271 of 1981 under Order XXXIV, Rule 5 or the application under Order XXI, Rule 90, Code of Civil Procedure. That
application was dismissed as not pressed. Execution Application No. 271 of 1981 itself was taken up and the learned Subordinate Judge
dismissed the same on 26th July, 1982. Thereafter Execution Application No. 136 of 1982. was preferred, by the decree-holder on 29th July
1982 for the issue of a cheque for Rs. 98,097,82. A cheque was issued notwithstanding the objection of the judgment-debtor. It is under these
circumstances, the Civil Miscellaneous Appeal has come'' to be preferred, aggrieved by the dismissal of Execution Application No. 271 of 1981.
It is the contention of Mr. N. Sivamani, learned Counsel for the Appellant that till the sale pursuant to the final decree in the mortgage suit is
confirmed, the Appellant is entitled to redeem the property. This is because of the well accepted principle once a mortgage always a mortgage.
Therefore, where such an application has come to be filed under Order XXXIV, Rule 5 whatever might have been the fate of the earlier
application, in so for as there was no confirmation of the sale that took place on 14th November, 1979, redemption as of right, should have been
allowed. The Court below was wrong indismissing that application.
Mr. M.R. Narayanaswami, learned Counsel for Respondents-11 (auction-purchaser) would submit that confirmation under Order XXI, Rule
92, CPC is a mere ministerial act. No actual order is necessary. In the absence of a valid application under order XXI, Rule 89 or Rule 90, the
Court has no other option but to confirm the sale. Even if there is no such order by mere efflux if time by 30 days in the absence of such of those
applications the sale gets a confirmed and there after the auction-purchaser gets an indefeasible right. That is precise what has been laid down in S.
Ramaswami Aiyar Vs. Komalavalli Ammal, .
The mere filing of an application on 13th December 1979 will not be tantamount to a valid application under Order XXI, Rule 90, because the
party himself did not understand the application that way. He wanted merely the dispensing with of security in Execution Application No. 55 of
1980. Where therefore such a valid application not being there, the Appellant cannot enlarge the limitation of 30 days and seek to file an
application oh 10th September 1981 and then contend that he has got right of redemption.
The further submission of Mr. M.R. Narayanaswami learned Counsel for the llth Respondent (auction-purchaser) is, should this Court be
inclined to allow the Civil Miscellaneous Appeal in any event the right of his client has to be protected from the attachments which have come to be
effected over the amount deposited by the Appellant, namely, Rs. 1,15,855. This is because, in law, the auction-purchaser is entitled to the money
which is due to him. Therefore, any order passed in the Civil Miscellaneous Appeal must ensure to the auction-purchase without reference to the
attachments.
I have given the details as to the facts at some length. From the narration, it is clear the sale took place on 14th November 1979. It cannot be
gainsaid that confirmation of Court-auction sale under Order XXI, Rule 92, CPC is a mere ministerial act. In the absence of an application, under
Order XXI, Rule 89 or Order XXI, Rule 90, the Court has no other option but to confirm the sale. That is very clear by a reading of Order XXI,
Rule 92, which is extracted below:
Sale when to become absolute or to be set aside, (1) Where no application is made under Rule 89, Rule 90 or Rule 91, or when such
application is made and disallowed, the Court shall make an order confirming the sale, and there upon the sale shall become absolute.
Provided that, where any property is sold in execution of a decree pending the final disposal of any claim to, or any objection to the attachment of
such property, the Court shall not confirm such sale until the final disposal of such claim or objection.
(2) Where such application is made and allowed, and where in the case of an application under Rule 89, the deposit required by that rule is made
within thirty days from the date of sale, or in cases where the amount deposited under Rule 89 is found to be deficient owing to any clerical or
arithmetical mistake on the part of the depositor and such deficiency has been made good within such time as may be fixed by the Court, the Court
shall make an order setting aside the sale.
Madras High Court amendment;
(2) Where such application is made and allowed and where, in the case of an application under Rule, 89, the deposit required by that rule is made
within thirty days from the date of sale, and in case where the amount deposited has been diminished owing to any cause not with in the control of
the depositor such deficiency has been made good within such time as may be fixed by the Court, the Court shall make an order setting aside the
sale;
Provided that no order shall be made unless notice of the application has been given to all persons affected thereby.
(3) No suit to set aside an order made under this rule Shall be brought by any person against whom such order is made.
(4) Where a third-party challenges the judgment-debtor''s title by filing a suit against the auction-purchaser, the decree-holder and the judgment-
debtor shall be necessary parties to the suit.
(5) If the suit referred, to in Sub-rule (4) is decreed, the Court shall direct the decree-holder to refund the money to the auction-purchaser, and
where such an order is passed the execution proceeding in which the sale had been held shall, unless the Court otherwise directs, be received at
the stage at which the sale was order.
In S. Ramaswami Aiyar Vs. Komalavalli Ammal, it was held that by mere efflux of 30 days in the absence of such an application the sale get
automatically confirmed and thereafter the auction purchaser gets absolute title to the property. At page 1058 it was observed:
It was argued for the Petitioner that when a judgment debtor''s property is sold in Court-auction and no application to set aside the sale has been
made within 30 days under Order 21, Rules 89 to 90 and 91. he has no saleable interest le in the property, as it must be deemed, to have passed
under the sale to the auction purchaser. It was pointed out that confirmation by Court is a mere ministerial act as the Court is bound to confirm the
sale in such circumstance under Order 21, Rule 92. There are no doubt, indications in the provisions of the CPC that an auction purchaser at a
Court sale does not obtain title to the property immediately on his purchase. Order 21, Rule 92(1) provides:
Where no application is made under Rule 89, Rule 90 or Rule 91, or where such application is made and disallowed, the Court shall make an
order confirming the sale, and thereupon the sale shall become absolute.
Under Section 326 of the old CPC 1982. the title to the property vested in the purchaser only from the date of the sale certificate while u/s 65 of
the present Code, when the sale has become absolute, the property shall be deemed to have vested in the purchaser from the time when the
property is sold and not from that time when the sale becomes absolute, Again under Order 21, Rule 89 a judgment debtor whose property has
been sold has been entitled to apply to set aside the sale as the person ""owning such property"" in spite of the sale. In Pandurang Laxman v. Govind
Dada ILR 1916 40 Bom. 557 the judgment-debtor effected a private sale of the property sold in Court auction before such sale was confirmed,
and the position was held to be not essentially different from case where there is nothingmore than an agreement for sale between the parties, as
the conveyance, in such circumstances, could not operate unless the auction sale was set aside. In Sundaram v. Mama Mavutharu ILR (1921) 44
Mad. 554 (F.B.) a Full Bench of this Court Had to consider the question whether a judgment-debtor who after the sale of his property in Court
auction sold it privately to a third party was entitled, to apply under Order 21, Rule 89. All the learned Judges proceeded on the view that after a
Court sale, the judgment-debtor continues to be the owner of the property, though they expressed somewhat different opinions as to his position
when be effects also a private sale of such property after the Court Sale. Walls C.J., was of opinion that the private sale being valid as between the
parties though it would operate only subject to the auction sale being set aside, the judgment-debtor could, no longer be regarded as the owner of
the property but was entitled to apply as a person holding an interest in the property by virtue of a title acquired before the Court sale. Oldfield
and. Kumaraswami Sastri, JJ., took the view that the judgment-debtor, in such circumstances, continued to be the owner notwithstanding the
Court sale and the private sale. It is thus clear that a judgment-debtor whose property is sold does not cease to be its owner capable of selling it
effectively under certain conditions, so long as be can play to have the sale set aside, that is to say, till the expiration of 30 days from the date of
sale. But, what is the position after that period? Can he still dispose of the property so as to pass an effective title to the transferee against the
auction-purchaser? In other words, has he a ''saleable interest'' in the property? Whatever could be said in support of an affirmative answer to this
question if the matter were re integer, we consider that the decision of the Privy Council in Zamindar of Pojavaram v. Maharaja of Pittapur (1936)
ILR 59 Mad. 910 (P.C.) requires that it should be answered in the negative. In that case a decree-holder having purchased certain properties of
his judgment-debtor at a Court sale in execution of a mortgage decree entered into a compromise with the judgment-debtor''s guardian under
which one of the properties pur caused was to be left to the judgment-debtor in consideration of the alatter agreeing to pay ascertain sum and to
abstain from raising objections to the sale of the properties. The compromise was sanctioned by the Court which confirmed the auction sale with
the exception of the property which was agreed to be left to the judgment debtor, and issued a sale certificate covering the other properties. A
mortgage of that property subsequently executed for the sum agreed to be paid under the compromise having turned out to be inoperative for want
of due attestation, the question arose whether the compromise amounted to a sale by the decree-holder purchaser in respect of which a vendor lieu
for unpaid purchase money could be claimed. In upholding the claim and overruling the objection that there could be no sale by the suction-
purchaser to the judgment-debtor as the title to the property in question never passed to the former under the auction sale which was not
confirmed in respect of that property, their Lordships observed.:
That village, along with other mortgaged property was, as stated, sold to the Plaintiff on 28th October, 1920; ana the period, within which the
judgment-debtor could apply to the Court for setting aside the sale was thirty days from the date of the sales. During that period no such
application was made by him, and the title of the auction purchaser became unimpeachie...It is obvious that after the expiry of the statutory period
for setting aside the sale, there was no person who could uestionthtitle of the auction-purchaser-and a certificate of salfgranted by the Court would
in such case be a formal document of title. In the absence of an order setting aside the sale the Court is bouno to confirm it, and the law does not
prescribe and special period for an application for an order of confirmation.
(Italics. ours).
These observations are, in our view, decisive of the point now under consideration- They show that after the expiry of the period for an application
to set aside an auction sale, the auction-purchaser can effectively sell the property purchased even in the absence of a confirmation of the auction
sale by the Court or, in other words, that he has a ''saleable interest'' in the property. If he has acquired such interest, it is difficult to see how the
judgment-debtor can also be said to have a saleable interest in. the same property, their being no question here of subordinate interest carved out
of the property being owned by different persons.
But the question before us is slightly different. Of course if there was no application till 14th December, 1979, this ruling would clearly apply.
But, however on 13th December, 1979 the Appellant had filed an application under Order XXI, Rule 90. No doubt, be also preferred Execution
Application. No. 55 of 1980 for dispensing with the security. Such an application, to my mind, was wholly unnecessary, because Order XXI, Rule
90 (Madras Amendment) contains the following proviso;
Provided that the Court may, after giving notice to the applicant, call upon him, before admitting the application either to furnish security to the
satisfaction of the Court for an amount equal to that mentioned in the sale warrant or to that realised by the sale, which ever is less, or to deposit
such amount in Court.
This application should not prejudice the right of the Appellant because he was merely overanxious. May be had mortgaged all the properties that
were owned by him. Should the Court call upon him to furnish security, he would be in a fix and therefore be was rather overanxious to the
Execution Application No. 55 of 1980 requesting the Court it that the security may be dispensed with. By that it is no possible to construe the
application filed on 13th December, 1979 as not an application under Order XXI, Rule 90. I have perused the original of that unnumbered
application. That was specifically under Order XXI, Rule 90. Material irregularis like there being no proper publication, the sale consideration
being low, the value of the judgment debtor not being stated in the sale proclamation the injury suffered by the judgment-debtor have all been
stated. Therefore I am unable to agree with Mr. R. Narayanaswami, the learned Counsel for the eleventh Respondent-auction-purchaser that the
Appellant himself did not understand the unnumbered application filed on 13th December 1979 as one under Order XXI, Rule 90. On the
contrary is was very such an application under Order XXI, Rule 90. This unnumbered application as seen from the endorsement made on 13th
July 1982, was dismissed as not pressed. I may extract the very return itself:
Returned.
Execution Application No 551980 to dispense with security is dismissed as not pressed. Hence this petition is returned.
The legal effect of it was that till 13th July, 1982, the Court could not confirm the sale under Order XXI, Rule 92; nor again will the principle laid
down in S. Ramaswami Aiyar Vs. Komalavalli Ammal, would apply, namely, that by efflux of 30 days time the sale gets automatically confirmed,
because as I said above before the expiry of 30 days the application, dated 13th December, 1979 had come to be filed. Under these
circumstances, Order XXXIV, Rule 5 fully comes into play. This is because of the salutary principle, once a mortgage always a mortgage.
It is also well settled that Order XXXIV, CPC is a complete code in itself as far as the mortgage decrees are concerned. Where the Appellant
has fully complied with the terms of this, rule, namely Rule 5 of Order XXXIV, I am unable to see he will be disabled from redeeming the
properties. Therefore the sale will have to be necessarily set aside and an order will follow in terms of Order XXXIV, Rule 5 of the CPC in favour
of the Appellant.
The result of this will be, the parties are relegated to the position prior to 14th November, 1979, namely, the date on which the sale took
place. That being so, the auction-purchaser namely, Respondents 11 and 12 in the Civil Miscellaneous Appeal will be entitled to draw from out of
the sum of Rs. 1,13,855 the money which they are entitled to under Order XXXIV, Rule 5(2). The order enabling Respondents 11 and 12 to
withdraw amounts is passed, notwithstanding the later attachments (later than 10th September, 1981). This is because, only if the money is
available the attachments can subsist. In passing this order there is no necessity to hear the attaching creditors because as I said above the position
of the parties is relegated to the date 14th November 1979. Notwithstanding all this, it is not to be understood that the money realised by the
decree bolder is in any way to be refunded The above orders are passed without prejudice to the order made in Execution Application No. 136 of
1982 in favour of the decree-holder. The civil miscall aneous appeal is allowed. No costs.