Pullata Lakshminarayan vs Bakkida Ramanna and Others

Subba Rao, C.J.—The second appeal is filed against the decree and judgment of the Court of the Subordinate Judge of Srikakulam confirming those of the District Munsif''s Court Sompeta in O.S. No. 11 of 1949. The subject-matter of the suit is of the extent of 2 acres 10 cents of Government Zaroiti dry land described in the plaint schedule. It was originally owned by one Priya Chelamayya and others. They executed a mortgage deed in respect of the suit property in favour of Burla Yerrayya, the father of the 3rd Defendant. Burla Yerrayya filed O.S. No. 52 of 1938 on the file of the Court of the Distrit Munsif, Sompeta and obtained a preliminary decree therein. A final decree followed.

In execution of the final decree, the plaint schedule items were brought to sale and they were purchased by the 1st Defendant on 23-3-1942 for a sum of Rs. 325-0-0. The said sale was confirmed on 15-6-1942. On 10-11-1942 he took delivery of possession. The Plaintiff who was the purchaser of the plaint schedule items from the mortgagors, and who was also impleaded as a Defendant in O.S. No. 52 of 1938 filed an application on 21-4-1942 for setting aside the ex parte decree. The ex parte decree was set aside on 31-8-1944. Thereafter he filed O.S. No. 11 of 1949 on 14-12-1948 for possession of the said items on the ground that by reason of the setting aside of the ex parte decree and also by reason of the subsequent adjustment of the suit claims, the Defendant did not acquire any valid title to the said items.

The learned District Munsif and on appeal the learned Subordinate Judge rejected the claim and dismissed the suit. Hence the second appeal.

The learned Counsel for the appellant, Mr. Dikshitulu contends that there is no (sic) essential distinction between an ex parte decree and a decree on merits, and therefore the decisions holding that the title of a third party purchaser in execution of a decree is not affected by the reversal of the decree, will not apply to a case of a purchaser in execution of an ex parte decree. To appreciate this argument, it is necessary to consider the principles on which the said cases based their decisions. In - AIR 1931 33 (Privy Council) at pp. 35-36 (A), the Judicial Committee had to consider the case of the effect of the adjustment of a decree under Order 21, Rule 2, Code of Civil Procedure, on the sale held in execution of the decree in favour of a third party. Their Lordships held that the third party was protected and the sale could not be set aside.

The reasoning of their decision is found at pp. 35-36 of the Report. It runs thus:

When once a sale has been effected, a third party interest intervenes and there is nothing in this rule to suggest that it is to be disregarded. The only means by which the judgment-debtor can get rid of a sale, which has been duly carried out, are those embodied in Rule 89, viz., by depositing into Court the amount for the recovery of which the property was sold, together with 5 per cent. on the purchase money which goes to the purchaser as statutory compensation and this remedy can only be pursued within 30 days of the sale.

Their Lordships made no reference to the cases under Rule 91 which has no application to the present case.

This principle was followed by Madhavan Nair J. in - Sorimuthu Pillai and Others Vs. Muthukrishna Pillai, , where the learned Judge ruled that under Order 21, Rule 92, Code of Civil Procedure, where no application is made under Rules 89, 90 or 91 to set aside a valid sale, the Court is bound to confirm the sale and cannot refuse to do so on the ground that there was no subsisting decree at the time of the confirmation or on any other ground.

This judgment was accepted and followed by Wadsworth J. in - Ambujammal Vs. P. Thangavelu Chettiar and Another, . There, as in the earlier case, at the time the sale was sought to be confirmed, the decree in execution whereof the property was brought to sale was reversed by the appellate Court. Wadsworth J. points out at p. 401:

There is no provision in the Code for the cancellation of a sale merely because of the cancellation of the decree and though it is in accordance with'' justice that a person who has succeeded in appeal should get from the opposite party such restitution as is possible, there is no principle of justice whereby an innocent 3rd party who has purchased in a valid auction held by the court should be deprived of his property merely because the decree under which the sale was held has been cancelled in appeal.

It is true as contended by Mr. Dikshitulu that in all the aforesaid cases the decree was on merits and that it was reversed by the appellate Court. But the principle of the said three decisions is that there is no provision in the CPC for setting aside a sale on the ground that the decree has been cancelled. I cannot find any reason or justification for not applying the said principle to a case of sale in favour of a third party held in execution of an ex parte decree. Whether a decree is an ex parte decree or a decree on merits, it is a valid decree till it is set aside or modified in accordance with the procedure prescribed by law. It cannot be suggested and indeed it is not suggested that an ex parte decree is void and a nullity, and therefore it can be ignored.

Further for setting aside a sale, held in execution of an ex parte decree, just like in execution of a decree on merits, the CPC prescribes the same remedies. The judgment-debtor, if he seeks to set aside the sale, must proceed either under Order 21, Rule 89 or under Order 21, Rule 90, CPC The only distinction which the learned Counsel was able to point out is that in the case of setting aside an ex parte decree it may be that Section 144, Code of Civil Procedure, may not be applicable. But if Section 144 is not applicable and if a case for restitution is made out, the Court has got ample power u/s 151, Code of Civil Procedure, to order restitution against the decree-holder.

But so far as the third party is concerned, that circumstance cannot conceivably make any difference in the principle accepted by the decisions. I, therefore, hold, agreeing with the Courts below, that the first respondent who is a third party purchaser is protected and the sale in his favour cannot be avoided by the judgment-debtor. No other point arises in the appeal. The second appeal fails and is dismissed with costs. No leave.