Raj Kumar vs Satishwar Dayal and others

A.D. Koshal, J.—This is a second appeal by the Judgment-debtor against the dismissal of his objections under Rule 90 of order 21 of the CPC (hereinafter referred to as Order 21) by the two courts below.

The proceedings have arisen in execution of a decree for the recovery of Rs. 4,0000/- passed in favour of Respondent No. 1 on the 31st of May, 1963. The executing Court attached land belonging to the judgment debtor and situated at Gohana and Banwasa. The land at Gohana was auctioned for Rs. 550/- in favour of the one Banwas was sold to Hukam Chand Respondent No. 2 on the March 1965 for Rs. 2,575/-. The amount last-mentioned was deposited by Respondent No. 2 with the executing Court against two treasury receipts, one dated the 1st of April, 1965 for Rs. 643/- and the other dated the 23rd of August, 1965 for Rs. 1932/-. Both the sales were set aside by the executing Court through its order dated the 24th of June, 1957, the operative part of which may be reproduced here with advantage:

Out of the auction money of the land situated at Gohana Rs. 27.50 be credited to Government as commission fee. The remaining amount will also not be given to the auction purchaser unless the sale has been again effected. As regards the auction money of the land of Banwasa Rs. 129/- be credited to the Government as Commission fee and the remaining amount would not be given to the auction purchaser unless the sale has been effected again. The warrant of sale of both the lands beagain issued.

Both the parcels of land were re-auctioned, the one at Gohana on the 8th of August 1967 for Rs. 1,500/- in favour of Ram Dayal Respondent No. 3 and that at Banwasa on the 22nd of December 1970 for Rs. 4,400/ in favour of Hukam Chand Respondent No. 2. These sales were also challenged by the judgment debtor through two applications under Rule 90 of Order 21. In relation to the sale of Gohana land it was claimed inter alia that the auction had been held not at the site or location of the land but at the Tehsil office and this factor had caused loss to the judgment-debtor. A similar objection was taken to the sale in respect of the Banwasa land. The other objection contained in the two applications are not material for the purpose of deciding this appeal.

The two Courts below found on a consideration of the evidence produced by the judgment debtor that he had failed to substantiate any of the objections.

At the hearing of the appeal the Learned Counsel for the judgment-debtor has taken up the following three points:

(a) It was incumbent on the Tehsildar conducting the sale of the Gobana land to hold the auction at site. He acted without jurisdiction in conducting the proceedings relating to the auction at the Tehsil office.

(b) 25 per cent of the purchase-money was not paid by Respondent No. 2 to the Tehsildar immediately after the former had been declared to be the purchaser of the Banwasa land. The sale was therefore, a nullity in view of the mandatory provisions of Rule 84 of Order 21.

(c) The sale of Banwasa land was a nullity also for the additional reason, that Respondent No. 2 did not pay the balance of the purchase money in lull within 15 days from the sale as required by the provisions of Rule 85 of Order 21.

Point (a) has no merit. The proclamation sale of the Gohana land specifically stated that the auction would be held at the Tehsil Office on the 8th of August 1967 as is clearly made out from the report dated 18th of July 1967 of Bhagwan Singh Patwari on the reverse of the warrant of possession issued by the executing Court on the 7th of July, 1967. Learned Counsel has failed to show that in these circumstances it was incumbent on the auctioneer to hold the auction at site. In fact-when his attention was drawn to the provisions of Rule 66 of Order 21, according to which the place of sale is to be stated in the proclamation, he conceded that his objection had no force.

Now 1 take up point (b) I have allowed it to be raised in spite Of the fact that it was not taken before the executing Court because on the admitted facts it raises merely a question of law such as would go to the root of the matter and make the sale a nullity if answered in favour of the Appellant. According to Mr. Jain, Learned Counsel for the judgment-debtor, it was the duty of Respondent No. 2 when he was declared to be the auction purchaser of the Banwasa land to pay or deposit 25 per cent of the purchase-money and he could not treat the money already lying to his credit with the Court and mentioned in its order of the 24th of June, 1937 extracted above as the deposit. In my opinion this contention has no force. A sum of Rs. 2,446/- (Rs. 2,575/- minus Rs. 129/- was lying to the credit of Respondent No. 2 with the Court and the same was due for payment to him as soon as the sale of the Banwasa land was held over again. That sale was held, as already stated, on the 22nd of December, 1970 and as soon as Respondent No. 2 was declared to be the auction-purchaser, the money stood released in his favour. He could certainly withdraw the money on that date and deposit the same towards part payment of the purchase-money and, if he had done, so no exception could be taken to the course on the ground that the provisions of Rule 84 of Order 21 had not been complied with. If that be so, how can there be an objection to the auction-purchaser taking the stand that the money lying with the Court be treated as having been deposited by him towards the purchase money ? The acts of physically withdrawing the money and ro-depositing it were not required to be performed under any provision of law, nor could they be insisted upon by dictates of common sense or justice in spite of the fact that the provisions of Rule 84 of Order 21 are mandatory as held by their Lordships of the Supreme Court in Manilal Mohanlal Shah and Others Vs. Sardar Sayed Ahmed Sayed Mahamad and Another, . Learned Counsel, however, places reliance on the dicision in that case for the proposition that no party other than the decree-holder can claim a set-off for the moneys due to him when such party becomes liable to make a deposit under Rule 84 of Order 21. The facts of that case are, however, distinguishable. There the land was sold for Rs. 53,510/- in execution of a decree. The auction purchasers claimed that they were mortgagees of the land, that the amount due to them was Rs. 1,20,000/-, and that they were entitled to a set-off of part of the amount last mentioned against the purchase money. It was in these circumstances that their Lordships held that-

The provision regarding the deposit of 25 percent, by the purchaser other than the decree-holder is mandatory as the language of the rule suggests. The full amount of the purchase money must be paid within fifteen days from he date of the sale but the decree-holder is entitled to the advantage of a set-off. The provision for payment is, however, mandatory. (Rule 85). If the payment is not made within the period of fifteen days, the court has the discretion, to forfeit the deposit and there the discretion ends but the obligation of the court to re-sell the property is imperative. A further consequence of non-payment is that the defaulting purchaser forfeits all claim to the property. (Rule 86).

It is not denied that the purchasers had not obtained any decree on foot of their mortgage and the claim of Rs. 1,20,000/- which they put forward before the execution court had not been adjudicated upon or determined. The mortgagees, one of whom is a Pleader, applied on the day of the sale claiming a set off on foot of the mortgage. The Court without applying its mind to the question immediately passed the order allowing the set-off. This claim was obviously not admissible under the provisions of Rule 84 which applies only to the decree holder. The Court had clearly no jurisdiction to allow a set-off. The Appellants misled the "Court into pa sing a wrong order and obtaining the advantage of a set-off while they knew perfectly well that they had got no decree on foot of the mortgage and their claim was undetermined.

There was default in depositing 25 per cent, of the purchase money and further there was no payment of the full amount of the purchase money within fifteen days from the date of the sale. Both the deposit and the payment of the purchase money being mandatory under the combined effect of rules 84 and 85, the court has the discretion to forfeit the deposit but it was bound to re-sell the property with the result that on default the purchaser forfeited all claim to the property. These provisions leave no doubt that unless the deposit and the payment are made as required by the mandatory provisions of the rules, there is no sale in the eye of law in favour of the defaulting purchaser and no right to own and possess the property accrues to him.

Now, in the case before their Lordships, there was no deposit at all with the Court and their remarks that the auction-purchasers misled the Court into passing a wrong order while they knew perfectly well that they bad got no decree on foot of the mortgage and that their claim was undetermined, unmistakably indicate that the absence of the decree on foot of the mortgage was the main reason for the decision. This is apparent from an earlier part of the judgment which details the facts of the case and in which their Lordships observed:

It is important to bear in mind that the mortgagees had filed no suit and obtained no decree to recover the money due on the mortgage.

In the present case the auction-purchaser is not claiming a set-off merely on the basis of an undetermined claim. He had an actual cash deposit with the Court and such deposit had been made in payment of the purchase-money relating to an earlier sale which had been set aside. That deposit must, in my opinion, be considered to be as good a deposit as one made immediately after the conclusion of the auction so that the auction purchaser was fully entitled to have it considered as a deposit made under Rule 84 of Order 21.

Point (c) was never taken before the executing Court and even though it would go to the root of the case if substantiated, I cannot allow it to be taken at this stage because it involves the determination of both questions of law and fact. According to the judgment-debtor the total amount paid by Respondent No. 2 on account of the purchase-money was Rs. 4271/- which fall short of the total purchase-money by Rs. 129/-. If this be so, the judgment-debtor could have raised the objection at the earliest opportunity so that the executing Court might have determined its validity on facts. It may be that Respondent No. 2 could have shown that he had paid not only Rs. 4,271/- as is claimed on behalf of the judgment-debtor but also the balance of Rs. 129/-. Under the circumstances the objection is not entertained. Of course it would be open to the judgment debtor to raise it before the executing Court now, if the law so permits him.

In the result, the appeal fails and is dismissed with costs Counsel fee Rs. 101/-.