S.K.M. Mohammad Mustafa Maracayar vs Udaianachi Ammal

(1)This revision proceeding involves a question of some degree of interest, whether the permission to bid and set off granted to the mortgagee

decreeholder in a pending sale of the hypotheca, could be granted without specifying any special grounds therefor, or whether it should be

conceded only with caution and under special circumstances. The facts are not in dispute. The revision petitioner is the judgment debtor who

opposed the grant of the permission to bid and set off in this case. The respondent is an assignee-mortgagee-decreeholder and she has now

obtained this permission. The court overruled the objections of the judgment debtor, and granted permission in a cryptic order, in which no special

grounds are set forth. However, it seems to be a fact that the mortgagee decreeholder has been attempting to realise the debt by sale of these

properties on several occasions, and that the last time that the sale was held, the sale was unsuccessful.

(2) Certain very relevant aspects of this situation have been the subject of comment by Krishnaswami Nayudu, J. In M. Varadarajulu Pillai Vs.

Gendapodinanniar and Others, . The learned Judge referred to and followed a very early decision of the Calcutta High Court in Sheonath Doss v.

Jankiprosad Sing, ILR(1889) Cal 132 and also made reference to the observations of the Judicial Committee in Mahomed Meera Ravuthar v.

Raghunada Aiyar Appa Meikan Gopalan, (1900) 10 MLJ 1 and of Schwabe, C. J. in P.V. Raghavachariar, by his authorised Agent, P.R.

Srinivasan Vs. Murugesa Mudali and Others, . All these authorities emphasise the broad principle that caution should be exercised in granting leave

to bid and set off to the decree-holder, and that where the permission to bid and set off is granted to the mortgage, that discretion should be

exercised with considerable care; instances of that kind should be scarce and not liberal. In the present case, the facts are incontrovertibly

established that the mortgagee decreeholder has not been able to realise the debt, from January 1963, that the mortgage is of the year 1937, and

that there was at least one unsuccessful sale, on a prior occasion. Under those circumstances. I do not think that it is necessary to interfere in

revision with the order of the court below, granting leave to bid and set off. But I must reiterate the principle emphasised in the catena of cases that

I have referred to, namely, that such permission should be cautiously granted, and after due enquiry into all attendant circumstances. Since it is not

a matter of course, but a discretion to be judicially exercised, it is certainly desirable that the order should specify the grounds on which the

permission has been granted, particularly where the objections thereto have been overruled.

(3) There are, however, one or two other special features of this case, upon which I desire to comment before dismissing the revision. The first is

that the hypotheca appear to be extensive in extent, and the case of the judgment-debtor is that they are very valuable. In the light of that pleading

it is certainly desirable that there should be due publicity, before the sale is actually held. The second feature is that, in accordance with O. 21, R.

83, C.P.C., the judgment-debtor desires to have an opportunity to negotiate for a private sale of the property to satisfy the mortgage debt, before

the sale is finally held and rights are created in a third party purchaser, or the decreeholder succeeds in being the highest bidder. I direct that, in

view of the facts of this case, such an opportunity might be given to the judgment-debtor, at any time on or before the actual date of sale. If the

judgment-debtor produces such an intending purchaser who is willing to deposit the amount of the debt due to the mortgagee, an opportunity

should be given for making the deposit, and the sale should be held only if this attempt fails. This revision is accordingly dismissed. The parties will

bear their own costs.

(4)Revision dismissed.