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391 paragraphs · 9,046 wordsS.S. Subramani, J.—Except C.R.P. No. 1135 of 1990, the other matters, namely, C.R.P. Nos. 591 and 592 of 1984 and C.M.A. No. 97
of 1984 arise from a common order passed by the learned Subordinate Judge Tuticorin, in O.S. No. 148 of 1971. C.R.P. No. 591 of 1984 arises
from E.A. No. 287 of 198 C.R.P. No. 592 of 1984 arises from E.A. No. 224 of 1981 and C.M.A. No. 97 of 1984 arises from E.A. No. 501 of
1980 in the above suit C.R.P. No. 1135 of 1990 also arises from the same suit, but it arises from E.A. No. 476 of 1986 against the Order passed
thereon, on 20.7.1987. The material facts of the case can be summarised as follows:-
The plaint schedule property which is the subject matter of these proceedings originally belonged to late Ramasamydoss who died on 7.1.1964.
He died as a debtor and some of his legal representatives filed a suit O.S. No. 26 of 1995 on the file of Sub Court, Tuticorin, for administration of
the estate and for taking accounts. Various creditors were also made parties to the suit, and all the properties belonging to him were also
scheduled, which included his self acquired properties and also properties over which he had an undivided share. In that suit, an Advocate was
appointed as an Administrator, who took possession of the properties which included the subject matter of these proceedings. While the suit was
pending, another suit was filed before the Sub Court, Tuticorin as O.S. No. 148 of 1971, by one Emperumalsami Naicker on the basis of a simple
mortgage executed by the deceased. In that suit, the 11th defendant was the Administrator appointed in O.S. No. 26 of 1965. A preliminary
decree was passed in that case on 29.8.1972, and final decree was also passed on 8.10.1973 for sale While so, in the administration suit O.S. No
26 of 1965, the plaint property was brought to sale by the Administrator and the wife of the second defendant in the mortgage suit, one Chandra,
was the highest bidder. The Administrator moved the Sub Court for accepting the bid of Chandra for which various objections were raised and
ultimately, as per order dated 15.7.1977, the Subordinate Judge, Tuticorin confirmed the sale in favour of Chandra. That order has become final.
By virtue of that sale, Chandra became the purchaser of the property, which is the subject matter of these proceedings. It may be noted that one
Emperumalsami Naicker, who is the 6th defendant in O.S. No. 26 of 1965 filed serious objection against the confirmation in favour of Chandra. It
was after rejecting his objection, the sale was confirmed. The relevancy of the objection will be considered in the subsequent stages of this Order.
Thereafter, pursuant to the final decree in the mortgage suit O.S. No. 148 of 1971, the very same properly was brought to sale on 11.1.1978,
auction was held and the property was sold. An application under O. 21, R. 90, C.P.C. was filed by Chandra on 3.2.1978 alleging that the
auction in the mortgage suit is bad and that she has purchased the property from the Administrator, and even before the sale in her favour, she was
in possession of the property as lessee under the Administrator. It was further stated in that Application that the decree holder as well as auction
purchaser were aware of the sale in her favour, and according to her, there cannot be two sales in respect of the same property. Various other
grounds under O. 21, R. 90, C.P.C. were also stated therein. When that Application was filed, security had to be furnished, and she claimed
exemption from furnishing security by filing E.A. No. 104 of 1978. That application was dismissed, and consequently her application under O. 21,
R. 90, C.P.C. which was unnumbered then also could not be taken into consideration. Against the order in E.A. No. 104 of 1978, she filed
C.R.P. No. 1631 of 1978. This Court, as per order dated 10.8.1978, set aside the order and directed the matter to be considered afresh. She
also filed E.A. No. 110/78 to accept third party security. Even after remand, again the application was dismissed. C.M.A. No. 227 of 1979 was
filed against that dismissal order. As per judgment dated 9.8.1979, the order of the executing Court was again set aside, and the matter was
remitted back. In the meanwhile, since the Application, namely, E.A. No. 110 of 1978, for accepting third party security was dismissed, the sale in
this suit (O.S. No. 148 of 1971) was confirmed. After the judgment in C.M.A. No. 227 of 1979, third party security was furnished and the
application to set aside the sale was numbered. When the same was registered, second defendant, along with his wife, filed E.A. No. 224 of 1981
under O. 34, R. 5, C.P.C. for permitting them to deposit the amount due to the decree-holder along with the poundage, and to have the sale set
aside. The judgment debtor also filed E.A. 287 of 1981 under S. 151, C.P.C. to restore E.P. No. 62 of 1975, the reason being that even though
the sale was confirmed by an Order, in view of the remand in C.M.A. No. 227 of 1979, the application under O. 21, R. 90. C.P.C. has to be
restored and, therefore, the Execution Petition also has to be restored to file. It is these applications that were disposed of by the common order,
which is challenged in these Revisions and C.M.A. The auction purchaser in O.S. No. 148 of 1971 is dead and his legal representatives have been
impleaded. The decree-holder has no objection in setting aside the sale. But, according to the auction purchaser, Chandra, the purchaser from the
Administrator, has no right or interest in the property, and she being a third party, is not entitled to file any application under O. 21, R. 90, C.P.C.
According to the auction-purchaser, her (Chandra''s) so called interest is not affected by sale, for, she had no interest at all. The main reason for
such contention was. even though she might be the purchaser from the Administrator, she had not taken a sale deed from the Administrator and,
therefore, her right cannot be recognised by a Court of Law. Since the application is filed by a third party who has no interest in the property, mere
pendency of that Application will not give a right to the judgment-debtor to move an application under O. 34, R. 5, C.P.C. It is further contended
that once the application filed by Chandra has been dismissed for non-furnishing of security and the sale was confirmed, the subsequent setting
aside of that order will not efface the earlier confirmation of sale. It is also contended that once the sale has been confirmed and the decree has
been satisfied in O.S. No. 26 of 1965, the Execution Petition in that suit, namely, E.P. No. 62 of 1975 need not be reviewed and nothing more is
to be executed in that case.
By the impinged order, the Court below said that Chandra has got an interest in the property and, therefore, she is competent to file an
application under O. 21, R. 90, C.P.C. It was held that E.A. No. 501 of 1980 is maintainable. But, on merits, the lower Court said that no
grounds have been made out that there was any fraud or irregularity in the conduct of the sale. Therefore, E.A. 501 of 1980 was dismissed. But
there is a finding in that E.A that the application filed by Chandra is maintainable. Against that finding, the auction- purchaser has filed C.M.A. No.
97 of 1984. The lower Court further found that even though the earlier application for accepting the security was dismissed by that Court and in
consequence thereof the execution of sale in this suit is continuing, and once that order has been set aside by the High Court, the order of
confirmation is automatically effaced. If that be so, the second defendant is competent to file the application under O. 34, R. 5, C.P.C. Since the
amount has been deposited for payment to the decree-holder and also the poundage, the lower Court said that E.A. 224 of 1981 has to be
allowed. C.R.P. No. 592 of 1984 is filed against that order.
The Executing Court further found that in view of the judgment in CM.A. No. 227 of 1979, the earlier order in execution stands vacated and,
therefore, the execution has to be revived. E.P. No. 62 of 1975 was directed to be restores file. It is against that order. C.R.P. No. 591 of 1984 is
filed.
After these orders were passed, it is sold that the decree-holder in O.S. No. 1971 filed an application stating that the amount deposited in that
case may be allowed to be realised by issuing the cheque.
The lower Court, by a separate order said that in view of the pendency of the Revision before this Court, a cheque need not be issued The
same is challenged in C R.P. No. 1135 of 1990.
The following submissions were made by the revision petitioner, who is also appellant on C.M.A. No. 97 of 1984:- 1) The purchaser from the
Administrator, namely, Chandra, who is the second respondent in C.R.P. Nos. 591 and 592 of 1984 and who is the first respondent in C.M.A.
No. 97 of 1984, is not competent to file E.A. 501 of 1980. for setting aside the sale, the main reason being that though she may be a purchaser,
the principles of Court-sale are not applicable, and, unless a sale deed is taken from the Administrator and registered in accordance with
Registration Act. The right cannot be recognised. Therefore, she has as right, title or interest to file an application for sating aside the sale. 2) If the
second respondent as no legal right to file an application under O. 21 R. 90. C.P.C. and when her application has been dismissed, consequent of
her failure to furnish security and the sale is confirmed, merely because it is restored pursuant to the order of this Court, the will not make the
already confirmed sale invalid. If so, the judgment debtor, i.e., the second defendant also cannot file an application under O. 34, R. 5, C.P.C. to
have the sale set aside. According to him, when an application under O. 34, R 5 C.P.C. was filed, the sale was already confirmed
As against the said contention, learned counsel for Chandra as well as the judgment-debtor contended that as per the provisions of O. 21, R.
90, C.P.C., even pecuniary interest is sufficient and the Court need only consider whether by sale the interest of any person is affected. According
to the learned counsel, it is not the interest in the property that has to be considered, and if so, Chandra, being the purchaser from the
Administrator, is competent to file the application. If she is competent to file the publication, the subsequent application under O. 34, R. 5, C.P.C.
is also maintainable when the same is filed along with the second defendant in the suit.
The first question to be considered in this case is, whether the second respondent is entitled to file an application under O. 21, R. 90, C.P.C.
Learned counsel for the petitioner contended that the finding of the lower appellate Court that the sale deed is not necessary for getting title by sale
conducted by an Administrator is not correct According to learned counsel, the sate by Administrator is not a Court-sale, and the sale was also
not conducted pursuant to an Order of Court. An Administrator or Receiver is appointed only to manage the property and any sale by him is an
exercise of that Power of Management, though a permission is required from Court If the sale by the Receiver is not equivalent to a Court-sale, the
provisions of the Transfer of Property Act as well as Indian Stamp Act will have to be complied with and a regular sale deed as contemplated
under S. 54 of the Transfer of Property Act also has to be obtained. Till then, the purchaser cannot say that she has obtained title to the property.
The following decisions have been cited by learned counsel in that regard. Abdul Hashim Vs. Amar Krishna Saha, Pinnamameni Basava Sankaram
by mother and guardian Rattamma Vs. Garapati Narasimhulu and Others, , Kamsala Narasappa Vs. Hussain Sab and Others, , Bank of Bihar
Ltd. Vs. Dr. Damodar Prasad and Another, and Mazharul Islam and Others Vs. Khacher Bux and Another,
In Abdul Hashim Vs. Amar Krishna Saha, , it was held that ''the title of a purchaser of land from an Official Receiver, appointed under the
provisions of the Provincial Insolvency Act, required to be perfected by a proper conveyance executed by the Official Receiver and duly
registered, and there is nothing to exempt such a conveyance from the operation of S. 54, of the Transfer of Property Act''. (Emphasis).
In Pinnamameni Basava Sankaram by mother and guardian Rattamma Vs. Garapati Narasimhulu and Others, , a larger Bench consisting of five
Judges of this Court, considered a similar question. Four learned Judges held that ''a sale by an Official Receiver of the insolvent''s property is not a
transfer contemplated by operation of law, nor it is a transfer by a decree or order, and even though the property vests in a Receiver in insolvency
proceedings, when a Receiver transfers the property to an alienee, the alienation is a voluntary transfer and is as much an act of parties as any
transfer by a private individual.
In Kamsala Narasappa Vs. Hussain Sab and Others, it was held that ''the Official receiver is not a Civil Officer and hence a transfer deed
executed by the Official Receiver in pursuance of an auction sale held by him is not exempt from registration under S. 17(2) (xii) of the Registration
Act''.
In Jibon Krishna Mukherjee and Another Vs. New Beerbhum Coal Co. Ltd., , the question raised for consideration was, whether a sale by a
Receiver is liable to be set aside under O. 21, R. 89, C.P.C. Their Lordships held thus:-
Where the Court appoints a Receiver and gives him liberty to sell the property the Receiver may either sell the property and thereby realise the
money for the satisfaction of the decree, or he may, even without selling the property, seek to satisfy the decree by the collection of rents due from
the property or other ways open to him under the law. In such a case it is difficult to hold that by the very appointment of the Receiver clothing him
with the power to sell the property if he thought it necessary to do so, the Court has ordered the sale of the said property within the meaning of O.
21, R. 82, C.P.C. Further, as the provisions of R. 66, O. 21 are inapplicable to sales held by Receivers, it is obvious that the second condition
prescribed by R. 89 (1)(b) is equally inapplicable and it is undoubtedly one of the two essential conditions for the successful prosecution of an
application under R. 89 of O. 21. This fact clearly emphasises the inapplicability of the whole Rule to sales held by receivers"".
Similar is the case reported in Mazharul Islam and Others Vs. Khacher Bux and Another, wherein the administration was in respect of an evacuee
property. It was held that ''when the Custodian sells the evacuee property under S. 10 (2)(b), prima facie the provisions of the Transfer of
Property Act would apply. So the sale of property worth more than Rs. 100/- must be in writing and must also be registered, and if the property is
less than Rs. 100/-, it may be either by a registered instrument or oral sale, or by delivery of possession. In that case, their Lordships followed an
earlier decision of this Court reported in Kamsala Narasappa Vs. Hussain Sab and Others, ).
From these decisions, it is clear that the sale by an Administrator or Receiver cannot be treated as a Court sale. The person who claims title to
the property on the basis of such sale can claim absolute title or perfect his or her title only on the basis of a registered instrument as stated in S. 54
of the Transfer of Property Act. In that view, it cannot be doubted that Chandra, who is the second respondent in the revision Petitions cannot get
title to the property. The finding of the lower Court equating the sale by Receiver with that of a Court sale is, therefore, not correct. That argument
of the learned counsel for the petitioner is, therefore, well-founded.
Merely because Chandra did not gel title to the property, can she be said as a person disentitled to file an application under O. 21, R. 90,
C.P.C., is the question that has to be considered.
The relevant portion of O. 21, R. 90, C.P.C., after its Amendment under Act 104 of 1976 reads thus:-
Where any immovable property lias been sold in execution of a decree, the decree-holder, or the purchaser, or any other person entitled to share
in a rateable distribution of assets, or whose interests are affected by the sale, may apply to the Court to set aside the sale on the ground of a
material irregularity of fraud in publishing or conducting it"".
(Emphasis supplied)
What is meant by ''interest'' for the purpose of O. 21, R. 90, C.P.C.? According to decided cases, it may be an interest as that of a mortgagee
or any pecuniary interest in respect of the property. It covers every sort of interest recognised by law, proprietary, possessory and pecuniary. If
any interest that is recognised by law is affected by the sale, the person so affected is competent to file at application under O. 21, R. 90, C.P.C.
Even though the second respondent may not have perfected title, can she be said as a person having no interest in the property, or whether her
claim is not ''interest'' in the property which is affected by the sale is the question to be considered.
Before going to the settled position of law, I have already said that the Order of the Court dated 15.2.1977, which I have referred to earlier is
irrelevant. It was the auction purchaser who filed objections stating that the sale in favour of the second respondent should not be confirmed
Rejecting his objections, the Court directed that the second respondent is the highest bidder and that she has paid the amount and no reason is
stated as to why the sale should not be confirmed His application was dismissed and the sale by the Administrator was confirmed by that Order
Whether that Order can be treated as an ''interest in the property, is also to be considered In the connection, it may also be noted that before the
auction, she was in possession of the property as a lessee under the Administrator It is now admitted that the Administrator has also been
discharged and she is in possession of the property on the date when she filed the application under O. 21, R. 90 C.P.C. On the basis of the
Order dated 15.2.1977 along with her continued possession, before the date of sale in this case, it cannot be doubled that she has got some right
over the property that (sic) may be imperfect. In one of the earliest decisions of a Division Bench of the Patna High Court reported in AIR 1919
Pat 127 (Brij Kishore v. Pratan Narain), their Lordships considered whether a Hindu reversioner can file an application to set aside the sale. It is
not disputed that a Hindu reversioner has no right over the property so long as the widow is alive. Considering the same, their Lordships compared
the earlier CPC and also the procedure after 1908. While considering the same, their Lord ships said thus:-
Under Sec. 311 of the Code of 1882, the reversioner would have been no less competent to apply is set aside the sale; for that section, too,
conferred the power to do so upon a person ''whose immovable property has been sold O. 21, R. 90 of the present Code goes, in my opinion still
further and the words ''whose interests are affected by the sate'' would seem to include not only a reversioner but possibly also persons who have
no interest in the property itself, such as persons entitled to specific performance under a contract of sale or licensees.
(Emphasis)
There, the Lordships of the Patna High Court did not finally decide as to what is the scope of ''interest''.
In Dhirendra Nath Roy Vs. Kamini Kumar Pal, a Division Bench of that High Court held thus:-
Though a decree holder has lost his right to share in the rateable distribution of the assets he is still a person whose interests are affected by the
sale and therefore he is entitled to maintain an application. It cannot be said that an attaching creditor has no interest in the sale of the property or in
the properly itself. ''Interest'' need not necessarily be some sort of proprietary or possessory title. It may be pecuniary interest"".
The above decision was cited before a learned Judge of this Court who decided a similar case in Narayanan, minor by next friend Palani Goundan
Vs. Pappayi alias Karuppayi, to contend that attachment by itself will not create any interest. In spite of the same, the application was held to be
maintainable. In that case, the applicant was a purchaser of one item of property which was sold in auction.
In a Full 3ench decision of this Court reported in Ayyappa Naicker Vs. Kasiperumal Nayakar and Others, , the decision in Narayanan, minor
by next friend Palani Goundan Vs. Pappayi alias Karuppayi, was approved. The Full Bench said,
'' The words whose interests are affected by the sale are not limited to refer only to a person having a proprietary or possessory title in the
property, but are intended to apply also to a person whose pecuniary interests are affected by the sale The Legislature intended to confer the right
to apply on any one who is directly and immediately affected by the sale It is true that a person who attaches before judgment is not a secured
creditor in ordinary sense, but it is clear that he has some interest in the property A person who has obtained an attachment before judgment is
directly and immediately affected in such circumstances, and therefore, is within O. 21, R. 90, and can apply under it. The fact that he has not
obtained a decree at the time he filed his application does not make any difference. If he obtained a decree before making the application, his
position is, of course, strengthened, but the attachment before judgment is sufficient in itself to bring him within the category of persons whose
interests are affected by the sale''.
In another Full Bench decision of our High Court reported in T.S. Sailappan Vs. Subbiah Pillai and Others, their Lordships said,
The words of Order 21, Rule 90, C.P.C. are wider than those in Order 21. Rule 89, C.P.C., which enables only a person ""holding an interest"" in
the property sold, for applying to set aside the same. Thus, while R. 89 requires that the applicant should have an interest in the property, it would
be sufficient for the purpose of Rule 90, C.P.C., if the applicant''s interests are affected by the sale. A person charged with possession of the
property and who has an interest in retaining such possession will prima facie come under this provision"".
(Emphasis)
The principles enunciated in the above decisions of this Court were reiterated by a learned Judge of this Court reported in AIR 1975 Mad 36
V.A. Narayana Raja Vs. O.RM.M.SV.M. Meyyappa Chettiar (died) and Others,
In view of these settled principles, even though the second respondent may not have perfected her title by getting a sale deed, she being in
possession and the sate in her favour has been confirmed by an Order of Court and also as a person interested in retaining her possession, she will
be competent to file an application under O. 21, R. 90, C.P.C.
One more circumstance that may also be considered at this junction is, the auction-purchaser''s wife also filed a suit as O.S. No. 15 of 1973.
She was also a mortgagee. Property was brought to sale, and later it was the very same second respondent who paid the entire amount to the
auction purchaser''s wife and full satisfaction was entered. If payment could be made by her and the Court also recorded full satisfaction, it follows
that either she is a person interested in discharging a decree debt or is a representative of the judgment debtor therein. In either way, by discharging
the debt, the decree-holder, who is none other than the auction purchaser''s wife also recognised her interest in the property and not as a volunteer.
It is also not disputed that pursuant to the sale by the Administrator, proceedings were initiated by Tashildar, Kovilpatti, and patta was also
given to the second respondent, recognising her as the title holder. By getting a patta, it should not be understood that she has got absolute title on
the basis of a conveyance. These documents will be taken as a piece of evidence to show that she is interested in retaining the possession, though
her claim is that of a title-holder. When this Court recognised even an attaching creditor as a person ""interested'' and competent to file an
application under O. 21, R. 90, C.P.C. (though the attachment does not create any interest in the property), the case of the second respondent in
these Revisions is much stronger. The sale in her favour has been recognised by Court and she has paid the full consideration. She is therefore, in a
better position and if the Court sale is allowed to stand, she will be dispossessed, and even the sale by the Administrator will be of no use.
Learned counsel for the petitioner argued that since no document has been taken from the Administrator, she has no interest in the property or
that her interest is not affected by sale cannot be accepted.
If she is competent to file an application under O. 21, R. 90, C.P.C., naturally, the sale cannot be confirmed without disposing of that
Application. O. 21, R. 92, C.P.C. says that ''Where no application is made under R. 89, R. 90 or R. 91, or where such application is made and
disallowed, the Court shall make an order confirming the sale, and there upon the sale shall become absolute''. So, when an application is made
under R. 90, the sale cannot be confirmed. In this case, along with the application which was filed in time, E.A. 104 of 1978 was also filed to
dispose with the furnishing of security. Only if that application is allowed, the subsequent application under O. 21, R. 90. C.P.C. could be
registered and numbered. The Court dismissed E.A. 104 of 1978 Naturally. It refused to take notice of the application under O. 21, R. 90,
C.P.C. which in effect amounts to dismissed A Revision was taken before this Court is C.R.P. No. 1631 of 1978. The order was set aside and
the matter was remanded. Thereafter, a fresh application was filed as E.A. No. 110 of 1979 offering third party security. The same was also
dismissed. Subsequently, C.M.A. No 227 of 1978 was filed before this Court. The same was also said aside and the executing Court was
directed to reconsider the same. In the mean while. Which E.A. 110 of 1979 was dismissed, on 26.4.1979. the Executing Court confirmed the
sale of C.M.A. No. 227 of 1979, when the Order was set aside, and that was reconsidered by the Executing Court, the security offered was
accepted But is the time when the security was accepted and the application under O. 21, R. 90, C.P.C. was restored to file and numbered as
E.A. 501 of 1980, the sale had already been confirmed. What is the consequence of such confirmation, is to be considered All decided cases say
that the confirmation is of no consequence.
In one of the earliest decision of the Court reported in 49 L.W. 158 (Marudamuthu Mudaliar v. H.K. Venkatarama Ayyar), the question
raised was, where an application to forth security is dismissed, whether an appeal is maintainable from that Order. The Court held thus
Where, an application having been made under Order 21. Rule 90, of the CPC setting aside a Court-sale, the Court ordered the applicant to
furnish security by depositing the sale amount in cash, and on the applicant tendering a draft bond offering immovable property as security, the
Court decide to accept it and rejected the application under Order 21, R. 90
In AIR 1934 134 (Privy Council) , the question that arose for consideration was, when docs a sale of come absolute for the purpose of taking
position. In construing the same, their Lordships said thus:-
In construing the meaning of words ""when the sale becomes absolute"" in Art 180 regard must be had not only to the provisions of O. 21, R. 92
(1) but also to the other material sections and orders of the Code including those which relates to appeals from orders made under O. 21, R. 92
(1). When therefore there is an appeal from an order of the Judge disallowing the application to set aside the sale, the sale will not become
absolute within the meaning of Art. 180 until the disposal of the Appeal, even though the Subordinate Judge may have confirmed the sale, as he
was bound to do when he decided to disallow the above mentioned application"".
In view of the decision reported in 49 L.W. 158 (supra) and also the decision of the Privy Council cited supra, the decision in C.M.A. 227 of
1979 must be construed as one refusing to set aside the sale, and any confirmation between by the executing Court will be of no value.
In 1970 K.L.T. 1078 (Kunjukrishnan V. Viswanathan) also, a Division Bench of the Kerala High Court considered this point and held thus:-
The order confirming the sale is a dependent order depending upon the dismissal of the application under Rr. 89, 90 or 91 and if, therefore, the
said dismissal is set aside and application is restored, the confirmation already made would become ineffective and such order of confirmation
should be treated as ineffective or automatically vacated"".
In State Bank of Travancore Vs. Mytheen Kannu Mastan Kanju, a Division Bench of the Kerala High Court held thus""-
Where an application under R. 90 of O. 21, Civil P.C. to set aside the sale dismissed by the Executing Court was directed by the appellate Court
to be restored and heard on merits and it was accordingly done and the application was again dismissed, there should be a fresh order confirming
the sale in terms of R. 92. The view that the earlier order of confirmation automatically got revived on the dismissal of the application was not
correct"".
In view of these decisions, even though there is an order confirming the sale by the executing Court, since subsequent to that Order, when the
application under O. 21, R. 90, C.P.C. was directed to be restored and registered, the confirmation gets automatically vacated. The application
under O. 21, R. 90, C.P.C. filed by the second respondent is to be deemed to be pending for all purposes and the sale did not become absolute.
The contention of the petitioner that the application by the second respondent is by a stranger riot having any interest, or her interests are not
affected by the sale, having been found against, the sale also could not be confirmed till her application is finally disposed of That application was
finally disposed of only by the impugned order now under challenge.
Assuming that the second respondent is not affected by the sale, how does the argument advance the case of the petitioner has also to be
considered.
When the second respondent filed an application under O. 21, R. 90, C.P.C. along with an application to dispense with the furnishing of
security, the matter could have been agitated before this Court at least when it came twice in C.R.P. 1631 of 1978 and C.M.A. 227 of 1979.
Even though such an argument was put forward, this Court directed the Executing Court to consider the matter afresh. That means, even the
question whether her interests are affected by the sale could be decided only when her application was being disposed of. Under O. 21, R. 90,
C.P.C., there is a statutory bar to confirm the sale when an application is pending for setting aside the same. It docs not say that it is qualified to
any particular application. When the question whether the sale has affected the interest of any person is also decided along with the main relief to
be granted in the application, till then, there cannot be any question of confirmation of sale. The argument of the counsel that the sale which was
confirmed on 26.4.1979 will not get set aside or automatically vacated since the second respondent was not competent to file the application, is
not correct and the same is against the provisions of the Statute. The Court should only consider whether there is an application for setting aside
the sale or not. The confirmation or other questions consequent on the sale will be subject to the result of that application. Further, the confirmation
dated 26.4.1979 was consequent on the dismissal of E.A. 104 of 1978 and also E.A. 110 of 1979. When these Orders were challenged before
this Court and the same were set aside, the order of confirmation which was also only a dependent Order, also will become automatically vacated.
If any Authority is required for this position, see the decision reported in Varadarajan Vs. Muthu Venkatapathi Reddy and Others, . In that
decision, their Lordships followed an earlier decision of this Court and also that of the Allahabad High Court and held thus:-
...Even if that principle of dependent orders and decree laid down in ''Shama Purshad Roy Chowdhury''s case cannot be held to be completely
applicable to cases arising under O. 21, R. 90, would make the confirmation already made ineffective. Such an order of confirmation may be
treated as ineffective or automatically vacated as observed by the learned Judges in Nidamarti Venkata Narasimham Vs. Pogaku Nagojirao, or
even may be considered to be null and void as held by the Allahabad High Court in AIR 1934 Alla 433, the net result being such that order
continues to have no legal effect or force"".
The said decision was followed by the Kerala High Court in 1970 K.L.T. 1078 (supra) and also in State Bank of Travancore Vs. Mytheen Kannu
Mastan Kanju,
If the application under O. 21, R. 90, C.P.C. is pending, the subsequent application, namely, E.A. 224 of 1981 filed by the second defendant
along with his wife, second respondent, under O. 34, R. 5, C.P.C. is also perfectly maintainable. The scope of O. 34, R. 5, C.P.C. read along
with O. 21, R. 90, C.P.C. has been considered in detail by the Supreme Court in Maganlal Vs. Jaiswal Industries, Neemach and Others, . In
paragraph 8 of the judgment, their Lordships approved a judgment of this Court reported in 1975 11 MLJ 494 = 88 L.W. 477 (S.V. Ramalingam
v. K.E. Rajagopalan) and also M. Sevugan Chettiar and Another Vs. V.A. Narayana Raja and Others, . In paragraphs 8 to 14, their Lordships
held thus:-
A similar view was taken by this Court in Sri Ranga Nilayam Rama Krishna Rao Vs. Kandokori Chellayamma Alias Mangamma and Another,
where it was held that when appeal is filed against an order to set aside an execution sale under O. 21, R. 90 of the Code no finality can be
attached to the Order confirming the sale until the appeal is decided. In S.V. Ramalingam and Others Vs. K.E. Rajagopalan and Another, the
question came up directly in connection with the applicability of O. 34, R. 5 itself which conceits plates payment into Court ""on or before the day
fixed or at any time before the confirmation of a sale in case too in pursuance of a final decree passed in the it half the mortgaged property was
sold and the application made by the mortgagors for setting aside the sale were dismissed and the sale was confirmed and the sale certificate was
also engrossed on stamp papers the mortgagors filed an appeal against that order before the High Court and during the pendency of the
application, application under O. 34, R. 5 was filed for redemption of mortgage. This application was opposed interred the ground that such an
application could not lie after the sale had been confirmed by the lower Court With repelling the objection of the auction purchase and holding that
the judgment debtors were entitled to benefit of O. 34, R. 5 of the Code it was held by Majestic S. Natarajan (as his Lordship then was):
The confirmation of a sale subsequent to the its missal of a petition under O. 21, R. 90 cannot in reality alter the situation when a mortgagor-
judgment debtor has preferred within time an appeal against the dismiss all of his petition under O. 21, R. 90. Though the confirmation of the sale
does take the auction purchaser If further than before the confirmation of the sale, the affirmation by itself, is in one sense, inchoate The affirmation
gives the sale only viability but does not render the sale an indefeasible one, till such time as the appeal preferred by the mortgagor against the
validity of the sale remains indisposed. In that sense, the affirmation effected by the executing Court may became final as far as the executing Court
is concerned, certainly does not stamp the transaction with irremeable finality when alone the rights of parties gel crystallised beyond replacement.
Consequently, the appeal preferred by the judgment debtor has the effect of derig a sale and its confirmation feudal and nebulous. It, therefore,
follows that the finality of the sale is soldered at large before the appellate Court in appeal and as such, the petitioners will he entitled to exercise
and right conferred on them under O. 34. R. 5 to redact the mortgage"".
The same view was reiterated in almost an identical case by a Bench of the Madras High Court as M. Sevugan Chettiar and Another Vs. V.A.
Narayana Raja and Others, . It was held that so long as there is no confirmation of sale in the eye of law and mailer was sub judice in appeal time
was available for the judgment debtor to make the deposit under O. 34, R. 5 of the Code and the proceeds of deposit could be worked out until
the confirmation of sale reaches the finality.
S. 60 of the Transfer of Property Act, confers on the mortgagor a right to redeem a mortgage. In so far as it is relevant for the purpose of these
appeals the said section reads as here under: -
Right of Mortgagor to Redeem: At any time after the principal money has become due, the mortgagor has a right, on payment or tender, at a
proper time and place, of the mortgage money, to require the mortgagee (a) to deliver to the mortgagor the mortgage deed and all documents
relating to the mortgaged property which are in the possession or power of the mortgagee, (b) where the mortgagee is in possession of the
mortgaged property, to deliver possession thereof to the mortgagor, and (c) at the cost of the mortgagor either to re- transfer the mortgaged
property to him or to such third person as he may direct, or to execute and (where the mortgage has been effected by a registered instrument) to
have registered an acknowledgement in writing that any right in derogation on his interest transferred to the mortgagee has been extinguished.
Provided that the right conferred by this Section has not been extinguished by act of the parties or by decree of a Court"".
In AIR 1934 205 (Privy Council) in a suit filed for redemption of a mortgage a decree was passed containing the provision that in case of default
by the plaintiff in payment his case will stand dismissed. Payment as contemplated by the decree was, however, not made and subsequently a
second suit for redemption was filed It was contested inter alia on the ground that in view of the non- payment of the decretal amount the previous
suit stood dismissed and on account of the dismissal of that suit the subsequent suit was not maintainable inasmuch as right of redemption stood
extinguished. The Privy Council after making reference to the Proviso to S. 60 of the Transfer of Property Act rejected the aforesaid objection and
held:
The right to redeem is a right conferred upon the mortgagor by enactment, of which he can only be deprived by means and in manner enacted for
that purpose, and strictly complied with. In the present case the only basis for the claim that the right to redeem has been extinguished is S. 60, but
in their Lordships'' view the old decree cannot properly be construed as doing that which it does not purport to do viz. as extinguishing the right to
redeem"".
This question came up very recently before this Court in Mhadagonda Ramgonda Patil and Others Vs. Shripal Balwant Rainade and Others, The
mortgagors in that case filed a suit for redemption and obtained a final decree for sale of the mortgaged property. They, however, did not execute
that decree and allowed the same to be time-barred. Subsequently, a second suit for redemption was filed claiming that the mortgage still subsisted
and the mortgagors were entitled to redeem the same and get possession of the mortgaged property. The suit was contested inter alia on the
ground that as the mortgagors did not pay the decrial dues under the decree passed in the previous suit their right of redemption had been
extinguished. The aforesaid plea raised in defence was repelled by the trial Court and the suit for redemption was decreed. The defendants
preferred an appeal against that decree before the High Court and raised a similar contention as was their defence in the trial Court. It was held by
the High Court that in spite of the fact that in the earlier suit a preliminary decree and final decree were passed and the mortgagors did not redeem
the mortgages by depositing the decretal dues, still the right of redemption was not extinguished. The findings of the High Court aforesaid with
regard to the maintainability of the second suit for redemption were challenged by the defendants before this Court and it was reiterated by their
learned counsel that second suit was not maintainable. While repelling this submission and interpreting the provisions to S. 60 of the Transfer of
Property Act it was held: (1989 SCC p.303, para 12)
It is thus manifestly clear that the right of redemption will be extinguished (1) by the act of the parties or (2) by the decree of a Court. We are not
concerned with the question of extinguishment of the right of redemption by the act of the parties. The question is whether by the preliminary
decree or final decree passed in the earlier suit, the right of the respondents to redeem the mortgages has been extinguished The decree that is
referred to in the Proviso to S. 60 of the Transfer of Property Act is a final decree in a suit for foreclosure, as provided in sub-rule (2) of R. 3 of
O. 34 and a final decree in a redemption suit as provided in O. 34, R. 8(3)(a) of the Code of Civil Procedure. Sub-rule (2) of R. 3, inter alia,
provides that where payment in accordance with sub-rule (1) has not been made, the Court shall, on an application made by the plaintiff in this
behalf, pass a final decree declaring that the defendant and all persons claiming through or under him are debarred from all right to redeem the
mortgaged property and also, if necessary, ordering the defendant to put the plaintiff in possession of the property. Thus, in a final decree in a suit
for foreclosure, on the failure of the defendant to all amounts due, the extinguishment of the right of redemption has to be specifically declared.
Again, in a final decree in a suit for redemption of mortgage by conditional sale or for redemption of an anomalous mortgage, the extinguishment of
the right of redemption has to be specifically declared, as provided in clause (q) if sub-rule (3) of R. 8 of O. 34 of the Code of Civil Procedure.
These are the two circumstances (1) a final decree in a suit for foreclosure under O. 34 R. 3(2), and (2) a final decree in a suit for redemption
under O. 34, R. 8 (3)(a) of the CPC when the right of redemption is extinguished"".
It was further held that in a suit for redemption of a mortgage other than a mortgage by conditional sale or an anomalous mortgage, the mortgagor
has a right of redemption even after the sale has taken place pursuant to the final decree, but before the confirmation of such sale. In view of these
provisions the question of merger of mortgage debt in the decretal debt does not arise at all.
In this view of the matter we are of the opinion that in case the provisions of Order 34, Rule 5 of the Code are held to be applicable to the facts of
the instant case appropriate relief can be granted thereunder as the order of confirmation of the sale passed by the High Court in favour of first
purchaser has not become absolute due to the pendency of these appeals against that Order nor has the right of redemption of Maganlal yet
distinguished"".
The aforesaid decision was followed by the Supreme Court again in New Kenilworth Hotels (P) Ltd. Vs. Ashoka Industries Ltd. and Others,
Since I have extracted the decisions of the Supreme Court and also this Court, I do not think it is necessary to refer to the decisions of other
High Courts, except for stating the Citations. The other decisions on this point are; Kaliammal and Others Vs. S.A.S. Alagappa Chettiar and
Others, ), V.S. Subramania Asari Vs. Ramaswami Pillai, 1967 2 M.L.J. 260 = 80 L.W. 124 (Ramathal and others v. Nagarathinammal and
others) and N. Krishnamoorthy Vs. N.M.A.R.H. Ramaswamy Chettiar (died), P.S.V. Sevugan Chettiar and another, .
If, on the basis of these judgments, it cannot be doubted that so long as the sale has no been confirmed, the defendant in the suit was
competent to file an application under Order 34 Rule 5, C.P.C. As per that Rule, the applicant could be filed at any time before confirmation sale
from barring the mortgagor from redeemed the property.
Counsel for the petitioner contend that it is not the mortgagor (second defendant who has deposited the amount, and it is his case that they had
no funds and they wanted only they alienees or persons claiming under them to deposit the amount. This, according to learned counsel, is not
sufficient compliance of Order 34 Rule 5, C.P.C. Learned counsel submitted that it is only the ''defendant'' who could apply for setting aside the
sale under Order 34. Rule 5, C.P.C. and the benefit cannot be given to any other person lit true that the wording of the Rule says that it is the
defendant who has to deposit the amount and pray for selling aside the sale. In the application E.A. 224 of 1981, the second defendant along with
his wife, has stated that they are depositing the amount, Even if the defendant is not having the funds, under his directions and on his behalf who the
amount is deposited, that will be sufficed compliance of Order 34, Rule 5, C.P.C., for the person who applies will be considered as agents the
defendant. When a deposit is made on behalf of or on the direction of the defendant, the deposit is made only in his name, and that will be sufficient
compliance of Order 34. Rule 5, C.P.C. in that contention of the learned counsel for the petitioner also cannot be accepted
In view of my conclusion of that the second respondent''s interest is also affected a she is competent to file an application under O. 21, R. 90,
C.P.C., and also in view of my finding of E.A. 224 of 1981 filed by the second defendant along with his wife, is proper and maintainable it follows
that C.R.P. No. 592 of 1984 are C.M.A. No. 97 of 1984 are only to be dismissed C.M.A. No. 97 of 1984 is not maintainable for more than one
reason That appeal is filed against the Order in E.A. No. 501 of 1980. which is an placation under O. 21, R. 90, C.P.C. The same is dismissed in
favour of the revision petitioner But there is a finding that the second respondent is competent to file an application. The appeal is preferred against
that finding only. In the decision reported in (1995) 6 S.C.C 723 = Deva Ram and Another Vs. Ishwar Chand and Another, , in paragraph 27 of
the judgment, at page 741 of S.C.C. their Lordships said thus:-
Thus, an appeal does not lie against mere findings'' recorded by a Court unless the findings amount to a ''decree'' or ''order''. Where a suit is
dismissed, the defendant against whom an adverse finding might have come to be recorded on some issue has no right of appeal and he cannot
question those findings before the appellate Court. (See Smt. Ganga Bai Vs. Vijay Kumar and Others,
In AIR 1922 241 (Privy Council) , it was observed as under:
Their Lordships do not consider that this will be found an actual plea of res judicata, for, the defendants, having succeeded on the other plea, had
no occasion to go further as to the finding against them; but it is the finding of a Court which was dealing with facts nearer to their ken than the fads
are to the Board now, and it certainly creates a paramount duty on the appellants to displace the finding, a duty which they have now been able to
perform"".
Similar view was also expressed in an earlier decision in Run Bahadur Singh v. Lreho Koer (1885) ILR 11 Cal 301 (PC). The Oudh Chief Court
in Pateswari Din v. Mehant Sarju Doss AIR 1938 Oudh 18, held that where a decree in previous suit is wholly in favour of a person and gives him
all the reliefs sought for by him, he has no right of appeal against the decree so as to enable him to contest any adverse finding against him in such
suit Hence such adverse finding cannot operate as res judicata as against him in a subsequent suit.
The High Court of Andhra Pradesh in Bansi Lal Batwa v. Lakshminarayan and the Full Bench of the High Court of Patna in Arjun Singh v. Tara
Das Ghosh have taken the view that an appeal would notice against mere adverse finding unless such finding would constitute res judicata in
subsequent proceedings. We are, however, not concerned with this aspect of the matter in the present case, nor are we concerned with the earlier
aspect as the plea of res judicata having not been raised in the written statement the appellant cannot be permitted to raise the plea here"".
C.R.P. No. 591 of 1984 is directed against the Order in E.A. No. 287 of 1981 whereby the executing Court directed to restore the Execution
Petition. In view of the judgment in C.M.A. No. 271 of 1979. the earlier confirmation of sale ordered on 26.4.1979 automatically gets vacated
and, therefore, when E.A. No. 501 of 1980 is to be finally disposed of, the Execution Petition also has to be restored. The Court below followed
only the correct procedure, which cannot be questioned in Revision. Civil Revision Petition No. 591 of 1984 is also without any merit and the
same is therefore dismissed.
We have to consider only the fate of C.R.P. No. 1135 of 1990. That arises from an application filed by the petitioners to release the amount
which was already deposited in Court by the second defendant. The Court simply dismissed the same on the ground of pendency of C.R.P. Nos.
591 and 592 of 1984 and records were also sent to this Court. The judgment debtor has no objection in releasing the amount to the petition
depositors, who are the decree-holders in the case. When the mortgagor has deposited the amount and the person who is entitled to receive the
amount is the mortgagee, and they have applied for the amount, there cannot be any objection for the same. The auction purchaser cannot object
when redemption is sought for by the mortgagor under law. Whatever amount that is legally payable to the auction- purchaser is also deposited.
Under the above circumstances, I do not think that I should set aside the order and remand the Application to the lower Court for fresh
consideration. E.A. No. 476 of 1986 filed by the petitioners in C.R.P. No. 1135 of 1990 will have to be allowed, and I do so accordingly. In the
result, C.R.P. Nos. 591 and 592 of 1984 are dismissed. C.R.P. No 1195 of 1990 will stand allowed. Parties are directed to bear their own costs
in all these cases.