1. The above first appeal arising in execution proceedings raises an Interesting point under Sections 2 and 3 of the Partition Act, 1893.
2. Under the decree for partition, passed in Special Civil Suit No. 277 of 1972, among the respondents, it was found that it was not possible to partition the property; and hence an application was made on Jan. 9, 1976 for sale of the property under Section 2 of the Partition Act, 1893.
3. The property is house property bearing No. 541 situated at Raviwar Peth In Pune, On the application made by the plaintiff-decree-holder (Ex. 68), an order was passed on Dec. 4, 1976 to hold the sale by public auction of the suit property under Section 2 of the Partition Act, 1893. The sale was held on March 30. 1977 and the appellant happened to be the highest bidder at the said sale.
4. In the meanwhile, on Jan. 7, 1977, defendants 1 and 2, who are respondents Nos. 2 and 6 in the above first appeal, made an application under Section 3 of the Partition Act, 1893; applying for leave of the Court to buy at a valuation the share or shares of the party or parties asking for a sale.
5. The said application was resisted by the plaintiff-decree-holder by contending that the application was not maintainable and was filed In order to protract the proceedings.
6. The learned Second Joint Civil Judge has tried to explain the circumstances in which the present application came to be placed for hearing before him after the auction sale was held. After hearing the plaintiff and the auction purchaser, the learned Judge, by his judgment and order dated Sept, 2, 1977, re-fused to confirm the sale held by the Commissioner, because he allowed the application under Section 3 of the Partition Act, 1893. The said decision is challenged in the above first appeal by the auction purchaser,
7. Mr. Gupte, the learned counsel appearing for the auction purchaser, contended that the learned Second Joint Civil Judge erred in law in holding that the hearing of the application under Section 3 made in the present case was tenable after the Court had ordered sale under Section 2 of the Partition Act, 1893 on Dec, 4, 1976.
8. In support of his above argument, Mr. Gupte relied on the decision of the Madras High Court in Angamuthu Muda-liar v. Ratna Mudaliar, AIR 1925 Mad 1234, where it was laid down by Kumara-swami Sastri and Krishnan, JJ. that the proper time to apply under Section 3 of the Partition Act, 1893 is before a Court makes an order under Section 2. So, according to Mr. Gupte, when under Section 2 sale has been ordered, a sharer cannot apply to have property sold to him at valuation fixed by the Court.
9. The learned Second Joint Civil Judge has cited a number of authorities in support of the view he has taken, and particularly the decision of the Madras High Court, subsequent to the above decision, in Vardaraja v. Chennai Veeri, : AIR1970Mad106 , where a view appears to have been taken that the application under Section 3 could be made at any time before the sale is held, although it is not clear whether they mean by 'the sale is held', 'the sale is confirmed', as Section 7 of the Partition Act requires the sale to be held in accordance with the procedure of the Court, and that procedure requires the sale to be confirmed before the sale can transfer the property so as to entitle the auction purchaser to possession oi the property.
10. Mr. Gupte further submitted that any order for sale made by the Court under Section 2 of the Partition Act is to be deemed to be a decree within the meaning of Section 2 of the Civil P. C., under Section 8 of the Partition Act, 1893. He, therefore, submitted that once an order for sale under Section 2 was made, the learned Second Joint Civil Judge could not make any other order so as to vary it or to nullify it, as has been done in the present case, by ordering a sale under Section 3 of the Act.
11. The material Sections 2 and 3 of the Partition Act, 1893 run as follows:--
'2. Whenever in any suit for partition En which, if instituted prior to the commencement of this Act, a decree for partition might have been made, it appears to the Court that, by reason of the nature of the property to which the suit relates, or of the number of the shareholders therein, or of any other special circumstances, a division of the property cannot reasonably or conveniently be made, and that a sale of the property and distribution of the proceeds would be more beneficial for all the shareholders, the Court may, if it thinks fit, on the request of any of such shareholders interested individually or collectively to the extent of one moiety or upwards, direct a sale of the property and a distribution of the proceeds.'
'3. (1) If, in any case in which the Court is requested under the last foregoing section to direct a sale, any other shareholder applies for leave to buy at a valuation the share or shares of the party or parties asking for a sale, the Court shall order a valuation of the share or shares in such manner as it may think fit and offer to sell the same to such shareholder at the price so ascertained, and may give all necessary and proper directions in that behalf.
(2) If two or more shareholders severally apply for leave to buy as provided in Sub-section (1), the Court shall order a sale of the share or shares to the shareholder who offers to pay the highest price above the valuation made by the Court.
(3) If no such shareholder is willing to buy such share or shares at the price so ascertained, the applicant or applicants shall be liable to pay all costs of or incident to the application or applications.'
12. Considering the two Sections together, in the light of Section 8 of the Partition Act, 1893, which makes the orders passed by the Courts as decrees, I am of the opinion that, in the absence of any words of limitation in Section 3, the section requires to be liberally construed so as to enable the sharers in a partition decree to sell the property among themselves. The terminus a quo in such cases for making an application under Section 3 arises after an application is made under Section 2, requesting the Court to direct a sale.
13. The order directing a sale may be a decree, but it cannot be a final decree, inasmuch as in all court sales, confirmation of the sales is necessary and until confirmation, therefore, the Courthas power to direct a sale. So, that will be the last point of time before which an application could be made under Section 3.
14. However, the Court must be circumspect in granting the request under Section 3, once the request under Section 2 is granted by ordering a sale. Equities in favour of third parties arise, as in the present case, and any orders that may be passed must be so passed as to save those equities.
15. The above view of the interpretation of Section 3 is supported by the decision of the Calcutta High Court in Manik Lal v. Pulin Behari, : AIR1950Cal431 , where Rule P. Mookerjee, J. has fully reviewed all the previous authorities but where the aforesaid decision of the Madras High Court in Angamuthu Mudaliar's case AIR 1925 Mad 1234 does not appear to have been considered. However, that decision was followed by a Division Bench consisting of Rule P. Mookerjee and Lahiri, JJ. in Nitish Chandra v. Promode Kumar, : AIR1953Cal18 , where they have expressly dissented from the decision in Angamuthu Mudaliar's case. They laid down that an application under Section 3 could be made at any time after the request is made under Section 2 and before a sale has actually been held under Section 2.
16. The above view has been accepted by Kailasam, J., as he then was, in P. J. Section Jayarama Chettiar v. D. Annamalai Chettiar, ILR (1966) Mad 530, and by a single Judge of the Rajasthan High Court in Baldeo Das v. Kishanlal .
17. But in none of the above cases, the sale was actually held, as in the present case; and the question which arises in this case is whether, even if actually the sale is held but is not confirmed, an order under Section 3 could not be made. In fact, the application under Section 3 was made on Jan. 7, 1977, more than two months before the auction sale was held. It was the duty of the Court, having regard to the scheme of Sections 2 and 3 of the Partition Act, 1893, either to stay the sale under Section 2 or to decide the application before allowing the sale to be held.
18. Now, however, as a result of the mistake of the lower Court in following the correct procedure, the sale has been actually held. It was the duty of the Court to consider the equities in favour of the auction purchaser also before passing any order under Section 3 of the Partition Act, when he was not made aware of any application under Section 3 pending in theCourt when the Court actually held the auction sale. Such a situation had not arisen in any of the cases cited.
19. In my opinion, however, when liberally construing Section 3, as suggested by the Division Bench of the Calcutta High Court, it is not possible to limit the point of time up to which the application could be made under Section 3 as the time when the sale is actually held. It must be the time when the Court can no longer give any directions of sale under Section 3. It can no longer do so after the confirmation of the sale. Therefore, the time must extend up to the point of tune when the Court confirms the sale which is actually held.
20. The learned Second Joint Civil Judge was, therefore, right in holding that even though the sale was actually held, the application under Section 3 could be considered by him before the confirmation of the sale.
21. However, the learned Judge was not right in not confirming the sale held by the Commissioner and in ordering the repayment of the price received from the appellant before it was clear that the application under Section 3 was not a ruse for protracting the proceedings but was really an effective application. He should have given the applicants under Section 3 sufficient time to effect a sale under Section 3 before ordering the repayment of the price. I am told that the amount is still lying in Court and the stay was ordered by this. Court when admitting the above first appeal.
22. In the circumstances, the second para of the learned Second Joint Civil Judge's order deserves to be deleted and instead it will have to be ordered that the sale should be confirmed in favour of the appellant in the event of the applicants under Section 3 not completing the sale within a reasonable period.
23. In the result, the above first appeal is partly allowed and instead of the order passed by the learned Second Joint Civil Judge, Senior Division, Pune, on Sept. 2, 1977, the following order shall be substituted:--
'In addition to the valuation of the suit property as is found in the auction sale held by the Commissioner, the parties are allowed to adduce evidence, if any, as to the valuation of the suit property on or before Aug. 28, 1978, or on such further date as the learned Second Joint Civil Judge may find it necessary to extend, on which date the valuationof the share (one-sixth) of the plaintiff will be fixed by the Court and thereupon, the sale of the one-sixth share of the plaintiff in the suit property shall be made in favour of either defendant No. 1 or defendant No. 5 who offers to pay the highest price above the valuation made by the Court on the aforesaid date.
The auction sale held in favour of the purchaser-appellant shall be confirmed if the sale under Section 3 is not completed within three months from the receipt of the writ of this Court by the lower Court.'
24. Costs will be costs in the darkhast.
25. In view of the above order, no order is passed on the civil application.
26. Order accordingly.