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Uttamchand Milapchand Vs. Balkrishna Ramnath - Court Judgment

LegalCrystal Citation
SubjectProperty;Civil
CourtMumbai High Court
Decided On
Case NumberCivil Revn. Appln. No. 966 of 1958
Judge
Reported inAIR1961Bom224; (1961)63BOMLR186; ILR1961Bom471
ActsCode of Civil Procedure (CPC), 1908 - Order 21, Rules 85 and 86
AppellantUttamchand Milapchand
RespondentBalkrishna Ramnath
Appellant AdvocateM.G. Choudhari, ;R.G. Nandapurkar and ;D.R. Nandapurkar, Advs.
Respondent AdvocateS.G. Deshmukh Ardhapurkar, Adv.
Excerpt:
.....purchaser at a court sale purchaed the property on august 17, 1957, and paid 25 per cent. of the sale price on the same day. on august 29, he applied to the court for extending the time to deposit the balance of the purchase price. the application was granted by the court and he was required to pay the balance on or before september 18, 1957. neither the judgment-debtor nor the decree-holder raised any objection to this application being granted. when the application reached hearing on september 18, 1957, the court refused to accept the deposit and ordered a resale of the property under order xxi, rule 86, of the civil procedure code, 1908. on the question whether the order passed by the court was proper:-;that as the auction purchaser had failed to pay the full purchase price within..........court cannot use inherent power to circumvent the mandatory provisions of the code and relieve the auction purchaser of his obligation to make the deposit of purchase-money under order 21 rule 85 c. p. c.' accordingly, the learned judge refused to accept the deposit of the balance of the purchase price and ordered a re-sale of the property under order 21, rule 86 of the code. it is against this order that the auction purchaser has filed the present revision application in this court.2. it was contended on behalf of the applicant that although the provisions of order 21 rule 85 were mandatory in their character, it was open to the court to extend the time to enable the auction purchaser to pay the balance of the purchase price if both the judgment creditor and the judgment-debtor did not.....
Judgment:

1. This civil revision application is filed by an auction-purchaser of a certain immoveable property belonging to the judgment-debtor in respect of a decree passed against him in suit No. 5/3' of 1956 in the Court of Munsiff at Sailu. On the date of the auction of the property, i. e. on the 17th August, 1957, the property was knocked down to the applicant for Rs. 2500/- and the applicant-paid 25 per cent of that price on the same day. It appears that on 29th August, 1957, he filed an application for extending the time to deposit the balance of the purchase price in Court. It further appears that neither the judgment debtor nor the decree-holder raised any objection to the application being granted by the Court. The application was accordingly granted and the applicant was required to pay the balance of the purchase price into Court on or before 18th September, 1957. It appears, however, that the applicant could not manage to deposit the balance of the purchase price before 18th September, 1957, but when the application reached hearing on the 18th September, 1957, the applicant offered to pay the balance of the purchase price into the Court. By that time, however, it appears, attention of the Court was drawnto the provisions of Order 21 Rule 85 of the Code of Civil Procedure which provides:-

'The full amount of purchase-money payable shall be paid by the purchaser into Court before the Court closes on the fifteenth day from the sale-of the property',

and it was urged that the provisions of that rule were mandatory and that the Court had committed an error in granting the applicant's application for extension of time for the payment of the balance of the purchase price. The learned Judge accepted the contention which was supported inter alia by a decision of the Supreme Court and observed as fol-lows:-

'In the light of these rulings it is concluded that the provision for payment is mandatory and the Court cannot use inherent power to circumvent the mandatory provisions of the Code and relieve the auction purchaser of his obligation to make the deposit of purchase-money under order 21 Rule 85 C. P. C.' Accordingly, the learned Judge refused to accept the deposit of the balance of the purchase price and ordered a re-sale of the property under Order 21, Rule 86 of the Code. It is against this order that the auction purchaser has filed the present revision application in this Court.

2. It was contended on behalf of the applicant that although the provisions of Order 21 Rule 85 were mandatory in their character, it was open to the Court to extend the time to enable the auction purchaser to pay the balance of the purchase price if both the judgment creditor and the judgment-debtor did not object to it. It was further contended that non-payment of the balance of the purchase price within the period fixed by Order 21 Rule 85 only amounted to an irregularity and that it was open to the judgment-debtor to waive irregularity. If, therefore, according to the learned advocate for the applicant, the judgment-debtor did not object to the time being extended, in this case for the auction purchaser, to pay the balance of the purchase price, the validity of the sale could not be said to have been affected at all and, therefore the learned Judge should be directed to accept the payment of the balance of the purchase price in completion of the auction sale.

3. It was on the other hand contended on behalf of the opponent that in Case of mandatory provisions there could never be a question of waiver thereof. No amount of consent either of the judgment creditor or of the judgment-debtor or both could confer jurisdiction upon the executing Court to extend time for payment of the balance of the purchase price by the auction purchaser, if the provisions of Order 21 Rule 85 required that the full purchase price shall be paid within 15 days from the date of the sale and accordiogly, the Court had no jurisdiction to extend the time at all. In support of this contention reliance was placed upon a decision of the Supreme Court in Manilal Mohanlal v. Sardar Sayed Ahmed Sayed Mahmad : [1955]1SCR108 . His Lordship Mr. Justice Ghulam Hasan. who delivered the judgment of the Court observed at page 353, paragraph 8 as follows:.

'The provision regarding the deposit of 25 per cent 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 bepaid within fifteen days from the 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 85J. If the payment is notmade 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).'

4. Then again in paragraph 11 on the same page it is further observed as follows:-

'Having examined the language of the relevant rules and the judicial decisions bearing upon the subject we are of opinion that the provisions oi the rules requiring the deposit of 25 per Cent of the purchase money immediately, on the person being declared as a purchaser and the payment of the balance within 15 days of the sale are mandatory and upon non-compliance with these provisions there is no sale at all. The rules do not contemplate that there can be any sale in favour of a purchaser without depositing 25 per cent of the purchase money in the first instance and the balance within 15 days. When there is no sale within the contemplation of these rules, there can be no question of material irregularity in the conduct of the sale. Non-payment of the price on the part of the defaulting purchaser renders the safe proceedings as a complete nullity. The very fact that the Court is bound to re-sell the property in the event of a default shows that the previous proceedings for sale are completely wiped out as if they do not exist in the eye of law.'

In view of these observations of the Supreme Court it is clear that the provisions of Order 21 Rule 85 as well as Rule 86 are mandatory in the sense that in the event of the auction purchaser failing to deposit the full purchase price within 15 days from the date of the auction sale the Court will have no option but to order a re-sale of the property. This necessarily implies that the Court has no jurisdiction whatever to extend the lime for the payment of the balance of the purchase price as fixed under Order 21 Rule 85 of the Code. Either the purchaser pays the price within 15 days of the sale or he does not. If he pays, the sale would be complete; if he does not pay then, as pointed out by the Supreme Court in the aforesaid decision, there is no sale at all and all the proceedings in respect of the auction sale would Be a nullity. Applying the ratio of that decision to the facts of this case, it is clear that as auction purchaser, who is the applicant in the present revision application, failed to pay the full purchase price within 15 days of the auction sale, there was no sale at all in his favour and, therefore, there was no question of any irregularity in such a sale being waived on account of the consent of the judgment-debtor to the time being extended in favour of the auction purchaser. Following upon the default in the payment of the purchase price as required under Order 21 Rule 85 the Court had straightaway to order resale of the property which the learned Judge in the Court below has done in this case. Accordingly, in my opinion, the order passed by the learned Judge ordering re-sale of the property is perfectly valid.

5. It may be mentioned that the learned advocate for the applicant relied in support of his contentions upon a decision of the Calcutta High Court in Kalipada Mukerji v. Easanta Kumar Dutta : AIR1932Cal126 in which it was observed as follows:-

'When the period prescribed under Order 21 Rule 85 for payment of the balance of purchase-money in respect of Court sale is extended with the Consent of the judgment-debtor and the balance is paid within the time so extended and the sale confirmed thereupon the sale is not a nullity. The judgment-debtor must be taken to have waived the irregularity and the old sale will be treated as a re-sale as required to be held by Rule 86 and as bringing on all the statutory consequences where follow on a sale regularly held by the Court in strict accordance with the provisions of the statute.'

6. It will be observed from this quotation from the judgment in that case that the Court having extended the time for the payment of the balance of the purchase price had actually accepted the money within the extended time and thereafter the sale was actually confirmed. The question then arose as to whether the sale could be said to be valid in the circumstances of that case, in view of the fact that under the provisions of Order 21 Rule 85 of the Code, the Court could not extend the time in favour of the auction purchaser in order to enable him to pay the balance of the purchase price. It was held that the sale having been already confirmed it could be treated as if there was a re-sale under Order 21 Rule 86, because the entire purchase-money was paid up. That is not the case here. The learned Judge in the Court below did not accept the payment of the balance of the purchase price on the date of the hearing of the application. On the contrary, he held that he had no jurisdiction to extend the time for payment of the balance of the purchase price and ordered the re-sale. In my opinion, therefore, the ratio of the Calcutta case cited above has no application to the facts in the present case. On the contrary, the present case falls directly within the observations of the Supreme Court quoted above and, therefore, I have no doubt that the order passed by the learned Judge in the circumstances of the case is perfectly proper.

7. In the result, the application is dismissed and the rule is discharged with costs.

8. Revision dismissed.


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