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Jana Handloom Weaving Factory and Furniture Suppliers and ors. Vs. Laxmi Handloom Factory and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberAppeal No. 489 of 1970
Judge
Reported in(1980)82BOMLR277; 1979MhLJ577
ActsCode of Civil Procedure (CPC) , 1908 - Order 21, Rule 94; Transfer of Property Act
AppellantJana Handloom Weaving Factory and Furniture Suppliers and ors.
RespondentLaxmi Handloom Factory and ors.
Appellant AdvocateK.J. Abhyankar, Adv.
Respondent AdvocateM.L. Dudhat, Adv. for respondent Nos. 1 to 4
DispositionAppeal allowed
Excerpt:
.....declaration and possession as well as injunction - suit was on basis of their title by virtue of sale certificate issued in plaintiff's name - under order 21 rule 94 executing court derives jurisdiction to issue sale certificate to purchaser or in given case to assignee of purchaser - unless conditions referred to in rule 94 satisfied court has no jurisdiction to issue sale certificate - existence of assignment deed is condition precedent for issuing certificate in name of assignee - such an assignment will have to be in accordance with law - in absence of any valid transfer of suit property by method recognised by law sale certificate could not been issued in favour of present plaintiffs - plaintiffs not purchasers of property - sale certificate issued in favour of plaintiffs without..........regular darkhast no. 1058 of 1961 against the firm as well as its partners. in that darkhast the suit property was sold on 22nd january, 1963, which was purchased by one maniklal narayandas pankhewale. according to the plaintiffs viz., laxmi handloom factory the auction purchaser maniklal narayandas had taken three-fourth of the amount from them for payment in court and according to the agreement between them, maniklala narayandas assigned all his rights as the auction purchaser to the plaintiffs and, therefore, ultimately the sale certificate was also issued by the court in their name. the plaintiffs further alleged in the plaint that thereafter they filed miscellaneous application no. 241 of 1966 for getting possession of the suit property. however, the son of defendant no. 4,.....
Judgment:

C.S. Dharmadhikari, J.

1. Defendant Nos. 1 to 6 had incurred some debts from the Koregaon Sand Supply Company and, therefore, the said Company filed a suit against them bearing Regular Civil Suit No. 1237 of 1959 decided on 22nd December, 1960. The decree was for an amount of Rs. 3,864.30 p and as the said amount was not paid the decree-holder filed Regular Darkhast No. 1058 of 1961 against the firm as well as its partners. In that Darkhast the suit property was sold on 22nd January, 1963, which was purchased by one Maniklal Narayandas Pankhewale. According to the plaintiffs viz., Laxmi Handloom Factory the auction purchaser Maniklal Narayandas had taken three-fourth of the amount from them for payment in Court and according to the agreement between them, Maniklala Narayandas assigned all his rights as the auction purchaser to the plaintiffs and, therefore, ultimately the sale certificate was also issued by the Court in their name. The plaintiffs further alleged in the plaint that thereafter they filed Miscellaneous Application No. 241 of 1966 for getting possession of the suit property. However, the son of defendant No. 4, Vishwanath Govind (defendant No. 23) caused unlawful obstruction on 31st October, 1966. In view of this obstruction on they filed Miscellaneous Application No. 519 of 1966 for removal of this obstruction. Both these Miscellaneous application viz., Miscellaneous Application No. 241 of 1966 and Miscellaneous Application No. 519 of 1966 were decided together and in these proceedings they got symbolical possession of that part of the property which was in possession of the tenant i.e. defendant No. 36. However, the obstruction caused by Vishwanath, defendant No. 23 was held to be proper and, therefore, their application for possession was dismissed. After dismissal of the said application the plaintiffs filed the present suit for declaration and possession as well as injunction against the defendants. In substance the present suit was filed by the plaintiffs on the basis of their title by virtue of the sale certificate issued in their name.

2. The defendants resisted the suit filed by the plaintiffs on various grounds. Defendants 1, 3, 4, 5 and 6 contended that the plaintiffs are not the owners of the suit property land they have no right to file the present suit. They further contended that the sale certificates issued in the name of the plaintiffs is ab initio void it being without jurisdiction. So far as the other defendants are concerned, they have challenged the decree for possession and further contended that the debt incurred by defendant Nos. 1 to 6 was Anvyavaharik and, therefore, the decree itself was not binding upon them. On the basis of these pleas raised by the parties the learned Judge of the trial Court framed necessary issues. It appears from the record that no oral evidence was adduced by the parties and the case was decided on the basis of the pleadings as well as the documents filed by the parties. The learned Judge of the trial Court ultimately came to the conclusion that it was Maniklal Narayandas, who had purchased the suit property in the Court auction, held in Regular Darkhast No. 1058 of 1961. He further found that though the defendants had called upon the plaintiffs to produce the deed of assignment if any, the plaintiffs have also refused to produce it and, therefore, the Court further inferred that Maniklal Narayandas had not executed any deed of assignment for transfer of the suit property, in favour of plaintiffs. However, the learned Judge came to the conclusion that the defendants cannot now challenge the sale certificate and the sale certificate is binding upon them. In view of these findings the learned Judge ultimately decreed the suit of the plaintiffs by his judgment dated 20th June, 1970. It is this judgment and decree which is challenged before us in the present appeal by the original defendants.

3. It appears to be an admitted position that before the sale certificate was issued in the name of the plaintiffs they had filed Civil Suit No. 1 of 1964 against Maniklal Narayandas for a declaration and an injunction. In this suit the plaintiffs had claimed a declaration that the plaintiffs are the owners of the amount deposited in Regular Darkhast No. 1058 of 1961 and had further asked for an injunction restraining the defendant from withdrawing that amount or any part of it. To that suit Maniklal Narayandas alone was joined as a party. It appears that by the order dated 28th of September, 1964 the learned Judge granted permission to withdraw the suit with liberty to file a fresh suit and the plaintiffs were directed to pay one-half costs of the defendants. After the withdrawal of this suit the plaintiffs filed another suit against Maniklal bearing Civil Suit No. 15 of 1966. This suit stood rejected by the order dated 31st August, 1966 as Court-fee was not paid. In this suit the plaintiffs had prayed for a declaration that they are entitled to the sale certificate. It is pertinent to note that in these two suits a contention was raised by the plaintiffs that defendant Maniklal Narayandas had agreed to sell the suit property to the plaintiffs for a sum of Rs. 21,300/- i.e. at a profit of Rs. 1000/- to himself and it was also agreed that the amount required to be deposited by the defendants in Regular Darkhast No. 1058 of 1961 should be deposited by the plaintiffs. The plaintiffs further averred in the said plaint that it was agreed by the defendant Maniklal Narayandas that the proceedings of confirmation of sale and possession were to be carried out according to the instructions of the plaintiffs. Therefore, in substance the plaintiffs were claiming declaration in the said suit on the basis of the agreement to sell the suit property to the plaintiffs. It is further an admitted position that no registered document of assignment of sale was, ever, executed by Maniklal Narayandas in favour of the plaintiffs either, before issuance of the sale certificate or even thereafter.

4. After rejection of the plaint in Civil Suit No. 15 of 1966 Maniklal Narayandas and Messrs. Laxmi Handloom Factory filed an application bearing Miscellaneous Civil Application No. 226 for issuing the sale certificate in favour of applicant No. 2, the present plaintiff. Ultimately the learned Judge issued the sale certificate in the name of the present plaintiffs and it is the contention of the defendants before us that this was done without issuing any notice to them. After the sale certificate was issued as already observed certain steps were taken by the plaintiffs for getting possession of the property. However, the defendant resisted possession and ultimately the plaintiff was forced to file an application for removal of obstruction. One of the contentions raised in Miscellaneous Application No. 241 of 1966 was that the plaintiff had no title and he cannot rely upon the sale certificate. While disposing of Miscellaneous Application No. 241 of 1966 the learned Joint Civil Judge, Junior Division, Pune vide the order dated 25th April, 1967 found that there was nothing on record to show that the purchaser has disposed of his interest in the estate purchased by him or has transferred the property in the mode prescribed under the Transfer of Property Act. He further observed that the defendant called upon the plaintiff to produce the deed of assignment as he claim to be the assignee and by Exhibit 24 the present plaintiffs refused to produce it. It is also to be noted that there was a litigation between the auction-purchaser and the applicant in respect of the property purchased at the auction and the litigation does not show that the applicant was the assignee. Therefore, the learned Judge found it difficult to hold that the title of the plaintiff was a good one and that he was entitled to eject the defendant. On this ground, therefore, the application filed by the plaintiff for removal of obstruction was rejected. The claim made by the plaintiff in the present litigation will, therefore, have to be reviewed in this back ground.

5. Mr. Abhyankar, learned Counsel appearing for the appellants contended before us that the present plaintiffs had no title to the suit property at all. He further contended that the claim in suit is based on the sale certificate issued in their favour to which the defendants were not the parties. It is an admitted position that there was no valid assignment in favour of the plaintiff by the purchaser viz. Maniklal Narayandas. It is not the case of the plaintiffs that either before the issuance of the sale certificate or thereafter the plaintiffs purchased the property by a registered sale deed or otherwise in accordance with law. Therefore, according to the learned Counsel assuming that the sale certificate can be issued in favour of an assignee, it can be issued if there is a valid assignment and not otherwise. In substance, therefore, it is the contention of Mr. Abhyankar that in the absence of a valid assignment the sale certificates issued in favour of the plaintiffs is ab initio void and without jurisdiction and, therefore, the plaintiffs cannot base their title on the basis of such void and illegal document. Mr. Abhayankar has also raised a contention before us that the present defendants and particularly defendant Nos. 1 to 6 are entitled to challenge the decree passed in the earlier suit as the said decree is not binding upon them. He also contended that under Order 21, Rule 94 a certificate could be issued only in the name of the purchaser or his legal representative and not in favour of anybody else including an assignee and for this proposition he has relied upon the decision of the Allahabad High Court in Makhan Kela and another v. Baldeo Prasad and other : AIR1938All471 .

6. On the other hand it is contended by Mr. Paranjape, learned Counsel appearing for the plaintiffs that once a sale certificate is issued in favour of the plaintiffs, it is not open to the defendants to challenge the said sale certificate. He further contended that in the present suit neither the parties nor the Court can go behind the sale certificates. Even if it is assumed that the sale certificate was wrongly issued in favour of the plaintiffs, it is merely an irregularity and of an illegality or an act or order which could be said to be without jurisdiction. The Court had jurisdiction to issue the sale certificate in the name of the assignee and, therefore, it on the basis of the admission of Maniklal Narayandas, the certificate is issued in the name of plaintiffs the said certificate is perfectly legal and valid. He further contended that so far as the present defendants are concerned, some of them were parties to the initial suit as well as the execution proceedings and the other defendants are claiming through them and, therefore, the decree and the order passed in the earlier suit or the execution proceedings is binding upon them. He further contended that the sale certificate could be issued in favour of an assignee and in support of this proposition he has relied upon the decisions of this Court in Ganapati Mania Hegade v. Subraya Rayappa Shetti 38 Bom.L.R. 104 as well as the decision of the Allahabad High Court in Pakhoal Singh and others v. Kanhaiya Lal and others : AIR1946All438 and the two decisions of the Madras High Court (1) in A.V. Sreenivaalu Naidu v. V.K. Nataraja Goundan, : AIR1955Mad461 and (2) Seth Mohandas Vasudev etc. v. M.R. Ramamoorthy : (1956)1MLJ493 . He has also relied on a later decision of Mysore High Court in Shivadas Subrao and Co. v. V.D. Divekar and another A.I.R Mys 73.

7. Though a wider proposition was initially advanced by Mr. Abhyankar that under Order 21, Rule 94 a certificate cannot be issued in the name of an assignee, ultimately he has confined his argument to the proposition that assuming that a sale certificate could be issued in the name of an assignee, such a certificate can only be issued if there is a valid assignment viz. assignment in accordance with law. He further contended that in the absence of any valid assignment if a certificate is issued by the Court, then that certificate is ab initio void being without jurisdiction and, therefore, it is open for the defendants to resist their possession by denying the title of the plaintiff who is claiming possession of the property solely on the basis of such a sale certificate. It is not disputed by him that if it is held that issuance of the certificate in favour of the plaintiffs was merely an irregularity, then obviously the order being not without jurisdiction it will be binding upon the defendants as defendant Nos. 1 to 6 were parties to the previous litigation and other defendants are claiming through them. Therefore, the only question which requires consideration in this appeal is to find out as to whether it could be said that the sale certificate issued in favour of the plaintiffs under Order 21, Rule 94 was without jurisdiction.

8. For properly appreciating the controversy raised before us it is necessary to make a reference to Order 21, Rule 94, which reads as under :---

'Rule 94 Certificate to Purchaser. Where a sale of immovable property has become absolute, the Court shall grant certificate specifying the property sold and the name of the person who at the time of sale is declared to be the purchaser. Such certificate shall bear the date the day on which the sale became absolute.''

In Ganapati Mania's Hegade v. Subraya Rayappa Shetti, 38 Bom.L.R. 104, relying upon the provisions of section 146 of the Code of Civil Procedure this Court held that a sale certificate could be issued by the Court direct to the assignee of the auction purchaser, who has in the mean while transferred his right to the assignee. However, it was further observed therein that this is subject to any contrary provisions in the Code or any other law. This Court, therefore, directed while making the rule absolute that on proof of assignment to the applicant, if proof is required the sale certificate should be granted to him. This view taken by this Court was subsequently approved by the Madras and Mysore High Court in the decision referred to herein before. However, in Mohandas v. M.R. Rammoorthy, : (1956)1MLJ493 , the position was clarified by saying that such a subsequent transferee must take the proper sale deed after paying proper stamp duty and should not indulge in such tactics and expect the Court to commit an irregularity or illegality for his sake. In Mysore case there was already a consent decree in the field and on the basis of the said consent decree, which did not require any registration, the sale certificate was issued. So far as the decisions of the allahabad High Court, in Pokhpal Singh and others v. Kanhaiya Lal : AIR1946All438 , or the decision of the Madras High Court. A.V. Sreenivaalu Naidu v. V.K. Nataraja Goundan : AIR1955Mad461 , are concerned, an agency was pleaded and admitted by the parties. For the purpose of issuing a sale certificate on the basis of the representation made by the party, no further registered or written document was necessary. Therefore, obviously all these cases are distinguishable on facts and cannot assist Mr. Paranjape, so far as the facts and circumstances of the present case are concerned.

9. It is no doubt true that if it is held that issuance of the certificate in favour of the plaintiffs was merely an irregularity, then the defendants cannot challenge the said certificate. It is also an admitted position that this is a suit filed by the plaintiffs on the basis of their title. The plaintiffs are claiming title to the suit property solely on the basis of the sale certificate issued in their favour. However, it will not be correct to say that if such a document itself is void ab initio or is a nullity, then also the defendants cannot question the title of the plaintiffs. In this case the plaintiffs are asserting their title on the basis if the sale certificate and are trying to eject the defendants who are in possession. Therefore, a person asserting title has to prove it and it is open to the defendant to allege and prove that so far as the plaintiff is concerned, his title was not good one and on that basis he can protect his possession. See (Shankar Daji Naik v. Dattatraya Vinayak Khanalekar) 23 Bom.L.R. 514. It is the case of the defendants that the plaintiffs have no title to suit property as the sale certificate issued in their name is wholly a nullity and can be ignored for all purposes. It is by now well settled that the order, which is a nullity could be ignored at any stage it being 'nonest'. See (Chestsing v. State of Punjab) : [1977]3SCR369 . If the order issuing the sale certificate is wholly without jurisdiction, then it is not merely an irregularity but an illegality which goes to the very root of the matter and, therefore, the said sale certificate cannot confer any right or interest in the plaintiffs so far as the present suit property is concerned. An order which is void can be directly and collaterally challenged in any legal proceedings. Where as authority which purports to pass an order is acting without jurisdiction the purported order is nullity and it is not necessary for anybody, who objects to that order, to apply to set it aside, He can rely on its invalidity when it is set up against him although he has not taken steps to set aside. See (Abdullamiyan v. Government of Bombay : (1942)44BOMLR557 . This legal position is not disputed by Mr. Paranjape.

10. Under Order 21, Rule 94 Executing Court derives jurisdiction to issue sale certificate to the purchaser or in a given case to the assignee of purchaser. The Court has no jurisdiction to issue certificate in the name of a stranger. Unless the conditions referred to in Rule 94 are satisfied , the Court has no jurisdiction to issue sale certificate. Existence of assignment deed is a condition precedent for issuing certificate in the name of assignee. It is a jurisdictional fact. Obviously such an assignment will have to be in accordance with law. So far as an immovable property which is valued at more than hundred rupees is concerned a transfer can take place only by a registered instrument. If in law there is no assignment, then obviously the Court has no jurisdiction to issue a certificate in the name of such a person. The jurisdiction of the Court is circumscribed by the very wording of Rule 94 itself. If a certificate is issued in favour of a person who was not an assignee in law, or in fact, then it cannot be termed to be a mere irregularity, but obviously it is an order without jurisdiction because it goes to the very root of the matter. In this behalf a reference could usefully be made to a decision of the Supreme Court in Takkseela Padda Subba Reddi v. Pujari Padmavathama and others : [1977]3SCR692 . In that case the provisions of Order 21, Rule 64 of the Code of Civil Procedure fell for consideration of the Supreme Court. A contention was also raised therein that no objection was raised by the judgment-debtor before the Executing Court or invalidating the auction sale, which was contrary to the provisions of Order 21, Rule 64. After making a reference to the provisions of Order 21, Rule 64 and the fact of the case, the Supreme Court in the said case observed as under :---

''In these circumstances, therefore, we are clearly of the opinion that the Executing Court was not justified in the facts and circumstances of the present case, in selling the properties situated in village Gudipadu. The fact that the judgment-debtor did not raise an objection on this ground before the Executing Court is not sufficient to put him out of Court because this was a matter which went to the very root of the jurisdiction of the Executing Court to sell the properties and the non-compliance with the provisions of 0rder 21, Rule 64 of the Code was sufficient to vitiate the same so far as the properties situated in village Gudipadu were concerned.''

These observations aptly apply to the present case also. In the case before us also it seems to be an admitted position that there is no assignment in favour of the present plaintiffs. In the earlier suits filed by the plaintiffs themselves against Maniklal Narayandas viz. Civil Suit Nos. 1 of 1964 and 15 of 1966 the plaintiffs have claimed a declaration on the basis of a mere agreement of sale between the parties. Neither before the Executing Court or even in the present suit the plaintiffs have not produced any document of assignment. It is also an admitted position that the property was purchased by Maniklal Narayandas at the auction sale and in that capacity he became purchaser of the property. Therefore, in the absence of any valid transfer of the suit property by the method recognised by law a sale certificate could not have been issued in favour of the present plaintiffs by the Court under Order 21, Rule 94. Plaintiffs are not the purchasers of the property. Thus, the sale certificate issued in favour of the present plaintiffs was obviously without jurisdiction.

11. It is not possible for us to accept the contention of Mr. Paranjape that even without any valid transfer by mere admission of the party viz. Maniklal Narayandas a certificate could have been issued in the name of the plaintiffs. In our opinion, assignment contemplated by Rule 94 should be an assignment, which is recognised by law. It cannot be disputed that by a mere admission or oral consent of a party, in the absence of a written or registered document a transfer cannot take place qua immovable property in view of the provisions of the Transfer of Property Act and Registration Act. As it is an admitted position that such a document is not in existence, which confer any right or title upon the present plaintiffs, the Executing Court had no jurisdiction to issue such a sale certificate in the name of the plaintiff. An oral statement or oral consent is not an evidence of transfer of immovable property, more so in view of the admitted position that no registered assignment deed was ever executed by the purchaser in the name of plaintiff. The consent or oral representation made by Maniklal was of no consequence or value. In law it amounted to a misrepresentation. Further it also appears to be an admitted position that no notice was issued to the defendants before issuing the sale certificate. The plaintiffs themselves had chosen to file two earlier suits against Maniklal Narayandas claiming declaration in this behalf. In those suits plaintiffs were relying upon an agreement of sale only. Therefore, in this case it will have to be held that the certificate issued in the name of plaintiffs was without jurisdiction and therefore a nullity. Once it is held that the sale certificate issued in the name of the plaintiffs was without jurisdiction, then in our opinion , as a necessary consequence, it must follow that the plaintiffs had no title to the suit property and, therefore the suit which was solely based on such a sale certificate, which was a nullity, was not maintainable.

12. In the result, therefore, the appeal is allowed. The judgment and decree passed by the trial Court are set aside and it is directed that the suit filed by the plaintiffs shall stand dismissed. However, in the circumstances of the case there will be no order as to costs in this appeal, as well as in the suit.

13. The plaintiffs also have filed a cross-objection asking for future mesne profits. However, at the time of argument, in view of the decision of the Supreme Court in Sidramappa v. Rajashetty & others, : [1970]3SCR319 , the plaintiffs sought permission to withdraw the said cross-objection. Even otherwise in the view which we have taken was no substance in the cross-objection. Hence the plaintiffs are granted permission to withdraw the said cross-objection. There will be order as to costs in the cross-objection also.


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