1. This appeal is preferred against the judgement and decree in O. S. 114 of 1962 Sub-Court, Vijayawada by the plaintiffs in that suit which was dismissed with costs.
2. The appellants-plaintiffs are the great grant-son of Mutyaly. The third defendant is the son and the fourth defendant is the son of the third defendant , the plaintiffs being the sons of the fourth defendant. Mutyaly executed a mortgage in respect of a house of which the plaint schedule property forms part in favour of the first defendant for a sum of Rs. 3,500/-on 17-12-1940. Thereafter he also executed a sale in respect of the property in favour of the first defendant on 9-3-41. One of the terms of the sale was that n case Mutyalu paid the sale consideration of Rs. 7,500/- at any time between 9-3-47 and 8-3-1952 the first defendant should re-convey the property. Before the expiry of the time stipulated Mutyaly died. The son and grand-son, the third and fourth defendants filed a suit O. S. 74/52, Sub-Court, Vijayawada contending that the sale-deed was really a mortgage by conditional sale and they are entitled to redeem the same. The matter was compromised and the compromise decree was passed on 21-010-1952 where under the eastern part of the house marked 'A' in the Plan attached to the decree should be taken absolutely by defendants 3 and 4 and the western portion should be taken by the first defendant and defendants 3 and 4 should give up their right to redeem the same. The first defendant should further receive a sum of Rs. 4,000/- as consideration for giving up his right s in the 'A' marked portion. But as they did not have the requisite money, the eastern portion allotted to defendants 3 and 4 was against mortgaged in favour of the first defendant on 30-9-1952 for a sum of Rs. 10,000/-. The first defendant filed a suit on foot of the mortgage, O. S. 32/54 Sub-Court, Vijayawada and obtained a preliminary decree on 28-8-1954. Ultimately, a final decree also was passed. The mortgagee thereupon filed E. P. 389/56 to execute the mortgage decree and also successive E. Ps. In 1962 the plaintiffs filed the present suit for partition of the plaint schedule properties into four equal shares and for possession of one such share. They also filed a petition for an interim injunction restraining the first defendant herein from proceeding with the execution of the mortgage decree which he had obtained in O. S. 32/54 Sub-Court, Vijayawada. Interim injunction was ordered. The suit however was dismissed for default on 15-1-64 and on that day the petition for injunction also was dismissed for default on 15-1-64 and on that day the petition for injunction also was dismissed. On an application by the plaintiffs the suit was restored to file in March 1965. Thereafter, the first defendant filed E. P. 269/65 for executing the mortgage decree . It appears that the executing Court returned the E. Ps. asking the decree-holder therein to state whether the injunction granted was vacated. It was re-presented stating that though the suit was restored to file the injunction petition was not restored with the result that there was no injunction operating against the first defendant. Ultimately, the E. P. was rejected on the ground that the High court decree was not filed. The first defendant then filed E. P. 120/66 and in that E. P. she brought 68 and purchased the property herself for Rs. 28,000/-. The plaintiffs tried to avert the sale by filing e. As. 184, 185 and 186/68 praying for stay of the sale and for other reliefs but they were dismissed and the sale was held. As against the said order in one of the E. As. E. A. 184/68 the plaintiff preferred C. R. P. 368/69 to this Court which was also dismissed on 6-3-1968. Thereafter the sale was confirmed on 16-3-1968.
3. The plaintiffs thereupon had their plaint amended by including a prayer for declaration that the sale in O. S. 32/64 was illegal, void and not binding on the plaintiffs.
4. In the Court below several contentions were raised including the contention that the mortgage dated 7-3-41 was discharged, that the mortgage dated 30-9-52 was not supported by consideration and in any event the sale held in execution of the mortgage decree was illegal. The Court below found all the issues against the plaintiffs and dismissed the suit with costs.
5. In this appeal the only question that is raised by Sri Surya Rao, on behalf of the appellants is that the sale held in execution of the mortgage decree in O. S. 32/64 Sub-Court, Vijayawada is illegal petition was dismissed for default was restored to file it has the effect of restoring status quo in regard to all proceedings as on the date of dismissal for default. He therefore submitted that the position in law was that the interim injunction which was granted originally also revived along with the suit. In view of the injunction order restraining the first defendant from proceeding with the execution of the decree in O. S. 32/64 Sub-Court, Vijayawada, all further proceedings in execution including the sale deed were illegal and void. He further proceedings in execution including the sale deed were illegal and void. He further submitted that even assuming that the sale was not illegal the Court had inherent jurisdiction to set aside the sale which was held in execution proceedings which were taken by the first defendant in violation of the injunction order.
6. There can be no doubt that when a suit which was dismissed for default is restored to a file after setting aside the order of dismissal for default all interlocutory orders made are automatically restored. It is now clearly laid down in a recent decision of this Court in N. Rami Reddi v. N. Padmareddi : AIR1978AP30 that once an order of dismissal for default of the suit is set aside the plaintiff must be restored to the position in which he was situated when the court dismissed the suit for default. The court has no doubt, powers to limit the order of restoration in one way or the other but unless the court either expressly or by necessary implication excludes operation of interlocutory orders during the period between the dismissal and the restoration, it may be safely presumed that their endorsement during that period was also restored. The Division Bench followed the decision of a Full Bench of the Madras High Court in Veeraswamy v. Ramanna, AIR 1935 Mad 365 that where an order dismissing a suit for default was set aside the suit remains as it was on the day when it was dismissed and all proceedings taken up to that date must be deemed to be in force when the dismissal was set aside and all interlocutory orders will be revived on the setting aside of the dismissal. In view of the above decision it follows that the interim injunction granted in the suit before it was dismissed for default was revived and the legality of the sale held in execution of the decree has to be considered on the footing that the injunction order was in operation. Sir Suryanaryana learned Counsel for the respondent while admitting in view of the above decision, that the injunction was in operation, submitted that it does not follow that proceedings in execution of the decree in contravention of the order of injunction and the sale held in such proceedings are void. He submitted that it may be that for violation of the injunction order it is open to take proceedings for contempt or the proceedings referred in O. 39, CPC but there is nothing either in O. 39 CPC or any provision of the Civil Procedure Code which make the execution proceedings and the sale held illegal. In support of this contention he relied upon a decision in A. Vittal v. Ramakistiah AIR 1969 Andh Pra 167. After considering the relevant authorities it was held in that case that the sale in violation of injunction order did not vitiate the transaction. The decision in Subrahmanyam v. Narasimhiah (1963) 1 Andh WR 135 where it was held that the consequence of disobedience of an injunction is not to render the transaction entered into between the person against whom the injunction was issued and a third party altogether void is cited with approval, as also the decision in Taraporwala v. Kazim Ali : AIR1966AP361 where it was held that a sale in disobedience of an injunction would be an irregularity and would not be illegal. Though the above decisions relate to private sales, the Division Bench cited with approval the decision in Lal chand v. Sohanlal AIR 1938 Lah 220 where it was held that the sale in execution of the decree in spite of an injunction order was a nullity. Reference was made to S. 64 CPC which expressly provides that a transfer of property which is subject to attachment is nullity and it was pointed out that there is no similar provision invalidating a sale held in contravention of an injunction order. In view of the this decision it is clear that the sale held in execution of the decree though made contrary to the order of injunction which stood revived on the restoration of the suit cannot be attacked as a nullity.
7. Sri P. P. Surya Rao however contended that even though the sale may not be void or illegal the court has inherent powers to declare the sale illegal if it was the view that the first defendant had acted in violation of its injunction order. He submitted that the court had inherent powers to see that the injunction orders made by it are obeyed and if any advantage is gained by disobeying the orders of the court the erring party should not be allowed to retain that advantage. In support of this contention he drew my attention to Century Flour Mills v. S. Suppiah , : AIR1975Mad270 (FB). In that case convening of a general body meeting was stayed. Nevertheless the meeting was held and certain resolutions were passed. The question for consideration was whether the resolutions passed at the meeting can validly stand notwithstanding the fact the meeting was held in violation of the order of the court. It was argued that no wrong-does in respect thereof should be allowed to derive any benefit out of his own wrong. It was also submitted that under S. 151 CPC the court should put back the parties in the same position as they had been immediately before the order of stay was issued. After considering the various decisions it was held that the inherent powers of the court under S. 151 CPC was wide and where in violation of a stay order or injunction against the party something was done in disobedience, it was they duty of the court as a policy to set the wrong right and not allow the perpetuation of the wrong doing. The inherent power will not be available but it is bound to be exercised in the interests of justice. Even apart from S. 151 as a matter of judicial policy the court should guard against itself being stultified by holding that it is powerless to undo a wrong done in disobedience of the court's orders. Reliance was placed on Manoharlal v. Seth Harilal : AIR1962SC527 in which it was held that even apart from the Civil P. C., the court can pass orders in the interests of justice. Another decision that was relied on is Hari Nadhan v. S. N. Pandita : AIR1975All48 where the plaintiff was dispossessed by the defendants who wilfully disobeyed the interim injunction order restraining them from dispossessing the plaintiff. It was held that the court which issued the order of injunction can after considering the circumstances of each case and the conduct of the parties always pass such an order in the ends of justice as would undo the wrong done to the party in whose favour the order of injunction had been issued. The learned Judges followed the decisions in State of Bihar v. Usha Devi, : AIR1956Pat455 and Magna v. Rustam, . It is unnecessary to refer to the various other decisions to the same effect cited by the learned counsel for the appellant. To sum up, the legal position is that a sale held in execution of a decree even contrary to an order of injunction restraining the decree-holder from proceeding with the execution is not ipso facto void or illegal. The court however should not, in appropriate cases when it is of the view that is order has been transgressed and the sale had been held, allow the party who has violated the order of injunction to derive any advantage from such violation and should restore the parties to the same position as they were before the injunction order was made and in order to achieve this purpose it has power in appropriate cases to set aside the sale.
8. Sri Suryanarayan Rao submitted that this is not a case where such a power is required to be exercised. He submitted that it is not a case of flagrant or open violation of the injunction order. He submitted that the first defendant was under the belief that it was only the suit that was restored and no the order of interim injunction and that is why he re-presented the execution petition stating that the injunction order was not in operation, as the petition had been dismissed. He submitted that even the judgement-debtors in the case, defendants 3 and 4 and also the plaintiffs and even the court was under the impression that the execution proceedings should be continued and the sale was therefore held. As has already been noticed the plaintiffs filed in an application to stay the same on the ground that the present suit was pending. Even in that application it was not state that the execution petition could not be proceeded with in view of the order in the injunction petition which stood revived when the suit was restored. Even after the sale was held no petition was filed by defendants 3 and 4 or by the plaintiffs who according to them had an interest in the property sold for setting aside the sale on the ground of fraud in the conduct of the sale, namely, proceeding with the sale in spite of the injunction order. I am therefore of the view that even though the court has inherent power to set aside the sale which has been held in violation of the injunction order in appropriate cases, the appellants have not made out that circumstances exist in the case for exercising that power.
9. In the result the judgement of the lower court is confirmed and the appeal is dismissed.
10. No costs.
11. The appellant will pay the court fee.
12. Appeal dismissed.