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Prag Das Vs. Beni Prasad Jaggu Lal - Court Judgment

LegalCrystal Citation
Subject Civil
CourtAllahabad
Decided On
Reported inAIR1937All556
AppellantPrag Das
RespondentBeni Prasad Jaggu Lal
Excerpt:
.....to the corresponding provisions contained in the civil procedure code of 1882 that, if the auction-purchaser fails to make the initial deposit of 25 per cent, no bargain of sale could be considered to have been completed and that the subsequent sale cannot be considered to be a 're-sale'.this case has been declared to be no longer good law by a subsequent full bench ruling of this court :sita ram v. 200. the altered phraseology of rule 84 in one respect was held to indicate almost conclusively that a second sale on the failure of the auction-purchaser to pay 25 per cent, is 're-sale,'a term which has been used in rule 85; whereas the second sale under the corresponding provision of the code of 1882 was termed as a 'sale'.i hold, in view of sita ram v. it seems to me that rule 71,..........to be sold forthwith. it does not lay down the consequences of default in paying that part of the price. rule 87 lays down the consequences of non-payment of the remaining three-fourths of he purchase, money within 15 days. the language of this rule is such as to make it applicable only to cases in which default has been made in payment of three-fourths of, the purchase money, and cannot be construed as providing also for non-payment of 25 per cent, of the price. this analysis clearly shows to my mind that order 21, rule 71, applies to cases in which the auction, purchaser makes default in paying the whole of the price offered in the sale of moveable property, and 25 per cent, of the price in case of sale of the immoveable property. there is no justification for importing, into it the.....
Judgment:

Niamatullah, J.

1. This is an appeal from an order passed by the learned Additional Subordinate Judge of Allahabad ordering the appellant to pay the difference between the prices fetched by certain property sold in execution of decree and purchased by the appellant on two occasions. The appellant had obtained a decree against the respondent Beni Prasad for a certain sum of money, and in execution thereof had the latter's house put to sale on 21st February 1934. His own bid of Rs. 1,450 was the highest. The auction-purchaser (decree-holder) was not, however, able to deposit the one-fourth of the purchase money there and then but requested the sale officer to allow him half an hour for the deposit of that sum. The sale officer acceded to this request, but the appellant did not return. The sale officer, who was the Court amin, proceeded to the appellant's house and demanded one-fourth of the price. The appellant failed to deposit it and the matter was reported to the Court, before whom the case was laid for orders, on 24th February 1934, when it directed a re-sale of the house after a fresh proclamation. The house was eventually resold on 22nd August 1934 after a fresh proclamation was duly issued. The appellant again was the highest bidder, but on this occasion his bid was only Rs. 20, which was accepted. Subsequently the judgment-debtor made an application under Order 21, Rule 71, Civil P.C., for recovery from the appellant of the difference between Rs. 1,450, for which he had purchased the house on 21st February 1934, and Rs. 20, the price fetched by the property on re-sale. The appellant contested his liability to make good the loss on the ground that the re-sale did not take place 'forthwith', as required by Order 21, Rule 84, Civil P.C., and that consequently Rule 71 did not apply. The lower Court overruled the appellant's objection and ordered him to pay the difference between the two sums already referred to. The learned Judge pointed out that the delay which occurred in the re-sale of the property was due entirely to the appellant's own default, as he failed to deposit the necessary process fee.

2. It is contended in this Court that Order 21, Rule 71, Civil P.C., does not apply, unless on default of the purchaser the property was re-sold forthwith, as required by Rule 84. It is also contended that in the circumstances of this case it must be held that the re-sale did not take place forthwith. Reliance was placed on Amir Began v. The Bank of Upper India Ltd. (1908) 30 All. 273, in which it was held with reference to the corresponding provisions contained in the Civil Procedure Code of 1882 that, if the auction-purchaser fails to make the initial deposit of 25 per cent, no bargain of sale could be considered to have been completed and that the subsequent sale cannot be considered to be a 're-sale'. This case has been declared to be no longer good law by a subsequent Full Bench ruling of this Court : Sita Ram v. Janki Ram A.I.R. 1922 All. 200. The altered phraseology of Rule 84 in one respect was held to indicate almost conclusively that a second sale on the failure of the auction-purchaser to pay 25 per cent, is 're-sale,' a term which has been used in Rule 85; whereas the second sale under the corresponding provision of the Code of 1882 was termed as a 'sale'. I hold, in view of Sita Ram v. Janki Ram A.I.R. 1922 All. 200, that the sale which took place on 2nd August 1934 was a 're-sale' within I the meaning of Rule 84, Order 21, Civil P.C.

3. The more important question is whether Rule 71 is subject to the condition that the re-sale should have taken place 'forthwith' as directed by Rule 84. There is some authority in support of this view. A learned Single Judge of the Lahore High Court held in Hari Singh v. Sanwan Mal-Gopi Chand A.I.R. 1929 Lah. 744 that, if a re-sale does not take place forthwith, the defaulting auction-purchaser is not liable for the deficiency in the price fetched on re-sale of the property. Similarly, a Single Judge of the late Court of the Oudh Judicial Commissioner held in Angnu v. Mohammand Sajjad Ali Khan , that the result contemplated by Rule 71 is a sale according to law, and that if the property was not sold forthwith, the sale cannot be considered to be such as will attract the application of Rule 71. With great respect I am unable to accept the view which has been taken in these cases. It seems to me that Rule 71, which occurs under a different heading, is not dependent upon re-sale of the property strictly according to Rule 84. Rule 71 clearly I provides that:

Any deficiency of price which may happen on a re-sale by reason of the purchaser's default and all expenses attending such re-sale, shall...at the instance of either the decree-holder or the judgment-debtor, be recoverable from the defaulting purchaser....

4. All that that rule requires is that a re-sale should have taken place in consequence of default on the part of the auction-purchaser and should have fetched a price less than that offered on the first auction. There is nothing in Rule 71 itself which makes it a condition precedent that the re-sale should have taken place forthwith. It is true Rule 84 makes it incumbent on the Court that, if the person declared to be the auction-purchaser of a property fails to deposit 25 per cent, of the amount of the purchase money offered by him, the property shall be forthwith re-sold. There is however nothing in either Rule 84 or Rule 71 to justify the view that, in case the Court fails to sell the property forthwith, the auction-purchaser is not liable for the deficiency of the price offered by him. Rule 71 occurs under the heading 'Sale generally', so that it applies to sales of both moveable and immoveable properties. In cases of sales of moveable property, the whole of the price offered for each lot is to be paid immediately, and in case of default the lot is to be sold forthwith (Rule 77). In the case of immoveable property the rule is less stringent, and the auction-purchaser is required to pay immediately only 25 per cent, of the price, the balance being payable within 15 days. Rule 84 provides that, in case of nonpayment of 25 per cent, the property is to be sold forthwith. It does not lay down the consequences of default in paying that part of the price. Rule 87 lays down the consequences of non-payment of the remaining three-fourths of he purchase, money within 15 days. The language of this rule is such as to make it applicable only to cases in which default has been made in payment of three-fourths of, the purchase money, and cannot be construed as providing also for non-payment of 25 per cent, of the price. This analysis clearly shows to my mind that Order 21, Rule 71, applies to cases in which the auction, purchaser makes default in paying the whole of the price offered in the sale of moveable property, and 25 per cent, of the price in case of sale of the immoveable property. There is no justification for importing, into it the condition that the property should have been re-sold forthwith, and not after some delay which is not fatal to the sale.

5. In Hanumayamm v. Ankamma A.I.R. 1930 Mad. 761 it seems to have been, assumed, by implication, but not decided, that Rule 71 is subject to Rule 84, and that in making the defaulting auction-purchaser liable for the deficiency, the Court should hold that the re-sale took place 'forthwith'. The Full Bench held that the expression 'forthwith' merely means 'as expeditiously as the circumstances of the case permit'. In that case the sale had taken place next day, and the learned Judges had no difficulty in holding that the re-sale took place forthwith within the meaning of Rule 84. There is nothing in that case to justify the view that, if there-sale takes place after a fresh proclamation the defaulting auction-purchaser is relieved of the obligation imposed by Rule 71. In the case before me, the appellant himself was responsible for the delay which occurred in the re-sale of the property. The Court was not bound to order the issue of a fresh proclamation. Strictly speaking, the procedure in that respect was irregular. The Court was probably misled by Rule 87, which directs that:

Every re-sale of immoveable property in default of the payment of the purchase-money within the period allowed for such payment shall be made after the issue of a fresh proclamation....

6. As already remarked, this rule applies to cases in which default is made in payment of the remaining 75 per cent, of the price. This is indicated by the words 'within the period allowed for such payment', which is hardly consistent with the view that the rule applies also to cases in which the initial payment of 25 per cent, is not made for which no period is provided and which is to be paid immediately. Be that as it may, the essential question is whether the irregularity implied in the order of the Court directing the issue of a fresh proclamation relieved the defaulting auction-purchaser of the liability which he undoubtedly incurred by not paying the 25 per cent, of the price immediately. It may be said that, if the property had been sold forthwith, a higher bid would have been offered than Rs. 20, fetched a few months afterwards. If this was the case, the appellant was to blame. Instead of paying the 25 per cent, immediately, he obtained time from the sale officer and made himself scarce. As soon as he found that he could not arrange for the money, it was his duty to ask the sale officer to re-sell the property on that day or next day, without a fresh proclamation being issued. He was the decree-holder, besides being the auction-purchaser, and should have objected to the order directing the issue of a fresh proclamation. The lower Court has found, and nothing has been said to show, that its view is wrong, that the delay occurred in consequence of the decree-holder not paying the process fee and not taking steps to have the sale proclamation issued expeditiously. It does not lie in his mouth to complain of the delay which occurred in the re-sale of the property. The result is that the order appealed from is upheld and the appeal is dismissed with costs. Leave to appeal under the Letters Patent is granted.


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