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Bhanwari Lal Vs. Shyamlal and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtRajasthan High Court
Decided On
Case NumberCivil Misc. Exe. First Appeal No. 114 of 1962
Judge
Reported inAIR1965Raj42
ActsCode of Civil Procedure (CPC) , 1908 - Sections 11 - Order 21, Rules 66 and 90
AppellantBhanwari Lal
RespondentShyamlal and ors.
Appellant Advocate Harak Lal Manihar, Adv.
Respondent Advocate Than Chand, Adv.
DispositionAppeal allowed
Cases Referred and Shankar Ramkrishna v. Daga Tanaji
Excerpt:
- - 3. it is urged on behalf of the appellant-judgment-debtor that the order of the executing court is erroneous in law because the principle of res judicata could not have been and cannot be rightly held to be applicable under order 21, rule 90, code of civil procedure in the circumstances of the case, while on the other hand it has been very strenuously contended by the learned counsel for the contesting respondents that the learned district judge was perfectly right in the view he took. the objections raised by the judgment-debtor in that application, it clearly appears, were more or less the objections which were sought to be raised by him in his application under order 21 rule 90 c. the question to decide is whether this contention is well founded. when the judgment-debtor,.....modi, j.1. this is an execution appeal by a judgment-debtor against an order of the district judge, jodhpur, dated the 3rd of august, 1962, dismissing an application under order xxi, rule 90, code of civil procedure in circumstances presently to be mentioned.2. respondents nos. 3 and 4 kanmal and chandmal had obtained a decree against the appellant bhanwarilal for enforcement of a mortgage. respondent no. 2 brij kishore is an assignee of that decree. the house under mortgage was put to auction in execution of the decree, and respondent no. 1 shyamlal goyal purchased it. the appellant moved an application under order 21, rule 90, code of civil procedure alleging that there were certain irregularities and illegalities in the publishing and the conducting of the sale and, therefore, the same.....
Judgment:

Modi, J.

1. This is an execution appeal by a judgment-debtor against an order of the District Judge, Jodhpur, dated the 3rd of August, 1962, dismissing an application under Order XXI, Rule 90, Code of Civil Procedure in circumstances presently to be mentioned.

2. Respondents Nos. 3 and 4 Kanmal and Chandmal had obtained a decree against the appellant Bhanwarilal for enforcement of a mortgage. Respondent No. 2 Brij Kishore is an assignee of that decree. The house under mortgage was put to auction in execution of the decree, and respondent No. 1 Shyamlal Goyal purchased it. The appellant moved an application under Order 21, Rule 90, Code of Civil Procedure alleging that there were certain irregularities and illegalities in the publishing and the conducting of the sale and, therefore, the same be set aside. Issues were framed by the executing Court on the 13th of July, 1962 and had presumably been set down for trial, when an objection was raised that the other issues need not be tried, and the issue relating to res judicata be taken up first as that would go to the root of the whole matter. The result was that the learned Judge heard arguments on that issue and came to the conclusion that the irregularties raised by the judgment-debtor had already been decided earlier by his order dated the 15th of November, 1961 and consequently the principle of res judicata was attracted, and the same issues could not be tried and decided over again. In this view of the matter, the judgment-debtor's objection was dismissed by an order dated the 3rd August, 1962 and it is against this order that the judgment debtors has come up in appeal.

3. It is urged on behalf of the appellant-judgment-debtor that the order of the executing Court is erroneous in law because the principle of res judicata could not have been and cannot be rightly held to be applicable under Order 21, Rule 90, Code of Civil Procedure in the circumstances of the case, while on the other hand it has been very strenuously contended by the learned counsel for the contesting respondents that the learned District Judge was perfectly right in the view he took. In order to substantiate the plea of res judicata, reliance is placed on behalf of the said respondents on the order of the learned District Judge dated the 15th November, 1961. This order came to be passed on an application of the judgment-debtor that he had made in the executing Court for postponing the sale which had already been ordered. The objections raised by the judgment-debtor in that application, it clearly appears, were more or less the objections which were sought to be raised by him in his application under Order 21 Rule 90 C. P. C. These objections, so far they are common to the two applications are :--

(1) that the property under sale should have, been divided into lots as it was of very high value and then ordered to be sold in parts instead of wholly;

(2) that the estimated price of the property under sale was mentioned at a substantially low figure of Rs. 28,000/-, where as according to the judgment-debtor, it was of, the value of about Rs. 60,000/-; and

(3) that no proper description and boundaries of the property under sale were given in the sale proclamation.

4. Now, so far as these objections go, it appears to have been held by the learned DistrictJudge in his order dated the 15th November, 1961that it was open to the judgment-debtor to haveraised his objections as regards the auctioning ofthe property wholly instead of by instalments ofas to the inadequacy of the estimated price of thatproperty mentioned in the sale proclamation, whenhe had been served with a notice under Order 21Rule 66 of the Code of Civil Procedure. Hefurther held, and this is important to note, that ifthe property be of a substantially higher value then,it is quite likely that it would fetch that price atthe time of auction, and therefore the learned Judgewas definitely of the view that that was no groundfor ordering postponement of the sale. As for theobjection that the description and the boundaries ofthe property to be auctioned were not properlymentioned in the sale proclamation, the learnedJudge entertained the view that although thejudgment-debtor had supported his allegation by anaffidavit, it was not quite clear where the errorprecisely lay, and, that, in any case, there was noproof in support of the allegation or allegationsmade in that behalf.

Mention might also be made of another objection which was raised at the time of the previous application for the postponement of the sale that the name of the place, where the auction will be held was not mentioned at all in the sale proclamation, and what was merely mentioned was that the sale will take place at Jodhpur; but, observed the learned Judge, that every prospective purchaser knows that the auction is held at the site wheres the property is situated and therefore, he was of the opinion that that was also no ground for postponing the sale. Having said all that, the learned Judge further went on to observe, though it is not quite clear whether he made this observation with respect to the last mentioned objection or to those mentioned earlier also, that if the judgment-debtor should suffer any loss on that account, then he has a right in law to make an application for setting aside the sale and take the necessary steps in that connection. This is how the earlier application was dismissed, and it is on the strength of the findings arrived at therein that the contention wag pressed on behalf of the contesting respondents in the Court below, and the same is pressed before us, that the judgment-debtor should be held to have been and be barred from raising these objections over again. The question to decide is whether this contention is well founded.

5. Having heard learned counsel for the respondents at considerable length, we regret to have to say that we see no force in his contention. Elaborating his arguments, learned counsel based his submission on two principal grounds.

The first was that any objection which the judgment-debtor could have raised at the time of the settlement of the sale-proclamation under Order 21 Rule 66, of Code of Civil Procedure could not be raised thereafter, and such an objection if raised in an application under Order 21 Rule 90 C. P. C, should be held to be barred by the principle of constructive res judicata. In the second place his submission was that so far as the auction-sale is concern-ed, it had been stated by the learned counsel for the appellant before the Court below that the objections raised thereto in the application under Order 21 Rule 90 C. P. C. had been decided by that Court by its order dated the 15th November, 1961, and, once that fact was admitted, it is not open to the judgment-debtor to raise these objections over again after that order had been passed rejecting those objections.

6. We shall now take up both these objections in the order in which we have set them out above.

7. As to the first objection, it seems to us that it is based ,on an erroneous approach to the precise question before us. Before an enquiry into a matter can be held to be precluded on the principle of res judicata, one of the basic conditions amongst others is that the same matter must have been substantially and directly in issue on the earlier occasion. Now the point that has to be remembered in this connection is that on the previous occasion the judgment-debtor wanted the sale to be postponed for certain reasons which we have already indicated. The question of setting aside the sale as such was not and could not be at issue at that time. When the judgment-debtor, however, came to make an application under Order 21 Rule 90 Code of Civil Procedure, it was precisely this question which was in issue, namely, whether the sale which had in the meantime taken place deserved to be set aside for the reasons mentioned in Order 21 Rule 90 C. P. C. Let it be remembered in this connection that before a sale can be set aside under the last mentioned provision, two conditions must be fulfilled-

(1) that there was a material irregularity or illegality or fraud in the conduct or publishing of the sale; and

(2) that such a defect must have caused prejudice or substantial injury to the judgment-debtor.

It clearly seems to us that before, the question of substantial injury having been caused to a judgment-debtor as a result of the sale, which has been impugned, could possibly arise, the matter must have proceeded further from the stage of mere proclamation for sale, and a sale must have actually taken place, and, assuming further that there might have been some fraud or material irregularity or illegality in the conduct of the sale, even that would be of no consequence within the meaning of Order 21 Rule 90, if all that has not resulted in substantial injury to the judgment-debtor. In this state of law, it seems to us that wet would be going too far if we accede to the submission of the learned counsel for the respondents that an objection which could have been raised by the judgment-debtor at the stage of proclamation of sale but had not been so raised by him should be incapable of being raised in a subsequent application under Order 21 Rule 90 even though I it might be productive of substantial injury to the judgment-debtor.

It is perfectly correct that when a notice is given to the judgment-debtor under Order 21 Rule 66 C. P. C. the object is to give him an opportunity to see that the various matters which are required to be mentioned in the sale proclamation are correctly mentioned. The judgment-debtor, therefore, takes a big risk when he chooses not to appear at that stage and fails to raise any objection which it is open to him to raise at that stage. To say that, however, is one thing. But it is quite another to go further and held that because he failed to raise an objection as respects some of the particulars which are required to be mentioned in the sale proclamation at the time when it was to be settled, he is thereby precluded from raising that objection by means of an application under Order 21 Rule 90 as respects a material irregularity or fraud in publishing or conducting it, even though such a defect related to some of the requirements of Order 21 Rule 66 C. P. C., and by reason of such irregularity or fraud, the applicant had sustained a substantial injury. The acceptance of the view contended for by the learned counsel for the respondents would, in our opinion, render Rule 90 almost wholly nugatory by overemphasising the ambit and effect of Order 21 Rule 66, and we are definitely of the opinion that we should not interpret the one rule at the cost of the other. Order 21 Rule 90 comes later than Order 21 Rule 66 in the scheme of that order; and sound canons of legal interpretation clearly require that one must interpret both these rules so as to read them harmoniously with each other rather than that they be read so that one destroys the other.

Bearing these considerations in mind, the correct approach to a question like the present, in out considered opinion, is and must be that where there has been a material irregularity or fraud in publishing and conducting an execution sale even though such material irregularity or fraud pertains to any of the requirements of sale proclamation under Order 21 Rule 66, then an application under Order 21 Rule 90 to set aside the sale can be made provided further that no sale shall be set aside on the ground of such irregularity or/and fraud unless the applicant further establishes that he has sustained substantial injury by reason of such irregularity or fraud, although in coming to this conclusion the circumstances that the judgment-debtor had an opportunity to raise the particular objection or objections under Order 21 Rule 66 would always be a factor and, if we may say so, an important factor, while considering the totality of circumstances to decide whether the sale should be set aside or not. This is the view, which appeals to us to be the correct view on first principles and we are of the opinion that the case law which has been cited before us by learned counsel for the respondents contains nothing which should dissuade us from following that course.

8. This brings us to a brief discussion of the case law to which our attention has been called by the learned counsel for the respondents.

9. The first case to which we shall refer is Mst. Mehtab Bai v. Mst. Motan Bai, ILR (1960) 10 Raj 1088 a Division Bench decision of our own High Court to which one of us was a party. In this case a sale proclamation was issued and duly served under Order 21 Rule 66 C. P. C. and the gale was fixed for certain dates in September, 1955, then the sale was stayed and a fresh proclamation was issued and served, and sale was fixed on certain dates in January, 1956, and the dates of the sale were subsequently extended, and the sale was eventually made in favour of the auction purchaser on the 13th February, 1958 and the same was confirmed on the 17th October, 1959. An application was then moved by the judgment-debtor for setting aside the sale, and the most important point that was raised was that no proper estimated value of the property under sale or the rental value thereof was mentioned in the sale proclamation, the contention being that the house in question which was really worth sixty to sixty-five thousand rupees had been sold only for Rs. 27,800/-and thereby a substantial injury had been caused to the judgment-debtor. It was, in these circumstances, held that (1) there was ample opportunity for the appellant to appear or arrange appearance on her behalf at the time the sale proclamation came to be settled and to object to the estimated value of the property under sale if he chose to do so, and he, having not done that, cannot be heard to complain that the value mentioned in the sale-proclamation was far removed from the actual market value of the property, and (2) that the estimated value which was in fact mentioned in the sale proclamation was a fair, approximate value of the property in question.

10. Learned counsel for the respondent strongly relies on this decision as a basis for his argument that the application under Order 21 Rule 90 C. P. C. in the present case was barred by res judicata, which according to him, is the meaning of the expression used therein namely that the judgment debtor 'cannot be heard to complain that the value mentioned was far removed from the actual market value of the property', and forcefully contends that this decision is binding on us. We have carefully considered this submission and see no substance in it. The expression in 'cannot be heard to complain', quoted above, was used to emphasise the conclusion to which the Bench was prepared to come in the circumstances of the case briefly set out above that it did not lie in the mouth of the appellant to raise that kind of complaint in the case, he having done nothing to have the estimated price corrected if he thought that it was grossly under-stated. The author of the present judgment is in a position to say that with confidence as he was the author of that judgment also. Let it be noted that if the view of the Bench was that such an objection could not be raised on the ground of res judicata, there was nothing to prevent it from saying so in plain words. It further deserves to be pointed out that the Bench did not rest content with making the observation on which reliance is placed by the learned counsel, but went further to hold that the estimated value which was in fact mentioned in the sale proclamation was a fair approximate value. It should have been entirely unnecessary to reach any finding on this aspect of the case if the matter could not be gone into on the merits. It further deserves to be noted that this was an appeal against an order passed under Order 21 Rule 90 on the merits of that application, and the appeal was dismissed in the view the Bench took thereof. Under the circumstances, we have no manner of hesitation in holding that this case does not help the contesting respondents in any way, and, if we may say so with all respect, tends to favour the opposite view.

The same principle in our opinion emerges from an earlier Bench decision of this Court--in Jaichand Lal v. Manakchand, ILR (1951) 1 Raj 199. In that case one of the contentions for setting aside the sale was that no estimated, price was mentioned in the sale proclamation, and, it was urged that it was the duty of the Court to mention every other thing which the court considers material for a purchaser to know in order to judge the nature and value of the property. The Bench observed that there was difference of opinion between the various High Courts on the question, whether the Court should mention the estimated value of the property in sale proclamation or not, and, referring to the decision of their Lordships in Saadatmand Khan v. Phul Kaur, 25 Ind App 146 (PC) on which reliance was placed on behalf of the appellant, observed that their Lordships did not lay down in that case in so many words that the estimated value of the property should always be mentioned in the sale proclamation, but at the same time held that there was no doubt that the Court should provide such particulars as may be material for a purchaser to know in order to judge of the value of the property, and laid down certain particulars which could be mentioned in that connection. The Court in that case did not give any particulars in this behalf and the learned Judges came to the conclusion that there was a material irregularity in publishing and conducting the sale. The point to be noted in connection with this case is that although notice of the sale proclamation under Order 21 Rule 66 C. P. C. had been served on the judgment-debtor and he had failed to appear in response thereto, still his application under Order 21 Rule 90 was entertained and was not thrown out on the ground that it was barred by the principle of res judicata.

11. The same conclusion, in our opinion, emerges, though again indirectly, from the decision of their Lordships in 25 Ind App 146 (PC). In this case there was a material misrepresentation as to the value of the property contained in a sale proclamation. The judgment-debtor amongst other things wanted the sale to be set aside on this ground. The executing Court held that the misrepresentation as to value was not a material irregularity on account of which the sale could be set aside. This view was repelled by their Lordships in the following words,--

'This is a very mistaken view. It is true . . .. .. .. that the mis-statement is something more grave than an ordinary irregularity of procedure, but the fact that it is so, and that it was made gratuitously by the decree-holder and the Court, does not prevent it from being 'a material irregularity in publishing or conducting' the sale, such as to bring the case within the special remedy provided by Section 311'

which was the corresponding provision of Order

21 Rule 90 in the Code of 1882. It is clear to our mind from this decision that a judgment-debtor or any other person whose interests are affected by the sale within the meaning of Order 21 Rule 90 can apply to the Court to set aside the sale on the ground of material irregularity or fraud in publishing or conducting it, notwithstanding the fact that he had an opportunity (which he had failed to avail himself of) to point out the irregularity or fraud at the stage of drawing of the sale proclamation, provided, however, that no such sale can be set aside on the aforesaid ground, unless the aggrieved person satisfies the Court that the applicant had sustained substantial injury by reason of such irregularity or fraud; and further that he cannot be prevented from doing so by the principle of res judicata.

12. Our attention was invited by learned counsel for the respondents to Gauri v. Ude, AIR 1942 Lah 153 (FB), Pirji Safdar Ali v. Ideal Bank Ltd. AIR 1949 E P 94 (FB), and Shankar Ramkrishna v. Daga Tanaji, AIR 1949 Bom 79.

13. The question in the first two cases was whether the property which was sought to be put up to sale was saleable in the sense that it was exempt from attachment or sale under Section 60, Civil Procedure Code, and the contention was raised that such an objection should be allowed to be raised at any time as there can be no estoppel against the statute. This objection was repelled on the ground that the judgment-debtor had an opportunity to raise it earlier but had failed to do so and therefore could not raise it later on the principle of constructive res judicata embodied in Section 11(4) of the Civil Procedure Code. The ratio of this decision seems to have been that Order 21 Rule 90 allows an application for setting aside the sale on limited grounds only namely on the ground of a material irregularity or fraud in publishing or conducting it, and that does not cover any objections to the sale on the ground that the property in question was not liable to be sold under Section 60. It was also laid down that the word 'conducting' of the sale had been used in the Code with reference to the proceedings of the officer conducting the sale, and cannot be construed so widely as to cover objections relating to saleability of property. In other words it was held that an objection like this did not fail within the meaning of Order 21 Rule 90 C. P. C.

This, in our opinion, becomes further clear by the observations made at page 160 in Gauri's case, AIR 1942 Lah 153 (FB), where it is observed that along with Rule 66 have to be read Rules 90 and 92 which leave little doubt that the Code does not contemplate any objections being raised after the auction except such as fall within the scope of Rule 90 i. e. objections relating to material irregularities and fraud in publishing and conducting the sale. The learned Judges further observed that this was presumably so because objections such as those relating to the liability of the property to be sold were intended to be disposed of before the sale. It may also be pointed out at this place that by a local amendment the Lahore High Court had added another proviso to Order 21 Rule 90, by which it was enacted that no auction sale be set aside on any ground which the objector could have put forward before the sale was conducted, although it was held by the learned Judges in this case that the proviso in question being an exception to the main rule could not so interpreted as to refer to objections falling outside the ambit of those mentioned in the body thereof and therefore, it could not be held to be a bar to the raising of objections relating to the saleability of the property. It was in these circumstances that the judgment-debtor in this case was held to be barred from raising the objection as to the saleability of the property in question on the principle of res judicata. As we read this judgment, there is nothing therein which really runs counter to the view which we have proposed above. The same observations, in our respectful opinion, more or less, apply to the decision in AIR 1949 EP 94 (FB) and AIR 1949 Bom 79 to which our attention was invited.

14. The conclusion, therefore, to which we come on this aspect of the case is that the dominating objects of Order 21, Rule 66 and of Order 21, Rule 90, C. P. C. are essentially different, that they are applicable to proceedings at different stages in the process of execution and that the failure on the part of the judgment-debtor to raise an objection with respect to any of the particulars required to be mentioned in the sale proclamation under Order 21, Rule 66 cannot be a sufficient ground in law to debar him from raising such objections after the sale is concluded, provided that these objections do fail within the four walls of Order 21, Rule 90, that is, are objections as respects the publishing or conducting of the execution sale, though we should like to add that the failure to raise an objection falling within Order 21, Rule 66 at the time of the drawing of the sale proclamation would usually be an important factor to consider in any decision as to the merits of any application to set aside the sale under Order 21, Rule 90. We hold accordingly.

15. Applying this principle to the facts and circumstances of this case, we are clearly of the opinion that the judgment-debtor before us was fully competent in law to raise the objections that he did in his application under Order 21, Rule 90 and that the Court below was wrong in throwing it out on the ground of res judicata. When we say this, we should not be understood to express any opinion on the merits of the objection for this is an entirely separate matter upon which the executing Court will have to give its verdict after both parties have had the opportunity to lead evidence relating thereto and the Court has applied its mind to the same. We hold accordingly.

16. The next submission of learned counsel for the contesting respondents was that the learned counsel for the judgment-debtor had admitted before the learned District Judge that the objections which he had raised in his application under Order 21, Rule 90 had been decided by the Court by its order dated the 15th of November, 1961 and consequently it was not open to him to agitate these matters over again, nor, it was necessary for the Court to give any fresh finding with regard to them. Adverting to this aspect of the case, we find that the learned counsel for the respondent-judgment, debtor has raised a specific ground in his memorandum of appeal filed in this Court that the learned Judge of the Court below has misunderstood the nature of the admission made by him and that what he had merely admitted during the course of arguments before that Court was that the objections had been raised which had been decided by the learned Judge by his order dated the 15th November, 1961 but he never admitted that the matter was res judicata or that he was thereby precluded in law from raising those objections by an application under Order 21, Rule 90, Learned counsel futher emphasised that he had strenuously contended before the Court below that the principle of res judicata did not apply in this case, and he further urges that in any case an admission on a point of law, even if it is accepted that he made it, would not be binding on his client and can be shown to be erroneous at any stage. We think that this submission has considerable force.

Fully granting that learned counsel had conceded before the Court below that the objections raised in his present petition had also been raised in the earlier application which had been disposed of by an order dated the 15th of November, 1961, we do not think that the learned Judge was right in inferring from this that it had been conceded before him that the raising of those objections was barred by the principle of res judicata and further that it was neither open to him nor to the Court to decide those objections as required by Order 21, Rule 90 of the Code of Civil Procedure. In fact if there was one contention which the learned counsel for the appellant seems to have pressed before the Court below was, and, which he still presses, is that, in the circumstances, his application under Order 21, Rule 90 is not barred by res judicata. We are not, therefore, prepared to accept that he could have conceded a point like this. It is also correct that any concession on such a point is clearly one on a point of law and it is settled law that a party is not bound by the admission made by his counsel on such a point.

Furthermore, we should like to point out in this connection that as we read the order of the learned Judge dated the 15th November, 1961, we do not think that he intended to finally dispose of those objections by that order. For, the learned Judge clearly stated with reference to one of the objections, namely as regards, the alleged understatement about the real value of the property sought to be sold that if the property was as a matter of fact of higher value, it might in all probability fetch a higher price than the estimate made of it in the sale proclamation. Later towards the end of his order, he further made it clear that if any substantial injury might be caused to the judgment-debtor by reason of one for more) of the irregularities alleged (for the order is not as clear in that behalf as we should have liked it to be) then it would be open to the judgment-debtor to have the sale set aside. The reference could not but be to Order 21, Rule 90, Code of Civil Procedure. In these circumstances, we are not prepared to accept that the learned Judge when he passed the order dated the 15th November, 1961 refusing to postpone the sale, had 'finally' decided the objections raised by the judgment-debtor. His attitude at that time judging from the language of the order as a whole clearly appears to us to be that he was not prepared to postpone the sale on account of the irregularities alleged but at the same time it was certainly not his intention that thereby the judgment-debtor should stand precluded from raising any of those objections, in so far as they fell under Order 21, Rule 90, by a proceeding under that provision. We find, therefore, not a little difficult to comprehend how the learned Judge when he came to pass the order under appeal put a different construction on his own order that he had passed on the 15th of November, 1961 suggesting thereby that that order was final on the points raised before him as to attract the principle of res judicata.

17. As we have analysed the order of the learned Judge in its true effect, it clearly seems to us that he had left those points open, to be decided for the purposes of application under Order 21, Rule 90, C. P. C. if and when necessary, and, that being so, it is futile, in our opinion, to contend on the part of the contesting respondents that the principle of res judicata would at all come into play in the circumstances of the case. Consequently we reject this submission also.

18. For the reasons mentioned above, we allow this appeal, set aside the order of the District-Judge dated the 3rd August, 1962 and remit the case back to him for an enquiry on the issues already framed by him and for a fresh decision on the merits according to law. The appellant will have his costs of this appeal. We further hereby direct that the learned counsel for both the parties will put in appearance in the executing Court on 25th September 1964 without fail.


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