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Kalu Ram Vs. Shambhoo Singh and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtRajasthan High Court
Decided On
Case NumberCivil Revn. No. 35 of 1962
Judge
Reported inAIR1964Raj84
ActsCode of Civil Procedure (CPC) , 1908 - Sections 115 - Order 21, Rules 64, 66, 69(2), 83 and 90
AppellantKalu Ram
RespondentShambhoo Singh and anr.
Appellant Advocate A.L. Mehta, Adv.
Respondent Advocate B.B. Desai and; R.C. Maheshwari, Advs.
DispositionRevision dismissed
Cases ReferredMarudanayagam v. Manickavasakam
Excerpt:
.....service on 12-8-60. on 13-8-60 the judgment-debtor did not appear before the executing court. the sale proclamation was signed by the executing court on 24-8-60. 4. one objection taken on behalf of the judgment-debtor before me is that the sale is vitiated as the executing court failed to apply its mind to the terms of the sale proclamation. this application was very badly drafted. he is now estopped from urging that the failure to issue a fresh proclamation for the sale held on 17th november, 1960, and subsequent dates was a material irregularity in conducting the sale. there is thus no reliable evidence of the market value of the house on record. it is well known that the property does not fetch as much at an auction-sale held in execution proceedings ay it can at a private sale where..........order 21 rule 66 civil procedure code was issued to the judgment-debtor intimating to him that the sale proclamation shall be drawn up in court on 13-8-60. this notice was served personally on the judgment-debtor. he appended the date 13-8-60 against his signatures. that was probably done to acknowledge the fact that he had received intimation about some proceeding which was to be conducted on 13-8-60. the report of the process-server as well as the affidavit of service which was sworn before the nazir go to show that the process was returned after service on 12-8-60. on 13-8-60 the judgment-debtor did not appear before the executing court. it was ordered that a sale proclamation be issued as soon as process-fee etc., was filed. the sale proclamation was signed by the executing court on.....
Judgment:
ORDER

Jagat Narain, J.

1. This is a revision application by the judgment-debtor against an order of the executing Court refusing to set aside an auction sale on his application under Order 21 Rule 90 Civil Procedure Code. The order was confirmed on appeal by the District Judge. The revision application has been contested on behalf of the decree-holder as well as the auction-purchaser.

2. A decree for Rs. 2,142.87 plus Rs. 299.50 by way of costs was passed in favour of the decree-holder on 8-2-60. The decree directed that the mortgaged ornaments would first be sold and appropriated towards the decretal amount and the decree shall thereafter be executed against the defendant for recovering the balance remaining due. The executing Court proceeded to execute the decree both by the sale of the mortgaged ornaments and by the attachment and sale of a house belonging to the judgment-debtor. So far as the ornaments are concerned, it was found that they were of spurious metal and were not worth more than Rs. 150/-. The proceedings for the sale of the ornaments were thus given up and the Court proceeded to sell the house of the judgment-debtor.

The first objection taken before me is that the Court had no jurisdiction to proceed with the sale of the house before selling the ornaments as directed under the decree, I am unable to accept this contention. The judgment-debtor did not challenge either before the executing Court or the appellate Court that the mortgaged ornaments were not worth more than Rs. 150/-. An appreciable part of the decretal amount could not be realised by the sale of the ornaments. As such the executing Court had jurisdiction to execute the decree by the sale of the house of the judgment-debtor without selling the spurious ornaments.

3. In order to understand the other objections of the judgment-debtor it is necessary to state some more facts. After the house of the judgment-debtor had been attached in execution of the decree, the decree-holder filed an application on 16-5-60 as contemplated by Rule 66(3) of Order 21 for an order for sale. In this application it was mentioned that the house was subject to a usufructuary mortgage for Rs. 2,499/-and the equity of redemption was worth about Rs. 200/-. Notice under Order 21 Rule 66 Civil Procedure Code was issued to the judgment-debtor intimating to him that the sale proclamation shall be drawn up in Court on 13-8-60. This notice was served personally on the judgment-debtor. He appended the date 13-8-60 against his signatures. That was probably done to acknowledge the fact that he had received intimation about some proceeding which was to be conducted on 13-8-60. The report of the process-server as well as the affidavit of service which was sworn before the Nazir go to show that the process was returned after service on 12-8-60. On 13-8-60 the judgment-debtor did not appear before the executing Court. It was ordered that a sale proclamation be issued as soon as process-fee etc., was filed. The sale proclamation was signed by the executing Court on 24-8-60.

4. One objection taken on behalf of the judgment-debtor before me is that the sale is vitiated as the executing Court failed to apply its mind to the terms of the sale proclamation. Whether or not the Court applied its mind is a question of fact and cannot be raised for the first time before this Court. No such objection was taken before the executing Court. I may however observe that) as the judgment-debtor had not appeared to raise any objection against the particulars given by the decree-holder in his application dated 16-5-60 the Court had no reason to doubt that they were correct. It was the duty of the executing Court to apply its mind to the terms and I see no reason to accept the suggestion that it did not do so on 13-8-60 before ordering that a sale proclamation will be issued on the decree-holder depositing process fee etc. It is implicit in the order of the Court that the particulars given by the decree-holder will be incorporated in the sale proclamation. By a clerical error the value of the equity of redumption was shown as Rs. 300/- in the sale proclamation instead of Ks. 200/-

5. 7th and 8th October, 1960 were fixed for the sale of the house. The highest bid offered on 7th October, 1960, was Rs. 400/-. On 8th October 1960 a bid of Rs. 700/- was offered when the judgment-debtor filed an application in the executing Court under Order 21 Rule 83 praying for a postponement of the sale to enable him to raise the amount of the decree by transferring the property privately. In this application it was asserted that the house was worth Rs. 20,000/-. He prayed for two months time. The Court however granted him three weeks and permitted him to raise money by transferring the attached property privately on condition that if he did not succeed in doing so the sale will be continued on the same sale proclamation.

6. The judgment-debtor was unable to raise the amount of the decree by a private transfer, of the property within the time allowed. The Court thereupon ordered on 5-11-60 that the attached property will be sold on 17th, 18th and 19th November, 1960. Sale was held on these three dates and was continued till 21-11-60 under the orders of the Sale Amin. The highest bid which was offered on that date was Rs. 6,225/. The judgment-debtor filed an application in the executing Court in which he alleged that his house was worth Rs. 20,000/-. He prayed that the sale of his house should not be continued as the highest bid offered was only Rs. 6,225/-. This prayer could not obviously be granted by the executing Court and was rejected. He then made an oral prayer to the Court that the bids may be continued next day. This prayer was accepted by the Court. Later on the judgment-debtor withdrew this prayer and wanted the sale to be concluded on that very day. The highest bid on that day was Rs. 6,305/-. The property was sold for this amount subject to a usufructuary mortgage of Rs. 2,499/-.

7. The judgment-debtor then filed an application for setting aside the sale. This application was very badly drafted. The two material irregularities alleged in this application were that a fresh proclamation for the sale held on 17th November, 1960, and subsequent dates was not issued and that the property was grossly undervalued in the sale proclamation. It was asserted that the house was worth Rs. 20,000/- and was sold for such a low price on account of these irregularities,

8. Both these objections were rejected by the Courts below. It was contended on behalf of the judgment-debtor that the decision of the Courts below on both the points is erroneous. I am unable to accept this contention.

9. Order 21 Rule 83 provides that the Court may postpone the sale of the property on such terms as it thinks proper. The terms upon which the sale was adjourned was that no fresh proclamation will be issued. It was open to the judgment-debtor to accept the postponement on the terms imposed by the Court or to decline it. He elected to accept the postponement on the terms imposed by the Court.

10. Order 21 Rule 69 (2) provides that a sale may be adjourned for a longer period than 7 days without issuing a fresh proclamation if the judgment-debtor consents to waive it. As the judgment-debtor accepted the postponement of the sale on the terms imposed by the Court that fresh proclamation will not be issued, he will be deemed to have consented to waive the fresh proclamation. He is now estopped from urging that the failure to issue a fresh proclamation for the sale held on 17th November, 1960, and subsequent dates was a material irregularity in conducting the sale.

11. Coming now to the other objection that the price of the property shown in the sale proclamation was grossly low and that the house was sold for inadequate consideration the Courts below took the view that the judgment-debtor was estopped from taking this objection as he neglected to take such an objection at the time of the drawing up of the sale proclamation in spite of the fact that notice under Order 21 Rule 66 was served on him personally.

12. As has already been stated above the house was mortgaged with possession for a sum of Rs 2,499/-. The value of the equity of redemption was shown as Rs. 200/- by the decree-holder in his application for an order for sale. This equity of redemption was actually sold for Rs. 6,305/-. There is thus no doubt that it was grossly undervalued.

12a. As for the market value of the house Kalu Ram stated that his house was worth at least Rs. 18,000/-. His witness Bal Kishan stated that it was worth Rs. 15,000/- or 16,00/-. Two other witnesses Daulat Ram and Manna Lal stated that it was worth Rs. 14,000/- to 15,000/-. Another witness Chhagan Lal stated that it was worth Rs. 16,000/- or 17,000/-. Two witnesses were examined on behalf of the decree-holder and the auction-purchaser. One of them Ghan Shyam Dass was a clerk of the lawyer of the decree-holder. He stated that it was worth Rs. 7,000/- or 8,000/-. In cross-examination he admitted that be never purchased or sold any house. No value can be attached to his evidence. The other witness Shri Behron Lal, who was the counsel for the judgment-debtor in the case and who was examined on behalf of the decree-holder and the auction-purchaser to prove that the Court passed the conditional order under Order 21 Rule 83 in his presence and in the presence of Kalu Ram stated in cross-examination that the house of the judgment-debtor was worth Rs. 15,000/-. Much evidentiary value cannot be attached to this statement. The witnesses examined on behalf of the judgment-debtor were all laymen. There is thus no reliable evidence of the market value of the house on record.

It is however significant that the judgment-debtor could not find any person who might be willing to advance even a sum of Rs. 2,500/- by taking a mortgage of the house. The judgment-debtor was all along in know of the bids which were being offered for his house. On 8-10-60 the highest bid offered was only Rs. 700/-. The sale was adjourned to 17-11-60 and subsequent dates. Oil 21-11-60 the bid of Rs. 6225/- had been received when he filed an application before the executing Court. The Court offered to continue the sale for another day. But after sometime he declined the offer and asked the Court to conclude the sale. The sale was concluded at Rs. 6305/- The judgment-debtor must have made serious efforts to induce persons to offer higher bids for his house but evidently no one was willing to offer more than Rs. 6305/- for the equity of redemption. In these circumstances I am unable to infer that inadequacy in price if any, was due to the fact that the equity of redemption had been valued at Rs. 200/- by the decree-holder (shown as Rs. 300/- in the sale proclamation).

It seems to mo that as the house was already mortgaged with possession, bidders were apprehensive that they may have to go to the Court to obtain possession over it from the mortgagee and consequently they were reluctant to offer higher bids, even if it is assumed that the house was worth Rs. 14,000/- as alleged by Daulat Ram and Manna Lal who were examined on behalf of the judgment-debtor to prove its market value. The house was sold subject to the mortgage for Rs. 6305. The purchaser had to add the amount of the mortgage money to the price paid by him to arrive at the true price which he was paying for the house and had also to make some allowance far the expenses which he may have to incur on future litigation. It is well known that the property does not fetch as much at an auction-sale held in execution proceedings ay it can at a private sale where the seller is in possession of the property and is able to put the buyer in possession of it immediately. In case of an execution sale the auction purchaser has frequently to go to Court to resist the attempts of the judgment-debtor to have the sale set aside and apart from spending money over the litigation he has often to wait for years till the matter is finally decided by the highest Court.

13. On behalf of the judgment-debtor the decision in Saadatmand Khan v. Phul Kuar, 25 Ind App 146 : ILR 20 All 412 (PC) was referred to in which the Court came to a finding that the bids offered were low on account of the fact that the property was grossly undervalued in the sale proclamation. It is no doubt open to the Court to infer in an appropriate case, where the facts and circumstances so warrant that inadequate price is due to the under-valuation in the sale proclamation. But no hard and fast rule can be laid down that where there is under-valuation in the sale proclamation the Court must hold that the sale at an inadequate price is due to it. The proviso to Order 21 Rule go lays down that a sale cannot be set aside unless upon the facts proved the Court is satisfied that the applicant has sustained substantial injury by reason of the irregularity.

14. In view of what has been said above I am not satisfied that the inadequate price was due to under-valuation in the sale proclamation.

15. The view taken by the Courts below that, the judgment-debtor was estopped from raising an objection that the inadequate price wag due to under-valuation in the sale proclamation on account of the fact that he did not take any objection to the sale proclamation even though notice under Order 21, Rule 66, Civil Procedural Code was served personally upon him, is also correct and is supported by a series of decisions.

16. In Girdhari Singh v. Hurdeo Narain Singh, 3 Ind App 230 (PC) the sale was postponed without the issue of a fresh proclamation on the application of the judgment-debtor praying for such postponement (the attachment and the notification of sale being, maintained). Their Lordships of the Privy Council held-

'......although the alleged inadequacy of price was an ground for refusing to confirm the sale, yet that the above error in specifying the amount of Government revenue was an irregularity...... for which on proof of substantial injury to the judgment-debtor therefrom the sale might have been set aside but that the above petition for postponement amounted to an admission by the judgment-debtor that the notification was correct, or that there was no such irregularity as would be likely to mislead.'

At page 240 their Lordships observed -

'Now the notification must have been stuck up at the Court House, and he (judgment-debtor) must have had an opportunity of seeing what the real notification was; ...... he ought at that time to have made objection to the notification, and not to have consented to allow the notification to remain and be maintained as the notification under which the sale was to take place. .........

Their Lordships think that the judgment-debtor could not properly take objection to that notification by stating that there was an error in it. The petition amounted to an admission on his part that the notification was correct, or that at any rate there was no such mistake or irregularity as would be likely to mislead.'

17. In T.R. Arunachalam Chetti v. V.K.R.M.A.R. Arunachalam Chetti, 15 Ind App 171 (PC) where the judgment-debtors allowed the execution sale of the whole of their property to proceed without raising any objection of insufficient description, or to the effect that part ought to have been sold instead of the whole their Lordships of the Privy Council held that the sale could suit afterwards be set aside at their instance on these grounds. They observed at page 174 :-

'Therefore, as far as regards the objection that the description was insufficient, which is re-lied upon, as their Lordships understand, as vitiating the sale -- for that appeared to be the contention of the counsel for the Respondents --the objection was not taken until the sale had been completed. The judgment-debtors knowing, as they must have known, what the description was in the proclamation, allow the whole matter to proceed until the sale is completed, and then ask to have it set aside on account of this, as they say, misdescription. It appears to come within what was laid down by this Board in Olpherts v. Mahabir Pershad Singh, 10 Ind App 25 (PC), that if there was really a ground of complaint, and if the judgment-debtors would have been injured by these proceedings in attaching and selling the whole of the property whilst the interest was such as it was, they ought to have come and complained. It would be very difficult indeed to conduct proceedings in execution of decrees by attachment and sale of property if the judgment-debtor could lie by and afterwards take advantage of any misdescription of the property attached, and about to be sold, which he knew well, but of which the execution creditor or decree-holder might be perfectly ignorant -- that they should take no notice of that, allow the sale to proceed, and then come forward and say the whole proceedings were vitiated. That, in their Lordships' opinion, cannot be allowed, and on that ground the High Court ought not to have given effect to this objection,'

18. The above observations were held applicable to an objection on the ground that the property had been under-valued in the sale proclamation and purchased at an under-value in a series of decisions of Calcutta High Court. I may refer here to a decision of the Division Bench of that Court in Piramal v. Basanti Das, AIR 1935 Cal 614.

19. In Mst. Mehtab Bai v. Mst. Motan Bai, ILR (1960) 10 Raj 1088 a Division Bench, of this Court observed -

'We have already held above that Mst. Mehtab Bai was duly served with the notice under Order XXI, Rule 66 on the 15th June, 1955. The terms of sale in response to the Court's order, dated the 12th April, 1955, had been submitted by the decree-holder on the 29th April, 1955, and the sale-proclamation had actually been ordered to issue on the 2nd July, 1955. In these circumstances, there was ample opportunity for Mst. Mehtab Bai to arrange appearance on her behalf in Court by a duly constituted power of attorney if she so chose. It may also be mentioned in this connection that the sale which was ordered to take place in the first instance on the 5th to 7th September, 1955, actually came to be stayed in connection with the suit filed by one of the sons of Mst. Mehtab Bai in relation to this very property and to which she herself was a party and a fresh proclamation was then issued on the 20th November, 1957. There is material on the record to show that this was pasted on Mst. Mehtab Bai's house on the 7th December, 1957, and the property was on sale for a period of over a month until it was knocked down in favour of the respondent decree-holder on the 13th February, 1958.'

20. From the above facts their Lordships concluded that there was ample opportunity for Mst. Mehtab Bai to object to the estimated value of the property under sale if she chose to do so, or if she had any cogent reasons therefor and she, having not done so, cannot be heard to complain that the value of the property was far removed from the actual market value of the property.

21. On behalf of the judgment-debtor it was contended that he was ignorant of the fact what value of the property had been shown in the sale proclamation. Reliance was placed on his applications dated 8-10-60 and 21-11-60 in both of which he stated that his house was worth Rs. 20,000/-.

Relying on the decision of their Lordships of the Privy Council in Marudanayagam v. Manickavasakam, AIR 1945 PC 67 it was argued that it cannot be inferred in the present case that the judgment-debtor knew the true facts from which an intention on his part to waive his right to object to a misstatement in the proclamation could be interred. In that case there was a gross mis-statement of the encumbrance in the sale proclamation. The trial Court held that the judgment-debtor did not know what the encumbrance on his property was. The High Court did not record any finding on this point and their Lordship? of the Privy Council saw no reason to disturb the finding of fact arrived at by the trial Court. It will thus be seen that there was a finding in that case that the judgment-debtor did not know what the true encumbrance on his property was. In the present case notice under Order 21 Rule 66 was served on the judgment-debtor. He was a party to the execution proceedings which were taking place. He did say in the above two applications that his house was worth Rs. 20,000/-. From this it cannot be inferred that he did not know that the value of the equity shown in the sale proclamation was only Rs. 200/-.

As was observed in 3 Ind App 230 (PC) a copy of the sale proclamation must have been pasted on the notice board of the Court and he must have had an opportunity of seeing what the real notification was. He did not complain about the under-valuation of the equity of redemption. This amounted to an admission on his part that there was no such mistake in the sale proclamation as would be likely to mislead intending purchasers. The facts of the present case are thus distinguishable from the facts of the case in AIR 1945 PC 67.

22. I accordingly confirm the order of the Courts below and dismiss the revision application.

23. In the circumstances of the case, I direct that parties shall bear their own costs of this revision application.


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