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Maliram Nemichand JaIn Vs. Rajasthan Financial Corporation and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtRajasthan High Court
Decided On
Case NumberCivil Misc. First Appeal No. 142 of 1972 and Civil Misc. (Ex.) First Appeal No. 1 of 1973
Judge
Reported inAIR1974Raj204; 1974(7)WLN104
ActsCode of Civil Procedure (CPC) , 1908 - Sections 24 - Order 21, Rules 65, 69 and 90
AppellantMaliram Nemichand Jain
RespondentRajasthan Financial Corporation and anr.
Appellant Advocate M.B.L. Bhargava,; S.N. Bhargava and; A.K. Bhandari,
Respondent Advocate H.P. Gupta, Adv. (for No. 1) and; R.K. Rastogi and; H.C.
DispositionAppeal dismissed
Cases ReferredVenkataramana Aiyer v. Natesa Pillai
Excerpt:
.....we are, therefore, of opinion that the district judge presiding over the district court of jaipur district was competent to deal with the execution proceedings in this case when they were duly transferred under the orders of the high court.;(b) civil procedure code - section 24 and order 21 rule 90--warrant issued by d j (district) to a sale amin under d.j. (city)--held, sale amin competent to sell property--no prejudice caused.; since the warrant issued by the district court on 20th of july, 1971 was addressed to the nazir of the district court, jaipur city, which position was occupied by bhanwarlal, it shall be deemed that bhanwarlal was appointed by the district judge for conducting the sale in the matter and as such bhanwarlal was a competent person to carry out the mandate..........the court of district judge, jaipur city as sales amin was not a competent person to conduct the sale proceedings of the property which was auctioned in pursuance of the order issued by the district judge of the jaipur district. the warrant of sale was issued by the learned judge presiding over the principal court of jaipur district, jaipur and it was addressed to the nazir of the court of district judge, jaipur city. it is not disputed that bhanwarlal jain was the person who was functioning as nazir in the court of district judge, jaipur city. contention of mr. bhargava is that the district judge of jaipur district, jaipur forwarded the warrant to the district judge, jaipur city for service and not to bhanwarlal jain. according to the learned counsel addressing the warrant issued.....
Judgment:

Tyagi, J.

1. These two appeals are filed separately by the two partners of the judgment-debtor firm Messrs. Maliram Nemichand Jain, against the order of the learned District Judge, Jaipur 'District, Jaipur dated 5th of September, 1972, dismissing the objection petition filed by the judgment-debtor and passing the order of the confirmation of sale of the property belonging to the judgment-debtor.

2. Rajasthan Financial Corporation, Jaipur had obtained a decree against Messrs. Maliram Nemichand Jain and its partners Damodarlal and Gappulal and in the execution of that decree the building known as Hind Hotel situate in the centre of Jaipur City was sold. In the beginning, the execution proceedings were initiated in the court of the District Judge, Jaipur City, Jaipur, but later on the execution case was transferred by the High Court to the court of the District Judge, Jaipur District, Jaipur, as the Presiding Officer of the court of District Judge, Jaipur City, Jaipur felt that on account of his relationship with the judgment-debtors he will not be able to take any proceedings in the matter.

3. The property of the judgment-debtor was first of all auctioned on 5-3-1970 for Rs. 16 lacs, but this sale was set aside and the District Judge, Jaipur District ordered the property to be sold in two lots as requested by the judgment-debtors. In pursuance of the order of the District Judge dated 6th of June, 1970, the property was sold in two lots, one lot constituted of six show rooms and one shop whereas in the other lot the hotel portion of the building and one show room were sold. These two lots were put to sale. The first lot constituting of show rooms and one shop fetched the highest bid of Rs. 5,21,151 whereas the highest bidder for the hotel and one show room was for Rs. 7 lacs. A compromise between the parties thereafter was effected on 10th of April, 1971, wherein the sale of the first lot consisting of the show rooms and one shop was confirmed and the hotel portion of the building with one show room was again to be sold. In pursuance of this compromise, a fresh proclamation was issued for the auction of the hotel and it was mentioned therein that the sale shall take place from 22nd of July, 1971. The sale was accordingly conducted by Bhanwarlal, Nazir attached to the court of District Judge, Jaipur City. The sale continued at the site from 22nd of July, 1971 to 1st of August, 1971. From 2nd of August the venue of sale was changed from the site to the court premises. On 3rd of August, 1971 the sale was adjourned to 9th of August when the auction proceedings again started, but it was again postponed to 12th of August when the highest bid was of Rs. 8,22,000. Throughout the auction proceedings there were only two bidders, namely, Gopikishan and Vijay Kumar Patni. On 13th of August, 1971 the hammer fell and the highest bid of the auction-purchaser was accepted by the court.

4. Objections were filed by Gappulal and Daniodarlal separately on 10th of September, 1971 and 11th of September, 1971 which were dismissed by the learned District Judge without affording an opportunity to the judgment-debtors to adduce evidence in support of their objections. An appeal was filed against the order of the District Judge, Jaipur District, Jaipur dated 23rd of November, 1971 and this Court vide its judgment dated 31st of March, 1972 remanded the case to the file of the District Judge with a direction that the application under Order 21, Rule 90, Code of Civil Procedure filed by the partners of the judgment-debtor firm may be decided after giving the parties an opportunity to adduce their evidence on the points raised by them.

5. The judgment-debtors examined as many as 8 witnesses to support their objections. The auction-purchaser also examined Gopikishan as A. P. .W. 1 and the decree-holder brought two witnesses in the witness-box Vijaichand Jain (D. H. P. W. 1) and Om Prakash Bhargava (D. H. P. W. 2). The learned District Judge, after hearing the arguments of the parties at length, passed the impugned order which has been challenged before this Court, inter alia, on the grounds (1) that the District Judge, Jaipur District, Jaipur had no jurisdiction to entertain and dispose of the objection petitions filed by the appellants under Order 22, Rule 90. Code of Civil Procedure as this Court was not a competent court because the property was not situated within the jurisdiction of that court; (2) that Bhanwarlal Jain, Sales Amin who conducted the auction proceedings, was not competent to do so and therefore the proceedings taken by him are vitiated as having been conducted by an incompetent person; that the proclamation did not mention the valuation of the property which defect goes to the root of the matter and vitiates the sale; and (3) that the auction continued for more than seven days without issuing a fresh proclamation which contravenes the mandatory provisions of Order 21, Rule 69, Code of Civil Procedure and makes the sale illegal. Apart from these objections, learned counsel appearing on behalf of the appellants also drew the attention of this Court to various other irregularities, but we need not mention them here as the appellants did not' challenge the finding of the court below about discarding the evidence of the appellants on the ground that the auction could not fetch adequate price for the building as the prospective bidders were not permitted to have a look to the building and furniture which were the subject-matter of sale.

6. The first objection relates to the jurisdiction of the court of the District Judge, Jaipur District that conducted the sale of the disputed property in pursuance of the order issued by the High Court transferring the execution case from the court of the District Judge, Jaipur City to the present court. Shri D.D. Gupta, Presiding Officer of the District Court, Jaipur City, Jaipur referred the matter to the High Court expressing his inability to proceed with the execution case as he had some interest in the judgment-debtors. On that reference, the case was transferred by the High Court vide the order of the High Court dated 20th of April, 1970. The contention of learned counsel for the appellants is that the High Court could transfer the case only to such subordinate court which was competent to try or dispose of the matter. According to Mr. Bhargava, the property sold in the execution proceedings was situated in the city of Jaipur which falls within the jurisdiction of the court of the District Judge, Jaipur City and, therefore, District Judge of Jaipur District had no territorial jurisdiction to sell the property in auction as the expression 'competent' used in Clause (a) of Sub-section (1) of Section 24 of the Code of Civil Procedure covers within its ambit both the jurisdictions of the court i.e. pecuniary jurisdiction as well as territorial jurisdiction. The contention is that no territorial jurisdiction could be conferred on the District Judge of Jaipur District by transferring the case to that court as the property auctioned in the execution proceedings did not lie within the territorial jurisdiction of that Court and, therefore, District Judge of Jaipur District was not competent to take any proceedings in this matter. In support of this proposition, reliance has been placed by learned counsel for the appellants on Ram Das v. Habib Ullah, AIR 1933 All 178 (1) and Jannat Husain v. Gulam Kutubuddin Ahmed, AIR 1920 Pat 29. In our opinion, these authorities are of little help to the appellants as the question raised by the appellants stands decided by our own High Court in Chouth Mal v. Bhonrilal, AIR 1956 Raj 192. Bapna, J. while deciding that case expressed his inability to concur in the view expressed by the Allahabad and the Patna High Courts and observed that in most of the cases occasion may arise when there is no other competent court which may exercise the territorial jurisdiction over the subject-matter of the suit or proceeding within the jurisdiction of the district In that event, learned Judge expressed his opinion that if the case is to be transferred from the principal District Court, then it would become impossible to transfer that case to any other court if a narrow meaning is given to the word 'competent' used in Section 24 of the Civil Procedure Code. The learned Judge in that connection observed as follows:

'The competency referred to in Section 24 must be taken to be only with respect to the pecuniary jurisdiction, and I find support for this view in Kishore Lal v. Balkishan, AIR 1932 All 660 and Parshottamdas v. Bhagubhai, AIR 1932 Bom 486. The same view has been taken in F.E. Geyer v. M.M. Geyer, AIR 1'949 Lah 34 (FB). The contention raised above has no force.'

7. We respectfully agree with the expression given by Bapna, J. while interpreting the word 'competent' in Section 24 of the Code of Civil Procedure. While interpreting the provisions of law, the Court has to take into consideration all the circumstances and if by giving a narrow meaning to the word 'competent' in Section 24 an impossible situation is created, then we shall have to interpret the word in such a way that it may not create bottlenecks for the court to function under certain circumstances. We are, therefore, of opinion that the District Judge presiding over the District Court of Jaipur District was competent to deal with the execution proceedings in this case when they were duly transferred under the orders of the High Court.

8. It is vehemently contended that Bhanwarlal Jain who was attached to the court of District Judge, Jaipur City as Sales Amin was not a competent person to conduct the sale proceedings of the property which was auctioned in pursuance of the order issued by the District Judge of the Jaipur District. The warrant of sale was issued by the learned Judge presiding over the principal court of Jaipur District, Jaipur and it was addressed to the Nazir of the court of District Judge, Jaipur City. It is not disputed that Bhanwarlal Jain was the person who was functioning as Nazir in the court of District Judge, Jaipur City. Contention of Mr. Bhargava is that the District Judge of Jaipur District, Jaipur forwarded the warrant to the District Judge, Jaipur City for service and not to Bhanwarlal Jain. According to the learned counsel addressing the warrant issued under Order 21, Rule 66, Civil Procedure Code on 20th of July, 1971 to the Nazir of the court of District Judge, Jaipur City would not empower Bhanwarlal to conduct the auction proceedings. Since, according to Mr. Bhargava, the auction proceedings were taken by an incompetent man, the entire sale stands vitiated.

9. Order 21, Rule 65, Civil Procedure Code lays down that 'Save as otherwise prescribed, every sale in execution of a decree shall be conducted by an officer of the Court or by such other person as the Court may appoint in this behalf............'

10. According to this provision of the law, only two types of persons are entitled to conduct the auction in an execution proceeding: (1) an officer attached to the court for that purpose, and (2) any such other person as the court may appoint in this behalf. Since the warrant issued by the District Court on 20th of July, 1971 was addressed to the Nazir of the District Court, Jaipur City, which position was occupied by Bhanwarlal, it shall be deemed that Bhanwarlal was appointed by the District Judge for conducting the sale in this matter and as such Bhanwarlal was a competent person to carry out the mandate issued by the District Judge, Jaipur District to sell the property belonging to the judgment-debtors.

11. It may also be mentioned here that the judgment-debtors have not come out with any case that the conduct of sale proceedings by Bhanwarlal Jain has in any manner affected the sale' proceedings or the bidders could not come because the sale was being conducted by a particular man. No substantial injury has occasioned on this account to the judgment-debtors and, therefore, if for the sake of arguments it may be taken that an irregularity on this account has been committed in the conduct of auction proceedings, it cannot vitiate the sale.

12. As regards the third objection that the proclamation of sale did not mention the valuation of the property and that it lacked in details about the property to be auctioned, the sale cannot be said to have been legally effected, suffice it to say that if we look at the warrant issued by the court then the warrant contains 13 enclosures including the map and the details of other movable properties which were to be auctioned along with the building of the hotel. These enclosures are on the file of the lower court at pages A-71/11 to A-71/23. A cursory perusal of these documents gives an idea that the court has tried to give every detail of the movable properties which were to be sold along with the building, the map whereof was also attached to the warrant of sale.

13. The oral evidence adduced by, the judgment-debtors to substantiate this allegation has been disbelieved by the learned District Judge and the learned counsel for the appellants has not challenged that finding of the court below. We, therefore, cannot hold that the sale was in any manner affected even if any intending purchaser did not find the details in the warrant which he could have otherwise got if enquiry was made by him by looking at the enclosures annexed to the warrant of sale. It is true that the proclamation issued by the court which was undoubtedly settled by the court by taking both the parties into confidence did not contain the valuation of the property as claimed by the judgment-debtors at this stage, but, in our opinion, this defect in the proclamation cannot be pressed into service to get the entire sale of the property declared as illegal. In a recent case in Radhy Shyam v. Shyam Behari Singh, AIR 1971 SC 2337 the learned Judges who considered Rule 90 of Order 21, Civil Procedure Code, as amended by the Allahabad High Court, held :

'Rule 90 of Order XXI of the Code, ,as amended by the Allahabad High Court, inter alia, provides that no sale shall be set aside on the ground of irregularity or even fraud unless upon the facts proved the Court is satisfied that the applicant has sustained injury by reason of such irregularity or fraud. Mere proof of a material irregularity such as the one under Rule 69 and inadequacy of price realised in such a sale, in other words, injury, is, therefore, not sufficient. What has to be established is that there was not only inadequacy of the price but that that inadequacy was caused by reason of the material irregularity or fraud. A connection has thus to be established between the inadequacy of the price and the material irregularity.'

14. The proviso to Rule 90 of Order 21 also lays down a similar provision as was introduced by the Allahabad High Court and it provides that no sale shall be set aside on the ground of irregularity or fraud unless upon the facts proved the Court is satisfied that the applicant has sustained substantial injury by reason of such irregularity or fraud.

15. The learned Judges of the Supreme Court while considering the question of inadequacy of the price got at the auction clearly laid down that what has to be established is that there was not only inadequacy of price but that that inadequacy was caused by reason of the material irregularity or fraud. There is nothing on the record in the instant case to show that the price received at the auction sale of the property belonging to the judgment-debtor was due to the reason of the non-mentioning of the valuation of the property in the proclamation of sale. Even if it is accepted that the ultimate price of Rs. 8,22,000/- which was offered by the highest bidder at the auction sale was inadequate price even then we cannot set aside the sale unless the judgment-debtors by positive evidence have established that this inadequate price was received because of the reason of the non-mentioning of the valuation of the building and other articles in the proclamation of sale. In view of the law laid down by the Supreme Court, we find it difficult to accept the contention of Mr. Bhargava.

16. The sale has also been challenged on the ground that the sale continued for more than seven days without issuing a fresh proclamation and this procedure adopted by the executing court has rendered the sale a nullity. In support of this contention, reliance has been placed on a Bench decision of this Court in Mst. Sohan Devi v. Sona Ram, Civil Misc. Appeal No. 21 of 1957, D/- 30-1-1961 (Raj.).

17. In order to decide this objection, it will be relevant to mention certain dates on which the auction proceedings continued. The auction started on 22nd of July, 1971 and without interruption it continued upto 3rd of August, 1971. Realising that the bid was not adequate, the auction proceedings were adjourned on the 3rd August to 9th of August. On 9th of August the property was put to auction again, but it was again postponed for the 12th. On the 12th when the property was put to auction, it got the last bid and the hammer fell and ultimately the highest bid was accepted by the court. Mr. Rastogi appearing on behalf of the respondents urged that in the present case the auction was not postponed for more than seven days throughout this period when the proceedings to sell the property continued and, therefore, it cannot he said that the sale took place in violation of the provisions of Sub-rule (2) of Rule 69 of Order 21 of the Code of Civil Procedure. This Sub-rule provides that where a sale is adjourned under Sub-rule (1) for a longer period than seven days, a fresh proclamation under Rule 66 shall be made unless the judgment-debtor consents to waive it.

18. Let us now examine whether the sale was in any manner postponed for more than seven days during the period when the auction had taken place. The first adjournment came on the 3rd of August, 1971 and the next date fixed for the auction was 9th of August. Since the auction had taken place on the 3rd and again it continued on the 9th, therefore, the intervening period between these two days was only five days. On the 9th the sale was postponed to 12th; therefore, the sale could not take place on 10th and 11th, that is, for two days and thus the total number of days on which the sale could not take place since it commenced on 22nd of July, 1971, came to seven days only. This period of adjournment does not, therefore, exceed the period prescribed by Sub-rule (2) of Rule 69 of Order 21, Civil Procedure Code, and, therefore, it cannot be said with any justification that the adjournment given has in any manner violated the provisions of the said provision of Order 21, Rule 69. Civil Procedure Code.

19. In Sohan Devi's case Civil Misc. Appeal No. 21 of 1957, D/- 30-1-1961 (Raj.) this Court has held that the sale is vitiated if the proceedings of sale were adjourned for more than seven days. We feel that in the circumstances of the present case the ratio of Sohan Devi's case cannot help the appellants as we find that in this case the sale was not adjourned for more than seven days and, therefore, the mandate contained in Rule 69 is not in any manner violated. In Sohan Devi's case three adjournments were allowed and the total number of days for which the sale could not take place was 9 and, therefore, the learned Judges rightly found the violation of the provisions of Rule 69 of Order 21 of the Code of Civil Procedure.

20. It is contended by Mr. Bhargava that Rule 69 of Order 21 envisages that the sale should not in any manner be prolonged to a period which exceeds 7 days. We regret, we cannot accept this contention because Rule 69 deals only with adjournments and not with the continuity of the sale. If the sale takes place every day, it cannot be said that it has been adjourned from one day to another day The interpretation, which is sought to be put on Sub-rule (2) of Rule 69 of Order 21, Civil Procedure Code by learned counsel for the appellants, appears to us to be absurd. In Kalyani Achi v. Ramanatham Chettiar, AIR 1953 Mad 860, the auction continued every day except on holidays. For 5 days when the auction started there were no fresh bidders but the auction proceedings were conducted by the Sales Amin. On the last day, that is, on 25th of June, 1952 there were only two bidders. A question was raised that since the auction proceedings continued for more than 7 days, they were vitiated on account of the violation of the mandate contained in Order 21, Rule 69, Sub-rule (2), Code of Civil Procedure. The learned Judges while considering that objection observed as follows :

'Mr. A. Sundaram Aiyer for the respondents invited our attention to a number of cases to the effect that the practice of continuing the sale is not prohibited if the continuation is 'de die in diem'. The sale conducted 'de die in diem' for a period longer than seven days is neither illegal nor irregular; and to keep open the sale for a longer time is a very common practice and having regard to the local conditions, it cannot be said to be not a beneficial one.........'

21. In support of these observations, the learned Judges placed reliance on a Madras judgment in Subbanna v. Satyanarayanamurti, AIR 1943 Mad 739 and a Privy Council judgment in Venkataramana Aiyer v. Natesa Pillai, (1944) 2 Mad LJ 352 (PC). In the former case, the learned Judges observed that if a sale continued from day to day, it is not a case of adjourned sale at all and in such ,a case the sale might be continued for any length of time if the circumstances of the case warranted. Their Lordships of the Judicial Committee were also of the same view as was laid down in AIR 1943 Mad 739. In this view of the matter, we are of opinion that no irregularity or illegality has been committed in the conduct of sale by adjourning the auction proceedings for 7 days, as referred to above.

22. We may also refer to the argument of Mr. Bhargava that in the present case the venue of the sale was shifted from the site to the court premises and this change of venue has affected the sale, It may be mentioned here that the court itself directed on 31st of July, 1971, that the Sales Amin Bhanwarlal Jain should continue the same on 1st of August, 1971 at the site and it must be announced at the close of that day that the proceedings of auction shall take place on 2nd of August, 1971 at the court precincts. From this it is clear that the venue was not changed at the instance of the Sales Amin but it was done under the orders of the court itself. It is not denied that the Sales Amin had announced openly on 1st of August, 1971 that from the next day, that is, from 2nd of August, 1971 the sale shall take place in the court precincts. Throughout the auction proceedings, we find that there were only two bidders and these two bidders were present when the proceedings of sale took place at the court precincts on 2nd of August, 1971. The highest bid of Rs. 8,22,000/- was of the auction-purchaser. It is not the case of the appellants that due to the change of venue of the sale, the presence of the bidders was in any manner affected, In this view of the matter, we do not find any life in this objection and it is, therefore repelled.

23. For the reasons mentioned above, we do not find any force in these appeals. They are, therefore, dismissed with costs.


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