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Mohideen Imbrahim Vs. Mahomed Mura Levai Through His Agent Mahomed Mira Sahib - Court Judgment

LegalCrystal Citation
SubjectCivil;Property
CourtChennai
Decided On
Reported in17Ind.Cas.437; (1912)23MLJ487
AppellantMohideen Imbrahim
RespondentMahomed Mura Levai Through His Agent Mahomed Mira Sahib
Cases ReferredNilakanta v. Imam Sahib I.L.R.
Excerpt:
.....also the language of act viii of 1859 the first civil procedure code. the court laid down that a purchaser at a sale in auction knows that no one guarantees him that the judgment-debtor had a good title, that he purchased the property with his eyes wide open and regulates the price which he bids with reference to the risk. order xxi rule 66 in like manner as section 287 of the code of 1882 does not contain the provision embodied in section 249 of the the code of 1859 that the proclamation should specifically state that only the right, title and interest of the judgment-debtor shall be sold and is practically in the same terms as section 287 of the code of 1882. order xxi, rule 90 embodies section 311 of the old code but gives the power to apply to the court to set aside the sale on the..........v. narayana i.l.r. (1887) m. 269 and nilakanta v. imam sahib i.l.r. (1892) m. 361 plaintiff's right of suit accrued on 21st january 1907, when the decree in o.s. no. 341 of 05 was confirmed on appeal it does not appear that he ever obtained possession of the property purchased. whether a similar right of suit exists under the present code is a point on which it is unnecessary to express an opinion, though i should be loth to hold that it did not. but i certainly do not find anything in the present code which would have the effect of taking away the right of suit which had accrued to the plaintiff before it came into force. i therefore hold the present suit to be maintainable.3. as regards the question of limitation nilakanta v. imam sahib i.l.r. (1892) m. 361 is authority for.....
Judgment:

Ayling J.

1. The facts of the case are sufficiently set forth in the judgment of the Subordinate Judge : and his decision appears to me to be correct. Two points are argued on behalf of the petitioner, (1) that the present suit is not maintainable and (2) that it is barred by Article 62 of Schedule I of the Limitation Act.

2. As regards the first point, the Court auction under which plaintiff (Respondent) purchased the property, the filing of O.S. No. 341 of 05 to declare the title of a third person other than the Judgment-debtor and the final decision of that suit, all took place, while thfe old Civil Procedure Code (Act XIV of 1882) was in force. It has been repaatedly held that under Section 315 of that Act a suit by a Court auction purchaser to recover the sale price from the decree-holder would lie where it was found on a suit brought by a third party that the judgment-debtor has no title whatever to the property sold in Court auction (vide Gurnshidawa v. Gangaya I.L.R. (1897) B. 783 following Munnah Singh v. Gajadhar Singh I.L.R. (1883) a. 577 Pachappan v. Narayana I.L.R. (1887) M. 269 and Nilakanta v. Imam Sahib I.L.R. (1892) M. 361 Plaintiff's right of suit accrued on 21st January 1907, when the decree in O.S. No. 341 of 05 was confirmed on appeal it does not appear that he ever obtained possession of the property purchased. Whether a similar right of suit exists under the present code is a point on which it is unnecessary to express an opinion, though I should be loth to hold that it did not. But I certainly do not find anything in the present code which would have the effect of taking away the right of suit which had accrued to the plaintiff before it came into force. I therefore hold the present suit to be maintainable.

3. As regards the question of limitation Nilakanta v. Imam Sahib I.L.R. (1892) M. 361 is authority for holding that Article 120 applies to suits brought under Section 315 of the old Code. The petitioner relies on the cases reported in Ram Kunwar Saha v. Ram Gour Saha I.L.R. (1909) C. 67, Kovvuri Hasana Reddi v. Tallapragad Nayanna I.L.R. (1911) M. 39. The latter of these was a case of private sale and though the Calcutta case was one of court sale the decision followed that in an earlier case of private sale, Hanuman Kamat v. Hanuman Mandur I.L.R. (1891) C. 123 and the question of whether a suit under Section 315 should be distinguished was not considered. I hold that the suit is not time barred.

4. The petition must therefore be dismissed with costs.

Napier J.

5. This is a suit to recover from the defendant money paid on the purchase at a court auction in execution proceedings of certain property. The defendant was the decree-holder in S.C. 219 of 1894. In execution of his decree he brought certain lands to sale as belonging to his judgment-debtor and the plaintiff purchased them. Subsequently a third party brought a suit to establish his title to the land making the plaintiff and the defendant in this suit parties and his title was upheld. The plaintiff then applied in execution proceedings for refund of his money, but the court held that his remedy was by a suit. He accordingly instituted S.C. 156 of 1910 against the judgment-creditor and the Subordinate Judge gave him a decree.

6. It is contended in this Court that no suit lies. It is admitted that under Section 315 of Civil Procedure Code of 1882 the purchaser would be entitled to receive back his purchase money; but it is argued that under the present Code no such right exists and his rights are governed by the Code.

7. It is necessary to examine the history of this claim. It has been laid down by the Privy Council in Dorat AH Khan v. The executors Khajhee Moheeooddeen I.L.R. (1878) C. 806 that as in India moveable and immoveable property are alike capable of being seized and sold under the writ of fieri facias the responsibility of the sheriff in respect of sales here is governed by the law relating to chattels rather than by that relating to the sale of real property, It is clear that where the property seized was personal estate and it was sold by the sheriff no suit lay either against the sheriff or the judgment-creditor who had received the purchase money to recover it when the property had been recovered from the purchaser by a person claiming title the principle being that a sale by the sheriff was not a sale in market overt the purchaser acquiring thereby only what the judgment-creditor had a right to sell, namely, the precise interest and no more which the judgment-debtor possessed in the goods and that there was no warranty of title implied in a sale by the Sheriff (vide Halsbury's Laws of England Vol. XIV, paragraph 113). This is on the authority of Chapman v. Speller (1850) 14 Q.B. 621 which was a claim for money had and received by the purchaser at a sheriff's sale against the vendor of the goods. The court held that the true consideration was not the property sold but the assignment of the right of the judgment-debtor whatever it was and that therefore there had not been a failure of consideration and accordingly the auction purchaser could not recover. It is clear from the decision of the Privy Council that that law applies in India apart from the statute. An attempt was made in Soudamani Chowdranee v. Kishen Kishore Peddar (1869) 12 W.R. 8 to recover money paid in the like circumstances under the provisions of Regulation VII of 1825 but the Court negatived the right and in so doing considered also the language of Act VIII of 1859 the first Civil Procedure Code. Section 249 of that Act provided that the proclamation should declare that the sale extended only to the right title and interest of the defendant in the property. Sections 256 and 257 provided for circumstances under which sales might be set aside on the ground of material irregularity in the conduct of the sale. Section 258 provided that where the sale of immoveale property was set aside the purchaser should be entitled to receive back his purchase money and it was argued that this section applied where the property was recovered by a third party. The Full Bench negatived this view and held that it only applied where the sale of the immoveable property was set aside for irregularity under the previous sections. The Court laid down that a purchaser at a sale in auction knows that no one guarantees him that the judgment-debtor had a good title, that he purchased the property with his eyes wide open and regulates the price which he bids with reference to the risk. The law was materially altered by Act X of 1877, the provisions of which are re-produced in this respect in Act XIV of 1882. The proclamation under Section 287 of that Act did not state that all that was sold was the right, title and interest of the judgment-debtor. Further it purports to give a great deal of information about the property and especially requires to be stated the incumbrances to which the property is liable and every other thing which the Court considers material for the purchaser to know in order to Judge of the nature and value of the property. Section 311 corresponds with Section 256 of the Code of 1859 in allowing an application to the Court to set aside the sale on the ground of material irregularity. Section 312 corresponds with Section 257 and is the procedure section with reference to the above. Then comes an entirely new Section 313 entitling the purchaser to apply to the Court to set aside the sale on the ground that the person whose property purported to be sold had no saleable interest therein under Section 315 which embodies Section 258 of the Code of 1859 includes among the circumstances under which the purchaser was entitled to receive back his purchase money this new circumstance 'when it is found that the judgment-debtor had no saleable interest in the property purported to be sold and the purchaser for that reason is deprived of it.' It is to be noted that the procedure by which the money is to be recovered is not stated in this section and it has accordingly been held that these sections give a substantial right to recover money paid to a judgment-creditor which may be exercised either by suit or by petition in execution proceedings. This was expressly decided in Pachayappan v. Narayanan I.L.R. (1887) M. 269 where a suit to recover the money was held to be a proper procedure following Nilakanta v. Imam Sahib I.L.R. (1882) m. 361 and has been lately re-affirmed in Bam Kumar Saha v. Ram Gour Shahad I.L.R. (1909) C. 67 where the procedure was likewise by a suit.

8. We now come to the new Civil Procudure Code. Execution is dealt with in Part II of the Code Sections 36 to 74 and in order XXI. The sections of the Code contain no provision dealing with this question. Order XXI Rule 66 in like manner as Section 287 of the Code of 1882 does not contain the provision embodied in Section 249 of the the Code of 1859 that the proclamation should specifically state that only the right, title and interest of the judgment-debtor shall be sold and is practically in the same terms as Section 287 of the Code of 1882. Order XXI, Rule 90 embodies Section 311 of the old Code but gives the power to apply to the Court to set aside the sale on the ground of fraud in publishing and conducting it as well as on the ground of material irregularity. Rule 91 corresponds with Section 313 and empowers the purchaser to apply to the Court to have the sale set aside on the ground that the judgment-debtor had no saleable interest in the property sold and Rule 92 provides that where an application is made under Rule 91 and is allowed, the Court shall make an order setting aside the sale and unless such an application is' made and allowed or an application to set aside on the ground of irregularity or fraud, the Court shall make an order confirming the sale and thereupon the sale shall become absolute. Then Rule 93 provides that where the sale is set aside for any of the above reasons the purchaser shall be entitled to an order for re-payment of his purchase money against any person to whom it has been paid. Now the language differs very considerably from Section 315 of the old Code. Section 315 provided that, where the sale was set aside under the corresponding sections, the purchaser should be 'entitled to receive hack 'his purchase money and also where it is found that the judgment-debtor had no saleable interest in the property.' This last provision is entirely omitted in Order XXI R 93 and the words 'the purchaser shall be entitled to receive back his purchase mone.3''' are altered into the words 'The purchaser shall be entitled to an order for repayment of his purchase money,' The omitted words in Section 315 were the basis of the decisions in the cases above referred to, that a substantive right to receive back the purchase money was conferred upon the purchaser. This second substituted and limited right must be exercised before the sale is confirmed and when no such application is made the sale becomes absolute on the order of confirmation. It cannot of course be contended that these words can pass to an auction-purchaser property to which judgment-debtor had no title. It necessarily follows therefore that what is confirmed on the sale becoming absolute is only the right, title and interest of the judgment-debtor even though the notice to that effect is not inserted in the proclamation as it was under the Code of 1859. It is contended that this procedure works great hardship on an auction purchaser; for he may have no knowledge of the want of title in the judgment-debtor and may, therefore, not apply under Order XXI, Rule 91 and that the real owner of the property may not bring his suit either for declaration or to recover possession until sometime after the confirmation of the sale in which circumstances the auction purchaser has no remedy. This is so; but the Legislature must be assumed to have had knowledge of the decisions that those words created a substantive right and of the results of the alteration made in the law. The right is no longer a substantive right entitling the auction purchaser to recover his money, but a right to get an order in execution proceedings for re-payment if he discovers the absence of interest before the confirmation of sale.

9. This being the law on the subject, it remains to ascertain the appellant's position. He purchased the property in August 1903; the suit by the stranger was brought in the same year,, decreed on 13--3--06 and confirmed on appeal on 21--1--07. The Code of 1882 was in force than and accordingly there then accrued to the auction purchaser a right to recover the money by suit. By virtue of Section 6 of the General Clauses Act X of 1897 the repeal of the Code of 1882 by the New Code, Act V of of 1908 which came into force on the 1st of January 09 did not affect the right acquired under that enactment and it continued in him though his right to exercise it would in time become barred by limitation. He brought his suit to enforce this right in January 1910 and it is next contended that this suit is one for money had and received by the defendant for plaintiff's use, in which case limitation begins to run from the date when the money is received, i.e., August 1905 under Article 62 of both the old nnd the New Limitation Acts and that therefore his suit is barred. Reliance is placed upon Kovvuri Basiva Beddi v. Tallapragada Nagamma I.L.R. (1911) M. 39 Ramlmmar Shaha v. Ram Gour Shaha I.L.R. (1909) C. 67. Apart from the cases there is one answer which must on principle be fatal to this contention which is this : that no article can apply which would make the right to sue liable to be barred before it has come into existence; and if this contention were correct, that could easily occur in a suit of this nature. The substantive right comes into existence under Section 315 when it is found that the judgment-debtor has no saleable interest. The true owner of the land might conceivably not bring his suit for ten years after the auction purchase and the cause of action would not arise till then. How could the suit on this cause of action have been barred seven years before it came into existence? A further answer is that this is not a suit at Common Law for money had and received to the plaintiff's use but a suit on a statutory right. In the case of a suit to recover purchase money paid for property bought at a private sale the case of Haniunan Kamat v. Hamiman Man lur I.L.R. (1891) C. 123 decided by the Privy Council is an authority for the proposition that Article 62 or Article 97 would apply according as whether the consideration failed originally or subsequently, that is to say, the starting point is the time at which the cause of action occurred and this case has been followed in Kovvuri Basiva Beddi v. Tallapra ada Nagamma I.L.R. (1911) M. 39. As pointed out above, the cause of action in the present case did not arise when the money was actually paid as in the case of a sale by private contract when title is warranted, but on the date when it was found that the judgment-debtor had no saleable interest. This distinction has not been noted by the learned Judges who decided the case of Ram Kumar Shaha v. Ham Gour Shaha I.L.R. (1909) C. 67 and I am unable to agree, with the view they took. There is a clear authority for the view that Article 62 does not apply in Nilakanta v. Imam Sahib I.L.R. (1892) M. 301 a case on all fours with this. The court held that Article 120 was the appropriate article and undoubtedly the language is most apt with regard to the starting point 'when the right to sue accrues.' I agree with the view of the learned udges in that case and it follows that this suit is in time and therefore the petition must be dismissed with costs.


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