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Unnamalai Ammal Vs. P.A.J. Seyyadu Mohideen and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtChennai High Court
Decided On
Case NumberCivil Revn. Petn. No. 1120 of 1962
Judge
Reported inAIR1967Mad231; (1965)2MLJ554
ActsCode of Civil Procedure (CPC), 1908 - Sections 47 and 151 - Order 21, Rules 89, 90, 91 and 93
AppellantUnnamalai Ammal
RespondentP.A.J. Seyyadu Mohideen and ors.
Cases ReferredVeeraraghavalu v. Chengalamma
Excerpt:
.....- revision against rejection of application made by third party-auction purchaser for refund of poundage paid by him on sale being set aside - there might be cases where sale was held but no valid final decree in existence - such was not due to fault of decreeholder or judgment debtor - in such cases it may be desirable in interests of justice to grant certificate so that revenue authorities may consider it - when sale in pursuance of valid decree which is only voidable and not void is set aside under order 21 rule 90 then there cannot be grant of certificate for refund - in case it is found that decreeholder is liable for irregularity which led to sale being set aside then court may in appropriate proceedings direct refund. - - in england as well as in this country, this fee is..........who rejected an applications made by a third party court auction purchaser for refund of the poundage paid by him on the sale being set aside on an application under or. 21 rule 90 c.p.c. the petition was headed 'under section 151, or. 21 rule 93 and section 47 c.p.c'. of course section 47 c.p.c. cannot apply in this case, the petitioner not being a party to the proceedings. so far as o. 21, r. 93 is concerned, even that in my opinion cannot apply to this case. it runs:'where a sale of immoveable property is set aside under rule 92, the purchaser shall be entitled to an order for repayment of his purchase money, with or without interest as the court may direct, against any person to whom it has been paid'.it is nobody's case that the poundage is paid to any other party. it is.....
Judgment:
ORDER

(1) This revision has been preferred against an order of the learned Subordinate Judge of Tuticorin, who rejected an applications made by a third party court auction purchaser for refund of the poundage paid by him on the sale being set aside on an application under Or. 21 rule 90 C.P.C. The petition was headed 'Under Section 151, Or. 21 rule 93 and Section 47 C.P.C'. Of course Section 47 C.P.C. cannot apply in this case, the petitioner not being a party to the proceedings. So far as O. 21, R. 93 is concerned, even that in my opinion cannot apply to this case. It runs:

'Where a sale of immoveable property is set aside under rule 92, the purchaser shall be entitled to an order for repayment of his purchase money, with or without interest as the court may direct, against any person to whom it has been paid'.

It is nobody's case that the poundage is paid to any other party. It is certainly not paid to the decree holder or to the judgment debtor.

(2) As regards what is poundage, and to whom it goes there is a lucid exposition of it, if I may say so with respect, in a decision of this court in Parvathi Ammal v. Govindasami Pillai, ILR 39 Mad. 803:AIR 1916 Mad 290 thus:

'This argument proceeds on a misconception of the nature of the poundage fees. As was pointed out by Mr. Ramachandra Iyer in his able argument, what the purchaser claims is really a portion of the purchase money. It is from the payment made by him the court makes a deduction for poundage and pays the balance to the decreeholder. Poundage is the fee levied in England by the Sheriff as remuneration for his service. In this country, as the officers of the court conducting the sales are paid a fixed salary, a certain percentage of the purchase money is taken for purchasing stamps. In effect the fee is a charge paid by the decreeholder for the services he obtains from the court. In England as well as in this country, this fee is taken out of the sale proceeds'.

(3) The other relevant rule which may be referred to is rule 203 of the Civil Rules of Practice. This rule runs:

'1. If the sale is set aside under Or. XXI rule 89 C.P.C. the court may make an order for payment by the judgment debtor of the poundage and other costs and interest, if any, not covered by the proclamation of sale.

2. If the sale is aside under Or. XXI rule 90 of the Code, the court shall determine whether any and what party is responsible therefor and may order such party to pay the costs and expenses of the sale and may make an order that any other party entitled to have the property sold may have the conduct of the sale and may make an order for the resale of the property.

3. If the sale is set aside under Or. XXI rule 91 of the Code, the court may make an order for payment by the execution creditor of the poundage and other costs of the sale'.

So far as the setting aside of a sale under Or. 21 rule 89 is concerned, there can be no difficulty as the amount deductible for poundage from the deposit made by the purchaser could be refunded to him, when the sale is set aside thereunder pursuant to rule 203 (1). The difficulty comes in when the sale is set aside under Or. 21 Rule 90 C.P.C. Even assuming that the order of the court under this rule for payment of costs and expenses could include also the poundage, the court has to give a definite finding as to the party who is responsible for the sale being set aside under Or. 21 Rule 90 C.P.C. In the present case, the finding is that it cannot be said that the execution creditor was in any way responsible for the sale being set aside. On this finding assuming that the court has a power, it must be held that no order could be made in favour of the auction purchases in this case.

(4) It may however be pointed out that in ILR 39 Mad 803: AIR 1916 Mad 290 it was held that a suit could be laid by the purchaser against the decreeholder for the poundage fees not returned to him and interest on the purchase money paid by him. Dealing with the duties of a decreeholder it is pointed out that it is the duty of the decreeholder to put the court in possession of the necessary information and to attend to the various requirements of the law in publishing and conducting the sale. It was observed that the court cannot be proceeded against for the irregularity in execution, if it acted to the best of its information and without malice, and that the party who puts the court in motion, is liable to the purchaser, who has been aggrieved. Where a sale has gone through the poundage is taken by the court under its powers for the expenses incurred for the sale, and if for any reason an auction purchaser is aggrieved by an irregular sale, he could proceed only against the decreeholder, who had put the court in motion. Of course, to make the decreeholder liable there must be a specific finding that the sale was set aside because of default on his part.

(5) My attention was drawn to another decision of this court is Veeraraghavalu v. Chengalamma, AIR 1934 Mad. 409. That was a case where the sales in execution of a mortgage decree were held to be nullities, there being no valid final decree in existence at the time when the sales were held. At page 409, Curgenven J observed:

'Inasmuch as there was no final decree under which sales in execution could be held there can, I think, be little doubt that the sales themselves were nullities and upon this footing the case has been argued. The consequences of setting aside the sales under Or. 21 rules 89, 90 and 91 C.P.C. are dealt with in Civil Rules of Practice Nos. 201 to 203, but these rules do not contemplate in any of these cases the making of a refund of the poundage on the part of the Government to a person by whom it has been paid or where it has been taken from the purchase money. There appears in fact to be no statutory power vested in the court to enable it to make an order for the refund of poundage in any circumstances, and if such a power exits it must be derivable from the inherent power saved under Section 151, C.P.C.'

After referring to the decision in ILR 39 Mad. 803: AIR 1916 Mad 290). the learned Judge observed.

'In effect the fee is a charge made against the decreeholder for the services he obtains from the court in holding the sale. Once that sale has been held it is not clear whether any means exist for obtaining a refund of the fee. In these civil revision petitions accordingly I do not feel prepared to say that in deciding not to grant the refund, although the learned Subordinate Judge was perhaps wrong in thinking that the cancellation of the sale was made under Or. 21 Rule 90, he has actually refused to exercise his jurisdiction, because I am not satisfied that he indeed had jurisdiction to direct such a refund. The most that could be done in such a case would be to give a certificate to the party that the case was a fit one for a refund and leave it to the revenue authorities to comply with it. That is no more than a recommendation. But I am not at all clear that the revenue authorities would consider themselves to have authority to make such a refund'.

In this case there can be no question, even though the court may grant a certificate under its inherent powers of granting a certificate. In the above case the sale was held when there was no valid final decree in existence, there was no valid final decree in existence, and the fault was not of the decreeholder nor of the judgment debtor. In such a case it may be desirable in the interests of justice to grant a certificate, so that the revenue authorities may consider it. But when in pursuance of a valid decree, a sale has gone through and the sale is only violable and not void and such a sale is set aside under Or. 21, rule 90 there cannot be a grant of a certificate for refund. If it is found that the decreeholder is liable for the irregularity which led to the sale being set aside, no doubt the court may, when it is approached in appropriate proceedings, direct the refund ILR 39 Mad, 803: AIR 1916 Mad 290, above referred to holds that it will be open to the auction purchaser to proceed by way of a suit against the decreeholder. In his case it cannot be said that the court erroneously refused to exercise its inherent powers to direct a refund, particularly in view of the finding that the execution creditor was not in any way responsible for the sale being set aside.

(6) In the result the revision petition falls and is dismissed. No costs.

(7) Revision dismissed.


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