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V.T. Veerappa Chettiar Vs. P.S. Palaniappa Chettiar - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberCivil Revn. Petn. No. 806 of 1972
Judge
Reported inAIR1973Mad313; (1973)1MLJ316
ActsBihar Land Reforms Act; Code of Civil Procedure (CPC), 1908 - Sections 63
AppellantV.T. Veerappa Chettiar
RespondentP.S. Palaniappa Chettiar
Cases ReferredDhirendra Rao Krishna Rao v. Virabhadrappa
Excerpt:
property - ratable distribution - sections 63 and 73 of code of civil procedure, 1908 - whether respondent entitled to ratable distribution under section 73 - as per section 73 application for execution of decree should have been taken in court which received and held assets - execution application was taken out by respondent not before court which received and held assets but before different court - held, respondent not entitled to ratable distribution. - - the following conditions have to be satisfied before section 73 civil p......he took out an execution application and had the property attached on 23-6-1971. he applied for ratable distribution of assets in the sub-court. devakottai on 5-8-1971.4. as already stated after the sale in execution of the decree in o. s. 1 of 1970 the sale proceeds, a sum of rs. 1425 on 14-6-1971 and the balance of rs. 4275 on 25-6-1971 were deposited in the sub-court, devakottai, and the sale was confirmed on 17-7-1971. the auction purchaser in this case is the decree-holder in o. s. 581 of 1970 who got the decree transferred to the district munsif court attached the property in execution of the decree and who applied for ratable distribution of the assets. the lower court allowed the petition filed by the respondent holding that he is entitled to ratable distribution of the assets.....
Judgment:
ORDER

1. This petition is filed by one Veerappa Chettiar, respondent in E. A. 479 of 1971, against the order of the Subordinate Judge. Devakottai directing ratable distribution of the assets in court between him and the petitioner in E. A. 479 of 1971.

2. The petitioner herein filed the suit O. S. No. 1 of 1970 in the Sub-Court. Devakottai obtained a decree and brought the property to sale. The property was sold on 14-6-1971. On that day itself a sum of Rs. 1425 was deposited in court and the balance of Rupees 4275 was deposited on 25-6-1971. The sale was confirmed in favor of the auction purchaser on 17-7-1971.

3. The respondent herein filed the suit O. S. 581 of 1970 against the same judgment-debtor as in O. S. 1 of 1970 in the District Munsif Court of Melur and obtained a decree on 18-1-1971. He got the decree transferred to the District Munsif Court, Devakottai, on 10-6-1971. He took out an execution application and had the property attached on 23-6-1971. He applied for ratable distribution of assets in the Sub-Court. Devakottai on 5-8-1971.

4. As already stated after the sale in execution of the decree in O. S. 1 of 1970 the sale proceeds, a sum of Rs. 1425 on 14-6-1971 and the balance of Rs. 4275 on 25-6-1971 were deposited in the Sub-Court, Devakottai, and the sale was confirmed on 17-7-1971. The auction purchaser in this case is the decree-holder in O. S. 581 of 1970 who got the decree transferred to the District Munsif Court attached the property in execution of the decree and who applied for ratable distribution of the assets. The lower court allowed the petition filed by the respondent holding that he is entitled to ratable distribution of the assets in the Sub-Court, Devakottai. The question that arises for consideration in this revision petition is whether the respondent is entitled to ratable distribution either under Section 63 or under Section 73. C. P. Code. The decree-holders who in execution of their decrees in more than one court have attached the same property of the judgment-debtor not in the custody of any court can claim the benefit of Section 63 C. P. C. The highest court between the courts in which the property is attached, or, if there is no difference in grade between such courts, the court under whose decree the property was first attached will decide the claims of the attaching decree-holders. In order to apply Section 63. C. P. C. the same property of the judgment-debtor should have been attached by decree-holders in more than one court. In this case it is common ground that the respondent herein attached the property in dispute on 23-6-1971 after the property was sold on 14-6-1971 the sale was confirmed on 17-7-1971. The contention of Mr. Rajagopala Iyer, the learned counsel for the respondent is that, as the auction purchaser who purchased the property on 14-6-1971 had no vested right on the date of sale the subsequent attachment by the respondent after the date of the sale but before its confirmation would confer right on the respondent and he could enforce his decree against the property. I cannot agree Section 65 C. P. Code provides that when immovable property is sold in execution of a decree and such sale has become absolute the property shall be deemed to have vested in the purchaser from the date when the property is sold and not from the date when the sale becomes absolute. Under Section 65 C. P. C., the title in the property sold in a court sale vests in the purchaser from the date of sale only after the confirmation of the sale though the confirmation of the sale is on a date subsequent to the date of sale. The validity of a Court sale can be questioned under the provisions of Order 21, Rules 89 to 91. If the challenge is not successful the sale is confirmed under Order 21, Rule 92 Civil P. C. and the confirmation of the sale relates back to the date of the sale.

Mr. Rajagopala Iyer referred to the decision in Ramachandra Bhagat v. Mrs. Eva Mitra : AIR1960Pat378 and contended that where the property has been sold but before the confirmation of the sale the interest of the mortgagor vested in the State the auction purchaser would not derive any benefit. What happened in the case cited was that after the sale of the proprietary interest in execution of a mortgage decree, the Bihar Land Reforms Act came into force and according to the provisions of clauses (d) and (e) of Section 4 of the Act all suits and proceedings for recovery of money which may be pending on the date of the vesting were to be dropped. Therefore, the Court in that case could not proceed with the confirmation of sale, and the sale was not confirmed. Section 65 Civil P. C. would not be applicable to the facts of that case. Mr. Rajagopala Iyer's contention is that the decision cited is authority for the proposition that the purchaser's title is inchoate and therefore, any intervention of subsequent event which takes away the right of the mortgagor will not confer any right on the auction purchaser even on the date of sale. Whatever may be the nature of the right of the purchaser in Court sale on the date of sale once the sale is confirmed under Order 21, Rule 92, the title in the property sold vests in the purchaser from the date of sale and whatever has happened subsequent to the date of sale cannot in any way affect the right of the purchaser. In this case the sale had been confirmed on 17-7-1971 and it relates back to the date of sale on 14-6-1971. Therefore, the subsequent attachment of the property by the respondent on 23-6-1971 would not confer any right on the respondent. Nor can he claim any benefit under Section 63, Civil P. C.

5. The question now arises whether the respondent is entitled to ratable distribution under Section 73, Civil P. C. Section 73, Civil P. C. provides that where assets are sold by a Court and more persons than one have before the receipt of such assets, made application to the Court for the execution of the decrees for the payment of money passed against the same judgment-debtor and have not obtained satisfaction thereof, the assets after deducting the costs of realization shall be ratable distributed among all such persons. The following conditions have to be satisfied before Section 73 Civil P. C. can be applied;(1) The decree-holder claiming ratable distribution should have applied for execution of his decree to the appropriate Court;(2) such application should have been made prior to the receipt of the assets by the Court.(3) The assets of which a ratable distribution is claimed must be assets held by the Court.(4) The decree-holder should be holder of a decree for the payment of money.(5) Such a decree should have been obtained against the same judgment-debtor. In the instant case, the sale proceeds of the property deposited in the Sub-Court, Devakottai, are the assets held by the Court. The contention of Mr. Rajagopala Iyer is that the respondent had applied for execution of his decree before the assets were received by the Court and the respondent is entitled to the benefit of ratable distribution under Section 73. Civil P. C. It is not disputed that the respondent in this case had applied for execution of his decree on 23-6-1971 in the District Munsif Court. Devakottai, before the assets of Rs. 4,725, were received by the Sub Court, Devakottai. But the question is whether the respondent had applied is whether the respondent had applied to the proper Court for ratable distribution before the assets were received and held by the Court. A reading of Section 73(1) shows that the application for execution of decree should have been made to the Court, before it received and held the assets. An application for execution of decree made to any Court other than the Court which received the assets would not be a sufficient compliance with the requirement of Section 73. The wording of the section, is 'Where assets are held by a Court and more persons than one have before the receipt of such assets, made application to the Court for execution' which means that the application for execution of the decree should be made to the Court before it received and held that assets. Mr. Rajagopala Iyer submits that under Section 73 read with Section 63. Civil P. C., an attaching decree holder is entitled to ratable distribution even though he has applied for execution of his decree in a different Court. As already pointed out, Section 63 states as to how the claims of several attaching decreeholders should be determined. Under that section if the decreeholders had attached the property that had been sold and the sale proceeds realized the distribution may be according to the provisions of Section 73. But Section 63 cannot be invoked, if the decreeholders had not attached the property. Section 73 stands by itself and relates to distribution of assets in Court, whether the property had been attached by the concerned decreeholder or not. For the application of Section 73 the property need not be attached; but an application for execution of the decree should have been taken in the Court which received and held the assets. Section 73 cannot be construed in such a way as to enable all the decreeholders who have taken execution applications in different Courts, to claim ratable distribution of assets received and held in one Court. Such a construction is not warranted. Nor is it workable, for the Court which has received and held the assets may not know the number of applications made for execution of decrees in various Courts. In this case the execution application was taken out by the respondent not before the Sub Court Devakottai, which received and held the assets, but before a different Court, namely, District Munsif Court, Devakottai.

Mr. Rajagopala Iyer submitted that, after amendment was introduced in Section 73. Civil P. C., the view taken by some Courts is that Section 73, Civil P. C. will be applicable even if applications for execution of decrees are taken out in different Courts. In support of his contention, the learned counsel relied on the decision in Dhirendra Rao Krishna Rao v. Virabhadrappa, ILR 59 Bom 310= AIR 1935 Bom 176. In that case it has been held that Section 63, Civil P. C. does not determine the principle on which the Court is to act in determining claims of persons who have obtained attachments in execution of the decrees of inferior Courts to ratable distribution of the proceeds of sale, and it only lays does which Court is to decide the question. It has also been held in that case, that in determining whether ratable distribution is to be allowed or not the Court has to look at Section 73, that in a case such as the present. Section 63 and 73 and must be read together and that when so read, the true construction of Section 73 is that an application need only have been made to the Court which granted the decree before the receipt of the assets and need not be made to the Court which holds such assets. In other words 'that the Court to which application for execution must be made' means the appropriate Court and includes an inferior Court which granted a decree to be executed. In that case the Court was dealing with the provisions of Sec. 63 and referred to Section 73 for distribution of the assets, when Section 63 was found inapplicable. In fact the Court observed 'but we are not concerned in this case with the construction of Section 73 except in a case which is dealt with by the Court under Section 63', though earlier the Court stated that it was not so clear in the present section that the Court to which an application had to be made must be the Court which held the assets and might not be the Court which granted the decree. Therefore, the decision cannot conclude the matter in favor of the respondent.

6. In the result, I accept the contention of Mr. Venkataramani the learned counsel for the petitioner, and hold that in the circumstances of the case, the respondent is not entitled to ratable distribution. The petition is allowed with costs.

7. Petition allowed.


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