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Parvathi Ammal Vs. Govindasami Pillai - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Judge
Reported inAIR1916Mad290(2); (1916)ILR39Mad803; 30Ind.Cas.827
AppellantParvathi Ammal
RespondentGovindasami Pillai
Cases ReferredSee Raghubar Dayal v. Bank of Upper India Limited
Excerpt:
civil procedure code (act v of 1908,), order xxi, rule 93 - civil procedure code (act xiv of 1882), section 315--execution sale set aside--purchaser, suit by, against decree-holder for poundage deducted from purchase-money as well as for interest on amount of purchase-money deposited, maintainability of--poundage, what is. - - the court cannot be proceeded against for irregularity in execution, if it acted to the best of its information and without malice. in england as well as in this country, this fee is taken out of the sale-proceeds......xiv of 1882 'that the purchaser shall be entitled to receive back his purchase-money' may confer a right of suit as held in numerous cases but that the words 'shall be entitled to an order for re-payment' in rule 13 indicates a deliberate policy to restrict the remedy to execution in all cases of sales being set aside. we are unable to see the distinction. there are no words in the present code, as in the code of 1882, enabling the purchaser to realise his money by way of execution. further, he is no party to the suit or the decree. unless, therefore, his right of action is taken away by express words, he is entitled to pursue his ordinary remedy by filing a suit.5. another contention of the appellant was that as poundage is taken by the court, the decree-holder is not bound to pay it to.....
Judgment:

1. The facts of the case are not in dispute. The defendant obtained a decree against certain persons. Immoveable properties were sold under that decree, and the plaintiff became the purchaser. At the instance of the judgment-debtors the sale was set aside on the ground of irregularities in the conduct of the sale. Plaintiff, the purchaser, sued to recover the amount of the poundage fee deducted from the purchase-money paid by him, and also interest. The claim for Vakils' fees, etc., has not been pressed before us. The District Munsif held that plaintiff was entitled to interest at 6 per cent, and that a separate suit does not lie to recover poundage. Both the parties appealed. The Subordinate Judge held that the claim for poundage was sustainable, but that interest should not have been decreed. Second Appeal No. 1127 of J 914 is by the defendant against the decree for poundage. Second Appeal No. 1147 of 1914 is by the plaintiff for the interest disallowed.

2. Before dealing with the question of law argued before us, we may state that we see no reason to differ from the conclusion of the Courts below that defendant is responsible for the irregularities in the conduct of the execution sale. In the order passed on the application of the judgment-debtor, the Subordinate Judge held 'that the decree-holder was responsible for the material irregularity in publishing or conducting the sale.' (See paragraph 9 of the District Munsif's judgment.) The District Munsif in the present suit came to the same conclusion-apparently the liability of the defendant was not disputed in appeal. It is true the Court in ordering the sale of the property should have directed the amin to sell the property in different lots, but that would not absolve the defendant from his liability. The responsibility of the officer leaving execution in the mofussil is not that of the Sheriff in England. It is the duty of the decree-holder 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. The Court cannot be proceeded against for irregularity in execution, if it acted to the best of its information and without malice. The party who puts the Court in motion is liable to the purchaser who has been aggrieved. Even in Sheriff's sales, the purchaser is entitled to proceed against the decree-holder. In Dorab Ally Khan v. Executor of Khajah Moheeoodeen 5 I.A. 116: 2 Ind. Jur. 426 in which the Judicial Committee had to pronounce upon the liability of the Sheriff who executed a decree of the original side of the Calcutta High Court, it was pointed out that the Sheriff may render himself liable if he seized the property situated beyond his territorial jurisdiction, or if he exceeded the powers expressly conferred on him by the State. Their Lordships have also laid down that where the Sheriff acts under the advice and guidance of the execution creditor, the latter will be responsible to the purchaser. The present is an a fortiori case.

3. The main Question argued related to the maintainability of the suit. Mr. Ganapathi Aiyar contended that the plaintiff should have sought redress in execution and that a separate suit does not lie. Section 315 of Act XIV of 1882 provided for two classes of cases: (1) where the sale has been set aside as provided for in the Code and (2) where it was found that the judgment-debtor had no saleable interest in the property sold. The present Code contains no provision regarding the right of the purchaser to obtain a refund of his purchase-money without applying to set aside the sale, when it is subsequently found that the judgment-debtor had no saleable interest in the property. It may be, as suggested by Mr. Ramachandra Aiyar for the respondent, that unless the purchaser seeks the aid of the Court to set aside the sale, he has no remedy against the decree-holder. It was laid down by the Judicial Committee in Dorab Ali Khan v. Executors of Khajah Moheeoodeen 5 I.A. 116 that there was no warranty of title in Court sales. See also Sundara Gopalan v. Venkata-varada Ayyangar 17 M.k 228. The right of action to obtain a refund consequent on the want of saleable interest in the judgment-debtor is not a right inhering in a purchaser, but is only the creature of a Statute and the right thus conferred can only be exercised within the limitations prescribed. Consequently, without getting the sale set aside through Court, the purchaser has no right of action. The general principle of caveat emptor would affect the purchaser unless lie chooses to adopt the remedy given him by the Statute. But the right to recover from a party whose fraud or carelessness has led to the invalidity of the sale stands on a different footing. In such cases by neglecting the duty cast on him, he renders himself liable to compensate the injured party for the loss the latter has sustained. The right is not created for the first time by the Statute. The Code only recognised what has existed all along. As stated by Sir James Bacon (Vice-Chancellor) in Powell v. Powell 19 Eq. Cas. 422 : 32 L.T. 148 the purchaser is entitled under these circumstances to be discharged from his contract by reason of the invalidity of the proceedings which led up to the sale and is entitled to be placed in status quo ante. The same proposition is stated in 24 Cyclopedia of Law and Procedure 70, thus:

It is generally held that when the proceedings are invalid, so that the purchaser loses the land, title to which he would have had but for the defects in the proceedings he is entitled to recover back the purchase-money paid by him, and to be reimbursed for money expended by him for taxes and on repairs and improvements that have increased the value of the land.

4. The decision in Mohideen Ibrahim v. Mahamed Meera Levvai 19 C.k 683 on which the appellant relied strongly, does not touch the present question. Mr. Justice Napier held in that case that where the purchaser was deprived of the possession by reason of a decision in a subsequent suit, he is not entitled to sue for the return of the purchase-money. The omission from the Code of 1908 of the clause relating to the want of saleable interest' in the judgment-debtor is relied on strongly by the learned Judge. In the present case the sale has not become abortive owing to the absence of saleable interest in the judgment-debtor. Mr. Ganapathy Aiyar contended that the words of Section 315 of Act XIV of 1882 'that the purchaser shall be entitled to receive back his purchase-money' may confer a right of suit as held in numerous cases but that the words 'shall be entitled to an order for re-payment' in Rule 13 indicates a deliberate policy to restrict the remedy to execution in all cases of sales being set aside. We are unable to see the distinction. There are no words in the present Code, as in the Code of 1882, enabling the purchaser to realise his money by way of execution. Further, he is no party to the suit or the decree. Unless, therefore, his right of action is taken away by express words, he is entitled to pursue his ordinary remedy by filing a suit.

5. Another contention of the appellant was that as poundage is taken by the Court, the decree-holder is not bound to pay it to the purchaser. This argument proceeds on a misconception of the nature of the poundage fees. As was pointed out by Mr. Ramachandra Aiyar 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 decree-holder. Poundage is the fee which is levied in England by the Sheriff as remuneration for his services. 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 decree-holder 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. See paragraph 71 in 14 Halsbury's Laws of England and Rule 154 of the Civil Rules of Practice. There is, therefore, no warrant for the suggestion that in claiming the money retained as poundage fee, the purchaser does not ask for the return of the purchase-money. Nor do we see any reason to assent to the argument that the claim for the recovery of such fees should be disposed of in execution. The omission of the word 'poundage' in Rule 157, Clause (2), was much relied on. This omission cannot affect the substantive right of suit which the purchaser has. It was held in Rawstorne v. Wilkinson 4 M. & S. 256 that the Sheriff has a right of action to recover poundage fees where the sale proves abortive. See also Tyson v. Paske 2 Raym. 1212. The auction-purchaser whose money has been paid by way of poundage to the Sheriff will stand in his shoes to recover it against the execution creditor. The fact that it is retained by the Court can make no difference in principle. We have, therefore, come to the conclusion that the Subordinate Judge was right in holding that the suit is not obnoxious to the execution provisions of the Code of Civil Procedure. We dismiss Second Appeal No. 1127 of 1914 with costs.

6. We are, however, unable to agree with the lower Appellate Court that the purchaser has lost his right to interest by any laches on his part. He is under no duty to see that the property is put up for sale in separate lots. He is not affected by any anterior mismanagement in the conduct of the sale. He has to take the property as advertised and sold. As he paid the money required by law, there is no reason for depriving him of the interest on his money. See Raghubar Dayal v. Bank of Upper India Limited (1883) A.W.N. 51. The rate of interest awarded by the Munsif is correct. We must reverse the decree in Second Appeal No. 1147 of 1914 with costs in this and in the lower Appellate Court and give a decree for Us. HOG with interest at 6 per cent, from the date that the plaintiff deposited the money into Court.


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