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Bobba Varalakshmamma Vs. Kosaraju Jannayya - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai
Decided On
Reported inAIR1943Mad318; (1943)1MLJ62
AppellantBobba Varalakshmamma
RespondentKosaraju Jannayya
Cases ReferredMrs. J. Peliti v. Kanshi Gopal A.I.R.
Excerpt:
.....filed two applications for setting aside the sale on the ground that the auction-purchaser decree-holder had not deposited the requisite amount payable for the purchase within 15 days from the date of the sale. evidently it was a precautionary measure taken by him to save time in case he should fail in the appeal filed by him against the order setting aside the sale. the decree-holder appellant had to keep alive the execution petition so that he may have his remedy by bringing the properties to sale in case he should fail in the appeal. if he succeeds in appeal then the sale will be confirmed and the subsequent proceedings will automatically become invalid because the decree will be satisfied by the confirmation of the sale. when a party has necessarily to seek another remedy in..........in o.s. no. 53 of 1935 on the file of the district munsiff's court of masulipatam. it was a simple money decree. the properties of the judgment-debtor were attached and sold in a court sale held-on the 2nd july, 1936. the decree-holder had obtained permission to bid and set off and his bid for rs. 1,562 was accepted. the amount shown in the sale proclamation as due under the decree was rs. 1,010. on the date of the sale he deposited into court rs. 390-8-0. on 11th july, 1936, he deposited a further amount of rs. 161-8-0 which represented the balance payable by him to make up the difference between the amount for which he purchased and the amount realisable under the sale proclamation.2. another creditor of the judgment-debtor, who is the 1st respondent in the civil revision petition,.....
Judgment:

Kuppuswami Ayyar, J.

1. These arise out of an application to execute the decree in O.S. No. 53 of 1935 on the file of the District Munsiff's Court of Masulipatam. It was a simple money decree. The properties of the judgment-debtor were attached and sold in a Court sale held-on the 2nd July, 1936. The decree-holder had obtained permission to bid and set off and his bid for Rs. 1,562 was accepted. The amount shown in the sale proclamation as due under the decree was Rs. 1,010. On the date of the sale he deposited into Court Rs. 390-8-0. On 11th July, 1936, he deposited a further amount of Rs. 161-8-0 which represented the balance payable by him to make up the difference between the amount for which he purchased and the amount realisable under the sale proclamation.

2. Another creditor of the judgment-debtor, who is the 1st respondent in the Civil Revision Petition, laid a claim for rateable distribution of the assets realised. It was ultimately found that Rs. 601-2-3 was due to her. On the 3rd July itself the decree-holder evidently coming to know that there was a claim for rateable distribution filed a petition offering to deposit of Rs. 161-8-0 after giving effect to the set off and wanted the Court to let him know what further amount will have to be paid to make up the amount necessary to pay the other creditors by way of rateable distribution. The Court passed an order ' petitioner may deposit only that amount required for payment to decree-holders who applied for and are entitled to rateable distribution of the assets.' This order is dated 11th July, 1936 and no time was fixed for payment of the additional amount payable to the rateable decree-holders.

3. On the 1st August, 1936, the other creditor as well as the judgment-debtor filed two applications for setting aside the sale on the ground that the auction-purchaser decree-holder had not deposited the requisite amount payable for the purchase within 15 days from the date of the sale. It was also stated that there were other irregularities in the sale. On 17th October, 1936, the amount due to the other creditor was fixed at Rs. 601-2-3 and the balance of the amount due to the creditor entitled to share rateably in the assets realised by the sale was deposited by the decree-holder auction-purchaser on 22nd October, 1936. The learned District Munsiff, three years later, passed an order setting aside the sale on the ground that it was the duty of the auction-purchaser decree-holder to have deposited within 15 days the money payable to the other decree-holder entitled to a share rateably in the assets realised by the sale and as that was not done he set aside the sale. No evidence appears to have been let in with regard to the irregularities mentioned in the petition and the learned District Munsiff has not dealt with them. On appeal the learned Subordinate Judge agree with the learned District Munsiff and dismissed the appeal.

4. Subsequent to the setting aside of the sale the decree-holder took steps in the ' execution proceedings for bringing the properties to sale. Evidently it was a precautionary measure taken by him to save time in case he should fail in the appeal filed by him against the order setting aside the sale. But before the properties were brought to sale the judgment-debtor deposited the decree amount on 25th August, 1939. The learned Subordinate Judge of Masulipatam held that the conduct of the decree-holder in having taken steps in execution subsequent to the setting aside of the sale for bringing the properties to sale again, disentitled him to continue the appeal for setting aside the order cancelling the sale.

5. Hence this appeal. I do not think that the learned Subordinate Judge was justified in finding that under Rules 84 and 85 of Order 21 of the Code of Civil Procedure it is the duty of the decree-holder auction-purchaser to pay Within 15 days from the date of sale that portion of the amount that may be payable' rateably to the other creditors who may claim a share in the assets realised by the sale over and above the amount deposited by him into Court representing the difference between the amount for which he purchased the properties and the amount due to him under his decree. In this case permission to bid and set off had been obtained by the decree-holder. Under Order 21, Rule 84, Civil Procedure Code, 25 per cent. of the amount of the purchase money should be deposited on the date of the sale. This the auction-purchaser has done. Under Rule 85, the full amount of purchase money payable and the amount required for the general stamp should be paid by the purchaser within 15 days from the date of the sale. There is a proviso to that rule which says that in calculating the amount to be so paid the purchaser shall have the advantage of any set off to which he may be entitled under Rule 72. In this case, since the appellant had obtained the permission of the Court to set off the amount, he was entitled to set off the entire amount due to him under the decree as against the balance of purchase money that may be payable by him after deducting 25 per cent. of the amount which was deposited by him on the date of the sale itself. It was urged before the lower Court that under Rule 199 of the Civil Rules of Practice a decree-holder purchaser who obtained permission to set off will have to deposit the money payable to the several decree-holders entitled to rateable distribution. But that rule does not say when that amount should be deposited. In Murugappa Chettiar v. Ramaswami Chettiar I.L.R.(1935) Mad. 342 this Court had to consider the validity of that rule and it was held by Venkatasubba Rao, J., that it was ultra vires to the extent to which it was in contravention of Rules 84 and 85 of Order 21, Civil Procedure Code. In that case the contention was that it was the duty of the auction-purchaser if he happened to be the decree-holder to deposit the entire purchase money whenever there was any other creditor entitled to claim a rateable distribution of the assets. His Lordship held that it was not so and that Rule 199 of the Civil Rules of Practice to that extent was ultra vires as it went against the provisions of Order 21, Rule 85. But his Lordship held that such an auction-purchaser will be bound to deposit the money payable to the creditors entitled to claim rateable distribution but it was not stated when that has to be paid.

6. It was taken by both the lower Courts that the money should be deposited within 15 days from the date of sale as it was purchase money. As the rateable distribution has to be made out of the assets realised at the sale and as the balance of purchase money as per Order 21, Rule 85, C. P. Code, even after setting off the amount which the decree-holder in law is entitled to set off should be paid within 15 days it was considered the amount payable to the other creditors should be deposited within these 15 days. That it is not necessary that the amount payable to the creditors entitled to rateable distribution should be paid within 15 days of the sale is clear from the ruling in Madden v. Chappani I.L.R.(1887) Mad. 356. There it was pointed out that a creditor entitled to claim rateable distribution has a summary remedy to proceed against the decree-holder auction-purchaser to realise his amount. If such amounts have to be deposited within 15 days from the date of the sale, then there could be no necessity for this summary remedy. The very fact that this Court held that he was entitled to a summary remedy indicates that the amount need not be deposited within 15 days. Since neither Rule 199 of the Civil Rules of Practice nor the observations in Murugappa Chettiar v. Ramaswami Chettiar I.L.R.(1935) Mad. 342 state that such an amount is payable within 15 days from the date of the sale, and since the remedy open to a creditor entitled to rateable distribution is inconsistent with the contention that such money should be deposited within 15 days from the date of the sale, I find that both the lower Courts were wrong in finding that the non-payment of the money payable to the creditor entitled to rateable distribution within 15 days from the date of the sale justifies the setting aside of the sale. '

7. With regard to the other point on which the learned Subordinate Judge has held that the appellant is not entitled to pursue his remedy in appeal, he has proceeded on the basis that the remedy he sought by taking proceedings in execution for bringing the properties to sale on 28th February, 1939, was inconsistent with his claim in the appeal and that where a party has two remedies which are not 1 co-existent but alternative if he chose to seek one remedy he will be barred from I seeking the other. The correctness of this proposition of law is not disputed by the counsel for the appellant but what is stated is that that principle cannot be applied to the facts of this case. The decree-holder appellant had to keep alive the execution petition so that he may have his remedy by bringing the properties to sale in case he should fail in the appeal. If he succeeds in appeal then the sale will be confirmed and the subsequent proceedings will automatically become invalid because the decree will be satisfied by the confirmation of the sale. When a party has necessarily to seek another remedy in case he failed to get the relief which he sought for earlier and if he takes such proceedings, it cannot be said that during that period he will not be justified in taking steps to secure the later remedy to which he would be entitled in case he failed to obtain the relief in the earlier proceedings; and that is the position of the appellant in this case. I therefore do not think it can be said that merely because the appellant pursued his remedy on the basis that the sale had been set aside he will not be entitled to contend in the appeal that the order setting aside the sale is invalid and that the sale will have to be confirmed.

8. It is further stated that there is an order entering satisfaction of the decree by reason of the deposit made by the judgment-debtor and that therefore the appeal which can be proceeded with only on the basis that the decree has not been satisfied is not maintainable. But the appellant is not responsible for the deposit of the money by the judgment-debtor. The judgment-debtor voluntarily paid the amount into Court to avoid the continuation of the proceedings in execution of the decree. The decree-holder has not drawn the amount from Court. The case reported in Mangat Rai v. Duli Chand I.L.R.(1933) All. 735 which is relied on by the respondent has no application to the facts of this case, because there the decree-holder received the amount from the judgment-debtor and therefore there was satisfaction of the decree by his electing to receive the amount. In this case the appellant has not received the amount but protested against the decree being satisfied by the judgment-debtor, depositing the amount in view of the fact that he had filed the appeal for setting aside the order cancelling the sale and therefore he cannot be estopped from claiming his remedy in the appeal.

9. It is urged for the respondent that the Civil Miscellaneous Second Appeal is not maintainable in view of the decision in Mrs. J. Peliti v. Kanshi Gopal A.I.R. 1939 Lah 210 but their Lordships find that the decree-holder was in the position of the auction-purchaser and the dispute between the auction-purchaser and the judgment-debtor was not a matter relating to the execution and satisfaction of the decree. This Court has throughout held that the question between a decree-holder purchaser, and the judgment-debtor is a matter relating to the execution of the decree and therefore any question between them comes within the purview of Section 47, C. P. Code. As a matter of fact as per the rulings of this Court, Section 47, C.P. Code, is a bar to a suit by a decree-holder auction-purchaser for recovery of possession of properties purchased by him. He has to file the petition within three years from the date of sale to obtain delivery of possession of the properties. I do not think therefore I will be justified in holding that no appeal lies against the order passed in the appeal filed by the judgment-debtor.

10. The petition filed by the creditor claiming rateable distribution was also allowed and the appellant has filed the civil revision petition against that order. I have already found that the District Munsiff had no jurisdiction to set aside the sale on the ground that the decree-holder auction-purchaser had not deposited the, amount payable to the creditor entitled to a share in the assets realised by the sale. The order being one passed without jurisdiction has to be set aside.

11. It is urged for the respondents that I should remand the petition to the lower Court for disposal of the other objections raised by the parties. But then no evidence had been let in on the other objections and it does not appear from the judgments of either the first Court or the appellate Court that this was treated as a preliminary point or the parties were prevented by the Court from letting in the necessary evidence with regard to the irregularities. I therefore do not think I will be justified six years after the sale to direct a fresh enquiry into the irregularities alleged.

12. In the result both the appeal and the petition are allowed, and the order of the Subordinate Judge and the District Munsiff setting aside the sale is set aside. The sale will be confirmed.

13. In C. M. S. A. No. 260 of 1940 the respondent will pay the appellant his costs in all the three Courts. I make no order as to costs in all the three Courts in the Civil Revision Petition.

14. Leave refused.


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