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Karuppanna Goundan Vs. Ponnuthayee Alias Subbammal and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1956)1MLJ190
AppellantKaruppanna Goundan
RespondentPonnuthayee Alias Subbammal and ors.
Cases ReferredPodila Venkanna v. Chinchindara Venkanna
Excerpt:
.....for decision was whether an application under order 21, rule 90, civil procedure code, without the auction-purchaser being made a party to it was bad in form. if an order either confirming the sale or setting it aside cannot be made without notice being given to the auction-purchaser it automatically follows that he is a necessary party and we are, therefore, clearly of the opinion that in any application to set aside a sale either before its confirmation or afterwards, the auction-purchaser must be heard and as such he must be deemed to be a necessary party to the application. , was of the opinion that though the application to set aside the sale in execution of the decree is primarily an application against the decree-holder since he is the person at whose instance the sale proceedings..........code, in a case in which no allegation or proof of fraud is made or established as against the auction-purchaser.the finding concurrently arrived at by both the lower courts is that the decree holder was guilty of fraud in that the judgment-debtors were kept out of knowledge about the sale in the execution proceedings by his act. order 21, rule 90, civil procedure code, makes it clear that an application under that rule can be made to set aside a sale on the ground of material irregularity or fraud in publishing or conducting it. it means that a material irregularity or fraud must be one antecedent to the sale. it is not likely in the majority of cases that the intending auction-purchaser would have played fraud in publishing or conducting the sale for at that stage he is nowhere in.....
Judgment:

Govinda Menon, J.

1. The question referred to the Bench is as follows:

Whether Section 18 of the Limitation Act can be invoked to give an extension of time to an application to set aside a sale under Order 21, Rule 90, Civil Procedure Code, in a case in which no allegation or proof of fraud is made or established as against the auction-purchaser.

The finding concurrently arrived at by both the lower Courts is that the decree holder was guilty of fraud in that the judgment-debtors were kept out of knowledge about the sale in the execution proceedings by his act. Order 21, Rule 90, Civil Procedure Code, makes it clear that an application under that rule can be made to set aside a sale on the ground of material irregularity or fraud in publishing or conducting it. It means that a material irregularity or fraud must be one antecedent to the sale. It is not likely in the majority of cases that the intending auction-purchaser would have played fraud in publishing or conducting the sale for at that stage he is nowhere in the picture and when the decree-holder himself becomes the purchaser and is guilty of fraud then the application would come within the purview of Section 47 of the Civil Procedure Code and not under Order 21, Rule 90.

2. That being the case the question has to be viewed from the standpoint as to who are the necessary parties in an application under Order 21, Rule 90, Civil Procedure Code, after the expiry of thirty days from the date of the sale after which in the absence of any application under Rule 80 or 90 of Order 21, Civil Procedure Code, or after an application is made and disallowed, the Court shall make an order confirming the sale whereupon the sale shall become absolute. Until the expiry of that period and the sale is confirmed in his favour, the auction-purchaser has not obtained any legal title to the properties sold and it is only an inchoate right which becomes fructified and crystallised when the sale becomes confirmed. Proviso to Sub-clause (2) of Rule 92, Order 21, lays down that no order setting aside the sale shall be made unless notice of the application has been given to all persons affected thereby. There was some argument at the Bar that this Proviso does not make it obligatory that the auction-purchaser is a necessary party to an application for setting aside a sale but is only a proper party and where it is intended to set aside the sale it would be sufficient if notice of the application is served on him on the footing that he is one of the persons affected by the application. In our view, the occasion for giving notice is before any order is passed on the petition. That is, it becomes necessary before an order setting aside the sale is made, that the auction-purchaser who is one of the persons affected thereby is heard. The state of things contemplated in Order 21, Rule 92, has reference to an application made within thirty days and this rule normally does not take into account an application after the sale has become absolute. If according to the Proviso to Sub-clause (2) of Rule 92, Order 21, it is necessary that the auction-purchaser is heard before an order setting aside the sale is made, he should be deemed to be a necessary party whose absence would invalidate any order passed without hearing him. If that is so, it is all the more necessary to hold that any application after the sale is confirmed for the invocation of Section 18 of the Limitation Act, must necessarily have as one of the parties the auction-purchaser whose rights by that time have become crystallsed and which would take effect from the date of the sale. Under these circumstances we do not find any difference as regards the necessity of the auction-purchaser being made a party to an application to set aside a sale between a case where an application is made before the sale is confirmed and the one where the application is made after the confirmation of the sale. At page 908 of Mulla's Civil Procedure Code (12th edition), the learned author in discussing the question of necessary parties observed a; follows:

Under the present Code the Proviso to Rule 92 would seem to imply that the auction-purchaser was a necessary party but it has been held that he need not be named as an opposite party in the applications and all that is necessary is that notice should be given to him before the sale is set aside under the Proviso to Section 92 which imposes a duty on the court to give him notice.

The learned author cites as authority for this proposition the decisions in Radhakishen Mahesri v. Tansukh Mahesri I.L.R. (1934)Cal. 286, Dip Chand v. Shea Prasad I.L.R. (1929) All. 910 and Nitai Dutta v. Bishun Lal Sao I.L.R. (1932) Pat. 504. All that the decision in Radhakishen Mahesri v. Tansukh Mahesri I.L.R. (1934) Cal. 286, lays down is that if for any reason the auction-purchaser is not impleaded at the time an application for setting aside the sale is made, it would be sufficient if before the sale is set aside, notice is given to him because he would be one of the persons affected by that order. The question that came up for decision was whether an application under Order 21, Rule 90, Civil Procedure Code, without the auction-purchaser being made a party to it was bad in form. Nowhere do the learned Judges lay down the proposition that the auction-purchaser is not a necessary party. To the same effect are the observations in the decision in Dip Chand v. Sheo Prasad I.L.R. (1929) All. 910 where it was held that Order 21, Rule 89 of the Civil Procedure Code does not require the applicant to nominate any person as the opposite party and it is not essential that there should be an application in writing in which the auction-purchaser must be shown as the opposite party, as a defendant is described in a plaint. Order 21, Rule 92(2) indicates that the duty of giving notice to all persons affected should rest on the Court or its officials, and there is nothing to indicate that the applicant for setting aside the sale should trace out who are the parties affected by his application and make them parties to it.

3. In Nitai Datta v. Bishun Lai Sao I.L.R. (1932) Pat. 504 the learned Judges laid down the principle that it is not essential to make the auction-purchaser a party to an application under Order 21, Rule 90, Code of Civil Procedure, because all that Order 21, Rule 92, provides is that no sale can be confirmed or set aside, unless notice of the application has been given to all the persons affected thereby and what the rule means is that the Court is incompetent to make any order at all till such notice is given.

4. They further lay down that although the law does require that the application under Order 21, Rule 90, should be made within thirty days of the sale, it does not impose any period of limitation for the issue of notice.

5. We do not propose to approve or question the correctness of the view that the auction-purchaser need not be added as a party within thirty days of the sale. But as he is one of the persons affected by the setting aside of the sale the Proviso enjoins the Court to issue notice to him. He is, therefore, a necessary party to the proceedings before the Court, whether added in the first instance or subsequently impleaded. If an order either confirming the sale or setting it aside cannot be made without notice being given to the auction-purchaser it automatically follows that he is a necessary party and we are, therefore, clearly of the opinion that in any application to set aside a sale either before its confirmation or afterwards, the auction-purchaser must be heard and as such he must be deemed to be a necessary party to the application.

6. But it is urged that as the fraud alleged is one in conducting or publishing the sale and as the auction-purchaser was not in the picture at that time as laid down in Jotindra Mohun Rai Chowdhury v. Brojendra Kumar Datta Munshi (1914) 24 Ind.Cas. 249, Section 18 of the Limitation Act cannot be invoked unless fraud was on the part of the auction-purchaser. In our opinion that makes no difference. In Podila Venkanna v. Chinchindara Venkanna (1950) I M.L.J. 471 Krishnaswami Nayudu, J., was of the opinion that though the application to set aside the sale in execution of the decree is primarily an application against the decree-holder since he is the person at whose instance the sale proceedings were initiated and for whose benefit the sale is held, person affected by setting aside the sale is not only the decree-holder but the auction-purchaser as well. We agree with the learned Judge that a judgment-debtor who is kept out of the knowledge of the execution sale by fraud, can, in an application under Order 21, Rule 90, Civil Procedure Code, to set aside the sale, invoke the aid of Section 18 of the Limitation Act to extend the period of limitation, where fraud is proved to have been committed by the decree-holder or the auction-purchaser or both. As we stated already it will be in very rare cases that the auction-purchaser will find it possible to commit fraud in conducting or publishing a sale and the question, therefore, has to be viewed from the point of view of the parties to the application. It is no doubt true that fraud as contemplated under Section 18 of the Limitation Act must be a fraud of the person against whom the suit or application is made, and if in our opinion both the auction-purchaser and the decree-holder are necessary parties to the application for setting aside the sale, then the application is directed against both and that being the case, the fraud of one or the other would be sufficient to have the sale set aside. It is impossible to have the sale confirmed as against one party and declared invalid as against the other. The decision of Panchapagesa Sastri, J., in Gulam Kadir v. Municipal Council, Nagapattinam (1950) 1 M.L.J. 432, in our opinion, does not take note of the necessity of the auction-purchaser being a necessary party. We agree with the opinion expressed by Mukherjea, J., as he then was, in Mahipathi Haldar v. Atul Krishna A.I.R. 1949 Cal. 212, where the learned Judge held that for setting aside a sale under Order 21, Rule 90, Civil Procedure Code, on the ground that there was fraud in publishing or conducting the sale it is not necessary to prove that the auction-purchaser was also guilty of fraud. Where fraud had been committed by the decree-holder in bringing the property of the judgment-debtor to sale, it would be sufficient to invalidate the sale even though the auction-purchaser was not aware of that. No doubt this decision has not found acceptance at the hands of benches of the same Court in the decision in Mihirlal v. Panchakari Santra : AIR1950Cal520 and Maji Bar Rahman v. Rahu Bux : AIR1954Cal604 . But in both those cases the question whether the auction-purchaser is a necessary party has not been considered. In our view the correct approach to the question is who are the necessary parties to the application and if any one of them is guilty of fraud, Section 18 of the Limitation Act can be invoked. That the fraud of the auction-purchaser invalidates the sale is also evident from a number of cases, notably, Pulla Reddi v. Pattabirami Reddi : AIR1933Mad626 and Pasumarthi Payidanna v. Ganti Lakshmi Narasamma (1914) 28 M.L.J. 525 : I.L.R. 38 Mad. 1076. We are inclined to agree with the view taken by Krishnaswami Nayudu, J., in Podila Venkanna v. Chinchindara Venkanna (1950) 1 M.L.J. 471. This Civil Miscellaneous Second Appeal is, therefore, dismissed with costs.


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