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S.K. Sundaram Vs. M. Jothi Rajamannar Chettiar and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai High Court
Decided On
Reported in(1972)2MLJ433
AppellantS.K. Sundaram
RespondentM. Jothi Rajamannar Chettiar and ors.
Cases ReferredSailappan v. Subbiah Pillai
Excerpt:
- .....attachment before judgment is a person whose interests are affected within the meaning of order 21 rule no civil procedure code. in official receiver of ramnad v. veerappa chettiar i.l.r. (1943) mad. 577 : (1943) 1 m.l.j. 449 another bench of this court distinguished the above decision in a case where an interim receiver was appointed in proceedings in insolvency. the argument put forward was that he represented the general body of creditors whose chances of obtaining dividends would be diminished if an inadequate price was fetched at the execution sale. it was held that it could not be said that their interests were affected by the sale.3. this decision was overruled by a full bench of this court in sailappan v. subbiah pillai : (1962)2mlj493 , on the ground that when an interim.....
Judgment:
ORDER

K.S. Venkataraman, J.

1. This revision petition has been filed by one of the alleged creditors of the judgment-debtors in O.S. No. 69 of 1969 on the file of the Court of the Subordinate Judge of Tiruchirapalli, but he was not a party to that suit. In execution of the decree certain properties of the judgment-debtors were sold on 17th March, 1971-The petitioner herein filed an application under Order 21, Rule 90 of the Civil Procedure Code, to set aside the sale on the ground of material irregularity and fraud, contending that the price letched was low. The learned Subordinate Judge, following the decision in Official Receiver of Ramnad v. Veerappa Chettiar (1943) 1 M.L.J. 449 : I.L.R. (1943) Mad. 577 : A.I.R. 1943 Mad. 199 held that the petitioner could not be said to be a person whose interests were affected by the sale within the meaning of Order 21, Rule 90, Civil Procedure Code, and therefore had no locus standi to maintain the application. This petition has been filed against that order.

2. Order 21, Rule 90, Civil Procedure Code, describes the persons who may apply to the Court to set aside the sale as the decree-holder or any person entitled to share in a rateable distribution of assets or whose interests are affected by the sale. Clearly some limitation must' be placed on the words 'whose interests are affected by the sale'. It will be noted that even a person who has obtained a decree against the judgment-debtors, cannot come within the second phrase 'any person entitled to share in a rateable distribution of assets', unless he has filed an execution petition. When even the right of the person who has obtained a decree is hedged in by such a restriction, it stands to reason that a mere creditor like the petitioner herein, who has not even obtained a decree and who has not filed any execution petition, cannot claim, to be a person whose interests are affected by the sale. A Full Bench of this Court in Ayyappa Naicker v. Kasipemmal Nayakar : AIR1939Mad250 , has held that a person who has obtained an attachment before judgment is a person whose interests are affected within the meaning of Order 21 rule no Civil Procedure Code. In Official Receiver of Ramnad v. Veerappa Chettiar I.L.R. (1943) Mad. 577 : (1943) 1 M.L.J. 449 another Bench of this Court distinguished the above decision in a case where an interim receiver was appointed in proceedings in insolvency. The argument put forward was that he represented the general body of creditors whose chances of obtaining dividends would be diminished if an inadequate price was fetched at the execution sale. It was held that it could not be said that their interests were affected by the sale.

3. This decision Was overruled by a Full Bench of this Court in Sailappan v. Subbiah Pillai : (1962)2MLJ493 , on the ground that when an interim receiver Was appointed, the property was in the custody of the Court and it would be open to the Court to preserve the property for the litigants before it and to give directions to the interim receiver to file an application under Order 21, Rule 90, Civil Procedure Code and hence in a case where the terms of the appointment of an interim receiver enabled him to file an application, he would have locus standi to file the application It may be noted that this very decision still approved the reasoning in Official Receiver of Ramnad v. Veerappa Chettiar (1943) 1 M.L.J. 449 : I.L.R. (1943) Mad. 577, that the general body of creditors as such could not claim that their interests would be affected by the sale. The learned Judges of the Full Bench pointed out that that was the only reason put forward before the Court in Official Receiver of Ramnad v. Veerappa Chettiar (1943) 1 M.L.J. 449 : I.L.R. (1943) Mad. 577. and that the reason relied on by them (Full Bench) was not put forward in the earlier case, namely, that the Court could take steps to preserve the property. The learned Judges of the Full Bench in Sailappan V. Subbiah Pillai : (1962)2MLJ493 , also affirmed the reasoning of Rajamannar, C.J. and Ganapatia Pillai, J., in Murugappa Chettiar v. Kannammai Achi I.L.R. (1959) Mad. 145 : (1958) 2 M.L.J. 461. It was held there that a creditor, who had obtained a decree against the judgment-debtor but had not yet filed an execution petition, could not file an application under Order 21, Rule 90, Civil Procedure Code. The learned Judges observed:

The words are indeed very wide and on a literal construction of the words', not only decree-holders but even ordinary creditors, who have not yet sought to enforce their claims, can be said to be affected by the sale of any of the properties of their debtor. Indeed, any one who has a prospective claim which can be satisfied by a sale of the properties of a person against whom he has the claim can be said to be a person whose interests are affected, by the sale of such property. We have no hesitation in holding that this wide construction was not contemplated by the words. The interests which are alleged to, be affected by the sale should be interests which are directly likely to be affected and not interests which may hypothetically and remotely be affected by the sale.

The wider interpretation was sought to be given by the Patna High Court. Differing from that interpretation, the learned Judges observed:

That interpretation of the expression 'whose interests are affected by the sale' would let in several classes of persons who, we are convinced, were never intended to be given the right to apply under Order 21, Rule 90 of the Code of Civil Procedure and would obstruct the course of execution.

This reasoning was affirmed by the Full Bench in Sailappan v. Subbiah Pillai : (1962)2MLJ493 , and applies to this case. No interim receiver has been appointed in the insolvency proceedings relating to the judgment-debtor in this case and therefore the petitioner cannot invoke Sailappan v. Subbiah Pillai : (1962)2MLJ493 , in his favour.

4. The view taken by the learned Subordinate Judge is correct. This civil revision petition is therefore dismissed.


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