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RamizaddIn Basar and ors. Vs. Naimaddi Basar and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata
Decided On
Reported inAIR1933Cal339
AppellantRamizaddIn Basar and ors.
RespondentNaimaddi Basar and ors.
Cases ReferredBhairab Chandra Sinha v. Kali Dhan Roy
Excerpt:
- .....themselves applied to set aside the sale and it transpires in the course of the evidence that the auction-purchaser opposite party did pay to the decree-holders a sum of about rs. 300 in order that the decree-holders might withdraw their application for setting aside the sale. the property has been sold for a grossly inadequate price of rs. 39, the value according to the munsif who dealt with the matter in the first instance being at least rs. 1,000 at the lowest calculation, and it appears from the evidence on behalf of the auction-purchaser opposite party that its value would be at least rs. 700. the munsif came to the conclusion that the sale was vitiated by the fraudulent suppression of the sale processes and that the sale being a fraudulent one the burden of proof lay on the.....
Judgment:

Mitter, J.

1. This Rule is directed against the appellate order of the District Judge of Dacca dated 20th March 1931 refusing to sot aside the sale of the petitioners' properties held on 19th April 1927. The petitioners applied under Order 21, Rule 90, Civil P.C., for setting aside the sale in question on 19th May 1930. The petitioners rested their application on several grounds: (1) that the sale processes were suppressed and there was irregularity in publishing and conducting the sale and; (2) owing to suppression of the sale processes the properties were sold at an inadequate price. They allege that they came to know of the sale on 5th Baisakh 1337 from Gani Munshi of their village. On the evidence it transpires that they took some time to verify this information obtained from Gani Munshi and they have applied within 30 days of the date of their knowledge which the Munsif found to be 7th Baisakh to set aside the sale. It is a somewhat significant circumstance in this case that the decree-holders who sold this property in execution of a rent decree themselves applied to set aside the sale and it transpires in the course of the evidence that the auction-purchaser opposite party did pay to the decree-holders a sum of about Rs. 300 in order that the decree-holders might withdraw their application for setting aside the sale. The property has been sold for a grossly inadequate price of Rs. 39, the value according to the Munsif who dealt with the matter in the first instance being at least Rs. 1,000 at the lowest calculation, and it appears from the evidence on behalf of the auction-purchaser opposite party that its value would be at least Rs. 700. The Munsif came to the conclusion that the sale was vitiated by the fraudulent suppression of the sale processes and that the sale being a fraudulent one the burden of proof lay on the opposite party to show that the petitioners had knowledge of the sale at a time beyond the period of limitation. This according to the Munsif the opposite party failed to prove. The Munsif came to the further conclusion that the property was sold at an excessively inadequate price and the petitioners were highly prejudiced by the sale of their valuable property for the very insignificant sum of Rs. 39. The sale was accordingly set aside.

2. An appeal was taken by the auction-purchaser to the Court of the District Judge and the learned Judge has disposed of the appeal on the ground of limitation after reaching the conclusion that there has not been fraudulent suppression of the sale proclamation by the decree-holders. The learned Judge however refers to the fact that the auction-purchaser settled the matter with the decree-holders by the payment of Rs. 300 to them. The decree-holders, as has already been stated, filed an application before the confirmation of the sale to the effect that they were no parties to the execution proceedings and that the execution proceedings were really conducted by one Tamijuddi who signed the petition for execution without their authority. The learned Judge is of opinion that in his judgment it cannot be inferred from this circumstance that the appellant had taken part in the fraud.

3. To my mind it seems that this is a very significant circumstance, and it is quite clear that the auction-purchaser was trying to secure this property anyhow-a property which she knew had been purchased for an extremely inadequate value. I do not agree with the learned District Judge when he says that this payment was made by a bona fide purchaser to buy off an objection. One does not see any sufficient reason why the auction-purchaser should pay the decree-holders the sum of Rs. 300 unless the auction-purchaser was apprehensive that the sale was one which was surrounded with circumstances of suspicion as to the fraudulent part taken by the decree-holders in bringing about the sale. In considering as to whether there has been fraud in this case or not the learned District Judge did not consider a very important circumstance which is apparent on the face of the record. In the sale proclamation which was issued under Section 163, Clause 2(b), Ben. Ten. Act of 1885, the value of the property was stated to be only Rs. 10, while on the auction-purchaser's own evidence the value of the property is 70 times the value of what is stated there. The discrepancy between the value as stated in the sale proclamation and the real value of the property even judged by the evidence of the auction-purchaser is so great that this circumstance must be regarded as something more than the kind of irregularity which is commonly alleged, for it is a misstatement of the value of the property which is so glaring in amount that it could hardly have been made in good faith and which, however it came to be made, was calculated to mislead possible bidders and to prevent them from offering adequate price or from bidding at all. This is of a class of cases where the statement of the inadequate value is so great, as has been said by a distinguished English Judge, as to shock the conscience. This itself, as I have pointed out in another case, namely Bhairab Chandra Sinha v. Kali Dhan Roy : AIR1929Cal736 , is valuable evidence of fraud, and no Court would be justified in circumstances like these to uphold a sale which offers clear evidence of fraud on the part of the decree-holders. If the learned Judge had considered this aspect of the case he would not have felt any difficulty in arriving at a decision on the question of limitation.

4. The learned District Judge is of opinion that the petitioners have not been able to establish that they came to know of the sale within 30 days of their application and he commented on the evidence that Gani Munshi had not been examined. But once fraud is established, as it is in the present case, the burden of proof is on the decree-holder or the auction-purchaser, as the case may be, of establishing that the person injured by his fraud and suing to recover property has had clear and definite knowledge of those facts which constitute fraud at a time which is too remote to allow him to make the application. This is sought to be attempted by the auction-purchaser by relying on the evidence of one of the petitioners to the effect that he came to know of the sale on the 4th Baisakh which was certainly beyond the period of limitation for making the application. But in that attempt in my opinion she has failed. All that the evidence points to is this: that some clues and hints about the happening of this sale reached one of the petitioners, who has deposed in the present case on the 4th Baisakh. He took time to verify the correctness of that vague report or information and he came to know of it as he states in his petition a few days after, the petitioner having stated the date,7th Baisakh, which was accepted by the Munsif to be the date of the knowledge of the petitioner. The vague report which he obtained was actually followed up and that led one of the petitioners to have complete knowledge of the fraud and he was informed of the circumstance in the sense of having definite knowledge of fraud about the 7th Baisakh which was within the period of limitation.

5. Under these circumstances I think that the judgment of the District Judge confirming the sale must be set aside. The sale is set aside and the Munsif's judgment is restored. It transpires that two of the several persons interested in the property have subsequent to the sale sold the property to the auction-purchaser. This decision will not affect any right which the auction-purchaser had acquired subsequent to the sale on this basis. There will be no order for costs in this Rule.


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