IN No. 122 OF 1922
1. The plaintiffs, who are the respondents in this appeal, in the suit but of which the appeal arises claimed a declaration that a sale by auction pursuant to a certificate granted under the Public Demands Recovery Act, III (B.C.) of 1913 was void as being obtained by fraud and also on the ground of certain irregularities in relation to the execution proceedings. The suit was decreed and the 4th and 5th, defendants prefer this appeal and contend that the suit was incompetent and was not maintainable having regard to the provisions of Section 37 of the Public Demands Recovery Act. At the auction sale, the property in question was purchased by the 2nd defendant who subsequently assigned his interest therein for value to the 4th and 5th defendants.
2. Now, certain irregularities which were material and, therefore, would have justified an application to the certificate officer to set aside the sale were canvassed before us, the two main irregularities being that no notice was served upon the certificate-debtors as provided by Section 7 of the Act and that no sale-proclamation was published. Originally, an application was made on be behalf of the plaintiffs inter alia to set aside the sale under Section 23 and the appellants contend that the suit was incompetent by reason of the provisions of Section 36(b) of the Act which provides that 'Notwithstanding anything hereinbefore contained, a sale of immoveable property in execution of a certificate shall not be held to be void on the ground that the notice required by Section 7 has not been served; but a suit may be brought in a Civil Court to recover possession of such property or to set aside such sale on the ground that such notice has not been served and that the plaintiff has sustained substantial injury by reason of the irregularity: provided that no such suit shall be entertained, if the certificate-debtor has made appearance in the certificate proceeding, or has applied to the certificate-officer under Section 22 or Section 23 to set aside the sale.' The answer of the respondents is that their compliant was not merely that the notice required by Section 7 had not been served but that there were other material irregularities in the execution proceedings and that, therefore, Section 36 would not render their suit incompetent. The appellants further contend that the irregularities complained of were irregularities which involved the decision of questions-between the certificate-holder and the certificate-debtors or their representatives relating to the confirmation or setting aside by an order of the Court under the Public Demands Recovery Act of a sale held in execution in such certificate and that, pursuant to Section 37 of the Act, the suit was not maintainable because that section provides that 'any such question shall be determined not by suit but by order of the certificate officer before whom such question arises or of such other certificate officer as he may determine.' Now, it is, in my opinion, clear that the questions which arose with respect to the irregular process of execution were questions which arose between the certificate-debtor, that, is the Secretary of State, and the certificate-debtors, because, if the questions in issue were determined in a manner favourable to the certificate-debtors (who are the respondents in this appeal), the effect would be that the execution levied pursuant to the certificate on behalf of the Secretary of State would be rendered nugatory. It is settled law that, where a question arises between the certificate-holder and the certificate-debtors or their representatives, the procedure laid down by Section 37 must be adopted notwithstanding that the purchasers under the auction-sale may be impleaded as being interested parties in the suit. See Prosuno Kumar Sanyal v. Kali Das Sanyal 19 C. 683 : 19 I.A. 166 : 6 Sar. P.C.J. 209 : 9 Ind. Dec. (N.S.) 898 (P.C.). But that case is an authority for another proposition, namely, that it was the policy of the Legislature in enacting the Public Demands Recovery Act to provide that such questions as would arise in the course of execution proceedings should be settled in the manner provided by Section 37. Lord Macnaghten in delivering the judgment of the Board in the case to which I have referred observed as follows: 'It is of the utmost importance that all objections to execution sales should be disposed of as cheaply and as speedily as possible. Their Lordships are glad to find that the Courts in India have not placed any narrow construction on the language of Section 244, and that, when a question has arisen as to the execution, discharge, Or satisfaction of a decree between this parties to the suit in which the decree was passed, the fact that the purchaser, who is no party to the suit is interested in there suit has never been held a bar to the application of the section.' In my opinion, those observations are apposite in a consideration of the provisions of Section 37 of the Public Demands Recovery Act: and, in relation to any question which comes within the ambit of that section, recourse must be had to the procedure therein specified. I, therefore, think that if the present suit was a suit based merely on the irregularities in the execution proceedings to which our attention has been adverted, it was not maintainable. A fortiori it was not maintainable when, in point of fact, an application in that behalf had been made to the certificate-officer pursuant to the Act and in this suit it was sought to canvass anew the same question.
3. The respondents, however, take one further point in opposition to the objection raised by the appellants to the maintainability of the suit. The learned Advocate oh behalf Of the plaintiffs has strenuously urged that Section 37 in any event has no application, because in the suit it was sought to set aside the sale and to recover possession of the premises, the subject-matter thereof, on the ground that the execution proceedings were brought about by the fraud of the defendant: and he argues that the terms of the first paragraph of that section are to take effect subject to the proviso that 'a suit may be brought in a Civil Court in respect of any such question upon the ground of fraud.' Now, it is abundantly clear from a perusal of the record in this case that the main contest in the Trial Court ranged on the question as to whether the sale had been brought about through the fraud of the defendants. Evidence was led for the purpose of proving that the plaintiffs' gomastha Najimuddin, the auction-purchaser, (the defendant No. 2) and Krishna Behari Ray, a co-sharer with the plaintiffs in the property in question, had combined to defraud the plaintiffs of a valuable property by so acting in the matter of the execution proceedings that the sale should take place without the plaintiffs having knowledge of, or, being privy to, such proceedings. My learned brother and I invited the Advocate for the respondents to draw our attention to the evidence in support of this charge of fraud: but the evidence to which he referred us, in my opinion, was wholly inadequate to found a charge of fraud. With respect to the allegation of fraud, the learned Trial Judge has arrived at a clear finding adverse to the plaintiffs. So far am I from disturbing that finding that I find myself, after a perusal of the evidence, in full accord with it. The matter, therefore, stands thus: The plaintiffs, after taking steps to have the sale set aside by making application to the certificate-officer pursuant to the provisions of the Act, seek in this suit to re-open the same questions and, in addition, have added a claim to the same relief upon an allegation of fraud which proves to be groundless. If it were open to a certificate-debtor to adopt such a procedure, the provisions of Sections 36 and 37 would to a large extent become nugatory; for, a certificate-debtor, if minded to evade the provisions of the 37th section, could always bring a suit by making a fictitious allegation of fraud in respect of matters which under the section and in the absence of fraud, must be determined by means of the procedure therein specified. In my opinion, in the circumstances obtaining in this case, the allegation of fraud having been negatived, there is no other alternative but to hold1 under the terms of the Act that the plaintiffs should fail in their suit unless they satisfy the Court that they are entitled to a decree based upon some ground other than those to which Section 37 is made applicable. To my mind, the plaintiff's have wholly failed to make out their claim oil. any such ground, and this suit must be held to be not maintainable. The decree passed therein must, therefore, be set aside and the suit dismissed with costs both here and below. The transferee defendants Nos. 4 and 5 and the Secretary of State for India, are entitled to separate sets of costs in both the. Courts.
4. I agree.
IN NO. 123 OF 1922.
5. The judgment that has just been delivered in Appeal No. 122 will apply equally to this case also. This appeal is also decreed and the plaintiffs' suit dismissed with separate sets of costs to the transferee defendants Nos. 4 and 5 and the Secretary of State for India in Council.