Nandkishor Daulatrao Shelke vs Baban Vitthal Mhaske And Anr.
2004 Latest Caselaw 1044 Bom

JUDGMENT

Dharmadhikari B.P., J.

1. In this Civil Revision Application filed under Section 115 of Civil Procedure Code, the Revision applicant has challenged the order dated 14-3-1996 passed below Ex. 1. In M.J.C. No. 93 of 1994 and has further prayed for declaration that sale of property involved in the said M.J.C. be declared as void.

2. The facts of the case stated in brief are that the present Revision applicant is the owner of field Gat No. 99, Area 3 Hectares 47 R, for Rs. 32.38. The present respondent No. 2 Shakuntalabai had obtained a decree for recovery of Rs. 7,000/- against Revision applicant on 24-6-1991 and for execution thereof she filed Regular Darkhast/Execution Case No. 101 of 1991. In that, she made prayer for attachment of property. The property came to be attached by warrant of attachment dated 20-12-1991 and the further process of sale of that field property was undertaken. The sale price of this property was fixed at Rs. 50,000/- on 4-1-1992. The sale was held by bailiff of civil Court on 30-12-1993 and bid of non-applicant No. 1 - Baban was accepted at Rs. 40,000/ - being the highest value. It is pointed out that auction purchaser- Baban deposited 1/4th amount of Rs. 10,000/- on 1-1-1994 and thereafter he deposited the balance 3/4th amount i.e. Rs. 30,000/- on 31-1-1994, On 19-3-1994, the auction purchaser filed M.J.C. No. 23 of 1994 for possession before the Joint Civil Judge, Junior division, Buldhana, and the said Court by its order 14-3-1996 issued the warrant of possession under the provisions of Order 21, Rule 95 of the Civil Procedure Code. On this M.J.C for possession, filed by the auction purchaser- Baban, the present revision applicant- Judgment debtor given the say that the application for possession was not tenable and further that he has filed Insolvency Petition No. 2 of 1993 and hence property cannot be proceeded against further. The Joint Civil Judge, Junior Division, Buldhana, after hearing the parties concerned, passed the impugned order on 14-3-1996 and allowed the auction purchaser to proceed to take possession and further ordered issuance of warrant for possession. It is this order which is challenged in present civil revision application by the revision applicant.

3. I have heard Advocate Shri Khapre, for the revision applicant and Advocate Shri Patil, for the non-applicants.

4. Advocate Shri Khapre, contended that the impugned order passed by the Court below shows total non-application of mind insofar as the requirement of the provisions of Order 21, Rules 84 and 85 of the Civil Procedure Code are concerned. He points out that the lower Court found that the auction was held on 30-12-1993, the amount of Rs. 10,000/- was deposited on 1-1-1994 and thereafter the remaining amount of Rs. 30,000/- representing the balance 3/4th portion was not deposited within 15 days but it has been deposited on 31-1-1994. He points out the trial Court, observed that sale was confirmed and certificate of sale of land under Order 21 Rule 94 was issued to respondent No. 1 auction purchaser and therefore, he is entitled to take possession of said land from judgment Debtor. Insofar as ground of insolvency proceeding filed by the judgment Debtor dealt with by lower Court is concerned, the learned Advocate has not touched that aspect.

5. The learned Advocate points out that as per provisions of Order 21, Rule 84 of Civil Procedure Code, the auction purchaser has not deposited the 1/4th amount immediately and further the 3/4th amount has also not been deposited within 15 days. He contends that there is no jurisdiction in the Court to extend time for that purpose. He contends that once there is failure to deposit the amount as required by these provisions, the sale is void and the lower Court was obliged to hold fresh sale. In support of his contentions, he has relied upon the judgments in the case of Nani Gopal Paul v. T. Prasad Singh, ; Balram v. Ram Singh, reported in 1997(Supp.) Bom.C.R. (S.C.)365 : 1997(1) Mh.L.J. 687; Mohan Lal v. Hari Prasad Yadav, , Indium India Telecom Ltd. v. Motorola Inc. and Ors., and in the case of Sardara Singh (Dead) by LRs. and Anr. v. Sardara Singh (Dead) and Ors., . He contends that these judgments support his argument that such sale is void and there is no question of revision applicant moving an application to have it set aside.

6. As against this, Advocate Shri Patil, appearing for the non-applicants contended that the revision applicant never moved any application for getting the sale set aside as required under Order 21, Rule 90 and such process must precede the confirmation of sale. He contends that there is a period of limitation of 60 days for that purpose. He contended that once the sale is confirmed, there cannot be any application or action for getting the said sale set aside. He contends that the view taken by the trial Court that once the sale is confirmed, auction purchaser is entitled to property, therefore, is correct and cannot be interfered. In support of his contention, he relied upon the judgment in the case of Mangilal Narsingdas v. Shaligram, .

7. The relevant provisions of Order 21 which deals with this aspect, reads as under:

Order 21, Rule 84 - Deposit; by purchaser and re-sale on default. - (1) On every sale of immovable property the person declared to be the purchaser shall pay immediately after such declaration a deposit of twenty-five per cent on the amount of his purchase money to the officer or other person conducting the sale, and in default of such deposit, the property shall forthwith be re-sold.

(2) Where the decree-holder is the purchaser and is entitled to set off the purchase-money under Rule 72, the Court may dispense with the requirements of this Rule."

Rule 85 as amended by Bombay High Court

85 Time for payment in full of purchase money. - The full amount of purchase money payable, together with the amount required for the general stamp paper for the certificate under Rule 94, shall be paid by the purchaser into Court before the Court closes on the 15th day from the date of the sale of the property.

Provided that, in respect of the purchase-money, the purchase shall have the advantage of any set-off to which he may be entitled under Rule 72.

Provided further that, if as a result of some bona fide mistake or miscalculation the amount deposited falls short of the full amount of the purchase-money, the Court may in its discretion, allow the shortfall to be made up after fifteen days of the sale, and if the full amount of the purchase-money is deposited within such time as the Court may allow, the Court may condone the delay, if it considers it just and proper to do so.

Explanation. - When an amount is tendered in Court on any day after 1.00 P.M. But is not accepted by the Court and is paid into Court on the next working day between 11.00 A.M. And 1.00 P.M., the payment shall be deemed to have been made on the day on which he tender is made."

Order 21, Rule 86 - Procedure in default of payment.- In default of payment within the period mentioned in the last preceding Rule, the deposit may, if the Court thinks fit, after defraying the expenses of the sale, be forfeited to the Government, and the property shall be re-sold, and the defaulting purchaser shall forfeit all claim to the property or to any part of the sum for which it may subsequently be sold."

Order 21, Rule 90 - Application to set aside sale on ground of irregularity or fraud - (1) Where any immovable property has been sold in execution of a decree, the decree-holder, or the purchaser, or any other person entitled to share in a rateable distribution of assets, or whose interests are affected by the sale, may apply to the Court to set aside the sale on the ground of a material irregularity or fraud in publishing or conducting it.

(2) No sale shall be set aside on the ground of irregularity or fraud in publishing or conducting it unless, upon the facts proved, the Court is satisfied that the applicant has sustained substantial injury by reason of such irregularity or fraud.

(3) No application to set aside a sale under this Rule shall be entertained upon any ground which the applicant could have taken on or before the date on which the proclamation of sale was drawn up.

Explanation. - The mere absence of, or defect in, attachment of the property sold shall not, by itself, be a ground for setting aside a sale under this Rule."

8. Thus perusal of provisions of Rule 84 Sub-rule (1) show that respondent No. 1 has to pay 1/4th amount of his total purchase price immediately after the auction in his favour is over by tendering it to the officer or person conducting the same. Rule 85 mandates that the balance amount is to be paid by him in the Court before the Court closes on 15th day from the sale of property. Here, the auction was conducted on 30-12-1993 and therefore, Respondent No. 1 ought to have deposited the amount of Rs. 10,000/- with the bailiff conducting the auction on the same day. He has not deposited the amount on 30-12-1993 or even on 31-12-1993. It appears that he has deposited that amount on 1-1-1994. Similarly, he should have deposited the balance amount of Rs. 30,000/- within 15 days of the auction i.e. before the Court closed on 14th January, 1994 but he has deposited this amount of Rs. 30,000/- on 31st January, 1994. Rule 86 mandates that if the payment as required by Rules above is not made, the Court shall re-sale the property. In this case, the perusal of the impugned order shows that through the lower Court has considered all these dates, the Court has not applied its mind as required by the provisions of Order 21, Rules 84 to 86 in the matter.

9. Advocate Shri Patil, appearing for the non-applicants submits that after the auction was over on 30-12-1993, the amount of Rs. 10,000/- was not accepted on that date and the regular Court was available on 1-1-1994 and therefore, he deposited the said amount of Rs. 10,000/- on 1-1-1994. He further points out that the learned Court on 25-1-1994 directed him to deposit balance amount within five days. He further points out that on 31-1-1994, he moved a pursis before the said Court and sought permission to deposit remaining balance amount of Rs. 30,000/-. The learned Judge directed the Assistant Superintendent to accept Rs. 30,000/- as purchase money and accordingly he deposited balance amount of Rs. 30,000/- on 31-1-1994. He, therefore, contends that all these payments were accepted by the Court and therefore, the sale in his favour was confirmed. He contends that all this was never objected to by the present revision applicant. He relied upon the judgment reported in 2002(3) Mh.L. J. 857 [supra] for this proposition. He contends that if at all sale was vitiated on account of any material irregularity and fraud in publishing or conducting the sale, the judgment-debtor ought to have objected to the same and should have filed application under Order 21, Rule 90 for setting aside of the same. He contends that no such application was filed by him within 60 days as required by law and the sale was confirmed. Therefore, he is entitled to possession. Perusal of this judgment shows that the Court was considering the case of material irregularity and fraud or other situations contemplated by Order 21, Rule 90. The case whether the Court conducting the sale is obliged to hold fresh sale because of the fault on behalf of the auction purchaser to deposit the amount within time stipulated by Order 21, Rule 85 is not considered in this judgment at all. Therefore, this ruling has no application in the facts and circumstances of the present case.

10. As against this, Advocate Shri Khapre, relying upon the judgment reported in the case of Nani Gopal Paul v. T. Prasad Singh, points out that the Court can that suo motu notice of illegality in this matter and the sale ought to have been quashed and set aside and the possession cannot be delivered. He contends that confirmation of sale was itself illegal. Para 4 of this ruling reads as under which supports his contention:

4. We are of the view that we can take suo motu judicial notice of the illegality pointed out by the Division Bench, committed by the Single Judge of the High Court in bringing the properties to sale. Accordingly, we are of the view that the circumstances are sufficient to vitiate the validity of the. sale conducted by the Court Receiver as approved by the learned Single Judge. Confirmation of sale was illegal. Though, as contended by Sri Ganesh that normally an application under Order 21, Rule 89 or 90 or under Section 48 C.P.C. need to be filed within limitation to have the sale conducted by the Court set aside and that procedure need to be insisted upon, we would not remain a mute or helpless spectator to obvious and manifest illegality committed in conducting Court sales. We are informed and it is not disputed that the appellant had deposited only Rs. 5 lakhs and balance amount was assured to be deposited only after delivery of possession. That also would be illegal."

11. Advocate Shri Khapre, has further pointed out the ruling of Division Bench of Hon'ble Apex Court in the case of Balram v. Ram Singh reported in 1997(1) Mh.L.J. 687. Paras 5 and 7 of this ruling are important. These paras show that such a sale in violation of provisions of Order 21, Rule 85 is void and the purchase money must be deposited within 15 days. Advocate Shri Khapre points out that para 7 also deals with provisions of Order 21, Rule 90 and violation of Rule 85 has not been accepted as material irregularity by the Apex Court. The Apex Court has observed that such a sale is totally nullity and the executing Court is obliged to proceed under Rule 86. The argument that the executing Court has inherent power to extend time to make such deposit is also rejected by the Apex Court in para 7. These are reproduced below:

5. The main point for decision is whether there is non-compliance of Order 21, Rule 85 to render the auction-sale void. The above facts are undisputed. It is beyond controversy that the full amount of purchase money payable by the purchaser into the Court was not paid by him within 15 days from the date of the auction-sale. This result ensues even after giving the advantage of set-off of the decretal amount due to the purchaser decree-holder to which he may have been entitled under Rule 72. The only argument to avoid its consequences is that the shortfall in the deposit was occasioned by a mistake of the Court in the calculation of the amount, of which the appellant was entitled to claim set-off under Rule 72. The question is whether this plea is tenable to avert the inevitable consequences of the failure to comply with the strict requirement of Rule 85.

7. It is to be noted that the argument that it is only a material irregularity in the sale to attract Rule 90 instead of Rule 85 was expressly rejected; and it was clearly held that Rule 85 being mandatory, its non-compliance renders the sale proceedings a complete nullity requiring the executing Court of proceed under Rule 86 and property has to be resold unless the judgment-debtor satisfies the decree by making the payment before the resale. The argument that the executing Court has inherent power to extend time on the ground of its own mistake was also expressly rejected. In our opinion the contentions of the learned Counsel for the appellant are fully negatived by this decision of the Court."

12. Advocate for the revision applicant has thereafter relied upon the judgment reported in the case of Sardara Singh v. Sardara Singh, . The relevant observations in this respect at page 96 are as under :

It is clear from this decision that the requirement of deposit contained in Sections 85, 86 and 88 of the Act, which are substantially the same as Order XXI, Rules 84 and 85 of the Code, are mandatory and failure to comply with either of them renders the sale non est. Once the effect of non-payment of the amount is to render the sale non-existent, it becomes the imperative duty of the authority to re-sell the property as the purchaser forfeits all claim to the property for default of payment. Where there is no sale in the eyes of law, there can be no question of applying for setting aside the sale on the ground of material irregularity under Section 91 of the Act which is analogous to Order XXI, Rule 90 of the Code. Non-payment of the balance amount had the effect of rendering the entire sale null and void. There can be no doubt that no right, title or interest passed to the auction-purchasers under the sale certificate of March 12, 1966. In fact, technically speaking, in such cases, it may not be necessary to have the sale set aside as in the eye of law there is no sale whatsoever. The owner of the land was, however, required to file a suit as there was an imminent threat to dispossess him on the strength of the sale certificate of March 12, 1966. To protect his possession he was compelled to file the suit. Unfortunately, during the pendency of his appeal he was dispossessed and, therefore, he was required to amend the plaint and claim possession also. The suit was, therefore, clearly de hors the provisions of the Act and hence ordinarily the civil Court was entitled to hear and decide the same. But it was contended on behalf of the auction-purchasers that the jurisdiction of the civil Court was ousted by the specific provisions contained in Clauses (xiv) and (xv) of Sub-section (2) of Section 158 of the Act. In order to appreciate this contention we may refer to the said provision."

The relevant observations at page 97 are as under ;

In the present case the suit was instituted for a permanent injunction to restrain the defendants from taking possession of the land sold in public auction on the strength of the sale certificate issued on March 12, 1966. The validity of this document was challenged on the ground that the sale was void since the auction-purchasers had failed to deposit the balance of the sale price within the time allowed by Section 88 of the Act. As the sale was void, the subsequent acts of confirmation of the sale on February 21, 1966 and issuance of sale certificate on March 12, 1966 by the concerned authorities were of no avail to the auction-purchasers. The owner of the land, therefore, contended that the auction-purchasers were not entitled to possession under the sale certificate which was wrongly issued by the concerned authorities after the sale had become void in the eye of law. In order to protect his possession the land owner was, therefore, entitled to sue the auction-purchasers who were seeking to dispossess him on the strength of a document which had no efficacy in law. This is not a case of the land owner seeking to set aside the sale under Section 91 of the Act, since it was not necessary for him to apply for setting aside the sale as there him to apply for setting aside he sale as there existed no sale. It was, therefore, open to the land owner to approach the Civil Court to protect his possession as the same was threatened. Such a suit, therefore, does not attract the provisions of Section 158(2) on which reliance is placed. The High Court, therefore, rightly observed as under :

As his property had been sold by the revenue authorities without jurisdiction he had the right to file the suit in the civil Court and which had the jurisdiction to decide the matter. It is an established principle of law that if the act of the parties under any Act is without jurisdiction of the civil Court is not excluded."

We respectfully agree with the above observation. Once it is held that the sale was rendered null and void on the failure of the auction-purchasers to comply with the requirements of Section 88 of the Act, it was the imperative duty of the authorities to put the property to resale for the law did not confer any discretion in the concerned authorities to extend the time for the payment of the balance amount. Once the mandatory requirement of Section 88 of the Act was not complied with; the only course open to the concerned authorities was to put the property to re-sale. It, therefore, did not have any jurisdiction to accept the balance money after the expiry of the period prescribed by Section 88 of the Act."

13. He further points out the judgment in the case of Mohan Lal v. Hari Prasad Yadav, , to buttress the contention that Section 148 of the Civil Procedure Code, is not applicable and the argument of auction-purchaser that lower Court extended the time is, therefore, without any merit. He also points out that this view is also accepted by the Division Bench of this Court in the case of Iridium India Telecom Ltd. v. Motorola Inc. and Ors., reported in 2004(1) All.M.R. 418. The relevant observations contained in paras 4 and 5 are reproduced below :

4. The learned Solicitor General submitted and in our opinion rightly so, that the provisions of Order VIII, Rule 1 are in the nature of self contained Code in so far as filing of written statement is concerned. It prescribes the outer limit for filing the written statement and hence reliance upon the general power under Section 148 was not permissible. Moreover Section 148 empowers the Court to enlarge time, where any period is fixed or granted by the Court. The time for filing a written statement is not granted or fixed by a Court, but fixed by the Code and consequently Section 148 would have no application. It has been consistently held by almost all High courts that the Court has no power to extend a period fixed by statute and not fixed or granted by the Court. See Jagit v. Sankatha , Kalipada v. Basanta v. Veluswamy A.I.R. 1961 Mad. 711, Kathayee Cotton Mills v. V.R. Padmanabha Pillai . There is also an authoritive pronouncement by the Supreme Court in Mohanlal v. Hari Prasad Yadav , where a two Judge Bench observed :

"We are thus left with the question whether Section 148 of the Code would be applicable to the present case or not. Again Section 148 of the Code would not be applicable to the present case for the simple reason that the time of making an application under Rule 89 of Order 21 of the Code is not fixed by the Court."

5. In our opinion Section 148, which is repository of the general power to extend time cannot override the express limitation of Order VIII, Rule 1, which has been amended by the amending. Act and which has prescribed outer limit of 90 days beyond which written statement could not be entertained. Therefore, the learned Single Judge clearly erred in holding that the time to file a written statement could be extended beyond the outer limit of 90 days by resorting to Section 148. Having said this, it would now have to be seen whether the provisions of Order VIII, Rule 1 would apply to suits on the Original Side, or whether they would continue to be governed by Original Side Rules."

14. Thus, in view of the authoritative pronouncement mentioned above, it is clear that there was no scope for the learned Lower Court to extend the time in favour of respondent No. 1 to effect the deposit of balance amount and respondent No. 1 was duty bound to deposit the remaining amount of Rs. 30,000/- on or before close of Court on 14-1-1994. It is an admitted position on record that he has not done so. Therefore, the further provision as contained in Order 21, Rule 86 automatically operates and the Court below ought to have resold the property. The further steps taken by the lower Court in accepting the deposit of balance amount from auction purchaser on 31-1-1994 or in confirming the sale in his favour on 8-2-1994 or issuing sale certificate in his favour on 29-3-1994, are all acts without jurisdiction and therefore, void. The Court below, therefore, could not have allowed the MJC No. 23 of 1994 for delivery of possession in favour of auction purchaser i.e. respondent No. 1 because the sale in his favour is void and is of consequence. The Court below should have, therefore, dismissed his application under Order 21, Rule 95 for possession filed vide MJC No. 23 of 1994.

15. Ordering delivery of possession of auction property in favour of respondent No. 1 is hereby quashed and set aside. It is held that respondent No. 1- auction purchaser is not entitled to any sale certificate and confirming of sale in his favour is void. The trial Court is directed to proceed further in the matter in accordance with the provisions of Order, 21 Rule 86 of Civil Procedure Code.

16. Revision is accordingly allowed. Rule is made absolute in above terms.

17. There shall be no order as to costs.