Equivalent Citation: AIR1994SC1583,
SUPREME COURT OF INDIA
Civil Appeal No. 4872 of 1993 Date : 08.09.1993
Appellants:Satyanarain Bajoria and another Vs. Respondent:Ramnarain Tibrewal and another
Para 13 on wards
13. The lower appellate court took the view that perusal of the order sheets dated 26th March, 1971, 20th July, 1971 and 19th August, 1971 of execution case No. 19/55 of 1968 shows that notices under Order 21 Rule 22 were issued and served on the judgment-debtor. To say the least it was erroneous on the part of the lower appellate court to refer to the order sheets for showing service of notice on the judgment debtor as required under Order 21 Rule 22 of the Code. The proceedings for setting aside the sale under Order 21 Rule 90 of the Code were independent proceedings and the file of proceedings under Order 21 Rule 22 of the Code could not be referred to in such proceedings without actual proof of service as per the various reports of alleged service contained in proceedings under Order 21 Rule 22 of the Code. Without proof of service of notice in these proceedings, the lower appellate court could not have gone merely by order sheets of the execution file. No process-server was examined to prove service of notice under Order 21 Rule 22 of the Code. It will be noticed that the decree was passed as far back as 1964. The present application was filed in 1968 more than 2 years after dismissal of earlier execution application and, therefore, for further proceedings in pursuance of a fresh execution application, the court was duty bound to issue notice and serve notice of the execution application on the judgment-debtor as provided for in Order 21 Rule 22 of the Code which contemplates inter alia that if an application for execution is made more than two years after the date of the decree, the court executing the decree shall issue a notice to the person against whom execution is applied for requiring him to show causes, on a date to be fixed, why the decree should not be executed against him. The last order made in the earlier execution application was on 29th November, 1965 and the second execution application was filed more than two years thereafter i.e. in 1968. Therefore, issuing of notice under Order 21 Rule 22 was mandatory. The idea of issuing such a notices is too ascertain whether the averments as to the amount being claimed in the execution application are true or incorrect. Besides, even if the amount was due, the judgment-debtor could have paid it and he was deprived of this opportunity to clear off dues, if any, under the decree. It is only after the service of notice under Order 21 Rule 22 of the Code and failure of the judgment-debtor to pay the decretal amount, as claimed, that the decree-holder takes recourse to proceedings under Order 21 Rule 54 of the Code. Then Order 21 Rule 54 of the Code provides as under : 54. Attachment of immovable property - (1) Where the property is immovable, the attachment shall be made by an order prohibiting the judgment-debtor from transferring or changing the property in any way, and all persons from taking any benefit from such transfer of charge. (1-A) The shall also require the judgment-debtor to attend Court on a specified dated to take notice of the date to be fixed for settling the terms of the proclamation of sale. (2) The order shall be proclaimed at some place on or adjacent to such property by beat of drum or other customary mode, and a copy of the order shall be affixed on a conspicuous part of the property and then upon a conspicuous part of the court-house, and also, where the property is land paying revenue to the Government, in the office of the Collector of the district in which the land is situate and, where the property is land situate in a village, also in the office of the Gram Panchayat, if any, having jurisdiction over that village. 14. It will be noticed that Sub-rule (1) of Rule 54 of Order 21 of the Code contemplates and order of prohibition to be served on the judgment-debtor from transferring or charging the property in any way first if the property sought to be sold is immovable property. This is for the benefit of the decree-holder. Even at this stage if the judgment-debtor had notice of attachment, he could pay the balance decretal amount and thereafter attachment would either not be effected and if already effected would be vacated. Sub-rule (1-A) contemplates that this order shall require the judgment-debtor to attend court on a specified date, to take notice of the date to be fixed for settling the terms of the proclamation of sale provided under Rule 66 of Order 21 of the Code. There was no evidence that the judgment-debtor was personally served with such a notice. Though sale proclamation after settlement of terms of proclamation after settlement of terms of proclamation ex-parte was published in local newspaper "Dalit Mitra" but that have wrong case number and wrong name of the court. There was also no evidence that any notice was affixed on a conspicuous part of the Court house or that the provisions of Sub-rules (1-A) & (2) of Rule 54 of Order 21 of the Code were complied with. Rule 54 is again for safeguarding the right of the decree-holder as well as the judgment-debtor. By the notice the judgment-debtor is put on notice that his property is attached and would be sold unless he pays off to the decree-holder. The trial court observed that this notice is required to be affixed on a conspicuous part of the property. We do not mean that merely if it is not being affixed on the conspicuous part, the sale would to be set aside but we are only emphasising the requirement of it being affixed on the conspicuous part of the property and on court house. All these stage give an opportunity to the judgment-debtor to pay off dues, if any under the decree. The proclamation of sale in this case was thus settled without notice to the judgment-debtor. The judgment-debtor had the right to participate in the proceedings for settlement of terms of proclamation of sale and atleast to known the date of sale. This is necessary since Order 21 Rule 89 of the Code confers again a right on any person having interest in the property sold, file an application to set aside sale on making deposit as contemplated by Rule 89. Rule 89 of Order 21 of the CPC reads thus: 89. Application to set aside sale on deposit - (1) Where immovable property has been sold in execution of a decree, any person claiming an interest in the property sold at the time of the sale or at the time of making the application, or acting for or in the interest of such person, may apply to have the sale set aside on his depositing in Court,- (a) for payment to the purchaser, a sum equal to five per cent of the purchase-money, and (b) payment to the decree-holder, the amount specified in the proclamation of sale as that for the recovery of which the sale was ordered, less any amount which may, since the date of such proclamation of sale, have been received by the decree holder. (2) Where a person applies under Rule 90 to set aside the sale of his immovable property, he shall not, unless he withdraws his application, be entitled to make or prosecute an application under this rule. (3) Nothing in this rule shall relieve the judgment-debtor from any liability he may be under in respect of costs and interest not covered by the proclamation of sale 15. The lower appellate court after assuming that there was no proper service of notice under Order 21 Rule 54 of the CPC went on to the question of judgment-debtor's having not pleaded any substantial loss or injury. It will be noticed that it was a case of typical money lender who has evil-eye to grab the property of the judgment-debtor some how or the other. He allows the first application for execution to be dismissed; waits for practically three years to file another execution application claiming a sum of Rs. 350 only sees to it that judgment-debtor is kept ignorant of the proceedings in court; obtains permission to himself buy the property; gets the property sold for recovery of petty amount of Rs. 649.45 ps. and buys the property himself. This again is a typical illustration of fraudulent conduct of decree-holder. In such cases the court will even presume loss and substantial injury to the judgment debtor. In the present case there was evidence of value of the property and both the parties had led evidence in this behalf and it was too late for the lower appellate court to blame the executing court for recording evidence as to the valuation at that stage. The fraud permeates the whole proceedings. At no stage was the judgment-debtor made aware of the pending execution application till even the confirmation of sale and purchase of the property by the decree-holder himself. 16. It will be noticed that so far judgment-debtor was concerned, on calculation, he had practically deposited the entire decretal amount by 4th January, 1965 and there was some mistake in calculation for a petty amount of Rs. 350. No demand notice was even sent to the judgment-debtor to pay it either outside the court or through the court. The judgment-debtor was deliberately being kept in the dark. 17. Learned Counsel for the decree-holder submitted that these are questions of fact since the High Court dismissed the revision petition in limine this Court should not interfere with the questions of fact. If it was merely a case of questions of fact proved on record, learned Counsel for the decree-holder would have been right. It appears lower appellate court had no knowledge whatsoever of how even notice under Order 21 Rule 22 of the Code was required to be served or the evidence in relation thereto being led in proceedings for setting aside of the sale at the instance of the judgment-debtor. The lower appellate court could not read the order sheet or proceedings purporting to be under Order 21 Rule 22 of the Code while dealing with proceedings under Order 21 Rule 90 of the Code and hold that the notices have been served. Lower appellate court again was mixing up the service on judgment-debtor of notice under Order 21 Rule 54 of the Code and of proclamation of sale. The lower appellate court again was ignoring the importance of notice under Order 21 Rule 54 (1-A) and (2) to enable the judgment-debtor to have notice of proceedings for settlement of terms of proclamation under Order 21 rule of the Code. It is true that now it has been specifically clarified by the explanation to Rule 90 of Order 21 of the Code that "the mere absence of, or defect in, attachment of the property sold shall not, itself, be a ground for setting aside a sale under this rule". But if the judgment-debtor is kept totally ignorant of the execution proceedings rights from the date of execution application till sale, it cannot be merely called a mere irregularity in attachment and thus of no consequence. Proceedings under Order 21 Rule 66 of the Code for settlement of terms of proclamation of sale are very material for both the parties, much more for the judgment-debtor as it is well known that the decree-holder always tries to under value the property whereas the judgment-debtor tries to over-value the property. However, provisions are made in the Code in Sub-rule (2) of Rule 66 of Order 21 that the sale proclamation shall be drawn up after notice to both the decree-holder as well as the judgment-debtor and shall state the time and place of sale and other requirements mentioned therein. No notice was given under Order 21 Rule 54 (1-A) of the Code which was mandatory for the court. In any case no notice for settlement of terms of proclamation of sale was served on the judgment-debtor personally as contemplated by Sub-rule (2) of Rule 66 of Order 21 of the Code. 18. The facts of the case show that the lower appellate court totally messed the points which were required to be determined and merely by assuming that even if notice under Order 21 Rule 54 of the Code is not served, by virtue of explanation to Rule 90 of Order 21 of the Code it is not a material irregularity or illegality to auction sale. The lower appellate court totally misunderstood the importance and efficacy of notices being served in execution proceedings under Order 21 Rule 22; Order 21 Rule 54 (1- A), notice for settlement of terms of proclamation in the presence of the judgment-debtor which leg to the finding recorded by it and the finding on fact in the circumstances, is totally vitiated. 19. The whole conduct of the execution proceedings at the behest of the decree-holder shows that every effort was made by decree-holder to see that the judgment-debtor was kept totally ignorant of the execution proceedings right till the sale and its confirmation. 20. In view of the aforesaid illegalities we have no hesitation in assuming substantial injustice and loss to the judgment-debtor. 21. We thus allow the appeal, set aside the judgments of the lower appellate court dated 28th November, 1985 and the High Court dated 8th April, 1986 and restore the order of the executing court dated 19th July, 1984. The appellant would also be entitled to costs.
SUPREME COURT OF INDIA
Civil Appeal No. 4872 of 1993 Date : 08.09.1993
Appellants:Satyanarain Bajoria and another Vs. Respondent:Ramnarain Tibrewal and another
Para 13 on wards
13. The lower appellate court took the view that perusal of the order sheets dated 26th March, 1971, 20th July, 1971 and 19th August, 1971 of execution case No. 19/55 of 1968 shows that notices under Order 21 Rule 22 were issued and served on the judgment-debtor. To say the least it was erroneous on the part of the lower appellate court to refer to the order sheets for showing service of notice on the judgment debtor as required under Order 21 Rule 22 of the Code. The proceedings for setting aside the sale under Order 21 Rule 90 of the Code were independent proceedings and the file of proceedings under Order 21 Rule 22 of the Code could not be referred to in such proceedings without actual proof of service as per the various reports of alleged service contained in proceedings under Order 21 Rule 22 of the Code. Without proof of service of notice in these proceedings, the lower appellate court could not have gone merely by order sheets of the execution file. No process-server was examined to prove service of notice under Order 21 Rule 22 of the Code. It will be noticed that the decree was passed as far back as 1964. The present application was filed in 1968 more than 2 years after dismissal of earlier execution application and, therefore, for further proceedings in pursuance of a fresh execution application, the court was duty bound to issue notice and serve notice of the execution application on the judgment-debtor as provided for in Order 21 Rule 22 of the Code which contemplates inter alia that if an application for execution is made more than two years after the date of the decree, the court executing the decree shall issue a notice to the person against whom execution is applied for requiring him to show causes, on a date to be fixed, why the decree should not be executed against him. The last order made in the earlier execution application was on 29th November, 1965 and the second execution application was filed more than two years thereafter i.e. in 1968. Therefore, issuing of notice under Order 21 Rule 22 was mandatory. The idea of issuing such a notices is too ascertain whether the averments as to the amount being claimed in the execution application are true or incorrect. Besides, even if the amount was due, the judgment-debtor could have paid it and he was deprived of this opportunity to clear off dues, if any, under the decree. It is only after the service of notice under Order 21 Rule 22 of the Code and failure of the judgment-debtor to pay the decretal amount, as claimed, that the decree-holder takes recourse to proceedings under Order 21 Rule 54 of the Code. Then Order 21 Rule 54 of the Code provides as under : 54. Attachment of immovable property - (1) Where the property is immovable, the attachment shall be made by an order prohibiting the judgment-debtor from transferring or changing the property in any way, and all persons from taking any benefit from such transfer of charge. (1-A) The shall also require the judgment-debtor to attend Court on a specified dated to take notice of the date to be fixed for settling the terms of the proclamation of sale. (2) The order shall be proclaimed at some place on or adjacent to such property by beat of drum or other customary mode, and a copy of the order shall be affixed on a conspicuous part of the property and then upon a conspicuous part of the court-house, and also, where the property is land paying revenue to the Government, in the office of the Collector of the district in which the land is situate and, where the property is land situate in a village, also in the office of the Gram Panchayat, if any, having jurisdiction over that village. 14. It will be noticed that Sub-rule (1) of Rule 54 of Order 21 of the Code contemplates and order of prohibition to be served on the judgment-debtor from transferring or charging the property in any way first if the property sought to be sold is immovable property. This is for the benefit of the decree-holder. Even at this stage if the judgment-debtor had notice of attachment, he could pay the balance decretal amount and thereafter attachment would either not be effected and if already effected would be vacated. Sub-rule (1-A) contemplates that this order shall require the judgment-debtor to attend court on a specified date, to take notice of the date to be fixed for settling the terms of the proclamation of sale provided under Rule 66 of Order 21 of the Code. There was no evidence that the judgment-debtor was personally served with such a notice. Though sale proclamation after settlement of terms of proclamation after settlement of terms of proclamation ex-parte was published in local newspaper "Dalit Mitra" but that have wrong case number and wrong name of the court. There was also no evidence that any notice was affixed on a conspicuous part of the Court house or that the provisions of Sub-rules (1-A) & (2) of Rule 54 of Order 21 of the Code were complied with. Rule 54 is again for safeguarding the right of the decree-holder as well as the judgment-debtor. By the notice the judgment-debtor is put on notice that his property is attached and would be sold unless he pays off to the decree-holder. The trial court observed that this notice is required to be affixed on a conspicuous part of the property. We do not mean that merely if it is not being affixed on the conspicuous part, the sale would to be set aside but we are only emphasising the requirement of it being affixed on the conspicuous part of the property and on court house. All these stage give an opportunity to the judgment-debtor to pay off dues, if any under the decree. The proclamation of sale in this case was thus settled without notice to the judgment-debtor. The judgment-debtor had the right to participate in the proceedings for settlement of terms of proclamation of sale and atleast to known the date of sale. This is necessary since Order 21 Rule 89 of the Code confers again a right on any person having interest in the property sold, file an application to set aside sale on making deposit as contemplated by Rule 89. Rule 89 of Order 21 of the CPC reads thus: 89. Application to set aside sale on deposit - (1) Where immovable property has been sold in execution of a decree, any person claiming an interest in the property sold at the time of the sale or at the time of making the application, or acting for or in the interest of such person, may apply to have the sale set aside on his depositing in Court,- (a) for payment to the purchaser, a sum equal to five per cent of the purchase-money, and (b) payment to the decree-holder, the amount specified in the proclamation of sale as that for the recovery of which the sale was ordered, less any amount which may, since the date of such proclamation of sale, have been received by the decree holder. (2) Where a person applies under Rule 90 to set aside the sale of his immovable property, he shall not, unless he withdraws his application, be entitled to make or prosecute an application under this rule. (3) Nothing in this rule shall relieve the judgment-debtor from any liability he may be under in respect of costs and interest not covered by the proclamation of sale 15. The lower appellate court after assuming that there was no proper service of notice under Order 21 Rule 54 of the CPC went on to the question of judgment-debtor's having not pleaded any substantial loss or injury. It will be noticed that it was a case of typical money lender who has evil-eye to grab the property of the judgment-debtor some how or the other. He allows the first application for execution to be dismissed; waits for practically three years to file another execution application claiming a sum of Rs. 350 only sees to it that judgment-debtor is kept ignorant of the proceedings in court; obtains permission to himself buy the property; gets the property sold for recovery of petty amount of Rs. 649.45 ps. and buys the property himself. This again is a typical illustration of fraudulent conduct of decree-holder. In such cases the court will even presume loss and substantial injury to the judgment debtor. In the present case there was evidence of value of the property and both the parties had led evidence in this behalf and it was too late for the lower appellate court to blame the executing court for recording evidence as to the valuation at that stage. The fraud permeates the whole proceedings. At no stage was the judgment-debtor made aware of the pending execution application till even the confirmation of sale and purchase of the property by the decree-holder himself. 16. It will be noticed that so far judgment-debtor was concerned, on calculation, he had practically deposited the entire decretal amount by 4th January, 1965 and there was some mistake in calculation for a petty amount of Rs. 350. No demand notice was even sent to the judgment-debtor to pay it either outside the court or through the court. The judgment-debtor was deliberately being kept in the dark. 17. Learned Counsel for the decree-holder submitted that these are questions of fact since the High Court dismissed the revision petition in limine this Court should not interfere with the questions of fact. If it was merely a case of questions of fact proved on record, learned Counsel for the decree-holder would have been right. It appears lower appellate court had no knowledge whatsoever of how even notice under Order 21 Rule 22 of the Code was required to be served or the evidence in relation thereto being led in proceedings for setting aside of the sale at the instance of the judgment-debtor. The lower appellate court could not read the order sheet or proceedings purporting to be under Order 21 Rule 22 of the Code while dealing with proceedings under Order 21 Rule 90 of the Code and hold that the notices have been served. Lower appellate court again was mixing up the service on judgment-debtor of notice under Order 21 Rule 54 of the Code and of proclamation of sale. The lower appellate court again was ignoring the importance of notice under Order 21 Rule 54 (1-A) and (2) to enable the judgment-debtor to have notice of proceedings for settlement of terms of proclamation under Order 21 rule of the Code. It is true that now it has been specifically clarified by the explanation to Rule 90 of Order 21 of the Code that "the mere absence of, or defect in, attachment of the property sold shall not, itself, be a ground for setting aside a sale under this rule". But if the judgment-debtor is kept totally ignorant of the execution proceedings rights from the date of execution application till sale, it cannot be merely called a mere irregularity in attachment and thus of no consequence. Proceedings under Order 21 Rule 66 of the Code for settlement of terms of proclamation of sale are very material for both the parties, much more for the judgment-debtor as it is well known that the decree-holder always tries to under value the property whereas the judgment-debtor tries to over-value the property. However, provisions are made in the Code in Sub-rule (2) of Rule 66 of Order 21 that the sale proclamation shall be drawn up after notice to both the decree-holder as well as the judgment-debtor and shall state the time and place of sale and other requirements mentioned therein. No notice was given under Order 21 Rule 54 (1-A) of the Code which was mandatory for the court. In any case no notice for settlement of terms of proclamation of sale was served on the judgment-debtor personally as contemplated by Sub-rule (2) of Rule 66 of Order 21 of the Code. 18. The facts of the case show that the lower appellate court totally messed the points which were required to be determined and merely by assuming that even if notice under Order 21 Rule 54 of the Code is not served, by virtue of explanation to Rule 90 of Order 21 of the Code it is not a material irregularity or illegality to auction sale. The lower appellate court totally misunderstood the importance and efficacy of notices being served in execution proceedings under Order 21 Rule 22; Order 21 Rule 54 (1- A), notice for settlement of terms of proclamation in the presence of the judgment-debtor which leg to the finding recorded by it and the finding on fact in the circumstances, is totally vitiated. 19. The whole conduct of the execution proceedings at the behest of the decree-holder shows that every effort was made by decree-holder to see that the judgment-debtor was kept totally ignorant of the execution proceedings right till the sale and its confirmation. 20. In view of the aforesaid illegalities we have no hesitation in assuming substantial injustice and loss to the judgment-debtor. 21. We thus allow the appeal, set aside the judgments of the lower appellate court dated 28th November, 1985 and the High Court dated 8th April, 1986 and restore the order of the executing court dated 19th July, 1984. The appellant would also be entitled to costs.
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