IN THE HIGH COURT OF KARNATAKA AT BENGALURU BEFORE THE HON BLE MR.JUSTICE ARAVIND KUMAR EXECUTION FIRST APPEAL NO.2/2012

Transcription

1 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 10 th DAY OF APRIL, 2015 BEFORE THE HON BLE MR.JUSTICE ARAVIND KUMAR EXECUTION FIRST APPEAL NO.2/2012 BETWEEN: SRI.K.L.KHURANA AGED ABOUT 70 YEARS R/AT NO.189, CANARA BANK COLONY NEAR NAGARABHAVI ROAD BENGALURU REP. BY GPA HOLDER MR. DHIRAJ KHURANA S/O K.L. KHURANA R/AT NO.189, CANARA BANK COLONY NEAR NAGARABHAVI ROAD BENGALURU APPELLANT (BY SRI.M.ASWATHANARAYANA REDDY, ADVOCATE) AND: 1. M/S SURESH BROTHERS NO.2, D.K. LANE BVK IYENGAR ROAD CROSS BENGALURU A REGISTERED FIRM REPRESENTED BY ITS PARTNER MRS. VEENA AGARWAL. 2. SURESH CHAND AGAWAL AGED ABOUT 75 YEARS S/O LEELDHAR HISSALA

2 2 NO.15-C, 1 ST FLOOR, IB MAIN, HSR LAYOUT SECTOR-6 BENGALURU-34. RESPONDENTS (BY SRI. CHANDAN RAO, FOR SRI K. SURYANARAYANA RAO, ADVOCATES FOR R-1; SRI. GANAPATHI HEGDE, ADVOCATE FOR R-2) THIS APPEAL IS FILED UNDER CHAPTER-VI (1)(b) OF HIGH COURT OF KARNATAKA RULES, 1959 AGAINST THE ORDER DATED PASSED IN EX.NO.220/1999 ON THE FILE OF THE V-ADDL. CITY CIVIL JUDGE, BENGALURU DISMISSING THE APPLICATION UNDER SECTION 47 R/W SECTION 151 OF CPC. THIS APPEAL BEING HEARD AND RESERVED, COMING ON FOR PRONOUNCEMENT OF ORDERS THIS DAY, THE COURT DELIVERED THE FOLLOWING: JUDGMENT Judgment Debtor being aggrieved by order dated passed in Execution No.220/1999 rejecting his application filed under Section 47 read with Section 151 of CPC has preferred this First Appeal under Chapter VI I(1)(b) of Karnataka High Court Rules, 1959.

3 3 2. Parties are referred to as per their rank before Executing Court. 3. Facts in brief which has led to filing of this appeal are as under: Decree holder filed a suit O.S.No.5422/1993 against the judgment debtor for recovery of Rs.1,70,000/- with 24% p.a. Though written statement was filed matter was not contested and suit came to be decreed on for a sum of Rs.3,17,242/- together with costs and 24% p.a. on 2,87, from the date of suit till realization. Judgment Debtor filed a Miscellaneous Petition in Misc.No.1115/2003 to set aside the said judgment and decree which came to be dismissed on Same has reached finality. 4. Decree holder in order to enjoy the fruits of the decree filed execution petition in E.P.No.220/1999 on

4 The immovable property belonging to the judgment debtor was brought for sale in the said execution proceedings. On sale proclamation being issued, spot sale and court sale came to be conducted and sale was confirmed in favour of the auction purchaser namely second respondent in this appeal and Sale certificate also came to be issued in his favour. 5. Judgment Debtor after 10 years from issuance of sale certificate in favour of the auction purchaser filed an application under Section 47 read with Section 151 of CPC to set aside the sale of the property described in the application morefully, contending interalia: (i) The auction proceedings conducted is contrary to the provisions of Code of Civil Procedure;

5 5 (ii) Auction Purchaser is none other than husband of the decree holder; (iii) Bank Manager from whom the Judgment Debtor had obtained credit facility is friend of auction purchaser and the decree holder and as such he has supplied the copies of the title deeds; (iv) Sale notice was not served on judgment debtor; (v) Judgment Debtor does not have saleable interest in the property sold and as such, auction sale is bad in law; (vi) Decree holder and auction purchaser have played fraud on the Court and the Judgment

6 6 Debtor in selling the property in question; (vii) Auction sale suffers from material irregularity and legal infirmity and same is in contravention of Rule 138 of the Karnataka Civil Rules of Practice; (viii) Executing Court has not considered whether property in question is having a legal title for being sold in public auction. (ix) Property has been sold for very low price by virtue of collusion between decree holder and auction purchaser; (x) Decree holder has not made attempts to secure fair price for the property;

7 7 (xi) Auction conducted is contrary to Order 21 Rule 66 CPC. Hence, judgment debtor sought for auction sale being set aside. 6. Decree holder as well as auction purchaser both have filed statement of objections to the said application and have denied the averments made in the application. Both parties tendered evidence namely Judgment Debtor examined his son Sri.Dhiraj Khurana as JDRW-1 and got marked 53 documents as Exhibits P-1 to P-53. Auction purchaser got himself examined as DHRW-1 and got marked 7 documents as Exhibits D-1 to D-7. Executing Court after considering the pleadings and evidence on record formulated following points for its determination: 1. Whether Judgment Debtor has made out substantial and reasonable ground to set aside the sale in respect

8 8 of the application schedule property and also to set aside the sale certificate dated which was presented before the Sub Registrar on for registration by allowing this application filed under Section 47 of Code of Civil Procedure? 2. What order? 7. After evaluating the evidence available on record and after considering the rival contentions raised, Executing Court has dismissed the application on following grounds: (a) When Judgment Debtor is seeking for setting aside sale on the ground of fraud or irregularity, application has to be filed under Order 21 Rule 90 as otherwise sale cannot be set aside; (b) Application under Order 21 Rule 90 CPC should have been filed within 60 days from the date of confirmation of sale and in the instant case neither such application was filed nor the application filed under Section 47 of CPC was within 60 days from the date of confirmation of sale. (c) Judgment Debtor has not deposited the auction amount or the decreetal amount

9 9 while filing the application in question as required under Order 21 Rule 89 of CPC; (d) The application in question is barred by limitation namely, it is filed beyond time prescribed under Article 127 of the Limitation Act, (e) Judgment Debtor did not enter the witness box and JDRW-1 does not have any knowledge regarding defence set up by the Judgment Debtor. (f) Evidence on record does not disclose fraud or irregularity in the conduct of auction sale or issue of sale certificate. 8. On abovestated grounds amongst others as elaborately discussed in its order dated application filed by the judgment debtor came to be dismissed by Executing Court 9. I have heard the arguments of Sri.M.Aswathnarayan Reddy, learned counsel appearing for appellant and Sri.Chandan S. Rao, learned counsel appearing on behalf of Sri.K.Suryanarayana Rao for

10 10 respondent No.1 and Sri.Ganapathi Hedge, learned counsel appearing for respondent No.2. Records secured from the Executing Court has been perused. 10. Sri.Aswathnarayan Reddy, learned counsel appearing for Judgment Debtor reiterating the contentions raised in the application filed under Section 47 of CPC before the Executing Court and grounds urged in the appeal memorandum would elaborate his submission by contending that it was mandatory on the part of the Executing Court to ensure that sale notice was served on the Judgment Debtor and same having not been served came to be conveniently overlooked by the Executing Court and as such all proceedings before the Executing Court is bad in law. He would submit that advancement of the case before the Executing Court from to is without notice to judgment debtor and therefore auction conducted is illegal and so also the confirmation of sale. He would

11 11 draw the attention of the court to the order sheet of the Executing Court to contend that as on sale notice issued had not been returned and yet without notice to Judgment Debtor the hearing date of the execution proceedings has been advanced and auction conducted at the spot and thereby judgment debtor had been deprived of opportunity to put forth his objection to auction sale or to deposit the decreetal amount before auction sale, and as such, sale proceedings are vitiated. He would also contend that application under Section 47 of CPC is to be filed within three years from the date of judgment debtor coming to know about the court auction sale and said application had been filed within three years from date of knowledge and even otherwise no limitation is prescribed for filing an application under Section 47 of CPC and as such application could not have been rejected on the ground of limitation. He would contend that Executing Court had not considered

12 12 that Judgment Debtor is in possession of the property in question and decree holder or auction purchaser had not obtained possession of the property through the process of Court and as such, sale of property is liable to be set aside. In support of his submissions he has relied upon the following Judgments: (1) AIR 1971 SC 2083 The Reliable Water Supply Service of India (P) Ltd., Vs The Union of India and others (2) AIR 1981 DELHI 291 Jiwan Dass Rawal Vs Narain Dass and others (3) AIR 2005 Madhya Pradesh 40 Om Prakash and others Vs Dwarka Prasad and anr (4) AIR 2008 SC 2061 M/s.Mahakal Automobiles and anr Vs Kishan Swaroop Sharma (5) 1988 ILR Karnataka 2237 M/s.Hotel Nataraja Vs Karnataka State Financial Corporation

13 13 (6) AIR 2004 Andhra Pradesh 465 A.C.Nagaraju Vs N.Sreenivasa Reddy (7) AIR 2003 Calcutta 218 Smt.Arati Daw Vs Pradip Roy Chowdhury and others 11. Per contra, Sri.Chandan Rao, learned counsel appearing for respondent No.1 by reiterating objections filed by the Judgment Debtor before the Executing Court would contend that when specific provision is available under Code of Civil Procedure to seek for setting aside the sale namely, Order 21 Rule 90 CPC, Section 47 CPC cannot be invoked. He would submit that under proviso to sub-rule (2) of Order 21 Rule 66 of CPC, Executing Court is not required to issue notice to the judgment debtor if notice for settling the terms of sale proclamation had been given to the judgment debtor by means of an order under Rule 54 and in the instant case an order of attachment having been passed in the suit itself on question of issuing sale

14 14 notice once again does not arise. He would also further contend that even otherwise sale notice had been issued to the Judgment Debtor as evidenced from the summons found in the records of the Executing Court and as such Judgment Debtor cannot now contend that sale notice was not served on him. He would contend that judgment debtor has not entered the witness box and none of the allegations made in the affidavit supporting the application came to be proved. But on the other hand the evidence of the JDRW-1 dated would indicate that he was not personally aware of the events narrated by judgment debtor in the affidavit supporting the application and as such no infirmity can be found in the order under challenge. In support of his submissions he has relied upon following Judgments: (1) AIR 1981 SC 693 S.A.Sundararajan Vs A.P.V.Rajendran

15 15 (2) (1963) I MYS.LJ 448 Nanjappa Vs Doddamuniswamy Gowda and anr 12. Sri.Ganapathi Hegde, learned counsel appearing for auction purchaser would adopt the arguments advanced by Sri.Chandan S. Rao with regard to merits of the case, but would hasten to add that appeal in question is not maintainable particularly after amendment brought to Code of Civil Procedure by Amendment Act 104 of 1976 and particularly the definition of Section 2(2) defining the word decree having undergone change. He would also contend that Section 47 of CPC being general provision has to yield to order 21 Rule 90 of C.P.C and when judgment debtor pleads for auction sale being set aside application was required to be filed under Order 21 Rule 90 CPC only and not under Section 47 of C.P.C. In support of his submissions he has relied upon the following Judgments:

16 16 (1) ILR 1994 KAR 145 Siddappa Vs Mariyappa (2) AIR 1983 BOM 378 Rameshkumar Swarupchand Sancheti and anr Vs Rameshwar Vallabhram Bhatwal and anr 13. In reply Sri.Aswathnarayan Reddy, learned counsel appearing for appellant- Judgment Debtor would contend that in the event of this court arriving at a conclusion that appeal is not maintainable, appellant be permitted to convert the present appeal to revision petition namely as a revision petition filed under Section 115 of CPC and in support of said submission he has relied upon Judgment of the Hon ble Apex Court in the case of THE RELIABLE WATER SUPPLY SERVICE OF INDIA (P) LTD., VS THE UNION OF INDIA AND OTHERS reported in AIR 1971 SC Having heard the learned advocates appearing for the parties and on perusal of the records this Court is of

17 17 the considered view that following points would arise for consideration: (1) Whether auction sale conducted by the Executing Court in selling the immovable property belonging to Judgment Debtor is liable to be set aside on any ground whatsoever? (2) Whether the appeal in question is maintainable or not? (3) What order? 15. Though answering question No.2 would have a direct bearing on the merits of the case and in the normal course this Court would have examined point No.2 formulated hereinabove at first instance, such course is not adopted, inasmuch as, learned advocates have addressed arguments on merits of the claim in extenso and learned counsel appearing for second respondent in this appeal i.e., auction purchaser by way

18 18 of his last limb of arguments has raised the issue of maintainability of this appeal. Hence, this Court is of the considered view that point No.1 deserves to be adjudicated at the first instance dehors the issue of maintainability of the appeal having been raised. Hence, point No.1 formulated hereinabove is taken up for consideration at the first instance and before adjudicating point No.2. RE: POINT NO.1: 16. In order to answer this point it would be necessary to extract the chronological list of dates and events which had unfolded before the Executing Court and same reads as under: SL. DATES EVENT NO O.S.No.5422/1993 was filed An order was passed in O.S.No.5422/1993 attaching the Property (site No.452, in Kengeri Satellite Town Layout

19 19 Extension, Bangalore) of the appellant The appellant herein entered appearance in O.S.No.5422/1993. The order of attachment was made absolute since the appellant failed to furnish security as directed by the Court Judgment and decree was passed in O.S.No.5422/1993 and the appellant herein was directed to pay a sum of Rs.1,70,000/- to the 1 st respondent herein with interest at 24% per annum from till realization Execution Petition No.220/1999 was filed by the 1 st respondent Notice for settling sale proclamation (Form No.28) was served on the appellant Sale Proclamation was issued (Form No.29) Spot sale of the Property was conducted Court sale of the property was conducted The sale was confirmed in favour of the 2 nd respondent-auction purchaser Sale certificate was issued in favour of the 2 nd respondent The appellant filed miscellaneous No.1115/2003 praying that the Judgment and decree in O.S.No.5422/1993 be set aside.

20 The appellant filed an application under Section 47 read with Section 151 of the Code of Civil Procedure, 1908 praying that the sale of the property be set aside Miscellaneous No.1115/2003 was dismissed The application filed under Section 47 read with Section 151 of the Code of Civil Procedure, 1908 was dismissed and the execution petition was closed. 17. A perusal of the affidavit supporting the application filed under Section 47 of CPC by the judgment debtor would indicate that plea raised thereunder was clearly omnibus or in other words exhaustive and judgment debtor has sought for auction sale conducted by the Executing Court being set aside. Thus, grounds urged in the said affidavit will have to be examined to find out as to whether such grounds would fall within the domain of Order 21 Rule 90 of C.P.C or it can be construed as one falling exclusively under Section 47 of C.P.C. as sought to be made out by

21 21 respondents since said application though styled as having been filed under Section 47 CPC and in effect it is to be treated as one having filed under Order 21 Rule 90 CPC inasmuch as, issue of limitation would arise for consideration if it is held that application in question is to be treated as one filed under Order 21 Rule 90 CPC. 18. Perusal of the application would indicate auction sale conducted by the Executing Court is sought for being set aside on the following grounds: (1) The auction purchaser is none other than the husband of decree holder and they have colluded against each other and purchased the property for a sum; (2) The Bank Manager where judgment debtor has availed credit facility is best friend of auction purchaser and the decree holder; (3) The decree holder and auction purchaser had practiced fraud and thereby sold the property for low price; (4) Executing Court has not served any notice on judgment debtor before auctioning the property and as such,

22 22 sale is void, illegal and contrary to law (vide paragraph 11 of the affidavit supporting the application); (5) Auction suffers from material irregularity and legal infirmities and is in contravention of Rule 128 of Karnataka Civil Rules of Practice. Hence, it is not a sale in the eye of law. When the above plea put forward by the judgment debtor is examined in the background of Rule 90 of Order 21 CPC, it would not detain this Court too long to arrive at a conclusion that application in question is required to be considered as one filed under Order 21 Rule 90 CPC. A conjoined reading of the above pleadings would indicate that the judgment debtor has applied to the Court to set aside the sale on the ground of material irregularity and fraud in publishing the sale notice and sale proclamation and so also proceedings relating to conducting of auction sale. It has been held by the Hon ble Apex Court in the case of S.A.SUNDARARAJAN vs. A.P.V.RAJENDRAN reported

23 23 in AIR 1981 SC 693 that mere irregularities such as the error committed while conducting sale like not drawing up the sale proclamation in accordance with law, not showing certain payments, nor omission to mention the tax paid or payable, would fall within Rule 90 and not under Section 47 CPC. Hence, it is held that the application in question is to be treated as having been filed under Order 21 Rule 90 CPC and it cannot be construed as an application filed under Section 47 CPC simplicitor. 19. A sale can be set aside by the Executing Court on the ground of irregularity or fraud occurring in sale of a property as contemplated under Order 21 Rule 90 of CPC if such plea is put forward and proved. Article 127 of the Limitation Act, 1963 mandates that an application to set aside a sale in execution of a decree has to be filed within 60 days from the date of sale.

24 24 Undisputedly in the instant case spot sale of the property came to be conducted on and Court sale came to be conducted on and sale was confirmed in favour of auction purchaser on Sale certificate came to be issued in favour of auction purchaser on JDRW-1 has admitted in his evidence dated that sale confirmation took place on and sale certificate came to be issued in favour of auction purchaser on It is also admitted by him that they came to know about the auction of the property on when he visited the BDA office. His admission in the cross examination dated reads as under: My father is still xxx by my father. In this case an auction took place on The sale was confirmed by the court on Sale certificate was issued on The auction purchaser has deposited Rs.4,00,000/-. The decree holder withdrew the said amount from the

25 25 court. On 18 th Dec. 2002, we came to know the auction of the property when we visited the BDA office. As on the day, the Khatha was already changed to the auction purchaser. 20. The above admission would clearly indicate that the Judgment Debtor knew about the property in question having been auctioned and the khatha of the said property having been made over to the name of auction purchaser. Having noticed this aspect the Judgment Debtor filed a miscellaneous petition in Misc. No.1115/2003 on which also came to be dismissed on Even when Judgment Debtor came to know about sale having taken place on he did not take steps as expected of a person of reasonable prudence. Judgment debtor though knew about auction sale having taken place on and its confirmation having been made on did not file application to set aside auction

26 26 sale. However, application under Section 47 CPC came to be filed only on In the instant case the Judgment Debtor has not entered the witness box. It is his son who has entered the witness box and no reasons are forthcoming as to why Judgment Debtor did not enter the witness box. Factual aspects which are not within the knowledge of the agent cannot be taken note of and any amount of evidence tendered by an agent on behalf of the principal which relates to factual aspects and which facts are not within agents personal knowledge would only be hear say evidence and much credence cannot be attached. In the instant case records would indicate that JDRW.1 has tendered his evidence namely, Examination-in- Chief by filing an affidavit dated and has stated that Judgment Debtor had shifted to Delhi during 1997 due to ill health of his father and in order to take care of him, he shifted his transport business

27 27 also to Delhi. However, in the cross-examination dated it is admitted by him that he has not produced any documents to substantiate his statement made in paragraphs 6 and 7 of his affidavit. This would only indicate that plea raised by Judgment Debtor has remained as a plea without proof. Hence, it has to be held that the application in question having not been filed within 60 days from the date of sale ( date of confirmation of sale in favour of second respondent auction purchaser) as required under Article 127 of the Limitation Act, 1963, said application was liable to be dismissed on the ground of limitation and finding has been rightly recorded by the Executing Court to the said effect. 22. Yet another contention which came to be raised by the Judgment Debtor in the present proceedings relates to non issuance of notice as required under sub-rule (2) of Rule 66 of Order 21 CPC to him before sale

28 28 proclamation. In order to examine said plea, it would be necessary to extract Order 21 Rule 66 CPC and it reads as under: 66. Proclamation of sales by public auction.-(1) Whether any property is ordered to be sold by public auction in execution of a decree, the Court shall cause proclamation of the intended sale to be made in the language of such Court. (2) Such proclamation shall be drawn up after notice to the decreeholder and the judgment-debtor and shall state the time and place of sale, and specify as fairly and accurately as possible- (a) (b) the property to be sold (or, where a part of the property would be sufficient to satisfy the decree, such part); the revenue assessed upon the estate or part of the state, where the property to be sold is an interest in an estate or in part of an estate paying revenue to the Government;

29 29 (c) (d) (e) any encumbrance to which the property is liable; the amount for the recovery of which the sale is ordered; and every other thing which the Court considers material for a purchaser to know in order to judge of the nature and value of the property: [Provided that where notice of the date for settling the terms of the proclamation has been given to the judgment-debtor by means of an order under rule 54, it shall not be necessary to give notice under this rule to the judgment-debtor unless the Court otherwise directs: Provided further that nothing in this rule shall be construed as requiring the Court to enter in the proclamation of sale its own estimate of the value of the property, but the proclamation shall include the estimate, if any, given, by either or both of the parties. (3) Every application for an order for sale under this rule shall be accompanied by a statement signed and verified in the manner hereinbefore prescribed for the signing

30 30 and verification of pleadings and containing, so far as they are known to or can be ascertained by the person making the verification, the matters required by sub-rule (2) to be specified in the proclamation. (4) For the purpose of ascertaining the matters to be specified in the proclamation, the Court may summon any person whom it thinks necessary to summon and may examine him in respect to any such matters and require him to produce any document in his possession or power relating thereto. 23. Perusal of sub-rule (1) would indicate that where a property is ordered to be sold by public auction in execution of a decree, Executing Court should cause proclamation of the intended sale to be made in the language of the Court and under sub-rule (2) such proclamation will be drawn up by the Executing Court after notice to the decree holder and judgment debtor indicating thereunder time, place of sale and details enumerated in clauses (a) to (e) of sub-rule (2).

31 31 However, exception for non issuance of notice to Judgment Debtor is when the notice of the date for settling the terms of the proclamation has been already given to such judgment debtor by means of order under Rule 54 of Order 21 CPC and in such circumstances, it shall not be necessary for the Executing Court to give notice under this Rule to the judgment debtor, unless the Executing Court otherwise directs. The Hon ble Apex Court in the case of M/S. MAHAKAL AUTOMOBILES AND ANOTHER vs KISHAN SWAROOP SHARMA reported in AIR 2008 SC 2061 has held that it is mandatory to issue notice to the judgment debtor at each stage. It has been held by the Hon ble Apex Court as under: 6. When a property is put up for auction to satisfy a decree of the Court, it is mandatory for the Court executing the Decree, to comply with the following stages before a property is sold in execution of a particular decree:

32 32 (a) Attachment of the Immoveable Property: (b) (c) Proclamation of Sale by Public Auction; Sale by Public Auction 7. Each stage of the sale is governed by the provisions of the Code. For the purposes of the present case, the relevant provisions are Order 21 Rule 54 and Order 21 Rule 66. At each stage of the execution of the decree, when a property is sold, it is mandatory that notice shall be served upon the person whose property is being sold in execution of the decree, and any property which is sold, without notice to the person whose property is being sold is a nullity, and all actions pursuant thereto are liable to be struck down/quashed. 8. The admitted position that has emerged is that: (i) (ii) There was no notice served upon the Judgment-Debtor under Order 21, Rule 54 (1-A). There was no valuation of the property carried out;

33 33 (iii) (iv) There was no proclamation of sale as per the statutory provisions of the M.P. Civil Court Rules, 1961 read with Order 21, Rule 66. There was no publication of the sale. 24. The Hon ble Apex Court has held in the case of DESH BANDHU GUPTA vs N.L.ANAND AND ANOTHER reported in 1993 AIR SCW 3458 that service of notice on judgment debtor of proposed sale of his property is mandatory and omission to serve the notice is nullity. It has been held by the Hon ble Apex Court as under: 9. However, there is considerable force in the contention of the appellant that the procedure prescribed under Order 21, Rule 66 was flagrantly violated by the Executing Court. We have already noted the order of the Court to conduct the sale. For judging its legality and validity, it would be desirable to have a bird's eye view of the procedure for sale of immovable property in execution. On an application for execution filed under Order 21, Rule 5 the Court shall ascertain the compliance of the pre-

34 34 requisites contemplated under Rule 17 and on finding the application in order, it should be admitted and so to make an order thereon to issue notice under Rule 22, subject to the conditions specified therein. If a notice was served on the judgment-debtor as enjoined under Order 5 but he did not appear or had not shown cause to the satisfaction of the Court, under Rule 23 the Court "shall order the decree to be executed". If an objection is raised to the execution of the decree, by operation of sub-rule (2) thereof, "the Court shall consider such objections and make such order as it thinks fit". Thereafter in the case of a decree for execution against immovable property an attachment under Rule 54 should be made by an order prohibiting the judgment-debtor from transferring or creating encumbrances on the property. Under Rule 64 the Court may order sale of the said property. Under Rule 66(2) proclamation of sale by public auction shall be drawn up in the language of the Court and it should be done after notice to the decree-holder and the judgment- debtor and should state "the time and place of sale" and "specified as fairly and accurately as possible" the details specified in Clauses (a) to (d) of sub-rule (2) thereof. The Civil Rules of Practice in Part L in the Chapter 12 framed by the High Court of Delhi 'Sale of Property

35 35 and Delivery to the Purchaser' Rule 2 provides that whenever a Court makes an order for the sale of any attached property under Order 21, Rule 64, it shall fix a convenient date not being distant more than 15 days, for ascertaining the particulars specified in Order 21, Rule 66(2) and settling the proclamation of sale. Notice of the date so fixed shall be given to the parties or their pleaders. In Rule 4 captioned 'Settlement of Proclamation of Sale, Estimate of Value' it is stated that on the day so fixed, the Court shall, after perusing the document, if any AND the report referred to in the preceding paragraph, after examining the decreeholder and judgment-debtor, if present, AND after making such further enquiry as it may consider necessary, settle the proclamation of sale specifying as clearly and accurately as possible the matters required by Order 21, Rule 66(2) of the Code. The specifications have been enumerated in the rule itself. The proclamation for sale is an important part of the proceedings and the details should be ascertained and noted with care. This will remove the basis for many a belated objections to the sale at a later date. It is not necessary to give in any proclamation of sale the estimate of the value of the property. The proclamation when settled shall be signed by the Judge and get it published in manner

36 36 prescribed by Rule 67. The Court should authorise its officers to conduct the sale. Under Rule 68 the sale should be conducted at "the place and time" specified or the time may be modified with the consent in writing of the judgment-debtor. The proclamation should include the estimate, if any, given by either judgment- debtor or decree-holder or both the parties. Service of notice on judgment-debtor under Order 21; Rule 66(2), unless waived by appearance or remained ex parte, is a fundamental step in the procedure of the Court in execution. Judgment- debtor should have an opportunity to give his estimate of the property. The estimate of the value of the property is a material fact to enable the purchaser to know its value. It must be verified as accurately and fairly as possible so that the intending bidders are not misled or to prevent them from offering inadequate price or to enable them to make a decision in offering adequate price. In Gajadhar Prasad v. Babu Bhakta Ratan, (1974) 1 SCR 372: (AIR 1973 SC 2593), this Court, after noticing the conflict of judicial opinion among the High Courts, held that a review of the authorities as well as the amendments to Rule 66(2)(e) make it abundantly clear that the Court, when stating the estimated value of the property to be sold, must not accept merely the ipse

37 37 dixit of one side. It is certainly not necessary for it to state its own estimate. If this was required, it may, to be fair, necessitate insertion of something like a summary of a judicially considered order, giving its grounds, in the sale proclamation, which may confuse bidders. It may also be quite misleading if the Court's estimate is erroneous. Moreover, Rule 66(2)(e) requires the Court to state only nature of the property so that the purchaser should be left to judge the value for himself. But, the essential facts which have a bearing on the very material question of value of the property and which could assist the purchaser in forming his own opinion must be stated, i.e., the value of the property, that is, after all, the whole object of Order 21, Rule 66(2)(e), CPC. The Court has only to decide what are all these material particulars in each case. We think that this is an obligation imposed by Rule 66(2)(e). In discharging it, the Court should normally state the valuation given by both the decree-holder as well as the judgment-debtor where they both have valued property AND it does not appear fantastic. It may usefully state other material facts, such as the area of land, nature of rights in it, municipal assessment, actual rents realised, which could reasonably and usefully be stated succinctly in a sale

38 38 proclamation has to be determined on the facts of each particular case. Inflexible rules are not desirable on such a question. It could also be angulated from another perspective. Sub-rule (1) of Rule 66 enjoins the Court that the details enumerated in sub-rule (2) shall be specified as fairly and accurately as possible. The duty to comply with it arises only after service of the notice on the judgment-debtor unless he voluntarily appears and gives opportunity in the settlement of the value of the property. The absence of notice causes irremediable injury to the judgment-debtor. Equally publication of the proclamation of sale under Rule 67 and specifying the date and place of sale of the property under Rule 66(2) are intended that the prospective bidders would know the value so as to make up their mind to offer the price and to attend at sale of the property and to secure competitive bidders and fair price to the property sold. Absence of notice to the judgment-debtor disables him to offer his estimate of the value who is better knows its value and to publicise on his part canvassing and bringing the intending bidders at the time of sale. Absence of notice prevents him to do the above and also disables him to know fraud committed in the publication and conduct of sale or other material irregularities in the

39 39 conduct of sale. It would be broached from yet another angle. The compulsory sale of immovable property under Order 21 divests right, title and interest of the judgment-debtor and confers those rights, in favour of the purchaser. It thereby deals with the rights and disabilities either of the judgment-debtor or the decree- holder. A sale made, therefore, without notice to the judgment-debtor is a nullity since it divests the judgment- debtor of his right, title and interest in his property without an opportunity. The jurisdiction to sell the property would arise in a Court only where the owner is given notice of the execution for attachment and sale of his property. It is very salutary that a person's property cannot be sold without his being told that it is being so sold and given an opportunity to offer his estimate as he is the person who intimately knew the value of his property and prevailing in the locality, exaggeration may at time be possible. In Rajagopala Iyer vs. Ramachandra Iyer. ILR 47 Mad 288: (AIR 1924 Madras 431), the Full Bench held that a sale without notice under Order 21 Rule 22 is a nullity and is void and that it has not got to be set aside. If an application to set aside such a void sale is made it would fall under Section 47.

40 Above discussion do indicate discernible rule that service of notice on the judgment-debtor is a fundamental part of the procedure touching upon the jurisdiction of the Execution Court to take further steps to sell his immovable property. Therefore, notice under Order 21, Rule 66(2), unless proviso is applied (if not already issued under Order 21, Rule 22) AND service is mandatory. It is made manifest by Order 21, Rule 54 (1A) brought on statute by 1976 Amendment Act with peremptory language that before settling the terms of the proclamation of sale. The omission thereof renders the further action and the sale in pursuance thereof void unless the judgmentdebtor appears without notice and thereby waives the service of notice. 25. There cannot be any dispute with regard to the proposition that if there is non issuance of notice as required under Order 21 Rule 66(2) sale conducted pursuant to such sale proclamation would render the proceedings void. In this background it requires to be examined as to whether notice had been issued to the judgment debtor before drawing up of sale proclamation

41 41 or not. Appendix E to Code of Civil Procedure, 1908 would indicate that Executing Court is required to issue notice in Form No.28 to a judgment debtor informing him of the date which has been fixed for settling the terms of proclamation of sale. Perusal of the original records would indicate that notice in Form No.28 has been issued by the Executing Court to the judgment debtor which is available at page 278 of the records and as could be seen from reverse side of the said notice, judgment debtor has affixed his signature after receiving the same on which has not been expressly denied by the judgment debtor in any proceedings. 26. Order sheet of the Executing Court would indicate that on sale notice was ordered to be issued to the judgment debtor. On fresh notice came to be ordered on the judgment debtor and it was ordered to be listed on On the said date,

42 42 Registry of the Executing Court has made a note to the following effect: sale notice to Jdr issued returned served on person After having noticed the said note made by the Registry, the Executing Court has recorded as under: Jdr called out. Absent. Service of sale notice is sufficient. Office to verify the sale papers. The above note made by the Executing Court would clearly indicate that notice has been issued to the judgment debtor before drawing up of the sale proclamation and same is duly served on judgment debtor as could be seen from the summons available in record, which is duly returned by the bailiff and same is available at page 278 of Executing Court records. In other words, there is due compliance of Order 21 Rule 66(2) of CPC and there is no infraction of the said rule so as to arrive at a conclusion that for want of issuance

43 43 of such notice, sale proceedings is vitiated. Hence, point No.(1) is answered in the negative namely, against appellant and in favour of respondents. RE: POINT NO.(2): 27. If the application though filed to set aside the sale on the ground of fraud and irregularity is to be construed as one having been filed under Section 47 CPC, then, necessarily it has to be held that the present appeal as not being maintainable for the following reasons. Order under Section 47 CPC to be treated as a decree must have decided rights of the parties with regard to the matter in controversy in the proceedings under said Section. For this proposition, judgment of Hon ble Apex Court in AIR 1967 SC 1344 (Ramchandra SPG. & WVG. Mills vs. Bijli Cotton Mills & others) can be looked up.

44 Section 2(2) CPC defines decree to mean formal expression of adjudication on the rights of the parties with regard to all or any of the matters in controversy. In other words, decree must be the result of adjudication or it must determine rights of the parties conclusively and finally. 29. All questions arising between the parties to the suit in which decree was passed have to be determined by the Court executing the decree as per Section 47 CPC. 30. When sale of immovable property in execution of a decree whose validity is not questioned, is attacked as illegal and void, it would be a question under Section 47 CPC which has to be determined by the Executing Court itself. For this proposition, AIR 1967 SC 1344 can be looked up.

45 Hence, definition of decree and the statutory provision which had been invoked by the appellant before the Executing Court will have to be noticed. Hence, Section 2(2) and Section 47 CPC are extracted herein below: 2. Definitions. - In this Act, unless there is anything repugnant in the subject or context,- (1) xxx (2) decree means the formal expression of an adjudication which, so far as regards the Court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final. It shall be deemed to include the rejection of a plaint and the determination of any question within section 144, but shall not include- (a) any adjudication from which an appeal lies as an appeal from an order, or (b) any order of dismissal for default.

46 46 Explanation. - A decree is preliminary when further proceedings have to be taken before the suit can be completely disposed of. It is final when such adjudication completely disposes of the suit. It may be partly preliminary and partly final; 47. Questions to be determined by the Court executing decree.- (1) All questions arising between the parties to the suit in which the decree was passed, or their, representatives, and relating to the execution, discharge or satisfaction of the decree, shall be determined by the Court executing the decree and not by a separate suit. (2) omitted (3) xxx 32. Perusal of Section 2(2) of CPC would indicate that by Act No.104/1976 it came to be amended with effect from The words Section 47 or after the words determination of any question within and before the words Section 144 came to be omitted. Thus, it would clearly indicate, prior to amendment, order

47 47 passed under Section 47 of CPC by the Executing Court was falling within the definition of a decree as defined under Section 2(2) CPC and as such, this Court as well as Hon ble Apex Court has consistently held that an appeal would lie against such an order. However, by virtue of amendment brought to Section 2(2) by amending Act 104/1976 and Section 47 having been omitted from the definition clause of Section 2(2) CPC, it cannot be held that such an order would partake the character of a decree so as to cloth this Court to entertain an appeal against an order passed under Section 47 by the Executing Court. 33. A co-ordinate Bench of this Court in the case of H.VEERAPPA vs CHANNABASAPPA LAKSHMESHWAR reported in ILR 1982(2) KAR. SHORT NOTES 56) has held that by virtue of amendment to CPC namely, Section 47 CPC having been omitted from the definition

48 48 of decree, appeal would not be maintainable and revision is competent. 34. A co-ordinate Bench of this Court in the case of BASAPPA vs H.K.SATYANARAYA SETTY reported in ILR 1978(2) KAR has held that omission of Section 47 in Section 2(2) CPC has resulted in such orders being held as not amenable to appellate jurisdiction. In that view of the matter, it has to be held that present Execution First Appeal would not be maintainable. 35. Thus, viewed from any angle, there is no merit in this appeal and same is liable to be dismissed both on merits and on the ground of appeal not being maintainable. 36. For the reasons stated herein above, I proceed to pass the following:

49 49 ORDER (1) Execution First Appeal is hereby dismissed. (2) Order dated passed in Ex.No.220/1999 by the 5 th Addl.City Civil Judge, Bangalore dismissing the application filed by the judgment debtor under Section 47 CPC r/w Section 151 CPC is hereby affirmed. (3) Costs made easy. Sd/- JUDGE SBN/sp