Andhra Pradesh High Court - Amravati
Akkireddy Rammohan Rao, vs Vardhineedi Narasimha Rao, on 22 July, 2020
Author: M.Ganga Rao
Bench: M.Ganga Rao
HON'BLE SRI JUSTICE M.GANGA RAO
CIVIL REVISION PETITION No.2055 of 2011
ORDER:
This Civil Revision Petition is filed under Section 115 of the Code of Civil Procedure, 1908 being aggrieved by the order dated 03.12.2010 passed in C.M.A.No.31 of 2009 by the learned VI Additional District Judge (FTC), Narsapur, wherein and whereby the order dated 11.02.2009 passed in E.A.No.136 of 2005 in E.P.No.94 of 2004 in O.S.No.94 of 2001 by the Senior Civil Judge, Narsapur was set aside and E.A.No.136 of 2005 was allowed setting aside the sale dated 25.02.2005 conducted in E.P.No.94 of 2004.
2. The revision petitioner is the Decree-holder (D.Hr.) and the 1st respondent is the Judgment-debtor (J.Dr.). The 2nd respondent is the gift settlement holder of the part of the E.P. schedule auction sale property and none other than the daughter of the 1st respondent/J.Dr.
3. For the sake of convenience, the parties herein are referred to as D.Hr., J.Dr. and the daughter of J.Dr.
4. The D.Hr. obtained decree and judgment in O.S.No.94 of 2001 passed by the Senior Civil Judge's Court, Kothapeta against the J.Dr. The E.P. schedule property was attached before judgment and the said attachment was made absolute. Subsequently, the decree was transferred to the Senior Civil 2 Judge's Court, Narsapur for execution of decree by sale of the attached property in E.P.No.94 of 2004. The Senior Civil Judge, Narsapur issued the sale notice and conducted sale on 25.02.2005 for the entire land extent Ac.2.54 cents for Rs.9,20,000/-, for realization of the warrant amount of Rs.1,92,742/- (less than Rs.2 lakhs), but the land is under mortgage to the Primary Agricultural Co-operative Society, Digamarru though the amount is not spelt out.
5. The J.Dr. filed E.A.No.136 of 2005 on 13.04.2005 under Order XXI Rule 90 and Section 47 C.P.C. to set aside the sale conducted on 25.02.2005 i.e., within two months from the date of sale and later the daughter of the J.Dr. was added as 2nd petitioner as per the order dated 10.11.2005 passed in E.A.No.376 of 2005, mainly contending that the sale conducted on 25.02.2005 is vitiated by material irregularities and fraud. The interest of the J.Dr. and his daughter are materially and adversely affected for the reason that the notices under Order XXI Rule 66 and 64 C.P.C. are not in the prescribed form and they are general notices only. The notices are not specific and they do not reveal the particulars of the information as prescribed under the provisions of Rule 66(2) of Order XXI. The D.Hr. has deliberately played fraud on the Court by procuring his own persons as bidders and got the sale conducted with the help of the said persons for a lesser price and got the same struck for lesser amount. 3
6. In support of the petition averments before the E.P. Court, the J.Dr. and his daughter got examined PWs 1 to 6 and marked Exs.A.1 and A.2. On behalf of the D.Hr., he himself was examined as RW1 and got marked Exs.B.1 and B.2. Exs.C.1 and C.2 were got marked through Court.
7. The E.P. Court, after careful consideration of the evidence on record, came to the conclusion that the J.Dr. was very much on record and contested the E.P., as such he is well aware about the proceedings from time to time and all the pleas raised in the petition are already available to the J.Dr. on the date of proclamation and sale. None of the witnesses had spoken about the fraud and material irregularities which allegedly caused substantial injury to the J.Dr. The E.P. Court dismissed the petition by holding that no substantial injury or material irregularity or fraud was established by the J.Dr. and the J.Dr. was estopped from raising the pleas which are already available to him prior to conduct of the sale, and there was no cogent proof to show that the bidders were the henchmen of the D.Hr.
8. Being aggrieved by the dismissal of E.A.No.136 of 2005 by the E.P. Court, C.M.A.No.31 of 2009 was preferred to the lower appellate Court. The lower appellate Court allowed the C.M.A. setting aside the order of E.P. Court by holding that no notices under Order XXI Rule 64 and 66 C.P.C. were issued to the J.Dr. to furnish his valuation of the property 4 and that the sale of one acre out of total extent of Ac.2.54 cents could have been sufficient for the satisfaction of the entire decretal amount. Instead the E.P. Court conducted the sale of entire property and thereby substantial injury was caused to the J.Dr. Accordingly, the Civil Miscellaneous Appeal is allowed setting aside the order of the E.P. Court, which is challenged in the present revision before this Court.
9. The issue that falls for consideration of this Court is - whether there is any irregularity or fraud in publishing or conducting sale which causes substantial injury to the J.Dr. as required under Order XXI Rule 90 C.P.C.?
10. Sri M.V.S.Suresh Kumar, learned senior counsel appearing for the petitioner/D.Hr., would contend that the lower appellate court grossly erred in holding that the notices under Order XXI Rule 54(1)(A) and 66 of C.P.C. were not served and that notice served under Rule 22 of Order XXI of C.P.C. is not sufficient opportunity to put forth the plea of J.Dr. for settling the terms of the proclamation of sale, as the evidence on record shows that the notice under Order XXI Rule 66(2)(e) was served and even the J.Dr's case is that the notices served are general in form but not in specified forms and thereby the J.Dr. was deprived of his opportunity to raise his objections for issuance of proclamation.
11. Per contra, Sri G.Rama Gopal, learned counsel appearing for Sri S.A.K.S. Reddaiah, learned counsel for 5 respondents/J.Dr. and his daughter, would contend that the non-service of proper notices deprived the J.Dr. to raise his objections for proclamation and the E.P. Court ought not to have put the entire schedule property for sale for realization of the warrant amount of Rs.1,92,742/-. In support of his contentions, he placed reliance on the decision of the Hon'ble Supreme Court in Ambati Narasayya Vs. M.Subba Rao and another1, wherein it is held thus:
"It is of importance to note from this provision that in all execution proceedings, the Court has to first decide whether it is necessary to bring the entire attached property to sale or such portion thereof as may seem necessary to satisfy the decree. If the property is large and the decree to be satisfied is small, the Court must bring only such portion of the property, the proceeds of which would be sufficient to satisfy the claim of the decree-holder. It is immaterial whether the property is one or several. Even if the property is one, if a separate portion could be sold without violating any provision of law only such portion of the property should be sold. This, in our opinion, is not just a discretion, but an obligation imposed on the Court. Care must be taken to put only such portion of the property to sale the consideration of which is sufficient to meet the claim in the execution petition. The sale held without examining this aspect and not in conformity with this requirement would be illegal and without jurisdiction."
The learned counsel also relied on the decision of this Court in C.Rayan Babu Vs. B.K.L. Traders rep. by its Proprietor and another2, wherein it is held thus:
"...1
AIR 1990 S.C. 119(1) 2 2010 (5) ALT 217 6 There is no dispute about the proposition of law laid down by the apex Court. In the case on hand, the Executing Court has not exercised its discretion judiciously in fixing the upset price and secondly the procedure as contemplated under Order XXI Rule 64 CPC has not been followed to know whether the property is divisible and whether a part of the property can be brought for sale which would satisfy the decree. In my considered opinion, these two aspects amount to material irregularity, which would vitiate the sale. Hence, the sale is liable to be set aside as no prejudice of whatsoever would be caused if the sale is set aside. Admittedly, half of the decretal amount has been satisfied."
12. The D.Hr. obtained the money decree in O.S.No.94 of 2001 passed by the Senior Civil Judge's Court, Kothapeta against the J.Dr. The decree was transferred to the Senior Civil Judge's Court, Narsapur for execution of decree by sale of the attached property in E.P.No.94 of 2004. The E.P. schedule property was attached before the judgment and the attachment was made absolute.
13. A perusal of the record shows that the J.Dr. was very much on record and contested the E.P. proceedings. The E.P. Court, after rejecting all the objections of J.Dr., issued proclamation for sale of E.P. schedule property and auction sale was conducted on 25.02.2005 and in the bid, auction was knocked down for Rs.9,20,000/- for the E.P. schedule property admeasuring Ac.2.54 cents. As on the date of Court auction, the schedule property was under mortgage to Primary Agricultural Co-operative Society, Digamarru and auction was conducted by the Court subject to mortgage. It 7 further reveals that during the subsistence of the Court attachment of the E.P. schedule property, the J.Dr. executed a Gift settlement deed (Ex.B.2) on 07.08.2004 in respect of the land extent Ac.1.67 cents (Ac.1.46 cents in R.S.No.7/1 and Ac.0.21 cents in R.S.No.7/2) in favour of his daughter and a Sale deed (Ex.B.1) on 31.12.2004 in respect of the land extent Ac.1.14 cents in R.S.No.7/1 in favour of one Gubbala Manikaya for a sale consideration of Rs.2,28,000/- at Rs.2,00,000/- per acre. But, in the Court sale, it fetched Rs.9,20,000/-.
14. The learned counsel appearing for the respondents/J.Dr. and his daughter made all out efforts to substantiate the order of the lower appellate court. But, the decree and judgment of the lower appellate court does not enure his contentions, in view of the different factual matrix of the present case as stated supra. Further, the lower appellate court failed to consider that the J.Dr. having alienated the attached immovable property extent Ac.1.14 cents in favour of one Gubbala Manikaya through Ex.B.1 dated 31.12.2004 and Ac.1.46 cents in favour of 2nd respondent through Ex.B.2 dated 07.08.2004, has not shown any interest in the E.P. proceedings, might be on the legal advice to protract the litigation somehow or other and to postpone the ripe of the fruits of the decree by D.Hr. 8
15. It is well settled law that after denial of J.Dr.'s objections and the auction sale having became final, auction sale made in favour of the auction purchaser cannot be set aside as held by the Hon'ble Supreme Court in the case of Rajju Khan Vs. Rafiq Khan and another [2004 (13) SCC 545].
16. The property was put to auction on 25.02.2005 for the entire schedule property to an extent of Ac.2.54 cents for Rs.9,20,000/-. The finding of the lower appellate court on the auction sale is as follows:
"I have gone through the sale proceeds and it appears that three persons participated in the auction along with D.Hr. and the upset price fixed as Rs.5,10,000/- and bid knocked at Rs.9,20,000/- which is double the upset price. The petitioners have not shown any material to accept that the three persons participated in the auction are relations or own persons of D.Hr. Hence, the plea of fraud pleaded by the petitioners liable to be rejected. Regarding the irregularities pointed out by the petitioners at the time of the proclamations, as rightly held by the lower court, the petitioners cannot be permitted to raise such objections once again allowing the sale proceedings in the court on 25.02.2005. The oral evidence adduced by the petitioners is no way useful to decide the point in controversy."
17. However, the lower appellate court, having considered the entire evidence on record, grossly erred in setting aside the order and decree of the E.P. Court and allowing the Civil Miscellaneous Appeal stating that the E.P. Court could have gone for sale of one acre as the sale of one acre out of the total extent of Ac.2.54 cents would have been sufficient for the satisfaction of the entire decree.
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18. On the other hand, all the pleas and objections of the J.Dr. have been carefully considered by the E.P. Court and the J.Dr. could have raised the said pleas at the time of proclamation of sale, which is available to him prior to the conduct of sale. Further, the sale proceeds have to be satisfied the decretal amount payable to the D.Hr. and the amount due to the Primary Agricultural Co-operative Society, Digamarru, for which the landed property was mortgaged. The lower appellate court could have seen that the notice under Order XXI Rule 64 of C.P.C. was served on the J.Dr. and he contested the E.P. before the Executing Court. In those circumstances, it cannot be said that the notices were not specific and the J.Dr. was not aware of the auction sale.
19. The important issue this Court has to be kept in mind that the J.Dr. gifted some part of the E.P. schedule property to his daughter and alienated the remaining part of the E.P. schedule property, which is under attachment as well mortgaged. Further, there is no evidence to show that due to fraud or irregularity, auction was knocked down to lesser price.
20. Though there is no dispute about the proposition of law laid down by the Hon'ble Supreme Court in the two citations relied on by the learned counsel for respondents/J.Dr. and his daughter, they cannot be helpful as the facts in the referred cases are totally different to that of the facts of the 10 present case. In the present case, the property was sold at Rs.9,20,000/-, which is double the upset price and that the mortgage amount is not spelt out. Hence, at no stretch of imagination, it can be said that the property was sold for lesser price in view of the fraud and material irregularity played by the D.Hr. in putting the schedule property for auction sale.
21. Hence, the lower appellate court erred in allowing the petition filed under Order XXI Rule 90 of C.P.C. as the J.Dr. failed to show any fraud and material irregularity in publishing proclamation and conducting sale which allegedly caused substantial injury and no facts are proved as required under sub-rules (2) & (3) in Rule 90 of Order XXI of C.P.C.
22. Hence, the Civil Revision Petition is allowed, setting aside the judgment dated 03.12.2010 passed in C.M.A.No.31 of 2009 on the file of the learned VI Additional District Judge (FTC), Narsapur and confirming the order dated 11.02.2009 passed in E.A.No.136 of 2005 in E.P.No.94 of 2004 in O.S.No.94 of 2001 on the file of the Senior Civil Judge, Narsapur. No order as to costs.
23. As sequel to it, Miscellaneous Petitions, if any pending, shall stand closed.
__________________ M.GANGA RAO, J Date: 22.07.2020 Ivd/anr 11 THE HON'BLE SRI JUSTICE M.GANGA RAO CIVIL REVISION PETITION No.2055 OF 2011 Date: 22.07.2020 Ivd/anr