Telangana High Court
Yaragani Yagaiah vs M/S Andhra Bank on 2 August, 2022
Author: P. Sree Sudha
Bench: P. Sree Sudha
THE HON'BLE SMT. JUSTICE P. SREE SUDHA
CIVIL REVISIOIN PETITION No.1080 OF 2020
ORDER:
1. The Civil Revision Petition No. 1080 of 2020 is filed against the rejection of the trial Court in docket order dt.02.11.2019 in E.A. (SR) No.2152 of 2019 in E.P. No. 83 of 2015 in which it was stated as follows:
"As per Section under Order XXI Rule 90(3) of C.P.C., no application to set aside a sale under this rule shall be entertained upon any ground which the applicant could not taken as the proclamation was filed on 18.09.2018 and sale conducted on 01.04.2019 and sale confirmed on 03.06.2019. Hence, returned. Petition is not maintainable."
2. It is stated that he is the Judgment Debtor No.1 and he filed an application under Order XXI Rule 90 of Code of Civil Procedure to set aside the sale conducted on 01.04.2019 and sale confirmed on 03.06.2019.
3. Yaragani Yagaiah filed the present Civil Revision Petition stating that the trial Court rejected the application filed to set aside auction sale dt.01.04.2019 in E.P. No.83 of 2015 and confirming the same on 03.06.2019, without registering the same at the threshold i.e. at SR stage and it amounts to non-application of the mind and leads to miscarriage of 2 PSS,J CRP No.1080 of 2020 justice caused by virtue of auction sale dt.01.04.2019 which was confirmed on 03.06.2019. The trial Court failed to observe that first respondent bank after obtaining the decree, filed E.P. During pendency of E.P., the Bank offered one time settlement for Rs.4,00,000/-, out of which one of the Judgment Debtors paid Rs.1,00,000/- but his property was sold without notice to judgment debtors.
3.1 He further stated that as per Order XXI Rule 64 of Code of Civil Procedure, the Executing Court should sell only such property or a portion thereof as necessary to satisfy the decree and this is obligatory and not just discretion of the Court. But the trial Court sold joint family property to an extent of Ac.13-29 gts., which is a fertile land under Sree Ram Sagar Project water and it was being sold at Rs.20,00,000/- to Rs.25,00,000/- per acre and the total value of the property would be more than Rs.2,50,00,000/- and a small portion of less than an acre would have been sufficient to satisfy the balance of the entire decretal amount. He also stated that there are two different schedule (Schedule 2 & 3) properties in the E.P. in different survey numbers in two different villages as per the pattedar passbooks and Adangals. The principal debtor Yaragani Venkatanarsaiah is having Ac.4-00 gts., in Tummalapenpahad village as shown in Schedule-I and also evident from the pattedar passbooks and Adangals to an extent of Ac.1-01 gts., in schedule-III in 3 PSS,J CRP No.1080 of 2020 Nasimpeta village and the said property itself is sufficient to satisfy the entire decree in full, but the trial Court erred in selling entire property contrary to Order XXI Rule 64 of Code of Civil Procedure. His mortgaged property was undervalued and brought to sale by playing fraud in collusion between the respondents herein for huge extent of Ac.13-29 gts., when the bank came forward for one time settlement and balance was only Rs.3,00,000/- to be paid. The said property was partitioned between the present petitioner (father) and his daughter by virtue of family settlement and the principal debtor his son, who borrowed money from plaintiff bank is having only an extent of Ac.4-00 gts., and pattedar passbook was also issued under Records of Rights Act in his name about four decades back and since then he has been in possession and enjoyment of the same and the same was mortgaged to the Bank for obtaining loan for purchasing a Tractor, and that the present petitioner is only a guarantor, but the trial Court without deciding of the issues, returned all the applications at SR stage. No notices were served upon either in the suit or in the E.P. and thus, requested the Court to set aside the order.
3.2 He further stated that O.S.No. 235 of 2012 is filed by Andhra Bank Branch Manager against Yargani Venkata Narsaiah, Yargani Yagaiah and Jalagam Venkat Ramana for recovery of Rs.9,38,981/- with interest.
4 PSS,J CRP No.1080 of 2020 Defendants No.1 and 2 mortgaged their agricultural land which was in Sy.No.536 to an extent Ac.4-00 gts., situated at Tummalapahad Village, Atmakur (S) Mandal belonging to defendants No.1 and 2 and the petitioners (daughters) herein created equitable mortgage for two properties i.e. agricultural lands bearing Sy.Nos.536, 633, 533, 534, 535 total extent Ac.8-18 gts., and agricultural land bearing Sy.No.131/A/1, 133/A/1, 136/A/1 extent Ac.1-10 gts., situated at Narsimpet. Both of them availed sanctioned amount. The petitioner stated that suit was decreed in ex parte. Later, respondent No.1 filed E.P. No.83 of 2015 against defendants No.1 and 2 for recovery of decretal amount, but no notice was served to the first petitioner either in suit or in the E.P. During pendency of the matter, it was referred to Lok Adalath on 06.07.2018 for one time settlement and Rs.4,00,000/- was proposed and accepted by both the parties. He paid Rs.1,00,000/- on 16.11.2018, then the matter was adjourned for compromise and posted to 14.12.2018. Later, the Bank reported that there is no compromise and taken steps for proclamation of sale. Subsequently, on 01.04.2019 sale was conducted with upset value of Rs.25,00,000/- fixed by the Court, in which the 2nd respondent was the successful bidder for an amount of Rs.38,00,000/-, and sale was confirmed on 03.06.2019. The entire proceedings either in the suit or in the E.A. are not within the knowledge of the 1st petitioner 5 PSS,J CRP No.1080 of 2020 whose land was put to auction. After he came to know of sale held by the Court, he had filed E.A.S.Rs. to set aside the sale, to condone the delay of 141 days in filing the set aside application and to re-open the E.P. for fresh hearing, but they were returned. He further stated that:
(a) He was not served with notices either in O.S. or in the E.P.
(b) The decree-holder Bank wrongly valued the E.P. schedule property of Ac.13-29 gts., @ Rs.20,00,000/-.
(c) The field Assistant/Bailiff/Ameen of the Court grossly valued the entire property at Rs. 1 crore by mentioning that the land rate is Rs.8,00,000/- per acre.
(d) But the Court valued the property and fixed the upset price at Rs.25,00,000/-.
3.3. He further stated that he is ready to deposit the E.P. amount along with interest as ordered by the trial Court. He mainly contended that the trial Court in its auction proceedings held on 1.4.2019 did not refer the total value of the E.P. schedule property with reference to any report received from the Bailiff. The land value is Rs.1 crore, but the trial Court erred in fixing the value of the land @ Rs.25,00,000/-. Auction purchaser purchased it for Rs.38,00,000/- which is less than 1/3rd of the value of the land and the Executing Court failed to follow the mandatory provision of Order XXI, Rule 64 of Code of Civil Procedure and application filed by 6 PSS,J CRP No.1080 of 2020 him is maintainable under Order XXI Rule 90 of Code of Civil Procedure even after confirmation of the sale when the Court committed material irregularity in the process of conducting auction. 3.4 He also further stated that as per Order XXI Rule 66(2) and 54 (I-A) of Code of Civil Procedure, service of notice on the judgment- debtor is mandatory before auction of the E.P. schedule property. Thus, the sale itself is void-ab-initio and he has legal right to raise objection to the sale even after confirmation of the sale and he relied upon the decision in the case of Desh Bandhu Gupta Vs. N.L. Anand and Rajinder Singh1 3.5. He further stated that the first petitioner died on 05.01.2022 leaving behind the petitioners No.2 to 4 daughters and respondent No.3 son (defendant No.1). The daughters filed L.R. petition in IA No.2 of 2022 and injunction petition in I.A. No. 1 of 2022 and this Court after allowing L.R. petition, granted interim injunction on 22.06.2022. In which, 4th petitioner in her affidavit stated that her father gave her Ac.4-00 gts., at the time of her marriage in the year 1997 and executed a Gift (settlement) Deed on Rs.50/- Non-Judicial Stamp on 15.03.2011 and thus, their legal 1 (1994)1 SCC 131 7 PSS,J CRP No.1080 of 2020 rights are also affected. Therefore, he requested to allow the above Civil Revision Petition.
4. In the counter filed by the respondent No.2/Auction Purchaser in I.A. No. 1 of 2022, he stated that he completed his M.S. degree from Wilmington University in the State of Delaware, United States of America and he worked in CVS Healthcare as Windows Security Engineer. After completion of M.S., as he is interested in the agricultural activity, more so, in the line of poultry, he has given up his job at U.S.A. and returned to India and participated in the public auction conducted by the Executing Court at Suryapet with a fond hope that the property purchased is free from disputes and he incurred Rs.1,52,000/- towards stamp duty on the certificate of sale issued by the Executing Court and he also invested Rs.12,00,000/- towards land cleaning, laying of roads, leveling the land, putting barbed fencing around the land, development of the land, and Rs.20,00,000/- towards the purchase of the steel, Rs.10,00,000/- towards sand, cement and stones and Rs.10,00,000/- towards electricity connection and Rs.5,00,000/- to the labour and Rs.1,39,000/- towards Nala Conversion fee. Thus, he spent more than Rs.60,00,000/- in addition to Rs.38,00,000/- towards bid price. He dumped the material such as iron, sand, cement and other material for the 8 PSS,J CRP No.1080 of 2020 purpose of construction of the poultry sheds, engaged labour from other States and they are staying in the schedule mentioned property. 4.1 He further stated that he incurred huge expenditure for securing legal opinion, Engineer's Valuatin Report for the collateral security belonging to his parents and project implementation is in Mid-way. If the construction is stopped, in view of rainy season, the sand and cement will get damages and he has to pay wages to his labour. He further stated that he is a bona fide auction purchaser and purchased the properties during Court auction. He was declared as successful bidder for Rs.38,00,000/- as against Rs.24,00,000/- fixed by the Executing Court. He paid entire bid amount and certificate of sale was executed on 15.04.2019 and the Court ordered for delivery of the properties under Order XXI Rule 95 of Code of Civil Procedure on 02.08.2019 and accordingly, physical deliver was given to him after fixing the boundaries under panchanama dt.09.08.2019.
4.2 He further stated that as per the market value certificate dt.02.07.2022 issued by Sub-Registrar, Suryapet, the market value per acre of the E.P. schedule property is Rs.1,00,000/- for the period 01.08.2013 to 2021 i.e. during the period of the public auction. Basing on the market value certificate, the Executing Court fixed the upset prices 9 PSS,J CRP No.1080 of 2020 of Rs.24,00,000/- for the entire schedule of property. The entire schedule of property is not a single bit and having an access from the Donka which is located in Southern side. There is no other access to reach the lands in Sy.Nos.536, 535 and 534 except through Sy.No.533 and thus, the Executing Court put the properties in a single lot. The land in Sy.No.663 is not traceable. The land in Sy.Nos.131/A, 133/A1 and 136/A1 situated at Narsimpeta village are submerged in vagu. In the panchanama, it was stated that the said lands are not traced and hence possession was not given. He also stated that at the time of purchase of the schedule property, the EP schedule property is with full of bushes, stones and small boulders and was not cultivable land. He filed photographs of the nature of property that is sold by the Executing Court to him. After purchase of the said property, Tahsildar, Atmakur (S) Mandal vide ROR proceedings No.784/2019 dt.30.09.2019 mutated the name of the respondent as Pattedar in respect of the land purchased by the respondent No.3. The Government of Telangana also issued pattedar passbook, title deed book No.T2902091647 (Khatha No.60356) and also entered the name of respondent No.2 as pattedar of the land in Dharani Portal. 4.3 He further stated that he incurred huge expenditure for conversion of land which is not cultivable from agricultural use to non-agricultural 10 PSS,J CRP No.1080 of 2020 use and Tahsildar and Joint Sub-Registrar of Atmakur (S) vide proceedings dt.04.03.2022 issued Nala Order. He also obtained No Objection Certificate from Grampanchayat, Thummalapenpahad village vide proceedings No.01/GPTPP/2022 dt.29.04.2022. The Grampanchayat has also granted permission for construction of Poultry shed in the schedule mentioned property. The respondent No.2 applied for LT supply to Southern Power Distribution Company of T.S. Limited and paid Rs.5,34,986/- and he also paid Rs.4,82,569/- to M/s Ayyappa Electrical Works for erection of the L.T. Supply. He mortgaged the schedule mentioned property with Union Bank of India as security for repayment of Rs.6,00,000/- on 22.09.2021 under registered deed No.1202 of 2021 and subsequently the said mortgage was also redeemed on 24.02.2022.
4.4 He also stated that after delivery of the physical possession of the property, when he was cleaning the bushes and put the barbed fencing around the schedule mentioned property, the petitionerNo.1, respondent No.3 and Nelacherla Saidulu tried to interfere with his peaceful possession and enjoyment, as such, he filed O.S.No.20 of 2020 for permanent injunction and also filed I.A. No.15 of 2020 under Order XXXIX Rules 1 and 2 C.P.C. seeking for temporary injunction on 10.01.2020 and it was extended from time to time, and on 05.11.2021 11 PSS,J CRP No.1080 of 2020 extended till further orders. Petitioner No.1 and respondent No.3 are aware of the injunction orders in I.A.No.15 of 2020, but the petitioner No.1 has suppressed the same, and filed I.A. No.1 of 2022 and obtained orders behind his back.
4.5 He further stated that "A" schedule property is consisting of Ac.4- 00 gts., in Sy.No.536 situated at Thummalapenpahad village belongs to the respondent No.3, but he has not filed any application before the Executing Court to set aside the auction of "A" schedule property, and the auction of the said property became final. But, the petitioner in a mischievous manner shown the property belonging to respondent No.3 and sought for orders in I.A. No.1 of 2022. He further stated that the petitioners have no right, title and interest in "A" schedule property and as such, the petitioners are not entitled to seek any relief against the "A" schedule property and it amounts to gross abuse of process of law. He further stated that as there is communication gap between him and his earlier Counsel, he could not place the correct facts and he came to know about interim orders when the respondent No.1 Bank informed that there was no representation on his behalf and he immediately took NOC vakalat from his previous counsel and entrusted the matter to the present Counsel.
12 PSS,J CRP No.1080 of 2020 4.6 He further stated that as per Article 127 of the Limitation Act, the period of limitation to file application under Order XX1 Rule 90 of Code of Civil Procedure is 60 days from the date of sale. He also relied upon the decision in the case of AARIFABEN YUNUS BHAI & OTHERS Vs. MUKUL THAKORE BHAI AMIN & OTHERS2 in which it was observed that "Section 5 of the Limitation Act is not applicable to application under Order XXI Rule 90 of Code of Civil Procedure since there is no power to condone the delay, the petition had to be dismissed as being time barred."
4.7. He further stated that as the sale was conducted on 01.04.2019 and whereas the application under Order XXI Rule 90 was filed after closure of EP with a delay of 141 days, as such, it is barred by limitation, and thus, there is no irregularity in returning all the three applications filed by the petitioners. He enclosed all the relevant documents and also photographs of the suit schedule property along with his counter. And thus, requested the Court to vacate the interim orders passed in I.A.No.1 of 2022 in C.R.P. No.1080 of 2020.
5. This Court intends to extract the docket orders in E.P.No.83 of 2015 for the purpose of clarification.
2 Civil Appeal No.1643, 1644 of 2020 13 PSS,J CRP No.1080 of 2020 DOCKET ORDERS Dt.06.07.2018 Memo filed by decree holder counsel that parties are going to be compromised in Lok Adalath. Hence, for settlement in Lok Adalath, call on 14.07.2018.
Dt.14.07.2018 Dhr and his Counsel called absent in L/A today. Hence, no settlement effected. Hence, issue fresh sale proclamation, call on 07.08.2018.
Dt.07.08.2018 P.O. is on EL, call on 16.08.2018.
Dt.16.08.2018 Issue fresh sale proclamation and proclaim and sell by next date for filing of publication in Eenadu Telugu News Papeer of Suryapet District Edition, call on 18.09.2018.
Dt.18.09.2018 Publication filed and it is found proper. J.Dr.No.1 present and requests time for payment.
Petition filed u/s 148 CPC by D.Hr. counsel to enlarge time for conducting auction is allowed as bidders remained absent today. Hence, for sale by 12.10.2018.
Dt.12.10.2018 Bidders called absent. Hence, issue fresh sale proclamation and proclaim and sell by filing publication in Eenadu Telugu News Papeer of Suryapet District Edition, call on 15.11.2018.
14 PSS,J CRP No.1080 of 2020 Dt.15.11.2018 Publication filed by DHr counsel. He reported that JDr.No. 1 paid Rs.1,00,000/- to their Bank and hence reported to grant time for compromise. Hence, for compromise by next date or for sale of E.P. schedule property, call on 14.12.2018.
Dt.14.12.2018 P.O. is on EL, call on 21.12.2018.
Dt.21.12.2018 DHr counsel reported that no compromise is effected as JDr.No. 1 did not turn up to pay the balance amount. Hence, issue fresh sale proclamation and proclaim and sell by filing publication in Eenadu Telugu News Papeer of Suryapet District Edition, call on 29.01.2019.
Dt.29.01.2019 Petition filed u/s 148 CPC is allowed. Issue fresh sale proclamation and proclaim and sell by filing publication in Eenadu Telugu News Papeer of Suryapet District Edition, call on 01.03.2019.
Dt.01.03.2019 As per office not proclamation not made but DHr Counsel filed paper publication. Hence, issue sale proclamation on payment of process and for report by 01.04.2019 to conduct auction, call on 01.04.2019.
Dt.01.04.2019 As per rules, sale is held in respect of E.P. schedule property today in the open Court hall. DHr present. JDr is called 15 PSS,J CRP No.1080 of 2020 absent and no representation on her behalf. DHr and (6) other bidders present and participated in the auction. Proclamation was made in the village on 11.03.2019 at Thummalapenpahad and Narsimpet village. Publication in Eenadu, Suryapet District Edition is filed on 14.02.2019. For E.P. amount of Rs.12,08,940/-, upset value of Rs.25,00,000/- is fixed by the Court. DHr along with bidders i.e. total (7) bidders are present and participated in the auction proceedings. Sale held in the open Court today at 4.30 p.m. and knocked down in favour of Venna Bharath Reddy S/o Chandra Reddy R/o Kesaram village of Suryapet Mandal for Rs.38,00,000/- being the highest bidder. The E.P. amount is Rs.12,08,940/-. The 1/4th sale amount of Rs.9,50,000/- and poundage of Rs.29,220/- (total amount of Rs.9,79,220/-) which is the due amount paid by the auction purchaser towards the payment of sale amount. The DHr paid an amount of Rs.29,220/- towards poundage, which is deposited today i.e. 01.04.2019. The auction purchaser is hereby directed to pay the due amount of Rs.28,20,780/- within (15) days from this date and also to deposit sale certificate stamp amount within (15) days. Hence, call on 15.04.2019. On verification, it is found that the amount is wrongly calculated by the office as Rs.29,220/- instead of Rs.1,14,720/- hence, the correct amount of Rs.1,14,720/- towards poundage was collected from the auction purchaser along with 1/4th sale amount of Rs.9,50,000/- i.e. total of Rs.10,64,720/-, call on 15.04.2019.
Dt.15.04.2019 16 PSS,J CRP No.1080 of 2020 Sale held on 01.04.2019.
2. Knocked down in favour of V. Bharath Reddy for Rs.38,00,000/- (III party, bidder No.1).
3. 1/4th sale auction amount of Rs.9,50,000/- and poundage amount of Rs.1,14,720/- paid on 01.04.2019.
4. Remaining auction amount for Rs.28,50,000/- is paid on 15.04.2019 i.e. today.
5. An amount of Rs.1,52,000/- towards purchase of sale of stamps paid on 15.04.2019 i.e. today. For sale confirmation, call on 03.06.2019.
Dt.03.06.2019 DHr called absent. No representation. JDr No.1 present. On perusal of the record, it is found that sale was held on 01.04.2019, and it was knocked down in favour of V. Bharath Reddy for Rs.38,00,000/- (third party, bidder No.1). Out of it, 1/4th of sale auction amount of Rs.9,50,000/- and poundage amount of Rs.1,14,720/- was paid on 01.04.2019 itself. The remaining auction amount for Rs.28,50,000/- was paid on 15.04.2019 and so also an amount of Rs.1,52,000/- towards purchase of sale of stamps.
Today, the case is coming up for sale conformation. No claim petitions filed and pending. As the stipulated period of 60 days is completed, sale is confirmed today. Full satisfaction is recorded and E.P. is terminated. Issue cheque for Rs.1,52,000/- in favour of treasury for purchase of non- judicial stamps. Issue sale certificate and the same may be sent to Sub-Registrar for registration.
17 PSS,J CRP No.1080 of 2020
6. In fact, claim is filed under Order XXI Rule 64 of Code of Civil Procedure in which judgment-debtors No.1 and 2 remained ex parte. As per the above orders, the Judgment-debtor No.1, who is son of petitioner/Respondent No.3 was present on 18.09.2018 and requested time for payment and also paid Rs.1,00,000/- on 15.11.2018 and later he did not turn up to pay the balance amount. As such, auction paper publication was given, sale proclamation was made, auction was conducted and it was confirmed on 03.06.2019. Even on that day, Judgment-debtor No.1 was present as per the docket order. He is son of the petitioner and advocate. Therefore, the argument of present petitioner that no notice was served on him either in the suit or in the E.P., is not tenable. In fact, the suit is filed for recovery of amount basing on the mortgaged properties. Several notices were affixed at the suit properties and tom-tom was done and the receipts were filed before the Court. The petitioner herein stated that he is ready to deposit the decretal amount and requested the Court to set aside the auction. But, he never approached the Court under Order XXI Rule 89 of Code of Civil Procedure and deposited the entire amount before the auction. He mainly relied upon Order XXI Rule 64 of Code of Civil Procedure and argued that the Court instead of auctioning the portion of the property for claiming arrears of Rs.12,08,940/- and , sold the entire property. He 18 PSS,J CRP No.1080 of 2020 relied upon the report of the Bailiff. Whereas the Court considering the material submitted by the Sub-Registrar @ Rs.1,00,000/- per acre, auctioned the property by fixing upset price as Rs.25,00,000/-. Thus, the argument of the petitioner's Counsel cannot be accepted.
7. As per Order XXI Rule 92 of Code of Civil Procedure, no application is made under Rule 89, 90 or 91, as such, the sale was confirmed and sale became absolute, after confirming of sale, he filed the above applications, as such, they were returned at the threshold. Though judgment-debtors herein having knowledge about the sale of property, either they could not deposit the amount in time as per Order XXI Rule 89 of Code of Civil Procedure and filed an application to set aside the same or they could not file applications under Order XXI Rule 89, 90 or 91 before the confirmation of the sale and same became absolute. Moreover, the auction purchaser purchased the schedule property for Rs.38,00,000/- and even after purchase, he incurred huge amount for clearing the land and also for obtaining several permissions including the permission for construction of poultry. In fact, he engaged labour and also kept material on the site, but in view of the order of the Court in I.A. No.1 of 2022, which was obtained by the petitioners herein behind his back, he could not proceed with the construction. In spite of the knowledge of the fact that already injunction was granted in favour 19 PSS,J CRP No.1080 of 2020 of auction purchaser in O.S. No. 20 of 2020, the petitioners obtained restraint order in I.A. No.1 of 2022 it amounts to abuse of process of law and thus, the petitioners are liable to pay costs of Rs.10,000/- to respondent No.2/Auction Purchaser within one week from the date of this order.
8. In view of my above discussion, this Civil Revision Petition is dismissed by confirming the order of the trial Court in returning the applications. No costs.
9. Consequently, miscellaneous petitions pending if any, shall stand closed.
_________________________ SMT. P. SREE SUDHA, J DATE:02.08.2022 BDR