PETITIONER:
RAMCHANDRA SPG. & WVG. MILLS
Vs.
RESPONDENT:
BIJLI COTTON MILLS & ORS.
DATE OF JUDGMENT:
16/12/1966
BENCH:
SHELAT, J.M.
BENCH:
SHELAT, J.M.
WANCHOO, K.N.
BACHAWAT, R.S.
CITATION:
1967 AIR 1344 1967 SCR (2) 301
ACT:
Civil Procedure Code (Act 5 of 1908), ss. 2(2), 47,
O.21 R.84 and O.21 R.90–Sale of property in execution
proceedings–Sale held by executing court to be a nullity on
ground that one-fourth of purchase price not paid
immediately after auction–Order whether appealable–O.21
R.90 whether applicable.
HEADNOTE:
The appellant’s factory was sold by auction in
execution of a decree and was purchased by the respondents.
The appellant challenged the sale on the allegation that
one-fourth of the sale-proceeds was not paid to the Amin
immediately after the auction and thus 0. 21 R. 84 had not
been complied with. The evidence produced by the
respondents showed that they had paid the required amount to
the Amin after the latter had consulted the Munsif on the
same day. The Civil Judge disbelieving the respondents’
version held the sale to be a nullity and ordered a re-sale.
The High Court however decided in favour of the respondents
and rejected the appellant’s legal contentions that (i) the
order of the Civil Judge being interlocutory was not
appealable and (ii) that 0. 21 R. 90 was not applicable. On
appeal by Special Leave to this Court,
HELD : (i) The sale had been declared to be a nullity and
there was thus no question of material irregularity having
been committed. 0. 21 R. 91 therefore did not apply. [304 A]
(ii) The order of the Civil Judge however finally determined
the question whether the sale was a nullity. After that no
question was left to be decided as between the judgment-
debtor and the auction purchaser. The order was therefore
not an interlocutory order but a final order determining the
rights of the parties. It fell within the definition of a
decree under s. 2(2) read with s. 47 of the Code of Civil
Procedure and was appealable under s. 96 of the Code. [307
G; 305 A]
Case law considered.
Mrs. Peliti v. Kanshi Gopal, A.I.R. 1939 Lah. 210,
disapproved.
Manilal Mohanlal Shah & Ors. v. Sardar Sayed Ahmed Sayed
Mohamad & Anr. [1955] 1 S.C.R. 108 and Jethanand & Sons v.
State of Uttar Pradesh, A.I.R. 1961 S.C. 794, followed.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 877 of 1964.
Appeal by special leave from the judgment and order dated
May 9, 1963 of the Allahabad High Court in Execution First
Appeal No. 410 of 1962.
Ravinder Narain, for the appellant.
J. P. Goyal and E. C. Agarwala, for respondents Nos. 1 and
2.
The Judgment of the Court was delivered by
Shelat, J. This appeal by special leave raises the question
whether an order,by an executing Court setting aside an
auction sale as a nullity is an appealable order
302
In pursuance of a decree passed against the appellant (judg-
ment debtor) the judgment creditor took out execution
proceedings. An auction sale of the factory belonging to
the appellant was ordered by the executing court. In
pursuance of that order the Amin (the auction officer) held
an auction sale on September 10, 1962. Respondent No. 1 was
held to be the highest bidder for Rs. 2,45,000/-. The
appellant challenged the auction sale alleging that the Amin
had not realised 1/4th of the sale proceeds immediately
after the said auction was closed as required by 0.21 R. 84
of the Code of Civil Procedure. His case was that the Amin
realised the said amount and deposited it in the Treasury on
,September 11, 1962. The appellant thereafter filed an
application under O. 21 R. 84 before the Civil Judge,
Aligarh. Respondent No. 1 contested that application stating
that he had , tendered the said amount immediately after the
auction, that the said amount being large the Amin hesitated
to accept it in cash as it was too late that day to .deposit
it in the Treasury. He also alleged that the Amin wanted
,to know whether he could accept a cheque instead of cash
and therefore took Chhotelal, his representative, along with
him to the residence of the Munsif, Hathras, to take
directions. Leaving Chhotelal in the car outside the
Munsif’s residence, the Amin went in to consult the Munsif
if he could accept a cheque but the Munsif advised him to
take cash. Thereafter the Amin returned to the car where he
accepted the said amount from Chhotelal and issued there and
then a receipt therefor. The respondent’s .case therefore
was that he offered the amount immediately, that is was no
fault of his that the Amin did not then accept it, and that
it was paid in any event soon after the auction and
therefore payment was in consonance with 0. 21 R. 84.
The Civil Judge refused to accept the case of respondent No.
1 ,and setting aside the auction sale held it to be a
nullity. He rejected the report of the Amin that he had
accepted the money immediately after seeing the Munsif
outside the Munsif’s house where Chhotelal was in the car.
The Civil Judge thought that the Munsif’s evidence did not
support the Amin as the Munsif had stated that it was only
the Amin who had come to see him. Therefore the evidence of
the Amin and Chhotelal that the amount of Rs. 61,250/- was
paid in the car outside the Munsif’s house was not free from
doubt. What impressed the Civil Judge was the fact that in
his report dated September 10, 1962 the Amin had not
mentioned the fact of his having received the said amount
and the receipt issued by him that day. There was however
an endorsement at the foot of that report made on September
11, 1962 in which the Amin had mentioned the fact of his
having received the said amount and the receipt having been
issued by him on September 10, 1962. The Civil Judge,
however, felt that if he had received that
303
amount on September 10, 1962, the Amin was bound to have
mentioned that fact in the body of that report that very
day, that is, on the 10th and that therefore the endorsement
was written out as an afterthought to support Chhotelal’s
evidence. Apart from the evidence of the Amin, the Munsif
and Chhotelal, there was also the evidence that respondent
No. 1 had that day withdrawn Rs.1,51,000 from the Bank and
had available with him cash and there was no reason why he
should not have paid Rs. 61,250 from that amount that very
day.
Respondent No. 1 filed an appeal against the said order in
the High Court. The High Court accepted the Amin’s report
and his evidence and reversed the judgment and order of the
Civil Judge holding that there was no breach of 0. 21 R. 84
and that the sale therefore could not be set aside as a
nullity. The High Court held-and rightly, that there was no
contradiction between the Munsif’s evidence and that of the
Amin. For, if Chhotelal was waiting in the car outside the
Munsif’s house the Munsif was not likely to see him and
would naturally depose that the Amin alone had come to his
house for consulting him. The High Court also rightly held
that there was no valid reason to doubt the Amin’s report,
the said receipt and the evidence that sufficient cash was
available with respondent No. 1 from which he had no reason
not to pay the amount of Rs. 61, 250 immediately after the
auction and that though some time elapsed after the auction
as the Amin went to consult the Munsif the said amount was
paid in accordance with 0. 21 R. 84.
Counsel for the appellant tried to challenge this finding of
fact by the High Court but as the evidence on this question
was clear and the High Court’s finding was fully justified
we, in our discretion under Art. 136 declined to permit him
to go into the evidence with a view to reopen the said
finding.
The only question which the appellant’s Counsel then raised
was that the order of the Civil Judge was made under 0. 21
R. 84, and that order was not a final but an interlocutory
order. It did not conclude the execution proceedings but
only ordered a fresh auction sale therefore no appeal Jay
before the High Court. He also contended that the sale
being contrary to 0. 21 R. 84, it was a nullity and
therefore 0. 21 R. 90 did not apply. Hence there could be
no appeal against the said order. These very contentions
were raised before the High Court but they were rejected on
the ground that the appellant’s application could not be
under 0. 21 R. 84 and that therefore the application was
under R. 90 of that order, that is, that it was an objection
to a material irregularity in the conduct and publication of
the said sale. The High Court also held that such an
objection related to execution of the decree and therefore
would fall under section 47 of the Code and an appeal lay
against such an order.
304
In Manilal Mohanlal Shah & Ors. v. Sardar Sayed Ahmed Saiyed
Mohammed & Anr.(1) this Court has held that Rules 84 and 85
of Order XXI being mandatory if they are not complied with
there would be no sale at all and the court is bound to
order a resale. That decision also held that since there
would be no sale and the imported sale is nullity there
would be no question of a material irregularity in the
conduct of the sale and R. 90 would therefore not apply. An
application under R. 90 as held by the High Court therefore
would not lie.
The question then is whether section 47 of the Code would
apply. It has been consistently held in a number of
decisions by the Privy Council and the High Courts that
section 47 is wide and should be liberally construed so as
not to drive the parties to a separate suit and thereby
prolong litigation. All questions relating to the
execution, discharge or satisfaction of the decree which
arise between the parties fall within the scope of this
section. The Explanation added to the section in 1956
includes a purchaser at a sale in execution of the decree as
a party to the suit. Consistently with the decisions giving
a libreral interpretation to this section it has been held
that an order setting aside an auction sale for non-payment
of deposit as provided by R. 85 of O. 21 falls under section
47 irrespective of whether the purchaser is a decree-holder
or a stranger. (See Nandlal v. Siddiquan) 2 The High Court
of Madras has also held that where an auction purchaser has
deposited the balance amount under R. 85 but has failed to
lodge a receipt therefor and the court orders re-sale, an
application for review of such an order falls under section
47 and such an order is appealable. (Veerayya v. Tirichi-
rapalli District Board)3. Various High Courts have
similarly held that when a sale in execution of a decree
whose validity is not questioned is attacked on the ground
that it is not merely irregular but illegal and void that
must be done by a proceeding under section 47 and not by an
independent suit. [See cases collected in Mulla's C.P.C.
13th ed. Vol. 1 p. 236, footnote (i) ]. If the order
setting aside the sale on the ground that the deposit as
provided for under R. 85 was not made falls within the scope
of section 47 there does not appear to be any reason why an
order holding the sale to be a nullity on the ground that R.
84 was not complied with cannot also fall under that
section.
Under section 2(2) of the Code a decree is deemed to include
the determination of any question falling within section 47.
An execution proceeding no doubt is not a suit but the
combined effect of section 2(2) and section 47 is that an
order passed in execution proceeding is tantamount to a
decree in so far as regards the court
(1) [1955] 1 S.C.R. 108
(2)A.I.R. 1957 All’-558-
(3) A.I.R. 1961-Mad.409.
305
passing it is conclusively determines the question arising
between the parties to the suit (which expression now
includes an auction purchaser) and relating to the execution
of the decree. Therefore if an order decides a question
relating to the rights and liabilities of the parties with
reference to the relief granted by the decree it would fall
under section 47 and would be a decree within the meaning of
section 2(2). If such an order is a decree it is appealable
under section 96 of the Code.
Reliance was placed on the judgment of the High Court of
Bombay in Manilal Mohanlal Shah v. Sardar Sayed Ahmed Sayed
Mohamed(1), (from which the appeal came up before this
Court),(2) where the High Court took the view that since it
is the duty of an executing court to order re-sale where
conditions of R. 84 are not complied with even though the
Rule does not expressly provide for an application, if the
Court sets aside the sale upon an application made to it it
can be said to have acted suo moto and the order therefore
would be under R. 84. It is however not necessary for us to
decide whether it is so or not, for, the only question
before us is whether such an order amounts to a decree and
is therefore appealable. Counsel for the appellant then
relied upon Mrs. Peliti v. Kanshi Gopal(3) where it was
held that such an order was not appealable on the ground (1)
that an auction purchaser even if he is not a stanger is not
a party to the suit and (2) that such an order setting aside
an auction sale would not be one relating to the execution,
discharge or satisfaction of the decree and therefore not an
order under section 47. The first ground no longer survives
in view of the Explanation added to section 47. It
therefore remains to be seen whether the second ground is a
valid ground. In Bharat National Bank v. Bhagwan Singh(4)
the judgment-debtor raised three contentions: (1) with
regard to his objection to the proclamation of sale, (2) the
jurisdiction of the executing court and (3) limitation. The
Division Bench which heard them upheld the first contention
holding that his objection to the proclamation was valid and
therefore ordered a fresh sale but rejected his other two
objections. In an application for leave to appeal to the
Privy Council heard by a Fall Bench of that High Court, the
judgment-debtor contended that he was entitled to leave on
the ground that though the first part of the order did not
finally determine the rights of the parties the High Court’s
decision on the rest of his other two contentions amounted
to a decree. The Full Bench by a majority decision
disallowed the application on the ground that there was no
final determination of the execution proceedings as the High
Court had ordered a resale and even if the order in regard
to the contentions as to jurisdiction and limitation were to
be considered to be a final determination the judgment of
the High Court could not be divided
2,1.2
(1) 57 Bombay Law Reporter 10.
(3) A.I.R. 1939 Lah. 210.
Ml Sup. C. 1.167-6
(2) [1955] 1.S.C.R 108
(4) A.I.R. 1943 Lah. 210.
306
into parts. The question whether ordering a fresh sale
would be a final determination if raised by an auction
purchaser was not before the High Court. As regards the
judgment-debtor the order obviously was not a final
determination as the execution proceedings were not finally
concluded. The decision in Md. Zakaria v. Kishun(1) relied
on by Counsel for the appellant laid down two propositions:
(1) that an order under R. 66 of 0.21 was not an appealable
order and (2) that the only orders which are appealable are
those which determine the rights of the parties to the
execution.
There can be no objection to these propositions. But this
decision has no bearing on the contention raised before us
and can therefore be of no assistance. Mohit Narain Jha v.
Thakan Jha(2). is again a case of an order passed under 0.21
R. 66 refusing to notify a certain lease in the proclamation
of sale. There being no determination of the rights of the
parties and the order at best being a processual one the
High Court was right in holding that such an order was
neither a decree nor appealable. The decision in Radhe Lal
v. Ladli Persad(3) which the Counsel referred to does not
also assist him but lays down on the contrary that where a
plea which is overruled is the subject of a separate
petition under section 4 and it is a self contained plea
with no reference to the other matters in dispute the order
over ruling such a plea is final as regards that particular
objection raised by the judgment-debtor and is appealable.
In Pankaj Kumar v. Nanibala(4) the High Court was concerned
with the question whether the order in question was a final
order under Art. 133 of the Constitution. The order against
which an appeal to this. Court was sought for was one
dismissing certain objections raised by the judgment-debtor.
The order did not dispose of the execution proceedings in
which it was raised and on that ground the High Court held
that no appeal lay before this Court and refused to issue
the certificate. Thus, except for the decision in Mrs. J.
Peliti v. Kanshi Gopal(5) none of the decisions relied on by
Counsel relates to the question before us and therefore they
are not of any assistance.
As to what is a final order was stated by this Court in
Jethanand & Sons v. State of Uttar Pradesh(6) in the
following terms:
“An order is final if it amounts to a final
decision relating to the rights of the parties
in dispute in the civil proceeding. If after
the order the civil proceeding still remains
to be tried and the rights in dispute between
the parties had to be determined, the order is
not a final order within the meaning of Art.
133.”
.lm0
(1) A.I.R. 1926 All. 268. (2) I.L.R. 4 Pat.
731.
(3) A.I.R. 1957 Punjab 92. (4) A.I.R. 1963, Cal.
524.
(5) A.I.R. 1939 Lah. 210. (6) A.I.R. 1961 S.C. 794.
307
Similarly in Abdul Rahman v. D. K. Cassim(1) Sir George
Lowndes observed:
“The finality must be finality in relation to
the suit. If after the order the suit is
still alive in which rights of the parties
have still to be determined no appeal lies
against it. The fact that the order decides
an important and even a vital issue is by
itself not material. If the decision on an
issue puts an end to the suit, the order will
undoubtedly be a final one.”
In deciding the question whether the order is a final order
determining the rights of parties and therfore falling
within the definition of a decree in section 2(2), it would
often become necessary to view it from the point of view of
both the parties in the present case-the judgment debtor and
the auction-purchaser. So far as the judgment-debtor is
concerned the order obviously’ does not finally decide his
rights since a fresh sale is ordered. The position,
however, of the auction purchaser is different. When an
auction-purchaser is declared to be the highest bidder and
the auction is declared have been concluded certain rights
accrue to him and he becomes entitled to conveyance of the
property through the court on his paying the balance unless
the sale is not confirmed by the Court. Where an
application is made to set aside the auction sale as a
nullity, if the court sets it aside either by an order on
such an application or suo moto the only question arising in
such a case as between him and the judgment debtor is
whether the auction was a nullity by reason of any violation
of 0. 21 R. 84 or other similar mandatory provisions. If
the court sets aside the auction sale there is an end of the
matter and no further question remains to be decided so far
as he and the judgment-debtor are concerned. Even though a
resale in such a case is ordered such an order cannot be
said to be an interlocutory order as the entire matter is
finally disposed, of. It is thus manifest that the order
setting aside the auction sale amounts to a final decision
relating to the rights of the parties in dispute in that
particular civil proceeding, such a proceeding being one in
which the rights and liabilities of the parties arising from
the auction sale are in dispute and wherein they are finally
determined by the court passing the order setting it aside.
The parties in such a case are only the judgment-debtor and
the auctionpurchaser, the only issue between them for
determination being whether the auction sale is liable to be
set aside. There is an end of that matter when the court
passes the order and that order is final as it finally
determines the rights and liabilities of the parties, viz.,
the judgment-debtor and the auction-purchaser in regard to
that sale, as after that order nothing remains to be
determined as between them.
(1) 63 I.A. 76.
308
An auction sale is held in pursuance of execution
proceedings taken out by the judgment-creditor and the order
passed by the executing court. Until the decree is
satisfied or discharged the execution proceedings cannot be
said to have been completed. It is by the payment of sale
proceeds resulting from such sale that the decree is
satisfied either in part or in whole. That being clearly
the position it is difficult to comprehend as to why as held
in Mrs. J..Peliti v. Kanshi Gopal(1) an order declaring an
auction sale as a nullity cannot be said to be one relating
to the execution discharge or satisfaction of the decree
within the meaning of section 47.
In our view the order in question was a final order
determining the rights of the parties and therefore fell
within the definition of a decree under section 2(2) read
with section 47 and was therefore an appealable order. The
appeal therefore lay before the High Court. The contentions
raised on behalf of the appellant therefore must be
rejected.
The appeal is dismissed with costs.
G.C. Appeal dismissed.
(1) A.I.R. 1939 Lah. 210.
309
RAMCHANDRA SPG. & WVG. MILLS
Vs.
RESPONDENT:
BIJLI COTTON MILLS & ORS.
DATE OF JUDGMENT:
16/12/1966
BENCH:
SHELAT, J.M.
BENCH:
SHELAT, J.M.
WANCHOO, K.N.
BACHAWAT, R.S.
CITATION:
1967 AIR 1344 1967 SCR (2) 301
ACT:
Civil Procedure Code (Act 5 of 1908), ss. 2(2), 47,
O.21 R.84 and O.21 R.90–Sale of property in execution
proceedings–Sale held by executing court to be a nullity on
ground that one-fourth of purchase price not paid
immediately after auction–Order whether appealable–O.21
R.90 whether applicable.
HEADNOTE:
The appellant’s factory was sold by auction in
execution of a decree and was purchased by the respondents.
The appellant challenged the sale on the allegation that
one-fourth of the sale-proceeds was not paid to the Amin
immediately after the auction and thus 0. 21 R. 84 had not
been complied with. The evidence produced by the
respondents showed that they had paid the required amount to
the Amin after the latter had consulted the Munsif on the
same day. The Civil Judge disbelieving the respondents’
version held the sale to be a nullity and ordered a re-sale.
The High Court however decided in favour of the respondents
and rejected the appellant’s legal contentions that (i) the
order of the Civil Judge being interlocutory was not
appealable and (ii) that 0. 21 R. 90 was not applicable. On
appeal by Special Leave to this Court,
HELD : (i) The sale had been declared to be a nullity and
there was thus no question of material irregularity having
been committed. 0. 21 R. 91 therefore did not apply. [304 A]
(ii) The order of the Civil Judge however finally determined
the question whether the sale was a nullity. After that no
question was left to be decided as between the judgment-
debtor and the auction purchaser. The order was therefore
not an interlocutory order but a final order determining the
rights of the parties. It fell within the definition of a
decree under s. 2(2) read with s. 47 of the Code of Civil
Procedure and was appealable under s. 96 of the Code. [307
G; 305 A]
Case law considered.
Mrs. Peliti v. Kanshi Gopal, A.I.R. 1939 Lah. 210,
disapproved.
Manilal Mohanlal Shah & Ors. v. Sardar Sayed Ahmed Sayed
Mohamad & Anr. [1955] 1 S.C.R. 108 and Jethanand & Sons v.
State of Uttar Pradesh, A.I.R. 1961 S.C. 794, followed.
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 877 of 1964.
Appeal by special leave from the judgment and order dated
May 9, 1963 of the Allahabad High Court in Execution First
Appeal No. 410 of 1962.
Ravinder Narain, for the appellant.
J. P. Goyal and E. C. Agarwala, for respondents Nos. 1 and
2.
The Judgment of the Court was delivered by
Shelat, J. This appeal by special leave raises the question
whether an order,by an executing Court setting aside an
auction sale as a nullity is an appealable order
302
In pursuance of a decree passed against the appellant (judg-
ment debtor) the judgment creditor took out execution
proceedings. An auction sale of the factory belonging to
the appellant was ordered by the executing court. In
pursuance of that order the Amin (the auction officer) held
an auction sale on September 10, 1962. Respondent No. 1 was
held to be the highest bidder for Rs. 2,45,000/-. The
appellant challenged the auction sale alleging that the Amin
had not realised 1/4th of the sale proceeds immediately
after the said auction was closed as required by 0.21 R. 84
of the Code of Civil Procedure. His case was that the Amin
realised the said amount and deposited it in the Treasury on
,September 11, 1962. The appellant thereafter filed an
application under O. 21 R. 84 before the Civil Judge,
Aligarh. Respondent No. 1 contested that application stating
that he had , tendered the said amount immediately after the
auction, that the said amount being large the Amin hesitated
to accept it in cash as it was too late that day to .deposit
it in the Treasury. He also alleged that the Amin wanted
,to know whether he could accept a cheque instead of cash
and therefore took Chhotelal, his representative, along with
him to the residence of the Munsif, Hathras, to take
directions. Leaving Chhotelal in the car outside the
Munsif’s residence, the Amin went in to consult the Munsif
if he could accept a cheque but the Munsif advised him to
take cash. Thereafter the Amin returned to the car where he
accepted the said amount from Chhotelal and issued there and
then a receipt therefor. The respondent’s .case therefore
was that he offered the amount immediately, that is was no
fault of his that the Amin did not then accept it, and that
it was paid in any event soon after the auction and
therefore payment was in consonance with 0. 21 R. 84.
The Civil Judge refused to accept the case of respondent No.
1 ,and setting aside the auction sale held it to be a
nullity. He rejected the report of the Amin that he had
accepted the money immediately after seeing the Munsif
outside the Munsif’s house where Chhotelal was in the car.
The Civil Judge thought that the Munsif’s evidence did not
support the Amin as the Munsif had stated that it was only
the Amin who had come to see him. Therefore the evidence of
the Amin and Chhotelal that the amount of Rs. 61,250/- was
paid in the car outside the Munsif’s house was not free from
doubt. What impressed the Civil Judge was the fact that in
his report dated September 10, 1962 the Amin had not
mentioned the fact of his having received the said amount
and the receipt issued by him that day. There was however
an endorsement at the foot of that report made on September
11, 1962 in which the Amin had mentioned the fact of his
having received the said amount and the receipt having been
issued by him on September 10, 1962. The Civil Judge,
however, felt that if he had received that
303
amount on September 10, 1962, the Amin was bound to have
mentioned that fact in the body of that report that very
day, that is, on the 10th and that therefore the endorsement
was written out as an afterthought to support Chhotelal’s
evidence. Apart from the evidence of the Amin, the Munsif
and Chhotelal, there was also the evidence that respondent
No. 1 had that day withdrawn Rs.1,51,000 from the Bank and
had available with him cash and there was no reason why he
should not have paid Rs. 61,250 from that amount that very
day.
Respondent No. 1 filed an appeal against the said order in
the High Court. The High Court accepted the Amin’s report
and his evidence and reversed the judgment and order of the
Civil Judge holding that there was no breach of 0. 21 R. 84
and that the sale therefore could not be set aside as a
nullity. The High Court held-and rightly, that there was no
contradiction between the Munsif’s evidence and that of the
Amin. For, if Chhotelal was waiting in the car outside the
Munsif’s house the Munsif was not likely to see him and
would naturally depose that the Amin alone had come to his
house for consulting him. The High Court also rightly held
that there was no valid reason to doubt the Amin’s report,
the said receipt and the evidence that sufficient cash was
available with respondent No. 1 from which he had no reason
not to pay the amount of Rs. 61, 250 immediately after the
auction and that though some time elapsed after the auction
as the Amin went to consult the Munsif the said amount was
paid in accordance with 0. 21 R. 84.
Counsel for the appellant tried to challenge this finding of
fact by the High Court but as the evidence on this question
was clear and the High Court’s finding was fully justified
we, in our discretion under Art. 136 declined to permit him
to go into the evidence with a view to reopen the said
finding.
The only question which the appellant’s Counsel then raised
was that the order of the Civil Judge was made under 0. 21
R. 84, and that order was not a final but an interlocutory
order. It did not conclude the execution proceedings but
only ordered a fresh auction sale therefore no appeal Jay
before the High Court. He also contended that the sale
being contrary to 0. 21 R. 84, it was a nullity and
therefore 0. 21 R. 90 did not apply. Hence there could be
no appeal against the said order. These very contentions
were raised before the High Court but they were rejected on
the ground that the appellant’s application could not be
under 0. 21 R. 84 and that therefore the application was
under R. 90 of that order, that is, that it was an objection
to a material irregularity in the conduct and publication of
the said sale. The High Court also held that such an
objection related to execution of the decree and therefore
would fall under section 47 of the Code and an appeal lay
against such an order.
304
In Manilal Mohanlal Shah & Ors. v. Sardar Sayed Ahmed Saiyed
Mohammed & Anr.(1) this Court has held that Rules 84 and 85
of Order XXI being mandatory if they are not complied with
there would be no sale at all and the court is bound to
order a resale. That decision also held that since there
would be no sale and the imported sale is nullity there
would be no question of a material irregularity in the
conduct of the sale and R. 90 would therefore not apply. An
application under R. 90 as held by the High Court therefore
would not lie.
The question then is whether section 47 of the Code would
apply. It has been consistently held in a number of
decisions by the Privy Council and the High Courts that
section 47 is wide and should be liberally construed so as
not to drive the parties to a separate suit and thereby
prolong litigation. All questions relating to the
execution, discharge or satisfaction of the decree which
arise between the parties fall within the scope of this
section. The Explanation added to the section in 1956
includes a purchaser at a sale in execution of the decree as
a party to the suit. Consistently with the decisions giving
a libreral interpretation to this section it has been held
that an order setting aside an auction sale for non-payment
of deposit as provided by R. 85 of O. 21 falls under section
47 irrespective of whether the purchaser is a decree-holder
or a stranger. (See Nandlal v. Siddiquan) 2 The High Court
of Madras has also held that where an auction purchaser has
deposited the balance amount under R. 85 but has failed to
lodge a receipt therefor and the court orders re-sale, an
application for review of such an order falls under section
47 and such an order is appealable. (Veerayya v. Tirichi-
rapalli District Board)3. Various High Courts have
similarly held that when a sale in execution of a decree
whose validity is not questioned is attacked on the ground
that it is not merely irregular but illegal and void that
must be done by a proceeding under section 47 and not by an
independent suit. [See cases collected in Mulla's C.P.C.
13th ed. Vol. 1 p. 236, footnote (i) ]. If the order
setting aside the sale on the ground that the deposit as
provided for under R. 85 was not made falls within the scope
of section 47 there does not appear to be any reason why an
order holding the sale to be a nullity on the ground that R.
84 was not complied with cannot also fall under that
section.
Under section 2(2) of the Code a decree is deemed to include
the determination of any question falling within section 47.
An execution proceeding no doubt is not a suit but the
combined effect of section 2(2) and section 47 is that an
order passed in execution proceeding is tantamount to a
decree in so far as regards the court
(1) [1955] 1 S.C.R. 108
(2)A.I.R. 1957 All’-558-
(3) A.I.R. 1961-Mad.409.
305
passing it is conclusively determines the question arising
between the parties to the suit (which expression now
includes an auction purchaser) and relating to the execution
of the decree. Therefore if an order decides a question
relating to the rights and liabilities of the parties with
reference to the relief granted by the decree it would fall
under section 47 and would be a decree within the meaning of
section 2(2). If such an order is a decree it is appealable
under section 96 of the Code.
Reliance was placed on the judgment of the High Court of
Bombay in Manilal Mohanlal Shah v. Sardar Sayed Ahmed Sayed
Mohamed(1), (from which the appeal came up before this
Court),(2) where the High Court took the view that since it
is the duty of an executing court to order re-sale where
conditions of R. 84 are not complied with even though the
Rule does not expressly provide for an application, if the
Court sets aside the sale upon an application made to it it
can be said to have acted suo moto and the order therefore
would be under R. 84. It is however not necessary for us to
decide whether it is so or not, for, the only question
before us is whether such an order amounts to a decree and
is therefore appealable. Counsel for the appellant then
relied upon Mrs. Peliti v. Kanshi Gopal(3) where it was
held that such an order was not appealable on the ground (1)
that an auction purchaser even if he is not a stanger is not
a party to the suit and (2) that such an order setting aside
an auction sale would not be one relating to the execution,
discharge or satisfaction of the decree and therefore not an
order under section 47. The first ground no longer survives
in view of the Explanation added to section 47. It
therefore remains to be seen whether the second ground is a
valid ground. In Bharat National Bank v. Bhagwan Singh(4)
the judgment-debtor raised three contentions: (1) with
regard to his objection to the proclamation of sale, (2) the
jurisdiction of the executing court and (3) limitation. The
Division Bench which heard them upheld the first contention
holding that his objection to the proclamation was valid and
therefore ordered a fresh sale but rejected his other two
objections. In an application for leave to appeal to the
Privy Council heard by a Fall Bench of that High Court, the
judgment-debtor contended that he was entitled to leave on
the ground that though the first part of the order did not
finally determine the rights of the parties the High Court’s
decision on the rest of his other two contentions amounted
to a decree. The Full Bench by a majority decision
disallowed the application on the ground that there was no
final determination of the execution proceedings as the High
Court had ordered a resale and even if the order in regard
to the contentions as to jurisdiction and limitation were to
be considered to be a final determination the judgment of
the High Court could not be divided
2,1.2
(1) 57 Bombay Law Reporter 10.
(3) A.I.R. 1939 Lah. 210.
Ml Sup. C. 1.167-6
(2) [1955] 1.S.C.R 108
(4) A.I.R. 1943 Lah. 210.
306
into parts. The question whether ordering a fresh sale
would be a final determination if raised by an auction
purchaser was not before the High Court. As regards the
judgment-debtor the order obviously was not a final
determination as the execution proceedings were not finally
concluded. The decision in Md. Zakaria v. Kishun(1) relied
on by Counsel for the appellant laid down two propositions:
(1) that an order under R. 66 of 0.21 was not an appealable
order and (2) that the only orders which are appealable are
those which determine the rights of the parties to the
execution.
There can be no objection to these propositions. But this
decision has no bearing on the contention raised before us
and can therefore be of no assistance. Mohit Narain Jha v.
Thakan Jha(2). is again a case of an order passed under 0.21
R. 66 refusing to notify a certain lease in the proclamation
of sale. There being no determination of the rights of the
parties and the order at best being a processual one the
High Court was right in holding that such an order was
neither a decree nor appealable. The decision in Radhe Lal
v. Ladli Persad(3) which the Counsel referred to does not
also assist him but lays down on the contrary that where a
plea which is overruled is the subject of a separate
petition under section 4 and it is a self contained plea
with no reference to the other matters in dispute the order
over ruling such a plea is final as regards that particular
objection raised by the judgment-debtor and is appealable.
In Pankaj Kumar v. Nanibala(4) the High Court was concerned
with the question whether the order in question was a final
order under Art. 133 of the Constitution. The order against
which an appeal to this. Court was sought for was one
dismissing certain objections raised by the judgment-debtor.
The order did not dispose of the execution proceedings in
which it was raised and on that ground the High Court held
that no appeal lay before this Court and refused to issue
the certificate. Thus, except for the decision in Mrs. J.
Peliti v. Kanshi Gopal(5) none of the decisions relied on by
Counsel relates to the question before us and therefore they
are not of any assistance.
As to what is a final order was stated by this Court in
Jethanand & Sons v. State of Uttar Pradesh(6) in the
following terms:
“An order is final if it amounts to a final
decision relating to the rights of the parties
in dispute in the civil proceeding. If after
the order the civil proceeding still remains
to be tried and the rights in dispute between
the parties had to be determined, the order is
not a final order within the meaning of Art.
133.”
.lm0
(1) A.I.R. 1926 All. 268. (2) I.L.R. 4 Pat.
731.
(3) A.I.R. 1957 Punjab 92. (4) A.I.R. 1963, Cal.
524.
(5) A.I.R. 1939 Lah. 210. (6) A.I.R. 1961 S.C. 794.
307
Similarly in Abdul Rahman v. D. K. Cassim(1) Sir George
Lowndes observed:
“The finality must be finality in relation to
the suit. If after the order the suit is
still alive in which rights of the parties
have still to be determined no appeal lies
against it. The fact that the order decides
an important and even a vital issue is by
itself not material. If the decision on an
issue puts an end to the suit, the order will
undoubtedly be a final one.”
In deciding the question whether the order is a final order
determining the rights of parties and therfore falling
within the definition of a decree in section 2(2), it would
often become necessary to view it from the point of view of
both the parties in the present case-the judgment debtor and
the auction-purchaser. So far as the judgment-debtor is
concerned the order obviously’ does not finally decide his
rights since a fresh sale is ordered. The position,
however, of the auction purchaser is different. When an
auction-purchaser is declared to be the highest bidder and
the auction is declared have been concluded certain rights
accrue to him and he becomes entitled to conveyance of the
property through the court on his paying the balance unless
the sale is not confirmed by the Court. Where an
application is made to set aside the auction sale as a
nullity, if the court sets it aside either by an order on
such an application or suo moto the only question arising in
such a case as between him and the judgment debtor is
whether the auction was a nullity by reason of any violation
of 0. 21 R. 84 or other similar mandatory provisions. If
the court sets aside the auction sale there is an end of the
matter and no further question remains to be decided so far
as he and the judgment-debtor are concerned. Even though a
resale in such a case is ordered such an order cannot be
said to be an interlocutory order as the entire matter is
finally disposed, of. It is thus manifest that the order
setting aside the auction sale amounts to a final decision
relating to the rights of the parties in dispute in that
particular civil proceeding, such a proceeding being one in
which the rights and liabilities of the parties arising from
the auction sale are in dispute and wherein they are finally
determined by the court passing the order setting it aside.
The parties in such a case are only the judgment-debtor and
the auctionpurchaser, the only issue between them for
determination being whether the auction sale is liable to be
set aside. There is an end of that matter when the court
passes the order and that order is final as it finally
determines the rights and liabilities of the parties, viz.,
the judgment-debtor and the auction-purchaser in regard to
that sale, as after that order nothing remains to be
determined as between them.
(1) 63 I.A. 76.
308
An auction sale is held in pursuance of execution
proceedings taken out by the judgment-creditor and the order
passed by the executing court. Until the decree is
satisfied or discharged the execution proceedings cannot be
said to have been completed. It is by the payment of sale
proceeds resulting from such sale that the decree is
satisfied either in part or in whole. That being clearly
the position it is difficult to comprehend as to why as held
in Mrs. J..Peliti v. Kanshi Gopal(1) an order declaring an
auction sale as a nullity cannot be said to be one relating
to the execution discharge or satisfaction of the decree
within the meaning of section 47.
In our view the order in question was a final order
determining the rights of the parties and therefore fell
within the definition of a decree under section 2(2) read
with section 47 and was therefore an appealable order. The
appeal therefore lay before the High Court. The contentions
raised on behalf of the appellant therefore must be
rejected.
The appeal is dismissed with costs.
G.C. Appeal dismissed.
(1) A.I.R. 1939 Lah. 210.
309