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Supreme Court of India

DESH BANDHU GUPTAversusN L. ANAND AND RAJINDER SINGH

Citation
1993 INSC 301
Decided
17 September 1993
Disposal
Appeal(s) allowed

Holding

A sale in execution is void where the court neglects mandatory procedural steps—especially serving notice on the judgment debtor and applying its mind to the extent of property to be sold—resulting in material irregularity and substantial injury, and must be set aside under Section 47 CPC and Order 21 Rule 90.

Summary

The appellant, a tenant, had deposited rent exceeding the decretal amount before execution proceedings were initiated. The execution court, without serving any notice to the judgment debtor, sold his 550‑sq‑yard plot to the second respondent for Rs 1,05,000, despite the decree debt being only Rs 7,780.33 and the property’s market value being far higher. The Supreme Court held that the execution court failed to comply with mandatory procedural requirements under Order 21 (notice under Rules 54(1A) and 66(2), consideration of objections under Rule 23(2), and proper determination of the extent of property to be sold), amounting to a material irregularity that caused substantial injury. Consequently, the sale and its confirmation were set aside under Section 47 CPC and Order 21 Rule 90, and the parties were directed to restore the monies. The appeal was allowed.

Issues considered

  • Whether the execution court had jurisdiction to sell a property whose value exceeded the pecuniary limit of Rs 25,000 under Order 21 Rule 10.
  • Whether service of notice on the judgment debtor under Order 21 Rule 66(2) and Rule 54(1A) is mandatory and its omission renders the sale void.
  • Whether failure to consider objections under Order 21 Rule 23(2) is appealable.
  • Whether selling the entire property when only a portion is needed to satisfy the decree constitutes a material irregularity.
  • Whether all joint purchasers must be impleaded as respondents in a sale proceeding.
  • Whether the sale can be set aside under Section 47 CPC and Order 21 Rule 90 for material irregularities causing substantial injury.

Legislation cited

  • Code of Civil Procedure, 1908s. Order 21 Rule 10, s. Order 21 Rule 1(1), s. Order 21 Rule 22, s. Order 21 Rule 23(2), s. Order 21 Rule 54(1A), s. Order 21 Rule 64, s. Order 21 Rule 66(2), s. Order 21 Rule 66(3), s. Order 21 Rule 66(4), s. Order 21 Rule 66(5), s. Order 21 Rule 67, s. Order 21 Rule 90, s. Order 21 Rule 90(3), s. Section 47

Subjects

execution of decreesale of immovable propertynotice requirementmaterial irregularityjurisdictionSection 47 CPCOrder 21 Rule 90auction purchaserdecree holderjudgment debtorCivil Procedure Code

Judgment

A                          DESH BANDHU GUPTA
                                   v.
                     N L. ANANp AND RAJINDER SINGH

                              SEPTEMBER 17, 1993

·B                 [K. RAMASWAMY AND R.M. SAHAI, JJ.]

        Civil Procedure Code, 1908: Order 21 Rules 66, 67 and 54 (1-A)---Sale
  of property in satisfaction of Court decree-Service of notice on judgment-
  debtor mandatory-Sale proclamation-Furnishing relevant and material par-
C ticulars-Need for---Court to apply its mind-Obligation of Court to state
  valuation given by both the parties-In the absence of notice failure on the
  part of judgment-Debtor would not preclude him from raising objections after
  sale.

           Section 47, Order 21 Rules 90, 17 (4), 64, 66 (2) and Appendix E, Fann
D    27-Extent of property to be sold in execution-Should be only to such an
     extent as to satisfy the decree Court to apply its mind-Non-application of
     mind a material irregularity-Would vitiate sale-But not mere irregularity.

           Order 21 Rules 1 (1) and 23 (2)-Mode of payment of decretal
E money-Arrears of rent deposited by tenant-Decretal amount not
     deposited-Executing Court could direct the withdrawal of rent and deposit
     the same towards decretal amount-Or consider tenant's objection and pass
     an order under Rule 23 (2)-<Jmission to consider objections raised by
     judgment debto~Whether appealable.

F          Order 21 Rule JO-Jurisdiction of Executing Court-Value of property
     sold at the execution-Not detenninative of-Where decree in execution is
     within its jurisdiction-Executing Court has jurisdiction.

           Section 47-0rder 21 Rule 90-Application for setting aside execution
G sale-Necessary parties-Who are-lmpleading all joint purchasers-Whether
     necessary.

            Appellant judgment-debtor was a tenant. The landlady applied for
     bis eviction for default in payment of rent. She sold the property to the
     first respondent who got himself impleaded in the eviction proceedings and
H    also independently sought eviction of the appellant. During the pendency
                                         346
                            D.B. GUPTA v. N.L. ANAND                         347

     of the proceedings appellant deposited rent to the extent of Rs. 13,440 in     A
     the name of the landlady. The decree for eviction made against the tenant
     was confirmed by this Court. The suit of the first respondent for the
     arrears of rent was decreed for a sum of Rs. 6,419.98.

           Appellant filed a Writ Petition and the High Court directed that the
     amount deposited by the appellant be credited to the account of the first      B
-~
     respondent. An execution petition was filed by the first respondent for sale
     of a plot belonging to the appellant, and a warrant of attachment was
     issued. Appellant filed an objection petition claiming that since he had
     already deposited more than the decretal amount, the decree stood satis-
     fied and became inexecutable. He also challenged the jurisdiction of the       c
     Execution Court. The Court passed an order for sale of the property.
     Admittedly, the appellant was neither given notice nor was he present; nor
     was he aware of the order. Sale warrant was issued and in the imction held,
     the said plot was sold to the second respondent and his wife for a sum of
     Rs. 1,05,000.
                                                                                    D
           On coming to know of the sale, appellant filed a petition challenging
     the sale on the grounds that it was collusive and fraudulent; that the price
     was inadequate; that there was no notice issued to him and that there was
     no sale proclamation. The application was rejected and the sale was
     confirmed hy the trial court. The appeal preferred by the appellant was        E
     dismissed by the appellate court. The revision petition was dismissed in
     limine by the High Court. Hence this appeal.

           Allowing the appeal, this Court

            HELD : 1.1. Under Order 21 Rule 10 of Civil Procedure Code an F
     application for execution should be made to the court ''which passed the
     decree". Therefore, even if the value of the property sold at the execution
     is more than Rs. 25,000 it does not take away the jurisdiction of the trial
     court. Admittedly the decree in execution for Rs. 7,780.33 is within the
     jurisdiction of the trial court, which passed the decree. [345-F-G]         G

          Banwar Lal v. Smt. Prem Lata, A.I.R. (1990) S.C. 623, relied on.

            1.2. By amending rule 1(1) of Order 21 C.P.C. in 1976 a right has
     been given to the judgment-debtor to pay the decree debt either by deposit-
     ing it into the Executing Court, or sending it by other modes of payment H
    348                   SUPREME COURT REPORTS (1993) SUPP. 2 S.C.R.

A with intimation to the decree holder so that the liability to pay interest
    ceases from that date. It is an enabling provision for the benefit of'
    judgment-debtor. Though by literal construction the appellant should
    deposit ~he dccretal amount into the executing Court for claiming the
    benefit of the discharge, the decree-holder undoubtedly had knowledge of
    deposit of the amount made by the appellant. Even before execution was
B   laid, the amount was available towards satisfaction of the d.ecree. The court
    should have directed its attachment or directed the appellant to withdraw
     that amount and deposit it into the court instead of launching tardious
     process of execution by sale of immovable property. [355-B-D)

c         1.3. Had the court considered the objections and passed an order
    under Order 21 Rule 23(2), it would be incumbent upon the appellant to
    carry the order in an appeal. The omission to consider the objections is
    not appealable. Had an order been made on the objections and was allowed
    to become final, perhaps Order 21 Rules 90(3) would operate against the
    objector. So the objection would still be open to the appellant to reiterate
D   in his petition after the sale under s.47 or under Order 21 Rule 90.
                                                                      [356-D-E]
          1.4. In the proceedings under section 47 or Order 21 Rule 90, the
    decree-holder is the affected necessary party. Though the auction pur-
    chaser need to be impleaded eonominee as respondent as the property was
E   purchased jointly at the court sale, it is enough that one among them is
    impleaded as a party. It is not necessary to implead all the joint pur-
    chasers. [357-A-B)

          Banwar Lal v. Smt. Prem Lata, A.J.R. (1990) S.C. 623 and Gajadhar
F Prasad & Ors. v. Babu Bhakta Ratan & Ors., [1974) 1 S.C.R. 372, relied on.

        2. The purpose of attachment under Order 21 Rule 54 is to make the
  judgment-debtor aware that attachment has been effected and that he
  should not make any transfer or encumber the property thereafter. It is in
  the interest of the decree-holder to have the notice of attachment served
G personally on the judgment-debtor. Nevertheless the sale is not void,
  though the omission to serve the copy of the order of attachment is an
  irregularity. [357-G]

          3.1. The absence of notice causes irremedial injury to the judgment-
H debtor. Equally publication of the proclamation of sale under Order 21
                       O.B. GUPTA i•. N.L. ANAND                       349

  Rule 67 and ·specifying the date and place of sale of the property under A
  Rule 66(2) are intended so that the prospective bidders would know the
  value and could make up their mind to offer the price at sale of the
  property 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 and to convass and bring the intending bidders at the time of
 sale. It also disables him from pursuing if any fraud or irregularity has
                                                                               B
 been committed in the publication and 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 C
 decree holder. A sale· made, without notice to the judgment-debtor is
 therefore 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 salutory D
 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 prevailing in the
locality, though exaggeration may at times be possible. The 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 E
to sell his immovable property. Therefore, notice under Order 21 Rule
66(2), unless proviso is applied (if no already issued under Order 21 Rule
22), and its service is mandatory. It is made manifest by Order 21 Rule
54(1A) brought on statute by the 1976 Amendment Act. The omission
thereof renders the further action and the sale in pursuance thereof void F
unless the judgment-debtor appears without notice and thereby waives the
service of notice. [360-E-H; 361-A-E]

      3.2. In the instant case, the execution court had completely over·
looked compliance of the mandatory procedure, accepted ipsi dixit of the
decree-holder even without calling amin's report. The decree-holder in a G
complaint given to the Income-tax Department got valued the site with an
approved valuer at Rs. 3,33,333'.00 but he valued in the Execution Petition
at Rs. 1,00,000. The Court accepted it without indicating grounds for this
preference and given a programme of sale. It did not bother even to
consider the objections of the judgment-debtor that sufficient amount to H
    350                  SUPREME COURT REPORTS [1993] SUPP. 2 S.C.R.

A   meet the decree debt was already in deposit. It is a case of non-application
    of judicial mind and abdication of judicial duty. [316-F -G)

         Rajagopal Iyer v. Ramachandra Iye1; 1.L.R. (1947) Mad. 288, ap-
    proved.

B       4.1. Though the insertion of an order judicially passed need not be
  made in the sale proclamation but the record should indicate that a
  judicial order has been passed showing thl;lt the court had applied its mind
  to the neetl for determining all the essential particulars, which would
  reasonably be looked for by an intending purchaser. The relevant and
C material particulars should be inserted in the sale proclaimed as accurate-
  ly and precisely as possible. The order should show that it considered the
  objections, if any, of the decree-holders of the judgment-debtors, as the
  case may be. [361-H; 362-A, BJ

D          4.2. Order 21 Rule 54 sub-rule (lA) brought by 1976 Amendment Act
    mandates that the court should require the judgment-debtor to attend the
    court on a specified date to take notice of the court to be fixed for settling
    the terms of proclamation of sale. Form 24 of Appendix 'E' second para
    and the court rules also envisage the mandate. It is a reminder to the court
    that it has a statutory duty to issue notice to the judgment-debtor before
E   settlement of the terms of proclamation of sale. Then only the proviso to
    rule 66(2) comes into play dispensing with multiplicity of notices and not
    dispensation of mandatory compliance of notice to the judgment-debtor.
    Had it been a case where notice was served and the appellant lay by,
    without objecting to the valuation given by by the decree holder, certainly
F   that would be put against the appellant to impugned the irregnlarities
    after the sale or the under-valuation settled by the court in the proclama-
    tion of sale. [362-C-E]

          4.3. A proclamation of sale drawn casually without compliance of the
    mandatory requirement and a sale held in furtherance thereof is not a sale
G   in the eye of law. The procedure adopted by the court in non-compliance
    of Order 21 Rule 66 and 67 is in flagrant breach of the mandatory
    provision. It is a nullity ab initio. [363-A-B]

          Shalimar Cinema v. Bhasin Film Co1poratio11, A.l.R. (1987) S.C. 2081,
H   relied on.
                         D.B. GUPTA v. N.L. ANAND                            351

       5.1. Order 21Rule90 was brought on statute by 1976 Amendment Act. A
 Sub-rule(3) thereof is like a "Caveat emptor" that the judgment-debtor be
 vigilant and watchful to vindicate pre-sale illegalities or material ir-
 regulaties. He should not stand by to procrastinate the execution proceed-
 ings. If he so does, Rule 90(3) forewarns him that he pays penalty for
·iibduracy and contumacy. Ec1ually it is a reminder that the court should be
strict to comply with the procedural part under Rule 54(1A) before depriv- B
ing the judgment-debtor of the remedy under Article 21 Rule 90 C.P.C. If
he had noticed from court and acquiesced to take action before the date of
sale, he would be precluded to assail its legality or correctness thereafter.
 [364-F-H]

       5.2. The appellant had not been served with or given notice at the time
                                                                                   c
of drawing up the proclamation of sale and as a matter of fact no proclama-
tion of sale was drawn up by the executing court except accepting the ipsi
dixit of the decree-holder. The procedure adopted by the executing court
brittles with several irregularities touching the jurisdiction of the court.
They have not only material irregularities causing substantial injustice but       D
are in violation of the mandatory requirements of the rules.
                                                            [364-H; 365-A-RJ
       5.3. Under Section 47 C.P.C. all questions relating to execution, dis-
charge or satisfaction of the decree should be determined by the execution
court alone. The pre-sale illegalities committed in he execution are               E
amenable to the remedy under section 47. Post-sale illegalities or ir-
regularities causing substantial injury to the judgment-debtor are covered
under Order 21 Rule 90. There is distinction between mere irregularity and
material irregularity and the sale is not liable to be set aside on proof of
mere irregularity. It must be material irregularity and the court must be
satisfied that on account thereof substantial injury was sustained by the          F
appellant. [367-E-H]

      5.4. In the instant case, the sale of 550 sq. yards for recovery of paltry
sum of Rs. 7,780.33 without selling a portion thereof, caused substantial
injury to the appellant, and the same is set aside. [368-A]
                                                                                   G
      Ambati Narasayya v. M. Subba Rao, A.I.R. (1990) S.C. 119; Mangat
Prasad v. J(Jislma Kumar Maheshwmi, A.I.R. (1992) S.C. 1857; Takaseela
Pedda Subba Reddy v. Pujmi Padmavathamma, [1977] 3 S.C.R. 692 and
Kayjay Industries (P) Ltd. v. A.mew Dnuns (P) Ltd., [1974] 3 S.C.R. 678,
relied on.                                                                         H
    352                   SUPREME COURT REPORTS (1993) SUPP. 2 S.C.R.

A        Janak Raj v. Gurdial Singh & Anr., (1967) 2 S.C.R. 77; Chinnamal v.
    P. Ammugham, (1990] 1 S.C.C. 513 and Dhirendra Nath Gorai & Subal
    Chandra v. Sudhir Chandra Ghosh, [1964] 6 S.C.R. 10001, distinguished.

            [This Court directed the appellant to withdraw the sum of Rs.
    7, 780.33 from the Court of the Rent Controller and deposit the same
B   towards decree amount for being paid to the first respondent, and that the
    appellant was free to withdraw the balance. It also observed that the
    11uction purchaser was free to withdraw the sale price deposited in Bank
    viz. Rs. 1,05,000 with interest.]


c 1984. CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2692 of
          From the Judgment and Order dated 8.5.84 of the Delhi High Court
    in C.M. (M) No. 122 of 1984.

D         Dcsh Bandhu Gupta in person for the Appellant.

           M.S. Gujral and S.K. Sabharwal for the Respondent No. 1.

          K. Madhava Reddy, Raju Ramachandran and Joseph Pookkatt for
     the Respondent No. 2.
E          The Judgment of the Court was delivered by

           K. RAMASWAMY, J. The appellant judgment debtor, was a tenant
     of Smt. Shanti Devi, who applied on September 28, 1974 for eviction of him
     for committing default in paying the rent. On September 30, 1974, she sold
F    it to the first respondent who got impleaded himself in the pending
     proceedings and also independently sought for eviction. Pending the
     proceedings the appellant deposited rent in the name of Shanti Devi which
     now is ultimately found to be Rs. 13,440. The decree for eviction made
     against him was ultimately confirmed by this court. The suit of the first
     respondent for the arrears of rent was decreed for a sum of Rs. 6,419.98.
G    Pending eviction proceedings, in the Writ Petition No. 830 of 1978 of the
     appellant, the High Court of Delhi directed on September 6,1979, after
     hearing both the parties, and without prejudice to the contentions of the
     respondent, that the amount deposited by him may be credited to the
      account of the respondent. The first respondent filed E.P . No. 1974/78 in
H     the court of the Addi. Sub Judge, !st Class for sale of the appellant's plot
                D.B.GUPTA v. N.L.ANAND [RAMASWAMY,J.J                     353

of land bearing 31/35, Punjabi Bagh, New Delhi, a commercial area of an          A
extent of 550 square yards to recover Rs. 7,780.33 which includes costs. On
November 4,1978 warrant of its attachment was issued under Order 21
Rule 54 in Form 24 of appendix 'E' of the schedule to C.P.C. On becoming
aware of that the appellant filed an objection petition contending that since
he had already deposited in the Rent Control case Rs. 13,440.00, more than
                                                                                 B
the decretal amount, in the Rent Control Court, the decree stands satisfied
and became inexecutable. He also pleaded that Execution Court is devoid
of jurisdiction as its pecuniary jurisdiction is limited to Rs. 25,000. Argu-
ments were heard thereon. Ultimately on April 20, 1979 the Court passed
the order thus :
                                                                                 c
             "Order dictated on this date. The Decree Holder has moved
         an application under. Order 21 Rule 66, CPC for warrant of
         proclamation of sale by public auction of the property of JD. I.
         Accordingly allow the application of the Decree Holder for sale
         of the property of the J.D. as per the following programmes:-
                                                                                 D
         Court door                3 May, 1990

         Spot                      17 May, 1979

         Auction                   6 July, 1979
                                                                                 E
         Report                    13 July, 1979."

         (original records were called for and this was the only order found
         from the record)

       Admittedly the app,ellant was neither given notice nor was he             F
present, nor aware of passing that order. On May 2, 1979 sale warrant
under Order 21 Rule 66, C.P.C. was issued. On July 6, 1979 auction was
held in which Rajinder Singh and his wife Tavinder Kaur were joint highest
bidders for a sum of Rs. 1,05,000. On becoming aware of the sale on August
10, 1979 the appellant immediately filed a petition under Order 21 Rule 90
C.P.C. raising objection to the validity of the sale. On inspection of the       G
record he later on filed an application, which was allowed on payment of
costs, to impugne the sale under s. 47 Order 151 C.P.C. He pleaded that
the sale was collusive and fraudulent. The value of the site was Rs. 3,50,000.
It was sold for inadequate price. He was not served with any notice either
under Order 21 Rule 54 or under Order 21 Rule 66. There is no sale               H
    354                   SUPREME COURT REPORTS 119931SUPP.2 S.C.R.

A   proclamation. No notice was issued before settling the terms of the
    proclamation of sale. The sale proclamation neither specified the place or
    time al which the sale was lo he conducted, nor was it published in the
    locality. He reiterated his plea of his prior deposit of more than the E.P.,
    amount, and the execution court's lack of pecuniary jurisdiction and ab-
    sence of wide publicity led to fetching of Jess price. The so called bidders
B   were not genuine persons nor had the capacity lo purchase the property.
    Only the second respondent and his brother were the participants and the
    bid was, therefore, a collusive one. The Execution Court held that due
     procedure was followed in bringing the property to sale. In view of Order
     21 Rule 90(3) the objections raised to the validity of the sale cannot be
c    gone into. The price fetched was an adequate one. The attachment order
     was served by affixing it on the site and there was no collusion. Accordingly
     I.he application was rejected and confirmed the sale. The Appellate Court,
     without going into all the contentions, considered the scope of Order 21
     Rule 90(3) and held that by its operation pre-sale illegalities or ir-
D    regularities do not vitiate the sale and dismissed the appeal. The High
     Court dismissed the revision in limine. Thus this appeal by special leave.

         Mr. Gupta, the appellant, an Advocate argued in person. The first
  respondent, the decree holder, is also an Advocate, but appeared through
  Mr. Gujral, learned Senior counsel. The auction purchaser was represented
E by Mr. K. Madhava Reddy, the learned Senior Counsel. The contention of
  Mr. Gupta that the Execution Court having been conferred with pecuniary
  jurisdiction upto Rs. 25,000, had no jurisdiction to execute the decree
  against the property whose value is Rs. 3,50,000, is devoid of substance.
  Under 21 Rule 10 of CPC an application for execution should be made to
F the  court "which passed the decree". Therefore, the value of the property
  sold at the execution is more than Rs. 25,000 does not take away the
  jurisdiction of the trial court. In Banwar Lal v. Smt. Prem Lata, AIR (1990)
  SC 623, this court held that the value of the property sold in execution is
  not relevant to determine the jurisdiction of the execution court. Admit-
   tedly the decree in execution for Rs. 7780.33 is within the jurisdiction of
G the trial court, which passed the decree. Equally the contention of Sri
   Madhava Reddy that the mode of payment of money decree envisaged
   under Order 21 Rule 1(1) must be by deposit of the decree amount into
   the court is equally devoid of force. Undoubtedly, literal reading of Order
   21 Rule l(l) provides that the mode of paying decretal money is either by
H depositing in the Executing Court or sending to the court by postal orde'r
             0.13. GUPTA v. N.L. ANAND fRAMASW.'\.l\;fY, J.]          355

 or through bank draft or out of court to the decree holder by postal order A
 or bank draft or any other mode where the payment is evidenced in writing
 or as the court which made the decree otherwise directs. The other
 sub-rules are not relevant for the purpose of this case. By amending the
 rule in 1976 a right has been given ta the judgment debtor to pay the decree
 debt either by depositing into the Executing Court or to send it by other
modes of payment with intimation to the decree holder in latter cases so
                                                                              B
that the liability to pay interest ceases from that date. It is an enabling
provision for the benefit of judgment debtor. Though by literal construction
 the appellant should deposit the decretal amount into the Executing Court
for claiming the benefit of the discharge but anterior to it, in the Rent
 Controller proceedings, the decree holder had knowledge of undoubted       c
 deposit of the amount made by the appellant. The liberty of "without
prejudice" given to the respondent by the High Court in the Writ Petition
was for the purpose of his defence, that the deposit in Shanti Devi's name
was not payment to him, after knowledge of his purchase, for the purpose
 of default. But the parties being Advocates adopted legalistic stands. The D
substance is that even before execution was laid the amount was available
towards satisfaction of the decree. The court should have directed its
attachment and payment made or directed the appellant to withdraw that
amount and deposit into the court, instead of launching tardious process
of execution by sale of immovable property. When the factum of deposit
was disputed, this court called for a report and the Addi. Dist. Judge, had E
in his report, stated that the appellant deposited about 13,000 and odd and
it was lying in credit in the Rent Controller proceedings. The further
contention that there were other liabilities which the appellant had not
discharged, bears no foundation. Even otherwise there was no order of
attachment of that amount by any court. The finding of the appellate court F
that the deposit was not to the credit of the suit is also not legal. In our
considered view neither the stand of the Ist respondent nor the reasoning
of the courts below are tenable. When the arrears of rent for which the
decree was made was already in deposit to the knowledge of Anand in his
eviction case and when the appellant objected to the execution, the Execut-
ing Court either should have directed the appellant to withdraw the money G
and credit the same to the suit account before its attachment was made or
it should have passed an order under Order 21 Rule 23(2) which postulates
thus: "Where such persons offers any objection to the execution of the
decree, the court shall consider such objection and make such order as it
                                                                            H
    356                   SUPREME COURT REPORTS (1993] SUPP. 2 S.C.R.

A   thinks fit." It is, therefore, the mandatory duty of the Executing Court to
    consider such objection and to make an order in that behalf. No such order
    has been made. It is true that in the contempt application filed by the
    appellant against the first respondent, an order was passed rejecting the
    appellant's contention that he had already deposited the decretal amount.
    Objection should independently be considered under Order 21 Rule 23.
B   The order in the contempt petition is not a substitute to an order under
     Order 21 Rule 23(2), CPC. The objections, therefore, are still open to the
     appellant for being raised impugning the validity of the sale. The procedure
     is the handmaid to justice. The substance of the matter, in the given
     circumstances is that the deposit made in the eviction case be considered
c    to be one made under Order 21 Rule 1(1) (a) into the suit out of which
     the execution arose.

          The further contention of Sri Madhava Reddy that the appellant
    should have filed an appeal against an action of the Execution Court in not
D   considering the objections is also devoid of substance. Had the court
    considered the objections and passed an order under Order 21 Rule 23(2),
    it would be incumbent upon the appellant to carry the order in an appeal.
    The omission to consider the objections is not appealable. Had an order
    been made on the objections and was allowed it to become final, perhaps
    Order 21 Rule 90(3) would operate against the· objector. So the objection
E   would still be open to the appellant to reiterate in his petition after the sale
    under s. 47 or Order 21 Rule 90.

         The further contention of Sri Madhava Reddy that the objection
  petition and the appeal are not maintainable as the wife of Rajinder Singh,
p joint purchaser was not impleaded ea-nominee as respondent, too is devoid
  of force. The application to set aside the execution sale is primarily against
  the decree holder since he is a person at whose instance and benefit the
  execution proceedings were initiated and the sale was held to discharge his
  decree debt. Therefore, primarily he is the person entitled to be heard and
  since he is in-charge of publishing the notices and to conduct the sale, it
G is he that lays before the court the steps taken or the procedure followed
  in service of notice or conducting the sale and to establish that they have
  been done properly, regularly and in accordance with the law. The auction
  purchaser gets right only on confirmation of sale and till then this right is
  nebulous and has only right to consideration for confirmation of sale. If the
H sale is set aside, apart from the auction purchaser, the decree holder is
              D.B. GUPTA v. N.L. ANAND [RAMASWAMY,].]                     357

affected since the realisation of his decree holder is put off and he would     A
be obligated to initiate execution proceedings afresh lo recover the decree
debt. Therefore, in the proceedings under s.47 or Order 21 Rule 90, the
decree holder is the affected necessary party. Though the auction pur-
chaser need to be impleaded co-nominee as respondent as the property
was purchased jointly at the court sale, it is enough that one among them
                                                                                B
had been impleaded as a party. It is not necessary to implead all the joint
purchasers.

      The contention of Mr. Gupta that as Form 29 of appendix 'E'
prescribes that when an auction purchaser participated in the bid on behalf
of third party, he should file his power or authority to bid at the auction C
on behalf of the third party, and in its absence the sale itself is a nullity, is
devoid of substance. The rigour of the need to obtain power or authority
arises only when he acts as an agent but not when he had, per himself and
other's behalf, participated in the bid. Prudence requires that the sale
officer should satisfy himself whether the participant is a real or proxy D
bidder. It should exclude the proxy unless he places before him the
authority that in the event of the sale being knocked down, he would be
bound by the sale and terms thereof. The second respondent admittedly
participated and purchased the property not only on his behalf but also on
behalf of his wife. Therefore, the need to obtain such power from his wife
to bid on her behalf also is obviated.                                            E

       Mr. Gupta contended that under Order 21Rule54 the appellant had
 not been served with the order of attachment. Either the appellant or the
inmates of his house were always available at his residence. It was said to
have been affixed at the site and his enquiries revealed that no such affixer p
at the site was made. It is an admitted position that no personal service on
the appellant was effected but nonetheless evidence discloses that it was
affixed at the site. The purpose of attachment under rule 54 is to make the
judgment debtor aware that attachment has been effected and that he
should not make any transfer or encumber the property thereafter. It is in
the interest of the decree holder to have the notice of attachment served G
personally on the judgment debtor. Nevertheless the sale is not void,
though the omission to serve ·the copy of the order of attachment is an
irregularity. Since no encumbrance thereafter was created on the attached
property, non-service of the copy of the order of attachment on the
judgment debtor does not render the sale invalid.                             H



                                                                  I
    358                   SUPREME COURT REPORTS [1993) SUPP. 2 S.C.R.

A         It is further contended that property was not fully described except
    mentioning the plot number and the extent which is not consislcnt with the
    Form No. 24 of appendix 'E' which postulates that the property should be
    fully described. It is ·seen that in the execution petition a plan with full
    description was attached. The evidence is not clear whether the plan was
    attached to the order of attachment or a copy thereof was attached to it.
B
    It was for the benefit of the intending purchasers to inspect the property
    before deciding to participate in the auction. Nevertheless so long as the
    property is identifiable, the omission of full description of the plot also is
    only an irregularity. In any event the bidders were not misled.

c          However, there is considerable force in the contention of the appel-
    lant that the procedure prescribed under Order 21 Rule 66 was flagrently
    violated by the Executing Court. We have alrroady 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
D   property in execution. On an application for execution filed under Order
    21 rule 5 the court shall ascertain the compliance of the prerequisites
    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
E   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 proper-
F   ty 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
G   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 and Delivery to the Purchaser' Rule 2 provides that
H   whenever a court makes an order for the sale of any attached property




               \
             D.ll. CilJPTA ,. N.I.. ANAND jRAMASWAMY, J.]                359

under Order 21, Ruic 64, it shall fix a convenient date not being distant A
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 he given to the parties or their pleaders. In Rule 4 captioned 'Settle-
ment of Proclamation of sale, estimate of value' it is stated that on the day
so fixed, the conrt shall, after perusing the documents, if any, and the B
report referred to in the preceding paragraph, after examining the decree
holder 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 specification have been enumerated
in the rule itself. The proclamation for sale is an important part of the
                                                                               c
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 at proclamation of sale the estimate
of the value of the property. The proclamation when settled shall be signed
hy the Judge and got published in the manner prescribed by Rule 67. The D
court should authorise its officers to conduct 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 proclama-
tion should include the estimate, if any, given by either JD or DH or both
the parties. Service of notice on Judgment debtor under Order 21 Rule E
66(2), unless waived by appearance or remained ex parte, is a fundamental
step in the procedure of the court in execution. J.D. 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 F
bidders are not misled or to prevent them from 0ffering inadequate price
or to enable them to make a decision in offering adequate price. In
Gajadhar Prasad & Ors. v. Babu Bhakta Ratan & Ors., [1974] 1 SCR 372,
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 G
estimated value of the property to be sold, must not accept merely the ipse
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
                                                                               H
    360                   SUPREME COURT REPORTS [1993) SUPP. 2 S.C.R.

A sale proclamation, which may confuse bidders. It may also be quite mis-
  leading 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
  si1ould 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,
B
  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
C debtor where they both have valued the 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 proclamation
  has to be determined on the facts of each particular case. Inflexible rules
D 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 .iudgment-debtor unless he voluntarily appears and given oppor-
   tunity in the settlement of the value of the property. The absence of notice
E causes irremedial 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
F
   judgment debtor disables him to offer his estimate of the value who is
   better knows its value and to publicise on his part convassing 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
G conduct of sale. It would be broached from yet another angle. The com-
    pulsory 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
H
             D.B. GUPTA v. N.L. ANAND [RAMASWAMY,J.]                    361

notice to the judgment debtor is a nullity since it divests the judgment A
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 salutory 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 B
estimate as he is the person who intimately knew the value of his property
and prevailing in the locality, exaggerating may at time be possible. In
Rajagopal Iyer v. Ramachandra Iyer, ILR (1947) Mad. 288, 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 s. 47.                             C

      Above discussion do indicate discernable 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),          D
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 that the J.D. shall be served
with a notice before settling the terms of the proclamation of sale. The
omission thereof renders the further action and the sale in pursuance         E
thereof void unless the judgment debtor appears without notice and there-
by waives the service of notice.

      In the case before us, the execution court had completely overlooked
compliance of the mandatory procedure, accepted ipsi dixit of the decree F
holder even without calling amin's report. The decree holder in a complaint
given to the Income-tax Department got valued the site with an approved
valuer at Rs. 3,33,333.00 but he valued in the E.P. at Rs. 1,00,000. The
Court accepted it without indicating grounds for this preference and had
given a programme of sale. It did not bother even to consider the objections
of the judgment debtor raised at the earliest of the need to proceed with G
the execution when sufficient amount to meet the decree debt was already
in deposit. It is a case of non-application of judicial mind and abdication
of judicial duty. Though the insertion of an order judicially passed need
not be made in the sale proclamation but the record should indicate that
a judical order has been passed showing that it had applied its mind to the H
    362                  SUPREME COURT REPORTS [1993] SUPP. 2 S.C.R.

A   need for determining all the essential particulars, which would reasonably
    be looked for by an intending purchaser. The relevant and material par-
    ticulars should be inserted in the sale procbimed as accurntcly and precise-
    ly as possible. Th,.; order should show that it considered the objections, if
    any, of the decree holders or the judgment debtors, as the case may be. It
    should not merely accept unhesitatingly the ipse dixit of one or either side
B   or hoth.

           The contentions of Sri Madhava Reddy and G uj aral that the appel-
    lant had not given his valuation and that, therefore, it is not open to him
    to raise the objections after the sale is unacceptable. Since the court had
c   not given any notice to the appellant which is mandatory, the need to
    submit his valuation did not arise. Order 21 Rule 54 sub-rule (IA) brought
    by 1976 Amendment Act mandates that the court should require the
    judgment debtor to attend the court on a specified date to take notice of
    the court to be fixed for settling the terms of proclamation of sale. Form
D   24 of Appendix 'E' second para and the court Rules also evisage the
    mandate. It is a reminder to the court that it has a statutory duty to issue
    notice to JD before settlement of the terms of proclamation of sale. Then
    only the proviso to rule 66(2) comes into play dispensing with multiplicity
    of notices and not dispensation of mandatc,iry compliance of notice to the
    JD. Had it been a case where notice was served and the appellant lay by,
E   without objecting to rhc valuation given by the decree holder, certainly that
    would be put against the appellant to impugne the irregularities after the
    sale or the under-valuation settled hy the court in the proclamation of sale.
    The further contentions of both the counsel that merely because there is
    no order under Order 21 Rule 66(2), it cannot be construed that the
F   Execution court had not applied its mind in settling the terms of the
    proclamation of sale is one of desperation. Except giving a schedule of
    dates for conducting the sale the Execution Court totally abdicated its duty
    to scruplulously complying with the mandatory procedure and did not
    apply its mind to the mandatory duty cast on it by Order 21 Rule 66 to
G   settle the terms of proclamation of sale, proper publication under Rule 67.
    After April 20, 1979, the court had merely ensured to publish it in the court
    notice board and on the site at the respective dates and no further. This
    court in Shalimar Cinema v. Bhasin Film Cmporation, AIR (1987) SC 2081,
    held that the court has a duty lo see that the requirements of Order 21
    Rule 66 are properly complied with. lt is incumbent upon the court to be
H   scrupulous in the given extreme. No action of the court or its officer ;hould
             D.B. GUPTA v. N.L.ANAND [RAMASWAMY,J.]                     363

be such as to give rise to the criticism that it was done in a casual way. A
Therefore, a proclamation of sale drawn casually without compliance of
the mandatory requirement and a sale held in furtherance thereof a not a
sale in the eye of law. We are of the considered view that the. procedure
adopted by the court in non-compliance of Order 21 Rule 66 and 67 is in
flagrant breach of the mandatory provision. It is a nullity ab initio.
                                                                               B
      Yet another contention of Mr. Gupta is that the sale of the plot of
550 wq. yards is in excess of the execution and the order to sell it is the
result of non-application of mind touching the jurisdiction of the court
rendering the sale void or manifestly illigal. Therefore, the need to invoke
Order 21 Rule 90 does not arise and it can be set aside under s. 47 C.P.C.     C

       Proviso to sub-rule (4) of rule 17 of Order 21 provides the procedure
to receive the application for execution of the decree. In the case of a
decree for payment of money, the value of the property attached shall, as
nearly as may be, correspond with the amount due under the decree. Rule D
64 of order 21 charges the executing court that it may order to attach any
property to the extent that "such portion thereof as may seem necessary to
satisfy the decree would be sold". It is also enjoined under sub-rule (2)(a)
of Rule 66 of Order 21 that where a part of the property would be sufficient
to satisfy the decree the same be sold by public auction. Form 27 of
Appendix E of the schedule also directs the court auctioneer to sell so E
much of the said property as shall realise the sum in the said decree and
costs. The code, therefore, has taken special care charging the duty on the
executing court and it has a salutory duty and a legislative mandate to apply
its mind before settling the terms of proclamation and satisfy that if part
of such property as seem necessary to satisfy the decree should be sold if p
the sale proceeds or portion thereof is sufficient for payment to the decree
holder or the person entitled under the decree to receive the amount and
so much of that property alone should be ordered to be sold in execution.
In Ambati Nara.rnJya v. M. Subba Rao, AIR [1990] SC 119, fhis court held
that it is the duty cast upon the court under Order 21 Rule 64 to sell only
such property or a portion thereof as may be necessary to satisfy the G
decree. It is a mandate of the legislature which cannot be ignored. Therein
for execution of a decree of a sum of Rs. 2,000 and costs, the appellant's
10 acres land was brought to sale which was purchased for a sm of Rs.
17,000, subject to discharge of a prior mortgage of Rs. 2,000. This court
held that without the court's examining whether a portion of the property H
    364                    SUPREME COURT REPORTS (1993] SUPP. 2 S.C.R.

A could be sold, the sale held was not in conformity with the requirement of
  Order 21 rule 64 and it was held to be illegal and without jurisdiction. The
  sale was set aside and the court was directed to put the judgment debtor
  in possession of the land and to refund the sale amount to the auction
  purchaser. Further direction was given to execute the decree in accordance
  with law. In Mangat Prasad v. Klishna Kumar Maheshwa1i, AIR (1992) SC
B
  1857, a shop was sold to realise a decree debt of about Rs. 29,000 and the
  sale price at the auction was Rs. 1.00 lac and odd. This court finding that
  it is excessive execution, set aside the sale and directed return of the sale
  amount to the auction purchaser with interest@ 12%. In Takaseela Pedda
  Subba Reddy v. Pujari Padmavathamma, (1977) 3 SCR 692, to recover the
c decree debt in two decrees, the properties situated in two different villages
  were brought to sale. In the first instance the property in 'D' village fetched
  a sum of Rs. 16,880, which was sufficient to satisfy the decretal amount.
  The property in 'G' village was also sold which fetched a sum of Rs. 12,000.
  This court set aside the sale of 'G' village. Admittedly the site in sale is to
D the extent of 550 sq. yards, situated in a commercial area around which the
  petroleum installations are established. Though, as contended by Sri Mad-
  hava Reddy, that there may be building regulation for division of the
   property into portions, but court made no attempt to sell a portion of the
  property, may be 100 yards or 150 yards, out of it, or undivided portion
   thereof would have satisfied the decree debt. It could be legitimately
E concluded that the court did not apply its mind at all to this aspect as well.

            To get over the difficulty, Sri Madhava Reddy has fallen back on
     Order 21 Rule 19(3) of the Code, which provides that "no application to
     set aside the sale under this rule shall be entertained upon any ground
F    which the applicant could have taken on or before the date of which the
     proclamation of sale was drawn up." Undoubtedly, this special rule was
     brought on statute by 1976 Amendment Act. It is like a "caveat emptor"
     that the judgment debtor be vigilant and watchful to vindicate pre-sale
     illegalities or material irregularities. He should not standby to procrastinate
     the execution proceedings. If he so does, Rule 90(3) forewarns him that he
G    pays penalty for obduracy and contumacy. Equally it is a reminder that the
     court should be strict to comply with the procedural part under Rule
     54(1A) before depriving the JD of the remedy under Art. 21 Rule 90 CPC.
     If he had notice from court and acquiesced by taking no action before the
     date of sale, he would be precluded to assail its legality or correctness
H    thereafter. It is seen that the appellant had not been served with or given
             D.B.GUPTA v. N.L.ANAND[RAMASWAMY,J.]                         365

 notice at the time of drawing up the proclamation of sale and as a fact no A
 proclama.tion of sale was drawn up by the executing court except accepting
 the ipsi dixit of the decree holder. The procedure adopted by the executing
 court brittles with serveral irregularities touching the jurisdiction of the
 court. They have not only material irregularities causing substantial injus-
tice but are in violation of the mandatory requirements of the rules. In
Kayjay !11dust1ies (P) Ltd. v. Asnew Drnms (P) Ltd., [1974] 3 SCR 678, the
                                                                                  B
sale proclamation was settled after notice to the parties and after several
adjournments. The respondent adopted dilatory tactics to obstruct the sale.
Therefore, the valuation in the report submitted in that behalf was ac-
cepted and the properties were sold. This court held that if there was any
                                                                                c
material irregularities in the conduct of sale and if it causes sufficient injury
to the judgment-debtor the same could be set aside where the court
mechanically conducts the sale not bothering to see tha~ the offer is too
low and the better price could have been obtained. If, in fact, the price is
substantially inadequate there is both material irregularity and injury. At
the same time the court should not go on adjourning the sale till a good D
price is got as otherwise the decree holder would never get the property
of the judgment debtor sold. This court further held that there is always
considerable difference between the court sale price and the market price.
The court sale is a forced sale and notwithstanding the competitive element
of a public auction, the best price is not always forthcoming. The valuer's
report though good as a basis, is not as good as an actual offer and there E
are bound to be variations within limits between such an estimate, however
careful, and the real bids by the seasoned businessman. Mere inadequacy
of price cannot demolish a court sale. Further, if the court sales are too
frequently adjourned with a view to obtaining a still higher price, prospec-
tive bidders will lose faith in the actual sale taking place and may not attend
                                                                                  F
at the auction. What is expected of the court is to make a realistic app-
raisal of the factors in a pragmatic way and if satisfied that in the given
circumstances .the bi4_ is acceptable it should conclude the sale. The court
may consider the fair value of the property, the general economic trend,
the large sum required to be produced by the bidder, the formation of a
syndicate, the utility of postponements and the possibility of litigation and G
several other factors depending on facts of each case. If the court has fairly
applied its mind to the relevant considerations while accepting the final
bid, it is not necessary to give a speaking order nor can its order be
examined meticulously. In that case the judgment debtor himself was
                                                                                H
    366                     SUPREME COURT REPORTS [19931SUPP.2 S.C.R.

A    adopting dilatory tactics and the property was sold after considerable delay
     and postponements. The sale was upheld.

          In Janak Raj v. Gurdial Singh & Anr., [19671 2 SCR 77, relied on by
  Sri Madhava Reddy, in execution of ex-parte decree for a sum of Rs. 519,
B the property of the judgment debtor was brought to sale and was sold for
  a sum of Rs. 5,100. Thereafter the judgment-debtor made an application
  to set aside the ex-parte decree. An objection was raised to the sale on the
  ground that the value of the house was Rs. 25,000 and it was auctioned for
  a sum of Rs. 5000. The ex-parte decree was set aside. On application made
  by the auction purchaser, the sale was confirmed. It was contended that
C since the ex-parte decree was set aside the confirmation of sale need to be
  set aside, which was negatived by all the courts. In that background it was
  held that confirmation of the sale was not illegal and the inadequacy of the
  price was not a ground to set aside the sale. The ratio therein has to be
  considered in the light of its own scenerio. The facts in this case are entirely
D different. The case of Chinnammal v. P. Anunugham, [1990j 1 SCC 513,
  also does not help the auction purchaser. Therein it was found that pending
  appeal the money decree was executed and the properties were brought to
  sale. The High Court allowed the appeal and set aside the decree. There-
  after the exf'.cuting court was moved to set aside the sale on diverse grounds
  including the plea of inadequacy of price. The learned single Judge set
E aside the sale, but the division bench reversed the decision. On appeal, this
  court held that the auction purchaser was not a bonafide purchaser. The
  auction sale in his favour was set aside and the restitution ordered. The
  court cannot lend assistance to a person to retain the property of the
  judgment debtor who has since got rid of the decree. In that context it was
F held that the stranger auction purchaser who is not a party to the decree
  is protected against the vicissitudes or fortunes of the litigation and remains
  unaffected and does not lose title to the property by subsequent reversal
  or modification of the decree. The rights of bonafide purchaser who
  purchased the property in ignorance of the litigation should be proteded.
  The ratio in that cause would indicate that the purchaser must be a
G bonafide purchaser for adequate price without knowledge of the pending
  litigation. If it is otherwise, it is liable to be set aside. In that context it was
  held that the true question is whether the stranger auction purchaser had
  knowledge of the pending litigation about the decree under execution. If it
  is shown by evidence that he was aware of the pending appeal against the
H decree, when he purchased the property, the court cannot assume that he
             D.B. GUPTA v. N.L.ANAND [RAMASWAMY).)                     367

was a bonafic.le purchaser for giving him protection against restitution. His A
knowlec.lge about the pending litigation would make all the difference in
the case. Though he may be stranger to the suit, but he must be held to
have taken a calculated risk in purchasing the property. Far from helping
the auction purchaser this goes against him. Mr. Gupta contended that
Rejinder Singh is not a bonafide purchaser. His brother is the adjacent
                                                                               B
owner of the site in question. The second respondent and his brother only
mac.le the bids and participated in the sale. Rest of the people had no
capacity to purchase the property. The sale, therefore, is only a fraudulent
and collusive one. Though we find some substance in what Mr. Gupta
contends for, we need not to go into that question on the facts of this case.
Suffice to state that all its not well. It is true that there is a distinction C
between irregularity and material irregularity in conducting the sale and it
must be established that by reasons of illegalities or irregularities in con-
ducting the sale, the judgment debtor has sustained substantial injury. In
Dhirendra Nath Gorai & Subal Chandra v. Sudhir Chandra Ghosh, [1964]
6 SCR 1001, this court held that non-compliance of s. 35 of the Bengal D
Money Lenders Act does not render the sale void. It is only an irregularity.
The judgment-debtor having had the knowledge did not file any objection.
He did not attend the court for drawing up of the proclamation of the sale.
On those circumstances the sale was held not liable to be set aside.

       Under s. 47 all questions relating to execution, discharge or satisfac- E
tion of the decree should be determined by the execution court alone. The
pre-sale illegalities committed in the execution are amenable to the remedy
under s. 47 Post-sale illegalities or irregularities causing substantial injury
to the JD and covered under Order 21 Rule 90. Sub-rule (1) thereof covers
the field of material irregularities or fraud in publicity or conducting the F
sale. Sub-rule (2) enjoins proof thereof and the court should find that by
reason thereof the applicant sustained substantial injury. The total absence
of drawing up of the proclamation of sale and settlement of its term by
judicial application of mine.I renders the sale a nullity Being void. It is
covered bys. 47. The non-application of mind whether sale of a part of the
property would satisfy the decree debt is a material irregularity doing G
substantial injury to the appellant attracting Order 21 Rule 90. In either
case the sale is liable to be set aside. It is true that there is distinction
between mere irregularity and material irregularities and the sale is not
liable to be set aside on proof of mere irregularity. It must be material
irregularity and the court must be satisfied that on account thereof sub- H
    368                   SUPREME COURT REPORTS (1993) SUPP. 2 S.C.R.

A stantial injury was sustained by the appellant. The sale of 550 sq. yards for
    recovery of paltry sum of Rs. 7, 780-33, without selling a portion thereof,
    caused substantial injury to the appellant.

          The sale is set aside. The confirmation of sale is also set aside. The
    appellant is directed to without the sum of Rs. 7,780.33 Paise within six
B   weeks from today from the court of the Rent Controller and deposit it
    towards decree amount. The Rent Controller should order payment. The
    Subordinate Judge on deposit, should thereon record full satisfaction and
    pay over the same to the first respondent. The appellant is free to withdraw
    the balance amount from the court of the Rent Controller. The auction
C   purchaser Rajinder Singh is free to withdraw his Rs. 1,05,000 and interest
    accrued thereon from the bank deposit as ordered by the court. The
    Registry should take such steps as are necessary to enable him to withdraw
    the said amount. The appeal is allowed, but with no costs, as the appellant
    argued in person.

                                                               Appeal allowed.


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