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PETITIONER: NANI GOPAL PAUL

       Vs.

RESPONDENT: T. PRASAD SINGH & ORS.

DATE OF JUDGMENT06/03/1995

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. HANSARIA B.L. (J)

CITATION:  1995 AIR 1971            1995 SCC  (3) 579  JT 1995 (3)   387        1995 SCALE  (2)544

ACT:

HEADNOTE:

JUDGMENT: ORDER 1.   Leave granted, 2.   In  Suit  No. 2 of 1966 filed by Unite  Bank  of  India against  Hanuman Foundrie Ltd. for foreclosure and  sale  of hypothicated property, pursuant to a preliminary decree, the court  receiver  sold the hypothica at which  the  appellant became  highest bidder for Rs.60 lakhs and he paid a sum  of Rs.5 lakhs.  The sale was confirmed in his favour on  August 29, 1990.  Thereafter respondents No.1 and 2 were sought  to be impleaded to the suit but denied by the single Judge.  On appeal,  while impleading them, the Division Bench  directed the  single  Judge to hear the respondents before  they  are ejected from the property in question by order dated  2.3.92 which is the subject-matter of this appeal. 3.   While  disposing of the appeal, the Division Bench  has pointed out that the sale was vitiated due to the manner  in which  the  single Judge dealing with Company  Law  matters, passed the orders in his Chamber by observing thus:               "It would be sufficient for this court, if  we               make our observations to deprecate the way His               Lordship  took up the matter on various  dates               subsequent  to the passing of the  decree  and               sought to pass various orders relating to sale               of  the  property in favour of  the  intending               purchaser  Nani  Gopal Paul and  others  at  a               price  of Rs.60 lakhs, when there  were  other               offers  on the field of a higher  denomination               and magnitude.  Judicial property prevents  us               from making further comments in respect of the               manner   His   Lordship  directed   Mr.   Gour               Roychoudhury, the Receiver to make the  choice               relating to the intending purchaser with  full               rights  to make a contract with the  intending               purchaser  in the manner it was so  done.   If               there  were  other offers on  the  field,  the

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             court  would  have  been  vigilant  enough  to               scrutinies  such  offers  whatever  they  were               worth  and  there  ought to have  been  a  due               application   of  mind  in   this   particular               perspective.               Sadly  enough  that  was not so  done  in  the               present case." 4.   We  are of the view that we can take suo motu  judicial notice of the illegality pointed out by the Division Bench, 388 committed by the single Judge of the High Court in. bringing the  properties  to sale.  Accordingly, we are of  the  view that  the  circumstances  are  sufficient  to  vitiate   the validity  of  the sale conducted by the  court  Receiver  as approved by the learned single Judge.  Confirmation of  sale was  illegal.   Though, as contended by  Sri.   Ganesh  that normally  an  application under Order 21 Rule 89  or  90  or under  s.48 CPC need to be filed within limitation  to  have the sale conducted by the court set aside and that procedure need to be insisted upon, we are of the view that this court or  appellate  court  would not remain a  mute  or  helpless spectator  to obvious and manifest illegality  committed  in conducting court sales.  We are informed and it is not  dis- puted  that the appellant had deposited only Rs.5 lakhs  and balance  amount  was  assured to  be  deposited  only  after delivery of possession.  That also would be illegal. 5.Accordingly, the sale and confirmation thereof on  29.8.90 are set aside.  The appeal is remanded to the High Court and the  appropriate single Judge would proceed to  conduct  the sale in accordance with law by open auction after due publi- cation  of the sale so that all the intending bidders  would have opportunity to participate in the sale.  Thereafter, it would take action according to law.  Since it is a suit  for foreclosure and the preliminary decree has become final,  it is  not open to any party to widen the scope of the suit  or sale made pursuant to the preliminary decree.  If any  party has got any other right or remedy, the same has to be worked out  elsewhere, according to law and not in this  suit.   We are not expressing any opinion with regard to the rights, if any, of respondent Nos.  1 and 2 in the property. 6.The appeal is allowed with no orders as to costs. 389