23 August 1996
Supreme Court


Case number: Appeal Civil 2901 of 1991






DATE OF JUDGMENT:       23/08/1996


CITATION:  JT 1996 (7)   423        1996 SCALE  (6)133



JUDGMENT:                       J U D G M E N T J.S. VERMA. J.      The  appellant   obtained  a   money   decree   against respondent no.  1 on 25.12.1982. On 02.01.1983 the appellant filed an application for execution of the decree by recovery of the  amount of  Rs.17,892/-. The  appellant  applied  for recovery of  the decretel amount by sale of e large tract of agricultural land of the respondent no.1, the value of which shown by  the appellant was Rs.73,000/- in 1976. The auction was held  on 10.12.1984.  The appellant  bid at that auction with the  permission of the Court. The appellant bid was for the amount  of Rs.23,500/-.  On 12.12.1984  the bid  of  the appellant was  accepted  The  appellant  did  not  make  any deposit on the date of auction and claimed adjustment of the decretal amount  against the  sale price.  Admittedly, there was a  shortfall in  the sale price, even after the decretal amount was  set off  and the  deposit made  by the appellant within the time allowed was taken into account. After expiry of the period prescribed for payment of the full sale price, on 19.4.1985  the appellant deposited Rs.3,727.25 which fell short towards  the sale  price of  Rs.23,500/-. On 18.9.1985 the executing  court accepted  this amount  of  Rs.3,727.25, taking the  view that the shortage in deposit was due to the mistake of  the court  office in  making the calculation and the court has inherent power to correct its own mistake. The judgment-debtor filed  objection to the validity of the sale which was rejected.      The  judgment-debtor,   respondent  no.1,  preferred  a revision against  this order  of the  executing court to the District Judge,  which was  dismissed. The  judgment debtor, respondent no.1,  filed a  petition under Article 227 of the Constitution of  India in  the High  Court, which  has  been allowed. By  interim order  dated 19.12.1986  the High Court directed further  proceedings for  the confirmation  of  the sale to  remain stayed  subject to  the condition  that  the Judgment-debtor,  respondent   no  1,   deposit  the  entire



decretal amount  within 2  months. On 9.1.1987 the judgment- debtor  deposited   Rs.19,773/-,   which   fell   short   by Rs.2,007.85. This shortage also appears to have occurred due to the  mistake in  calculation of  the court’s  office. The judgment-debtor, on  discovery of  the mistake deposited the remaining amount  of  Rs.2,007.85.  However,  the  executing court proceeded with the execution and confirmed the sale on 4.5.1987 and  a gave possession of the land auctioned to the appellant. By  order dated 19.4.1990 the High Court allotted the petition  of the  respondent  no.1  and  held  that  the judgment-debtor has  been wrongly dispossessed from the land inspite of  the interim  order dated  19.12.1986 ;  that the full amount  of  sale  price  not  being  deposited  by  the appellant within  the time fixed order XXI, rule 85, code of Civil Procedure,  the deposit  of the  balance amount of Rs. 3,727,25 much  later did  not cure  the  defect,  since  the executing court has not power to extend that time.      This appeal  by special  leave is  by the decree-holder against the  above order  of the  High Court. In view of the fact that  the appellant  is continuing in possession of the land auctioned  inspite of  the orders of the High Court. in this appeal  stay was  granted in favour of the appellant by the interim  order dated  6 8.1991  subject to the following conditions :      "a) The  appellant must  deposit  a      sum of  Rs.65,000/- as  security in      the Trial  Court within a period of      6   months    from   today   in   3      instalments The first instalment of      Rs.20,000/-  shall   be   deposited      within a  period of  2 months  from      today; the second instalment of Rs.      20,000/-  within   a  period  of  4      months from  today;  and  the  last      instalment for Rs.25,000/- within a      period of 6 months from today;      b)  The   appellant  must   further      deposit a  sum of  Rs.15,000/-  per      year in  the Trial  Court  for  the      period June,  1991 till  the appeal      is finally  disposed of. The amount      shall be deposited on or before the      31st of  July each  year. the first      deposit being  on  or  before  31.7      1992.      c) The amount deposited as directed      above  shall  be  invested  by  the      Trial  Court  in  interest  earning      fixed deposits  in  a  nationalised      bank and  shall be  subject to  the      direction of this court.      d) In case of default in depositing      any of  the  aforesaid  amounts  as      mentioned in  Clause  (a)  and  (b)      above  the   order  of  stay  shall      automatically stand vacated."      Shri Satish  Chandra, learned counsel for the appellant submitted that  the consequences envisaged by Order XXI Rule 85 due  to the  non deposit  of the  full sale  price do not ensue in the present case because the shortage in deposit by the mistake  of the  Court in  specifying a lesser amount in the sale  proclamation as  the decretal  amount then due. He submitted that  in these  circumstances Rule 90 and not Rule 85 of  Order XXI applies and report to the provision in Rule 90 not  being made  by the  Judgment debtor, the validity of



the sale remains unaffected. He submitted that the judgment- debtor had  to make  an application under Rule 90 within the prescribed period of 15 days to set aside the sale which was not done  and, therefore,  the sale  had to be confirmed. It was also  argued that the actual date of sale in the present case must  be taken  to be  the date  on which  the  correct amount due  under the decree was calculated by the Court for the purpose  of set  off against  the sale price and not the date on  which the  sale was  actually held. Learned counsel further submitted  that the  judgment-debtor not having made the deposit  in accordance with Rule 89(2) of Order XXI, the confirmation of sale cannot be questioned.      In  reply  Shri  J.P.  Goel  learned  counsel  for  the respondent  no.1,   judgment-debtor,  submitted   that   the provision in  Order XXI  Rule  85  is  mandatory,  requiring strict  compliance   and  the   undoubted  failure   by  the appellant. to  deposit the  full amount of sale price within the time  prescribed therein,  rendered the  sale void since there was  no power  in the  executing court  to extend that period. Shri  Goel also submitted that a large tract of land was auctioned  for a  very low  price for recovery of a much lesser decretal  amount and  this has deprived the judgment- debtors respondent no.1, of his only source of livelihood.      The main  point for  decision is  whether there is non- compliance of  order XXI  Rule 85 to render the auction sale void  The   above  facts   are  undisputed.  It.  is  beyond controversy that  the full  amount of purchase money payable by the  purchaser into  the Court was not paid by him within 15 days  from the  date of  the auction  sale. This  result. ensues even  after giving  the advantage  of set  off of the decretal among  due to  the purchaser decree-holder to which he may  have been  entitled under Rule 72. The only argument to avoid  its consequence  is  that  the  shortfall  in  the deposit was  occasioned by  a mistake  of the  Court in  the calculation of  the  amount,  of  which  the  appellant  was entitled to  claim set-off  under Rule  72 The  Question  is whether  this  plea  is  tenable  to  avert  the  inevitable consequences of  the  failure  to  comply  with  the  strict requirement of Rule 85.      In Manilal Mohanlal Shah and Ors. Vs Sardar dated Ahmed Sayed Mahamad  & Anr,  1955(1) SCR  108, this Court examined the scheme  of the  provisions of the Rules 84, 85 and 86 of Order XXI Code of Civil Procedure and held as under :           "  ...The  principal  question      which falls  to  be  considered  is      whether the  failure  to  make  the      deposit under  Order XXI,  rules 84      and  85,   is   only   a   material      irregularity in  the sale which can      only be  set aside under rule 90 or      whethers it  is wholly  void. It is      argued that  the case  falls within      the   former   category   and   the      application  under  rule  90  being      barred  by   limitationl  the  sale      cannot be  set aside.  It  is  also      contended  that  the  Court  having      once  allowed   the   set-off   and      condoned the  failure  to  deposit,      the mistake of the Court should not      be   allowed   to   prejudice   the      purchasers who would certainly have      deposited the  purchase who but for      the mistake,  We are of the opinion      that  both   the  contentions   are



    devoid of  substance. In  order  to      resolve    this    controversy    a      reference to  the relevant rules of      Order XXI  of the  Civil  Procedure      Code will be necessary. These Rules      are 72, 84, 85 8 and 86:      xxx              xxx            xxx           The scheme of the rules quoted      above  may   be  shortly  stated  A      decree-holder    cannot    purchase      property at  the  Court-auction  in      execution of his own decree without      the express permission of the Court      and that  when he does so with such      permissions he  is  entitled  to  a      set-off, but  if he does so without      such permission, then the Court has      a discretion  to set aside the sale      upon   the   application   by   the      judgment-debtor,   or   any   other      person whose interests are affected      by the  sale (Rule 72)˜ As a matter      of pure construction this provision      is  obviously   directory  and  not      mandatory -  See Rai  Radha Krishna      and Others  Vs. Bisheshar Sahal and      Others (49  IA 3125.  The moment  a      person  is   declared  to   be  the      purchaser, he  is bound  to deposit      25 per  cent of  the purchase-money      unless he happens to be the decree-      holder, in which case the Court may      not require him to do so (Rule 84).           The  provision  regarding  the      deposit  of  25  per  sent  by  the      purchaser other  than  the  decree-      holder is mandatory as the language      of  the  rule  suggests,  The  full      amount of  the purchase-money  must      be paid  within fifteen  days  from      the date of the sale but the decree      holder is entitled to the advantage      of a  set-off.  The  provision  for      payment  is   however,   mandatory.      (Rule 85).  If the  payment is  not      made  within   the  per  period  of      fifteen days,  the Court.  has  the      discretion to  forfeit the deposit,      and there  the discretion  ends but      the  obligation  of  the  Court  to      resell the  property is imperative.      A  further   consequence  of   non-      payment  is   that  the  defaulting      purchaser forfeits all claim to the      property.....(Rule 86).      xxx              xxx            xxx                        (Pases 112 - 114)           "Having examined  the language      of  the   relevant  rules  and  the      judicial decisions bearing upon the      subject we  are of opinion that the      provisions of  the rules  requiring      the deposit  of 25  Per cent of the      purchase-money immediately  on  the      Person   being    declared   as   a



    purchaser and  the payment  of  the      balance within  15 days of the sale      are   mandatory   and   upon   non-      compliance  with  these  provisions      there is  no sale at all. The rules      do not  contemplate that  there can      be  any   sale  in   favour  of   a      purchaser  without   depositing  25      percent of  the purchaser-money  in      the first  instance and the balance      within 15  days. When  there is  no      sale within  the  contemplation  of      these  rules,   there  can   be  no      question, of  material irregularity      in the  conduct of  the sale.  Non-      payment of the price on the part of      the  defaulting  purchaser  renders      the sale  proceedings as a complete      nullity. The  very  fact  that  the      Court  is   bound  to   resell  the      property in  the event of a default      shows that  the previous proceeding      for sale  are completely  wiped out      as if  they do not exist in the eye      of law. we hold, therefore, that in      the circumstances  of  the  present      case there  was  no  sale  and  the      purchasers acquired  no  rights  at      all.           It was  urged before  us  that      the Court  could allow a set-off in      execution  proceedings   under  its      inherent  powers   apart  from  the      provisions of  Order XXI,  rule 19,      of the  Civil Procedure Code. We do      not think  that the inherent powers      of the  Court could  be invoked  to      circumvent the mandatory provisions      of  the   Code  and   relieve   the      purchasers of  their obligation  to      make the deposit...."                      ( Pages 116 - 117 )      It is  to be  noted that the argument that it is only a material irregularity in the sale to attract Rule 90 instead of Rule  85 was  expressly rejected; and it was clearly held that Rule  85 being mandatory, its noncompliance renders the sale proceedings  a complete nullity requiring the executing court to  urged under  Rule 86 and property has to be resold unless the  judgment-debtor satisfies  the decree  by making the  payment  before  the  resale.  The  argument  that  the executing court  has inherent  power to  extend time  on the ground of  its own  mistake was  also expressly rejected. In our opinion  the contentions  of  learned  counsel  for  the appellant are fully negatived by this decision of the Court;      We may  also indicate  that the persistent assertion on behalf of  the appellant that the shortage in deposit by the appellant was occasioned by a mistake of the executing court in indicating  the figure  of the decretal amount due in the sale proclamation also has no sound basis. the provisions in Order XXI  relating to  sale of property beginning with Rule 64 clearly  indicate the responsibility of the decree-holder in this  behalf and  his role in the drawing up of  the sale proclamation. The  executing court proclamation and draws up the sale  proclamation on  the basis of information supplied by the decree-holder. Rule 66 of Order XXI is as under:-



    "Proclamation   of   sales   public      auction :-      "(1) Where  any property is ordered      et  sold   by  public   auction  in      execution of  a decree,  the  Court      shall cause  a proclamation  of the      intended sale  to be  made 117  the      language of such Court      (2)  Such   proclamation  shall  be      drawn  up   after  notice   to  the      decree-holder  and   the  Judgment-      debtor and shall state the time and      place  of   sale,  and  specify  as      fairly and accurately as possible-           (a) the  property to  be  sold           or,  where   a  part   of  the           property would  be  sufficient           to satisfy  the  decree,  such           part;           (b) the  revenue assessed upon           the  estate  or  part  of  the           estate, where  the property to           be sold  is an  interest in an           estate  or   in  part   of  an           estate, paying  revenue to the           Government;           (c) any  incumbrance to  which           the property is liable;           (d)   the   amount   for   the           recovery of  which the sale is           ordered; and           (e) every other thing which           the Court considers material           for a purchaser to know in           order to judge of the nature           and value of the property:           Provided that  where notice of      the date  for settling the terms of      proclamation has  been given to the      judgment-debtor  by   means  of  an      order under  rule 54, it shall Act.      be necessary  to  give notice under      this rule  to  the  judgment-debtor      unless the court otherwise directs:           Provided further  that nothing      in this  rule shall be construed as      requiring the Court to enter in the      proclamation  of   sale   its   own      estimate  of   the  value   of  the      property but the proclamation shall      include  the   estimate,  if   any,      given, by  either or  both  of  the      parties.      (3) Every  application for an order      for sole  under this  rule shall be      accompanied by statement signed and      verified  in   the  manner   herein      before prescribed  for the  signing      and verification  of pleadings  and      containing,  so  far  as  they  are      known to  or can  be ascertained by      the person making the verification,      the matters  required  by  sub-rule      (2)  to   be   specified   in   the      proclamation.



    (4) For the purpose of ascertaining      the matters  to be specified in the      proclamation, the  Court may summon      any person whom it thinks necessary      to summon  and may  examine him  in      respect to  any  such  matters  and      require him to produce any document      in his possession or power relating      thereto."      It is  clear that  the sale proclamation is drawn up by the execution court after notice to the decree-holder, on an application for  an order for sale made by the decree-holder which is  to  be  accompanied  by  a  statement  signed  and verified by  the decree-holder  in the prescribed manner and containing the  matters  required  by  sub-rule  (2)  to  be specified in  the  proclamation,  which  also  includes  the amount for  the recovery  of which  the sale  is ordered. It follows that  the amount  for the recovery of which the sale is ordered  is stated  in the sale proclamation on the basis of the  duly signed  and  verified  statement  made  by  the decree-holder’s accompanies  the decree-holder’s application for an  order sale.  The specification  of  the  amount  for recovery  of   which  the  sale  was  ordered  in  the  sale proclamation being  based on  a statement made and  verified by the decree-holder, it is not open to the decree-holder to claim that  he was misled by any mistake of the Court in the specification of  the amount.  the Blame,  if any,  for  the mistake lies  squarely on  the decree-holder.  Moreover, the decree-holder knows  best the amount to which he is entitled under the  decree, and  he does not have to depend on anyone else to  furnish this  Information. A  mistake for which the decree-holder himself is responsible cannot furnish a ground to the  decree-holder to  avert the  adverse consequences on him of  his failure  to comply with to mandatory requirement of Rule 85.      It is  also to  be noted  that the duty to pay the full amount of  purchase money within the prescribed period of 15 days from  the date  of sale  of the property is cast on the purchaser by  virtue of  Rule 85 of Order XXI and therefore, the entire  responsibility to  make full  compliance of  the mandatory provision  is his.  The proviso to Rule 85 enacted for the  benefit of  the purchaser  when he  is the  decree- holder and  entitled to  the advantage  of any set off under Rule 72 The proviso giving this benefit to the decree-holder purchaser  merely   relieves  him   of  the  requirement  of depositing that  amount of which he is entitled to claim set off, but  it does not relieve him of the duty to deposit the full amount  taking advantage  of the  set off.  Any mistake made while  claiming the set off which results in failure to deposit the  full amount of purchase money within 15 days of the date  of sale renders the decree-holder purchaser liable to the same adverse on consequences which would ensue to any other purchaser  due to  non-compliance of  Rule 85.  No  17 distinction  is   made  between  a  decree-holder  purchaser entitled to  claim set  off under  Rule  72  and  any  other purchaser for  the purpose  of strict  compliance  with  the requirement  under  Rule  85.  The  contentions  of  learned counsel for the appellant have no merit      The High  Court has  taken the view that there was also non-compliance. of Rule 84 of Order XXI since 25 per cent of the amount  of the  purchase money  was not deposited by the appellant immediately  as required  by Clause  1 of Rule 84. Learned  counsel   for  the  appellant  submitted  that  the appellant was  entitled to  set of under Rule 72 as provided in Clause  2 of  Rule  84.  In  reply  learned  counsel  for



respondent no.1  submitted that  the Court had not dispensed with dispensed  with this  requirement as no such permission was sought  by the appellant. In view of our conclusion that there was  a clear not-compliance of the requirement of rule 85 which  rendered  the  sale  a  nullity,  we  consider  it unnecessary to  decide this  further question in the present case.      The question now is of the ultimate order to make while dismissing this  appeal,  in  view  of  the  fact  that  the appellant is  in  possession  of  the  land  since  4.5.1987 inspite of  the stay order dated 19.12.1986 made by the High Court which  ultimately decided  in favour of the respondent the respondent  no.1 The  High Court has clearly stated that the entire  decretal amount  due  for  satisfaction  of  the decree had  been deposited  by the debtor respondent no.1 in the Court.  The interim  order dated  6.8.1991 made  in this appeal while  granting stay  to the appellant has also to be taken note  of. We are informed that the appellant has been, making the deposits as required by the order dated 6.8 1991. The appellant has enjoyed the usufruct of the property since 4.5.1987 even  though he  has, so  far, been deprived of the benefit of  the decretal  amount which is meagre as compared to the  benefit of  the enjoyment  of the  property  by  the appellant. On the other hand the Judgment-debtor, respondent no.1, delayed  the satisfaction of the decree which, to some extent contributed to this situation.      In the  circumstances of  the case,  the ultimate order which commends to us as the most appropriate, is as under :- 1) The  decretal amount  deposited by  the  judgment-debtor, respondent no.1, in the Court shall be paid to the appellant decree-holder. 2) In  these circumstances  one-half  of  the  total  amount deposited by  the appellant  in the Court in accordance with the order  dated 6.  8.1991, together  with  the  accretions thereto must be paid to the Judgment-debtor, respondent no.1 while the  remained one-half of the total amount be refunded to the appellant. 3) The  executing court  should proceed forthwith to restore possession  of   the  property   to   the   judgment-debtor, respondent no.1.  The Appellant must pay the amount due upto the date  of restoration  of  possession  according  to  the interim order  dated 6.8 1991, to be disbursed in the manner indicated above. 4) On compliance of the above directions the executing court is to record full satisfaction of the. decree and strike off the execution. 5) The  executing  court  is  to  make  such  orders  as  be necessary for giving full effect to these directions. We direct, accordingly      The appeal  is dismissed  in the above terms with costs quantified at Rs. 10.000/-.