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PETITIONER: PUTTI KONDALA RAO & ORS.

       Vs.

RESPONDENT: VELLAMANCHILI SITARATTAMMA & ANR.

DATE OF JUDGMENT12/12/1975

BENCH: RAY, A.N. (CJ) BENCH: RAY, A.N. (CJ) BEG, M. HAMEEDULLAH SARKARIA, RANJIT SINGH SHINGAL, P.N.

CITATION:  1976 AIR  737            1976 SCR  (2) 998  1976 SCC  (1) 712

ACT:      Code of Civil Procedure-Order XXI, r. 90-Allegations of substantial  injury-If   can  be   implied  from  facts  and circumstances alleged.

HEADNOTE:      In an  application under  O.XXI, r. 90, Civil Procedure Code, the  appellants (judgment-debtors)  alleged  that  the sale of  their property  pursuant to  an order of attachment was illegal  for material  irregularities. The  trial  Court held that  where there  was an irregularity in the procedure for sale, the remedy would be to apply to set aside the sale on proof  of substantial  injury and that there was no fraud in the  sale, as  alleged by  the appellants. On appeal, the first appellate  Court held  that the  auction-purchaser was the husband  of the  decree-holder and  that there was gross under-valuation of  the property  and so set aside the sale. On further  appeal, the High Court held that the application of the appellants was defective and not maintainable and the Court had  no power  to set aside the sale unless facts were alleged and  proved by  the applicant to the satisfaction of the Court that he had sustained substantial injury by reason of such irregularity.      Dismissing the appeal, ^      HELD: (1)  The judgment  of the  trial Court  should be restored. The  trial Court was correct in its conclusion and reasons that  the property sold was subject to mortgages and charges and  was sold  at the  correct  price,  taking  into consideration  the   price  of   the   properties   in   the neighbourhood and other evidence on record. [1000 E, 1001 G]      (2)  The  judgment  of  the  trial  Court  was  wrongly reversed by  the first  appellate court. Substantial justice had been done to the parties. [1001-C]      (3) The  High Court was not unjustified in holding that the application for setting aside the sale was bald and that there was  no proper allegation of substantial injury to the appellants. Sometimes,  however, there  may not  be  express allegations of substantial injury and the same may appear to be implicit from all facts and circumstances alleged. In the

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present case,  the allegations in the petition could be read to imply  substantial injury  to the  appellants. The  trial Court as well as the first appellate court heard the parties and  decided  the  case  on  the  footing  that  there  were allegations of  substantial injury  to the appellants. [1001 E-F]      Luxmidevi v.  Sethani Mukand  Kanwar &  Ors., [1965]  1 S.C.R. 726, referred to.

JUDGMENT:      CIVIL APPELLATE  JURISDICTION : Civil Appeal No. 643 of 1975.      Appeal by  Special Leave  from the  Judgment and  order dated the  24-3-1973 of  the Andhra  Pradesh High  Court  in C.R.P. No. 1015/72.      M.K. Ramamurthi and B. Parthasarthi for the appellants.      B.V. Subrahmanyam and A. Subba Rao for the Respondents.      The Judgment of the Court was delivered by      RAY, C.J.  This appeal  is by  special leave  from  the judgment dated  24 March,  1973 of  the High Court of Andhra Pradesh. 999      The  High  Court  held  that  the  application  of  the appellants,  the  judgment  debtors  is  defective  and  not maintainable and  the Court  has no  power to  set aside the sale unless facts are alleged by the applicant and proved by him to  the satisfaction of the court that the applicant has sustained substantial injury by reason of such irregularity.      The respondents are the decree-holders. Pursuant to the decree there  was an  order for  attachment and  sale of the house property  of the  appellants. The sale took place on 7 June, 1960.      The appellants  filed an  application on  7 July,  1960 under Order  XXI Rule  90 of  the Code of Civil Procedure to set aside the sale. On 18 November, 1966 the application was dismissed by  the Munsif.  On 22 April, 1972 the Subordinate Judge allowed  the appeal  filed by the judgment debtors and set aside  the sale. The High Court pursuant to the revision petition presented  by the  auction purchaser  set aside the order of  the Subordinate  Court  on  the  ground  that  the application of  the appellants under Order XXI was defective and not maintainable.      The application  was in seven paragraphs. The first two paragraphs contained  the description of the petitioners and the respondents. In the third paragraph the judgment debtors alleged that the properties were purchased by the husband of the decree  holder. In  the fourth  paragraph  the  judgment debtors alleged  that the  sale  notices  were  deliberately suppressed from the knowledge of the judgment debtors. It is also alleged  that the  properties were undervalued and were sold in  favour of  the husband  who was  the nominee of the decree-holder. In  paragraph  5  it  was  alleged  that  the correct assessments  had not  been shown.  In paragraph 6 of the petition  it is  alleged that  the sale  is illegal  for material irregularities  and for  suppression of all notices to the  petitioners as  the respondents  1  and  2  colluded together  and  practised  fraud  upon  the  petitioners.  In paragraph 7  the judgment  debtors prayed  for setting aside the sale.      The Munsif by his order dated 18 November, 1966 noticed the contentions which arose for consideration. Those were as follows.  First,   whether  the   judgment  debtors  had  no knowledge of  the attachment or subsequent sale proceedings.

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Second, whether  the decree  holder practised fraud upon the judgment debtors.  Third,  whether  the  sale  was  illegal. Fourth,  whether   the  judgment   debtors   sustained   any substantial injury.      The sale  was to  be held  on 6  June, 1960. That was a public holiday  on account  of Bakrid.  There was  a gazette notification to  that effect. Because the date of sale was a public holiday,  the sale  was held  on the next day 7 June, 1960. The  Munsif held  that when the sale is held on a date different from that notified without an order of adjournment and a  further proclamation  of sale it would amount only to an irregularity  and the  remedy would  be to  apply to  set aside the  sale on  proof of  substantial injury. The Munsif held that there was no circumstance to make the sale illegal or invalid.      The  Munsif   further  held  that  the  attachment  was effective from  17  December,  1959.  One  of  the  judgment debtors who was the eldest 1000 brother was  present at the time of attachment. The youngest brother alleged  that he  was not  pulling on  well with the family members  because he  married a girl of another caste. The Munsif  held that  to be  an after-thought because there was no  evidence of  any discord  between the  brothers. The Munsif held  that the  judgment debtors were living together in the  house attached  and that  they had  knowledge of the attachment.      With regard to the sale notice the Munsif held that the judgment debtors  had knowledge  of the  attachment and sale and also held that no fraud was practised.      With regard  to the  question of substantial injury the Munsif held  that the  allegation in  the petition  that the property was  worth more than Rs. 25,000 and that the decree holder got  the same  undervalued was  to be  rejected.  The Munsif came to the conclusion that the adjacent property and the evidence  and material circumstances would show that the house could  not be  valued at  more than  Rs.  25,000.  The original sale  deed Ex.B-11  of the  adjoining house  showed that it  was sold for Rs. 12,000. That was a daba house with a tiled  one at  the back.  The property  which was sold was slightly larger  in area  than that one. But the Munsif held that  the   situation  of  the  house  of  the  neighbouhood properties all indicated that there was no under-valuation.      The property  was subject  to four mortgages. The three mortgages were for the sums of Rs. 1000/- Rs. 3500/- and Rs. 1800/- and the fourth mortgage was for Rs. 400/- aggregating Rs.  6700/-.  The  sale  was  held  subject  to  those  four mortgages. Interest  was at  12 per  cent. Interest  on  the principal amount  would be  more than Rs. 1000/- on the date of the  sale. The amount of Rs. 6125/- which was the auction price was  subject to  the mortgages.  Further there  was  a maintenance charge in favour of one Kamakshamma for a sum of Rs. 60/-  per year.  In this background the Munsif held that the sale was valid.      Before   the   Subordinate   Judge   two   points   for consideration in  the appeal were whether there was material irregularity or  fraud in the publication and conduct of the sale and whether they sustained substantial loss or injury.      The Subordinate  Judge held  that the  sale on  7 June, 1960 without  an order  of adjournment  was an irregularity. The price shown in the sale proclamation was Rs. 6000/-. The decree holder  valued the property at Rs. 16,000/-. The Amin valued  the   property  at   Rs.  20,000/-   free  from  all encumbrances. The  Subordinate Judge  held that the property was subject  to the  charge and  the  sale  was  subject  to

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mortgages. The Subordinate Judge came to the conclusion that the auction  purchaser was  the husband of the decree-holder and there  was gross under-valuation of the property and set aside the sale.      The decision  of this  Court in  Laxmidevi  v.  Sethani Mukand Kanwar  & Ors.(1)  held that  it depends upon several relevant facts  whether the  judgment debtor  has suffered a substantial injury at a judicial sale. 1001      The features  brought out on the materials in this case are that there was proper service and the sale was held on 7 June, 1960  because the  previous day  was a public holiday. The judgment  debtors did  not  give  their  valuation.  The property sold  was subject  to  mortgages  and  charge.  The decree holders have been kept out of the fruit of the decree for about  17 years. The attempt on the part of the judgment debtors to  set aside  the sale  was an  afterthought as was found by  the Munsif.  The Subordinate  Judge was  impressed with the  suggestion that the property was under-valued. The Subordinate Judge was wrong there. The Munsif was correct in his conclusion  and  reasons  that  the  property  sold  was subject to mortgages and charges and was sold at the correct price  taking   into  consideration   the   price   in   the neighbourhood and other evidence on record.      The High  Court found  that there  was no allegation of substantial injury  in the  petition. It  appears  from  the record that  the Trial  Court and  the first Appellate Court addressed  themselves   at  length   on  the   question   of substantial injury.  Parties were  heard.  They  made  their submissions. The  conclusions of  the Trial  Court  and  the Appellate Court are there.      Counsel for  the appellant  submitted that  if  we  set aside the  judgment of the High Court, the matter would have to be remanded for hearing on other points. It will serve no useful purpose to send the matter to the High Court on other questions. There  has been  substantial justice  done to the parties.  The  judgment  of  the  Trial  Court  was  wrongly reversed by the first Appellate Court.      The High  Court was not unjustified on the materials to hold that  the application  for setting  aside the  sale was bald and  there was  no  proper  allegation  of  substantial injury to  the judgment  debtors. Some times, however, there may not  be express  allegations of  substantial in jury and the same  may appear  to be  implicit  from  all  facts  and circumstances alleged.  In the present case, the Trial Court as well  as the  first Appellate Court heard the parties and decided the  case on the footing that there were allegations of substantial injury to the judgment debtors.      For these  reasons we  proceed on  the basis  that  the allegations  in   the  petition   could  be  read  to  imply substantial injury  to  the  judgment  debtors.  It  is  not necessary to  remand the matter to the High Court because we are of  opinion that  the judgment  of the  Trial  Court  is correct and  should be  restored. We, therefore, dismiss the appeal. The appellants will pay costs to the respondents. P.B.R.    Appeal dismissed. 1002