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PETITIONER: STATE BANK OF INDIA

       Vs.

RESPONDENT: AJIT JAIN & OTHERS

DATE OF JUDGMENT01/12/1994

BENCH: SAHAI, R.M. (J) BENCH: SAHAI, R.M. (J) HANSARIA B.L. (J)

CITATION:  1995 SCC  Supl.  (1) 683 JT 1995 (1)    60  1994 SCALE  (5)65

ACT:

HEADNOTE:

JUDGMENT: R.M. SAHAI, J.: 1.       These  appeals  are  by  the  decree  holder.   The appellant  a  statutory  bank, filed  a  suit  for  recovery of  Rs.5,22,585.37  with cost and  future  interest  against respondent no.2 sometime in 1975. The suit was decreed  with costs and future interest at 6% per annum on 7th April 1976. On  12th  August  1976  the  appellant  filed  an  execution application  for  sale of suit property  of  the  respondent no.2.  On  this application the Executing Court  issued  the warrants of attachment on 25th August 1976. The property was auctioned on 15th June 1979 for a sum of Rs. 1,90,000/-. The appellant  filed an objection against the sale  and  claimed that the reserved price of the property being  Rs.6,00,000/- the sale was vitiated as the property was sold in  violation of  not only the reserved price fixed by the  appellant  but was  contrary  to  the procedure required  to  be  followed. Objection was filed by the judgment debtor too. The property was  purchased  by  Shri  Ajit Jain  and  four  others.  The objections  were  contested by the auction  purchasers.  The Executing  Court dismissed both the objections filed by  the appellant  and the judgment debtor. The appellant,  however, filed  an  appeal  against dismissal of  the  objection  and confirmation of the sale in favour of the auction purchaser. The order was set aside by the High Court as the  objections had been dismissed without affording any opportunity to  the objectors to lead evidence. in pursuance of the order passed by the High Court the Trial Court framed issues both in  the objection filed by the judgment-debtor and the appellant and permitted  the parties to lead evidence as well.  The  Trial Court  dismissed  both the objections and  directed  a  sale certificate under O.XXI R.90 of the Code of Civil Procedure, to be issued in respect of the property in dispute in favour of  auction purchasers. This order was challenged  in  first appeal before the High Court. Four of the auction purchasers stated  before  the Court that the auction sale may  be  set

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aside.  The learned Single Judge was of the  opinion:’  that since four of the auction purchasers stated, ’that the  sale in the present case is void being in violation of  mandatory provisions   of  law,  hence  the  present  application   is maintainable and the sale was Iiable to be set aside without entering into another controversy’. This order was set aside by the Division Bench. 62 2.     The  bank has now filed an appeal in this  Court.  We have  heard the learned counsel for parties at length.  When this appeal came up for hearing on 11th May 1994 we were  of opinion that due to protracted litigation a decree  obtained by the appellant as far back as 1976 has not been  executed. Further  Shri  Ajit Jain who is the auction  purchaser,  has entered into possession and is continuing as such since past many years. In view of this we had passed following order:                   "In     execution    of    decree      for               Rs.5,22,585.37,  Plot No.360-61 in  Industrial               Area,    Chandigarh   along   with    building               constructed  thereon and machinery  in  smiled               was sold on 15.6.79 for a consideration of Rs.               1 lakh and 90 thousand. The bank decree holder               filed  an objection under Order 21 Rule 19  of               the C.P.C. claiming various irregularities  in               auction proceedings. Objections were filed  by               judgment-debtor   as  well.  Since  then   the               litigation  has  been  going  on  between  the               parties and this appeal has been filed by  the               decree  holder against remand order passed  by               the Division Bench of the High Court directing               the  Single  Judge to decide  the  dispute  on               merits  as out of five auction purchasers  one               had not consented for setting aside the sale. 3.      Having  heard  learned  counsel  for   parties   and considering  the long delay which has taken place we are  of the opinion that it would be in the interest of justice  and all  the parties if the matter is amicably settled  as  four out  of five auction purchasers have given in  writing  that the sale be set-aside. In our opinion, the decree holder and auction  purchasers should be adequately  compensated.   But what  should  be the compensation to be agreed  between  the parties?               We,  therefore, direct this appeal to come  up               for  further orders in the 3rd week  of  July,               1994 in Chambers if the bench is not  sitting.               We hope that the parties in the meantime shall               negotiate and workout  the solution and report               the  compromise to this Court when the  appeal               is taken up on the next date." This  order was passed by us as we were of the opinion  that if  the  sale were to be set aside it  would  work  hardship against Shri Ajit Jain who is one of the auction  purchasers and  is in exclusive possession of the property. Whereas  if it  is  upheld  then it would be  extremely  unjust  to  the appellant.   As   stated   earlier  the   decree   was   for Rs.5,22,585.37  in  1976.  It  has  swelled  to  nearly  Rs. 15,00,000/-   and   the   bank   would   be   getting   only Rs.l,90,000/-.  That  the property is  valuable,  cannot  be disputed,  as even according to auction purchaser  the  rent which accrued from the premises in dispute between 17.3.1979 to  19.9.1984 came to Rs.7,35,000/-. This itself shows  that the  sale of the property for a sum of .Rs.  1,90,000/-  was inadequate. In this context it is necessary to mention  that one  of the pleas raised by the appellant and the  judgment- debtor  was that the auction purchaser prevented any  bidder

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from   entering  the  plea  of  auction.  We   consider   it unnecessary   to   record  any  finding  on  it.   But   the inadequacies  of the amount for which the property was  sold coupled with the statement of four of the auction purchasers that the sale was vitiated gives credence to the plea raised on behalf of the appellant. No further need be said. 4.    In the circumstances we dispose of these appeals under Article  142 of the Constitution of India to do  substantial and  complete  justice between the parties. Shri  Ajit  Jain during  course  of arguments had agreed that  he  would  not stick to the price of 63 Rs.  1,90,000/-  and was willing to pay  substantial  amount both to the bank and to the decree-holder so that the future litigation  may be avoided provided his claim alone  to  the property was accepted. That in our opinion does not  present any  difficulty. Since four of the auction  purchasers  have voluntarily withdrawn from the auction they cannot have  any right  or claim over the property in dispute. In  case  they have  contributed any amount towards payment of the  auction amount they shall be entitled to claim refund from Shri Ajit Jain. 5.      Shri  Ajit Jain shall PaY a sum  of  Rupees  Fifteen Lakhs  to the bank even though if the dues are taken  as  on today they are more than Rupees Fifteen Lakhs. This  payment would   be  in  full  and  final  settlement  of  the   dues outstanding against the judgment-debtor and it would  result in  discharging him of all the claims of the  appellant-bank against  him.  Shri  Ajit Jain shall further pay  a  sum  of Rs.5,00,000/-   to  the  judgment-debtor.   The  amount   of Rs.3,00,000/- withdrawn by the judgment debtor from the rent deposited  shall  not  be  adjusted  towards  this  payment. Remaining  amount in deposit shall be paid to the  judgment- debtor.   Shri Jain shall deposit balance amount,  that  is, Rupees Five Lakhs minus the amount which is lying in deposit towards rent and Rupees Fifteen Lakhs minus Rupees One  Lakh Ninety Thousand, the auction amount as we are informed  this amount  is  lying  in deposit with  the  Court.   All  these amounts  shall be deposited within three months from  today. The  bank  and  the judgment-debtor  shall  be  entitled  to withdraw the same. 6.     In case of failure to deposit the judgment and  order of  all the courts including auction sale held on 15th  June 1979 shall stand set aside. 7.    The appeals are disposed of accordingly. Parties shall bear their own costs. 64