MAGANLAL RAMNARAYAN Vs. JAISWAL INDUSTRIES NEEMACH:MAGANLAL

JUDGEMENT

(1.) These two appeals by special leave raise an interesting question as to whether the provisions contained in Order 34 Rule 5 of Civil P.C. (hereinafter referred to as the Code) are attracted during the course of execution of an order of sale of mortgaged property passed under S. 32 of the State Financial Corporations Act, 1951 (hereinafter referred to as the Act). Necessary facts in order to appreciate the context in which this question arises may be stated in brief. Maganlal who is the appellant in Civil Appeal No. 2990 of 1980 executed a mortgage on July 16, 1965 in favour of M.P. State Financial Corporation (hereinafter referred to as the Corporation) as security for a loan taken by him from the Corporation. The amount of loan not having been paid by Maganlal the Corporation initiated proceedings under S. 31 of the Act for recovery of Rs. 51,799/-, which according to it was the amount due, by attachment and sale of the mortgaged property. This application was made as contemplated by Section 31 of the Act before the District Judge. After adopting the procedure contemplated by section 31 of the Act the District Judge passed an order for sale of the property which was ultimately sold for Rs. 53,000/- in an auction. M/s Jaiswal Industries (hereinafter referred to as the first purchaser) was the highest bidder. Maganlal made an application under Order 21 Rule 90 of the Code for setting aside the sale. This application was allowed by the Additional District Judge and the sale was set aside. Aggrieved by that order the first purchaser preferred a miscellaneous appeal in the High Court and also made an application for staying further proceedings for re-sale. The High Court, however, did not stay further proceedings for re-sale but only ordered that the fresh sale should not be confirmed till the disposal of the appeal. Fresh auction accordingly took place and the sale was knocked down in favour of Ramnarayan and others (hereinafter referred to as the second purchaser) who are the appellants in Civil Appeal No. 2991 of 1980. The appeal of the first purchaser was subsequently allowed by the High Court. The application made by Maganlal under O. 21 R. 90 of the Code was dismissed and the sale in favour of the first purchaser was confirmed. It is this order which, has been challenged in Civil Appeal No. 2990 of 1980 by Maganlal and by the second purchaser in Civil Appeal No. 2991 of 1980, as already indicated above.

(2.) Maganlal has made an application before this Court under O. 34 R. 5 of the Code being C. M. P. No. 9940 of 1982 to which an objection has been filed. This application was ordered to be put up at the time of the hearing of the appeal. Subsequent events and proceedings of the court below on the basis whereof this application has been made as stated therein are these. A sum of Rs. 65,000/- was paid by Maganlal to the Corporation on December 3, 1980 in full and final settlement of its claim and the Corporation acknowledged it by granting a receipt. Certification of the adjustment thus made was recorded by the District Judge on April 6, 1981. An application purporting to be under Order 34 Rule 5 of the Code was made on November 20, 1981 by Maganlal for depositing Rs. 2,650/- equivalent of 5% of Rs. 53,000/- which was the highest bid of the first purchaser and a further sum of Rs. 7,300/- that is, 5% of Rs. 1,46,000/- which was the highest bid of the second purchaser. The prayer which was made in this application was that the aforesaid sums may be paid to the first and second purchasers respectively and a final decree be passed in his favour in accordance with O. 34 R. 5 of the Code. The Additional District Judge by his order dated November 27, 1981 permitted Maganlal to deposit the two amounts separately at his risk and we are informed by his learned counsel that these amounts were deposited in pursuance of the said permission. According to learned counsel for Maganlal no final orders were passed on the aforesaid application by the Additional District Judge in view of the pendency of these appeals in this Court and it was as such that C.M.P. No. 9940 of 1982 referred to above was filed in this Court.

(3.) It was urged by learned counsel for Maganlal that in case C.M.P. No. 9940 of 1982 is allowed it will not be necessary for him to press the merits of the appeals and it is only in the event of the said application being dismissed that merits of the appeal will have to be pressed. He, therefore, made a request that the said application may be decided first. Learned counsel for the first and the second purchasers did not seriously dispute the above contention. We have accordingly heard learned counsel for the parties on the said application and have not heard them on the merits of the appeals at this stage.