G V HANAMSHET Vs. DADA CHINTAMANI PATRAVALI

JUDGEMENT

(1.) This is a revision by the applicant in I.A. 14 against the order dated 27-8-1982 passed by the Civil Judge, Belgaum, in Insolvency Petition 2 of 1962, dismissing the same.

(2.) I.A. 14 has been filed by the revision petitioner, alleging that the official receiver had sold the three properties bearing : (1) CTS. No. 41/A situate in Somwar Peth, Tilakwadi, Belgaum, (2) CTS. No. 4589/B of Shetti Galli, and (3) CTS. No. 4538 of Shetti Galli, Belgaum. The said three properties belonged to the insolvents. He alleged that there was no proper publication regarding the auction sale, held by the official receiver. As per the report given by the official receiver, she had published the notice regarding the auction sale in the newspaper called Lokadarshana, which has no wide publicity in the area of Belgaum City. The official receiver and the insolvents have colluded and the properties have been sold for highly inadequate price. CTS. No. 41/A measuring 4 guntas, where a building is constructed, has been sold only for Rs. 12,500/- in the public auction. CTS. No. 4589/B has been sold for Rs. 15,800/- and CTS. No. 4538 has been sold for Rs. 2,100/-. Now the price of all the three properties would be more than three lakhs of rupees. One of the highest bidders A.P. Patil respondent 4 in the revision is the son-in-law of insolvent 1. The other highest bidder Hukumchand Kote is also the son-in-law of insolvent 1. The other highest bidder V.S. Patravali respondent 5 is the son of insolvent 1. V.S. Patravali is the permanent resident of Satara and Hukumchand Kote is a permanent resident of Latur. It cannot be understood as to haw they came to know about the date of auction sale. Either they must have been brought by the insolvents or the properties must have been purchased in their names by someone interested in the insolvents. In 1978 CTS. No. 41/A was worth Rs. 1,25,000/-. The value of the other two properties was Rs. 60,000/- and Rs. 30,000/- respectively. The properties have been bid by these bidders at the lowest price in collusion with the official receiver. The properties have not been got valued by the Government approved valuer. So, it was requested that the sale held by the official receiver should not be confirmed and the official receiver may be directed to hold a fresh sale after giving due publicity in the newspapers like 'Tarun Bharat' and 'Nirdosh' and after duly sending notices to the creditors. If that is not done, the creditors would be put to irreparable loss.

(3.) The official receiver and the bidders resisted the petition on the following grounds. - The present application filed under S.151 of the Code of Civil Procedure was not tenable in view of the specific provision contained in S.68 of the Provincial Insolvency Act, which is meant to challenge any act or decision of the official receiver, by means of an appeal within 20 days from the date of the act or the decision complained of. The petitioner had not filed any such appeal though the auction sale was held on 29-7-1978 in the Court after due publication of the proclamation of sale. The official receiver had apprised the petitioner of the auction sale by sending him a copy of the proclamation of sale, which was duly received by him. He was aware of the date, time and place of the auction sale. Similarly the other creditors of the insolvents were also duly informed of the date, time and place of the auction sale and the copies of the proclamation of sale were sent to them. But they too have not turned up and participated in the sale. Thus, it is not open to the petitioner to file application for setting aside the sale and to direct the official receiver to hold a fresh sale. The application is not only barred by limitation, but also barred by res judicata and estoppel. The Commercial Tax Officer, Belgaum had filed an appeal under S.80 for setting aside the auction sale. He contended inter alia that he had not received the cyclostyled copy of the proclamation sent under certificate of posting to all the creditors. But the said application was dismissed. One Shankar Dundappa Kangle had also made a similar application in Misc. No. 79 of 1978 for setting aside the auction sale. That too was dismissed. There are as many as 46 creditors, out of them two have exhausted all their remedies and if rest of the creditors are allowed to file applications one after another, it will take years to close the insolvency petition. It is falsely alleged by the petitioner that the auction sale was held by the official receiver without giving due publicity. It is denied that the newspaper Lokadarshan, in which the notice of proclamation of sale was published, has no wide publicity in the area of Belgaum city. It has a wide circulation of over 8000 copies per day. The official receiver was not interested in the insolvents and had no reason to collude with them. At the time of the auction, twelve bidders participated. Out of them three were the highest bidders and their bids were accepted. So far as the enquiries of the official receiver go, the bidder Shri A.P. Patil is not the son-in-law of insolvent 1 and his permanent residence is not Satara. So also, Hukumchand Kote is not the son-in-law of insolvent 1. It is correct that Sri V.S. Patravali is the son of insolvent 1. But he has separated from his father in the year 1961. The petitioner without knowing anything has rushed to the Court with the frivolous application. He has not explained as to why there is such an inordinate delay in making the application. The price for which the properties were sold was not the lowest and was not nominal. One of the properties is subject to mortgage of Rs. 17,378-68 from the year 1961. Naturally the above properties could not fetch the usual price since what was sold was the right, title and interest of the insolvents. The very fact that none of the 46 creditors turned up to offer any higher price at the auction sale is an indication that the properties being old buildings, subject to litigation, etc., were sold for proper price.