P KASTURI BAI Vs. T VARADAN

JUDGEMENT

(1.) THE plaintiff is the appellant THE suit was filed by her for declaration that the sale held on 5th June, 1968 at the instance of the defendants 1 to 3 in favour of the fourth defendant for Rs. 6,000 in pursuance of the power of sale under the mortgage dated 17th May. 1956, is illegal, void and not binding on the plaintiff. Though the suit property originally belonged to the plaintiff and the eighth defendant, the plaintiff himself later became the owner of the entirety of the property. Under the mortgage dated 17th May, 1956, the property was mortgaged in favour of one Thangavelu Naicker. whose legal representatives are defendants 1 to 3. THE defendants 6 and 7 in this suit filed O.S. No. 107 of 1964, on the file of this Court which was later on transferred and numbered in City Civil Court, Madras as O.S. No. 5288 of 1968, in which defendants 6 and 7 laid a claim of title to the property. In this suit the plaintiff, eighth defendant and the mortgagee were made parties. During the pendency of the suit, a receiver was appointed in respect of the suit property and he was in possession of the same. Subsequent to the appointment of the receiver, without prior sanction and permission of the Court, which had appointed the receiver, the mortgagee purporting to exercise his power under section 69 of THE Transfer of Property Act, brought the property to sale and sold the same on 6th June, 1968, for a sum of Rs. 6,000 to the fourth defendant in this suit. Subsequent to this sale, the suit filed by defendants 6 and 7 claiming title was dismissed, thereby upholding the title of the plaintiff to the entirety of the property. THEreafter the plaintiff had filed this suit for a declaration that the sale under section 69 of the Transfer of Property Act, was illegal and not binding on her on the ground that the sale was effected during the period when the receiver was in possession and without the permission of the Court which appointed the receiver. Both the Courts below held that the sale was valid and binding and accordingly dismissed the suit. It is further held by the Courts below that the sale itself could be avoided only on a substantial legal ground and since the plaintiff had not stated any ground for setting aside the sale, except the statement that the sale was held when the receiver was in possession of the property in question and without the sanction of the Court and that therefore the suit is liable to be dismissed. THE learned counsel for the appellant submitted that this view of the Courts below is not correct and that the plaintiff is entitled to have the sale set aside on the mere fact that the sale was held without the prior permission of the Court which appointed the receiver. In support of this contention, the learned counsel for the appellant relied on a decision of the Supreme Court in Kanhaiyalal v. Dr. D. R. Banji and others 1 . In that case in a suit on a mortgage a receiver was appointed and the property was in the custody of the receiver. THE Government for recovery of the land revenue, took proceedings under the Berar Land Revenue Code and ultimately brought the property to sale and sold the same for a sum of Rs. 270 while the mortgage itself was for Rs. 70.000. THE revenue sale was held without the leave of the Court concerned. THE receiver thereafter filed a suit to set aside the revenue sale on the ground that the revenue officer could not sell the property without the prior permission of the Bombay High Court as She property was in possession of that Court through the receiver appointed by it. THE trial Judge set aside the revenue sale which was confirmed by the Division Bench in a Letters Patent Appeal. THE purchaser at the revenue sale preferred a further appeal to the Supreme Court. It was contended on behalf of the auction-purchaser that the sale without the notice to the receiver or without the leave of the Court was not void but only irregular and that in any event a regular suit in a civil Court was not maintainable and the suit should have been filed in a revenue Court as provided for under the 1 .and Revenue Code, if the receiver was aggrieved by the sale and that the civil suit was barred by the provisions of sections 157 and 192 of the Land Revenue Code. It may be mentioned that the suit was filed by the receiver to set aside the sale on the ground: (1) the proceedings started against the original occupant and not against the receiver, were without jurisdiction and void ab initio (2) No demand was made before putting the property to sale (-3) THEre was no attachment as required by law (4) THE sale proclamation was illegal as it did not specify the area to be sold and the name of the receiver who was then the occupant and it was not proclaimed as required by section 24, Berar Land Revenue Code: and (5) No proceedings for recovery could be taken against the receiver or against any property in his possession without the leave of the Bombay High Court which appointed him. THE Supreme Court first considered the question as to the effect of not obtaining the leave of the Court and observed: -

(2.) THE Supreme Court then went into the question on the assumption that the sale held without the leave of the Court and without notice to the receiver is only voidable and can be declared as illegal whether there is anything in the Berar Land Revenue Code, which bars the filing of a suit for setting aside the sale on the grounds mentioned earlier. After referring to the provisions in that Code, the Supreme Court held that the suit did not raise any ground which is covered by the specific provisions of the Code for setting aside the revenue sale and the suit being not one simpliciter to set aside the sale held by the revenue authorities, but a suit for a declaration and a consequential relief of possession. it was maintainable. Ultimately the appeal was dismissed. THE learned counsel for the appellant contended that the Supreme. Court had upheld the setting aside of the sale without relying on any specific grounds for setting aside the sale but simply on the ground that the leave of the Court was not obtained before the revenue sale was held and that therefore the ratio of the judgment should be taken as holding that on the very ground of absence of leave of the Court, the sale held under section 69 of the Transfer of Property Act could be set aside. I am unable, to agree with this contention of the learned counsel for the appellant. It is true that the Supreme Court had not dealt with the grounds on which the sale was sought to be set aside, except to consider the question as to the effect of not obtaining the leave of the Court before proceeding to sell the property. But as already stated the sale was sought to be set aside on more than one ground. One of them was that there was no valid attachment of property and that there was no opportunity for the mortgagor to prevent the sale. THE attachment of properties in a case where the property is in the possession of a receiver, is provided for tinder Order 21, rule 52 of the Code of Civil Procedure, and that was specifically noted by the Supreme Court observing that Order 21, rule 52 of the Civil Procedure Code, requires that where the property is in the custody of any Court or public Officer, attachment shall be made by a notice to such Court or officer. THE Supreme Court also observed:- -the absence of such a notice would not render the sale void ab initio, because the jurisdiction of the Court, or the authority ordering the sale, does not depend upon the issue of the notice of attachment-. This observation clearly shows that the sale held without such a notice is also not void but could be invalidated on any of the grounds known to law at the instance of the receiver. THE trial Court as also the Division Bench of the High Court had set aside the sale on merits on all the grounds mentioned earlier, holding that there was no proper attachment, that there was no valid notice to the receiver and that the permission of the Court appointing the receiver was not also obtained. Before the Supreme Court only certain points were urged and they were alone dealt with by the Court. In the circumstances when the Supreme Court upheld the judgment of the High Court, in my opinion, it shall be deemed to have been upheld on the ground that the merit warranted to set aside the sale and not the mere ground of the absence of leave of the Court which appointed the receiver. In fact, a similar question came up for consideration in the decision reported in Veerappa Chettiar v. Md. Mytheen Mana Pillai , before the Division Bench of this Court and the decision of the Supreme Court was also relied on. That was also a case of a sale though by execution through Court but during the period when the property was in the custody of the receiver appointed by another Court. This Court observed: -