S. NATARAJAN Vs. AMIRTHASAMY AND ANR.

JUDGEMENT

(1.) This Civil Miscellaneous Second Appeal arises out of an order made in an application filed under Order 21, Rule 90, Code of Civil Procedure. The judgment - debtor-defendant is the appellant. In execution of a money decree, the first respondent decree-holder brought certain properties of the appellant to sale. The sale was held on 9th April, 1973 and the second respondent was the highest bidder for Rs. 7,505 subject to two security bonds of Rs. 15,000 each over the property. The sale warrant was issued for a sum of Rs. 7,500. In the sale warrant, the property is described only by boundaries and stated to be comprised in T.S. No. 2292 of Ward No. 1 of Thanjavur municipality. The appellant presented on 5th June, 1973, Execution Application No. 537 of 1973, under Order 21, Rule 90, Civil Procedure Code, praying to set aside the sale on the ground, amongst others, that though the property within the boundaries mentioned in the sale proclamation comprised two survey numbers, only one survey number had been mentioned in the sale proclamation. The sale proclamation also neither gave the total extent of the site nor the north to south and east to west measurements of the same. Within the boundaries mentioned there were also four shops in addition to the groundnut decorticating mill, rotary oil mill and rice huller. But these shops had not been specifically referred to in the sale proclamation. There is also a well in the property which has not been mentioned. The monthly rental, according to the learned Counsel for the appellant, received from this property was Rs. 700 and that is being collected by the Deputy Commercial Tax Officer towards arrears of sales tax. The appellant h -d contended in that application that because of these material defects in the description of the property, the property had been sold for a very low price of Rs. 7,505 subject to the two encumbrances of Rs. 15,000 each. He had also stated, that even the amin who inspected the property some time in July, 1972 had Valued the property at more than one lakh of rupees. The learned Counsel for the appellant had also pointed out that under Order 21, Rule 66, Civil Procedure Code, it is incumbent on the decree-holder to verify and file a statement verified in the manner prescribed containing the matters required by Sub-rule (2) of that section and he had not cared, to say the least, to give the correct description of the property in his execution petition and also in the statement filed under Order 21, Rule 66 (3), Civil Procedure Code, which has resulted in the inadequate and imperfect description of the property which in turn resulted in fetching an inadequate price at the sale. On these grounds, the appellant filed the application for setting aside the sale. As already stated, the application under Order 21, Rule 90, Civil Procedure Code, was presented on 5th June, 1973. On 26th June, 1973 the appellant also presented another application, E.A. No. 538 of 1973 praying to accept as security the property comprised in T.S. Nos. 2292 and 2871 measuring an extent of 7 grounds and 53 sq.ft. Along with this application he also filed a draft security bond. The appellant served copies of these affidavits and petitions on the first respondent-decree-holder on 9th July, 1973. On 12th July, 1973 the trial Court numbered both these applications as E.A. Nos. 537 and 538 of 1973 and directed notice to the auction purchaser alone as the decree-holder respondent had already been served. In E.A. No. 538 of 1973, which was an application to accept the security, he made an order directing the testing of the security bond and posted it to 3rd August, 1973. The second respondent filed a counter on 3rd August, 1973 and ultimately both these applications, E.A. Nos. 537 and 538 of 1973, were taken up for hearing on 14th August, 1973. On that day, the learned District Munsif dismissed E.A. No. 538 of 1973 holding that the appellant had furnished only the property that was sold as security and that therefore the security could not be accepted. In E.A. No. 537 of 1973 he made an order to the effect that since E.A. No. 538 of 1973 filed to accept the security of immovable property has been dismissed that petition also has to be dismissed. The appellant filed an appeal as against the order in E.A. No. 537 of 1973 before the learned Subordinate Judge of Thanjavur in C.M.A. No. 87 of 1974. In that appeal he challenged the rejection of his application to accept the security furnished by him and further contended that he was not liable to furnish security. He also contended that the order dismissing the petition under Order 21, rule go, Civil Procedure Code, is liable to be set aside as it did not deal with the merits. The learned Subordinate Judge did not give any finding as to whether the appellant was liable to furnish security or whether the security furnished by him should be accepted as sufficient security. Without stating anything with regard to the acceptability of the security or the need for the security he purported to dispose of the appeal on the merits and held that the sale is not affected by any material irregularity or fraud in publishing or conducting the sale.

(2.) In this appeal, the learned Counsel for the appellant submitted that the finding of the learned District Munsif that the appellant is liable to furnish security and the security offered by him could not be accepted is contrary to law. He also argued that the sale itself is liable to be set aside on the ground of material irregularity or fraud in publishing and conducting the sale. The learned Counsel further contended that since the proclamation did not contain the correct and full description of the property, the sale itself was illegal.

(3.) On the first question as to whether the appellant is liable to furnish security under Order 21, Rule 90, Civil Procedure Code, and whether the security furnished by him ought to have been accepted, the submission of the learned Counsel was this. Under the first proviso to Order 21 Rule 90, Civil Procedure Code, the Court may, before admitting the application, call upon the applicant either to furnish security to the satisfaction of the Court for an amount equal to that mentioned in the sale warrant or that realised by the sale whichever is less or to deposit such amount into Court. The learned Counsel relied on the words "before admitting the application", in this proviso, and contended that the learned District Munsif had not directed him to furnish the security before admitting this application for setting aside the sale and that therefore he was not even liable to furnish security. In this connection he relied on the numbering of the petition filed under Order 21, Rule 90, Civil Procedure Code on 12th July, 1973 and issuing of the notice to the auction-purchaser as amounting to admission of the application. He relied on a decision of this Court Vaidyanatha Ayyar v. The Indian Bank Ltd., 1955 AIR(Mad) 486 in support of this contention that the numbering and issuing of notice on 12th July, 1973 amounted to admitting the application for setting aside the sale. In that case it was held, after a consideration of the earlier decisions that though the numbering of the petition is really an act of the ministerial officer of the Court, when notice is ordered to go on that application, it normally means that the Court had applied its mind to the petition and decided to hear the petition from the opposite side. The issuing of a notice under such circumstances would be cogent evidence that the petition has been admitted. But the learned Judges hastened to add that there may be cases where, notwithstanding the fact that notice had been ordered to issue it may be clear that such a result was not intended. Therefore the question whether the application had been admitted or not would have to be considered with reference to the facts and circumstances in each case. The question for consideration is whether there are any circumstances in this case sufficient to rebut the inference that normally flows from the issue of a notice in order to hold that the Court had not admitted the application in this case. As we have already noticed both the application for setting aside the sale and the application to accept security were presented by the appellant and they were pending before the Court before they were numbered on 12th July,' 1973. The notice to the decree-holder was given by the appellant himself and not by any order of Court. The direction to issue a notice by the Court on 12th July, 1973 was only to the second respondent auction-purchaser. Further on the same day when he made that order, the learned District Munsif had also directed, in the application to accept security the testing of the security bond and posted the matter for 3rd August, 1973. In these circumstances, the Court could not have intended by admitting the application on 12th July, 1973 to have the effect of debarring the Court from requiring the security to be furnished in order to deal with the application on merits. Even so, the learned Counsel for the appellant submitted that the trial Court ought to have accepted the security offered by him and if it was not willing to accept that security offered by him it should have directed fresh security to be furnished instead of dismissing it without giving him an opportunity to furnish security. The first question for consideration is whether the security furnished by him ought to have been accepted. As already stated the appellant sought to furnish security of two survey numbers. T.S. Nos. 2 : 292. and 2871, measuring a total extent of 7 grounds 54 sq. ft. There are four shops, a groundnut decorticating mill, a rotary oil mill and a rice huller within this property. The learned District Munsif dismissed this application on the ground the property offered as security is the property sold and that therefore it could not be accepted. There is nothing in the first or the second proviso to Order 21, Rule 90, Civil Procedure Code, which prevents the Court, if it is considered sufficient, from accepting the property sold as security. Under the first proviso, the applicant has to furnish security to the satisfaction of the Court for an amount equal to that mentioned in the sale warrant or that realised by the sale whichever is less. In this case, the amount realised in the sale was Rs. 7,505 and that mentioned in the sale warrant is Rs. 2,372-35. Therefore the appellant was liable to furnish security only to the extent of Rs. 2,372-35- Under the second proviso, the security furnished is liable to be proceeded against to the extent of the deficit on a resale of the property brought to sale. That will be only relevant in considering the sufficiency of the security offered and it has no relevance on the question as to whether the property sold itself could be offered as security. In fact, in cases of execution of mortgage decrees, this Court has uniformly held that it is open to the judgment-debtor to offer the property secured as security in an application under Order 21, Rule 90, Civil Procedure Code. The main part of Order 21, Rule 90, Civil Procedure Code, deals with sale of immovable property in execution of a decree. It makes no distinction between a money decree and a mortgage decree. Therefore, in every case the Court will have to consider with reference to the first and second provisos whether the security offered by the applicant is enough security. Only if it considers that the property offered as security is insufficient it can reject that application. The Court below had not gone into the question as to whether the security offered by him is enough security. Having regard to the fact that there are four shops and a groundnut decorticating mill, rotary mill and rice huller in the suit property and the site itself measures an extent of 7 grounds 54 square ft. and having regard to the location of the property near the Thanjavur railway station, it appears to me that the property must be much more valuable than the sum of Rs. 7,505 realised by the sale and Rs. 2,372-35 the amount mentioned in the sale warrant even after providing for the two security bonds of Rs. 15,000 each. Further as rightly pointed out by the learned Counsel for the appellant, though the boundaries described might be construed as including T. S. No. 2871 also specifically that survey number had not been mentioned in the sale proclamation nor the four shops in the property. Therefore the purchaser shall be deemed to have purchased only that portion cover by Survey Number 2292 and the Court below should have considered whether the other survey number 2271 is not sufficient security. The learned c Counsel is also well founded in. his contention that in any case, if the Court below was not : satisfied with the sufficiency of the security it the security it should have directed the appellant to furnish fresh or additional security and should not have dismissed that application in limine. As already , stated, I am satisfied that having regard to the amount mentioned in the sale warrant, the property is enough security which ought to have been accepted by the Courts below.