BHAGWANDAS Vs. K G PURUSHOTHAMAN

JUDGEMENT

(1.) THE first of these appeals arises out of C.S. No. 129 of 1982 filed by respondents 1 to 4 therein while the other appeal is against C.S. No. 492 of 1982 filed by the appellant therein. It is convenient to refer to the parties by their rank in C.S. No. 129 of 1982. THE plaintiffs are four in number. Plaintiffs 3 and 4 are sons of the first plaintiff. THE second plaintiff is a partnership firm, whose partners were originally the first plaintiff and his mother Jagadambal Ammal who died on 13-10-1980. According to the deed of partnership, the firm does not get dissolved by the death of a partner, but the heirs of such deceased person would get into the shoes of the deceased. According to the plaintiffs, the interest of Jagadambal Ammal was bequeathed by her registered will dated 21-6-1971 to plaintiffs 3 and 4. THE subject matter of dispute is a property comprising land of an extent of 3 grounds and 726 sq. ft. and a superstructure thereon situated in No. 23, Miller's Road, Kilpauk, Madras-10. THE first plaintiff was the owner of the said property and also of the adjacent properties having obtained the same under a deed of gift settlement executed by his father on 28-9-1963. He sold the adjacent properties to his father in 1970 and retained the suit property. He leased the land to the second plaintiff partnership firm on 24-1-1970 for the purpose of putting up buildings and doing business of letting out the same to tenants and realising rents therefrom. Though it is said that the building was put up thereafter, there is evidence on record to show that major portion of the building was constructed even in 1969 by the first plaintiff after obtaining permission from the Corporation of Madras. Some additions would appear to have been made in 1970. THE firm had incurred several debts and executed mortgages. In Order to discharge the same, plaintiffs 1 and 2 along with Jagadambal, the first plaintiff's mother, executed a simple mortgage on 18.1.1980 in favour of the first defendant for a sum of Rs. 55,000/- borrowed from him. On the same day, a second mortgage was executed by the same persons in favour of the second defendant, who was a minor, represented by her father, for a similar sum of Rs. 55,000/- borrowed from her. A third mortgage was also executed on that date in favour of the third defendant for a sum of Rs. 40,000/-. All the three simple mortgages contain clauses conferring power of sale on the mortgagees under Section 69 of the Transfer of Property Act, 1882. THE mortgagors committed default in payment of interest and notices were issued by the mortgagees calling upon the mortgagors to pay the amounts due. In June 1981, the mortgagees entrusted the relevant documents to Auctioneers by name Murry & Co., the fourth defendant in the suit, with a request to advertise sale of the premises in public auction. THE fourth defendant sent letters to the plaintiffs in the beginning of June 1981 informing them that the property will be sold in public auction as per the instructions of the mortgagees. It appears that the mortgagors paid the arrears of interest and defendants 1 to 3 instructed the fourth defendant that they were withdrawing the notices with a view to give one more chance to the plaintiffs to pay the interest regularly and instructed them not to proceed further. THEre was further default on the part of the plaintiffs and a notice was issued on behalf of the defendants to plaintiffs 1 and 2 calling upon them to pay the entire amount due forthwith and informing that in default the property would be brought to sale without the intervention of Court (Vide Exs. P-7, P-8 and P-9). As there was no compliance, the fourth defendant was instructed by defendants 1 to 3 to advertise and sell the property. THE fourth defendant sent letters on 11-12-1981 to the plaintiffs informing them of the proposed public auction. Acknowledging receipt of the said letters, the first plaintiff sent a reply on 20-12-1981 (Ex. D-14) stating that he would arrange to settle the entire amount to the mortgagees and prayed for 15 days' time to do so. He sent copies of the said letter to defendants 1 to 3. But he did not make arrangements to settle the dues, though he paid some amounts towards interest due. On behalf of defendants 1 to 3, a letter was sent by the second defendant's guardian on 21-1-1982 to plaintiffs 1 and 2 informing them that the papers would be place d with the auctioneers for holding a public auction (Ex. P-13). As there was no compliance with the said notice, the fourth defendant printed auction notices and sent copies thereof to the plaintiffs in February 1982. THEre was proclamation by torn in the property on 2-2-1982. THEre was also advertisement in "THE Hindu" and "Dhina Thanthi". THE auctions were to be held on 17-2-1982, 18-2-1982 and 22-2-1982 in pursuance to the first mortgage, second mortgage and the third mortgage respectively.

(2.) ON 17-2-1982 the auction was not held as there was no bidder. According to the defendants, the plaintiffs sent their henchmen to the place of auction and prevented any person from entering the premises to take part in the auction, which necessitated a complaint to the police by the defendants. It is also the case of the defendants that on 18-2-1982 they had arranged for police protection and on seeing the police officials, the plaintiffs' men did not attended any person from taking the auction. It is also the case of the defendant that several persons came to the premises, only three of them took part in the bid. The belated started at Rs. 3,00,000/- and there was keen competition among the three bidders. Ultimately, the fifth defendant was proved to be the highest bidder for a sum of Rs. 6.80,000/-. As per the conditions of auction, he paid a sum of Rs. 1,70,000/-, being 25% of the bid amount. The balance was to be paid within 15 days therefrom.

(3.) THE application for injunction, viz., Application No. 798 of 1982, was contested by the defendants and a final order was passed in that application on 27-4-1982. By the said order, the plaintiffs were directed to pay to the mortgagees a sum of Rs. 1,60,000/- plus Rs. 5,000/- as interest for two months period as condition for injunction on or before 3-6-1982 in addition to the auction charges to the satisfaction of the auctioneers. THE order made it clear that if the conditions were not complied with, the injunction granted therein shall stand vacated. THE order also permitted the auction purchaser to withdraw the amount deposited with the auctioneers i.e., Rs. 1,70,000/- without prejudice to his rights. THE plaintiffs did not comply with the condition imposed by the said order. On 6-7-1982 defendants 1 to 3 wrote to the fifth defendant to deposit the sale price with the fourth defendant the order of injunction passed by the Court stood vacated. Accordingly, the amount was deposited. THE fifth defendant informed the fourth defendant that he was nominating his son the 6th defendant as the purchaser in whose name a sale deed could be executed. THEreafter, the sale deed (Ex. D-50) was executed on 24-7-1982 by the second defendant in favour of the 6th defendant for a total consideration of Rs. 6,80,000/. THE same was intimated to the plaintiffs. It was followed by a notice from the 6th defendant's lawyer (Ex. P-28) to plaintiffs 1 and 2 calling upon them to deliver vacant possession of the premises. A reply (Ex. P-29) was sent by the plaintiffs contending that the sale was not valid and binding on the plaintiffs. THE 6th defendant thereafter filed the suit C.S. No. 492 of 1982 on 24-9-1982 for directing the plaintiffs to deliver vacant possession of the property and pay mesne profits in a sum of Rs. 10,500/- from 24-7-1987 to the date of plaint and at the rate of Rs. 7000/- per mensem from the date of plaint till the date of delivery of possession.