UMADAI RAJA RAJAI DAMARA KUMARA THIMMA NAYANIM BAHADUR VARU RAJA OF KALAHASTI Vs. SRI RAJA VELUGOTI SRI RAJAGOPALA KRISHNA YACHENDRA BAHADUR VARU, KCIE, MAHARAJAH OF VENKATAGIRI

JUDGEMENT

(1.) This appeal is against an order of the District Court of North Arcot refusing to set aside the sale of a village Chintapalli held in the execution of a mortgage decree. The mortgagor Judgment-debtor is the Rajah of Kalhasti, and the mortgagee is the Maharajah of Venkatagiri. The purchaser at the Court sale is the Rajah of Tuni. Subsequent to the mortgage which was the subject of the decree, the mortgagor entered into a transaction of exchange with one Narasimha Rayanimgar by which Chintapalli was given to Narasimha in exchange for some other property. Under the terms of the instrument of exchange the mortgagor was entitled in addition to the village received by him in exchange to an annual sum of Rs. 507-2-9 . from the income of the Chintapalli yillage. This arrangement was apparently made in order to compensate the mortgagor for the difference in value between Chintapally and the village given by him in exchange for it. The suit and the decree on the mortgage were subsequent to the exchange, but the mortgagee was of course not bound by the exchange. Narasimha Raynimgar, to whom the equity of redemption had passed under the exchange transaction, was not a party to the suit on the mortgage. It may be mentioned in passing that there were several other items of property comprised in the mortgage and the decree passed thereon. In execution of the decree, the mortgagee realised the greater part of the money due to him by the sale of other properties; he then brought to sale Chintapally village for the recovery of the balance. In the application for sale proclamation to be settled by the Court under Order 21,, Rule 66, the decree-holder stated the revenue payable on the village to be Rs. 188-11-10, and estimated its market value at Rs. 2,800. There seems to have been some objection raised to the draft of the sale proclamation, and the Judgment-debtor was called upon to give his own estimate of the value of the village. He stated that the value was, Es. 9285 calculated at 15 times the average annual gross income of Rs. 619. It is not disputed that both the decree- holder and the Judgment debtor were quite mistaken with respect to the value that each gave of the village. The cause of the mistake was clearly this : the decree-holder acted on the footing that what was to be sold in execution of the decree was the mortgagor s right, title and interest as it existed at the time of the sale. This right, it would be observed, was only a rent charge of Rs. 507-2-9 a year in consequence of the transaction of exchange which took place subsequent to the mortgage. As a matter of fact the mortgagee was entitled to bring to sale the mortgagor s right in the village as it stood at the time of the mortgage. Whether the mortgagee was under the mistaken impression that he was entitled to sell only the mortgagor s equity of redemption as it then stood or whether an account of his having omitted to make Narasimha Rayanimgaru a party to the suit as he was bound to do under Section 85 of the Transfer of Property Act, he contented himself with bringing the equity of redemption to sale, is not quite clear. It is, however, certain that the Judgment debtor in giving his own valuation and in stating the annual income and revenue of the village also proceeded on the footing that the mortgagee intended to bring to sale only his rent charge over the village. He calculated the value at 15 times the gross annual income, he took the rent charge and the land cess which was also payable by Narasimha Rayanimgar to the mortgagor to be the annual income and the peishcush which appears to have been calculated at one-third of the rent charge, in accordance with the usual estimate made of the proportion borne by the peishcush to the actual income, was stated to be Rs. 188-11-10 the same figure as had been adopted by the decree-holder. The right of the defendent in the village to be brought to sale was described as " defendant s ayan interest." The expression " ayan interest," would apparently be consistent with the interest of the defendant as it stood at the time of the mortgage or at the time of the sale. What the words other interest mean is not quite clear. Possibly they were put in to denote that all the right title and interest of the debtor was to be brought to sale; but this again is consistent with the intention that what was to be sold should be the right mortgaged by the Judgment-debtor to the plaintiff in the suit or the interest of the mortgagor as it stood at the time of the sale. The price fetched at the auction sale was Rs. 7950. The Judgment- debtor applied under Order 21, Rule 90, to set aside the sale.

(2.) The application proceeded on the basis that the sale proclamation would have the effect of passing to the purchaser the entire right of the mortgagor as it stood at the time of the mortgage to the plaintiff. The application was not opposed by the decree holder, but it was resisted by the purchaser, who maintained that what was sold to him was what was mortgaged to the plaintiff and not merely the rent charge which the Judgment-debtor had at the time of the sale. The District Judge has also proceeded on the view that the entire right in the village was sold by it and passed to the purchaser. The arguments in appeal have also proceeded on the same footing. It will be observed that in this view the auction-purchaser would not have a safe title, as Narasimha Rpyanimgaru, who had a substantial interest in the village at the time of the suit, was not made a party to it, but the purchaser is apparently prepared to take the title to the village with this defect. It is not disputed that the price fetched at the auction sale must be regarded as very much less than the real value of the village. In his petition, the Judgment-debtor stated that the annual gross income of the village was about Rs. 4,000 and that the value will be about Rs. 60,008. His clerk, the first witness at the enquiry held by the Judge, said that the annual beriz of the village was Rs. 2,000. The 2nd witness another clerk, stated that Narasimha Rayanimgaru had after the exchange spent about Rs. 4,000 in improving the village. The karnam of the village the third witness gives Rs. 8,400 as the average annual income. The figures given by these witnesses are disputed by the auction-purchaser, and he relies upon a statement made by the Judgment-debtor at an earlier stage of the proceedings that the annual income was not less than Rs. 1,200. The value of the village would then be about Rs. 1.8,000 taking the gross income for 15 years to represent the market value. It is at any rate clear that the price fetched at the sale was much less than the market value of the village. The petitioner requested the lower court for an adjournment to examine two witnesses who did not attend at the hearing; but the District Judge refused the adjournment; as in the view he took of the case there was no defect or irregularity in the publication and conduct of the sale, and it would be useless for the petitioner to prove that sale was made for a grossly insufficient price.

(3.) The learned vakil for the purchaser does not seriously contend before us that Rs. 7,950 would be an adequate price for the village, his argument being that the sale cannot be set aside as there was no irregularity in publishing and conducting it. The District Judge s order refusing to set aside the sale is based on the ground that the Judgment-debtor is estopped from objecting to the statements contained in the sale proclamation regarding the peishcush and the value of the village and from seeking to set aside the sale on the ground of the incorrectness of these statements. Mr. Ramesam on behalf of the purchaser maintains that this view is correct. Order 21, Rule 66 lays down that "the proclamation of sale should specify as fairly and accurately as possible. (b) the revenue assessed upon the estate. (c) every other thing which " the courts consider material for a purchaser to know in order to judge the nature and value of the property." It is not incumbent upon the court to state the value of the property in the sale proclamation. It is not denied that a materially incorrect statement of the revenue or of the value of the property where the value is stated would constitute an irregularity which if it caused substantial injury to the debtor, would entitle him to have the sale set aside.