HALIMANNISSA CHOWDHRANI Vs. SECRETARY OF STATE FOR INDIA

JUDGEMENT

(1.) This is an appeal on behalf of the plaintiff in a suit instituted by her under Section 33 of Act XI of 1859, for the reversal of a sale, held under that Act pursuant to the provisions of Section 11 of Act VII of 1868 (B.C.). The plaintiff alleges that she is the proprietor of what is described in these proceedings as dakhal No. 1, situated in Government khas mehal Char Gazi, that she defaulted to pay the rent and cesses due on account of the August instalment of 1900, that the property having been advertised for sale, her agent offered to deposit the arrears before the sale, but the Collector, acting under the last paragraph of Section 6 of Act XI of 1859, refused to receive the money, and that consequently the property was sold and purchased by the Collector on the 18 December 1900 for Rs. 10 under Section 58 of Act XI of 1859. The plaintiff appealed to the Commissioner, but her appeal was dismissed on the 1st March 1901. The plaintiff accordingly sues to set aside the sale on the ground that it has been made contrary to the provisions of (Act XI of 1859 and Act VII of 1868 (B.C.), and that she had sustained substantial injury by reason of this irregular sale under which her property, worth Rs. 1,100, had been transferred to the Collector for Rs. 10. The learned District Judge has held that the sale took place in conformity with the provisions of the Revenue Sale Law, that there-had been no such irregularities in, the publication of the prescribed notices and in the conduct of the sale as would vitiate it, and that consequently although the plaintiff had suffered substantial loss, she was not entitled to ask for a reversal of the sale. The learned District Judge has accordingly dismissed the suit, and against his decree the plaintiff has appealed to this Court.

(2.) On behalf of the plaintiff-appellant, the decision of the learned District Judge has been assailed on various grounds, which it is not necessary for us, in the view we take of this matter, to discuss In detail. In our opinion the sale in this case ought to be annulled on the ground that it has not been held in accordance either with the letter or the spirit of Section 58 of Act XI of 1859. The facts, so far as they bear upon this question, are practically undisputed, and may be briefly stated. This very property was put up to sale on the 14 March 1900, by reason of default of payment of a previous instalment of rent; the Collector began with a bid of one rupee the defaulter followed with a bid of ten rupees; there was no other bidder, but the offers rose till the Collector stopped at Rs. 800, and the property was knocked down to the agent of the defaulter for Rs. 805. On the occasion of the sale of the 18 December 1900, which was held after the refusal of the Collector to receive the full amount of arrears tendered, and which is impeached in then present suit, the Collector began with a bid of one rupee; the agent of the defaulter followed with a hid of ten rupees; there was no other, bidder, hut the Collector enquired whether any one was willing to increase the hid: as no one came forward, the Collector forthwith closed the bid, and declared that he had purchased the property on account of the Government, at the bid of ten rupees under Section 58 of the Revenue Sale Law, inasmuch as that bid wan, insufficient to cover the arrears realizable. We are of opinion that the procedure adopted by the Collector is not in accordance with the provisions of Section 68, which provides for purchase by the Government at a revenue sale in two classes of oases.

(3.) The section first provides that if there he no bid when an estate is put up for sale under the Act, the Collector may purchase the property on account of the Government for the rupee; this clearly implies that the Collector is himself not to bid in the first instance, that he is to ascertain whether there are any bidders for the property, and it is only when no one offers any bid that the Collector may purchase the estate for one rupee. The section then goes on to provide in" the second place that when there are bidders but the highest bid is insufficient to cover the amount realizable, the Collector may take or purchase the estate on account of the Government at the highest amount bid. We are of opinion that the highest bid, here referred to, is one not arrived at by competition between the Collector and the ordinary bidders. It appears to be clear that, as in the first class of -oases, the Collector is to take no action till he has ascertained that there are no bidders, so also in the second class of oases the Collector is to take no action till he has ascertained that the highest amount offered by the bidders present is insufficient to cover the amount realizable. We do not think it would be a reasonable construction of Section 58 to hold that it is open to a Collector to compete with the other bidders and after he has been defeated and the highest bid determined against him, that he may turn round and claim the benefit of the second part of Section 58. If the Collector chooses to enter the ring as an ordinary bidder, he must be treated as such, and in order to succeed, he must outbid the other intending purchasers. If on the other hand, he desires to take advantage of the second part of Section 58, he must wait and see -whether the highest bid is or is not sufficient to cover the demand realizable. In the case before us, the first bid of one rupee offered by, the Collector was clearly not one under the first part of Section 58, inasmuch as there was at least one person, the agent of the defaulter, ready to offer bids. When therefore the second bid of Rs. 10 was offered, if the Collector desired to purchase the property, the only course open to him was to advance his own bid, like any ordinary bidder. "We must hold accordingly that the procedure followed by the Collector and the purchase made by him were not in accordance with the provisions of Section 58 of the Revenue Sale Law.