NARAIN DAS Vs. ALLA UDDIN KHAN

JUDGEMENT

(1.) These are two applications for leave to appeal to His Majesty in Council against an order of this Court, dated 3 May 1944, by which it remanded the case to the Court below with the direction that a certain application, presented by the judgment-debtors, be restored to its original number and tried according to law. The facts briefly are these: On 27 October 1921, Alla Uddin Khan and Sayeed Uddin Khan granted a simple mortgage in favour of Narain Das and others for a sum of Rs. 10,000. The suit was brought on the basis of that mortgage and, on 15 February 1932, a preliminary decree was passed. The final decree followed on 31 July 1933, for a sum of Rs. 26,759-15-0. In execution of this decree, on 24 January 1934, three houses and eight shops belonging to the mortgagors were sold and purchased by the decree-holders themselves for a sum of rupees 15,325. On 2l January, 1934, i.e. three days before the auction-sale, an injunction had been issued, at the instance of one Mt. Nausani Begam against the auction-sale and an order was passed by this Court at 12 30 P.M. on 24 January 1934, directing the Amin not to proceed with the sale. The case of the decree- holders is that the sale took place at 1 P.M. in ignorance of this order. It is difficult to believe this story, but for the purpose of these applications we shall assume that this was so. On 15 November 1934, the injunction issued in favour of Mt. Nausani Begam was discharged and thereafter the remaining property of the mortgagors was sold on 11 May 1935, and was purchased again by the decree- holders themselves for a sum of Rs. 5,600.

(2.) An application under Order 21, Rule 90, Civil P.C., was presented by the judgment-debtors for setting aside the sale on the ground, inter-alia, that the sale had taken place after an injunction prohibiting the sale had been issued and an application was also made by them for the amendment of the decree and for certain other reliefs under the U.P. Agriculturists Relief Act (Act 27 of 1934). The story of the judgment-debtors that the auction-sale had been made not in ignorance of the order, but in spite of it, was not absolutely devoid of truth. They, however, did not pursue the matter further, but entered into a compromise with the decree-holders on 24 August 1935, which provided that, on payment of a sum Rs. 25,500 in certain specified instalments within six months, the sales of 24 January and 11 May 1935, would be vacated and the decree would be deemed to be satisfied, but in default of such payments the sales would be deemed to be confirmed. There was the usual default. But before the expiry of six months the mortgagors made an application under Section 4, U.P. Encumbered Estates Act, which was, in due course, transmitted to the Special Judge, 1 grade, Pilibhit. During the pendency of this application, an application was made by the mortgagees for the confirmation of the sales and for grant of sale certificates. The Special Judge held that the application under the Encumbered Estates Act was not maintainable and by an order, dated 3l July, 1936, he, acting as a Civil Judge, confirmed the sales and granted sale certificates. The High Court by its order of 23 August 1937, set aside this order on the ground that the Special Judge had no jurisdiction to disallow the application under Section 4, Encumbered Estates Act and during the pendency of the proceedings under this Act he had no jurisdiction to confirm the sales or to grant certificates. The proceedings under the Encumbered Estates Act were finally quashed by the Collector, but before any order could be passed by him the Stay of Execution of Decrees Act had come into force and by virtue of the operation of that Act the proceedings in relation to execution of the decree or the confirmation of the sale remained in abeyance till December 1940, when the Act ceased to be in operation.

(3.) On 7 January 1941, an application was made by the decree-holders to revive their previous application for confirmation of the sales and for grant of certificates and during the pendency of this application, an application was also made by the -judgment-debtors on 17 March 1941, for amendment of the decree under Section 8, U.P. Debt Redemption Act. The decree-holders contended that there was default on the part of the judgment-debtors in carrying out the terms of the compromise of 24 August 1935, and on the expiry of the period provided, the auction sales should be deemed to have been automatically confirmed. The judgment-debtors, on the other hand, contended that they were entitled to an amendment under Section 8, U.P. Debt Redemption Act, notwithstanding the terms of the decree. The learned Civil Judge found that the judgment-debtors were agriculturists within the meaning of the U.P. Debt Redemption Act and that the declaration given by the decree-holders was ineffective against them and they were entitled to the amendment of the decree. He also found that one of the sales was irregularly held at a time when an injunction was outstanding against the sale of the property, but any irregularity about the sale was cured by the subsequent compromise between the parties and in terms of the compromise the sale had to be confirmed. Finally, he found that as a result of the auction sales the decree-holders should be deemed to have received Rs. 20,925 and as this amount exceeded the sum which would have been due to the decree-holders under the decree after the amendment in accordance with the provisions of the U.P. Debt Redemption Act, the decree-holders had recovered more than what was due to them and consequently the decree must be deemed to be satisfied and the decree-holders were not entitled to recover anything more from the judgment-debtors. But, at the same time, as no refund could be ordered against the decree-holders for any excess realisation, he did not grant the judgment-debtors prayer for the amendment of the decree. In the result, the learned Civil Judge granted the sale certificates to the decree-holders and also declared the decree to have been satisfied. The judgment-debtors preferred two appeals to this Court. The sole question which invited the consideration of this Court was whether, under the terms of the compromise in the event of default and on the expiry of the period provided, the auction-sales must be deemed to have been automatically confirmed or an order of confirmation of sales was necessary. This Court held that an express order of confirmation was a condition precedent to the confirmation of the sales even though the decree was based upon a compromise. In this view of this case, the judgment-debtors were entitled to the benefit available to them under Section 8, U.P. Debt Redemption Act, and to an ascertainment by the Court of the amount due to the decree- holders under the amended decree. In summing up its conclusions this Court observed as below :. The U.P. Agriculturists Belief Act and the U.P. Debt Redemption Act have been enacted to relieve agricultural indebtedness and drastic provisions have been introduced in these statutes interfering with the contract between the parties in order to grant relief to agriculturist judgment, debtors. The object of these statutes will be seriously interfered with, if not defeated, by holding that although a new decree can be substituted and a decree can be amended, yet, if the sale had taken place but had not been confirmed, the Court has no power to refuse to confirm the sale and the relief granted by the new decree or by the amendment of the decree should remain ineffective. Whatever may have been the legal position before the debt legislation we are of opinion that if a decree is amended under the provisions of the debt legislation which has been enacted for the relief of the agriculturist, it should be open to the Court in a proper case to refuse to confirm the sale on grounds other than those specified in Order 21, Rule 92, Civil P.C. And, finally, this Court sent the case back to the Court below with the direction that the application of the judgment-debtors under Section 8, U.P. Debt Redemption Act, be restored to its original number and the amount duo to the decree-holders under Section 8, U.P. Debt Redemption Act, be ascertained and the decree be amended and after the decree has thus been amended, execution should proceed in due course of law. There are two questions which really fall for consideration. In the first place, is it a final order, finally deter-mining the rights of the parties in the sense that the execution is no longer a live execution? Assuming that the order answers this test, has the matter been settled by any judicial pronouncements of their Lordships of the Privy Council? If the answer is in the affirmative, the applicants are not entitled to leave, because the matter will then cease to involve a substantial question of law of general importance. Section 109 (a) or Section 110, Civil P.C., has, as a result of judicial pronouncements, no application to the present case. It must stand or fall on an interpretation of Section 109 (C). The applications have been headed as applications under both the provisions of law. The learned Counsel for the applicants has strenuously contended that in so far as the auction-sales have been set aside, there is a final adjudication upon the rights of the parties, and he takes his stand principally on Krishna Pershad Singh V/s. Moti Chand ( 13) 40 Cal. 635 and Rahimbhoy Habibbhoy V/s. C, A. Turner ( 91) 15 Bom. 155. The case in Krishna Pershad Singh V/s. Moti Chand ( 13) 40 Cal. 635 is undoubtedly in favour of the applicants as far as it goes, but it does not go the whole length of their contention. That was a case where a judgment-debtor had prayed for the setting aside of the sale and the trial Court had acceded to his prayer, but the High Court, on appeal, took different view. The auction-sale was vitiated, according to the judgment of their Lordships of the Judicial Committee, by grave irregularities which had caused prejudice to the rights of the minor. This was obviously the main consideration which weighed with their Lordships. And, beyond the auction-sale-which was either to be set aside or confirmed-there was nothing else to be done. To this aspect of the matter we shall advert presently. The ratio underlying Rahimbhoy Habibbhoy V/s. C.A. Turner ( 91) 15 Bom. 155 is also the same. The case in Kishan Chand V/s. Lachmi Chand has also been relied upon. That case is only authority for the proposition that a final order within the meaning of Section 109, Civil P.C. need not be a final order passed in the suit itself, but may be a final order in any other proceeding or case arising subsequent to the suit.