ORDER
A. Gopal Reddy, J.
1. This appeal arises from an order passed by the Senior Civil Judge, Kowur dated 20-4-2000 in EA No. 1020/99 in EP No. 46/98 in OS No. 192/87 dismissing the application filed under Order 21 Rule 90 read with Section 151 CPC by the 6th judgment-debtor.
2. The appellant herein is the petitioner-6th judgment-debtor in the above application.
3. EA No. 1020/99 was filed by the 6th judgment-debtor seeking to set-aside the auction sale conducted on 17-11-1999 in EP No. 46/98, filed for execution of the decree passed in OS No. 192/87. The first respondent-decree-holder/Bank filed EP for due recovery of the decretal amount by sale of mortgaged property, in which, the appellant-6th judgment-debtor was served with a notice. He filed a counter raising certain objections that the Court Amin undervalued the property, which has been overruled and posted EP for settlement of terms. The terms were settled on 22-9-1999 fixing the date for sale on 17-11-1999. The proclamation, containing the terms of settlement, was drawn on 22-9-1999 that the order proclaiming sale shall be made by way of beat of torn torn and also shall be affixed near the place where the property was ordered to be sold is situated. Accordingly, the Process Server has given endorsement that proclamation has been affixed to the house on 2-11-1999 and said proclamation was made by beat of torn torn near the property which is brought for sale and torn torn receipt dated 2-11-1999 was filed, which was attested by two persons. Later the proclamation of sale was published in Praja Sakthi Newspaper on 5-11-1999 stating that the sale is to be held on 17-11-1999 and sale was conducted on the said date for a sum of Rs. 7,15,000/- and same was confirmed in favour of the second respondent-auction purchaser. Before confirmation of sale, appellant herein filed EA No. 1020/99 contending that sale is vitiated on the ground that proclamation has not been made within 15 days; there was no beat of torn torn in the vicinity of the property and there was no attestation of the neighbours in the receipts filed in the Court; proclamation was not properly published in the Nagara Panchayat, Kowur; publication is defective as Amin’s value and the decree-holder’s value including judgment-Debtor’s value are not noted and auction was conducted within 15 days of such publication of proclamation of sale in the news paper, which is short of three days; decree-holder planted three bidders at the time of auction and the second respondent-auction purchaser is having business dealings with the first respondent-Bank and lastly it was pleaded that the value given by the Amin and decree-holder is grossly inadequate; the value of the property ranges between Rs. 12 lakhs to Rs. 14 lakhs and the same was knocked down in favour of the second respondent at a throw away price, therefore the sale is liable to be set-aside.
4. The decree-holder/Bank filed a counter stating that the publication of proclamation of sale is not defective and there is a gap of 15 days from the date of publication of proclamation of sale in the news paper to the date of auction. It is further stated that proclamation was ordered on 20-9-1999 and beat of tom tom and also affixture of notice was taken place on 2-11-1999. The market value of the property is about Rs. 4 lakhs as per the records maintained by Sub-Registrar.
5. The second respondent-auction purchaser filed a separate counter denying the irregularities in conducting auction. It is further stated that proclamation was drawn in accordance with Order 21 Rule 66 CPC. In fact 7 persons were present at that time of auction and participated in the auction. The proclamation contains the value as given by the decree-holder i.e., Rs. 2.75 lakhs and Court Amin Rs. 4 lakhs, whereas the property fetched at auction was Rs. 7,15,000/-, which is more than the value mentioned by the Court Amin and also the decree-holder as well as the Sub-Registrar’s book value. In the absence of any substantial injury caused to the plaintiff is established, sale cannot be set aside.
6. The lower Court on appreciating the material placed on record held that once the judgment-debtor was duly served with a notice and field counter raising an objection that the Court Amin has undervalued the property and the same was overruled and posted the execution petition for settlement of terms and terms were settled on 22-9-1999 fixing the date for sale of property on 17-11-1999, as per endorsement given by the Process Server valid proclamation has been made by beat of torn torn and affixture at the suit house on 2-11-1999 and torn torn receipt is also attested by two persons who witnessed the torn torn, objection that there was no beat of torn torn and affixture of proclamation cannot be accepted. Similarly, the objection that order of proclamation has not been affixed at the Nagar Panchayath, Kovvur has also been negatived stating that proclamation was published in the newspaper as contemplated under the Code of Civil Procedure and same complies with procedure as laid down under Order 21 Rule 67 CPC. The next contention raised by the appellant that publication is defective as it does not contain Amin’s value of the property and also the value of the decree-holder and there is no gap of 15 days between publication of proclamation of sale and date of sale was negatived holding that proclamation contained the value of decree-holder and also the Court Amin and proclamation was drawn containing the value of the decree-holder and the value determined by the Court Amin. Mere non-mentioning of the estimated value by the decree-holder does not vitiate sale and it is not a material irregularity, which does not cause any substantial loss to the appellant. The appellant failed to show how she sustained substantial loss by reason of failure, to mention of Amin’s value and decree-holder’s value in the paper publication. Proclamation contained all particulars, namely, property to be sold, encumbrances if any on the property, the amount required to be recovered by sale etc. However, publication does not contain the value of the decree-holder and the Court Amin, and it is not an irregularity. The judgment-debtor also has not furnished the value of the property ordered to be sold. Further auction proceedings falsify the objection raised by the judgment-debtor that decree-holder planted only three persons as seven persons took part in the auction proceedings and offered their price and finally the second respondent became the highest bidder for Rs. 7,15,000/-. In the absence of any fraud or collusion in auctioning the property or substantial injury has been caused to the appellant, sale cannot be set-aside and dismissed EA accordingly.
7. Learned Counsel for the appellant while reiterating the very same grounds which were not found favour by the lower Court contended that though the property is valued between Rs. 12 lakhs and 14 lakhs the same is sold at Rs. 7.15 lakhs and sale was conducted within 15 days from the date of publication of proclamation of sale in the newspaper, which does not disclose the value of the property given by the decree-holder; Court Amin and judgment-debtor, and the same is not in conformity with the Order 21 Rule 66 CPC, He further contends that under Order 21 Rule 68 CPC no sale shall take place without the consent in writing of the judgment-debtor until after expiration of at least 15 days from the date on which copy of publication was affixed on the Court-house. He further contends that as the Court Amin has not valued the property properly, the appellant has suffered substantial injury and placed reliance on the following judgments :
1. Regi George v. K.K. Bhaskaran Nair
2. Achamma Cyriac v. Kerala Financial Corporation
Lastly, it was argued that when the EP amount is for Rs. 4,56,000/- the entire properly need not be sold and a portion of the property is sufficient, therefore sale is liable to be set-aside and placed reliance on the judgment of the Apex Court in Ambati Narasayya v. M. Subba Rao .
8. On the other hand, learned Counsel for the second respondent-auction purchaser except stating that he is the auction purchaser and lower Court considered all aspects and dismissed EA, has not made any endeavour to sustain the order of the lower Court under appeal.
9. To resolve the controversy, it is appropriate to notice the statutory provision, Order 21 Rule 90 CPC, as it applicable to the State of Andhra Pradesh, which governs setting aside of sale on the ground of irregularity or fraud.
90. Application to set-aside sale on ground of irregularity or fraud.-(1) Where any immovable property has been sold in execution of a decree, the decree-holder, or the purchaser, or any other persons entitled to share in a rateable distribution of assets, or whose interest are affected by the sale, may apply to the Court to set-aside the sale on the ground of a material irregularity or fraud in publishing or conducting it:
Provided that the Court may after giving notice to the applicant, call upon him before admitting the application either to furnish security to the satisfaction of the Court for an amount equal to that mentioned in the sale warrant or that realized by the sale, whichever is less, or to deposit such amount in Court;
Provided also that the security furnished or the deposit made as aforesaid, shall be liable to be proceeded against only to the extent of the deficit on a re-sale of the property already brought to sale.
10. The amendment effected to Order 90 Rule 21 CPC, as it applicable to the State of Andhra Pradesh, is only for the purpose to safeguard the interests of the decree holders or to sustain the sale effected in execution of the decree or whenever an objection is raised by the judgment-debtor or third party or any person claiming the property that was sold in public auction, the Court may call upon the said person either to furnish security for an amount equal to that mentioned in the sale warrant or that realized by sale or to deposit such amount in Court. The same is unnoticed – attention by the lower Court. Moreover, the appellant has not offered to deposit the sale amount to prove her bona fides to show that the property would fetch Rs. 12 lakhs to 14 lakhs if the proper publication is made by giving clear 15 days time and by giving proper publicity.
11. The Supreme Court in Motors and Investments Limited v. New Bank of India , held that it is a well settled legal position that when the Court was inclined to bring the property to sale, the endeavour of the Court should be to sustain the Court sale. Equally, though Court sale is compulsive sale, equal endeavour should be made to fetch adequate price for the property sold so that the decree would get satisfied and surplus, if any, could be paid over to the judgment-debtor.
12. After taking note of the principles laid down in the above judgment, a Division Bench of the Kerala High Court in Regi George v. K.K. Bhaskaran Nair (supra), held that throughout the entire process of sale in execution of decree, it shall be the endeavour of the Court to obtain adequate price for the property put in for sale and the obtaining of adequate price in auction sale, no doubt amounts to ‘substantial injury’, contemplated under Sub-rule (2) of Rule 90 CPC. The onus of proving substantial injury is on the applicant who seeks to set-aside the sale.
13. Order 21 Rule 90(1) authorizes the Court to set-aside sale of any immovable property sold in execution of the decree on the ground of material irregularity or fraud in publishing or conducting it on an application made to it by the decree-holder or the purchaser or any person including judgment-debtor or whose interests are affected by sale. Once the terms are settled fixing the date for sale, the same has to be conducted by an officer of the Court or by such other officer as the Court may appoint in this behalf and shall be made by public auction in the manner prescribed under Rule 65 who will follow the procedure as contemplated under Rules 66 and 67. Warrant of attachment issued to the Bailiff of the Court under Order 21 Rule 66 authorizing him to give 15 days previous notice, affix the same in the Court house and to make due proclamation of the schedule property attached under warrant made earlier in suit, returnable on or before 17-11-1999, was issued on 4-11-1999 as per the certified copy of the warrant of sale produced by the appellant. On verification of the original record reveals that warrant itself was signed and issued on 4-11-1999. On issuance of such warrant authorizing Bailiff for making due proclamation, no proclamation as such was made by the Bailiff/Process Server. Even before such warrant is given to the Bailiff, it is not known under what authority he got affixed the proclamation of sale and made beat of torn torn on 2-11-1999. On issuance of warrant only beat of torn torn and affixture of notice shall be made by the Bailiff/Process Server but not earlier. There is no evidence to show that such proclamation of sale has been issued on issuing warrant and has been affixed in the office of the Gram Panchayat.
14. The sale notice which was got published in the newspaper by the advocate for the decree-holder dated 3-11-1999 does not indicate any authorization under which it was published, that too even before issuance of warrant of sale to the Bailiff as referred to above. The Bailiff/Process Server as well as the advocate appeared for the decree-holder in the executing Court are over enthusiastic in publishing proclamation of sale even before necessary authorization. Moreover, there is no evidence to show that the proclamation of sale has been affixed in the office of the Gram Panchayat, where the property is ordered to be sold is situate, as mandated by Sub-rule (2) of Rule 54 of Order 21. In view of the same, the proclamation of sale, if any, made is non-est in the eye of law and, subsequent proceedings, viz., conducting sale, issuance of sale certificate and delivery of possession, are deemed to be null and void, and the sale is accordingly set-aside.
15. Learned Counsel for the second respondent-auction purchaser has brought to the notice of the Court that on dismissal of EA, sale certificate was issued in his favour and accordingly property was also delivered during the pendency of the appeal before this Court.
16. The record also indicates that on deposit of the amount by the auction-purchaser, decree-holder has been paid the decretal amount and the balance is lying in the Court.
17. Once the sale itself is illegal and made without following the procedure, which cannot be upheld, the lower Court ought to have sustained the objection made by the petitioner/6th judgment-debtor.
18. For the aforementioned reasons, the impugned order and decree of the executing Court in EA No. 1020/99 in EP No. 46/98 in OS No. 192/87 is hereby set-aside subject to the condition that appellant deposits a sum of Rs. 7,15,000/- (Rs. Seven lakhs and fifteen thousand only) being the price fetched at the public auction, within a period of three weeks from the date of receipt of a copy of the judgment. In the event, the executing Court feels that the amount deposited by the appellant is sufficient to discharge the decretal amount, it is needless to say that it is not necessary for the executing Court to put the property in auction, and the amount so deposited earlier by the auction-purchaser shall be refunded to him. If the amount, ordered to be deposited by the appellant, is more than the amount due to the decree-holder, excess amount, after adjusting the amount due to the decree-holder/auction purchaser, shall be refunded to the appellant. In default of payment of Rs. 7,15,000/- within the stipulated period as stated above, the civil miscellaneous appeal shall stand dismissed.
19. The civil miscellaneous appeal is accordingly allowed to the extent indicated above.