1. This is a Civil Revision Petition under Section 25 of the Provincial Small Cause Courts Act against the decision of the learned District Munsif of Repalle in S.C.S No. 253 of 1954. The suit was instituted by the first respondent for the recovery of a sum of Rs. 356-3-6 being the amount deposited in S.C No. 273 of 1949 by the plaintiff under the following circumstances:
2. The plaintiff, 1st respondent in the revision petition, instituted a suit against the 2nd respondent S.C 273 of 1949, on the file of the District Munsif Court Repalle, and obtained a decree on 25-11-1949. He brought the properties to sale in E.P No. 74 of 1950. One Paleti Raghaviah and Koteswara Rao filed claim petitions under Order 21 Rule 58 of the CPC. Those claim petitions were dismissed on 2-9-1950. The property brought to sale in E.P No. 74 of 1950 was subsequently sold in court auction for Rs. 715/-. The plaintiff who is the decree holder pruchased the properties in auction. The decree holder retained Rs. 380-11-0 in his hands towards the satisfaction of the decree obtained by him in S.C 273 of 1949 and paid in court the balance of Rs. 334/-. The defeated claimants' Paleti Raghaviah and Koteswara Rao, filed original suits, 255 of 1950 and 256 of 1950. Those suits ended in favour of the claimants. The judgments in the claim suits were pronounced on 8-11-1951. The effect of those decisions was that the second respondent, who was the sole defendant in S.C 273 of 1949, was declared to have no saleable interest in the property brought to sale and purchased by the first respondent-decree-holder in court auction, on 2-9-1950.
3. Meanwhile, the 1st defendant to the action in S.C 253 of 1954, and the revision petitioner herein, brought a suit against the second respondent, O.S 272 of 1950 & got a sum of Rs. 334/- attached out of the sum deposited by the first respondent auction purchaser and withdrew the same on 19-3-1951. After the claim suits were decreed in favour of the claimants on 8-11-1951, the first respondent instituted the present suit, S.C 253 of 1954 for the recovery of the sum of Rs. 301/- withdrawn by the present revision petitioner. The suit was filed on 24-8-1954.
4. The first defendant to the suit and the petitioner herein, contended that he was not a party to the claim suits, that decrees therein were collusively obtained, that the court sale held on 2-9-1950 was valid and that it had not been set aside, and that, therefore, the present suit would not lie. Before the learned District Munsif, two points appear to have been raised: (i) that the suit was not maintainable; and (ii) that it was barred by limitation. On both these points, the learned District Munsif found against the defendants and in favour of the plaintiff, and decreed the suit in terms prayed for. Hence this Civil Revision Petition.
5. Mr. Venkafarama Sastri, the learned counsel for the petitioner has contended before me that where, a court auction purchaser finds that the judgment-debtor has no saleable interest in the property which he purchased in the court auction, the only course open. So him is to have the sale set aside under Order, 21, Rule 91 of the CPC. Since that has not been done within the period of limitation prescribed under Article 166 of the 1st Schedule to the Indian Limitation Act, the Court auction purchaser cannot now seek to recover the money paid by him on the footing of the failure of consideration.
6. According to the learned counsel, a suit for the recovery of such an amount is not maintainable. In support of his contention that the only course open to the court auction-purchaser who discovers that the judgment-debtor has no saleable interest in the property purchased, is an application under Order 21 Rule 91 of the CPC, Mr. Vankatarama Sastri has relied upon several decisions of the Madras High Court, such as Muthukumarasamia Pillai v. Muthusami Thevan AIR 1927 Mad 394; M. Jagannadha Rao v. R. Basawayya AIR 1927 Mad 835; and the Full Bench decision in Veeraraghavayya v. Venkataraghava Reddi 1947-2 Mad LJ 468 at p. 472 : (AIR 1948 Mad 226 (FB) at p. 229). With respect to the first of the two bench decisions of the Madras High Court, I may observe that the point that arose in those cases is entirely different from the one that falls for decision in the present case.
7. In those two bench decisions, the question that arose for determination was whether when an auction purchaser enters full satisfaction of the decree and later finds that the judgment-debtor had no saleable interest in the property, a fresh execution petition could be filed. The learned Judge took the view that the decree having been satisfied and no application under Order 21 Rule 91 of the CPC having been made within the period of limitation prescribed therefor, a fresh application for execution could not be made.
8. In the Full Bench case referred to supra, the question was whether in respect to a court sale of property, which is admittedly not liable to attachment and sale, the judgment-debtor could ignore the court sale as a nullity. The learned Judges held that it will have to be avoided in accordance with law and so long as the sale stands, it could not be ignored. I do not think that case has any direct bearing upon the present question. It is true that in all those cases there are observations to the effect that the court sale is voidable as the court sales do not carry with them any warranty of title and that when it is discovered that the judgment-debtor had no saleable interest in the property sold, the only course is an application under Order 21 Rule 91 of the CPC.
9. But I am, however, relieved of the obligation he consider the above cases and a large number of other citations by Mr. Venkatarama Sastri, because in my view the decision of the Full Bench of the Madras High Court in Macha Koundan v. Kottora Koundan AIR 1936 Mad 50 is a direct authority on the question I have to consider. It was held that where the Court sale turns out to be futile by a finding in another suit, the only remedy that the party has, is a regular suit and not an application under O. 21 R. 93 of the CPC. In the said decision a large number of authorities were considered including the two cases cited by Mr. Venkatarama Sastri, that is, AIR 1927 Mad 394 and AIR 1927 Mad 835. It is not necessary for me it refer in greater detail to that decision except to say that it has a direct application to the facts of this case.
10. Mr. Venkatarama Sastri, however, contends that the correctness of the Full Bench decision has been doubted in certain cases. Reference has been made to a decision of Sommaya J., in Butchi Reddi v. V. Suryaprakasarao, AIR 1945 Mad 40, where the learned judge has observed that there are weighty considerations for reconsidering the Full Bench decision in AIR 1936 Mad 50 and that those reasons were discussed in detail in a decision of a bench of the Madras High Court in an unreported Appeal No. 90 of 1942. Reference also has been made to a decision of Leach, C.J and Laxmana Rao J., in Finn Narasingi Vannechand v. Suryadevara Narasayya AIR 1945 Mad 363 where the learned Judges have made an observation that the principle of the Full Bench case in AIR 1936 Mad 50 should not be extended beyond what was decided actually in that case. Reference has been made to a decision of Raghava Raoi, J., in Venkataramiah Chetty v. Chinna Pulliah 1949-2 Mad LJ 466 : (AIR 1950 Mad 41).
11. But I cannot read that judgment as in any manner doubting the correctness of the Full Bench decision and the learned Judge observed on the contrary that it embodies undoubtedly a more equitable view than that of the Allahabad Full Bench in Amarnath v. Firm Chwtelal Durgaprasad ILR 1938 All 1938 : (AIR 1938 All 593). Whatever might be the case for a reconsideration of the Full Bench decision in AIR 1936 Mad 50 it has not so far been overruled by a fuller bench, and as long as it stands it is a binding authority for the position that it is open to a court auction purchaser ion finding that the judgment-debtor has no saleable interest in the property sold to sue for the refund of the money on the foot of failure of consideration.
12. It is contended by Mr. Venkatarama Sastri that even if the Full Bench decision is correct, it cannot apply to a case where the auction-purchaser is the decree-holder. In support of that contention strong reliance has been placed on the decision of Pandranga Rao J., in T. Keshavan v. Bipathumma AIR 1935 Mad 340. It is true that the learned Judge therein had observed that the decision of the Full Bench cannot be applied to a case where, as in the case before him, the auction purchaser is the decree holder. With due deference to the learned Judge, I do not think the view expressed by him is correct.
13. In the first place, there is nothing in the language of the Full Bench decision to confine the principle of the ruling only to the case of a stranger auction-purchaser. In the second place, it had been held in AIR 1927 Mad 394 and AIR 1927 Mad 835 that there is no distinction in principle or on the language of the Code of Civil Procedure between a decree-holder auction purchaser and a stranger auction-purchaser as to their rights in respect of court sales where it is established later that the judgment-debtor had no saleable interest in the property sold. I do not think, therefore, that the decision of Pandrang Row J., can help the petitioner.
14. In view of the foregoing discussion and the decision of the Full Bench, I hold that the suit in the present form was maintainable and the decision of the learned District Munsiff as to the maintainability is correct.
15. The next point argued by Mr. Sastri is as to limitation. His contention is that the learned District Munsif erred in applying Article 97 of the first schedule to the Limitation Act to the facts of the present case. According to the learned counsel, the article applicable is 62. Under that article, the period for limitation for suits for moneys had and received by the defendants for the use of the plaintiff is three years from the date when the money is received. It is contended that the respondent paid the money into court on 19-3-1951 and 21-3-1951. The suit was instituted on 24-8-1954. It is, therefore, argued that the suit is not within time. If Art. 62 should apply, it cannot be disputed that the suit is beyond time.
16. It, therefore, remains to be decided whether Art. 62 applies. In support of his contention, the learned counsel relies upon certain observations in the decision of the Full Bench case referred to supra jo the effect that a suit by an auction purchaser, who later finds that the judgment-debtor had no saleable interest in the property purchased by him, is in the nature of an action for money had and received. But it seems to me that no question as to the precise nature of such an action, much less the period of limitation, fell to be decided by the learned judges. The only point that was considered and determined therein was whether an auction purchaser could file a suit for the recovery of money paid by him in a court sale when it is later found that the judgment-debtor had no saleable interest in the property. That question was answered in affirmative. I am unable to read the Full Bench decision as a considered pronouncement that the basis of such an action is on the foot of moneys had and received. The learned counsel has also relied upon a decision of Cornish J., in D. Sivaramaraju v. Secretary of State AIR 1935 Mad. 354.
17. In that decision Cornish J., held that suits like the one under consideration, are for moneys had and received and that Article 62 was the relevant article of limitation. The correctness of that decision has been doubted by King J., in J. Rudrayya v. J. Subbarayappa AIR 1941 Mad 742 and by Satyanarayana Rao J., in Murugappa Chettiar v. Arunachala Goundan, AIR 1949 Mad 638.
18. It is a well recognised principle that Article 62 of the First Schedule of the Limitation Act applies only to transfers that are void ab initio, and it has been repeatedly held that court sales, where it is found later that the judgment-debtor had no saleable interest in the property sold are not void, but voidable. Further, the view that in such cases Article 62 would apply seems to be opposed to the decision of the Privy Council in Hanuman Kamat v. Hanuman Mandar, ILR 19 Cal 123 (PC) at p. 126, wherein it has been observed as follows:
“Tire 97th Article applies to a suit to recover money upon an existing consideration which afterwards fails, and it is said that the period of limitation is to date from the time when the consideration failed. Their Lordships are of opinion that the case must fall either within Article 62 or Article 97. If there never was any consideration, then the price paid by the appellant was money had and received to his account by Dowlut Mandur. But their Lordships are inclined to think that the sale was not necessarily void, but only voidable if objection were taken to it by the other members of the joint family. If so, the consideration did not fail at once, but only from the time when the appellant endeavoured to obtain possession of the property, and being opposed, found himself unable to obtain possession. There was then, at all events, a failure of consideration, and he would have had a right to sue at that time, to recover back his purchase money upon a failure of consideration; and, therefore, the case appears to be within the enactments of Article 97”.
19. Mr. Sastri contends that even if Article 97 should apply, admittedly in this case possession was not taken by the auction-purchaser, nor had he been prevented from taking possession or foiled in his attempt to take possession. That according to the learned counsel makes all the difference, and if the failure of consideration is the starting point, it can only obviously mean the time of dispossession. Therefore, it is argued that where possession has not been taken by the purchaser, there can be no question of failure of consideration.
20. Therefore, it is argued that where possession has not been taken by the purchaser, there can be no question of failure of consideration. It is also argued that the decision of Satyanarayana Rao J., in AIR 1949 Mad 638 and the decisions referred to therein by him proceed upon the footing that the period of limitation under Article 97 would commence only from the date of dispossession which alone would constitute the failure of consideration. There is indeed considerable force in this contention. But it seems to me that there are observations in decision of the Privy Council in Boid v. Pirthichand Lal, 46 Ind App 52 : (AIR 1918 PC 151), which may go counter to this view. In that case it was held that the starting point was the date of the decree reversing the sale. The decision of their Lordships in that case did not turn upon the possession or loss of possession.
21. There has been some difference of opinion as to the precise article that is applicable to cases of this kind. There are decisions which have applied Article 120. King J. in AIR 1941 Mad. 742 has considered that cases of this kind can more appropriately fall under Article 96, as being sales under a mistake. In 46 Ind App. 52 : (AIR 1918 PC 151) the real starting point of limitation is held to be the I date of the reversal of the sale by reason of the I decree obiatned by a third party. I am therefore inclined to think that Article 97 would apply and time would begin to run from the date of the decrees in the claim suits.
22. Even assuming that the learned District Munsif erred in applying Article 97, I do not think this is a case for interference. It had been repeatedly held that interference with the decisions of courts' under Section 25 of the Provincial Small Cause Courts Act is wholly discretionary, and should not be resorted to except in cases where justice has failed. I am fortified in this view by the decision of a very eminent Judge, B.K Kukherjea (as he then was). The learned Judge has held in Govinda Chandra v. Brojendra Mohan AIR 1946 Cal. 526 at p. 528 that where the trial court has misapplied the law of limitation, interference under Section 25 of the Provincial Small Cause Courts Act is not called for where justice has been done. The learned Judge observes as follows:
“I think, however, that although there has been a misapplication of the law of limitation by the Court below, no injustice has been done in these cases which calls for my interference under Section 25 of the Provincial Small Cause Courts Act. There is practically no answer to the claim of the plaintiff. The money was admittedly paid and the defendants have no justification for retaining the money. As the powers of revision under Section 25 of the Provincial Small Causes Courts Act are discretionary, and, in my opinion, apart from any injustice being done as a result of the decision of the Court below, injustice will certainly result if I interfere with and set aside the decision of the court below.”
23. These observations are applicable to the facts of this case. It is not in dispute that the respondent did pay the money. He did not get the property. In justice he is entitled to get the money back.
24. For the above reasons, I think the Civil Revision Petition should fail. It is, therefore, dismissed with costs.
LB/V.B.B
25. Petition dismissed.