Bandu Hari Kamble (O... v. Bhagya Laxman Mahar ..., Bombay High Court, Judgment, Law, casemine.com

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Case Number

Second Appeal No. 449 of 1953

Advocates

K.R Bengeri, for the appellant.
S.G Karnik, for respondents Nos. 1 and 2.
Mrs. C.K Bengeri, for respondent No. 3.

Judges

Mr. Bavdekar
Mr. Chainani, JJ.

Acts

Order XXI, rule 22, Civil Procedure Code
Bombay Small Holders Relief Act,
Order 21, rule 22
Relief Act, 1874,

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Smart Summary

Factual and Procedural Background

In 1939 respondent No. 3 filed a suit against respondents Nos. 1 and 2 for possession of land he had purchased. A consent decree was entered on 24 January 1941 by which respondent No. 3 abandoned his claim to the land and respondent No. 1 (the contesting defendant) agreed to pay Rs. 125 plus interest in four equal instalments, the first being due in December 1941. The decree created a charge on the suit property and provided that in case of default the decree-holder could recover the amount by sale of the property.

The first two instalments (due December 1941 and December 1942) were not paid. Respondent No. 3 filed a darkhast on 12 April 1943 to recover these instalments by sale. Order XXI, rule 22, Civil Procedure Code requires, where execution is sought more than two years after the decree, that the Court issue a notice to the person against whom execution is applied to show cause why execution should not proceed. No such notice was issued by the Court to the judgment-debtors.

The Court ordered sale of part of the property and transferred papers to the Collector. The Collector issued notices; the judgment-debtor (respondent No. 1) appeared before the Collector, claimed the benefit of the Bombay Small Holders Relief Act and was granted time to pay, but failed to deposit the sums. The Collector proceeded to put the property up for sale; on 12 January 1944 the property was sold to the present appellant for Rs. 170 after due notice to the judgment-debtor. The judgment-debtor later filed a suit declaring the sale illegal; that suit was dismissed for default on 24 July 1945 and his application to set aside the dismissal was rejected on 3 December 1945. The Collector confirmed the sale on 29 October 1945 and sent papers back to the Court.

Meanwhile the remaining two instalments under the decree became due. The decree-holder sought an amendment to the darkhast to execute for those instalments. At that stage the executing Court issued a notice under Order XXI, rule 22 to the judgment-debtor. The judgment-debtor then appeared and contended that because no r.22 notice had been issued before the Collector's sale the Court had no jurisdiction and the sale was null and void. The executing Court accepted that contention and declared the sale in favour of the appellant void. The appellant and the decree-holder appealed to the District Court and their appeal was dismissed. The appellant then filed this second appeal.

Legal Issues Presented

Whether the absence of a formal notice under Order XXI, rule 22, Civil Procedure Code, before the sale (including where the sale was conducted by the Collector) deprives the executing Court of jurisdiction and renders the execution sale void.
Whether a judgment-debtor's actual appearance and participation in execution proceedings (for example before the Collector), including raising objections or claiming statutory reliefs, can constitute a waiver of the notice required by Order XXI, rule 22, thereby validating the sale despite absence of a formal r.22 notice issued by the Court.
Whether the fact that the proceedings and notice were conducted by the Collector (and not the Court) affects the question of jurisdiction or the applicability of the rule in issue.

Arguments of the Parties

Judgment-debtor's Arguments

The judgment-debtor argued that because no notice under Order XXI, rule 22 had been issued prior to the Collector's sale, the executing Court lacked jurisdiction to sell the property and that the sale was therefore null and void.
The judgment-debtor also claimed the benefit of the Bombay Small Holders Relief Act and relied on that claim when appearing before the Collector, seeking time to pay amounts due under the decree.

Appellant and Decree-holder's Arguments

The appellant and the decree-holder appealed against the executing Court's declaration that the sale was void; their position, as reflected by the appeals, was that the sale should be sustained.
Counsel for the appellant (Mr. Karnik) sought to distinguish the authority Chandra Nath v. Nabadwip Chandra on the ground that in the present case the sale was conducted by the Collector and notices which induced the judgment-debtor to appear were issued by the Collector rather than the Court.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Raghunath Das v. Sundar Das Khetri (Privy Council)	Held that a sale held without issuance of a notice corresponding to Order XXI, r. 22 (s. 248 of old Code) was void; view that such a notice is necessary for the Court to obtain jurisdiction to sell the property.	Cited as authority for the proposition that lack of a formal r.22 notice can render an execution sale void; the present Court discusses this view and distinguishes it where the judgment-debtor has in fact been given an opportunity to show cause.
Rajagopal Ayyar v. Ramanujachariar (Full Bench, Madras High Court)	Followed the view in Raghunath Das that absence of the statutory notice vitiates the sale.	Noted as a supporting authority for the strict view that notice under r.22 is necessary to confer jurisdiction.
Chandra Nath v. Nabadwip Chandra (Calcutta High Court)	Considered Raghunath Das and held that where judgment-debtors had appeared (on another notice) and actively disputed matters, it was unnecessary to enforce a strict requirement of a formal r.22 notice; execution could proceed.	Cited as authority for the proposition that actual participation by the judgment-debtor in execution proceedings can dispense with the formal r.22 notice; relied upon by this Court as persuasive authority supporting waiver by conduct.
Fakhrul Islam v. Rani Bhubanshwar Kuer (Patna High Court)	Held that r.22 requires that the judgment-debtor be given an opportunity to show cause, and where that opportunity was effectively given (even if formal service failed), Court had jurisdiction to hold the sale.	Relied on in Chandra Nath and in this opinion to support the view that the substantive objective of r.22 (opportunity to show cause) is satisfied by actual opportunity and appearance, producing jurisdiction despite formal defects.
Shiyali Chetti v. Valjee Kanjee & Co. (Madras High Court)	Followed the line of authorities that an appearance and contest by the judgment-debtor can negate the necessity for strict enforcement of the formal r.22 notice requirement.	Noted as a follow-up authority consistent with the principle that the object of r.22 is to afford opportunity and can be satisfied by conduct.
Ladli Parshad v. Chaman Lal (Lahore High Court)	Adopted the same approach as Chandra Nath and Fakhrul Islam regarding waiver by participation in proceedings.	Referenced as part of the line of authorities supporting the present Court's reasoning that actual participation achieves the r.22 objective.
Bimalanandhan v. United Refineries (Rangoon High Court)	Held that where the judgment-debtor was fully aware of the steps taken in connection with sale, he could not later challenge the sale on ground that no r.22 notice had been issued; observed that r.22 was enacted for the judgment-debtor's protection and can be waived by conduct.	Cited and relied upon (including Page, C.J.'s observations) to support the proposition that r.22 may be waived by the judgment-debtor's conduct and awareness of proceedings.
Anil Kumar Roy Chowdhary v. Ahmed Ali	Held that where the judgment-debtor appeared and repeatedly sought adjournments with knowledge of the sale, he cannot subsequently rely on want of notice under r.22 to set aside the sale.	Used as an example of the principle that active participation and procedural conduct by a judgment-debtor amounts to waiver of the formal notice requirement.

Court's Reasoning and Analysis

The Court first identified the competing lines of authority. One line (exemplified by Raghunath Das and the Full Bench of the Madras High Court in Rajagopal Ayyar) takes a strict view that absence of the formal r.22 notice deprives the executing Court of jurisdiction to sell the property. The other line (exemplified by Chandra Nath, which relied on Fakhrul Islam, and followed by several High Courts and the Rangoon High Court) reasons that the substantive object of Order XXI, rule 22 is to give the judgment-debtor an opportunity to show cause against execution and to satisfy the decree; if that object has been achieved by the judgment-debtor's appearance and active contest of the execution proceedings, the formal rigid requirement of a court-issued r.22 notice should not be allowed to defeat the execution.

The Court embraced the latter line of authority. It explained the underlying principle: r.22 is enacted for the benefit and protection of judgment-debtors so as to prevent a "snap" order, but where a judgment-debtor has actually been given the opportunity to be heard (even if that opportunity arose through notices and proceedings before the Collector rather than a formal court-issued r.22 notice), the purpose of the rule has been satisfied. In that situation the judgment-debtor is deemed to have waived the formal notice requirement and cannot thereafter challenge the sale on the ground that a formal r.22 notice was not issued.

Applied to the facts, the Court observed that the judgment-debtor had been given notices by the Collector, had appeared before the Collector on more than one occasion, had claimed relief under the Bombay Small Holders Relief Act and had been given time to pay but had failed to do so. These events meant that the judgment-debtor was fully aware of, and had actively participated in, the execution process and had the opportunity to satisfy the decree or to raise any objections. Although he did not appear before the Court itself prior to the sale, the Court held that this did not alter the outcome because the substantive opportunity to show cause had been provided. Consequently, the Court concluded that the object of r.22 had been achieved and the judgment-debtor must be held to have waived the formal notice requirement.

The Court also addressed and rejected the attempt to distinguish Chandra Nath on the basis that the sale in the present case was conducted by the Collector and not the Court: the Court found no material difference for the principle it applied. A concurring view by Bavdekar J. was summarized: he explained the competing principles in the case law (strict jurisdictional approach in Raghunath Das versus the waiver/participation approach in Chandra Nath and others) and agreed that the judgment-debtor's conduct in this case amounted to waiver.

Holding and Implications

Core Ruling: The Court allowed the appeal: the sale of the suit property held by the Collector in January 1944 was not illegal. The Court set aside the executing Court's order of 7 January 1948 (which had held the sale void), the confirming order of the Assistant Judge, and dismissed the judgment-debtor's application to set aside the sale with costs throughout. The Court directed that the executing Court should proceed further with the darkhast in accordance with law.

Implications:

The decision applies the principle that the substantive object of Order XXI, rule 22 is to afford the judgment-debtor an opportunity to show cause; where that opportunity has in fact been afforded through the judgment-debtor's actual participation or appearance (including before the Collector), the formal issuance of a court notice under r.22 is not an indispensable jurisdictional precondition and the requirement may be deemed waived.
As applied, the ruling leaves the sale in favour of the appellant intact and requires the executing Court to continue execution steps; costs were awarded against the judgment-debtor.
The Court did not state that a new general rule was being laid down; rather it applied and followed the existing line of authorities that treat actual participation or awareness by the judgment-debtor as achieving the object of r.22 and constituting waiver of a formal notice.

Appeal allowed.

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Bandu Hari Kamble (Original Auction Purchaser), v. Bhagya Laxman Mahar And Others (Original Judgment Debtors And Decree-Holders),

Chainani, J.:—

The material facts, so far as this appeal is concerned are these. In 1939 respondent No. 3 filed a suit against respondents Nos. 1 and 2 for possession of the suit property which he had previously purchased. A consent decree was passed in that suit on January 24, 1941. By the compromise, respondent No. 3 gave up his claim to the suit land, while, respondent No. 1, who it appears was the contesting defendant agreed to pay him a sum of Rs. 125 and interest thereon in four equal instalments, the first instalment being payable in December 1941. The decree placed a charge on the suit property and provided that in case of default in the payment of any instalment, respondent No. 3 could recover the amount by sale of the suit property. As the first two instalments, which fell due in December 1941 and December 1942, were not paid, respondent No. 3 filed a darkhast for recovering the amount of these instalments by sale of the suit property. This darkhast was filed on April 12, 1943, that is, more than two years after the date of the decree. Order XXI, rule 22, Civil Procedure Code provides:

“Where an application for execution is made more than two years after the date of the decree, the Court executing the decree shall issue a notice to the person against whom execution is applied for requiring him to show cause why the decree should not be executed against him.”

No such notice was issued to the judgment debtors, respondents Nos. 1 and 2. The Court passed an order that a sufficient part of the suit property should be sold, and transferred the papers to the Collector for carrying out the sale. The Collector issued notices to the judgment-debtors. The respondent No. 1, judgment-debtor No. 1, referred to hereafter as the judgment-debtor, appeared and claimed the benefit of the Bombay Small Holders Relief Act, which was then in force. He was given time to pay the amount due from him, but as he did not do so, the property was put up for sale and sold on January 12, 1944, after due notice to him. It was purchased by the present appellant for Rs. 170. Thereafter the judgment-debtor again applied to the Collector to give him the benefit of the Small Holders Relief Act. The Collector gave him further time to deposit the amount due, but he failed to do so. The judgment-debtor then filed a suit for a declaration that the sale in favour of the appellant was illegal and not binding upon him. This suit was dismissed for default on July 24, 1945. The judgment-debtor made an application for setting aside the order of dismissal and restoring the suit to file, but that application was rejected on December 3, 1945. The sale was confirmed by the Collector on October 29, 1945, who then sent the papers to the Court for further action. In the meantime, the remaining two instalments due under the decree had become due. The decree-holder, respondent No. 3, applied for an amendment of the darkhast, by which he sought to execute the decree for recovery of the amount of these instalments also. The executing Court then issued a notice under O. XXI, r. 22 to the judgment-debtor. He appeared and contended that as notice under O. XXI, r. 22 had not been issued before the Collector was asked to sell the property, the Court had no jurisdiction to execute the decree and that consequently the sale of the suit property was null and void. This contention was accepted by the Court, which accordingly declared the sale held in favour of the appellant to be void. The appellant and the decree-holder, respondent No. 3 appealed to the District Court, but their appeal was dismissed. The appellant has now filed a second appeal.

In Raghunath Das v. Sundar Das Khetri,(9) the Privy Council held that where a sale was held without the issue of a notice under s. 248 of the old Code which corresponded to O. XXI, r. 22 of the present Civil Procedure Code, the sale was void; see also the Full Bench decision of the Madras High Court in Rajagopal Ayyar v. Ramanujachariar(10). The view taken in these cases was that a notice under this rule is necessary in order that the Court should obtain jurisdiction to sell the property in execution. Raghunath Das v. Sundar Das Khetri, was considered by the Calcutta High Court in Chandra Nath v. Nabadwip Chandra(11). In that case no notice under O. XXI, r. 22 was issued to the judgment-debtors, but a notice under O. XXI, r. 66 was issued to them. The judgment-debtors appeared and raised objections to the valuation of the property, which was to be mentioned in the proclamation of sale. After these objections had been disposed of, the judgment-debtors contended that the sale could not proceed, because no notice under O. XXI, r. 22 had been given to them. This objection was overruled and the execution was allowed to proceed. In his judgment Rankin, C.J stated that it was “quite unnecessary to push the abstract logic of the case of Raghunath Das v. Sundar Das Khetri to this rediculous extreme.” He relied on the decision of the Patna High Court in Fakhrul Islam v. Rani Bhubanshwar Kuer(12) and went on to observe:

“It appears to me to be merely piling unreason upon technicality to hold upon the circumstances of this case that it is open to the judgment-debtors on these grounds to object to the jurisdiction of the Court because they have not got a formal notice to do something, namely to dispute the execution of the decree when in point of fact they were busy disputing about it in all the Courts for the best part of the last two years. I decline to push the doctrine so far as that and it seems to me that the execution should proceed.”

In Fakhrul Islam's case a notice under O. XXI, r. 22 had been issued, but not served upon the judgment-debtor. The judgment-debtor appeared and contested the execution. It was held that all that r. 22 requires is that an opportunity should be given to the judgment-debtor to show cause why execution should not proceed and as this object had been achieved, the Court had jurisdiction to hold the sale. These cases were followed by the Madras High Court in Shiyali Chetti v. Valjee Kanjee & Co.(13) and the Lahore High Court in Ladli Parshad v. Chaman Lal(14) The Rangoon High Court has taken the same view in Bimalanandhan v. United Refineries(15). In that case the judgment-debtor was fully aware of the steps that had been taken in connection with the sale. It was held that he could not subsequently challenge the sale, on the ground that no notice under O. XXI, r. 22 had been issued. In his judgment, Page, C.J observed:

“It is to be borne in mind that Order 21, rule 22 was enacted solely in aid of judgment-debtors and their legal representatives, and to prevent a “snap” order being obtained for execution against a judgment-debtor or his estate. Now, when a statute or a statutory rule is enacted granting a privilege to a particular person or class of persons, it may be, as in the case of the contractual incapacity of infants under the Infants Relief Act, 1874, that the statute or rule was enacted not merely for the benefit of the person or the class of persons to which it applied but upon grounds of public interest, and in such cases, no doubt, the persons in whose favour the enactment works cannot be barred by their own conduct from invoking the aid of the statute or rule that has been passed in the interest of the public generally……

“In each case, however, regard must be had to the intention of the legislature in enacting the rule and in cases such as the present case, in which a rule has been enacted solely for the protection of judgment-debtors and their estates, and not upon grounds of public policy or in the interest of the public generally, in my opinion it is clear both upon principle and authority that a person in whose favour the rule operates may by his conduct debar himself from the right of insisting upon its enforcement.”

In Anil Kumar Roy Chowdhary v. Ahmed Ali(16) it was held that where the judgment-debtor has put in appearance and repeatedly asked for adjournment of the sale, obviously with the knowledge of the sale, he cannot plead want of notice under O. XXI, r. 22 for setting aside the sale.

The principle underlying these cases, with which we agree, is that even though a notice under O. XXI, r. 22, Civil Procedure Code, which has been enacted for the benefit and protection of judgment-debtors, has not been issued to a judgment-debtor, if he actually appears in execution proceedings and raises various objections, the object of giving him a notice under r. 22, which is to afford him an opportunity to show cause against execution and to satisfy the decree before execution issues, has been achieved, that if he does not then object to the execution on account of the failure to issue such a notice, he must be deemed to have waived the notice and that he cannot subsequently be allowed to challenge the sale on the ground that such notice had not been issued. In this case, the judgment-debtor was given notices by the Collector. He was, therefore, fully aware of the execution proceedings and had an opportunity to appear in these proceedings and object to the execution or to satisfy the decree. He actually appeared before the Collector more than once, claimed the benefit of the Bombay Small Holders Relief Act and also asked for and was given time to pay the amount due from him. The object of giving him a notice under O. XXI, r. 22 was, therefore, in fact achieved. It is true that he did not appear before the Court but only before the Collector, but we do not think that makes any difference. He raised certain objections, e.g that he was entitled to the benefits of the Bombay Small Holders Relief Act. He could also have objected, if necessary, by an application to the Court, to the sale being held without the issue of a notice to him under O. XXI, r. 22. But he did not do so. It may, therefore, reasonably be presumed that he had no other contentions to raise. He must consequently be held to have waived the notice under the above rule and cannot be heard to say that the sale is invalid for want of this notice.

We are, therefore, of the opinion that the sale of the suit property held by the Collector in January 1944 was not illegal. Accordingly, we set aside the order passed by the executing Court on January 7, 1948, holding the sale to be void, which was confirmed in appeal by the Assistant Judge, and dismiss the application made by the judgment-debtor, respondent No. 1 for setting aside the sale with costs throughout, and direct that the executing Court should proceed further with the darkhast in accordance with law.

Bavdekar J.— In my view, the case of Raghunath Das v. Sundar Das Khetri,(17) proceeds upon the principle that where notice under O. XXI, r. 22 is not served, jurisdiction is not conferred upon the executing Court merely by his being made aware of the proceedings, for example, in that case, by a notice issued to the Official Assignee to show cause why his name should not be substituted for the insolvent judgment-debtor in that case. Where, therefore, he took no notice of the proceedings and subsequently the property was sold, it is open to the transferee from the vendee to maintain a suit upon the footing that the execution sale was without jurisdiction.

On the other hand, the case of the Calcutta High Court reported in Chandra Nath v. Nabadwip Chandra(18) proceeds upon the principle that the object of giving a notice under O. XXI, r. 22 is to give an opportunity of putting forward any objections which he may have to the execution proceedings. Where, therefore, even though no notice under O. XXI, r. 22 is issued or served, the judgment-debtor appears and takes part in the proceedings and raises objections or claims certain reliefs to which he is entitled, for example, in this case, under the Bombay Small Holders Act, it must be taken that he has waived the notice and that if he raised no objections such as could be raised when a notice under O. XXI, r. 22 is served upon him, he had no such objections to urge. He cannot subsequently, when his other objections are disallowed and the sale is confirmed, turn round and say that the Court had no jurisdiction.

Mr. Karnik has sought to distinguish the present case from that of Chandra Nath v. Nabadwip Chandra on the ground that in this case the sale was held not by the Court but by the Collector, and the notice in answer to which the judgment-debtor appeared before the Collector was also given by the Collector. But I fail to understand what difference that makes to the principle enunciated above.