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Narayana Pillai Krishna Pillai v. Damodaran Pillai Velayudhan Pillai .
Judgment Summary: Krishnamoorthy Iyer, J.
Factual and Procedural Background
This appeal was brought by the 8th defendant concerning the proper interpretation of the phrase "when the sale becomes absolute" in the third column of Article 180 of the Indian Limitation Act (IX of 1908).
In the execution of a decree, the decree-holder purchased decree schedule item 1 on 11-9-1953 and decree schedule items 4 and 5 on 26-9-1953. The court sale in respect of item 1 was confirmed on 11-10-1953. The 8th defendant filed a petition to set aside the court sale of items 1, 4 and 5 on 26-10-1953 under Order 21, Rule 90 of the CPC.
Procedural history thereafter (as recorded in the opinion): - The petition to set aside was dismissed for default on 19-1-1957 and the sale of items 4 and 5 was confirmed on the same date. - The 8th defendant filed an application on 11-2-1957 to restore the petition; the application was dismissed for default but later the petition was restored on 5-7-1957. - The petition to set aside the sale (restored petition) was dismissed on the merits on 19-10-1958.
The auction purchaser filed a petition for delivery of items 1, 4 and 5 on 17-10-1960. The execution court rejected that petition as barred by limitation under Article 180 of the Limitation Act. The appellate court reversed that view and held the petition was not barred because it was filed within three years of 19-10-1958 (the date of dismissal of the petition to set aside the sale). The question of the correctness of the appellate court's view was brought before the present court.
Legal Issues Presented
- What is the correct interpretation of the words "when the sale becomes absolute" in the third column of Article 180 of the Indian Limitation Act?
- Whether the petition for delivery of possession filed on 17-10-1960 was barred by limitation under Article 180, having regard to the dates of confirmation of court sale and the subsequent proceedings to set aside the sale (including restoration and final dismissal on 19-10-1958)?
- Whether a petition filed to set aside a confirmed sale (even if filed after confirmation) prevents the sale from becoming "absolute" for the purposes of Article 180 until the litigation is finally disposed of?
Arguments of the Parties
Appellant's Arguments (as recorded)
- The appellant submitted that in the present case the confirmations of the court sale occurred on dates (as stated in the opinion) of 11-10-1963 (for item 1) and 19-1-1967 (for items 4 and 5), and therefore the sales became absolute on those confirmation dates; consequently the petition for delivery filed beyond three years from those dates would be barred by limitation. (This submission is recorded in the opinion.)
- The appellant (8th defendant) also contended that the application to set aside the sale was beyond thirty days from the date of sale of item 1 and therefore, irrespective of the position of items 4 and 5, the prayer for delivery of item 1 should be held to be barred.
Other Parties / Court below (as recorded)
- The execution court held that the petition for delivery filed on 17-10-1960 was barred by limitation under Article 180 of the Limitation Act.
- The appellate court held that the petition for delivery was not barred because it had been filed within three years of 19-10-1958, the date on which the petition to set aside the court sale was dismissed on the merits; the appellate court viewed that the sale became absolute only on 19-10-1958.
- It was also alleged (as part of the factual account) that the judgment-debtor claimed lack of knowledge of the sale of item 1 until the date of filing the petition, on account of alleged fraud by the decree-holder. (This factual allegation appears in the judgment text.)
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Muthu Korakkai Chetty v. Madar Animal, ILR 43 Mad 185 : (AIR 1920 Mad 1) (FB) | Held that, where an application to set aside a sale is entertained after confirmation, time under Article 180 should be computed from the date of the order disposing of the petition to set aside the sale (not from the order of confirmation). | The court relied on this decision to support the proposition that a sale does not become absolute for Article 180 purposes until the application to set aside the sale under Order 21, Rules 89–91 has been disallowed and the sale upheld; this principle was applied to hold the sales became absolute only on 19-10-1958. |
| Chandra Mani Saha v. Anarjan Bibi, AIR 1934 PC 134 | Where an appeal lies from an order disallowing an application to set aside a sale, the sale will not become absolute under Article 180 until disposal of the appeal (i.e., finality requires disposal of the appeal). | The court cited this Privy Council decision to show that finality is not attached to an order confirming a sale until appellate disposal; it applied this to the present facts to treat 19-10-1958 (final disposal of proceedings to set aside) as the date when the sale became absolute. |
| Rama Krishna Rao v. Chellayamma, AIR 1953 SC 425 | Following the Privy Council, the Supreme Court held that where an appeal is filed against an order refusing to set aside an execution sale under O.21 R.90, no finality attaches to the confirming order until the appeal is decided. | The court relied on this Supreme Court authority to reinforce that, in cases of appeals against disallowance of setting-aside applications, the sale becomes absolute only after appellate determination; used to uphold the appellate court's approach in the case. |
| Krishnadatta v. Sindhuram, AIR 1950 Assam 89 | Where the formal order of confirmation is challenged within three years under provisions such as Sections 47 and 151 of the CPC, the order itself comes into question and the sale cannot be described as absolute until termination of the litigation. | The court cited this decision to reject the contention that the petition to set aside (filed after confirmation but within three years) left the sale absolute; applied to hold item 1's sale also became absolute only after dismissal on 19-10-1958. |
| Baiinath Sahai v. Ramgut Singh, (1896) ILR 23 Cal 775 (PC) | Interpreting Article 12 of the Limitation Act (1908), the Privy Council held there was no final confirmation of a sale while the question whether the sale should be confirmed was in litigation; final confirmation for limitation purposes occurred when the litigation produced a definitive operative order. | The court used this Privy Council principle to reinforce that a court sale does not become absolute on a mere order of confirmation required by O.21 R.92(1) but only upon termination of proceedings started to set aside the sale or the confirming order. |
| Bassu Kaur v. Dhum Singh, (1889) ILR 11 All 47 (PC) | Expresses the principle that it would be unjust to deprive a litigant of the right to institute litigation to challenge a sale and to permit limitation to defeat sensible litigation that seeks to assert rights. | The court quoted this to support the rule that litigation challenging a sale prevents the sale being treated as absolute until such litigation is finally disposed of; it reinforced the court's rejection of a rigid literalist timing rule in favour of a practical finality test. |
Court's Reasoning and Analysis
The court began by identifying Article 180 of the Limitation Act (an application for delivery of possession by a purchaser of immovable property sold in execution must be made within three years "when the sale becomes absolute") and Order 21, Rule 92(1) of the CPC (which provides that where no timely application is made under Rules 89–91, or where such application is made and disallowed, the court shall make an order confirming the sale and thereupon the sale shall become absolute).
The court considered the appellant's submission that the dates on which confirmations were passed operated as the dates when the sales became absolute and therefore the petition for delivery filed on 17-10-1960 was time-barred. In answering that submission the court undertook a close textual and precedential analysis.
Key strands of the court's analysis (as recorded in the opinion):
- The court relied on the Privy Council and High Court authorities (Muthu Korakkai Chetty; Chandra Mani Saha) and a Supreme Court decision (Rama Krishna Rao) to establish the principle that when proceedings are instituted to set aside a sale (or an order confirming a sale) after confirmation, time under Article 180 runs from the date when the proceedings to set aside have finally been disposed of — not from the earlier order of confirmation. This is because appellate or other proceedings prevent there being finality to the order of confirmation.
- The court applied Muthu Korakkai Chetty to hold that entertaining an application to set aside a sale after confirmation renders the earlier confirmation ineffective for the purpose of Article 180 until the application is disposed of.
- The court applied Chandra Mani Saha and Rama Krishna Rao to the effect that where an appeal lies, the sale does not become absolute until the appeal is disposed of; the appellate court's decision is the date of finality for limitation purposes.
- Addressing the appellant's additional contention concerning the thirty-day rule and the timing of the petition in respect of item 1, the court relied on Krishnadatta v. Sindhuram to conclude that a petition challenging confirmation (filed within three years) brings the confirmation into question and postpones the date on which the sale becomes absolute until termination of that litigation.
- The court reinforced these conclusions by reference to older Privy Council decisions (Baiinath Sahai and Bassu Kaur) which support the proposition that no definitive, final confirmation exists for limitation purposes while the matter of confirmation is in litigation.
Applying these principles to the facts before it, the court concluded that the court sales in respect of items 1, 4 and 5 became absolute only on 19-10-1958 (the date on which the petition to set aside the court sale was dismissed on the merits). Consequently, the petition for delivery filed on 17-10-1960 fell within the three-year period prescribed by Article 180.
The court also explicitly rejected the appellant's contention that because the application to set aside the sale of item 1 had been filed after the order of confirmation (and beyond thirty days from the date of sale) the prayer for delivery of item 1 should be barred. The court found no substance in that contention on the authority of Krishnadatta v. Sindhuram and the other authorities cited.
Holding and Implications
Appeal dismissed.
Direct effect on the parties:
- The court held that the sales of items 1, 4 and 5 became absolute only on 19-10-1958 (the date when the petition to set aside the court sale was finally dismissed on the merits).
- Because the petition for delivery was filed on 17-10-1960, it was within the three-year limitation period under Article 180 and therefore not barred by limitation.
- The second appeal brought by the appellant (8th defendant) was found to be without substance and was dismissed with costs.
Broader implications: The opinion applies and follows established authorities on when a sale becomes "absolute" for the purposes of Article 180 — namely, that finality for limitation purposes requires termination of proceedings challenging the sale or the confirming order. The judgment operates by applying existing precedent and practice to the facts; the opinion does not assert the setting of a novel legal precedent beyond applying those authorities to the case facts.
BK/AGJ/D.V.C
Krishnamoorthy Iyer, J.:— This appeal by the 8th defendant raises the question of interpretation of the words “when the sale becomes absolute” occurring in the third column of Article 180 of the Indian Limitation Act (IX of 1908).
2. In execution of file decree, the decree-holder purchased decree schedule item 1 on 11-9-1953 and decree schedule items 4 and 5 on 26-9-1953. The court sale in respect of item 1 was confirmed on 11-10-1953. The 8th defendant filed a petition of set aside the court sale of items 1, 4 and 5 on 26-10-1953 under Order 21, Rule 90 of the CPC, which was dismissed for default on 19-1-1957 and the sale of items 4 and 5 was confirmed on the same date. The 8th defendant filed an application on 11-2-1957 to restore the petition to set aside the court sale which was dismissed for default and it was restored on 5-7-1957. The said petition was dismissed on 19-10-1958 on the merits. The auction purchaser filed the petition for getting delivery of items 1, 4 and 5 on 17-10-1960. The execution court rejected the petition for delivery on the ground that it was barred by limitation under Article 180 of the Indian Limitation Act while the appellate court held that the petition for delivery was not barred since it was filed within three years of 19-10-1958, the date of the dismissal of the petition to set aside the court sale. The appellate court took the view that the sale of items 1, 4 and 5 became absolute only on 19-10-1958, though the orders confirming the court sales were passed earlier. The correctness of this view taken by the appellate Judge was canvassed before us. Article 180 of the Indian Limitation Act, 1908, provides that an application for delivery of possession by a purchaser of immovable property at a sale in execution of a decree should be made within three years when the sale becomes absolute. Time under Article 180 runs from the date when the sale becomes absolute. Order 21, Rule 92(1) of the CPC enacts:
“Where no application is made under rule 89, rule 90 or rule 91, or where such application is made and disallowed, the Court shall make an order confirming the sale, and thereupon the sale shall become absolute
Provided………
3. The submission on behalf of the appellant was that in the case before us the confirmation of the court sale of item 1 was on 11-10-1963 and of items 4 and 5 was on 19-1-1967 and therefore the sales became absolute on those dates and the petition for delivery filed beyond three years from those dates is barred by limitation.
4. In Muthu Korakkai Chetty v. Madar Animal, ILR 43 Mad 185 : (AIR 1920 Mad 1) (FB) after the confirmation of court sale on the 26th April, 1913, an application was made by the judgment-debtor on the 3rd January, 1914, to set aside the court sale on the ground of fraud and the court sale was set aside on the 25th June, 1916, in respect of part of the properties sold. The auction purchaser having made an application on the 17th February, 1917, for delivery of the remaining properties, the question arose whether the application for delivery was barred by limitation under Article 180 of the Limitation Act, having been filed beyond three years from the date of the order confirming the court sale. It was held that the application was not barred under Article 180 of the Limitation Act as the time should be computed from the date of the order disposing of the petition to set aside the court sale and not from the date of the order confirming the court sale. Abdur Rahim, Officiating, C.J observed at p. 198 (of ILR Mad): (at p. 6 of AIR):
“The effect of entertainment of the application to set aside the sale after the order of confirmation must, having regard to the intention of the legislature as disclosed in this rule and quite apart from any general theory in such connexions, be to render the order ineffecitive so as to make the sale absolute. If we were to proceed upon an absolutely literal interpretation of the language of rule 92 without paying due regard to the intention of the legislature, this case would have to be treated as lying outside that rule, for it requires that the order of confirmation should be made after the disposal of any application to set aside the sale. If so treated, there would be no difficulty in the application of article 180. Whether it is the practice to issue a second certificate on the disposal of such an application or not cannot, to my mind, affect the application of article 180; but I should suggest that a fresh certificate ought to be issued, if not in all cases, at least in those cases where the sale is only partly upheld as the result of an application made to set it aside after the passing of the order confirming the sale.
Upon a proper interpretation, therefore, of article 180 read with rule 92 of Order XXI of the CPC, I should hold that, where an application is made for delivery of possession of property sold in execution of a decree, the sale does not become absolute within the meaning of the third column of article 180 until the application made to set aside the sale under rule 89 or 90 or 91 has been disallowed and the sale upheld, although an order confirming the sale had been passed before the application to set aside the sale was made.”
5. In Chandra Mani Saha v. Anarjan Bibi, AIR 1934 PC 134 the application for delivery of possession was made beyond three years of the order dismissing the application to set aside the court sale and confirming the same but within three years of the order passed in appeal confirming the order refusing to set aside the court sale. In holding that the application for delivery though filed only within three years of the order passed by the appellate court was in time, their Lordships of the Judicial Committee observed:
“Upon consideration of the sections and orders of the Code, their Lordships are of opinion that in construing the meaning of the words ‘when the sale becomes absolute’ in Article 180 of the Lim. Act, regard must be had not only to the provisions of O. 21, R. 92(1) of the Schedule to the CPC but also to the other material sections and orders of the Code, including those which relate to appeals from orders made under O. 21, R. 92(1). The result is that where there is an appeal from an order of the Subordinate Judge, disallowing the application to set aside the sale, the sale will not become absolute within the meaning of Article 180 of the Lim. Act, until the disposal of the appeal, even though the Subordinate Judge may have confirmed the sale, as he was bound to do, when he decided to disallow the abovementioned application.”
6. The Supreme Court in Rama Krishna Rao v. Chellayamma, AIR 1953 SC 425, following the decision of the Privy Council cited above held that where an appeal is filed against an order refusing to set aside the execution sale under Order 21, Rule 90 of the CPC, no finality can be attached to the order confirming the sale, until the appeal is decided Fazl Ali, J. observed thus:
“In a simple case, the provisions cited above (Section 65 and O. 21, Rule 92 of the CPC) should settle the controversy, but, in the present case, the matter has been complicated on account of the appeal against the order refusing to set aside the sale under O. 21, R. 90. In such a case, generally speaking, the true position seems to be that there is no finality until the litigation is finally determined by the appellate court.
This principle has been recognised in a number of cases, but it will be enough to cite, AIR 1934 PC 134. The headnote of that case runs as follows:
‘Where a Subordinate Judge has disallowed an application under O. 21, R. 90, to set aside a sale in execution, and has made an order under rule 92(1) confirming the sale, and an appeal from disallowance has been dismissed by the High Court, the three years' period provided by the Indian Limitation Act, 1908, Schedule I, Article 180, for an application under O. 21, R. 95, by the purchaser for delivery of possession runs from the date of the order on appeal; the High Court having under the Code of Civil Procedure, 1908, the same powers as the Subordinate Judge, the time when the sale becomes ‘absolute’, for the purpose of Article 180 is when the High Court disposes of the appeal.’
Under Article 180, Limitation Act, the period of limitation runs ‘from the date when the sale becomes absolute’ If we give a narrow and literal meaning to these words, the period of limitation should be held to run from the date when the original court of execution confirms the sale. But, as was pointed out by the Privy Council, the High Court as an appellate court had the same powers as the trial court and it is only when the appeal was dismissed by the High Court that the order of the trial court confirming the sale became absolute. Till the decision of the appellate court, no finality attached to the order confirming the sale.”
7. In view of the above decisions, there should be no difficulty in holding that the court sales in respect of items 1, 4 and 5 in fee case before us became absolute only on 19-10-1958 and the petition for delivery filed on 17-10-1960 is therefore within time.
8. But it was contended on behalf of the 8th defendant, that the application to set aside the sale was beyond thirty days from the date of sale of item 1 and whatever may be the position regarding items 4 and 5 the prayer for delivery of item 1 should be held to be barred. There is no substance in this contention of the learned advocate. In Krishnadatta v. Sindhuram, AIR 1950 Assam 89 the confirmation of the court sale was on 27-3-1944 and the judgment-debtor filed the petition to set aside the court sale under Sections 47 and 151 of the CPC on 26-3-1945. The petition was dismissed on 4-10-1945. The order of dismissal was the subject-matter of appeal and revision in the High Court. The revision petition was dismissed by the High Court on 22-7-1947. The question arose whether the application for delivery on 3-5-1918 filed more than three years after the original order confirming the court sale on 27-3-1944 was in time. It was held that where the formal order of confirmation of an execution sale is challenged within three years by a petition under Sections 47 and 151 of the CPC the order itself conies into question and the sale becomes absolute not on the date when the formal order of confirmation was passed but on the termination of the litigation commenced by the judgment-debtor for having the sale set aside Their Lordships observed at p. 90:
“Where the formal order of confirmation is challenged by a petition under some provision of the Civil Procedure Code the order itself comes into question. If such a petition is made within three years, the period within which an auction-purchaser must apply for possession under R. 95 of the Cr PC, the ale cannot be described as absolute during the period that the petition for setting aside the sale remains pending. The reasoning is equally applicable to applications under R. 90 and application under S. 47 or 151. On principle, therefore, it is difficult to agree to a distinction between an application of the judgment-debtor for setting aside the sale under O. 21, R. 90 on the one hand, and an application under other provisions of the Code, e.g Sections 47 and 151, if they are made within three years from the date of the formal confirmation of the sale”.
9. In this connection it will be useful to refer to the decision of the Privy Council in Baiinath Sahai v. Ramgut Singh, (1896) ILR 23 Cal 775 (PC) construing the words “when the sale is confirmed, or would otherwise have become final and conclusive, had no such suit been brought” in Article 12 of the Limitation Act (1908). The facts in the case decided by the Privy Council were that a sale held by the Collector was confirmed by the Commissioner on 25-1-1884 and the suit to set aside the sale was filed only in July 1887. The period of limitation prescribed by Article 12 of the Limitation Act for such suit is one year. On 12-8-1884 the Board of Revenue had set aside the Commissioner's order but subsequently when they found that they had no jurisdiction to do so, restored the order of the Commissioner on 21-8-1886 The suit was filed within one year of the order dated 21-8-1886. It was held that there was no bar of limitation Lord Davey observed:
“Their Lordships are of opinion that there was no final conclusive and definitive order confirming the sale, while the question whether the sale should be confirmed was in litigation, or until the order of the Commissioner of the 25th January, 1884 became definitive and operative by the final judgment of the Board of Revenue on the 21st August, 1886, or (in other words) that for the purpose of the law of limitation there was no final or definitive confirmation of the sale until that date.”
10. The principle of the above decision also leads to the conclusion that a court sale does not become absolute on the passing of a mere order of confirmation enjoined by the provisions of Order 21, Rule 92(1) of the CPC but it acquires the attribute of finality or becomes absolute only on the termination of the proceedings started to set aside the court sale or to set aside the order confirming the same.
11. Even though the application to set aside the sale was filed after the order of confirmation of the sale of item 1, it was alleged that the judgment-debtor got knowledge of the sale of item 1 only on the date of the filing of the petition, as he was kept out of the knowledge of execution proceedings on account of the fraud of the decree-holder.
12. Though the petition to set aside the sale was filed after the order of confirmation of court sale in respect of item 1, it was filed within three years of the order confirming the sale. The court sale of item 1 also therefore became absolute only on 19-10-1958, the date on which the petition to set aside the court sale was dismissed on the merits. In this connection it is necessary to quote the observation of the Privy Council in Bassu Kaur v. Dhum Singh, (1889) ILR 11 All 47 (PC) wherein it was observed:
“It would be an inconvenient state of the law if it were found necessary for a man to institute a perfectly vain litigation under peril of losing his property if he does not. And it would be a lamentable state of the law if it were found that a debtor who for years has been insisting that his creditor shall take payment in a particular mode, can when it is decided that he cannot enforce that mode, turn round and say that the lapse of time has relieved him from paying at all.”
13. In this view, it has to be held that the second appeal is without any substance. It is therefore dismissed with costs.
BK/AGJ/D.V.C
14. Appeal dismissed.
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