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Mt. Dhanwanti Kuer Judgment-Debtor v. Sheo Shankar Lall Decree-Holder Opposite Party.
Structured Summary of the Provided Opinion
Factual and Procedural Background
The proceedings concern an application under Order 21, Rule 89 (O.21, R.89) of the Code of Civil Procedure (CPC) to set aside an execution sale by making a deposit. The property was sold in execution of a decree described in the opinion. The opinion records that the property was sold in execution on 4th December, 1919 as belonging to the judgment-debtor Dhanwanti Kuer. The judgment-debtor is recorded as having disposed of the property on 22nd December, 1917 and applied on 2nd January, 1918 to have the sale set aside by depositing the necessary amount in Court.
At first instance the Subordinate Judge entertained the application. The learned District Judge disagreed with the Subordinate Judge and held that the judgment-debtor had no locus standi under O.21, R.89 because she did not own the property at the date of the application. The present opinion reviews that disagreement and determines whether the District Judge's order should be set aside and the Subordinate Judge's order restored.
Legal Issues Presented
- Whether the question whether a person (specifically a judgment-debtor who sold the property after the auction sale) has the necessary legal character to apply under O.21, R.89 is a question involving jurisdiction such that an erroneous decision on it is open to revision under Section 115 of the CPC.
- Whether a judgment-debtor who has parted with the property after an auction sale (by making a private sale subsequent to the auction sale) may nonetheless apply under O.21, R.89 to set aside the execution sale by depositing the purchase-money.
- What is the proper construction of the amended language in O.21, R.89 (the words added to Section 310-A of the former Code) — specifically, whether the qualification "any person either owning such property or holding an interest therein by virtue of a title acquired before such sale" must be satisfied at the time of the application.
Arguments of the Parties
Opposite Party's Arguments (as recorded)
- The learned vakil for the opposite party took a preliminary point that no question of jurisdiction was involved; the Court only had a right to decide whether a judgment-debtor who has sold his property subsequent to the sale is entitled to make a deposit under O.21, R.89 and, if the Court has erred in law in so deciding, such an error does not constitute illegality or material irregularity in the exercise of jurisdiction.
Petitioner's / Judgment-Debtor's Arguments (as recorded)
- The judgment-debtor (petitioner) sought to apply under O.21, R.89 by offering to deposit the requisite amount to set aside the execution sale.
- A further point advanced on behalf of the petitioner (challenging the decree-holders) was that the decree-holders had not obtained a valid title to the property and that the judgment-debtor remained the owner: specifically, it was contended that the judgment-debtor was not holding the estate of a Hindu widow, and that a deed of release executed by her was not sufficiently stamped and therefore could not be treated as a conveyance transferring the property to Namdeo.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Malkarjan v. Narhari | Referenced in relation to a preliminary jurisdictional point (Mullick, J. states the principles of Malkarjan do not apply). | The court held that the principles of Malkarjan v. Narhari do not apply to the jurisdictional question under consideration. |
| Balkrishna Udayar v. Vasudeva Aiyar | Authority for the proposition that the question whether an applicant has the necessary legal character may be a matter of jurisdiction. | Mullick, J. relied on this decision as authority that a decision on whether an applicant fulfills the character required by R.89 is a jurisdictional question. |
| Maganlal v. Doshi Mulji (Jenkins, C.J.) | Holds that Section 310-A enabled a judgment-debtor to make a deposit who had sold the property after the sale. | Cited as an example of authority supporting the view that a judgment-debtor who sold after the sale may still make a deposit under the earlier provision. |
| Ishar Das v. Asnf Ali | One view (Allahabad High Court) that unless the applicant is, at the time of the application, an owner or holds an interest, he cannot obtain the benefit of the rule. | Presented as one side of a conflict of decisions under the older Code; relied upon to describe divergent authorities. |
| Subbarayadu v. Lakshminarasamma | Similar view (Madras High Court) that the applicant must be owner or hold interest at time of application. | Also cited to illustrate contrary holdings under the older Code. |
| Pandurang Laxman Uphade v. Govinda Dada Uphade (Bombay Division Bench) | Considered the conflicting authorities and stated the object and scope of the rule (interpreting the amendment to R.89). | The court expressed agreement (with respect) that the Bombay Division Bench correctly stated the object and scope of the rule and adopted its construction in the present case. |
| Bhawani Kumar v. Mathura Prasad Singh (Privy Council) | Held that property passes from the judgment-debtor to the auction purchaser at the moment of the sale irrespective of the time of confirmation. | Mullick, J. relied on this principle to note that after the auction sale the judgment-debtor retains no transferable interest; this fact informed the analysis of when the qualifying interest must be assessed. |
Court's Reasoning and Analysis
The opinion contains two principal reasoned judgments (Mullick, J. and Jwala Prasad, J.) that converge on the result. The court's analysis proceeds through the following steps, stated as they appear in the text:
-
Jurisdictional character of the question:
Mullick, J.
Mullick, J. first addressed a preliminary contention that no question of jurisdiction was involved and that an erroneous decision on the legal entitlement to make a deposit would not amount to illegality or material irregularity. He rejected that contention for the present facts. He explained that the Court could only adjudicate upon an application if it was presented by a person fulfilling the character required by R.89, and the Court's decision on whether the applicant has the necessary legal character is "clearly a question involving jurisdiction." He distinguished errors in law or fact made after jurisdiction has been legally assumed (which are normally not revisable under Section 115 of the CPC) from decisions that go to the foundation or basis of jurisdiction, which are revisable; he cited Balkrishna Udayar v. Vasudeva Aiyar as authority.
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Effect of the amendment to O.21, R.89:
Both judges' views
The court reviewed that O.21, R.89 amends the former Section 310-A by inserting the words "any person either owning such property or holding an interest therein by virtue of a title acquired before such sale." Mullick, J. observed that those amending words widened the operation of the rule to let in persons who are not parties to the execution proceedings. The court confronted a conflict in earlier authorities: some courts (Allahabad and Madras) had held the applicant must be an owner or holder of an interest at the time of application, while the Bombay Division Bench had adopted a broader view. The court treated these conflicting authorities as integral to deciding the correct construction of the amendment.
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Effect of auction sale on the judgment-debtor's interest:
Mullick, J.
Mullick, J. noted the Privy Council's statement in Bhawani Kumar v. Mathura Prasad Singh that property passes from the judgment-debtor to the auction purchaser at the moment of the sale irrespective of confirmation. From this premise he observed that, strictly speaking, the judgment-debtor retains no transferable interest after the sale. He distinguished between a right to make a deposit (a right granted by the rule) and a transferable proprietary interest, concluding that if the qualification in R.89 were read to require ownership or interest at the time of application, the judgment-debtor (one of the persons for whose benefit the rule was enacted) would be rendered incompetent to apply.
To avoid defeating the object of the amendment (which the court construed as widening access to the remedy and not curtailing the judgment-debtor's pre-existing right), Mullick, J. read the qualification as referring to the moment immediately before ownership passed (i.e., the time of the execution sale), thereby allowing a judgment-debtor who sold privately after the auction sale to apply.
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Treatment of subsidiary title issues:
Mullick, J.
The court recorded that the Subordinate Judge could decide questions raised about the validity of the decree-holders' title and the sufficiency of the stamp on the deed of release after jurisdiction was assumed. These title questions were not necessary to found jurisdiction and thus, whether they were rightly or wrongly decided was immaterial for the purposes of revisional jurisdiction under Section 115 CPC.
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Conclusion on jurisdiction and remedy:
Mullick, J. and Jwala Prasad, J.
Mullick, J. concluded that the learned District Judge wrongly refused to exercise jurisdiction in declining to accept a deposit from the judgment-debtor. Therefore, under Section 115 of the CPC, the District Judge's order was set aside and the Subordinate Judge's order restored with costs throughout.
Jwala Prasad, J. agreed. He acknowledged the divergence in earlier authorities and the difficulty in construction, but after considering the object and scope of the Rule and a "true construction" of its words concluded that the rule was not intended to curtail the judgment-debtor's pre-existing right under the old Code. He reconstructed the provision (leaving out surplus words) to show it carries effectively the same import as the earlier wording ("any person whose immovable property has been sold may apply...") and held that the judgment-debtor should not be deprived of the right to apply merely because he parted with the property after the execution sale. He expressly declined to decide whether the judgment-debtor had any transferable interest after the sale and before confirmation.
Holding and Implications
Holding: The District Judge's order refusing to accept a deposit from the judgment-debtor was set aside and the order of the Subordinate Judge was restored with costs throughout. The court held that the question whether the applicant had the necessary legal character under O.21, R.89 was a matter of jurisdiction and that the judgment-debtor could apply under the rule despite having disposed of the property after the auction sale, on the construction adopted.
Implications:
- The direct effect of the decision is that the Subordinate Judge's order (which entertained the judgment-debtor's application and accepted the deposit) is restored and the District Judge's contrary order is set aside, with costs awarded in favor of the successful party below.
- The opinion addresses the interpretation of O.21, R.89 and sides with the view that the amendment was meant to widen the scope of the rule and not to curtail the judgment-debtor's prior right; it thereby permits a judgment-debtor who disposed of the property after the execution sale to apply under R.89. Beyond this immediate effect, the opinion discusses prior conflicting authorities and adopts the Bombay Division Bench's construction, but the text does not describe any novel, sweeping precedent beyond resolving the dispute between the courts in the present circumstances.
This summary is based exclusively on the material contained in the provided opinion and does not add or infer facts or holdings beyond the text.
Mullick, J.:— A preliminary point is taken by the learned vakil for the opposite party that no question of jurisdiction involved; that the Court had a right to decide whether or not a judgment-debtor who has sold his property subsequent, the sale is entitled to make a deposit under O. 21, R. 89, and if the Court has made an error of law in deciding the joint that error does not constitute any legality or material irregularity in the exercise of jurisdiction. In my opinion he principles of Malkarjan v. Narhari(1) do not apply. Here the Court could only adjudicate upon the application, if was presented by a person fulfilling he character required by R. 89. The Court's decision upon the point whether;he applicant has the necessary legal character is clearly a question involving jurisdiction. An erroneous decision on a Ration of law or fact, after jurisdiction his been once legally assumed, would not in a ground for interference under Section 115 of the CPC, but if the decision is the ??? basis and foundation of jurisdiction in its limited sense as distinguished from powers, it at once comes within the purview of the section. The judgment of their Lordships of the Privy Council in Balkrishna Udayar v. Vasudeva Aiyar(2) is, in my opinion, authority for this view.
2. The next question is whether the decision of the Subordinate Judge should be restored. Now O. 21, R. 89, amends Section 310-A of the former CPC, by which deposits could be made by any person whose immovable property had been sold. The amending words.
“any person either owning such property or holding an interest therein by virtue of a title acquired before such sale”
have, by letting in persons who are not parties to the execution proceedings, clearly widened the operation of the rule. Bearing this in mind as the object of the amendment, how has it affected the judgment-debtor? The statute itself does not set at rest the conflict of decisions under the older Code, in illustration of which it is only necessary to state that while Jenkins, C.J, in Maganlal v. Doshi Mulji(3) held that S. 310-A enables a judgment-debtor to make a deposit who had sold the property after the sale, their Lord ships of the Allahabad and Madras Courts In Ishar Das v. Asnf Ali(4) and in Subbarayadu v. Lakshminarasamma(5) took the view that unless the applicant is, at the time of the application, an owner, or holds an interest in the property, he cannot get the benefit of the rule. These authorities have been carefully considered by a Division Bench of the Bombay High Court in Pandurang Laxman Uphade v. Govinda Dada Uphade(6), and I venture to think with great respect that the object and scope of the rule have been correctly stated in that judgment.
3. It seems to me that the matter really turns upon the effect of the auction sale. As has been observed by their Lordships of the Privy Council, the property passes from the judgment-debtor to the auction-purchaser at the moment of the sale irrespective of the time of confirmation: Bhawani Kumar v. Mathura Prasad Singh(7). If that is so, then the judgment-debtor retains no transferable interest after the sale. He may have a right to make a deposit, but that is not a right which can be transferred. For the purpose of making an application under R. 89, he can be neither an owner nor a person holding an interest in the property at the time of the application. If therefore R. 89, is to be limited to a person so qualified at the time of the application, then the judgment-debtor, who certainly is one of the persons for whose benefit the rule was enacted, is incompetent to apply. Therefore I think that the qualification must refer to the moment immediately before ownership passed. I agree with their Lordships of the Bombay Court in thinking that the law intended to assist the judgment-debtor if by making a private sale subsequent to the auction sale he could secure a better price for his property. A further point was taken by the learned vakil for the petitioner that the decree-holders had not obtained a valid title to the property, and that the judgment-debtor was still the owner thereof. It is contended first that the judgment-debtor was not holding the estate of a Hindu widow; and secondly, that the deed of release executed by her, not being sufficiently stamped, could not be treated as a conveyance transferring the property to Namdeo. Now these are questions which it was competent for the Subordinate Judge to decide after he had assumed jurisdiction. They are not necessary for the foundation of jurisdiction, and therefore whether they have been rightly or wrongly decided is immaterial for the purposes of Section 115 of the CPC. The result is that the learned District Judge has, in my opinion, wrongly refused to exercise jurisdiction in declining to accept a deposit from the judgment-debtor. Under Section 115 of the CPC, we set aside his order and direct that the order of the Subordinate Judge be restored with costs throughout.
4. Jwala Prasad, J.:— I agree that the question raised in this appeal as to whether the judgment debtor was entitled to apply under O. 21, R. 89 of the Code is one of jurisdiction, and the decision of the Courts below upon the point is there-fore subject to our revisional jurisdiction under S. 115 of the Code. The property, in dispute was sold in execution of a decree on 4th December, 1919 as belonging to the judgment-debtor Dhanwanti Kuer. She disposed of the property on 22nd December, 1917, and on 2nd January, 1918 applied to have the sale set aside on her depositing in Court the necessary amount. The learned District Judge, disagreeing with the Subordinate Judge, has held that the judgments debtor has no locus standi to make air application to set aside the sale under O. 21, R. 89, inasmuch as she did not at the date of the application own the property in question. It is contended on he behalf that the view taken by the learned District Judge is not correct in law. The point is not free from difficulty, and, as matter of fact has led to great divergency of opinion in the Courts that had hither to occasion to interpret the law in there, present Code. The Allahabad and the Madras High Courts have taken the view? that a judgment-debtor who, after the sale, has parted with the property is not entitled to come under O. 21, R. 89, whereas the Bombay High Court has taken a contrary view. The cases have already been referred to in the judgment of my learned brother. I have myself felt very great difficulty in making up my mind. In fact, the language in the aforesaid rule is not happily worded. After a careful consideration of the object and scope of the rule, as well as upon a true construction of it, I have come to the conclusion that the judgment-debtor is not deprived of his right to have the sale set aside under the aforesaid rule, which he undoubtedly had under the old Code. The words in the present Code,
“any person either owning such property or holding an interest therein by virtue of a title; acquired before such sale”
have been substituted for the words in the old Code “any person whose immovable property has been sold.” The property may be owned by the judgment-debtor, or it may be owned by some other person, and sold as the property of the judgment-debtor. It is with a view to allow such persons other than the judgment-debtor, as well as those who as of sharers or as mortgagees may have held some interest in the property by virtue of a title acquired before the sale, that the aforesaid amendment was made. The object of the amendment in the ??? is therefore not to curtail the right sf the judgment-debtor but to widen the scope of the rule by allowing persons other ??? the judgment-debtor to came in the words if a the rule therefore if not repugnant of her wise, should be so construed is to give effect to the intention of the ??? It is obvious that the intention of the legislature was not to take ??? or notice of any event ??? to the sale, for the rule expressly Recognizes only such interest in the property as may have been acquired before such; sale. Any act committed by the judgment-debtor affecting the property will not therefore be taken notice of by the Court in an application under R. 89, and hence the judgment-debtor's disposing of his property will not deprive him a the right to come in under that rule, peeping the above remarks in view, the Language in the rule, though not happily Worded, will, after careful consideration support the construction that the judgment debtor may, in spite of his having parted with the property, claim the benefit of the rule. Leaving out the words in the rule that do not apply to the present case, it will run as follows:
“Where immovable property has been sold in execution of a decree any person owning such property may apply to have the sale set aside.”
5. These words carry the same import as the words in the old Code:
“Any person whose immovable property has been sold may apply to have the sale set aside.”
6. It is obvious that any person owning immovable property at the time of its sale in execution of a decide may apply to have the sale set aside. The judgment-debtor, who has made the present application to set aside the sale under R. 89, will therefore clearly come under the said words. If it was intended that the owner of the property, such as the judgment-debtor owning so the property at the late of the sale, should not be allowed to apply on account of his having parted with the property by sale or otherwise subsequent to the execution sale, it would have been clearly stated in the rule. In the absence of a clear restriction upon the right, of a judgment-debtor, which he had at the time of the sale, it would be manifestly unjust to refuse the judgment-debtor the benefit of the rule.
7. It would beyond the scope of R. 89 to inquire to any transaction subsequent to the ??? and to find out the motives for such transaction. With great respect to the learned Judges of the other High Courts who have taken a contrary view, I am of opinion that the judgment-debtor's application was properly made and that the Court had no option but to entertain it. I therefore agree with the order proposed by my learned brother. I do not consider it necessary to give any opinion as to whether the judgment-debtor had any interest in the property after the sale and before the confirmation of the sale which he could validly transfer.
V.S/R.K
8. Order set aside.
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