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B. Rajambal . v. Thangam Alias Senthivel Asari And Others
Factual and Procedural Background
This appeal arises from an order of the Additional Subordinate Judge of Madura dismissing the appellant's application dated 4 April 1932 under Order 34, Rule 6, Civil P.C., for a personal decree on the ground that the application was time-barred. The parties agreed that Article 181 of the Limitation Act applied, which prescribes a three-year period "from the time when the right to apply accrues."
Relevant events and dates as recorded in the opinion:
- Sale of the mortgaged property in court auction: 12 October 1925.
- Application by the judgment-debtor to set aside the sale (on ground of fraud/irregularity) was dismissed on 22 February 1926, and on that date the sale was confirmed by the lower court.
- The judgment-debtor appealed against the dismissal; the appellate court (High Court) dismissed that appeal on 10 November 1930.
Legal Issues Presented
- When does the right to apply for a personal decree under Order 34, Rule 6, Civil P.C. accrue for the purpose of Article 181, Limitation Act: upon confirmation of the sale by the subordinate court, or only after an appellate court has finally disposed of an appeal affecting the validity of that sale?
- Whether, when there is an appeal challenging the validity of a sale in execution, limitation begins to run at the subordinate court's confirmation of the sale or at the disposal of the appeal (i.e., when the sale becomes absolute).
Arguments of the Parties
Appellant's Arguments
- The appellant contended (in the lower court and on appeal) that the right to apply for a personal decree accrued only on the date the High Court dismissed the judgment-debtor's appeal (10 November 1930), and therefore the application dated 4 April 1932 was within the three-year period under Article 181.
- In support of this position the appellant relied on authority including Chandramani Shab v. Anarjan Bibi (Privy Council decision) as to when time begins to run where an appellate disposal is involved.
Respondents' Arguments
- The respondents argued successfully in the lower court that the right to apply accrued on the date the sale was confirmed by the Subordinate Judge (22 February 1926), and that the application was therefore time-barred under Article 181.
- The respondents relied on precedents (including Krishnabandhu Ghatak v. Panchkari Saha and Pell v. Gregory) to support the proposition that the right to apply accrues when the court confirms the sale and that uncertainty from an appeal does not of itself suspend the running of the statutory period.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court in This Opinion |
|---|---|---|
| Chandramani Shab v. Anarjan Bibi, 1934 PC 134 | Held that under Article 180 (Limitation Act) where there is an appeal the "time when the sale becomes absolute" is when the appellate court disposes of the appeal; the three-year period for a purchaser's application runs from the date of the order on appeal. | The court relied on the Privy Council's reasoning to conclude analogously that where an appeal is pending the right to apply for a personal decree does not accrue until the sale is finally determined on appeal (i.e., becomes absolute). |
| Nagendranath De v. Sureshchandra De, 1932 PC 165 | Interpreted Article 182(2) and recorded the principle that, so long as a question is sub-judice between parties, those affected should not be compelled to pursue execution which may prove fruitless if the final result is against them. | The court cited these words to support the view that the presence of an appeal keeping the validity of the sale sub-judice prevents the decree-holder's right to apply from accruing until final determination. |
| Jowad Hossain v. Gendan Singh, 1926 PC 93 | Held that where there has been an appeal from a preliminary mortgage decree, the period of three years under Article 181 for application under Order 34, Rule 5 runs from the date of the appellate court's decree (not from the expiry of payment time in the preliminary decree). | The court applied the same rule by analogy to an application under Order 34, Rule 6, holding that the limitation period starts from the appellate decree where the right to a personal decree depends on the disposal of an appeal. |
| Venkayy v. Sathiraju, 1921 Mad 414 | Held that an application for a final decree for sale under Order 34, Rule 5 is governed by Article 181, and where there has been an appeal from the preliminary decree the starting point is the date of the appellate decree. | The court relied on this decision as further support for treating the appellate decree as the triggering event for limitation where appeals affect the right to a personal decree. |
| Krishnabandhu Ghatak v. Panchkari Saha, 1931 Cal 166 | Held (at first instance) that the right to apply for a decree for the balance under Order 34, Rule 6 does not accrue until the court has put a seal of finality by confirming the sale under Order 21, Rule 92; once that right has accrued time begins to run — and uncertainty by itself need not suspend the Statute. | The court distinguished this decision: noting that in Krishnabandhu there was no appeal from the court's order under Order 21, Rule 92, so observations about waiting until an appeal is disposed of were obiter; the present court expressed disagreement with applying Krishnabandhu to cases where an appeal is pending. |
| Pell v. Gregory, 1925 Cal 834 (Full Bench) | Held the period of limitation for an application for a personal decree under Order 31, Rule 6 is three years and that Article 181 applies to such applications. | The court noted that Pell v. Gregory involved no appeal and therefore offered no assistance to the present case where an appeal was pending; it was not followed as persuasive authority for the appeal-situation. |
| Juscurn Boid v. Pirthichand Lal Choudhary, 1918 PC 151 | Privy Council held that where an auction purchaser sued to recover purchase money because a sale was set aside, time ran from when the sale itself was set aside in the first court and did not begin afresh when the order was affirmed on appeal. | The court treated this case as distinguishable from the present facts and therefore of limited assistance. |
Court's Reasoning and Analysis
The court's reasoning follows a sequence grounded in the relationship between the Limitation Act and the finality of a sale in execution when appeals are pending:
- Agreement that Article 181 of the Limitation Act applies to applications under Order 34, Rule 6 (three-year period measured from "the time when the right to apply accrues").
- The court examined the timeline: sale (12 Oct 1925); dismissal of the judgment-debtor's initial application to set aside and confirmation of sale by the Subordinate Judge (22 Feb 1926); dismissal of the High Court appeal (10 Nov 1930); and the subsequent application by the decree-holder (4 Apr 1932).
- Relying on the Privy Council authority in Chandramani Shab (interpreting Article 180) the court adopted the principle that where an appeal exists the sale does not become "absolute" for limitation purposes until disposal of the appeal by the appellate court. The court extended that reasoning by analogy to Article 181 and to applications for a personal decree under Order 34, Rule 6.
- The court emphasized the practical legal consequence that, until the sale is finally determined (i.e., becomes absolute), it cannot be known whether the sale proceeds are sufficient to satisfy the decree — a precondition to awarding a personal decree for any deficiency. If the decree-holder were forced to apply while the validity of the sale remained sub-judice, execution of any personal decree might prove fruitless if the sale were later set aside on appeal.
- The court reinforced this approach by reference to Nagendranath De v. Sureshchandra De (the Privy Council) which endorsed the intelligible rule that parties should not be compelled to pursue execution while a material question is sub-judice, and to Jowad Hossain and Venkayy v. Sathiraju which apply Article 181 from the date of the appellate decree where appeal affects the right to apply.
- The court considered and distinguished contrary authorities relied on by the respondents (notably Krishnabandhu Ghatak and Pell v. Gregory), observing that in those cases there had been no appellate challenge to the court's confirmation of sale and that remarks about waiting for appeal disposal were obiter; accordingly those decisions were not treated as controlling when an appeal exists.
- On that basis the court concluded that where an appeal is pending the decree-holder's right to apply for a personal decree under Order 34, Rule 6 does not accrue until the sale becomes absolute on final disposal of the appeal; limitation therefore runs from that later date.
Holding and Implications
HOLDING: The court allowed the appeal and held that, where there is an appeal affecting the validity of a sale in execution, the decree-holder's right to apply for a personal decree under Order 34, Rule 6 accrues only when the sale becomes absolute on disposal of the appeal (i.e., from the date of the appellate decree). Consequently the lower court's order dismissing the appellant's application as time-barred was set aside.
Direct consequences for the parties:
- The appellant's appeal succeeds; the lower court's dismissal of the application dated 4 April 1932 is set aside.
- The application is to be disposed of according to law (i.e., consistent with the court's ruling on accrual and limitation).
- The appellant is awarded costs here and in the lower court.
Implications for legal practice: The opinion applies established Privy Council authority and analogous decisions to hold that, when an appeal keeps the validity of a sale sub-judice, limitation under Article 181 begins to run only after the appellate court has finally disposed of the matter. The opinion distinguishes prior decisions that involved no appeal and therefore does not adopt those cases as controlling in the appeal-situation.
1. This is an appeal from an order of the Additional Subordinate Judge of Madura, dismissing She appellant's application, dated 4th April 1932, under Order 34, Rule 6, Civil P.C., for a personal decree on the ground that the application was time barred. It was agreed in the lower Court that Aris 181, Lim. Act, applies to this case. That article gives a period of three years from 'the time when the right to apply accrues. The sale of the property in Court auction took place on 12th October 1925. There was an application to set aside the sale on the ground of fraud or irregularity, which was dismissed on '22nd February 1926 upon which date the sale ?was confirmed. The judgment, debtor ?filed an appeal against the order of dismissal and that appeal was dismissed 'toy the High Court on 10th November 1930. The dispute is as to when the right to apply under Order 34, Rule 6, Civil P. C, accrued. The respondents successfully contended in the lower Court that "the right accrued on the date of the confirmation of the sale, namely 22nd February 1926. If that contention is correct, then the application was clearly time-barred. The appellant contended an the lower Court and here that the right accrued only on the date of the dismissal of the appeal in which case the application was in time. In support of this appeal reference was made to Chandramani Shab v. Anarjan Bibi 1934 PC 134, a decision of the Privy Council.
2. In that case the Subordinate Judge ?disallowed the application under Order 21, Section. 90 to set aside a sale in execution and made ah order under Rule 92(1) confirming the sale and there was an appeal from that disallowance to the High Court which was dismissed; and it was held that the three years' period provided by the Limitation Act, 1908, Schedule 1, Article 180, for an application under Order. 21, Rule 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, Section 107(2), the same powers as the Subordinate Judge and the "time when the sale becomes Absolute" for the purpose of Article 180 is when the High Court disposes of the appeal. It is true that that case is a decision upon an application by the purchaser for delivery of possession and is a decision upon Article 180 under which time does not begin to run until the sale has become absolute, whereas under Article 181 time begins to run from the date when the right to apply accrues; but it seems to me that until the sale has become absolute, which according to their Lordships of the Privy Council, where there is an appeal, is not until the date of the appellate order, it has not been finally determined whether the sale proceeds ore or are not sufficient to satisfy the, decree-holder's decree and that until that has been ascertained, the decree-holder cannot apply for a personal decree. If the judgment-debtor's appeal against the order dismissing his application to set aside the sale had been successful in the High Court, the sale would have been set aside and a re-sale would have taken place which might have resulted in there being an even larger deficiency or no deficiency at all. Although the sale was confirmed upon the dismissal of the judgment-debtor's application, by reason of the appeal the question of whether there was or was not a deficiency was thus re-opened. On p. 952 their Lordships say:
In considering the meaning of the words in Article 180, Lim. Act, it is useful to consider the converse case. Take a case in which the Subordinate Judge allowed the application to set aside the sale; in that case, of course, there could be no confirmation of the sale as far as. the Subordinate Judge was concerned as there would be no sale to be confirmed. But if, on appeal, the High Court allowed the appeal, and disallowed the application to set aside the sale, the High Court would then be in a position to confirm the sale, and, on such an order of confirmation by the High Court, the sale would become absolute. Again, take a case in which the Subordinate Judge disallowed the application to set aside the sale; there would then be confirmation of the sale by the Subordinate Judge and the sale would become absolute as far as his Court was concerned. If the High Court allowed an appeal, and set aside the sale, there would then be no sale, and, of course, no confirmation and no absolute sale;
and again:
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, 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 application.
3. I am clearly of the view that, where there is an appeal, the decree-holder's right to apply for the personal decree does not accrue until the sale has be-' come absolute. In considering Article 182(2) Lim. Act, their Lordships of the Privy Council stated in Negendrnath De v. Sureshchandra De 1932 PC 165:
It is at least an intelligible rule that, so long as there is any question sub-judice between any of the parties, those affected shall not be compelled to pursue the so-often thorny path of execution, which, if the final result is against them, may lead to no advantage. Nor, in such a case as this, is the judgment-debtor prejudiced. He may indeed obtain the boon of delay, which is so dear to debtors, and, if he is virtually inclined, there is nothing to prevent his paying what he owes into Court.
4. Those words seem to be particularly applicable to this case. By reason of the appeal there an all-important question was sub-judice between the parties, namely, whether the sale should be set aside or whether it should be confirmed. If, during the pendency of that appeal, the decree-holder had applied for a personal decree and executed that decree, and if the final result of the appeal had been the setting aside of the sale, the personal decree would have been of no advantage to the decree-holder and he would have been compelled to waste time and money all to no useful purpose. In Jowad Hosasain v. Gendan Singh 1926 PC 93, it was held by the Privy Council that where there has been an appeal from a preliminary mortgage decree, the period of three years within which, under the Limitation Act, Schedule 1, Article 181, an application for a final decree under Order 34, Rule 5, Sub-rule 2, must be made, runs from the date of the decree of the appellate Court, not from the expiry of the time for payment fixed by the preliminary decree. In Venkayy v. Sathiruju 1921 Mad 414, it was hold by Wallis, C. J., and Oldfield, J., chat an application for a final decree for sale under Order 34, Rule 5, Civil P. C, is governed by Article 181, Lim. Act, and the starting point, in cases where there has been an appeal from the preliminary decree, is the date of the appellate decree whether the latter confirmed or varied the preliminary decree. The respondents relied upon Krishnabandhu Ghatak v. Panchkari Saha 1931 Cal 166 where it was held that the right to apply for a decree against the defendant for the balance, under Order 34, Rule 6, Civil P. C, does not accrue until the Court has put a seal of finality to the proceedings by confirming the sale-under Order 21, Rule 92 and that, once this right has accrued, time begins to run, and the uncertainty caused by an appeal or other proceedings taken need not by itself be held sufficient to suspend the operation of the Statute or to entitle the plaintiff to get a deduction. This was a decision of Mukerji and Mifcter, JJ., but in that case there was no appeal from the Court's order under Order 21,. Rule 92, Civil P. C, and the observations of the Bench with regard to the right of the decree-holder to wait until an appeal is disposed of were merely obiter and with great respect I am unable to-agree with them. Another case relied upon by the respondents was a Full Bench decision of the Calcutta Highs Court, namely Pell v. Gregory 1925 Cal 834, where it was held that the period of limitation for an application for personal decree under Order 31, Rule 6, Civil P.C, is three years and Art 181, Lim. Act, applies to such applications. In that case, unlike the present one, there had been no appeal and that case is of no assistance to the respondents nor is Juscurn Boid v. Pirthichand Lal Choudhary 1918 PC 151, a decision of the Privy Council of assistance. In that case an auction, purchaser sued to recover from certain decree-holders his purchase money in consequence of the sale being set aside. The Privy Council held that, assuming that Article 97 was the article applicable,, consideration failed when the sale itself was set aside in the first Court, that time began to run under Article 97 and that consideration did not fail afresh when the order setting aside the sale was affirmed by the appellate Court. The: distinction between that case and Venkayy v. Sathiraju 1921 Mad 414, already referred to, is pointed out by Wallis, C. J., on p. 716.
5. The result is that this appeal succeeds and the lower Court's order dismissing, the application must be set aside and the application must accordingly be disposed of according to law. The appellant will get her costs here and in the lower Court.
Cornish, J.
6. I agree. A personal decree could not have been made until it had been ascertained whether the sale proceeds of the mortgaged property were insufficient to pay the amount due under the decree, and this could not be discovered until the validity of the sale had been finally determined. Trie judgment-debtor impeached the validity of the sale. His application to have it set aside was dismissed, and the lower Court's order was upheld on appeal. In these circumstances, while the judgment-debtor's proceedings to set aside the sale were pending, can the decree-holder's right to apply for a personal decree under Order 34, Rule 6, be said to have accrued? I think not. Suppose the decree-holder had made application for a personal decree while the appeal was pending, he would at once have been met with the objection that the question of the sale was sub-judice, and that until this has been finally settled it was impossible to determine whether there was an insufficiency of sale proceeds to satisfy the mortgage decree. It has been held by their Lordships of the Judicial Committee in Jowad Hossain v. Gendan Singh 1926 PC 93, that where there has been an appeal from a preliminary mortgage decree the starting point of limitation imposed by Article 181 upon an application under Order 34, Rule 5, is the date of the appellate Court's decree and not the date fixed for payment in the preliminary decree. There is no apparent reason why the same rule should not be applied when the proceedings in the suit have reached a later stage, and when the right of the decree-holder to a personal decree under Rule 6 is dependent on the determination of an appeal relating to the validity of the sale of the mortgaged property under the final decree. To hold otherwise might, as their Lordships have pointed out in Nagendranath De v. Sureshchandra De 1932 PC 165, result in compelling the decree-holder to take a fruitless step.
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