1993 (9) TMI 350 - SC - Indian Laws

Summary

Issues Involved:
1. Jurisdiction of the Execution Court
2. Validity of the Sale Proceedings
3. Service of Notice and Settlement of Proclamation of Sale
4. Adequacy of Sale Price and Collusion Allegations
5. Compliance with Procedural Requirements under CPC

Summary:

1. Jurisdiction of the Execution Court:
The appellant contended that the Execution Court lacked jurisdiction as its pecuniary limit was Rs. 25,000, whereas the property value was Rs. 3,50,000. The Supreme Court held that the value of the property sold in execution does not affect the jurisdiction of the trial court, as per Order 21 Rule 10 CPC. The decree amount of Rs. 7,780.33 was within the court's jurisdiction.

2. Validity of the Sale Proceedings:
The appellant argued that the sale was collusive and fraudulent, with the property being sold for an inadequate price of Rs. 1,05,000 against its actual value of Rs. 3,50,000. The Supreme Court noted that the Execution Court failed to follow due procedure, including the lack of notice to the appellant and improper settlement of the sale proclamation, rendering the sale invalid.

3. Service of Notice and Settlement of Proclamation of Sale:
The appellant was not served notice under Order 21 Rule 54 or Order 21 Rule 66 CPC. The Supreme Court emphasized the mandatory nature of these notices, stating that the absence of notice to the judgment-debtor is a fundamental procedural lapse. The court highlighted that the proclamation of sale must be settled with notice to both parties, specifying the time and place of sale and other essential details.

4. Adequacy of Sale Price and Collusion Allegations:
The appellant claimed the sale was for an inadequate price and was collusive. The Supreme Court found merit in these claims, noting that the Execution Court did not attempt to sell a portion of the property to satisfy the decree, thus causing substantial injury to the appellant. The court stressed that the sale of the entire property for a small decree amount was excessive and not in compliance with Order 21 Rule 64 CPC.

5. Compliance with Procedural Requirements under CPC:
The Supreme Court found several procedural irregularities in the execution process, including the failure to settle the sale proclamation judicially and the lack of proper notice to the appellant. The court reiterated the importance of strict compliance with procedural requirements to ensure fairness and transparency in execution sales.

Conclusion:
The Supreme Court set aside the sale and the confirmation of the sale. The appellant was directed to withdraw the deposited amount and deposit it towards the decree amount, with the Rent Controller and Subordinate Judge facilitating the payment and recording full satisfaction. The auction-purchaser was allowed to withdraw his deposited amount with interest. The appeal was allowed with no costs.