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TMI Blog1995 (2) TMI 359X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent No. 1 herein was one of the bidders and his bid being highest for Rs. 31500/-, it was knocked down in his favour. The Sale Officer taking the bid made by respondent No. 1 to be adequate and reasonable accepted the same and directed the respondent No. 1 to deposit 25 per cent of the bid amount at once and the balance of the sale amount within IS days by his order dated 18.10.1973. The respondent No. 1, auction purchaser depos- ited a sum of Rs. 8000/- by means of a cheque dated 18.10.1973 which was encashed and accounted for in Tehsil account on 22.10.1973 and the balance of the bid amount Rs. 23500/- was deposited in cash on 30.10.1973 well within the time stipulated by Rule 285-E of the said rules. The deceased Rao Mahmood Ahmad Khan filed an objection on 17.11.1973 for setting aside the auction sale, inter-alia on the grounds that 1/4th of the bid amount was not deposited as required by law and that the auction was fictitious and collusive, for the reason that the very same property when put to auction, earlier in 1969 the highest bid offer was Rs. 50,000/ but same was rejected by the sale officer Saharanpur on the ground that the bid money was inadequate as compare ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orms Rules, 1952 (hereinafter referred to as the Rules) are mandatory and have to be strictly applied in so far as the requirement of deposit of 25 per cent of the amount of bid immediately after the declaration of the person to be the purchaser of the property is concerned and on his failure to do so the sale becomes a nullity. He submitted that in the present case the sale was knocked down in favour of the respondent No. 1 on 18.10.1973 and, therefore, it was obligatory on him to deposit 25 per cent of the bid amount immediately on 18.10.1973 itself but he did not do so. On the contrary the respondent No. 1 is said to have delivered a cheque of 25 per cent of the purchase money on 18.10.1973 which is said to have been encashed on 22.10.1973 which under the provisions of Rule 285-D could not be said to be a valid deposit. The learned counsel for the appellants, therefore, strenuously urged that the High Court had fallen in grave error of law in accepting the deposit of 25 per cent of the bid amount by cheque as a 'valid deposit by taking a view contrary to a Division Bench decision of the Allahabad High Court rendered in Hira Lal v. Mst. Champa [ A.I.R 1955 Allahabad 226]. It was, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er payment of the full amount of the purchase money before the court closes on the 15th day from the date of sale of property and in the event of default to do so the property shall be re-sold with the only distinction that in the case of default under Order 21, Rule 86 the Court has the discretion to forfeit to the Government 25 per cent of the bid amount deposited on the date of sale while in the case of default under Rule 285-E of the Land Reforms Rules there is no such discretion but in the event of default to deposit the full amount of purchase money, 25 per cent deposit has to be forfeited after defraying the expenses of re-sale. Similarly the provisions contained in Order 21, Rule 87 of the Code are similar to the provisions contained in Rule 285-G of the Land Reforms Rules. 9. A perusal of the language employed in Rule 285-D would go to show that it requires the person declared to be purchaser to deposit immediately 25 per cent of the amount of his bid, and in default of such deposit the property shall be resold forthwith and such person who failed to deposit 25 per cent of the bid amount shall be liable for the expenses incurred in the first sale and the deficiency of pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty shall be put to re-sale forthwith without any loss of time or postponement of the date of re-sale. The provision has been made mandatory because if the property is not re- sold forthwith and on the same day but later on after a day or two, the sufficient number of purchasers may not be forthcoming and the property may not fetch adequate and fair price to the prejudice of the judgment debtor. There is yet another reason for making this provision mandatory and it is this that if on the failure of the purchaser to deposit 25 per cent of the bid amount immediately and on the day the person is declared to be purchaser then the sale of the property will have to be postponed to some other date and according to the provisions contained in Rule 25-G re- produced in para 6 above, no sale after the postponement under Rule 285-D in default of payment of the purchase money shall be made until a fresh proclamation has been issued as prescribed for the original sale. it is to avoid this situation and the delay in the sale that a provision under Rule 285-D has been made mandatory and on the failure of compliance of the same the sale becomes a nullity. 11.The controversy whether the provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding to the learned counsel for the appellants neither the deposit of 25 per cent of the bid amount was made in cash nor by cheque on 18.10.1973 as the cheque was encashed on 22.10.1973. While according to the learned counsel appearing for the auction purchaser respondent No. 1 the cheque was tendered on 18.10.1973 itself which was encashed on 22.10.1973 and the amount was deposited in the Government treasury on 22.10.1973. The question is whether such a payment by cheque could be regarded as a valid deposit within the, meaning of Rule 285-D. As discussed above Rule 285-D is a mandatory rule according to which if 25 per cent of the bid amount is not deposited immediately the land shall forthwith be again put up and sold. In other words on the failure of the purchaser to deposit 25 per cent of the bid amount immediately the land shall be re- sold immediately the land shall be re- sold immediatety after such failure the very same day. If for instance the 25 per cent of the bid amount is accepted by cheque and subsequently the purchaser changes his mind and advises his banker not to encash the cheque or there is no amount in the account of the purchaser in the bank and the cheque is b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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