B.K. Patra, J. -
(1.) THE short question that arises for determination in this case is whether a decree is satisfied either in whole or in part, as the case may be, by sale of the judgment debtor 's property, although the sale has not yet been confirmed. The opposite party obtained a mortgage decree against the Petitioners and in execution thereof brought the mortgaged property to sale. The sale was fixed to 18 -3 -1971. On 9 -3 -1971, the judgment -debtors filed an application under Section 13 of the Orissa Money Lenders Act, 1939 (Orissa Act III of 1939) (hereinafter referred to as the Act) praying for instalments. No application, however, was filed for stay of the sale which in due course took place on 18 -3 -1971. Although execution was levied to realise an amount of 2,536.98 p. by the sale of mortgaged property, the sale was knocked down only for Rs. 1,725/ - in favour of the decree -holder who had obtained necessary permission to bid at the auction. On 23 -8 -1971, the judgment -debtors made an application for stay of confirmation of the sale till disposal of their application under Section 13 of the Act (Misc. Case No. 112/71) and confirmation of the sale was stayed. During the pendency of the miscellaneous case the judgment -debtors paid Rs. 400/ - towards the decretal dues. The Misc. Case was disposed of on 28 -10 -1971. The executing Court held that the sale of the property followed by an order allowing set off had the effect of wiping out of the loan and the decree to the extent of the purchase money and consequently the relief that the judgment debtors would be entitled to would be confined only to the balance of Rs. 811.98 p. After adjusting the amount of Rs. 400/ - paid by the judgment -debtors towards the balance decretal dues amounting to Rs. 811.98 p., the Court directed that the balance should be paid by the judgment -debtors in quarterly instalments of Rs. 150/ - each. Aggrieved by this order, the judgment -debtors preferred an appeal to the District Judge. Cuttack who upheld the decision of the executing Court and dismissed the appeal.
(2.) SECTION 13 of the Act so far as is relevant may be quoted:
13. (1) Notwithstanding anything to the contrary contained in any other law or in anything having the force of law or in any contract between the money -lender and the person to whom the loan was advanced the Court may for reasons to be recorded in writing at any time, on the application of a judgment debtor, after notice to the decree -holder, direct that the amount of any decree passed before or after the commencement of this Act, in respect of a loan, including any decree in a suit relating to a mortgage by which a loan is secured, shall be paid in such number of instalments and subject to such conditions on the dates fixed by it as having regard to the circumstances of the judgment -debtor and the amount of the decree, it considers fit.
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What this section postulates is that in case of application under Section 13 is allowed, it is the amount of any decree passed in respect of a loan that would be paid in instalments. If there is no decree in existence at the time the order is passed, no relief can be obviously granted to the judgment -debtor. The question, therefore, is whether by reason of the sale, the decree either in whole or in part, as the case may be, is wiped out notwithstanding that the sale has not been confirmed. According to the Petitioners, the decree is not wiped out until the confirmation of the sale, because, it is argued, the sale is liable to be set aside on an application either under Rule 89 or Rule 90 of Order 21 of the Code of Civil Procedure, and it would not have been contemplated that a sale which was liable to be set aside would have the effect of wiping out the decree. Rule 92 of Order 21, provides 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. It is argued that it is only when the sale becomes absolute that the decree is wiped out to the extent of the amount realised by the sale and that till then the decree is kept alive. In support of this contention, reliance is placed on a Bench decision of the Madras High Court in Nataraja Fillai and Anr. v. Rangaswamy Karamundar, A.I.R. 1942 Mad 119. It was held in that case that where, in execution of a decree a sale is held and the decree -holder with leave of Court to bid and set off, purchases the property, the decree cannot be regarded as satisfied until the sale has been confirmed, and that, therefore, before confirmation of the sale an application by the judgment -debtor under Section 19. Madras Agriculturists Relief Act, lies on the basis of the decree subsisting. This decision completely supports the stand taken by the Petitioners.
A different view, however, had been taken in a series of decisions of the Calcutta High Court Nrishingha Charan Nandi v. Kedar Nath Chaudhury, A.I.R. 1957 Cal. 713 Ramendra Nath Mondal v. Dhananjoy Mondal : A.I.R. 1938 Cal. 261, Brojo Bashi Roy v. Nagarbashi Choudhury : A.I.R. 1938 Cal. 362, Jatendra Mohan Banik v. Surendra Mohan Roy : A.I.R. 1938 Cal. 549 and Bejoy Govinda Basu v. Noakhali Loan Office Ltd, : A.I.R. 1943 Cal. 119. All these are cases under Section 34 of the Bengal Agricultural Debtor 's Act, 1936 which provides that when an application under Section 8 or a statement under Sub -section (1) of Section 13 includes any debt in respect of which a suit or other proceeding is pending before a Civil or revenue Court, the Debt Settlement Board shall send a notice in the prescribed manner and thereupon the suit or the proceeding shall be stayed until the Board has either dismissed the application in respect of such debt or made an award thereon. In all these cases, notices under Section 34 of the Bengal Agricultural Debtor 's Act were received by the executing Court at a point of time which was after the sale of the judgment -debtor 's property but before the confirmation thereof. In Nrishingha Charan Nandi v. Kedar Nath Chaudhury, A.I.R. 1957 Cal. 713 the purchaser was the decree -holder himself. But in Jitendra Mohan Banik v. Surendra Mohan Roy : A.I.R. 1938 Cal. 549 and Nataraja Pillai and Anr. v. Rangaswamy Karamundar, A.I.R. 1942 Mad 119 the purchasers were strangers. The consistent view taken by the learned Judges in each of these cases was that at the time when the notice was received by the Court the execution case was no doubt pending but it was pending not in respect of a debt but in respect of confirmation of a sale already held. Moreover, the debt was no longer in existence on the date of receipt of the notice because once a sale has taken place the debt has ceased to exist to the extent of the purchase price and therefore there is no proceeding pending with regard to that amount of the debt in the Civil Court. It was pointed out in Brojo Bashi Ray v. Nagarbashi Choudhury : A.I.R. 1938 Cal. 362, that if subsequent to the sale an application either under Rule 89, or Rule 90 or Rule 91 of Order 21, Code of Civil Procedure is filed and allowed and the sale is set aside, the position of the decree -holder and the judgment -debtor would be restored to the position as it stood before such sale took place, in other words, the debt which was extinguished by the sale would be revived as soon as the sale is set aside. Following these decisions of the Calcutta High Court, a learned Single Judge of the Lahore High Court in Mohammad Din and Anr. v. Nand Lal and Ors., A.I.R. 1945 Lah. 97, which was a case with reference to Section 25 of the Punjab Relief of indebtedness Act, 1934, was of the view that:
After the sale, but before confirmation, execution proceedings are no doubt in existence but they are not pending 'in respect of any debt '. The 'debt ' has been wiped off by the auctioneer -sale, it has disappeared, at any rate temporarily, from the date of the sale.
I may, in this connection, refer to Rule 72 of Order 21,Code of Civil Procedure which so far as is relevant runs thus:
72. (1) No. holder of a decree in execution of which property is said shall, with and the express permission of the Court, bid for or purchase the property.
(2) Where a decree -holder purchases with such permission the purchase -money and the amount due an the decree may, subject to the provisions of Section 73, be set off against one another and the Court executing the decree shall enter up satisfaction of the decree in whale or in part accordingly.
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The case before me is one where the decree -holder had been permitted by the Court to bid at the sale and to set off the purchase money against his decretal dues. Clauses (2) of Rule 72 is clear that in such a case, the Court executing the decree shall enter up satisfaction of the decree in whale or in part as the case may be. This act of entering up satisfaction of the decree is not postponed till the confirmation of the sale. When as contemplated by Clause (2) of Rule 72, the decree is wholly satisfied, no decree remains far being paid in instalments under Section 13 of the Act. When the decree is satisfied in part under Clause (2) of Rule 72, no relief can be granted under Section 13 of the Act in respect of the portion of the decree that is already satisfied. The relief in such cases shall be can firmed only to the balance of decretal dues.
Having regard, therefore, to the clear language of Clause (2) of Rule 72 it appears to me if I may say so with respect, that the view taken by the Calcutta and the Lahore High Courts in the cases referred to above is the correct view. The Courts below were. Therefore, right in confining the relief granted by them under Section 13 of the Act to the balance of the decretal dues outstanding against the judgment -debtors.
(3.) IN the result the revision petition is dismissed. But in the circumstances, without casts.;