Decided on August 19,1971



Obul Reddy. J. - (1.)This Letters Patent appeal is before us, as our learned brother, Sambasiva Rao, J., was of the view that as important questions of law arise it is a fit and proper case to grant leave to appeal. The two main questions that arise for our consideration are : (i) whether the appellants-judgment-debtors are entitled to the restitution of the properties under section 144, Civil Procedure Code sold in execution of the decree and purchased by the decree-holder, who later sold the properties to the present respondent; and (2) whether the sale of the properties by the decree-holder-auction purchaser during the pendency of the application made by the judgment debtors for setting aside the ex parte preliminary and final decrees is hit by section 52 of the Transfer of Property Act.
(2.)To determine the two questions involved, it is necessary to state the relevant facts leading up to the filing of this appeal. One Subba Reddy filed a suit, O.S. No. 232 of 1951 in the Court of the District Munsif, Proddatur, against the appellants on the foot of a mortgage deed for recovery of the sum due under the mortgage. The hypotheca consisted of Acres 25.70 cents of land at Pottipad in Cuddapah district. There was an ex parte decree on 13th July, 1951 against the appellant for Rs. 912-12-0 and four months time was granted for redemption. As there was no redemption within that period, a final decree was made on 10oth January, 1952 and this also happened to be an ex parte decree. On 3rd November, 1952, the hypotheca was brought to sale and the decree-holder purchased it at the Court-auction for Rs. 1,550. On 9th December, 1952, two applications, LA. Nos. 935 and 936 of 1952 were filed by the appellants for setting aside the ex parte preliminary and final decrees. They also filed an application under Order 21, rule 90 for setting aside the sale; but that application was dismissed as neither security was furnished nor was any deposit made of the amount realised by the sale. The sale was, therefore, confirmed on 20th February, 1953 and this Was during the pendency of 4he two applications, I.A. Nos. 935 and 936 of 1952. The decree-holder-auction-purchaser then sold the property to the respondent herein on 12th June, 1953. The applications for setting aside the two ex parte decrees were allowed on and September, 1954 subject to the condition that the judgment-debtors should deposit a sum of Rs. 1,235-7-0 within the specified period. The actual amount deposited by the judgment debtors was short of 7 annas. The District Munsif dismissed the two applications as the full amount, within the prescribed date, was not deposited by the judgment-debtors. The judgmentdebtors then filed civil revision petitions in this Court and they were dismissed on 10th July, 1957 on the ground that appeals should have been preferred against the orders of the District Munsif. There after Civil Miscellaneous AppealsNos. 10 and 11 of 1958 Were filed in the District Court with petitions to excuse delay. The deiay was excused but the respondent preferred revisions to this Court which were eventually dismissed. Thereafter, the appellate Judge dismissed the appeals on the ground that they were barred by limitation. Again the judgment debtors preferred revisions to this Court and they were allowed. The District Court, thereafter held that there was substantial compliance with the order of the District Munsif in depositing a sum of Rs. 1,235 as against a sum of Rs. 1,235 7-0 directed to be deposited and, in that view, set aside the ex parte preliminary and final decrees made by the District Munsif. Civil Revision Petition Nos. 1068 of 1962 and 916 of 1964 were filed by the decree-holder and this Court upheld the view taken by the appellate Judge that there was substantial compliance with the condition imposed by the District Munsif and that the default committed by the judgment debtors in not depositing a paltry amount of 7 annas need not have been the subject matter prolonged litigation. This Court, in these two revision petitions, permitted the decree-holder to withdraw the amount towards satisfaction of his decree and directed the District Munsif to dispose of the suit after allowing some time to the judgment-debtors to deposit the amount, if any, found due under the mortgage after giving credit to the amount already deposited. The District Munsif passed a preliminary decree on 1st October, 1965. In the meanwhile, after the District Judge allowed C.M.A.Nos. 10 and 11 of 1958 and set aside the ex parte decrees, the appellants filed an application, E.A. No. 549 of 1962 on 4th December, 1962 for restitution of the properties in the Court of the first instance. That application was allowed and the respondent was directed to deliver possession of all the lands purchased by him from the decree holder and pay the mesne profits as specified in the order. But that application as against the decree-holder was dismissed with costs. Then, an appeal (A.S.No. 15 of 1964) was preferred by the present respondent and the learned District Judge allowed the appeal and set aside the order of the District Munsif directing restitution of the property. Against that, C.M.S.A.No. 80 of 1968 was unsuccessfully preferred by the appellants and hence this appeal.
(3.)Mr. Bhujanga Rao appearing for the appellants strongly contended that, when once an exparte decree is set aside, the sale held in execution of the ex parte decree, when the property is purchased by the decree-holder himself, becomes void and the fact that the decree-holder sold the property to a third party makes no difference so far as the Validity of the sale is concerned. Elaborating his argument, the learned Counsel sought to draw a distinction between a stranger-purchaser of the property and a purchaser of the property from the decree-holder-auction-purchaser. In this connection, the learned Counsel laid emphasis on the Judgment of Chief Justice Satyanarayana Raju in C.R.P.No. 2068 of 1962 and 916 of 1964, where it was observed that "the decretal amount having been deposited, the petitioner can withdraw that amount towards the satisfaction of his decree " and that " a formal order to that effect should be really sufficient to dispose of the suit", to show that the appellants are entitled to restitution by reason of this judgment.

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