FAO No. 255 of 2013

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN** ## **&** **THE HONOURABLE MR.JUSTICE P.G. AJITHKUMAR MONDAY, THE 4[TH] DAY OF APRIL 2022 / 14TH CHAITHRA, 1944 FAO NO. 255 OF 2013** **AGAINST THE ORDER DATED 03.01.2013 IN E.A.NO.622 OF 2012 IN E.P.NO.195 OF 2009 IN O.S NO.495 OF 2006 ON THE FILES OF THE PRINCIPAL SUBORDINATE JUDGE,IRINJALAKUDA** ## **APPELLANT/RESPONDENT/DECREE HOLDER/PLAINTIFF:** ## **RAVEENDRAN** **S/O.AYYANCHITA SUBRAMANIAN,KAVALLUR DESOM,KALLUR VILLAGE,MUKUNDAPURAM TALUK** **BY ADV. SMT.K.M.RASHMI (PARAVOOR)** ## **RESPONDENTS/PETITIONERS/JUDGMENT DEBTORS 1&2/DEFENDANTS 1&2:** **1 VILASINI W/O.PALLATH VADAKKOOTT VELU EZHUTHASSAN,PACHALIPPURAM DESOM,AMBALLUR VILLAGE,MUKUNDAPURAM TALUK 680001 2 JAYESH S/O.PALLATH VADAKKOOT VELU EZHUTHASSAN,PACHALIPPURAM DESOM,AMBALLUR VILLAGE,MUKUNDAPURAM TALUK 680001 BY ADV. SMT.MEENA.A.** **THIS FIRST APPEAL FROM ORDERS HAVING COME UP FOR ADMISSION ON 04.04.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** 2 F.A.O.No.255 of 2013 ## **JUDGMENT** ## Ajithkumar, J. This appeal under Order XLIII Rule 1(j) of the Code of Civil Procedure, 1908 was filed challenging the order of the Principal Sub Court, Irinjalakuda in E.A.No.622 of 2012 in E.P.No.195 of 2009 in O.S.No.495 of 2006. In execution of the decree in O.S.No.495 of 2006, property belonging to the respondents, who are the judgment debtors 1 and 2, was sold in auction and the appellant-decree holder bid the property. The respondents filed E.A.No.622 of 2012 under Order XXI, R.90 of the Code, seeking to set aside the said sale on the ground of irregularity and fraud in publishing and conducting the sale. The Execution Court allowed that application. Aggrieved thereof, the decree holder preferred this appeal. 2. Heard the learned counsel appearing for the appellant and also the learned counsel appearing for the respondents. 3. Decree in O.S.No.495 of 2006 was passed allowing the appellant to realise an amount of Rs.2,03,500/-, together 3 F.A.O.No.255 of 2013 with interest and costs charging upon the plaint schedule property. The respondents did not pay the amount and hence the appellant filed E.P.No.195 of 2009. The property was brought on sale. It is 20 cents of land situated at Amballur Village, abutting the National Highway. On 04.06.2012 the property was put on auction and it was sold for a price of Rs.3,20,000/-. Respondents 1 and 2 filed E.A.No.622 of 2012 alleging that the said sale was vitiated by fraud and irregularity and by such a sale they have sustained substantial injury. Their contentions were multipronged. Sale of 20 cents of land was not required to satisfy the decree. The said property is worth at least Rs.2 lakhs per cent. The 3rd judgment debtor is a mentally ill person, but that fact was not taken into consideration. The decree directed creation of charge on 3/4th of the plaint schedule property only; whereas, the whole 20 cents of property was sold in auction. Accordingly, the sale was said to be vitiated. 4. The appellant filed objection contending as follows: The fact that the 3rd judgment debtor is a mentally ill person 4 ## F.A.O.No.255 of 2013 has no relevance in the matter. It is totally incorrect that the property would be worth Rs.2 lakhs per cent. Sale was conducted in accordance with rules only. There was no irregularity or fraud in publishing or conducting the sale. 5. The 2nd respondents was examined as PW1. No document was produced on either side. 6. The Execution Court took the view that the property was worth much more than the sale price fetched in the sale conducted on 04.06.2012 and sale of whole of the property was not required to satisfy the decree. Sale of whole of the property when the charge created was with respect to 3/4[th] of the same only is wrong. For those reasons, the Execution Court found that the sale was vitiated by fraud and irregularity resulting in substantial injury to the respondents. The sale was accordingly set aside. 7. The learned counsel appearing for the appellant would submit that there was nothing on record to show that the property would have fetched more value than the sale price of Rs.3,20,000/- and the Execution Court without there 5 F.A.O.No.255 of 2013 having any material on record had set aside the sale, which is wrong. Evidence of PW1 was totally insufficient to substantiate the contentions regarding fraud and irregularity and therefore the order of the Execution Court based only on surmises and conjectures. The learned counsel, on the legal aspects, would contend that decree being a charge decree, the Execution Court ought not to have found, there was violation of the provisions of Rule 66 of Order XXI of the Code. The Execution Court placed reliance on the decision in **P.K.Kuruvila v. Corporation Bank [2008 (1) KLT 604]** , to take such a view. The learned counsel appearing for the appellants brought to our notice the decision in **Dhanalakshmi Bank Ltd. Divakaran [2000 (2) KLT 231]** and contended that in a charge decree there cannot be sale of a portion of the property, unless the decree directs so. The Execution Court, in that view of the matter, had gone wrong in setting aside the sale. 8. In **P.K.Kuruvila** (supra) this Court held that the provisions of Rule 66 of Order XXI of the Code are applicable 6 F.A.O.No.255 of 2013 to a mortgage decree also and therefore the Execution Court has the obligation to get itself satisfied as to the necessity to sell the whole of the property. The court is obliged to ascertain whether sale of a portion of the property would be sufficient to satisfy the decree and any failure to obey that mandate flows from Rule 66 of Order XXI of the Code would vitiate the sale. In **Dhanalakshmi Bank Ltd.** (supra) a coequal Bench of this Court held as follows: “7. The decree that was executed was a mortgage decree. Order XXXIV, Rule 4 of the Code (Central) contemplates the passing of a preliminary degree in a suit for sale. The rule provides that the Court shall pass a preliminary decree in terms of Rule 2 of Order XXXIV and further directs that in default of the defendant paying the amount, the plaintiff shall be entitled to apply for a final decree directing that the mortgaged property or a sufficient part thereof be sold and proceeds applied in payment of the amount adjudged to be due by the preliminary decree. Order XXXIV Rule 5 of the Code contemplates the passing of a final decree for sale in terms of the preliminary decree. 7 F.A.O.No.255 of 2013 What is to be noted here is that it is given to the Court passing the preliminary decree for sale, to order either the sale of the whole of the mortgaged property or the sale of sufficient part of the mortgaged property. Once this power of directing sale either of the whole or of the portion is exercised by the Court which passes the decree, it is clear that the executing court has no power to go behind that direction in the decree and to alter either the mode of sale ordered or to consider whether anything less than what is directed by the decree to be sold, need alone be sold.” 9. A charge decree has the semblance of a mortgage decree. But when the charge is created by operation of the provisions of Section 55(6)(b) of the Transfer of Property Act, 1882, the suit is not one under Order XXXIV of the Code. In such a suit, the procedure contemplated in the case of a suit for sale of a mortgaged property in Order XXXIV of the Code are not required to be followed. There will not ordinarily be a preliminary decree and a final decree and for that reason, there is no question of the mortgagor getting an opportunity to point out that sale of a portion of the property would be 8 F.A.O.No.255 of 2013 sufficient to satisfy the decree. In **Dhanalakshmi Bank Ltd.** (supra) what was held is that, once the power of directing sale either of the whole or of the portion is exercised by the Court which passed the decree, the executing court has no power to go behind that direction in the decree and to alter either the mode of sale ordered or to consider whether anything less than what is directed by the decree to be sold, need alone be sold. It implies that only if the court exercised its jurisdiction to decide as to what portion of the property is required to be sold to satisfy the decree, there is a question of estoppel to the judgment debtors to raise a contention that sale of a portion of the property is enough. In that view of the matter, the principle laid down in **Dhanalakshmi Bank Ltd** . (supra) is not in conflict with what has been held in **P.K.Kuruvilla** (supra). 10. In **Fathima Beevi v. Joly John [2022 (2) KLT 396]** this Court following the principle laid down in **Ambati Narasayya v. Subba Rao [AIR 1990 SC 119]** and **Desh Bandhu Guptha v. N.L.Anand & Rajinder Singh [(1994)** 9 F.A.O.No.255 of 2013 ## **1 SCC 131]** held as follows: “In all execution proceedings, the Court has to first decide whether it is necessary to bring the entire attached property to sale or such portion thereof as may seem necessary to satisfy the decree. If the property is large and the decree to be satisfied is small, the Court must bring only such portion of the property, the proceeds of which would be sufficient to satisfy the claim of the decree holder. It is immaterial whether the property is one or several. Even if the property is one, if a separate portion could be sold without violating any provision of law, only such portion of the property should be sold. This, in our opinion, is not just a discretion, but an obligation imposed on the Court.” 11. The Execution Court following the said principle held that sale of the whole 20 cents of the property was termed to be irregular and fraudulent. It is obvious that the court did not apply its mind while proclaiming the entire 20 cents of property for sale for realisation of Rs.2,03,500/- and its interest. Of course, the Execution Court overreached in taking judicial notice for holding that the property would fetch 10 F.A.O.No.255 of 2013 at least Rs.2 lakhs per cent. But, the oral testminoy of PW1 and the fair value of the property fixed by the Registration Department are indicators regarding the probable value of the property to be sold. In any view of the matter, it cannot be said that 20 cents of dry land abutting the National Highway would fetch only Rs.3,20,000/-, and to reach such a finding no much deliberation is required. The sale price is obnoxiously low compared to its market value. Accordingly, we hold that the findings of the Execution Court in that regard is not liable to be interfered with. 12. It is beyond dispute that the charge was created only with respect to 3/4[th] of the property. However, the entire 20 cents of property was sold in execution of the decree. For that reason also the appellant cannot be heard to contend that the decree being a charge decree, the whole of the property should not have been sold. That is another reason to say that the sale is frowned by fraud and irregularity. Needless to say such fraud and irregularity resulted in substantial injury to the respondents. In the said circumstances, the order of the 11 F.A.O.No.255 of 2013 Execution Court setting aside the sale dated 04.06.2012 is not liable to be interfered with. The appeal is liable only to be dismissed. The appeal is therefore dismissed. The Execution Court (Principal Sub Court) Irinjalakuda, will proceed with the proceedings in E.P.No.195 of 2009 in O.S.No.495 of 2006 of 2006 in accordance with law. **Sd/-** ## **ANIL K. NARENDRAN, JUDGE** **Sd/-** **P.G. AJITHKUMAR, JUDGE** dkr