M/S Bee Gee Corporation Pvt. Ltd vs Punjab Financial Corporation

NON-REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 9651 OF 2018 (@ SPECIAL LEAVE PETITION (CIVIL) NO. 30323 OF 2014)

M/S BEE GEE CORPORATION PVT. LTD ...APPELLANT(S) VERSUS

PUNJAB FINANCIAL CORPORATION & ANR. ...RESPONDENT(S)

J U D G M E N T

R. BANUMATHI,J.

1. Leave granted.

2. This appeal has been preferred against the order dated

24.02.2014 in EFA No. 536 of 1988 passed by the High court of

Punjab and Haryana whereby the High Court confirmed the order of

the Executing Court affirming the auction sale in favour of the

first respondent-corporation.

3. The appellant-herein obtained loan from the first

respondent-Corporation in 1966 and has not adhered to the terms

and conditions of the loan in repayment and was declared as a

defaulter. For the subsisting amount of loan, decree was passed.

In execution of the decree, Signature Not Verified the appellant’s property was sold on Digitally signed by MADHU BALA Date: 2018.09.24 16:44:24 IST Reason: 16.12.1983 by the Court following the order of Executing Court in

the Execution Petition.

4. We have heard Mr. A.K. Chopra, learned senior counsel 2

appearing for the appellant as well as Mr. T.S. Doabia, learned

senior counsel appearing for respondent no. 1.

5. The appellant-herein challenges the Court auction sale held

on 16.12.1983 which has been upheld by both the Executing Court as

well as by the High Court. The contention of the appellant is that

the Court auction sale is vitiated primarily on :-(i) on account

of non-compliance of mandatory provisions of Order 21 Rule 85 CPC

and (ii) that the same is further vitiated on account of non-

publication of sale notification well in advance prior to the date

of sale (16.12.1983).

6. Insofar as the first contention of non-compliance of Order

21 Rule 85 CPC is concerned, even at the outset, it is to be

pointed out that the first respondent-corporation is not only an

auction purchaser but also a decree holder. As per Order 21 Rule

72 CPC, the decree holder cannot bid to buy the property put to

auction except by express permission of the Court. As per order

21 Rule 72(2) CPC, the amount of decree may be taken as payment to

set off against one another. In this case, our attention has been

drawn to the order of the Executing Court dated 03.12.1983 by

which the Executing Court has granted permission to the first

respondent-corporation under Order 21 Rule 72 CPC to participate

in the bid. Thus the first respondent-financial corporation bid in

the auction by virtue of the permission granted by the Court. In

view of the provision to set off under Order 21 Rule 72(2) there

was no requirement of depositing the sale proceeds of Rs. 12 lakhs

or any part thereof in the Court.

3

7. Learned senior counsel appearing for the appellant

contended that Order 21 Rule 85 CPC has not been properly complied

with and the High Court failed to consider the objections so

raised by the appellant. It was further submitted that adjustments

not having been made and repayment of excess amount not done would

nullify the entire sale and this has not been considered by the

High Court. In support of his submission, learned senior counsel

has placed reliance on judgments of this Court in the case of

Manilal Mohanlal Shah & Ors. vs. Sardar Sayed Ahmed Sayed Mahmad &

Anr. reported in AIR 1954 SC 349; Balram Son of Bhasa Ram Vs.

Ilam Singh & Ors. reported in 1996 (5) SCC 705 and Trinath

Harichandan & Ors. Vs. Chairman Paradeep Port Trust and Ors.

reported in 1998 (3) SCC 113 and Shilpa Shares and Securities and

Ors. Vs. The National Cooperative Bank Ltd. and Ors. reported in

2007 (12) SCC 165.

8. Order 21 Rule 85 mandates the deposit of the bid amount.

As per proviso to Order 21 Rule 85 CPC an amount of bid, in which

the decree holder is a purchaser, can be set-off. Since first

respondent-corporation is not only the auction purchaser but also

a decree holder as well, there is no question of deposit of the

auction amount. Since there was no prospective buyer to offer bid

on the occasion of the previous auction sale, the first

respondent-corporation filed application on 03.12.1983 seeking

permission under Order 21 Rule 72 CPC and also exemption from

depositing 25% of the bid amount at the time of auction and

remaining 75% later under Order 21 Rules 84 and 85 CPC 4

respectively. This application was allowed by the Executing Court

on the same date i.e. 03.12.1983 and the same was not challenged.

Both the Executing Court as well as the High Court have

concurrently held that mandatory provisions of Order 21 Rule 85

CPC has been duly complied with. As pointed out earlier, the

first respondent-corporation is not only an auction purchaser but

also a decree holder entitled to the provisions of set off under

Order 21 Rule 85 proviso, as noted above.

9. Insofar as the contention of the appellant that there was

no prior publication done on 15.12.1983, learned senior counsel

appearing for the first respondent-corporation has drawn our

attention to the findings of the courts below that there was

notification of warrant of sale dated 19.11.1983. Learned senior

counsel appearing for the first respondent has submitted that from

the evidence of K.R. Bhalla (DW-1) it is clearly brought on record

that wide publication was given regarding the sale by publication

in ‘Daily Tribune’ as well as other papers. That apart warrant of

sale dated 19.11.1983 was affixed at the spot. Thus there was

wide publication about the sale well prior to the date of auction.

Though publication was done in the newspaper on 15.12.1983, since

warrant of sale was affixed well in advance, we do not find any

violation either in the proclamation of sale or in the

advertisement of sale. Both the Courts below concurrently recorded

that the provisions of Order 21 Rule 85 CPC and other mandatory

provisions were duly complied with and we are not inclined to

interfere with the concurrent findings of the Courts below. 5

10. The appeal is, accordingly, dismissed.

….......................J. [R. BANUMATHI]

…......................J. [INDIRA BANERJEE] NEW DELHI 18TH SEPTEMBER, 2018