1. A plaintiff – Decree holder who purchased the immovable property in execution sale preferred the second appeal under Section 100 C.P.C. Defendant-Judgment Debtor is the respondent in the second appeal. This appeal challenges the view taken by both the Courts below. It seeks to set-aside the Order dated 08.08.2011 of the learned Principal Junior Civil Judge, Punganur in E.A.No.179 of 2006 in OEP No.7 of 2004 in O.S.257 of 1999, which was in turn confirmed by the learned Senior Civil Judge, Punganur in A.S.No.04 of 2011 by Judgment dated 30.01.2013.
2. All the facts are not in dispute. Questions of law alone have arisen in the second appeal. The need for consideration of those principles of law is in the context of the following facts:-
The appellant as plaintiff in O.S.257 of 1999 obtained the decree against the respondent herein. Certain immovable properties of the respondent were attached. Execution proceedings were initiated for sale of some of the immovable properties towards realization of the decree debt. The sale of the properties was held on 16.03.2006. Having earlier obtained permission to bid, the plaintiff/D.Hr/appellant participated in the Court auction of sale and became the highest bidder. Since he was the purchaser of the property, he must remit the purchase amount. On the day the sale was held which was on 16.03.2006, the appellant was to deposit 25% of the purchase money. However, he being the Decree holder he sought for set off and the same was allowed by the Executing Court. ThusOrder XXI → Rule 84 → "> Order XXI Rule 84 C.P.C which provides for deposit of 25% purchase money stood complied with.
3. The D.Hr/auction purchaser was to deposit the balance purchase money into Court before the Court closes on 15th day from the sale of the property. Here also he was entitled for set off, since he is the decree holder. The balance purchase money was found to be Rs.38,697/-. The D.Hr/auction purchaser deposited that amount within 15 days and it seems it was on 23.03.2006 he made that deposit. However, it is here the further facts and events took place and gave rise to the controversy.
4. The auction purchaser having deposited full purchase money was to secure a sale certificate/certificate of purchase in terms ofOrder XXI → Rule 94 → "> Order XXI Rule 94 C.P.C. In this regard, he had to submit the general stamp for certificate or the amount required for such stamp shall be deposited into Court. D.Hr/auction purchaser was conscious of this principle. The time within which the deposit of money for stamp or deposit of stamp has to be done is provided underOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C. While considering this provision one has to notice that the provision stood substituted in the State of Andhra Pradesh, so the rule as is available in the State of Andhra Pradesh is extracted here:-
Time for payment in full of purchase money and of stamp certificate of sale:-
“The full amount of purchase money payable and the general stamp for the certificate under Rule 94 or the amount required for such stamp shall be deposited into Court by the purchaser before the Court closes on the 15th day from the sale of the property.”
“Provided that, in calculating the amount of purchase money, to be so deposited the purchaser shall have advantage of any set-off to which he may be entitled under Rule 72.”
5. Instead of depositing the amount required for general stamp within 15 days from the date of sale, the D.Hr/auction purchaser moved an application before the Executing Court on 29.03.2006 praying to grant him an additional time for deposit of amount for general stamp. The Executing Court granted the permission and granted time till 13.04.2006. It was on 12.04.2006 the D.Hr/auction purchaser deposited Rs.5,820/- along with lodgment schedule for the purpose of sale certificate.
6. The above facts would indicate that the entire purchase money was paid within 15 days from the time of Court auction sale. However, the amount required for general stamp was remitted beyond the period prescribed.
7. It was then the turn of J.Dr. J.Dr filed E.A.No.179 of 2006 underOrder XXI → Rule 90 → "> Order XXI Rule 90 C.P.C. and sought for setting aside the sale. Principle contention taken in that application was violation ofOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C. The other contentions include sale for lesser price and the contention that the J.Dr has only 1/5th share in the property sold and the bidders were kith and kin of the D.Hr who formed as syndicate and got the property knocked away for cheaper rate. That there was no paper publication and proclamation of sale. D.Hr/auction purchaser put in his counter and after due enquiry all the contentions raised by the J.Dr to set-aside the sale were negatived by the Executing Court except one contention which was based onOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C. Before the Executing Court both sides cited precedent.
Executing Court elaborately extracted the ratio of precedent and and held that the court itself had no power to grant time for deposit of amount for sale certificate and that the amount for sale certificate being deposited much after the prescribed period of 15 days provided under the statute, the sale could not be sustained and accordingly it allowed the execution application and set-aside the sale.
8. Aggrieved of it, D.Hr/auction purchaser preferred A.S.No.04 of 2011. Learned Senior Civil Judge, extensively considered the submissions on both sides and considered the ratio in various precedents and agreed with the view taken by the Executing Court and confirmed the Order of the lower Court and dismissed the appeal.
9. Aggrieved of it, D.Hr/auction purchaser had come up with second appeal.
10. On 13.10.2015, this Court admitted this appeal on the following substantial questions of law:-
"1. Whether the deposit of stamp duty for certificate of sale within the time extended by the Court below by the auction purchaser/Decree Holder amounts to sufficient compliance ofOrder XXI → Rule 85 → "> Order XXI Rule 85 of the Code of Civil Procedure as is applicable to the State of Andhra Pradesh
2. Whether the Orders and decrees of the Court below are vitiated for holding that non-deposit of stamp duty for certificate of sale within the stipulated time is a substantial irregularity and that the same automatically cancels the auction sale"
11. In the debate during the course of arguments learned counsel for appellant submits that the appellant is the decree holder and purchased the property during the execution sale and deposited the entire money within the time and his payment of amount for general stamp subsequent to expiry of 15 days was an act that was permitted by the Executing Court by its specific order where under it granted time till 13.04.2006 and the deposit was made within the extended time. Having been allowed by the Court, D.Hr acted according to the orders of the Court. That order of the Court should protect the D.Hr and the sale and the lower Court order should be set-aside. Learned counsel argued that the purchase money is different from amount for general stamp and the amount for general stamp comes into existence only on deposit of purchase money. Since purchase money was deposited within the time, sale shall be upheld as was done by this Court in G.Venkata Reddy Vs B.Venkata Reddy 2010 (6) ALT 135 (A.P.). Learned counsel further argued that the sale was set-aside underOrder XXI → Rule 90 → "> Order XXI Rule 90 C.P.C. by the Executing Court and infact there was neither contentions nor findings to the effect that any fraud was played on the Executing Court and failure to deposit amount for general stamp is not material irregularity vitiating the sale. For the proposition that Court shall not interfere with sale unless it suffers from material irregularity or fraud, learned counsel placed reliance on Ram Krishun & Ors., Vs State of U.P. & Ors 2012 AIAR (Civil) 614 (SC). Learned counsel for the appellant further submits that when the Court is to collect the revenue extension of time in appropriate cases is always within the realm of the Court and cited Mahanth Ram Das Vs Ganga Das AIR 1961 Supreme Court 882(1).
12. As against the above contentions, the learned counsel for respondent/J.Dr submits that the purport ofOrder XXI → Rule 84 → "> Order XXI Rule 84 C.P.C. as is available in the State of Andhra Pradesh is mandatory in nature. Non compliance with deposits within the time schedule prescribed by that provision vitiates the sale itself and the Court itself has a duty to consider such sale as null and void and take steps for resale of the property and it has no power to grant extension of time and placed reliance on G.Venkata Ramana Naidu Vs K.Venkataramana Reddy and others in C.R.P.6528 of 2018 the order of this Court dated 18.03.2019 and Mudragada Suryanarayanamurthi Vs Southern Agencies AIR 1962 AP 271 (DB).. Learned counsel for J.Dr/Respondent supported the lower Court order and submits that no interference is required in this second appeal.
13. In the back drop of the above submissions, now the substantial questions of law raised in this appeal have to be addressed. The whole legal tangle revolves aroundOrder XXI → Rule 84, 85 and 86 → "> Order XXI Rule 84, 85 and 86 C.P.C. For benefit they are extracted here:-
Rule 84 of C.P.C: Deposit by purchaser and re-sale on default:
"(1) On every sale of immovable property the person declared to be the purchaser shall pay immediately after such declaration a deposit of twenty-five per cent on the amount of his purchase-money to the officer or other person conducting the sale, and in default of such deposit, the property shall forthwith be re-sold.
(2) Where the decree-holder is the purchaser and is entitled to set-off the purchase-money under rule 72, the Court may dispense with the requirements of this rule."
Rule 85 of C.P.C: Time for payment in full of purchase money and of stamp certificate of sale:-
“The full amount of purchase money payable and the general stamp for the certificate under Rule 94 or the amount required for such stamp shall be deposited into Court by the purchaser before the Court closes on the 15th day from the sale of the property.”
“Provided that, in calculating the amount of purchase money, to be so deposited the purchaser shall have advantage of any set-off to which he may be entitled under Rule 72.”
Rule 86 of C.P.C.: Procedure in default of payment:
In default of payment within the period mentioned in the last preceding rule, the deposit may, if the Court thinks fit, after defraying the expenses of the sale, be forfeited to the Government, and the property shall be re-sold, and the defaulting purchaser shall forfeit all claim to the property or to any part of the sum for which it may subsequently be sold.
Whether the time lines stipulated above for making deposits are mandatory or directory was the prime point that was considered by the Hon’ble Supreme Court of India in Manilal Mohanlal Shah and Others Vs Sardar Sayed Ahmed Sayed Mahammad and Others AIR 1954 SC 349 [LQ/SC/1954/67] . Having examined the statute fand having considered the precedent their lordships held that the rules do not contemplate that there can be any sale in favour of an auction purchaser without depositing 25% of the purchase money in the first instance and the balance amount within 15 days. Non-payment of the price on the part of the defaulting purchaser renders the sale proceedings as a complete nullity. The very fact that the Court is bound to resell the property in the event of default (Order XXI → Rule 86 → ">Order XXI Rule 86 C.P.C.) shows that the previous proceedings for sale are completely wiped out as if they do not exist in the eye of law. When there is no sale within the contemplation of these rules, there can be no question of material irregularity in the conduct of the sale. As per this ruling of their lordship, it is clear that stipulated time lines for deposits as provided in these provisions is mandatory and failure to comply with them results in nullity of the sale itself and the Executing Court has to take steps to resell the property afresh.
14. In the case at hand, the whole of the purchase money was deposited but the time lines were violated only with reference to deposit of amount for general stamp which was mandated by the A.P. amendment in the State of Andhra Pradesh. Therefore, the question comes up is as to whether that failure is also a failure covered by the rules cited and the above cited ruling. Answer to it lies in the words employed inOrder XXI → Rule 86 → "> Order XXI Rule 86 C.P.C. It states that the amounts that were mentioned in the last preceding rule should have been deposited. The last preceding rule isOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C. which stood amended in State of Andhra Pradesh is concerned. Since in this State, it is not only the balance of purchase amount but also the amount required for stamp are mandated to be deposited, no distinction can be made between the balance purchase amount and amount required for general stamp. This was the view taken by this Court in Mudragada Suryanarayanamurthi’s case (supra 4) and is reiterated by this Court by learned Justice U.Durga Prasad Rao in C.R.P.6528 of 2018 in Order dated 18.03.2019. Therefore, as per the saidOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C. it is not only for balance purchase amount but also the amount required for stamp that were to be deposited within the time stipulated. In the case at hand, initially, on the application of D.Hr/auction purchaser the learned Executing Court granted extension of time to the D.Hr/auction purchaser to deposit the amount required for general stamp. Thus it was under that judicial order. D.Hr/auction purchaser gained time in addition to the time prescribed inOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C. Now the question is whether that extension of time order passed by the Executing Court grants an immunity from the wrath of consequences provided inOrder XXI → Rule 86 → "> Order XXI Rule 86 C.P.C. Be it noted, that a power to the Court to grant extension of time could be seen in Section 148 C.P.C. and the said provision allows the Court to exercise its jurisdiction only in those cases where the period is fixed by the Court in which event it could extend the period.Order XXI → Rule 84 and 85 → "> Order XXI Rule 84 and 85 C.P.C. themselves provided period for deposit. They are statutory prescriptions. They are not periods fixed by the Court. When they are not the periods fixed by the Court, the power to grant extension of time does not arise since such power is not vested with the Court. Therefore, such extension of time could not be granted is the law and such view was also taken by this Court in the earlier referred G.Venkata Ramna Naidu’s case (stated supra). One may notice that in Mudragada Suryanarayanamurthi’s case (supra 4), the auction purchaser deposited Rs.36/- out of Rs.45/- towards general stamp and he did that within the statute prescribed time and that deficit was out of a mistake in calculation and having realized the mistake he remitted the balance amount subsequent to the expiry of periods prescribed. Even then Division Bench of this Court stated that there was no power with the Court to extend time and therefore the deposit that was made subsequent to periods could not save the sale.
15. The upshot of the above discussion would show that Courts have no power to permit deposits to be made beyond the time lines prescribed inOrder XXI → Rule 84 and 85 → "> Order XXI Rule 84 and 85 C.P.C. Failure to deposit within the time lines result in complete nullity of the sale proceedings. Since the sale proceedings stood nullified on of expiry of time prescribed inOrder XXI → Rule 85 → "> Order XXI Rule 85 C.P.C., the question of any power being possessed by any Court to grant extended time for deposits does not arise.
16. Learned counsel for the appellant intends to take support from a decision of this Court G.Venkata Reddy’s case (supra 1). That was a case where this Court examinedOrder XXI → Rule 90 → "> Order XXI Rule 90 C.P.C. and stated that failure to deposit stamp amount does not constitute material irregularity in conducting the sale. Holding so it set-aside the order of the Executing Court. In this Judgment this court had considered the issue of repugnancy when the Code of Civil Procedure underwent extensive amendments in the year 1976 and the rules made by the High Courts earlier to that cease to exist. Dealing with a revision this court did not strike down the pre existing rules of the State of Madras which were adopted by the State of Andhra Pradesh.
17. One of the rulings cited by the learned counsel for the appellant is Ram Kushan’s case (supra 2). That case dealt with law concerning sale and the liability of a surety and the recovery of public dues. While deciding those aspects at para 23 their lordships have stated that once the sale has been confirmed it cannot be set aside unless a fundamental procedural error has occurred or sale certificate had been obtained by misrepresentation or fraud. It may be noticed, their lordships had no facts and had no occasion to deal withOrder XXI → Rule 84 and 85 → "> Order XXI Rule 84 and 85 C.P.C. in the cited ruling. Therefore, the important principles that are laid down by their lordships in the above cited ruling do not help the appellant in the case at hand.
18. Learned counsel for the appellant also cited Mahanth Ram’s case (supra 3). That was a case where there was a deficit court fee and there was failure to pay it within the time and in that context their lordships considered Sec.148, 149 and 151 CPC and stated the law as to when and how time that was prescribed by the Court for the payment of deficit Court fee, could be extended. In that case also their lordships had no occasion to deal with theOrder XXI → Rule 84 and 85 → "> Order XXI Rule 84 and 85 C.P.C. Therefore that ruling does not help the appellant.
19. In the case at hand, this court may state that deposit of amount for stamp is only an additional requirement and that cannot be seen as repugnant to the statute of the Parliament. Be that as it may. In the ruling cited the ratio is that the failure to deposit stamp does not constitute material irregularity in terms ofOrder XXI → Rule 90 → "> Order XXI Rule 90 C.P.C. to set-aside the sale. In the case at hand, it was the application underOrder XXI → Rule 90 → "> Order XXI Rule 90 C.P.C. on the part of the J.Dr that resulted in subsequent proceedings till now. In the light of the Judgment of the Hon’ble Supreme Court of India, earlier referred, it is clear that non depositing is not a case of material irregularity in sale. In the eye of law, the sale itself stood nullified. Therefore, the ruling in G.Venkata Reddy’s case (supra 1) is in consonance with the law laid down by the Supreme Court of India. However, the view for permitting time for deposit is against the weight of precedent and especially the law laid down by the Division Bench of this Court in Mudragada Suryanarayanamurthi’s case (supra 4) referred earlier. Therefore, the D.Hr/auction purchaser/ appellant cannot take support of the ruling.
20. The popular and famous principles such as acts of Court should harm none, procedure is handmaid and is not a tool to subvert the substantial justice by themselves do not help the appellant when it comes to mandatory deposits within the mandatory time lines stipulated by the law. One cannot deny from the time the suit commenced in the year 1999, 23 years lapsed but the D.Hr still has to go back to the Executing Court to pursue for his fruits granted in the decree. Law in its part operates equally and forcefully. The prayers of the appellant being against the law and the Orders of the Court below being inconsonance with law, this Court has to answer both the substantial questions of law against the appellant.
21. In the result, this second appeal is dismissed without costs. This Court directs the Executing Court in terms ofOrder XXI → Rule 86 → "> Order XXI Rule 86 C.P.C. that the amounts deposited by the appellant/D.Hr/auction purchaser shall be refunded after defraying the expenses and the Executing Court shall now take up steps to conduct fresh sale in accordance with law in the Execution Petition.
As a sequel, miscellaneous applications pending, if any, shall stand closed.
