IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CMPMO NO. : 169/2010 Reserved on : 7.7.2010 Decided on:23.7. 2010. Jai Lal. ...Petitioner. Versus The Divisional Manager, Forest Working Division. ... Respondent. Coram The Hon’ble Mr. Justice Rajiv Sharma, Judge. Whether approved for reporting?1 Yes. For the Petitioner : Mr. G.D. Verma, Sr. Advocate with Mr. B.C. Verma, Advocate. For the Respondent : Mr. V.B. Verma, Advocate. Justice Rajiv Sharma, Judge Petitioner has challenged order dated 6.4.2010 passed by the learned Presiding Officer, Fast Track Court, Mandi in execution petition No. 6/2005 whereby objections preferred by him under section 47 of the Code of Civil Procedure have been dismissed. Material facts necessary for the adjudication of this petition are that the learned District Judge, Mandi has passed a decree on 20.12.2003 for recovery of Rs. 3,03,765 in favour of the respondent/decree-holder (hereinafter referred to as ‘the decree-holder’ for convenience sake) against the petitioner/judgment-debtor (hereinafter referred to as ‘the judgment-debtor for convenience sake). Whether the reporters of the local papers may be allowed to see the Judgment? Yes. 2 The decree-holder filed an application under order 21 rule 9 of the Code of Civil Procedure before the learned District Judge, Mandi. The records were summoned. A bare perusal of the order sheets reveals that the judgment-debtor has been repeatedly seeking adjournments for making payment with effect from 4.4.2005 onwards. When the payment was not made, the learned Presiding Officer, in the presence of learned Advocate appearing on behalf of the judgment-debtor, passed the following order on 22.10.2007: “Payment not made. The P.F. and list of property of the J.D. filed today. Let warrant of attachment qua decretal amount upto date be issued returnable for 26.11.2007.” Thereafter the warrant of attachment was issued and the same was executed as per the report of the Collector. The learned Presiding Officer passed the following order on 27.12.2007: “Warrant of attachment duly executed as per report of the Collector. Now file be put up for giving notice of order 21 rule 66 CPC for 23.2.2008. The D.H. is directed to file the application within 7 days.” In sequel to order dated 27.12.2007, the decree-holder moved an application under order 21 rule 66 of the Code of Civil Procedure and the copy of the same was supplied to the learned Advocate appearing on behalf of the judgment debtor with a further direction that the matter be put up on 26.4.2008. No reply was filed by the judgment- debtor and consequently following order was passed on 13.5.2008: “Reply not filed. In view of the no objection on behalf of JD regarding the auction of the attached property, thus, the attached property be put to sale as under: Proclamation on : 20.6.08 Sale : 10.7.08 Report : 18.7.08” 3 However, the fact of the matter is that the sale could not take place for number of reasons, including lapse on the part of the decree- holder whereby he had not deposited the necessary process fee etc. In the meantime, the judgment-debtor also moved an application under order 21 rule 72 of the Code of Civil Procedure, which was allowed on 6.1.2010 and thereafter, fresh schedule was drawn on 6.1.2010 by the learned Presiding Officer: “Proclamation on : 16.2.2010 Sale be effected on: 3.3.2010 Report on : 15.3.2010” The judgment-debtor preferred objection under section 47 of the Code of Civil Procedure on 3.3.2010. The copy of the same was supplied to the learned Advocate appearing on behalf of the decree- holder as per order dated 15.3.2010. Petition under section 47 of the Code of Civil Procedure was dismissed by the learned Presiding Officer on 6.4.2010. Mr. G.D. Verma, learned Sr. Advocate has strenuously argued that the Presiding Officer has not complied with order 21 rule 54 as well as order 21 rule 66 of the Code of Civil Procedure and according to him order dated 6.4.2010 is a nullity. Mr. V.B. Verma has supported the order dated 6.4.2010. I have heard the learned counsel for the parties and have perused the record carefully. What emerges from the facts enumerated hereinabove is that the judgment-debtor had been seeking frequent adjournments to make payment as per the decree, however, when no steps were taken by the judgment-debtor to deposit the money, as undertaken before the learned Presiding Officer, necessary steps were taken for attachment of the property on the basis of order dated 22.10.2007. Warrant of 4 attachment was duly executed by the Collector. The decree holder preferred an application under order 21 rule 66 of the Code of Civil Procedure, copy whereof was supplied to the learned counsel appearing on behalf of the judgment debtor. The judgment-debtor has not chosen to file any reply as is evident from order dated 13.5.2008 and thereafter the learned Presiding Officer has ordered the auction of the attached property as per the schedule given by him. The application preferred by the judgment-debtor under order 21 rule 72 of the Code of Civil Procedure already stand allowed. Order of attachment was passed by the learned Presiding Officer on 22.10.2009 in the presence of the learned counsel appearing on behalf of the judgment-debtor. No objections, whatsoever, were raised by the learned counsel for the judgment-debtor at the time when the warrant of attachment qua the decretal amount was issued returnable for 26.11.2007. The judgment-debtor knew throughout the execution proceedings pending before the learned Presiding Officer. Warrant of attachment has been duly executed as per the report of the Collector. Necessary entries were also incorporated in the revenue record. Mr. G.D. Verma has argued that his client was not put to notice before the steps as required under order 21 rule 54 of the Code of Civil Procedure were taken. There is no merit in this contention. Learned counsel appearing on behalf of the judgment-debtor was present at the time when the warrant of attachment was issued on 22.10.2007. He had sufficient notice of the proceedings. He has waived the right, which was available to him under order 21 rule 54 of the Code of Civil Procedure. Their Lordships of the Hon’ble Supreme Court in Desh Bandhu Gupta versus N.L. Anand and Rajinder Singh, (1994) 1 SCC 131 have held that the purpose of attachment under rule 54 is to make the 5 judgment-debtor aware that attachment has been effected and that he should not make any transfer or encumber the property thereafter. It is in the interest of the decree-holder to have the notice of attachment served personally on the judgment-debtor. However, their Lordships have further held that nevertheless the sale is not void, though the omission to serve the copy of the order of attachment is an irregularity. Now, the Court will advert to second argument advanced by Mr. G.D. Verma that there is non-compliance of order 21 rule 66 of the Code of Civil Procedure. It is true that provisions of order 21 rule 66 of the Code of Civil Procedure are required to be followed scrupulously by the courts in the execution proceedings. In the instant case, the judgment-debtor was supplied with the copy of application under order 21 rule 66 CPC on 17.3.2008. The Judgment-debtor has not chosen to file any reply despite the opportunity given and in these circumstances the attached property was ordered to be sold by the Presiding Officer on 13.5.2008. Their Lordships of the Hon’ble Supreme Court in the above cited judgment have held that the service of notice on judgment- debtor under order 21 rule 66 (2) CPC unless waived by appearance or remained ex parte, is a fundamental step in the procedure of the court in execution. Judgment-debtor should be given an opportunity to give his estimate of the property. It enables the purchaser to know its value. Absence of notice to the judgment-debtor disables him to offer his estimate of the value who better knows its value and to publicize on his part, canvassing and bringing the intending bidders at the time of sale. Their Lordships have further held that the service of notice of the judgment-debtor is a fundamental part of the procedure touching upon the jurisdiction of the Execution Court upon to take further steps to sell his immovable property. Their Lordships have further held that notice under order 21 rule 66 (2), unless proviso is applied (if not already 6 issued under order 21 rule 22), service is mandatory. Their Lordships have further held that the omission thereof render the further action and the sale in pursuance thereof void unless the judgment-debtor appears without notice and thereby waives the service of notice. It has further been held that order 21 rule 54, sub-rule (1-A) brought in by 1976 Amendment Act mandates that the court should require the judgment- debtor to attend the court on a specified date to take notice of the date to be fixed for settling the terms of the proclamation of sale. Their Lordships have held as under: “7. Mr Gupta contended that under Order 21 Rule 54 the appellant had not been served with the order of attachment. Either the appellant or the inmates of his house were always available at his residence. It was said to have been affixed at the site and his enquiries revealed that no such affixation at the site was made. It is an admitted position that no personal service on the appellant was effected but nonetheless evidence discloses that it was affixed at the site. The purpose of attachment under Rule 54 is to make the judgment-debtor aware that attachment has been effected and that he should not make any transfer or encumber the property thereafter. It is in the interest of the decree-holder to have the notice of attachment served personally on the judgment-debtor. Nevertheless the sale is not void, though the omission to serve the copy of the order of attachment is an irregularity. Since no encumbrance thereafter was created on the attached property, non-service of the copy of the order of attachment on the judgment-debtor does not render the sale invalid. 9. However, there is considerable force in the contention of the appellant that the procedure prescribed under Order 21 Rule 66 was flagrantly violated by the Executing court. We have already noted the order of the court to conduct the sale. For judging its legality and validity, it would be desirable to have a bird's eye view of the procedure for sale of immovable property in execution. On an application for execution filed under Order 21 Rule 5 the court shall ascertain the compliance of the prerequisites contemplated under Rule 17 and on finding the application in order, it should be admitted and so to make an order, thereon to issue notice 7 under Rule 22, subject to the conditions specified therein. If a notice was served on the judgment-debtor as enjoined under Order 5 but he did not appear or had not shown cause to the satisfaction of the court, under Rule 23 the court "shall order the decree to be executed". If an objection is raised to the execution of the decree, by operation of sub-rule (2 thereof, "the court shall consider such objections and make such order as it thinks fit". Thereafter in the case of a decree for execution against immovable property an attachment under Rule 54 should be made by an order prohibiting the judgment-debtor from transferring or creating encumbrances on the property. Under Rule 64 the court may order sale of the said property. Under Rule 66(2 proclamation of sale by public auction shall be drawn up in the language of the court and it should be done after notice to the decree-holder and the judgment-debtor and should state "the time and place of sale" and "specify as fairly and accurately as possible" the details specified in clauses (a) to (d) of sub-rule (2 thereof. The Civil Rules of Practice in Part L in the Ch. 12 framed by the High court of Delhi 'Sale of Property and Delivery to the Purchaser' Rule 2 provides that whenever a court makes an order for the sale of any attached property under Order 21, Rule 64, it shall fix a convenient date not being distant more than 15 days, for ascertaining the particulars specified in Order 21 Rule 66(2 and settling the proclamation of sale. Notice of the date so fixed shall be given to the parties or their pleaders. In Rule 4 captioned 'Settlement of Proclamation of Sale, Estimate of Value' it is stated that on the day so fixed, the court shall, after perusing the documents, if any, and the report referred to in the preceding paragraph, after examining the decree-holder and judgment-debtor, if present, and after making such further enquiry as it may consider necessary, settle the proclamation of sale specifying as clearly and accurately as possible the matters required by Order 21 Rule 66(2 of the Code. The specifications have been enumerated in the rule itself. The proclamation for sale is an important part of the proceedings and the details should be ascertained and noted with care. This will remove the basis for many a belated objections to the sale at a later date. It is not necessary to give at proclamation of sale the estimate of the value of the property. The proclamation when settled shall be signed by the Judge and got published in the manner prescribed by Rule 67. The court should authorise its officers 8 to conduct the sale. Under Rule 68 the sale should be conducted at "the place and time" specified or the time may be modified with the consent in writing of the judgment-debtor. The proclamation should include the estimate, if any, given by either judgment-debtor or decree-holder or both the parties. Service of notice on judgment-debtor under Order 21 Rule 66(2, unless waived by appearance or remained ex parte, is a fundamental step in the procedure of the court in execution. Judgment-debtor should have an opportunity to give his estimate of the property. The estimate of the value of the property is a material fact to enable the purchaser to know its value. It must be verified as accurately and fairly as possible so that the intending bidders are not misled or to prevent them from offering inadequate price or to enable them to make a decision in offering adequate price. In Gajadhar Prasad v. Babu Bhakta Ratari this court, after noticing the conflict of judicial opinion among the High courts, held that a review of the authorities as well as the amendments to Rule 66(2(c) make it abundantly clear that the court, when staling the estimated value of the property to be sold, must not accept merely the ipse dixit of one side. It is certainly not necessary for it to state its own estimate. If this was required, it may, to be fair, necessitate insertion of something like a summary of a judicially considered order, giving its grounds, in the sale proclamation, which may confuse bidders. It may also be quite misleading if the court's estimate is erroneous. Moreover, Rule 66(2(e) requires the court to state only nature of the property so that the purchaser should be left to judge the value for himself. But, the essential facts which have a bearing on the very material question of value of the property and which could assist the purchaser in forming his own opinion must be stated, i.e. the value of the property, that is, after all, the whole object of Order 21, Rule 66(2(e), Civil Procedure Code. The court has only to decide what are all these material particulars in each case. We think that this is an obligation imposed by Rule 66(2(c). In discharging it, the court should normally state the valuation given by both the decree-holder as well as the judgment-debtor where they both have valued the property, and it does not appear fantastic. It may usefully state other material facts, such as the area of land, nature of rights in it, municipal assessment, actual rents realised, which could reasonably and usefully be stated succinctly in a sale 9 proclamation has to be determined on the facts of each particular case. Inflexible rules are not desirable on such a question. It could also be angulated from another perspective. Sub-rule (1 of Rule 66 enjoins the court that the details enumerated in sub-rule (2 shall be specified as fairly and accurately as possible. The duty to comply with it arises only after service of the notice on the judgment-debtor unless he voluntarily appears and is given opportunity in the settlement of the value of the property. The absence of notice causes irremedial injury to the judgment-debtor. Equally publication of the proclamation of sale under Rule 67 and specifying the date and place of sale of the property under Rule 66(2 are intended that the prospective bidders would know the value so as to make up their mind to offer the price and to attend at sale of the property and to secure competitive bidders and fair price to the property sold. Absence of notice to the judgment-debtor disables him to offer his estimate of the value who better knows its value and to publicise on his part, canvassing and bringing the intending bidders at the time of sale. Absence of notice prevents him to do the above and also disables him to know fraud committed in the publication and conduct of sale or other material irregularities in the conduct of sale. It would be broached from yet another angle. The compulsory sale of immovable property under Order 21 divests right, title and interest of the judgment-debtor and confers those rights, in favour of the purchaser. It thereby deals with the rights and disabilities either of the judgment-debtor or the decree-holder. A sale made, therefore, without notice to the judgment-debtor is a nullity since it divests the judgment-debtor of his right, title and interest in his property without an opportunity. The jurisdiction to sell the property would arise in a court only where the owner is given notice of the execution for attachment and sale of his property. It is very salutory that a person's property cannot be sold without his being told that it is being so sold and given an opportunity to offer his estimate as he is the person who intimately knew the value of his property and prevailing in the locality, exaggeration may at time be possible. In Rajagopala Ayyar v. Ramachandra Ayyar the full bench held that a sale without notice under Order 21 Rule 22 is a nullity and is void and that it has not got to be set aside. If an application to set aside such a void sale is made it would fall under Section 47. 10 10. Above discussion indicates a discernible rule that service of notice on the judgment-debtor is a fundamental part of the procedure touching upon the jurisdiction of the Execution court to take further steps to sell his immovable property. Therefore, notice under Order 21 Rule 66(2, unless proviso is applied (if not already issued under Order 21 Rule 22, and service is mandatory. It is made manifest by Order 21 Rule54(l-A) brought on statute by 1976 Amendment Act with peremptory language that before settling the terms of the proclamation the judgment-debtor shall be served with a notice before settling the terms of the proclamation of sale. The omission thereof renders the further action and the sale in pursuance thereof void unless the judgment-debtor appears without notice and thereby waives the service of notice. 12. The contentions of S/Shri Madhava Reddy and Gujral that the appellant had not given his valuation and that, therefore, it is not open to him to raise the objections after the sale is unacceptable. Since the court had not given any notice to the appellant which is mandatory, the need to submit his valuation did not arise. Order 21 Rule 54, sub-rule (1-A) brought in by 1976 Amendment Act mandates that the court should require the judgment-debtor to attend the court on a specified date to take notice of the date to be fixed for settling the terms of the proclamation of sale. Form 24 of Appendix 'E' second para and the court Rules also envisage the mandate. It is a reminder to the court that it has a statutory duty to issue notice to the judgment-debtor before settlement of the terms of proclamation of sale. Then only the proviso to Rule 66(2 comes into play dispensing with multiplicity of notices and not dispensation of mandatory compliance of notice to the judgment-debtor. Had it been a case where notice was served and the appellant lay by, without objecting to the valuation given by the decree-holder, certainly that would be put against the appellant to impugn the irregularities after the sale or the under-valuation settled by the court in the proclamation of sale. The further contentions of both the counsel that merely because there is no order under Order 21 Rule 66(2, it cannot be construed that the Execution court had not applied its mind in settling the terms of the proclamation of sale, is one of desperation. Except giving a schedule of dates for conducting the sale the Execution court totally abdicated its duty to scrupulously comply with the mandatory procedure and did 11 not apply its mind to the mandatory duty cast on it by Order 21 Rule 66 to settle the terms of proclamation of sale, and proper publication under Rule 67. After 20/04/1979, the court had merely ensured its publication on the court notice board and on the site at the respective dates and no further. This court in Shalimar Cinema v. Bhasin Film Corpn. held that the court has a duty to see that the requirements of Order 21 Rule 66 are properly complied with. It is incumbent on the court to be scrupulous in the extreme. No action of the court or its officer should be such as to give rise to the criticism that it was done in a casual way. Therefore, a proclamation of sale drawn casually without compliance of the mandatory requirement and a sale held in furtherance thereof is not a sale in the eye of law. We are of the considered view that the procedure adopted by the court in non-compliance of Order 21 Rules 66 and 67 is in flagrant breach of the mandatory provision. It is a nullity ab initio.” In the instant case, the learned Advocate had appeared on behalf of the judgment-debtor. However, no reply, as noticed above, was filed to the application preferred under order 21 rule 66 CPC by the judgment-debtor. Service of notice was waived by his Advocate. In these circumstances, the judgment-debtor knew about the proceedings but did not object to the procedure adopted by the learned Presiding Officer whereby he has put the attached property to sale. The procedure prescribed under order 21 rule 54, 66 and 67 is to be followed scrupulously as held by their Lordships in Desh Bandhu Gupta’s case (supra) unless waived. Mr. G.D. Verma has referred Mahakal Automobiles and another versus Kishan Swaroop Sharma, (2008) 13 SCC 113. Their Lordships of the Hon’ble Supreme Court have held that each stage of the sale is governed by the provisions of order 21 rule 66 of the Code of Civil Procedure. Their Lordships have further held that at each stage of the execution of the decree, when a property is sold, it is mandatory that the notice shall be served upon the person whose property is being 12 sold in execution of the decree and any property which is sold without notice to the person whose property is being sold is a nullity and all actions pursuant thereto are liable to be struck down/quashed. However, in the case in hand, judgment-debtor’s Advocate had been attending all the proceedings when the necessary orders under order 21 rule 54 and 66 of the Code of Civil Procedure were passed by the learned