IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.M.JOSEPH & THE HONOURABLE MR. JUSTICE A.M.SHAFFIQUE THURSDAY, THE 8TH DECEMBER 2011 / 17TH AGRAHAYANA 1933 RFA.No. 777 of 2011 F -------------------------------- AGAINST THE ORDER DATED 08.7.2011 IN OS.619/2008 of II ADDL.SUB COURT,ERNAKULAM .................... APPELLANT/RESPONDENT/2ND DEFENDANT: ------------------------------------------------------------------ RAJAN P.C., AGED 52, S/O. LATE P.V. CHACKO, PANDOTH HOUSE, MARKET ROAD, NEAR SANANA MISSION SCHOOL, THEKKUMBHAGAM, TRIPUNITHURA, THEKKUMBHAGAM VILLAGE, KANAYANNUR TALUK, ERNAKULAM DISTRICT. BY ADV. SRI.VARGHESE C.KURIAKOSE SMT.RENJINI RAJENDRAN RESPONDENTS/PETITIONERS/ PLAINTIFF & 1ST DEFENDANT: ---------------------------------------------------------------------------------------- 1. P.C. JOHN, S/O. LATE P.V. CHACKO, AGED 63 YEARS, PANDOTH HOUSE, PALACE NAGAR, THIRUVAMKULAM P.O. 2. P. C. VARGHESE, S/O. LATE P.V. CHACKO, AGED 61, PANDOTH HOUSE, C/O. WESTERN FLOUR MILLS, MARKET ROAD, TRIPUNITHURA. BY ADV. SRI.K.R.MOHANAN THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 08/12/2011 ALONG WITH OP ( C ). NO. 3310 OF 2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.M. JOSEPH & A. M. SHAFFIQUE, JJ. ----------------------------------------- R.F.A.NO.777 OF 2011 F & O.P. ( C ).NO.3310 OF 2011 O ------------------------------------------ Dated this the 8th December, 2011 JUDGMENT K.M. Joseph, J. The above cases being connected and being between the same parties, we dispose of the two cases by the following common Judgment. 2. The appellant is also the petitioner. The parties are brothers. A Suit for partition resulted in a preliminary decree. The parties were declared to be entitled to 1/3rd share in the property. The property which is the subject matter of dispute, is an extent of 11.850 cents with a shop room and residential building situated at Thrippunithura. 3. Originally, the first respondent filed IA.No.4560 of 2009 seeking to pass final decree. The said Application was later on withdrawn. According to the first respondent, it was on the basis RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 2 that there was some compromise. Still later, Ext.P2 Application which was numbered as IA.No.1642/2011 was filed by the respondents. It was purported to be filed under Order 20 Rule 18 and Order 26 Rule 13 and Sections 54 and 151 of the CPC. The prayer was as follows: “For the reasons stated in the accompanying affidavit, this Honourable Court may be pleased to appoint an Advocate Commissioner to conduct an auction among the petitioners and the respondent herein for the sale of the plaint schedule property, or by conducting public auction sale if the sale among the co-owners is not feasible and to allot 1/3rd share each of the sale amount to each of the petitioners respectively and allowing the costs of the proceedings.” Thereupon, the learned Second Additional Sub Judge, Ernakulam proceeded to pass an order dated 08th July, 2011. The said order is produced as Ext.P3 in the Original Petition and it is also the order which is produced in the Appeal which is alleged to be the deemed RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 3 decree within the meaning of the Partition Act. The said order reads as follows: “Petitioners are also ready to participate in the auction sale. Hence this court orders auction sale of the decree schedule property among the co-owners. Sale will be conducted in open court on 22-08-2011 at 2.30 P.M. Also furnish the fair value if any, fixed by the government.” Petitioner/appellant filed IA.No.5167/1. It was a petition purportedly filed under Section 3 of the Partition Act, 1893 (hereinafter referred to as the Act). The IA. reads as follows: “For the reasons stated in the accompanying affidavit, it is most respectfully prayed that this Honourable Court may be pleased to order valuation of the shares of the petitioners in I.A.No.1642/2011 which they are having upon the property to the partition and offer the same to the petitioner herein for purchase in tune with the statutory provisions in the interest of justice.” RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 4 A Counter Affidavit was filed which is produced as Ext.P5 in the Original Petition. The learned Judge proceeded to pass Ext.P6 order dismissing the Application filed by the petitioner/appellant. The prayer sought in the Original Petition is to quash Ext.P6. A further direction is sought to the IInd Additional Sub Court, Ernakulam to effect a proper valuation of the shares of the respondents and to offer the same to the petitioner in view of Section 3 of the Act by allowing Ext.P4 Application. 4. The petitioner in the Original Petition also filed RFA.No.777/2011. Even though the Office had actually noted defect, this Court had directed number of the Appeal on the basis that the impugned order would be a deemed decree under Section 8 of the Act. 5. As already noted, Ext.P3 in the Original Petition is produced as the deemed decree in the Appeal which we have already extracted. RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 5 6. We heard Shri C. Varghese Kuriakose, learned counsel for the appellant/petitioner and also Shri K. R. Mohanan, learned counsel appearing on behalf of the respondents. Learned counsel for the appellant/petitioner would submit that this is a clear case where the court has acted illegally in passing Ext.P6 order which was produced in the Original Petition. He would submit that undoubtedly, the respondents have made a request for sale of the property within the meaning of Section 2 of the Act. The appellant/petitioner had made an oral request and it was also followed up by filing Ext.P4 wherein he sought to exercise the rights vested on him under Section 3 of the Act. He would submit that Section 3 vests on him an indefeasible right at the moment a request is made within the meaning of Section 2 of the Act. He would point out the terms of Ext.P2 which we have extracted, to contend that there was indeed a request under Section 2 of the Act. He would also invite our attention to the contents of the Affidavit RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 6 accompanying Ext.P2 to contend that the respondents actually wanted a public sale. He placed reliance on the following case law: 1) R. Ramamurthi Aiyar (dead) by L.Rs. v. Raja V. Rajeswararao (AIR 1973 SC 643). 2) Hooghly Docking & Engineering Co. Ltd. v. M.M.P. Lines (P) Ltd. and Others (AIR 1983 Calcutta 267). 3) Sathi Lakshmanan v. Mohandas (2008 (4) KLT 401). 4) Jagdish and Others v. Nathi Mal Kejriwal and Others (AIR 1987 SC 68). 7. Per contra, Shri K. R. Mohanan, learned counsel for the respondents would submit that the request made in Ext.P2 was for an auction among the sharers and only if it was not feasible, a public sale was requested for and the composite request in the nature contained in Ext.P2 could by no stretch of imagination be treated as one under Section 2 of the Act. He would emphasise that the sale contemplated on the strength of a request under Section 2 of the Act can only be a public sale. He would submit that the RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 7 provisions of the Partition Act must be construed strictly. In support of his contentions, learned counsel for the respondents placed reliance on the following case law: 1) L. Ram Prasad v. Mt. Mukandi and another (AIR 1929 Allahabad 443). 2) (Darbhamulla) Subbamma v. Valivetti Veerayya and Others (AIR 1932 Madras 15). 3) Sreedharan (Defendant) v. Bhaskaran (Plaintiff) (1963 KLT 692). 4) Sainaba And Others v. Abdurahiman Koya And Others (1982 KLT SN 31 (Case No.48). 5) Anthony Ammal v. Antony (1983 KLT 645). 6) Parangodan v. Lakshmikutty (1993 (2) KLT SN 33 (Case No.33). 7) Sahasranama Iyer v. Ravindranathan (1999 (2) KLT SN 50 (Case No.54). He would contend that actually the order which is alleged to be deemed decree under Section 8 of the Act is not a deemed decree. This would the inevitable result of acceptance of his argument that there is no order for sale under Section 2 of the Act. RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 8 8. The decision in R. Ramamurthi Aiyar (dead) by L.Rs. v. Raja V. Rajeswararao (AIR 1973 SC 643), was a case where a Suit for partition was filed and there, the prayer was that the Court should direct the property to be sold by public auction, in exercise of its inherent power and to pay the plaintiff his one-half share in the net proceeds. The defendant filed a written statement and resisted the decree for sale. He also stated that he is ready and willing to buy the plaintiff's share, and that the Court may order valuation. Apparently, the plaintiff sought to withdraw the Suit. The said request was allowed with liberty to file a fresh Suit. The Apex Court dealt with two questions, firstly what is the scheme of Sections 2 and 3 of the Partition Act and secondly whether the court was justified in permitting withdrawal of the Suit and whether the defendant had acquired an indivisible right under Section 3 of the Act. The Court proceeded, inter alia, to hold as follows, after referring to Sections 2 and 3 of the Act: RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 9 “The scheme of Ss.2 and 3 apparently is that if the nature of the property is such or the number of shareholders is so many or if there is any other special circumstance and a division of the property cannot reasonably or conveniently by made, the court can in its discretion, on the request of any of the share- holders interested individually or collectively to the extent of one moiety or upwards, direct a sale of the property and distribute the proceedings among the shareholders. Now where a court has been requested under S. 2 to direct a sale any other shareholder can apply for leave to buy at a valuation the share or shares of the party or parties asking for sale. In such a situation, it has been made obligatory that the court shall order a valuation of the share or shares and offer to sell the same to the shareholder who has applied for leave to buy the share at a price ascertained by the court. In other words, if a plaintiff in a suit for partition has invoked the power of the court to order sale instead of division in a partition suit under S. 2 and the other shareholder undertakes to buy at a RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 10 valuation, the share of the party asking for sale, the court has no option or choice or discretion left to it and it is bound to order a valuation of th share in question and offer to sell the same to the shareholder undertaking or applying to buy it at a valuation. The purpose underlying the section undoubtedly appears to be to prevent the property falling into the hands of third parties if that can be done in a reasonable manner. It would appear from the Objects and Reasons for the enactment of the partition Act that as the law stood the court was bound to give a share to each of the parties and could not direct a sale or division of the proceedings. There could be, instances where there were insuperable practical difficulties in the way of making an equal division and the court was either powerless to give effect to its decree or was driven to all kinds of shifts and expedients in order to do so. The court was, therefore, given a discretionary authority to direct a sale where a partition could not reasonably be made and the sale would, in the opinion of the court, be more beneficial to the parties. But, having regard to the strong attachment of the people in RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 11 this country to their landed possessions, the consent of the parties interested at least to the extent of a moiety in the property was made a condition precedent to the exercise by the Court of the new power. At the same time, in order to prevent any oppressive exercise of this privilege, those shareholders who did not desire a sale were given a right to buy the others out at a valuation to be determined by the Court.” The Court proceeded to hold that under Section 3 of the Act, there is a right with the shareholder and the Court has no option. “11. A question which presents a certain amount of difficulty is at what stage the other shareholder acquires a privilege or a right under S. 3 when proceedings are pending in a partition suit and a request has been made by a co-owner owning a moiety of share that a sale be held. One of the essential conditions for the applicability of S. 2 of the Partition Act is that it should appear to the court that a division of the property cannot reasonably or conveniently be made. To attract the applicability of S. 3, all that the law requires is that the other shareholder should RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 12 apply for leave to buy at a valuation. Once that is done, the other matters mentioned in S. 3(1) must follow and the court is left with no choice or option. In other words, when the other shareholder applies for leave to buy at a valuation, the share of the party asking for a sale, the court is bound to order valuation of his share and offer to sell the same to such shareholder at a price to be ascertained.” In Somnath Bose v. Manasendra Nath Bose and Others (AIR 1983 Calcutta 265) which arose under the Act, the Court had directed sale to the shareholders offering the highest price. The Division Bench of the Court held that the applicant/co-sharer could not subsequently challenge the order and ask for a sale to him at the Court's valuation. Learned counsel for the petitioner would point out that the facts are distinguishable in so far as, the applicant therein had himself participated and unlike the facts in the said case, in this case, the petitioner/appellant had not given his consent for holding an auction among the sharers. We may notice that in the said case, the Court states that prima facie the application made RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 13 by the respondents' counsel was not an application under Section 2. A learned Single Judge of this Court in Sathi Lakshmanan v. Mohandas (2008 (4) KLT 401), inter alia, held as follows: "15. The legal position can thus be summed up as follows: “(1) In a suit for partition, if it appears to the court for the reasons stated in S.2 of the Partition Act that a division of the property cannot reasonably and conveniently be made and that sale of the property would be more beneficial to all the sharers, court has to direct sale. The sale so contemplated is definitely a public sale. But the order for sale can be made only on the request of the shareholders interested individually or collectively to the extent of one moiety or upwards. (2) When such a request is made to the court to direct a sale, any other shareholder or shareholders can apply under S.3 of the Act for leave of the court to buy the share of the party asking for sale, at a valuation. In such a case, court has to order valuation of the share of the party asking for sale. RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 14 (6) If there is no request as provided under S. 2 of the Act for sale of the property by a shareholder or shareholders interested individually or collectively to the extent of one moiety or upwards, S. 3 cannot have any application. (7) If Ss. 2 and 3 of the Act has no application, partition is to be effected dehors of the provisions of the Partition Act. (8) In such a case, if all the shareholders agree or the court finds that suit property is incapable of division in specie, it is for the court to devise the most appropriate and suitable method which is beneficial for all the shareholders for a just and fair division of the property. The court has the inherent power to devise the most suitable means. Court can allot the property to one share with a direction to pay owelty to the other sharers. Court can also direct a sale of the property among the shares or public and divide the sale proceedings among the sharers, depending on the facts and circumstances of each case. It cannot be said that in no case there cannot be a sale of the property among the sharers or a public sale. What is RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 15 the best mode of division in such a case is to be decided by the court on the facts of that case. Whatever be the course so adopted, it must be the most beneficial to all the sharers. It is not the interest of that shareholder in possession of the property is to be looked into, but the interest of all the shareholders.” 9. Passing on to the case law relied upon by the respondents, in L. Ram Prasad v. Mt. Mukandi and another (AIR 1929 Allahabad 443) rendered by a Bench of this Court, the request was apparently made by the plaintiff who was a 2/3rds sharer that the sale may be held and whoever among the co-sharers offered the highest bid may be given the property. The question which fell for consideration of the Court was whether the said request was a request under Section 2 of the Act. The Court held as follows: "We are of opinion that in order to see whether any request by a party amounts to a request for sale under S. 2, we must consider the exact request made by the party. In the present case, the request made by RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 16 the plaintiff, who is a two-thirds sharer, is that a sale may be held and that whoever among the co-sharers offers the highest bid may be given the property. It clearly does not contemplate a sale at which any outsider could bid and the plaintiff should have no option at any time whatsoever and under any circumstance whatsoever to retain possession of or buy in the whole property. If such a request is treated as a request under S. 2, it is apparent from S.3, Partition Act, that if the shareholder of a smaller interest chooses, he can ask for leave to buy the property at a valuation by the Court, and if he does not do so, then the property is to be sold under the provisions of S.6, partition Act, when the plaintiff can bid for the property to ensure that a proper price is obtained for the property at the sale. In our opinion, the partition Act must be construed strictly as the provisions of the Act, especially S. 3, exclude the right of the majority shareholder to acquire the property, the subject of partition at the option of the minority shareholder. On a reference to para. 5 of the plaint, it is clear that there was no unconditional request by the RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 17 plaintiff to sell the property, and we cannot accept the contention of the other side that when a conditional offer is made by the holder of the majority shares of the property, the plaintiff's request to buy at any valuation can be ignored at the mere will of the minority shareholder.” In (Darbhamulla) Subbamma v. Valivetti Veerayya and others (AIR 1932 Madras 15) a learned Single Judge of the said Court has surveyed various case law. The Court held as follows: "Independent of the Partition Act, the Court has on inherent power to refuse to divide a property by metes and bounds and to adopt such other means as may appear equitable, for effecting a just partition: AIR 1929 All. 443, Appr. : 11 IC 370, Ref. Where a sale is directed under S. 2, and S. 3 does not apply, it is nevertheless governed by S. 6: AIR 1926 Cal. 1190: 24 IC 273 and AIR 1927 All. 686, Expl.” In Sreedharan v. Bhaskaran (1963 KLT 692), the Court only reiterated that it has the general power of sale for equitable RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 18 distribution. The very same concept is seen reflected in the judgment in Sainaba And Others v. Abdurahiman Koya And Others (1982 KLT S.N. 31 (C.No.48). In Anthony Ammal v. Antony (1983 KLT 645), a learned Single Judge, apart from reiterating that even without request, the Court has power to order sale, held as follows: "R. 234 of the Civil Rules of Practice insists that in the case of a sale among the sharers only, the sale is to be conducted in open court. Simply because the Commissioner is an Officer of the court, it does not mean that a sale by him will be a sale in open court as insisted by R. 234 (2) of the Civil Rules of Practice.” That the Court's power to order sale where the property is incapable of partition dehors Section 2 of the Act, was reiterated again by a Division Bench of this Court in Parangodan v. Lakshmikutty (1993 (2) KLT S.N. 33 (C. No.33). Lastly, a learned Single Judge of this Court was dealing with a case in Sahasranama Iyer v. Ravindranathan (1999 (2) KLT SN 50 (C. No.54) which is, RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 19 on facts also, very apposite. The Court, inter alia, held as follows: "A reading of the plaint in this case would show that the plaintiffs had requested for sale of the properties among the sharers or in public auction. This request was not for sale of the properties in public auction only. This would mean that they have not given up the right to purchase the property and therefore, the request should not be construed as one for sale under S. 2 of the Partition Act. In these circumstances, I am not persuaded to hold that the plaint discloses the request for sale of the properties under S. 2 of the Partition Act.” We also notice that a learned Single Judge of the Rajasthan High Court in Ram Gopal v. Bhikam Chand and Others (AIR 1964 Raj. 229) also dealt with a case of request for sale among the shareholders and as to whether it was one contemplated under Section 2. The Court held, following the decision in Jadunandan Singh v. Bechan Koeri and Others (AIR 1929 Allahabad 442) and other case law, that such a request cannot result in the invocation of RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 20 Section 3(1) of the Act. 10. Learned counsel for the appellant would submit that there is nothing in Section 2 of the Act which would show that what is contemplated is a public sale. However, he would concede that there are observations in the judgment of the Apex Court in Badri Narain Prasad Choudhary v. Nil Ratan Sarkar (AIR 1978 SC 845), which detract from the said proposition. Therein, the Apex Court, inter alia, held as follows: "13. It will be seen from the above analysis that the request contemplated in No.(i) is a sine qua non for directing a sale because such a request necessarily signifies his willingness to have his share converted into money, so that the cosharers may, by means of the procedure provided in S. 3 buy them out. The request for sale envisaged by S. 2 must be one for public sale. If no such request has been made to the Court, S. 3 cannot be brought into operation.” 11. Counsel for the appellant/petitioner would submit that it may not be treated as a ratio decidendi of the case and it should be RFA.NO.777/2011 F & OP(C) NO.3310/2011 O 21 treated