CR No.3025 of 2008 (O&M) 1 In the High Court for the States of Punjab and Haryana at Chandigarh. Decided on July 09,2010. Hardev Singh --Petitioner vs. Harbans Lal and others -- Respondents CORAM: HON'BLE MR.JUSTICE RAKESH KUMAR JAIN Present: Mr. S.C.Chhabra,Advocate,for the petitioner Mr.Vikas Kuthiala,Advocate for respondent Nos.1 to 3 Mr.R.L.Gupta,Addl.A.G.Punjab,for State of Punjab Rakesh Kumar Jain, J, By this common order, I shall be disposing of 10 Civil Revisions i.e. C.R.No.3025 of 2008 (Hardev Singh Vs. Harbans Lal and others);C.R No.3026 of 2008 (Mohinder Singh Vs. Harbans Lal and others) ; C.R No.3027 of 2008 (Kharaiti Lal Vs. Harbans Lal and others); C.R No.3028 of 2008 (Surjit Singh and others Vs. Harbans Lal and others); C.R No.3029 of 2008 (Ashwani Kumar and another Vs. Harbans CR No.3025 of 2008 (O&M) 2 Lal and others); C.R No.3030 of 2008 (Tek Chand Vs. Harbans Lal and others); C.R No.3031 of 2008 (Des Raj Vs. Harbans Lal and others); C.R No.3032 of 2008 (Chaman Lal Vs.Harbans Lal and others); C.R No.3033 of 2008 (Suman Kumar Vs.Harbans Lal and others) filed by the private persons and one C.R No.1511 of 2008 titled as State of Punjab Vs. Harbans Lal and others filed by the State of Punjab against the similar impugned order passed by the Executing Court on an application filed by the Auction Purchaser for extension of time. All the aforesaid ten revision petitions are being disposed of together as common questions of fact and law are involved in them. However, for the sake of convenience, the facts are being extracted from Civil Revision No.3025 of 2008 (Hardev Singh Vs. Harbans Lal and other). In brief, facts of the case are that land of one Bharawan Bai bearing khasra No.37/15 (8-0), 16 (8-0), 38/11 (8-0), 20 (8-0) and 21 (8-0) situated in the revenue estate of village Jalalabad (West) was acquired by the Department of Colonization, Punjab, through the agency of Land Acquisition Collector, for the public purpose, namely, for construction of Grain Market. The Land Acquisition Collector, announced his award dated 30.3.1978. The landowner/ Bharawan Bai, who was unsatisfied with the award of the Collector, filed objections under Sections 18 of the Land Acquisition Act,1894 (for short,'the Act') for further enhancement of compensation in which, vide land acquisition case No.332 dated 27.7.1998, the compensation was enhanced by the Court of Sh.Jaspal Singh, Addl.District Judge, Ferozepur vide his order dated 25.4.2001. The land owner/Bharawan Bai is thus called the decree holder (for short,DH) and the CR No.3025 of 2008 (O&M) 3 Department of Colonization, Punjab, the Judgment Debtor (for short,JD). After acquisition of land, Department of Colonization carved out some shops in the land falling in khasra No.37/15 (8-0) and 16 (8-0) total measuring 16 kanals. Out of the said shops, shops No. 51 to 61 were sold to the present petitioners in an open auction on 22.11.1982 by the Department of New Mandi Township, Punjab, for a consideration of Rs 1,07,000/- per shop. After allotment, sale deeds were executed by the Government in favour of the auction Purchasers/petitioners, who became the absolute owners of shops Nos.51 to 61. They obtained necessary licenses from the Department of Food and Supplies and Market Committee, Jalalabad, for running the business of Commission Agents and are occupying the said shops, wherein they have got electric and telephone connections. In nutshell, all the revision petitioners are in possession of the aforesaid shops which are fully functional as Commission Agents shops. The other aspect of the case is that the decree holder Bharawan Bai, in order to realize the enhanced compensation awarded in terms of the orders passed by the Addl.District Judge, Ferozepur dated 25.4.2001, filed execution applications against the Department of Colonization, Punjab (JD), pursuant to which land bearing khasra No. 37/15 (8-0), 16 (8-0) was ordered to be attached by the Executing Court, in lieu of payment of Rs.9,85,408.50 paise to be made to the decree holder, vide Rapat No.1036 dated 08.5.2002 and then land bearing khasra No. 37/15 (8-0) and 16 (8-0) was sold in open auction to Jasneek Singh son of Pritam Singh for a sum of Rs.10,21,000/- on 2.11.2004. He deposited 25% of the sale consideration i.e. Rs.2,55,250/- at the spot with the Tehsildar, Jalalabad, which was further deposited by the Tehsildar in the appropriate head under the orders CR No.3025 of 2008 (O&M) 4 of the Court on 6.11.2004. However, the Department of Colonization/judgment debtor also deposited the amount of compensation to be paid to Bharawan Bai/decree holder to the tune of Rs. 8,69,611/- vide cheque No. 187074 dated 24.11.2004. The said amount of Rs.8,69,611/- has been realized by legal representatives of the deceased Bharawan Bai on 11.10.2005. Jasneek Singh, Auction Purchaser, who had deposited only 25% of the sale consideration of Rs.10,21,000/-, filed an application dated 29.11.2004, seeking permission of the Court to deposit balance amount of 75% of the sale consideration. It is further pertinent to mention here that no reason whatsoever was assigned in the application for not depositing the balance 75% earlier. The said application for extension of time has been allowed by the learned Executing Court by the impugned order granting him one month's time from the date of the impugned order giving liberty to the Colonization Department/ judgment debtor to receive the said amount deposited by Jasneek Singh and further ordered that on the deposit of balance auction money i.e.75%, the auction dated 02.11.2004 shall be treated to be confirmed. It was also ordered that if the balance amount of 75% is not deposited, then the application for extension of time shall be deemed to be dismissed. It was also ordered that “as per record, the decree holders have already realized the execution of the amount which was deposited by the judgment debtor”. Both the State of Punjab as well as the present revision petitioners were aggrieved against the impugned order passed by learned Addl.District Judge, Ferozepur by which the time has been extended in favour of Jasneek Singh, Auction Purchaser for the purpose of depositing the balance consideration of 75%. Therefore, the State of Punjab challenged CR No.3025 of 2008 (O&M) 5 the said order by way of Civil Revision No.1511 of 2008 in which operation of the impugned order was stayed. The other nine Civil Revisions have been filed by the private persons whose shops have been sold in the name of selling the land falling in khasra No.37/15 (8-0), 16 (8-0). In the present Civil Revision No.3025 of 2008 from which the facts are being extracted, operation of the impugned order dated 19.12.2007 passed by learned Addl.District Judge, Ferozepur was stayed. It was also ordered that the present Civil Revision be heard with Civil Revision No.1511 of 2008. It was admitted on 10.2.2009 and was ordered that “status-quo regarding the continuation of possession in property shall continue and the amount deposited by the Court Auction Purchaser to be invested with a Nationalized Bank for a minimum period of two years and the amount received by accrual of the interest shall become ultimately payable to the party, depending on the outcome of the Civil Revisions”. Mr.S.C.Chhabra, learned counsel for the petitioners has firstly submitted that after the acquisition of the land falling in khasra No.37/15 (8- 0) and 16 (8-0), the New Mandi Township, Punjab had developed a Grain Market on the said land carving out shops which were sold to the revision petitioners in the open auction on 22.11.1982 against a valuable consideration of Rs.1,07,000/-. The revision petitioners are in possession of their respective shops and are working as Commission Agents having electric and telephone connections in their shops and, therefore, the land was not available for auction for the purpose of realization of the amount of compensation to be paid by the judgment debtor to the decree holders and thus could not have been attached and sold in execution. Secondly, the amount of compensation had already been deposited by the judgment CR No.3025 of 2008 (O&M) 6 debtor in the Executing Court which had been disbursed to the decree holders as is apparent from the concluding part of the impugned order where the learned Court below has observed that “as per record, decree holders have already realized the execution amount which was deposited by the judgment debtor/respondent-department”, therefore, there was no occasion for putting the shops for sale by way of auction for Rs.10,21,000/- on 2.11.2004 which was purchased by the revision petitioners in the year 1982. Thus, it was argued that the property worth crores of rupees has been sold illegally in favour of Jasneek Singh/Auction Purchaser, whereas the price of the real estate were never static to say that it would fetch the same price after the expiry of period of 22 years in a place like Jalalabad. Thirdly and finally, learned counsel for the petitioners has submitted that even for the sake of arguments, the aforesaid factors do not find favour with the Court, the application filed by the Auction Purchaser for extension of time was not maintainable and could not have been allowed by the learned Executing Court. It is submitted that there is no provision under the Code of Civil Procedure,1908 (for short,CPC;) for extension of time fixed for the purpose of deposit of balance 75% by the respondents and also the Executing Court had no jurisdiction to extend the time for the purpose of deposit of 75% of the balance sale consideration. Learned counsel for the petitioners has referred to the provisions of Order 21 Rules 84, 85 and 86 of the CPC and has relied upon decision of the Supreme Court in the case of Manilal Mohanlal Shah and others Vs. Sardar Sayed Ahmed Sayed Mahmad and another AIR 1954 Supreme Court 349; Gangabai Gopaldass Mohata Vs. Fulchand & Ors 1997 (1) Apex Court Journal 258 (S.C); a decision of this Court CR No.3025 of 2008 (O&M) 7 in the case of Nichhattar Singh and others Vs. Babu Khan and others AIR 1972 Punjab and Haryana 204; Mohinder Singh Vs.Additional District Judge, Sangrur, 1991 (2) P.L.R. 334; Fauja Singh Vs. Mohinder Singh 2003 (3) P.L.R.520;Satish Chopra and another vs. Suraj Parkash and others 2007 (4) R.C.R.(Civil) 324; Ilam Singh Vs. VIth Addl.District Judge, Muzaffarnagar & others 1990 Civil Court Cases 759; and Dasarla Koteswaramma Vs.Alla Venkayamma AIR 2009 Andhra Pradesh 195. On the other hand, Mr.Vikas Kuthiala, learned counsel for the Auction Purchaser Jasneek Singh has very fairly admitted that 25% auction price was paid by the Auction Purchaser at the time of bid on 2.11.2004. The remaining 75% was not deposited up to 17.11.2004, rather the application was filed on 29.11.2004 for the purpose of seeking permission of the Court to deposit the same. He has conceded that there is no provision in law under which the period for the purpose of deposit of balance 75% of sale consideration can be extended. However, to support the impugned order, he has relied upon two decisions in the cases of Kaur Singh Vs. Hardev Kaur 1993 (3) P.L.R. 651 and Uco Bank Vs. Gian Chand 1994 (3) R.R.R. 315. I have heard learned counsel for the parties and have perused the record with their assistance. Before adverting to the rival contentions raised by the learned counsel for both the parties, it would be appropriate to refer to the provisions of law:- “Order 21 Rule 84. Deposit by purchaser and re-sale on default.- (1) On every sale of immovable property the person declared to be the CR No.3025 of 2008 (O&M) 8 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 conduction 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. Order 21 Rule 85. Time for payment in full of purchase-money.- The full amount of purchase-money payable shall be paid by the purchaser into Court before the Court closes on the fifteenth day from the sale of the property: Provided that, in calculating the amount to be so paid into Court, the purchaser shall have the advantage of any set-off to which he may be entitled under rule 72. Order 21 Rule 86. 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.” A careful reading of the aforesaid Order 21 Rule 84 of CPC provides that in case of immovable property in execution of a decree by the Court, the Auction Purchaser is required to pay 25% of the sale consideration immediately at the time of bid. In case of default in deposit of 25%, the Court Auction Purchaser had the power to resell the property in question. As per Order 21, Rule 85 of CPC, the Auction Purchaser is required to pay the full amount of purchase money in Court before the CR No.3025 of 2008 (O&M) 9 Court closes on the 15th day from the sale of property, meaning thereby that the auction Purchaser had to deposit the remaining 75% of the sale consideration on or before the 15th day from the date of deposit of 25% in terms of Order 21 Rule 84 of CPC. Order 21 Rule 85 of CPC provides the effect of non-payment of 75% of the balance sale consideration, according to which in case of default of payment of 75% within 15 days from the date of deposit of 25%, the Court, after defraying the expenses of the sale amount deposited by the Auction Purchaser shall forfeit to the Government the sale consideration and the property shall be resold and the defaulting purchaser would forfeit his amount of his claim to the property or to any part of sum for which it is subsequently sold. As a matter of fact, Order 21 Rule 86 of CPC puts a clog on all equities because in case of non-payment of 75% of the balance sale consideration as envisaged under Order 21 Rule 85 of CPC, the Auction Purchaser not only loses his right to the property which is auctioned by the Court but also his right of reimbursement of the amount of 25% which was deposited by him in terms of Order 21 Rule 84 of CPC. Now the question is as to “whether the provisions of Order 21 Rules, 84, 85 and 86 of CPC are mandatory in nature ? and “whether the Court had the jurisdiction to extend the time or in other words, grant permission to the Auction Purchaser to deposit the balance sale consideration of 75% after the expiry of period of 15 days from the date of deposit of 25% ?. In respect of the first question, as to whether the provisions of Order 21 Rules 84,85 and 86 of CPC are mandatory or not the Supreme Court, in the case of Manilal Mohan lal (Supra) has held that these CR No.3025 of 2008 (O&M) 10 provisions are mandatory as non-compliance of Order 21 Rules 84 and 85 of CPC renders the sale void. A similar view has been taken by the Supreme Court in the case of Gangabai Gopaldass Mohata (Supra) . In respect of the second question, as to whether the Court had the jurisdiction to extend the time or give permission to the Auction Purchaser to deposit the balance sale consideration after the expiry of 15 days from the date of deposit of 25% sale price, this Court had taken a view in case of Nichhattar Singh (Supra) that the Court had no jurisdiction to extend the time to deposit the balance sale price. A similar view has been taken in the case of Mohinder Singh (Supra), Fauja Singh (Supra), Satish Chopra (Supra), Ilam Singh (Supra) and Dasarla (Supra). Thus, consistent view of the Supreme Court as well as of different High Courts is that Order 21 Rule 85 of CPC is mandatory and the time to deposit the balance sale consideration cannot be extended even on an application moved under Section 148 of CPC. The question is then, “whether the judgments relied upon by the learned counsel for the respondent are applicable”. In the case of Kaur Singh (Supra), which has been relied upon by learned counsel for the respondent, the observations made in para No.3 are as under:- “From the impugned order, I find that the application was dismissed by the executing Court only on the ground that the auction-purchaser failed to deposit 1/4th amount on the date when the auction was held and further failed to deposit/pay the remaining 3/4th amount within stipulated period of fifteen days from the date of auction. It is not clear from the order as to whether any objections were filed by the judgment debtor in CR No.3025 of 2008 (O&M) 11 opposite to the prayer of the auction-purchaser for the issuance of sale certificate. If no such objections were filed and the judgment-debtor was not aggrieved with regard to deposit of amount, there was no reason for the executing Court to reject the prayer of the auction-purchaser for the issuance of sale certificate. It is also not clear from the impugned order as to whether the wife was paid the entire amount because Rs.10,500/- were deposited by the auction-purchaser in Court on 10.6.1991. The order under revision, therefore, cannot be sustained”. The aforesaid order is based upon its own facts because in that case, nothing was clear from the impugned order as to whether no objection was filed by the judgment debtor to oppose the prayer of the Auction Purchaser. Therefore, the said precedent cannot be followed. Other judgment in the case of Uco Bank (Supra) is rendered by the Himachal Pradesh High Court in which permission was granted to the Auction Purchaser to deposit 75% of the sale consideration after due date for the following reasons:- “This Court is in respectful agreement with the view taken by Gujarat High Court. Applying it to the facts and circumstances of the present case the auction purchaser cannot be held defaulter, because he was misled by the directions of auctioneer, the Tehsildar' Palampur. He had deposited 25% of the sale price at the time of auction in compliance with Rule 84 of Order 21 C.P.C. He could not deposit the remaining amount of 75% in compliance with Rule 85 Order 21 C.P.C., as he was made to understand by the auctioneer the Tehsildar Palampur CR No.3025 of 2008 (O&M) 12 that he was to deposit the balance of the sale price after the sale is confirmed by the High Court. The order dated 7.3.1989 confirming the sale and directing him to deposit the balance of the sale price within three weeks, was not passed in his presence and the notice of it was sent to him as late as on 19.3.1990, by which date he had already deposited the balance of the sale price on receipt of notice dated 27.12.1989 seeking his clarification whether he had deposited the auction money or not. There is nothing on record to show that he was negligent”. However, in the present case, no reason whatsoever has been assigned by the Auction Purchaser in his application dated 29.11.2004 for seeking permission of the Court to deposit the sale consideration after the expiry of statutory period of 15 days as provided under Order 21 Rule 85 of CPC. Thus, the facts of the case of Uco Bank (Supra) are also distinguishable. The upshot of the entire discussion is that the provisions of Order 21 Rules 84, 85 and 86 of CPC are mandatory. On the failure of deposit 75% of the balance sale consideration within 15 days from the date of deposit of 25%, the sale proceedings would become non-est and a nullity and the Executing Court would have to put up the property in question for resale in terms of Order 21 Rule 86 of CPC and would have no jurisdiction to extend the time for payment of balance sale consideration. Moreover, in the present case, payment has already been made by the State of Punjab to the decree holders, therefore, it is totally inequitable to sell the shops of the petitioners which were purchased by them in the year 1982 against a valuable consideration. Thus, looking from any angle, the impugned order is CR No.3025 of 2008 (O&M) 13 patently illegal. Hence, the Civil Revisions are allowed and the impugned order is hereby set aside with costs through out. July 09,2010 (Rakesh Kumar Jain) RR Judge