Case: Tribhuvandas Purshottamdas Thakur Vs. Ratilal Motilal Patel

1. Respondents 1 to 4 and respondent No. 6 are the trustees of a public trust, styled "Shri Tricumraiji". In March 1950 the trustees mortgaged a house belonging to the trust to one Saheba to secure repayment of Rs. 5,000/-. An action instituted by the mortgagee against the trustees to enforce the mortgage was compromised, and it was decreed that the trustees do pay Rs. 3,910/- due under the mortgage by monthly instalments of Rs. 100/- each, and in default of three instalments the entire amount remaining unpaid shall become due and recoverable from the mortgaged property. The trustees did not pay the instalments due under the decree, and in an application for execution by the mortgagee the mortgaged property was put up for sale and the bid of the appellant was accepted for Rs. 5,000/- by the executing Court. The trustees thereafter applied under O. 21, R. 89 of theCode of Civil Procedure for setting aside the sale and deposited Rs. 250/- being 5% of the purchase-money for payment to the appellant and Rs. 63/- for payment to the mortgagee, claiming that in consideration of the latter amount the mortgagee had agreed to "give to them six months" for payment of the mortgage amount, and had agreed in the meantime to abandon the application for execution. The Subordinate Judge passed an order disposing of the execution application and directed that Rs. 250/- out of the amount deposited by the trustees be paid over to the appellant. In appeal against that order by the appellant, the District Court reversed the order holding that since the trustees had failed to comply with the requirements of R. 89 of O. 21,Code of Civil Procedure, the executing Court had no jurisdiction to set aside the sale. The High Court of Gujarat in exercise of powers under S. 115 of theCode of Civil Procedure set aside the order of the District Court. Raju, J., held that sale of the mortgaged property which belonged to a public trust, without the sanction of the Charity Commissioner being prohibited by S. 36 of the Bombay Public Trusts Act, was invalid, and on that view remanded the case to the District Court "for decision on all the points correctly arising nut of the matter". Against that order, this appeal has been preferred with special leave.

Court's reasoning:
We are unable to agree with that view. Obviously, the transactions of mortgage, exchange, gift or lease of any immovable property in Cls. (a) and (b) contemplated to be made by the trustees are voluntary transactions, and in the absence of any clear provision in the Act, the expression "sale" in Cl. (a) would only mean transfer of property by the trustees for a price. Section 36 occurs in Ch. V relating to Accounts and Audit, and is one of the provisions which imposes restrictions on the powers of the trustees. There is nothing to indicate, either in the words of the Section, or in the context in which it occurs, that the sale prohibited without sanction of the Charity Commissioner includes a Court sale in execution of a decree.For the purpose of the present case, we do not deem it necessary to express any opinion on the question whether a sale in exercise of authority derived from the trustees, e. g. a covenant for sale under an English mortgage executed by the trustees or a sale in terms of a consent decree attracts the application of S. 36 of Act. We have no doubt, however, that the Legislature did not intend to put any restriction upon the power of the Civil Court executing a decree for recovery of money due from the trust, by sale of the property of the trust.The Section imposes a fetter upon the power of the trustees: it is not intended hereby to confer upon the Charity Commissioner an overriding authority upon actions of the Civil Court in execution ofour judgment, that view also cannot be sustained.A suit to enforce a mortgage or a proceeding to enforce a mortgage decree against property belonging to a public trust is not a suit or proceeding in which a question affecting a public, religious or charitable purpose is involved.4. The District Court was, in our judgment, right in holding that the requirements of O. 21, R. 89 of theCode of Civil Procedure were not complied with and the Subordinate Judge had no power to set aside the sale held in execution of the decree.Order 21, R. 89 of the Code Of Civil Procedure which in terms applies to sale of immovable property in "execution of a decree" which expression includes execution of a decree for sale of mortgaged property, enables any person either owning, such property or holding an interest therein by virtue of a title to apply to have the sale set aside on his depositing inthe present case, the trustees of the trust had deposited Rs. 250 for payment to the auction purchaser. They also deposited Rs. 63 for payment to the decree-holder, but it is common ground that the claim of the mortgagee was not satisfied by that deposit. The first condition was therefore, fulfilled, but the second condition of O. 21, R. 84 was notin our Judgment is a futile argument.By abandoning the execution proceeding the claim of the creditor is not extinguished: he is entitled to commence fresh proceedings for sale of the property. Rule 89 of O. 21 is intended to confer a right upon the judgment-debtor, even after the property is sold, to satisfy the claim of the decree-holder and to compensate the auction purchaser by paying him 5% of the purchase-money. The provision is not intended to defeat the claim of the auction purchaser, unless the decree is simultaneously satisfied. When the Judgment creditor agrees to extend the time for payment of the amount due for a specified period and in the meanwhile agrees to receive interest accruing due on the amount of the decree, the condition requiring the Judgment debtor to deposit in Court for payment to the decree holder the amount specified in the proclamation of sale for the recovery of which the sale was ordered cannot be deemed to be compliedis unnecessary to venture an opinion whether these cases were correctly decided.It is sufficient to observe that an order setting aside a court sale in execution of a mortgage decree cannot be obtained, under O. 21, R. 89 of theCode of Civil Procedure by merely depositing 5% of the purchase-money for payment to the auction purchaser and persuading the decreeholder to abandon the execution proceeding.In considering whether a precedent of a Court of co-ordinate authority is binding, reference to S. 165 of the Evidence Act is irrelevant. Undoubtedly, every judgment must be based upon facts declared by the Evidence Act to be relevant and duly proved.But when a Judge in deciding a case follows a precedent, he only regards himself bound by the principle underlying the judgment and not by the facts of that case.13. It is true that every Judge of a High Court before he enters upon his office takes an oath of office that he will bear true faith and allegiance to the Constitution of India as by law established and that he will duly and faithfully and to the best of his ability, knowledge and judgment perform the duties of office without fear or favour, affection or ill will and that he will uphold the Constitution and the laws : but there is nothing in the oath of office which warrants a Judge in ignoring the rule relating to the binding nature of the precedents which is uniformly followed.