Case: Gopal Krishna Das Vs. Sailendra Nath Biswas &amp; Anr

1. Premises No. 4-A. Chowringhee Road, Calcutta, belonged to the appellant Gopal Krishna Das and four others, each having an undivided one-fifth share therein. In 1951, one Ganga Prosad Gupta obtained two money-decrees against the appellant and another person in the total sum of Rs. 12,378. In execution of these decrees, the undivided one-fifth share of the appellant was put to sale on June 16, 1954 and was purchased by Pashupati Nath Biswas, the father of the first respondent, for Rs. 77,040. Pashupati Nath Biswas deposited Rs. 19,260 in the Court, being 25% of the purchase price and later he deposited a further sum of Rs. 15,000. He, however, failed to pay the balance of the purchase price whereupon the appellant made an application that the property be put to a fresh sale. Accordingly, the property was put to sale on March 20, 1957 and once again Pashupati Nath Biswas was the highest bidder. But whereas in the first sale he had offered a bid of Rs. 77,040 this time the sale was knocked down in his favour for a paltry sum of Rs. 700. The second sale was confirmed on May 29, 1957.2. In the meanwhile, on May 16, 1957 the Sheriff certified under Order XXI, Rule 71 of theCode of Civil Procedure that the deficiency in the price realised in the second sale due to the default of the auction purchaser, after giving him credit in the sum of Rs. 15,000 paid by him in the first sale, amounted to Rs. 61,340 apart from the cost and expenses of the sales.3. On June 28, 1957 the appellant made an application under Order XXI, Rule 71 C.P.C. for recovering the deficiency from Pashupati Nath Biswas. A learned single Judge of the Calcutta High Court allowed that application and directed by an order dated August 19, 1958 that Pashupati Nath Biswas do pay to the appellant a sum of Rs. 42,080 with interest at 6% per annum. This order was challenged by Pashupati Nath Biswas in Appeal No. 10 of 1959.4. The auction purchaser had also filed an application asking that the appellant be restrained from taking execution proceedings for recovering the deficiency in price. That prayer was rejected. It may be mentioned that pursuant to an application dated April 13, 1957 filed by the auction purchaser himself, it was directed by an order dated May 21, 1957 that a sum of Rs. 22,000 be paid by the Sheriff out of the sale proceeds lying with him, to the Official Receiver in satisfaction of the decree obtained by Ganga Prosad Gupta against the appellant, in execution of which the two sales were held. Ganga Prosad Guptas estate it seems, had come to be vested in the Official Receiver, who is the second respondent to these appeals. The auction purchaser prayed that the Sheriff do pay to him the balance after deducting therefrom the sum of Rs. 22,000 and the cost and the expenses of the Sheriff. This prayer was also rejected. The auction purchaser filed Appeal No. 9 of 1959 against the order rejecting this application.5. The appellant then filed an application for an order directing that the Sheriff do pay to him all the moneys lying with him after deducting the cost and the expenses of the sales. That application was allowed by the learned single Judge on December 11, 1958. The auction purchaser challenged that order in Appeal No. 43 of 1959.6. The three appeals were heard together and disposed of by a Division Bench of the Calcutta High Court by three separate judgments. By its judgment dated March 21, 1967 the Division Bench allowed appeal No. 10 of 1959 and dismissed the application filed by the appellant under Order XXI, Rule 71 for recovering from the auction purchaser the deficiency in the sale price. The two other appeals were disposed of consistently with that judgment. The auction purchaser Pashupati Nath Biswas having died on April 16, 1964, the first respondent Sailendra Nath Biswas came on the record of the appeals as his Executor and legal representative. On December 15, 1967 the High Court granted to the appellant leave to file an appeal to this Court under Article 133 (1) (a) and (c) of the Constitution.

Court's reasoning:
9. It is clear on a careful reading of Rule 71 that its application is limited to cases in which the deficiency of price has occurred by reason of the auction purchasers default. Property once put to sale in execution proceedings may have to be resold for reasons which may or may not be connected with the default of the auction purchaser. A re-sale consequent on the failure of the auction purchaser to deposit 25% of the purchase price immediately after he is declared to be the purchaser of the property or a re-sale consequent upon his failure to deposit the balance of the purchase price within 15 days of the sale are instances when the resale is occasioned by the default of the auction purchaser. On the other hand, re-sale consequent upon the setting aside of the sale on the ground of material irregularity in publishing or conducting the sale as provided in Order XXI, Rule 90, may not be attributable to the default of the purchaser. The provisions of Order XXl, Rule 71, come into play only if the property is required to be re-sold on account of the default of the auction purchaser. If the re-sale is not due to the auction purchasers default there can be no question of mulcting him with the deficiency in the price realised in there-sale may have to be held because the auction purchaser has committed default in paying the deposit of 25% under Order XXI, R. 84, or because of his default in paying the full price within 15 days of the sale as required by Rule 85. And yet the deficiency of price realised in the re-sale may not bedisclosure of that encumbrance in the sale proclamation accompanying the re-sale must, on normal commercial considerations, have a direct impact on the price of the property put to sale. In such a case the deficiency of price realised in the re-sale will be attributable not necessarily to the default of the auction purchaser but to circumstances extraneous to his default. Order XXI, Rule 71, concerns itself not with that class of cases but with those in which the deficiency of price realised in the resale is attributable to the default of the auction purchaser.It is unnecessary to enter into refinements arising out of the West Bengal Act but even the sub-tenants would appear to enjoy thereunder a certain amount of immunity from eviction.Order XXI, Rule 71 is intended to provide an expeditious remedy to the judgment-debtor or the decree-holder who has suffered a detriment due to the default of the auction purchaser. The officer or other person holding the sale has to certify to the Court the deficiency of price which on the re-sale has happened by reason of the purchasers default and all expenses attending the re-sale. Upon such certification the amount becomes recoverable from the defaulting purchaser at the instance of the decree-holder or the judgment- debtor, "under the provisions relating to the execution of a decree for the payment of money". The Code has not made the certificate conclusive of the facts stated therein and consequently it is permissible to the purchaser who is alleged to have defaulted to challenge the correctness of the certificate in all its particulars. But the object of certification, as evidenced even more clearly by the provision that the proceeding to recover the amount will be governed by provisions relating to the execution of a money-decree, is to eschew an elaborate inquiry into the competing causes culminating in the deficiency of price. This object can be achieved only if the property successively put to sale is in material respects identical, that is to say, if the right, title and interest of the judgement debtor is put to sale under substantially the same description. If that happens it is easy to predicate that the deficiency of price has resulted on account of the purchasers default. But if, as here, what was shown as unencumbered in the previous proclamation is expressly described in the later proclamation as being subject to an encumbrance which, on a reasonable assessment, is calculated to affect the market value of the property the proceeding ceases to be a simple enough matter like the execution of a money-decree and assumes the form of a contentious claim open to diverse defences as in a substantive suit. The speedy remedy intended to be provided by Order XXI, Rule 71 will lose its meaning and purpose if the executing court seized of the claim against the alleged defaulting purchaser has to embark upon a comparative evaluation of the causes that led to the deficiency in the price. Such meat is not for the executing court.14. Counsel for the appellant relied on certain decisions to fasten liability on the auction purchaser but those decisions will notWe are unable to appreciate the relevance of the maxim caveat emptor on a question like the one before us. The auction purchaser is not attempting to avoid the sale. Far from it, he adheres to his purchase but disputes his liability for the deficiency. There is no question of any failure on his part to take due care at the time of the first sale because that sale was held in 1954 whereas the encumbrance referred to in the second proclamation was stated to have been created in 1955.This is not a case in which the auction purchaser can be said to be taking advantage of his own wrong. He cannot therefore be estopped from contending that the disclosure of the encumbrance is the operative cause of the fall in price.19. We may mention that the matter under consideration arose out of the Ordinary Original civil jurisdiction of the Calcutta High Court and therefore the Original Side Rules of the High Court would govern the matter. That will, however, not make any difference to our decision because Chapter XXV, Rule 7 of the Rules of 1914 provides by the Third clause for re-sale of the property in default of the payment of the price by the purchaser within the stipulated time.We see no substance in this contention. The time requisite for obtaining certified copies undoubtedly means "the time properly required" and an appellant cannot in the computation of the period of limitation for filing the appeal ask for exclusion of time which was spent negligently. But the facts and dates mentioned to us by the appellants counsel show that the settlement of the draft decree was adjourned from time to time by an officer of the court on being properly satisfied that there was good reason for adjournment. The auction purchaser cannot be blamed for the time thus spent in settling the draft of the decree under appeal. The argument must therefore fail.