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Makhan Lal Kela And Anr. vs Baldeo Prasad And Ors.

High Court Of Judicature at Allahabad|26 April, 1938


JUDGMENT Rachhpal Singh, J.
1. This is a defendants' second appeal arising out of a suit for possession. The facts which have given rise to this appeal can briefly be stated as follows: On 17th August 1922, defendants 2nd party executed a mortgage deed for Rs. 1500 in favour of one Kunj Behari Lal in respect of the property in suit. Kunj Behari Lal obtained a final decree on foot of his mortgage in 1929. He put the mortgaged property to sale and himself purchased it at an auction sale on 20th August 1930.
2. On 18th August 1931, the plaintiffs in the present suit purchased the property in suit from the mortgagors of Kunj Behari Lal. Under the terms of the sale deed, the plaintiffs were to pay in the decree money due to Kunj Behari Lai. The plaintiffs made an application to the Court which had sold the property in execution of Kunj Behari Lal's decree under Rule 89 of Order 21, Civil P.C., for setting aside the sale. The Court dismissed the plaintiffs' application. They preferred an appeal and there a compromise was arrived at between the plaintiffs on one side and Kunj Behari Lal, the auction-purchaser decree-holder, on the other. Among other things, it was agreed that the plaintiffs would get the property in suit and in the sale certificate their names would be entered as auction-purchasers in place of Kunj Behari Lal. The Court accepted the compromise and passed an order directing that the application of the plaintiffs for setting aside the sale be allowed in the terms of the compromise. Under the terms of this compromise the names of the plaintiffs were substituted in the sale certificate for the name of Kunj Behari Lal and they obtained an order getting formal possession over the property in suit. Then they applied for mutation and there the defendants, appellants to the present suit resisted. It appears that the defendants who are appellants had a simple money decree against the mortgagors. They put the property in suit to sale in execution of their decree and purchased it at a Court sale on 27th October 1931, and got possession and mutation. The application made by the plaintiffs for mutation was thrown out and so the plaintiffs filed the suit which has given rise to the present second appeal. Their suit has been decreed by the lower Appellate Court. Several pleas had been taken in defence by the appellants but in this Court only one point has been urged which requires consideration.
3. Learned Counsel for the appellants has urged before me that the order of the Court on the basis of the above mentioned compromise was ultra vires and the Court had no jurisdiction to pass it. According to learned Counsel's argument, Kunj Behari Lall is still the owner of the property in suit and the plaintiffs acquired no right under the terms of the compromise. I have heard learned Counsel on both sides and) am of opinion that the contention raised by learned Counsel for the appellants is-sound and must be accepted. Rule 94 of Order 21, Civil Procedure Code enacts:
Where a sale of immovable property has become? absolute, the Court shall grant a certificate specifying the property sold and the name of the person who at the time of sale is declared to be the purchaser. Such certificate shall bear date the day on which the sale became absolute.
4. Section 65, Civil P.C. runs as follows:
Where immovable property is sold in execution,, of a decree and such sale has become absolute, the property shall be deemed to have vested in the purchaser from the time when the property is sold and not from the time when the sale becomes absolute.
5. It will be seen that the property vested in Kunj Behari Lal from the date of the sale by the Court and he became entitled to get the sale certificate because of the sale in his favour. Under the provisions of Rule 94, Order 21, Civil P.C., Kunj Behari Lal became entitled to get a sale certificate which is evidence of his title. The question for consideration is whether an auction purchaser is competent to make a valid transfer of property purchased by him at a Court sale by entering into an-agreement with a third party that he (auction-purchaser) would get his name (third party's) substituted in the sale certificate. I am clearly of opinion that such & mode of transfer cannot be recognized by law. The reason is that the auction-purchaser has become owner of the property and the title vested in him from the date-of the sale. If he wishes to transfer the property to anyone then he can do so only in the mode prescribed under the Transfer of Property Act. Parties cannot be permitted to adopt a new method of making transfer which is not recognized by the Transfer of Property Act. A sale certificate is not & title deed. It is only evidence of title which was vested in the auction-purchaser on the date on which he purchased the property.
6. The law recognizes only the method under which a man can sell his property to another and that is by a registered sale deed. There is however one exception and that is about transfers created by operation of law. In case where property is purchased by a person at a Court sale, no sale deed is necessary. The sale certificate which the Court will issue will show that the purchaser got a title and the property vested in him from the date of the sale. The sale certificate will not be a title deed but would be statutory evidence of transfer in place of the mode of transfer by a registered sale deed. Having regard to the provisions of Rule 94, Order 21, the Court will issue the sale certificate only in the name of auction-purchaser or if he dies in the name of his legal representative. But the Court is incompetent to recognize any transfer or arrangements made by the auction-purchaser with a third person. Take the following instance. A man purchases property at a Court sale. Later on, he makes an application to the Court that he has given or sold the property to another person and so in the sale certificate his (transferee's) name should be entered. I have no hesitation in holding that the Court selling the property would be wholly incompetent to alter the sale certificate. It would inform the applicant that the sale certificate would be issued only in the name of the auction purchaser. If the auction purchaser wants to dispose of his interest in the estate purchased by him then he can do so by executing a valid sale deed.
7. In the case before me the plaintiffs adopted the following method. They purchased the property from the mortgagors. They, long after the date for filing objections to the sale had expired, made an application asking that the sale should be set aside. During the pendency of the case the plaintiffs and the auction purchaser compromised under which the latter agreed that the names of the plaintiffs should be substituted in the sale certificate for his name. In my opinion, the Court was not competent to do so. Its order directing a decree to be prepared in the terms of the compromise was beyond its jurisdiction and is ultra vires. The learned Judge of the lower Appellate Court has relied on a Full Bench ruling of this Court, Shyam Lal v. Shyam Lal (1933) 20 A.I.R. All. 649, in support of his view. In my opinion that case cannot help the plaintiffs. It will be seen that in the above-mentioned case the learned Judges made the following observations which are to be found at p. 238:
Except in case where the Court has no jurisdiction to entertain the matter at all, a wrong decision would make the decree valid and binding on the parties.
8. It appears to me that in the case before me the decree made by the Court on the basis of the above-mentioned compromise was beyond jurisdiction of the Court and so the case has no application. The law empowers the Court which has sold the property to sell the property and to grant the sale certificate only to the auction-purchaser in whom the property vested on the date of the sale. The Court has no power to recognize any agreement between the auction-purchaser and others under which the auction purchaser makes a. transfer. A purchaser who purchases property from auction-purchaser under a valid and a registered deed cannot go to the executing Court and say that his name should be entered in the sale certificate on the ground that he has purchased the property. Much less can a man who has not taken the precaution of getting a sale deed in his favour. I hold that the decision of the Court on the basis of the compromise directing that the names of the plaintiffs should be substituted for Kunj Behari Lal was beyond its jurisdiction and ultra vires and therefore the plaintiffs acquired no title to the property in suit. In law Kunj Behari Lal is still its owner. In these circumstances, the plaintiffs have no right to sue the defendants-appellants for posses. sion. The appeal must therefore be allowed.
9. For the reasons given above, the appeal is allowed, the decree of the lower Appellate Court is set aside and the plaintiffs' suit is dismissed with costs of the appellants in all the Courts. Permission to file a Letters Patent Appeal is granted.
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Makhan Lal Kela And Anr. vs Baldeo Prasad And Ors.


High Court Of Judicature at Allahabad

26 April, 1938