9 Jan 2023 10:30 AM GMT
In a recent case Justice B.S. Bhanumathi of Andhra Pradesh High Court set aside the order of the Execution Court for sale of attached property at a meager value to satisfy a small decretal amount. “The suit schedule property is a land of five acres. Selling the same for Rs. 9,50,000/- during the year 2018 ex facie appears to be shockingly disproportionate to the value of the...
In a recent case Justice B.S. Bhanumathi of Andhra Pradesh High Court set aside the order of the Execution Court for sale of attached property at a meager value to satisfy a small decretal amount. “The suit schedule property is a land of five acres. Selling the same for Rs. 9,50,000/- during the year 2018 ex facie appears to be shockingly disproportionate to the value of the property, Furthermore, the amount paid to Decree Holder after the sale is Rs. 1,12,499/-. Therefore, a portion of schedule property would have been sufficient to discharge the whole decretal amount.”
The suit was initially filed by the plaintiff/Decree Holder in the present case basing on a registered mortgage deed, borrowing an amount of Rs. 50,000/- repayable with interest at 18% per annum and for suit costs. The suit was decreed for a sum of Rs. 77,172,60 and with further interest at 6% per annum.
The Decree Holder filed Execution Petition for realization of the decreed amount by putting 5 Acres schedule of property for sale as per Order 21 Rules 64 to 66 CPC for realization of Rs. 90,024/- with EP costs and further interest.
The Judgment Debtor filed counter opposing the execution proceedings stating that he was willing to pay Rs. 10,000/- per month to discharge the decretal debt.
Thereafter, the JDr did not fully satisfy the decree and allowed the sale to be proceeded with. The petition schedule property was put to sale through public auction and one Sambasiva Rao was the highest bidder for Rs. 9,35,000/- in the sale.
Hence, the execution Court confirmed the sale, recorded full satisfaction and terminated the execution petition.
Finding of the Court
Without challenging the sale before the Execution Court, the revision petitioner/Judgment Debtor filed the revision petition mainly contending that the EP schedule property values more than Rs. 1 crore, but the same was put to sale in auction for Rs. 9,35,000/- only and that since the revision petitioner is a lecturer drawing salary of Rs. 70,000/- per month, the execution Court erred in passing the impugned order by not granting time to pay Rs. 10,000/- per month.
Order 21, Rule 64 deals with power of court to order property attached to be sold and proceeds to be paid to person entitled. A plain reading of provision indicates that an execution Court must sell such portion of property as may be necessary to satisfy the decree.
The Single Judge referred to the decision of the Apex Court in Ambati Narasayya v. M. Subba Rao & Ors., 1989 wherein it was held as
“If the property is large and the decree to be satisfied is small, the Court must bring only such portion of the property, the proceeds of which would be sufficient to satisfy the claim of the decree holder. This, in our opinion, is not just a discretion, but an obligation imposed on the Court. Care must be taken to put only such portion of the property to sale the consideration of which is sufficient to meet the claim in the execution petition. The sale held without examining this aspect and not in conformity with this requirement would be illegal and without jurisdiction.”
In the present case, the Court observed as follows:
“Therefore, a portion of schedule property would have been sufficient to discharge the whole decretal debt. Without examining whether a part of the petition schedule property can be sold for realization of the decretal debt, or recording reasons for putting the whole property to sale, the execution Court has committed a grave error by not following the dicta in Order XXI Rule 64 CPC.”
On the above finding that sale that took place was a for a very meager amount, the Civil Revision Petition was allowed and the order of the Execution Court was set aside. The decretal amount was deposited in Court by the JDr.
Case Title: Mandati Tirupathi reddy Versus Immadisetti Venkata Narasimha Rao
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Citation: 2023 LiveLaw (AP) 2