Radhy Shyam Vs. Shyam Behari Singh
 INSC 156 (12 August 1970)
12/08/1970 SHELAT, J.M.
CITATION: 1971 AIR 2337 1971 SCR (1) 783
Letters Patent-Allahabad High Court-Clause
10-If order on Application under Order 21 r. 90 C.P.C. is a 'Judgment'.
Civil Procedure Code, 1908, Order XXI, rules
69, 90Material irregularity in auction sale What is.
After the respondent had obtained a decree
for about Rs. 9,000/against the appellant, the appellant's share in a house was
put up for sale in execution proceedings initiated by him and a proclamation
setting out the date and hour for the sale was issued. But the sale was
postponed at the instance of the appellant. At the auction sale held on the
adjourned date the respondent purchased the appellants share for Rs. 8,000/-.
The appellant thereafter filed an application for setting aside the sale under
Order XXI, r.90 C.P.C. on the ground that contrary to the provisions of r.69
the notice relating to the adjourned sale did not set out the hour when the
auction would be held and that this omission was a material irregularity which
vitiated the sale. Although the application was rejected by the Execution
Court, a single judge of the High Court upheld the appellant's objection
holding that the failure to set out the hour amounted to a material
irregularity. However, a Division Bench in an appeal under clause 10 of the
Letters Patent of the Allahabad High Court reversed the order.
In appeal to this Court it was contended (i)
that the order of the single judge was not a 'judgment' within the meaning of
cl. 10 of the Letters Patent and hence no Letters) Patent appeal could be filed
there under; and (ii) that the sale suffered from a material irregularity which
caused substantial injury to the appellant and was therefore liable to be set
HELD: Dismissing the appeal, (i) An order in
a proceeding under O.XXI, r.90 is a 'judgment' inasmuch as such a proceeding
raises a controversy between the parties therein affecting their valuable
rights and the order allowing the application certainly deprives the purchaser
of rights accrued to him as a result of the auction-sale. 'Me High Court was
there after right in holding that a Letters Patent appeal law against the order
of the single Judge. [789 C-D] (ii) Rule 90 of O.XXI of the Code, as amended by
the Allahabad High Court, inter alia provides that no sale shall be set aside
on the ground of irregularity or even fraud unless upon the facts proved the
Court is satisfied that the applicant has sustained injury by reason of such
irregularity or fraud. Mere proof of a material irregularity such as the one
under r.69 and even inadequacy of price realised in such a sale, in other words
injury, is, therefore, not sufficient. It has further to be shown that such
injury was the result of material irregularity. [789 E] The Division Bench of
the High Court was right in holding, on the facts in the present case, that the
appellant had failed to show inadequacy 784 of the price or that such inadequacy
was occasioned by the said material irregularity. [789 G] Standard Glass Beads
Factory v. Shri Dhar, A.I.R. 1960 All.
692 (F.B.); Piare Lai v. Madan Lai, A.I.R.
1917 All. 325;
Muhammad Naimullah Khan v. lbsanullah Khan,
(1892) 14 All.
226 (F.B.); Ram Sarup v. Kaniz Ummehani,
I.Y.R.  All, 886; Asrumati debi v. Kumar Rupendra Deb Raikot. 
S.C.R. 1159; Justices of the Peace for Calcutta v. Oriental Gas Co., 8 Beng.
L.R. 433; Tuliaram v. Alagappa, I.L.R. 35 Mad. 1; Dayabhai v. Murugappa
Chettiar, I.L.R. 13 Rang. 457;
State of Uttar Pradesh v. Vijay Anand
Maharaj,  1 S.C.R. 1, Begum Aftab Zamani v. Lai Chand Khanna, I.L.R. 
Delhi 34(F.B.); Shankarlal Aggarwal v. Shankar lal Poddar,  1 S.C.R. 717;
Mohan Lai Magan Lai Thacker v. Gujarat,  2 S.C.R. 685; and Tarapore &
Co. v. M/s. V/O Tractors Export, Moscow,  2 S C R 699 referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal.
No. 1569 of 1966.
Appeal by special leave from the judgment and
order dated August 22, 1961 of the Allahabad High Court in Special Appeal No.
417 of 1959.
Avadh Behari, for the appellant.
Mohan Behari Lal, for the respondents.
The Judgment of the Court was delivered by
Shelat, J. The respondent had obtained a decree for Rs.
9000/and odd against the appellant. In
execution proceedings taken out by him, the appellant's one fourth share in a
house was put up for sale and a proclamation setting out the date and hour when
the sale would be held was duly issued.
The sale, however, was postponed to July 30,
1956 at the instance of the appellant and on his offering to pay a part of the decrial
amount. At the auction sale held on the adjourned date the respondent himself
purchased the said one fourth share of the appellant for Rs. 8000/-. The
appellant filed an application for setting aside that sale under Order XXI, r.
90 of the Code of Civil Procedure on the ground that contrary to the provisions
of r. 69 of that Order, the notice relating to the adjourned auction sale did
not set out the hour when the auction would be held though the original
proclamation under which the auction sale was to be held on the earlier date
specified both the hour and the date. The appellant contended that the failure
to mention the hour contravened Order XXI, r. 69 and that such a contravention
was a material irregularity which vitiated the sale. The objection was
overruled by the Execution Court.
The appellant thereupon filed an appeal in
the High Court where a single Judge upheld the objection holding that the
failure to set out the hour amounted to a material irregularity, inconsequence
whereof the appellant had been prejudiced by the sale having fetched too 785
low a value. On these findings the learned Judge allowed the appeal and set
aside the auction sale. Aggrieved by the said order' the respondent filed. a
Letters Patent appeal under cl. 10 of the Letters Patent of the Allahabad High
Court and, rule 5 of Ch. VIII of the Rules of the High Court. A Division Bench
of the High Court reversed the order passed by the learned single Judge and
allowed the appeal. Following the Full Bench decision of that High Court in
Standard Glass Beads Factory v. Shri Dhar(1) the Division Bench rejected the
appellant's contention that no Letters Patent appeal lay against such an order
and held that the order of the learned single Judge was a 'judgment within the
meaning of cl.10 of the Letters Patent. The Division Bench further held that
even assuming that the sale suffered from a material irregularity the learned
single Judge was in error in holding that the appellant had established any
prejudice to him in consequence of that irregularity. The order of the learned
single Judge was reversed and the said sale was upheld. On the High Court
refusing a certificate, the appellant obtained special leave from this Court
and filed the present appeal.
In support of the appeal counsel for the
appellant raised two points: (1) that the said order of the learned single
Judge was not a judgment within the meaning of cl. 10 of the Letters Patent and
hence no Letters Patent appeal could be filed there under, and (2) that the
said sale suffered from a material irregularity which caused substantial injury
to the appellant and was therefore liable to be set aside. Counsel cited
certain decisions, in support of the contention that the order of the learned
single Judge was not a 'judgment' within the meaning of cl. 10 of the Letters
Patent. Some of these decisions however, are under ss. 109 and 1 1 0 of the
Code of Civil Procedure and Arts. 133 and 134 of the Constitution which would
have no bearing on the construction of cl. 1 0 of the Letters Patent. But
before we enter into the controversy as to the meaning of the term judgment in
cl. 10 it would be necessary to remember that the respondent having been
declared as the, highest bidder became the purchaser of the appellant's one
fourth share in the said property. No doubt the sale had to be confirmed by the
Court under r.92 of 0. XXI before it could become absolute and in the meantime
the appellant could apply under r. 90 to have it set aside. If the Court, on
such an application, were to pass an order setting aside the sale such an order
would clearly affect the rights acquired by the respondent as a result of the
sale. On the other hand, if the application were to be dismissed, such
dismissal affects the right of the judgment-debtor under r. 90. The application
under that Rule and the order made thereon, therefore, are not merely
procedural matters but are matters affecting the rights of both the (1) A. I.
R. 1960 All. 692 (F. B.) 9Sup.CI(P)171-6 786 auction purchaser and the
judgment-debtor. The question is whether such an order setting aside the sale
is a 'judgment' within the meaning of cl. 10 of the Letters Patent.
At one time the view held by the Allahabad
High Court was that no Letters Patent appeal could, lie against such an order.
Thus, in Piare Lai v. Madan Lal(1) it held, following its earlier decision in
Muhammad Naimullah Khan v. Ibsanullah Khan('), that no appeal lay under cl. I 0
of the Letters Patent from an order of a single Judge of the High Court
dismissing an appeal from an order of an executing court on an application
under 0. XXI, r. 90. That decision, however, was rendered, on a view that s.
104(2) of the Code debarred even a Letters Patent appeal under cl. 10.
Subsequently, the High Court abandoned that
view and held in Ram Sarup v. Kaniz Ummehani(3) that S. 104(2) did not affect
Letters Patent appeals from an order thereby falling in line with the other
High Courts (see Mulla, Code of Civil Procedure, (13th ed.) 452). None of these
decisions was on the question whether an order made under 0. XXL r. 90 was a
'judgment' or not.
In Standard Glass Beads Factory v. Shri Dhar
(4) the High Court of Allahabad construed the term judgment as including a
final judgment as also a preliminary and an interlocutory judgment and observed
that it did not exclude an order. On this view it held that an order passed by
a single Judge of the High Court dismissing an appeal against an order of
interim injunction was a 'judgment' within the meaning of cl. 10 of the Letters
Patent, and a Letters Patent appeal, therefore, lay thereunder against it.
Reliance, however, was placed on the decision in Asrumat Debi v. Kumar Rupendra
Deb Raikot(5) where the question was whether an order transferring a suit from
a subordinate court to the High Court under cl. 13 of the Letters Patent of the
Calcutta High Court was a 'judgment' within the meaning of cl. 15.
This Court held that it was not. In doing so
the Court referred to the divergence Of opinion amongst the Calcutta, Madras
and Ran on High Courts on the interpretation of the term 'judgment' in cl. 15
of the Letters Patent reflected in Justices of the Peace for Calcutta v.
Oriental Gas CO.(6), Tuljaram v. Alagappa(7) and Dadabhai v. Murugappa
Chettiar(8), but without resolving the divergence held that an order of
transfer of a suit did not fall within any one of the three aforesaid views,
and therefore, a Letters Patent appeal there from was not maintainable.
at page II 67 of the report stated that
although in such a case there would be a controversy between the parties as to
whether the suit should be tried by the (1) A. I. R. 1917 All. 325.
(3) I. L. R.  All. 886.
(5)  S. C. R. 1159 (7) I. L. R. 35 Mad.
(2)  14 All. 226 (F. B.) (4) A.I.R.
1960 All (P.D.) (6) 8 Beng. L. R. 433.
(8) L. R. 13 Rang. 457.
787 court where it was filed or in the High
Court which had to be determined, a decision on any and every point in dispute
between the parties to a suit was not judgment. Such an order did not affect
the merits of the controversy between the parties in the suit itself, nor did
it terminate or dispose of the suit on any ground, and therefore, could not be
placed in the same category as an order rejecting a plaint or one dismissing a
suit on a preliminary ground. it Will be noticed that the order in question was
on an application in the suit as a step in aid towards the determination of the
controversy between the parties in the, suit. It was, therefore, that the said
observation was made that the order sought to be appealed against did not
affect the merits of the controversy in the suit nor did it terminate or
dispose of the suit. For an order to be a 'judgment' it is not always necessary
that it should put an end to the controversy in the suit or should terminate
the suit. Even the narrower definition of a 'judgment as given by Couch, C.J.
in the Justices Of the Peace for Calcutta(1) was that it must mean a decision
which affects the merits of the question between the parties by determining
some right or liability and such a decision might be either final or
preliminary or interlocutory. The question as to when an order is -a judgment
once again arose, in the State of Uttar Pradesh v. Dr. Vijay Anand Maharaj(2).
The question was whether an order passed by a single Judge of a High Court
dismissing an application for a review of his earlier order was a judgment
amenable to a Letters Patent appeal. The question arose in the following
manner. The Additional Collector, Benaras' assessed the respondent to an
agricultural income tax under powers conferred on him Under the U.P.
Agricultural Income-tax Act, 1949. The respondent filed a writ petition in the
High Court for quashing the said order on the ground of want of jurisdiction in
the assessing officer. The writ petition was allowed and the assessment was
quashed. As the State did not file any appeal against the said order, the order
became .final. In 1956, the State promulgated Ordinance No. II of 1956 which
was, subsequently replaced by U.P. Act XIV of 1956. Under the Ordinance as also
under the Act, the assessments made by the Additional Collector were
Also, a right was conferred upon any party to
the proceedings under the U.P. Agricultural Income-tax Act, 1949 wherein
assessment was set aside on the ground of want of jurisdiction to apply for a
review of the said proceedings in the light of the provisions of the Ordinance
and the Act.
Further, a statutory injunction was imposed
upon the court to review such orders accordingly. Pursuant to the said
provisions, the appellant-&ate applied to the High Court at Allahabad for
review of the said order. The application was dismissed on the ground that
neither the Ordinance nor the Act entitled the appellant to a review of an
order passed in a writ petition under Aft, (1) 8 Beng. L. R. 433.
(1) (1963) (1) S. C. R. 1.
788 226." The appellant filed a Special
appeal under Ch. VIII, r. 5 of the Rules of the High Court against the said
That was dismissed inter alia on the ground
that the said order of the single Judge was not a 'judgment'. On appeal, this
Court, after referring to the aforesaid cleavage of opinion amongst the High Courtís
on the meaning of the term 'judgment, held that the order dismissing the
application for review in any event fell within the narrower meaning given to
it by the Calcutta High Court, and that therefore, the impugned order was a
'judgment' within the meaning of cl. 10 of the Letters Patent of the Allahabad
This Court held that the said Ordinance and
the Act conferred a fresh right upon a party to the earlier proceedings to have
the previous order set aside and to have a decision from the Court on the basis
'of the amended Act, that this was a valuable and a substantive right conferred
upon a party to the proceedings and that on the rival contentions the question
of the fresh right conferred upon a party to the proceedings and the
jurisdiction of the court to enforce the said right would be in issue and any
decision thereon -could legitimately be said to be a decision determining the
rights of parties. It also ,observed that the 'decision of the learned single
Judge dismissing the writ petition was certainly a decision denying the right
of the appellants alleged to have been conferred under the amending Act, and
therefore,, the order dismissing the writ petition was a 'judgment' within the
meaning of cl. 10 of the Letters Patent as also r. 5 of Ch. VIII of the Rules
of the High Court, and therefore, the Division Bench of the High Court erred in
holding that no appeal Jay against the said order.
In Begum Aftab Zamwi v. Lal Chand Khanna('),
the High ,Court of Delhi also has held that the expression 'judgment' in cl.
10 of the Letters Patent of the Lahore
High-Court not only meant a judgment having the effect of a decree, but any
order which affected the merits of a controversy between the parties by
determining some disputed right or liability.
In Shankarlal Aggarwal v. Shankarlal Poddae(2
) the question was whether an order passed by a single Judge of the High Court
confirming an auction sale during the winding up proceedings of the company was
appealable. Since the Court heard that such an order ,was appealable under s.
202 of the Indian Companies Act, 1913, it did not go in to the question whether
it was a 'judgment' within the meaning of cl. 15 of the Letters Patent. The,
decision, therefore, does not help. Similarly, Mohan Lal Magan Lal Thacker v.
Gujarat(1) and Tarapora & Co. v. M/s V/O Tractors Export, Moscow(') also
are strictly not relevant as they were decisions on (1) I. L. R.  Delhi
34 (F. B.) (3)  2 S.C.R. 685.
(2)  (1) S. C. R. 717.
(4)  (2) S. C. R. 699.
789 the meaning of the expression 'final
order' in Arts. 133 and 134(1) (c) of the Constitution and not on the
interpretation of the,, term judgment' in the Letters Patent of the High
There can be no doubt that an application
under 0. XXI, r. 90 to set aside an auction sale concerns the rights of a
person declared to be the purchaser.' If the application is allowed, the sale
is set aside and the purchaser is deprived of-his right to have the sale
confirmed. by the Court under r. 92. Such a right is a valuable right, in that,
upon such confirmation the sale becomes absolute, and the rights of ownership
in the property so sold become vested in him. A decision 'in such a proceeding,
therefore, must be said to be one determining the right of the auction
purchaser to have the sale confirmed and made absolute and of the judgment-debtor,
conferred by r. 90 to have it set aside and a resale ordered. In our view an
order in a proceeding under 0. XXI, r. 90 is a 'judgment' inasmuch as such a
proceeding raises a controversy between the parties therein affecting their
valuable rights and the, order allowing the application certainly deprives the
purchaser of rights accrued to him as a result of the auction-sale. We,
therefore, agree with the high Court that a Letters Patent appeal lay against
the order of the learned single Judge.
Rule 90 of 0. XXI of the Code, as amended by
the Allahabad High Court, inter alia provides that -no sale shall be set aside
on the ground of irregularity or even fraud unless upon the facts proved the
Court is satisfied that the applicant has sustained injury by reason of such
irregularity or fraud. Mere proof of a material iffegularity such as the one
under r.. 69 and inadequacy of price realised in such a sale, in other words
injury, is therefore, not sufficient. What has to be established is that there
was not only inadequacy of the price but that that inadequacy was caused by
reason of the material irregularity or fraud. A connection has thus to be
established between the inadequacy of the price and the material irregularity.
The learned single Judge found that the
appellant had been prejudiced inasmuch as the said sale realised only Rs. 8,000/though
the value of the appellant's share was Rs. 20,000/-. This view was founded upon
a report made by the Amin of the Execution Court in which that officer had valued
the said share at Rs. 20,000/-. The Division Bench, however, held, and in our
view rightly, that the learned single Judge was in error in relying upon that
report. The record clearly shows that no notice was given to the respondent of
the appellantís application to have a commissioner appointed to value the
property. The trial Court appointed the Amin as com. missioner without any such
notice and behind the back of the respondent. The Amin made his valuation
without giving an opportunity to the respondent to be heard. No opportunity was
ever given to the respondent to raise any objection to-the said valuation. The
790 report was filed in the trial court without any notice to the respondent.
Indeed, no reference was made to the report in the trial court so that the
trial court could not give any chance to the respondent to raise any contention
against it. It was for the first time brought out before the learned single
Judge who accepted it and held on the strength of it that the price realised at
the sale was grossly inadequate. In these circumstances the Division Bench
rightly held that the learned single Judge erred in relying on such a report.
Barring the report no evidence whatsoever was
led by the appellant to show that his share in the said property was worth Rs.
20,000/-, and that therefore the price realised at the auction was inadequate.
The Division Bench was, in our view, right in holding that the appellant had
failed to 'show inadequacy of the price or that such inadequacy was occasioned
by the said material irregularity.
When it was realised that the contention as
to the inadequacy of price cannot be sustained, counsel tried to argue that the
said sale fetched Rs. 8,000/only as the proclamation for sale had set out the
value of the appellant's share at that amount only. No such grievance was made
before the trial court, nor was such a grievance incorporated in the memorandum
of appeal before the High Court. Also, no such ground has been taken in the
special leave petition before this Court. Obviously, the appellant could not
raise such a contention before the High Court, much less before this Court.
Thus, the contentions raised by counsel for
the appellant fail and consequently the appeal is dismissed with costs.
R.K.P.S. Appeal dismissed.