Siviah Naidu Vs. State of A.P. & Anr  INSC 1523 (28 November 1996)
O R D
appellant is the auction-purchaser of 5.86 acres in Peddayyasamudram village in
Village District. The said land was brought to sale on November 2, 1967 to realise the debt due to the
Govt. from one K. Sankaraiah, the brother of K. Radhakrishaniah, the
respondent-plaintiff. The appellant had purchase the same in the said auction.
He was granted the sale certificate on April 31, 1969 under Ex-8-1. Later, the second
respondent, Radhakrishaniah filed the suit for setting aside the sale. The
trial Court dismissed the suit.
appeal, the District Judge confirmed the same. In Second Appeal No.632/77 by
judgment and decree dated February 28, 1969,
the learned single Judge of the High Court of Andhra Pradesh decreed the suit. Thus,
this appeal by special leave.
admitted facts are that K. Sankaraiah, the debtor and the second respondent are
members of the joint family.
partition dated July
26, 1954 under
Ex.B-13, Radhakrishaniah was granted a greater share since he had undertaken to
discharge all the liabilities on the joint family properties including the debt
contracted by Sankaraiah from the Government under a mortgage. The contention
raised by the second respondent, which was found acceptable by the High Court,
was that since he was not a defaulter within the meaning of Section 5 of the
A.P. Revenue Recovery Act, 1894 (for short, the `Act'), the property belonging
to the respondent could not be brought to sale. In support thereof, the learned
Judge has relied upon another judgment of that Court in Chatrati Srirama Murthi
& Ors. vs. Official Receiver Krishna & Ors. [(1957) 1 AWR 216]. The
question is; whether the view taken by the High Court is correct in law? The
learned District Judge recorded a finding, which was also accepted by the High
Court, that the properties are joint family properties hypothecated to the
Government for securing the loan by Sankaraiah. The second respondent under
Ex.B-13 had taken bulk of the properties including the suit schedule property
allotted to him in the partition with an undertaking "to discharge all the
liabilities of the erstwhile joint family including the loan obtained from the Government".
Thus, the question arises: whether the second respondent is a defaulter within
the meaning of Section 5 of the Act? Section 5 reads as under:
revenue may be in arrear it shall be lawful for the Collector or other officer
empowered by the Collector in that behalf, to proceed to recover the arrear,
together with interest and cost of process by the sale of dafaulter's movable
and immovable property, or by execution against the person of the defaulter in
manner hereinafter provided." It is to remember that the word `defaulter'
connotes the person who is liable to discharge the debt. In view of the fact
that the joint family property was hypothecated to the Government for recovery
of the debt taken by K. Sankaraiah and the second respondent had undertaken to
redeem the debt taken by Sankaraiah and the partition was subject to the above
undertaking, the property is liable to be proceeded for recovery of the debt
contracted upon it. As a consequence, the second respondent is a defaulter for
the purpose of Section 5 of the Act.
A. Subba Rao, learned counsel appearing for the second respondent, contended
that the word `defaulter' would be understood to be the person who has incurred
the liability. Though Radhakrishaniah, had undertaken the liability under
Ex.B-13, for the purpose of Section 5, he cannot be considered to be a
defaulter, but R. Sankaraiah was the defaulter; therefore, the property had by
the respondent at a partition is not liable to sell. In support thereof,
learned counsel placed reliance on the judgment of Madras High Court in C. Dhanalakshmi
Ammal vs. Income-Tax Officer, Madras [31 ITR 460]. The facts therein are that
the husband of the petitioner therein was the defaulter of arrears of
income-tax. The property belonged to his wife who was sought to be proceeded
against for recovery of arrears of income-tax due by the assessee, on the
premise that the wife is only a benamidar and the real owner of the property
was the husband, the defaulter. The Madras High Court had held that since the
husband is the defaulter, the property cannot be straightaway proceeded with
since they stand in the name of the wife, unless appropriate steps are taken to
ensure first that the wife is only a benamidar and the real owner of the
property is the husband. We need not consider the correctness of the view taken
by the Madras High Court for the reason that the facts therein are entirely
different from the facts in this case.
seen that the property which is proceeded with for recovery of the debt due to
the Government is the joint family property charged to the debt due by Sankaraiah.
The respondent-Radhakrishaniah had undertaken to discharge the liability under
Ex.B-13. Therefore, he assumed the responsibility as a defaulter under Section
5. In consequence, the property is liable to be proceeded with since he had not
discharged that liability. The sale conducted on November 2, 1967, therefore, is in accordance with the provisions of the
Act. The sale certificate was legal and valid. Accordingly, Ex. B-1, the sale
certificate dated April
31, 1961 binds, the
appeal is accordingly allowed. The judgments and decree of the High Court stand
set aside. The suit stands dismissed. No costs.