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Report No. 89

42.31. Insolvency proceedin.-applicability.- A question arose in the past as to the applicability of this article to an application to set aside a sale in insolvency proceedings. The Judicial Commissioner, Nagpur,1 held that the provisions of Order 21, Code of Civil Procedure, 1908 (Execution), were applicable to insolvency proceedings and the period of limitation applicable to a petition for setting aside a sale in insolvency proceedings must be thirty days under Article 166 of the Limitation Act of 1908 (present Article 127).

But the Chief Court of Punjab took a contrary view,2 and held that Article 166 (Act of 1908) was not applicable to such an application, as it was not an application to set aside a sale in "execution of a decree" and that an application to set aside a sale that had been conducted by the court in realising the assets of the insolvent was governed by Article 181 of the Limitation Act, 1908. These two are comparatively old cases, and since then, the controversy does not appear to have come on the surface during the last fifty years. Hence no explanatory amendment on this count appears to be needed.

1. Balaji v. Gopal Mali, AIR 1927 Nag 262.

2. Afzal Ali v. Aman Ali, AIR 1914 Lah 209.

42.32. Parties to the applicati.-joinder of.- Another controversy is concerned with the joinder of parties in an application under Order 21, rule 92, C.P.C. The Patna High Court has held1 that the auction-purchaser is a necessary party to an application under Order 21, rule 92, to set aside an execution sale and where he is not made a party within the time allowed, the application cannot be entertained.

A contrary view has been taken by Rajasthan High Court, holding2 that it is not necessary to mention the name of the party in the heading of the application and if any party is left out, it is the duty of the Court to give notice under the proviso to Order 21, rule 92(2), C.P.C. and the application would not be barred by limitation. Since the passing of the Limitation Act in 1963, this article has not given rise to any controversy and the above solitary conflict need not detain us.

1. Sumitra Kaur v. Damri Lall, AIR 1921 Pat 498.

2. Alladin v. Karimbux, AIR 1955 Raj 51.

42.33. Fra.-antecedent or subsequent.- Then, there is the question of fraud, be antecedent and subsequent. In one case,1 the Kerala High Court has observed that on principle, if the fraud antecedent to the sale was of such a nature as to suffice for the requirements of section 18 (Limitation Act, 1908), such fraud could not be dismissed from consideration as having had its origin earlier. However, the Patna High Court2 has held that the petitioner must satisfy the court that he had been kept from the knowledge of his right to file an application and that his right to set aside the sale occurred after the sale.

The Court further observed that fraud perpetrated by the opposite party must be a fraud committed after the sale, and not a fraud committed in bringing about the sale. In this context, section 17 of the Limitation Act, 1963 does not differentiate between antecedent fraud and subsequent fraud. The limitation runs from the time the applicant has discovered the fraud or could, with reasonable diligence, have discovered it. In the absence of further case law on the point, we would leave the matter at that.

1. Malhan Simon v. Ouseph looka, AIR 1964 Ker 88 (89, 90), para. 3.

2. Jagdhar Missir v. Dharai Khntwa, AIR 1920 Pat 725.

42.34. Effect of fraud of decree holder or auction-purchaser alone.- A question has arisen whether the fraud of the decree-holder alone or of the auction-purchaser alone would be sufficient to extend the period of limitation. The Mysore High Court holds1 that section 18 (of the Act of 1908), could be attracted where the fraud in question was practised either by the decree-holder or by the auction-purchaser.

In a Calcutta case,2 it was held that a judgment debtor was not entitled to the benefit of section 18 for the purpose of making an application under Order 21, rule 90, C.P.C. to set aside an execution sale, if the decree-holder was not a party to the fraud alleged. In an Allahabad Full Bench case3, the view taken is that fraud of the decree-holder suffices and that it is immaterial whether the decree-holder alone is guilty of the fraud, or whether the auction purchaser was also a party to the fraud.

K.S. Hegde, J. (in the Mysore case4 referred to above) has taken stock of the judicial opinion on the subject and concluded as unde.-

"Both on principle and on preponderance of judicial authority, it appears to me that the correct view is that section 28 of the Limitation Act (of 1908) is applicable where the fraud in question is practised either by the decree-holder or by the auction-purchaser."

The controversy really appertains to section 17 of the present Act. Much may depend on the manner in which the parties are arrayed and other relevant facts. In view of this, we do not recommend any amendment on this point.

1. D. Veerappa v. Bangarappa, AIR 1960 Mys 297.

2. Azizunnessa v. Dwarika Prasad, AIR 1925 Cal 1227 (1228).

3. Balkesha Kunwar (Mt.) v. Harakh Chand, AIR 1934 All 255 (258): ILR 56 All 613 (FB).

4. D. Veerappa v. Bangarappa, AIR 1960 Mys 297 (299): ILR 1960 Mys 324.

42.35.Recommendation as to Order 21, rule 92(2), C.P.C.- However, we should refer to a connected provision in the Code of Civil Procedure, 1908, which seems to need amendment. Article 127 of the Limitation Act is concerned with applications, in regard to which Order 21, rule 92(2) of the Code is relevant. The period of limitation for an application under Article 127 is sixty days, after its amendment1 in 1976. The application is to be accompanied by a deposit.

The period for making the required deposit under Order 21, rule 92, C.P.C. is, however, still thirty days. This disharmony between the two statutory provisions should be removed. We may point out that the disharmony has been adverted to in a recent judgment of the Kerala High Court2 also. To remove this discrepancy, we recommend that Order 21, rule 92(2) of the Code of Civil Procedure, 1908, should be suitably amended by increasing the period from 30 days to 60 days3.

1. Section 98, Code of Civil Procedure (Amendment) Act, 1976.

2. Dakshayini v. Madhavan, AIR 1982 Ker 126 (June).

3. To be carried out under Order 21, rule 92(2), Code of Civil Procedure, 1908.

42.36.Article 128.- We now turn to Article 128, which reads as unde.-

"For possession by one dispossessed by immovable property and disputing the right of the decree holder or purchaser at a sale in execution of a decree.

Thirty days.

The date of the dispossession."

Article 165 of the Act of 1908 read as unde.-

"Under the code of Civil Procedure, 1908 by a person dispossessed of immovable property and disputing the right of the decree-holder or purchaser at a sale in execution of a decree to be put into possession.

Thirty days.

The date of the dispossession."

In the Act of 1877, Article 165 was in identical terms. In the Act of 1871 also, Article 158 was in identical terms.

42.37.No change recommended.- Certain controversies on this article have ceased to be relevant after the 1976 amendment of the Code of Civil Procedure, 1908, Order 21, rule 100. In view of this position, we do not see any reason to recommend any change in the article.

42.38. Article 129 reads as unde.-

"For possession after removing resistance or obstruction to delivery or possession of immovable property decreed or sold in execution of a decree.

Thirty days.

The date of resistance or obstruction."

In the Act of 1908, Article 167 read as unde.-

"Complaining of resistance or obstruction to delivery of possession of immovable property decreed or sold in execution of a decree.

Thirty days.

The date of the resistance or obstruction."

In the Act of 1878, Article 167 read as unde.-

"Complaining of resistance or obstruction to delivery of possession of immovable property decreed or sod in execution of a decree, or of possession in the delivery of possession to the decree holder or the purchaser of such property.

Thirty days.

The date of the resistance or dispossession."

In the Act of 1871, Article 160 read as under:

"Complaining of resistance or obstruction to delivery of possession of immovable property sold in execution of a decree, or of dispossession in the delivery of possession to the purchaser of such property.

Thirty days.

The date of the resistance or dispossession."

42.39.Starting point of limitation.- There is some debate in the case law about the starting point in regard to fresh obstructions. The Madras High Court has held that an application1 for the removal of a second obstruction, made mere than thirty days after acquiescence in a previous obstruction, was not barred by Article 167 (of the Act of 1908) and such acquiescence did not deprive the person entitled to possession of any further right to obtain execution.

The Calcutta High Court held2 that the auction-purchaser was not limited to one application under Order 12, rule 95, C.P.C. and the period of 30 days prescribed by Article 167 (Act of 1908) was to be counted from the date of the resistance or obstruction in respect of which the complaint was made. However, the Bombay High Court has held3 that the time limit for a subsequent application in respect of an obstruction by the same person would count from the earlier obstruction.

1. Mayappan Chetty v. Mayappan Servai, AIR 1921 Mad 559 (561).

2. Burma Sundari Devi v. Kiranshashi Chodhaurani, AIR 1938 Cal 352; cf. AIR 1959 Cal 613 (615) and Kedar v. Baijnuth, AIR 1939 Cal 494.

3. Mukand Balm v. Tanu Sabbu, AIR 1933 Born 457 (FB).

42.40. The Bombay view has been expressly dissented from in a Gujarat case,1 on the ground that though the Bombay ruling was a Full Bench decision the observations in that ruling were obiter. The Gujarat High Court held that since the law allows the decree-holder to make a second application for execution and to complain about the obstruction within 30 days from the date of resistance or obstruction, it was immaterial whether the decree-holder came, or failed to come, to court within 30 days of the date of the first obstruction. In view of the fact that the observations in the Bombay case were obiter, we make no recommendation regarding any change therein.

1. Maneklal v. Ochhavlal, AIR 1970 Guj 49 (50): 10 Guj LR 654.



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