Public auction requirement under partition law cannot be replaced by sealed offers; invalid sale and no restitution against co-owners.

A sale directed under the Partition Act and the Code must comply with the statutory requirement of public auction; an offer-based or tender-like process through newspaper advertisement is not its legal equivalent and is void for non-compliance. A co-owner cannot claim a Section 3 pre-emption right after a compromise decree has already directed sale of the undivided house, unless that right was reserved in the decree. Restitution or interest cannot be fastened on co-owners who never received the sale proceeds. The impugned confirmation of sale was therefore set aside and the matter was directed to proceed afresh.

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Issues: (i) Whether the sale of an undivided house by inviting sealed offers through newspaper advertisement, instead of by public auction, satisfied the requirement of sale by public auction under the Code and the Partition Act. (ii) Whether the co-owner could invoke Section 3 of the Partition Act to purchase the property at the highest offer after the compromise decree and sale process had been set in motion. (iii) Whether the highest bidder, whose deposit remained blocked after the sale was set aside, was entitled to interest on equitable principles or restitution.

Issue (i): Whether the sale of an undivided house by inviting sealed offers through newspaper advertisement, instead of by public auction, satisfied the requirement of sale by public auction under the Code and the Partition Act.

Analysis: The governing scheme required a sale under Section 2 of the Partition Act to be carried out in the manner prescribed by the Code, and Rule 65 of Order 21 mandated sale by public auction. Public auction, in its legal sense, involves open competition and the opportunity for bidders to raise bids on the spot. A process of calling for offers by advertisement is materially different from a public auction because the competing bidders do not bid in each other's presence and there is no open competition. Since the Commissioner adopted a tender-like procedure instead of the directed public auction, the statutory requirement was not met.

Conclusion: The sale was not a valid public auction and was a nullity.

Issue (ii): Whether the co-owner could invoke Section 3 of the Partition Act to purchase the property at the highest offer after the compromise decree and sale process had been set in motion.

Analysis: The compromise decree had already recorded the agreement that the house, being incapable of division, was to be sold and the proceeds divided. No liberty to any co-owner to pre-emptively purchase the property was reserved in the compromise terms. In those circumstances, the court was bound by the decree and the co-owner could not, at the stage of confirmation of sale, claim a right under Section 3 to buy the property at the highest offer merely because the highest bid had emerged in the course of the attempted sale.

Conclusion: The co-owner had no enforceable right under Section 3 to purchase the property in the facts of the case.

Issue (iii): Whether the highest bidder, whose deposit remained blocked after the sale was set aside, was entitled to interest on equitable principles or restitution.

Analysis: Restitution under Section 144 applies where a party has received a benefit that must be restored; here, the co-owners had not received the purchase money. Order 21 Rule 93 applies to sales set aside under the specific sale-setting-aside provisions of Order 21, whereas the present sale was treated as a nullity and was therefore outside that rule. Although the court could consider equitable relief under its inherent power, no equity arose against the successful co-owners because they derived no benefit from the deposit and were not shown to have caused the bidder's loss.

Conclusion: The bidder was not entitled to interest from the co-owners on the facts of the case.

Final Conclusion: The impugned confirmation of sale was set aside, the sale process was held invalid for not complying with the requirement of public auction, and the matter was directed to proceed afresh in accordance with the Code.

Ratio Decidendi: Where a statute or order requires sale by public auction, a tender or offer-based process is not its legal equivalent and is void for non-compliance; a co-owner's pre-emption claim must arise within the terms of the governing decree, and restitution cannot be fastened on a party who never received the sale proceeds.

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