TaxTMI 
TaxTMI 
1996 (1) TMI 381
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....as per order on E.A. 389 of 1946. After purchase the suit property was given on lease by Mohammed Haji to one Raghavan Nair on 2.5.45. Raghavan Nair in turn sold his rights in the suit property to one Avyapoan who, in turn, sold his rights to one Raman Menon. Raman Menon sold his rights in the said property on 3.10.1950 in favour of the respondent, P.K. Abdulla. One of the members of the Tarwad challenged the ex-party decree in OS No. 397 of 1941 by filing an application under order IX, Rule 13 of the Civil Procedure Code. The trial court declined to get aside the ex-party decree. The order of the trial court was reversed by the appellate Court. Ultimately the High Court by its judgment and order dated 29.1.1958 set aside the ex-party decree. After the ex-party decree was set aside, proceedings by way of restitution were started by the first defendant and Karnavan of the Tarwod by filing E.P. 29 of 1959. All the properties which had been taken possession of by Mohammed Haji in execution of the ex-party decree and of which restitution was sought were set out in a schedule in the proceedings for restitution. Item No. 6 in E.P. 29 of 1959 was the suit property. E.P. 29 of 1959 had ....
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....ourt by its judgment and order dated 26th November, 1962 has dismissed the suit of Mohammed Haji for eviction and recovery of possession but has decreed the suit for arrears of rent and costs. It is, therefore, not in dispute that the appellant as the successor-in-interest of the original defendants in OS No.397 of 1941, is entitled to restitution in so far as it is permissible in law, in respect of the properties which were sold in execution of the ex party decree which was set aside. It is, however, contended by the respondent that he is a lessee from the decree-holder auction purchaser. The appellant cannot seek restitution of properties leased to him by the decree-holder auction purchaser. The lease in his favour is protected, he being a third party to the court proceedings and the auction sale. This contention has been upheld by the Kerala High Court and is challenged before us. Now, under Section 144 of the Civil Procedure Code where and insofar as a decree or an order is varied or reversed or is set aside, the court which passed the decree or order, shall, on the application of any party entitled to any benefit by way of restitution or otherwise, cause such restitution to b....
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....r of the decree-holder. It said that the principle of the doctrine of restitution is that on the reversal of a decree the law imposes an obligation on the party to the suit who received the benefit of the erroneous decree to make restitution to the other party for what he has lost. This obligation arises automatically on the reversal or modification of the decree and necessarily carries with it the right to restitution of all that has been done under the erroneous decree; and the court in making restitution is bound to restore the parties so far as they can be restored to the same position they were in at the time when the court by its erroneous action had displaced them. As far back as in 1888, however, a distinction was made between sales to decree-holders and Sales to outsider purchasers. In the case of Zain-UI-Abdin Khan v. Muhammad Asghar Ali Khan and Ors. (1888 ILR [X] Allahabad 166), the Privy Council held that there was a great distinction between the decree-holders who come in and purchase under their own decree which is afterwards reversed on appeal and the bona fide purchasers who come in and buy at the sale in execution of a decree to which they are not parties and at ....
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....on purchaser have bought from one whose title is liable to be defeated. The title acquired by the purchaser from the decree-holder is similarly defeasible. The Court further observed, "The defeasibility of a decree-holder's title where the decree is ex party is of such common occurrence that the plea of a purchaser for value without notice hardly applies". The same view has been reaffirmed by the Calcutta High Court in the case of Abdul Rahman v. Sarat Ali and Anr. (AIR 1916 Calcutta 710) where it has held that the assignee of a decree-holder auction purchaser stands in no better position than his assignor. The special protection afforded to a stranger who purchases at an execution sale is not extended to an assignee of the decree-holder auction purchaser. The distinction between a stranger who purchases at an auction sale and an assignee from a decree-holder purchaser at an auction sale is quite clear. Persons who purchase at a court auction who are strangers to the decree are afforded protection by the court because they are not in any way connected with the decree. Unless they are assured of title; the court auction would not fetch a good price and would be detrimental to ....
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....ngam Asari v. N.S. Krishna Iyer and Ors. (AIR 1964 Madras 404), and the cases cited therein as also by the Kerala High Court in the case of Parameswaran Pillai Kumara Pillai and Ors. v. Chinna Lakshmi and Anr. (1970 Ker.L.J. 458) is not the correct view. The High Court, therefore, was not right in protecting the lease created in favour of the respondent by Mohd. Haji who was a decree-holder auction purchaser at the sale in execution of the ex party decree which was subsequently set aside. The respondent, however, contends that although he was evicted in restitution proceedings, he can nevertheless maintain a suit on title because as a lessee he enjoyed certain protection under the land reform legislation in Kerala. The Kerala Land Reforms Act, 1964 was in operation at the time when he was evicted on 5.4.1966. Since the suit of the appellant was based on his title on the date when he was evicted, we need to examine the land reform legislation which applied to the tenants in 1966. It is, however, urged by the respondent that in 1966 when he was evicted, his rights under Section 43 of the Malabar Tenancy Act were protected. Section 43 provides that a cultivating tenant shall be entit....