TaxTMI 
TaxTMI 
2008 (3) TMI 739
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....lare the sale being subject to the claim in Original Suit being OS No. 31 of 2000. The following facts will highlight the controversy. 3. Second Respondent herein, namely, Mattaparthi Satyam owned 14 acres of land. He put up the said land for sale and the present appellant having offered highest market value of Rs. 29,000/- per acre, executed an Agreement of Sale for 14 acres in favour of the appellant on 20th March, 1993 after having received a sum of Rs. 1 lakh from the appellant. The appellant thereafter paid Rs. 2 lakhs on 27.3.1993 and Rs. 20,000/- on 16.4.1993 which payments were endorsed on the reverse side of the Agreement by the Second Respondent. However, the Second Respondent failed to execute the registered Sale Deed inspite of several requests and, therefore, the present appellant filed Original Suit No. 605 of 1996 before the Subordinate Judge, Pondicherry for specific performance of the Sale Agreement which suit was later on transferred to Sub Court, Yanam and was renumbered as Original Suit No. 31 of 2000. The said suit is still pending. 4. In the year 2000, the first respondent, who is none else but the wife of the second respondent filed a maintenance case b....
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....e time when the objection is raised). These concurrent orders are now in challenge before us. 5. Shri Narasimha, learned counsel appearing on behalf of the appellant took us through the orders and contended that the view expressed by both the courts below to the effect that the Execution Application is not tenable is patently incorrect. As against this Shri Vishwanathan, learned counsel appearing on behalf of the first respondent and Shri Chandrachud, learned counsel appearing on behalf of the third respondent supported the order contending that in the wake of the completed auction under Order XXI Rule 58, the High Court and the Trial Court were justified in holding that the appellant's claim was not tenable at all. It is, therefore, to be seen as to whether the appellant's claim is tenable at all. 6. Learned counsel for the appellant took us through both the orders and firstly pointed out that the suit by the appellant being OS No. 605/96 before Sub Court, Pondicherry which was later on transferred to Sub Court, Yanam and re-numbered as OS No. 31 of 2000 was prior in point of time. From that suit it is clear that the first respondent was the wife of the second respon....
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.... first and the second respondent and her rights of maintenance are independent of any said suit which had arisen 18 years ago when her marriage was solemnized with the second respondent. Our attention was drawn even to the counter filed by the second respondent before the Trial Court where the second respondent had denied the Agreement. It was alleged by him that the Agreement set up by the appellant was only by way of security as the appellant had advanced a sum of Rs. 1 lakh to be paid to Mattaparthi Syamala and others on behalf of the second respondent. It was pointed out that the second respondent had flatly denied any such Agreement to Sell. Learned counsel, therefore, urged that the courts below were right in holding the application, filed by the appellant, to be not tenable particularly in view of the completed auction under Order XXI Rule 58. 8. Even the learned counsel appearing on behalf of third respondent urged that he was a bona fide purchaser of the auction held on 2.7.2003 and he was the highest bidder and that he did not know about OS No. 31 of 2000 filed by the appellant. It was his contention that in fact the appellant, in collusion with the second respondent, ....
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....58 CPC. The objector was none else but the son of the Judgment-Debtor whose property was auctioned. The objection was that since there was a prior lease in respect of the said property and since in pursuance of that lease the objector-appellant had been in possession of the same and, therefore, the attachment was not valid and has to be vacated. An objection was also raised that the properties which were attached were already sold and, therefore, the objection to the attachment and the appeal had become infructuous. The Court, therefore, dealt with the effect of the court sale conducted by the lower court. It was an admitted position that before the said order of High Court reached the sale was already completed in respect of all the items where the Decree-holder himself purchased the properties. It is also seen from the facts that there the sale was not confirmed. The Division Bench, speaking through Hon'ble Jagannadha Rao, J. (as His Lordship then was) observed in para 15: Whenever a claim is preferred under Order 21 Rule 58 CPC against attachment of immovable properties, the fact that the properties are sold or the sale confirmed will not deprive the co....
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.... maintainable. Considering the law laid down in Magunta Mining's case (supra) it must be said that mere holding of the auction does not bar the objections thereto. It is our considered opinion that in this case the sale was not confirmed and that made substantial difference. The word "sold" in Clause (a) of the proviso to Rule 58 has to be read meaning thereby a complete sale including the confirmation of the auction. That not having taken place, it cannot be said that the objection by the appellant was not ill- founded or untenable as has been held by the High Court and the Trial Court. 11. However, a contrary view has been taken by the Patna High Court in a reported decision in Kewal Singh v. Umesh Mishra AIR1983Pat303 where the Division Bench of the Patna High Court held that the term "sold" used in proviso (a) means the stage when the property is auctioned by the court and the bid is accepted by the court. The term does not refer to the stage of confirmation of the sale when it is made absolute under Rule 92. The learned Judge who was considering the interpretation of the proviso, after clearing some factual grounds, discussed the issue in para 7 of the judgment. In comi....
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....ceeded to hold ultimately that: I am of the view that the term 'property has been already sold' used in the proviso to Clause (1) of Rule 58 refers to the stage when the sale had taken place and does not refer to the stage when the sale becomes absolute. Learned counsel for the respondent very heavily relied on this judgment and pointed out that the decision in M/s. Magunta Mining Co's case (supra) the court had not considered the impact of Section 65 CPC. It will, therefore, be our task to decide the correctness or otherwise of both the judgments. 12. Reverting back to the judgment of Andhra Pradesh High Court in M/s. Magunta Mining Co's case, it will be seen that in para 14 of its judgment, the learned Judge considered the impact of Order XXI Rule 59. The learned Judge held: The provisions of Order 21 Rule 59 CPC show that where before a claim is preferred or objection made, and the property attached had already been advertised for sale, the court may, if the property is immovable, make an order, that pending the adjudication of the claim or objection the property shall not be sold, or that pending such adjudicatio....
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....arding the objector in the property and the fact that even if the sale is effected under Rule 58, it cannot obliterate the claims of the objectors which were created prior to the sale. This very situation with regard to impact of the prior interest in the shape of Agreement of Sale was taken into consideration in the subsequent judgment of Vannarakkal Kallalthil Sreedharan (cited supra) wherein the judgments of the Bombay High Court and the Travancore-Cochin High Courts were approved. Thus in considering the "time factor" of challenging the sale, the judgment also considers the "locus standi factor" on account of any prior interest of the objector in the suit property. This situation is very conspicuously absent in the judgment of the Patna High Court which has merely chosen to go by the language of Section 65 CPC. We must hasten to add that even if under Section 65 CPC, the title "after the sale has been made absolute under Rule 92" relates back to the date of sale, it would still be subject to the earlier rights of the objector and his interest in the suit property. Therefore, in our opinion Section 65 would not, by itself, provide any guidance regarding the interpretation of the....
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....p; An attaching creditor can only attach the right, title and interest of his debtor at the date of the attachment and on principle, his attachment cannot confer upon him any higher right than the judgment-debtor had at the date of the attachment. If a person, having a contract of sale in his favour, has such pre-existing right the attachment could not be binding upon him. If the promise get a conveyance, after the attachment, in pursuance of his contract, he takes a good file inspite of the attachment. The observations would only highlight the importance of the Agreement of Sale which is prior in time of the attachment as also the unconfirmed sale. 16. Learned counsel also points out the observations of this Court in Desh Bandu Gupta v. N.L. Anand & Rajinder Singh (1994)1SCC131 in paragraph 5 which are to the following effect: The auction-purchaser gets a right only on confirmation of sale and till then his right is nebulous and has only right to consideration for confirmation of sale. If the sale is set aside, part from the auction-purchaser, the decree holder is affected since the realisation of his decree debt is put off and he would be obligated to ....