The expression “legal proceeding” has been the subject
matter of consideration in the Federal Court decision in
Governor-General in Council v. Shiromani Sugar Mills Ltd.,
AIR 1946 FC 16. In that decision Section 171 of the Indian
Companies Act, 1913 came up for consideration. That Sectionmatter of consideration in the Federal Court decision in
Governor-General in Council v. Shiromani Sugar Mills Ltd.,
AIR 1946 FC 16. In that decision Section 171 of the Indian
reads as follows:
“When a winding-up order has been made or a
provisional liquidator has been appointed, no suit or
other legal proceeding shall be proceeded with or
commenced against the company except by leave
of the court, and subject to such terms as the court
may impose.”
16. The Federal Court held that the expression “other legal
proceedings” in Section 171 of the Indian Companies Act, 1913
comprises any proceeding initiated by the revenue for recovery
of tax dues under the Indian Income Tax Act. There is no
warrant for a narrow construction of such expression asmeaning ‘proceedings only in courts’. The Federal Court
specifically held that initiating and putting into force the
collection of arrears of income tax as arrears of land revenue by
authorities under the Income Tax Act would be a “legal
proceeding”.
17. In Binod Mills Co. Ltd. Ujjain (M.P.) v. Suresh Chandra
Mahaveer Prasad Mantri, Bombay, 1987 (3) SCC 99, this
Court had to construe Section 5 of the M.P. Sahayata Upkram
(Vishesh Upbandh) Adhiniyam, 1978. Section 5 of the said
Adhiniyam reads as follows:
“5. Suspension of suits or other legal
proceedings against relief undertakings.—As
from the date specified in the notification under
sub-section (1) of Section 3, no suit or other legal
proceeding shall be instituted or commenced or, if
pending, shall be proceeded with against the
industrial undertaking during the period in which it
remains a relief undertaking any law, usage,
custom, contract, instrument, decree, order, award,
settlement or other provisions whatsoever
notwithstanding.”
18. This Court referred in detail to the aforesaid Federal Court
decision, and further went on to hold that Section 5 would
include execution petitions that were filed to execute decrees
under the Code of Civil Procedure.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.8756 OF 2016
Ludovico Sagrado Goveia
V
Cirila Rosa Maria Pinto and Ors. .
Dated:September 6, 2016
Citation: 2016 SCCONLINESC906
1. The present appeal is filed by the successful purchaser at
an auction held in execution of an order dated 5.10.2000 of the
Assistant Registrar of Cooperative Societies passed under
Section 76 of the Multi State Cooperative Societies Act, 1984
[hereinafter referred to as “the 1984 Act”]. The brief facts of the
present appeal are as follows.
2. Respondent No. 3 in the High Court, as Proprietor of M/s
Gable Builders, obtained a loan of Rs. 40 lacs from the Mapusa
Branch of the Goa State Cooperative Bank Ltd. The said loan
was sanctioned for the purpose of construction of a Bungalow.
By a deed of mortgage executed on 2.12.1997, the said loan
was secured by mortgaging the western part of the scheduled
property admeasuring 8000 sq. mts. The principal borrower
failed to repay the loan installments. That being so, recovery
proceedings were initiated under Sections 74 and 76 of the said
Act by the Bank against respondent No. 3 and two sureties of
the said loan. The Assistant Registrar of Cooperative Societies,
by an Award dated 5.10.2000, noticed that despite being duly
served summons by Registered post A.D., all the three
opponents remained absent. As a result, an ex-parte award
was passed holding all the three opponents jointly and severally
liable to pay the loan dues amounting to Rs 55,04,583/- . It may
be mentioned that interest was payable at 21% compounded
under the said deed of mortgage dated 2.12.1997.
3. A demand notice dated 12.6.2001 was then issued by the
Bank under Rule 22 of the Multi State Co-operative Society
2Page 3
Rules, 1985 against all the three said persons for a principal
amount of Rs. 60,59,646/- together with further interest at 19%
per annum from 1.4.2001 till the date of payment.
4. In spite of receiving the said notice, the defaulters failed
to pay any amount towards bank dues, and the bank then
referred the said award for execution to the Sale and Recovery
Officer, Regional Office at Verem, Goa. The said Recovery
Officer issued a proclamation notice for sale by public auction of
the mortgaged property by publishing a notice dated 2.1.2002
which was duly published in the Daily Herald on 5.1.2002.
Nobody came forward in response to the said notice. Between
January 2002 and February 2007 several proclamation notices
were issued – six in all- to sell the said mortgaged property, but
no bidders came forward to purchase the said property. The
Bank then decided to sell the said mortgaged property by
adopting the mode of selling property by sealed tender.
Accordingly, the Sale and Recovery Officer issued a tender
notice dated 18.3.2007 calling for sealed tenders. The said
notice was published in a local newspaper “The Tarun Bhagat”
also of the same date. As per the said tender notice, sealed
quotations were invited from the public on or before 23.3.2007.
5. Two sealed tenders were received on 20.3.2007. A bid of
Rs. 86,00,000/- received from the appellant in the present
appeal was found to be the highest and accordingly, since the
appellant paid the entire bid amount of Rs. 86,00,000/-, a Sale
Certificate in favour of the appellant was issued on 23.4.2007.
6. Without availing of the procedure provided by Rule 37
(13) of the Multi State Co-operative Society Rules, 2002 by
which the defaulter/ borrower could approach the authorities
with an amount of 5% to be paid to the auction purchaser
together with the full amount of the outstanding loan and
expenses of attachment and sale to the decree holder, with
interest thereon, within 30 days of confirmation of sale. If this
were done, the said sale could have been set aside. Since the
borrower did not repay at any stage the money borrowed by
him, the borrower filed a Writ Petition being Writ Petition No.
325 of 2007 dated 21.6.2007 before the High Court of Bombay
at Goa to quash both the award and the certificate of sale
accorded in favour of the Appellant.
7. By the impugned judgment dated 23.12.2013, the High
Court has held that the Multi State Co-operative Societies Act,
1984 was repealed by the Multi State Co-operative Societies
Act, 2002, [hereinafter referred to as “the 2002 Act”] which Act
came into force on 19.8.2002. According to the High Court, the
new Act deems an award passed by the Assistant Registrar as
an award in an arbitration case, which is executable only under
the Arbitration and Conciliation Act, 1996 [hereinafter referred to
as “the 1996 Act”], and this being the case, the auction
proceedings were set aside by the High Court stating that the
award dated 5.10.2002 would be liable to be executed only in
the manner provided by the 1996 Act. It is the correctness of
this judgment that has to be inquired into in the present appeal.
8. Learned counsel for the appellants has placed the
relevant provisions of both the 1984 Act and 2002 Act, and has
relied in particular on Section 126(6) of the 2002 Act to contend
that all legal proceedings that had been initiated under the 1984
Act would continue under that Act. This being the case, it is
clear that as execution proceedings were initiated prior to 19th
August, 2002, which is the date of coming into force of the 2002
Act, the said proceedings would be saved despite repeal of the
1984 Act by the 2002 Act.
9. On the other hand, learned counsel appearing on behalf
of the respondent, argued that, under the 2002 Act, the 1996
Act alone would get attracted, and that, therefore, the High
Court judgment was correct. Learned counsel further argued
that even if the impugned judgment were to be set aside, other
points remained to be argued in the Writ Petition so that the
matter could then be remanded back to the High Court for
further consideration of these other points.
10. We have heard learned counsel for the parties. Before
dealing with the contentions raised before us it will be important
to set out some of the relevant statutory provisions.
“Multi-State Co-operative Societies Act, 1984
74. (1) Notwithstanding anything contained in any
other law for the time being in force, if any dispute
(other than a dispute regarding disciplinary action
taken by a multi-State co-operative society against
its paid employee or an industrial dispute as defined
in clause (k) of section 2 of the Industrial Disputes
Act, 1947) touching the constitution, management
or business of a multi-State co-operative society
arises-
(a) among members, past members and persons
claiming through members, past members and
deceased members, or
(b) between a member, past member or a person
claiming through a member, past member or
deceased member and the multi-State co-operative
society, its board or any officer, agent or employee
of the multi-State co-operative society or liquidator,
past or present , or
(c) between the multi-State co-operative society
or its board and any past board, any officer, agent
or employee, or any past officer, past agent or past
employee or the nominee, heirs or legal
representatives of any deceased officer, deceased
agent, or deceased employee of the multi-State
co-operative society, or
(d) between the multi-State co-operative society
and any other multi-State co-operative society,
between a multi-State co-operative society and
liquidator of another multi-State co-operative society
and the liquidator of another multi-State
co-operative society.
Such dispute shall be referred to the Central
Registrar for decision and no court shall have
jurisdiction to entertain any suit or other
proceedings in respect of such dispute :
Provided that all disputes in which a national
co-operative society is a party shall be referred to
the Central Registrar or any officer empowered to
exercise the powers of the Central Registrar.
(2) For the purposes of sub-section (1), the
following shall be deemed to be disputes touching
the constitution, management or business of a
multi-State co-operative society, namely :-
(a) a claim by the multi-State co-operative society
for any debt or demand due to it from a member or
the nominee, heirs or legal representatives of a
deceased member, whether such debt or demand
be admitted or not;
(b) a claim by a surety against the principal
debtor where the multi-State co-operative society
has recovered from the surety any amount in
respect of any debt or demand due to it from the
principal debtor as a result of the default of the
principal debtor, whether such debt or demand is
admitted or not;
(3) If any question arises whether a dispute
referred to the Central Registrar is or is not a
dispute touching the constitution, management or
business of a multi-State co-operative society, the
decision thereon of the Central Registrar shall be
final and shall not be called in question in any court.
76. Settlement of disputes.- (1) The Central
Registrar may, on receipt of the reference of dispute
under section 74,-
(a) elect to decide the dispute himself, or
(b) transfer it for disposal to any other person
who has been invested by the Central Government
with powers in that behalf.
(2) The Central Registrar may withdraw any
reference transferred under clause (b) of
sub-section (1) and decide it himself or refer the
same for decision to any other person who has
been invested by the Central Government with
powers in that behalf.
(3) The Central Registrar or any other person to
whom a dispute is referred for decision under this
section may, pending the decision of the dispute,
make such interlocutory orders as he may deem
necessary in the interest of justice.
85. Execution of decision, etc. – Every decision
or order made under section 30. Section 31, section
73, section 76, section 90, section 92 or section 93
shall, if not carried out.-
(a) on a certificate signed by the Central Registrar
or any person authorized by him in writing in this
behalf, be deemed to be a decree of a civil court
and shall be executed in the same manner as if it
were a decree of such court ; or
(b) where the decision or order provides for the
recovery of money, be executed according to the
law for the time being in force for the recovery of
arrears of land revenue :
Provided that any application for the recovery in
such manner of any sum shall be made –
(i) To the Collector and shall be accompanied by
a certificate signed by the Central Registrar or by
any person authorized by him in writing in this
behalf ;
(ii) Within twelve years from the date fixed in the
decision or order and if no such date is fixed, from
the date of the decision or order, as the case may
be; or
(c) be executed by the Central Registrar or any
person authorized by him in writing in this behalf, by
attachment sale or sale without attachment of any
property of the person or a multi-State co-operative
society against whom the decision or order has
been made.
Multi-State Co-operative Societies Act, 2002
84. Reference of disputes.- (1) Notwithstanding
anything contained in any other law for the time
being in force, if any dispute [other than a dispute
regarding disciplinary action taken by a multi-State
co-operative society against its paid employee or an
industrial dispute as defined in clause (k) of section
2 of the Industrial Disputes Act, 1947 (14 of 1947)]
touching the constitution, management or business
of a multi-State co-operative society arises-
(a) among members, past members and persons
claiming through members, past members and
deceased members, or
(b) between the member, past member and
persons claiming through a member, past member
or deceased member and the mutli-State
co-operative society, its board or any officer, agent
or employee of the mutli-State co-operative society
or liquidator, past or present, or
(c) between the multi-State co-operative society or
its board and any past board, any officer, agent or
employee, or any past officer, past agent or past
employee, heirs or legal representatives of any
deceased officer, deceased agent or deceased
employee of the multi-State co-operative society, or
(d) between the multi-State co-operative and any
other multi-State co-operative society, between a
multi-State co-operative society and liquidator of
another mutli-State co-operative society and the
liquidator of another multi-State co-operative
society.
Such dispute shall be referred to arbitration.
(2) For the purposes of sub-section (1), the
following shall be deemed to be disputes touching
the constitution, management or business of a
multi-State co-operative society, namely:-
(a) a claim by the multi-State co-operative society
for any debt or demand due to it from a member or
the nominee, heirs or legal representatives of a
deceased member, whether such debt or demand
be admitted or not;
(b) a claim by a surety against the principal debtor
where the multi-State co-operative society has
recovered from the surety any amount in respect of
any debt or demand due to it from the principal
debtor as a result of the default of the principal
debtor, whether such debt or demand is admitted or
not ;
(c) Any dispute arising in connection with the
election of any officer of a multi-State co-operative
society.
(3) If a question arises whether a dispute referred
to arbitration under this section is or is not a dispute
touching the constitution, management or business
of a multi-State co-operative society, the decision
thereon of the arbitrator shall be final and shall not
be called in question in any court.
(4) Where a dispute has been referred to
arbitration under sub-section (1), the same shall be
settled or decided by the arbitrator to be appointed
by the Central Registrar.
(5) Save as otherwise provided under this act, the
provisions of the Arbitration and Conciliation Act,
1996 (26 of 1996) shall apply to all arbitration under
this Act as if the proceedings for arbitration were
referred for settlement or decision under the
provisions of the Arbitration and Conciliation Act,
1996.
94. Execution of decisions, etc.- Every decision
or order made under section 39 or section 40 or
section 83 or section 99 or section 101 shall, if not
carried out,-
(a) on a certificate signed by the Central Registrar
or any person authorized by him in writing in this
behalf, be deemed to be a decree of a civil court
and shall be executed in the same manner as if it
were a decree of such court and such decree shall
be executed by the Central Registrar or any person
authorized by him in writing in this behalf, by
attachment and sale or sale without attachment of
any property of the person of the person or a
multi-State co-operative society against whom the
decision or order has been made; or
(b) where the decision or order provides for the
recovery of money, by executed according to law for
the time being in force for the recovery of arrears of
land revenue:
Provided that any application for the recovery
of any sum shall be made in such manner-
(i) To the Collector and shall be accompanied by a
certificate signed by the Central Registrar or by
any person authorized by him in writing in this
behalf;
(ii) Within twelve years from the date fixed in the
decision or order and if no such date is fixed,
from the date of decision or order, as the case
may be; or
(c) be executed by the Central Registrar or any
person authorized by him in writing in this behalf, by
attachment and sale or sale without attachment of
any property of the person or a multi-State
co-operative society against whom the decision or
order has been made.
126. Repeal and saving. (1) The Multi-State
Co-operative Societies Act, 1984 (51 of 1984) is
hereby repealed.
(2) Without prejudice to the provisions contained in
the General Clauses Act, 1897 (10 of 1897) with
respect to repeals, any notification, rule, order,
requirement, registration, certificate, notice,
decision, direction, approval, authorisation, consent,
application, request or thing made, issued, given or
done under the Multi-State Co-operative Societies
Act, 1984 (51 of 1984) shall, if in force at the
commencement of this Act, continue to be in force
and have effect as if made, issued, given or done
under the corresponding provisions of this Act.
(3) Every multi-State co-operative society, existing
immediately before the commencement of this Act
which has been registered under the Co-operative
Societies Act, 1912 (2 of 1912) or under any other
Act relating to co-operative societies in force, in a y
State or in pursuance of the provisions of the
Multi-unit Co-operative Societies Act, 1942 (6 of
1942) or the Multi-State Co-operative Societies Act,
1984 (51 of 1984), shall be deemed to be registered
under the corresponding provisions of this Act, and
the bye-laws of such society shall, in so far as they
are not inconsistent with the provisions of this Act,
or the rules, continue to be in force until altered or
rescinded.
(4) All appointments, rules and orders made, all
notifications and notices issued and all suits and
other proceedings instituted under any of the Acts
referred to in sub-section (1) shall, in so far as they
are not inconsistent with the provisions of this Act,
be deemed to have been respectively made, issued
and instituted under this Act, save that an order
made cancelling the registration of a multi-State
co-operative society shall be deemed, unless the
society has already been finally liquidated, to be an
order made under section 86 for its being wound up.
(5) The provisions of this Act shall apply to-
(a) any application for registration of a multi-State
co-operative society;
(b) any application for registration of amendment of
bye-laws of a multi-State co-operative society,
pending at the commencement of this Act and to the
proceedings consequent thereon and to any
registration granted in pursuance thereof.
(6) Save as otherwise provided in this Act, any legal
proceeding pending in any court or before the
Central Registrar or any other authority at the
commencement of this Act shall be continued to be
in that court or before the Central Registrar or that
authority as if this Act had not been passed.”
11. The first thing that can be noticed is that an adjudication
made under Section 74 and 76 of 1984 Act can be executed in
the manner provided by Section 85 of the 1984 Act. Every
decision or order made under Section 76 can be executed in
three ways. We are concerned with sub-clause (c), in particular,
inasmuch, as on the facts of the present case, the execution
application was made to attach and sell the property of the
persons against whom the said order has been made.
12. The scheme of the 2002 Act which replaces the 1984 Act
is a little different. Section 84 of the 2002 Act corresponds to
Section 74 and 76 of the 1984 Act. With this difference – that
disputes that have been referred to arbitration are now to be
settled or decided by the Arbitrator to be appointed by the
Central Registrar, and the provisions, therefore, of the 1996
Arbitration and Conciliation Act shall apply to such arbitration as
if the proceedings for arbitration were referred for settlement or
decision under the provisions of the said Act.
13. Thus it can be seen that Section 84 (4) and (5) of the new
Act provide for a different scheme. Equally, Section 94 which
provides for execution of certain decisions and orders made
under the 2002 Act, mentions various Sections, but Section 84
is conspicuous by its absence. This is obviously for the reason
that the entire proceedings have now to be conducted under
the 1996 Act, including execution of the arbitration Award made
under the said Act. The question before the High Court was
whether proceedings initiated under the old Act could continue
under the said Act.
14. For this, it is important to advert to Section 126(6), which
has been completely missed by the High Court. By this Section,
any legal proceeding pending before any authority at the
commencement of the 2002 Act shall be continued to be
before that authority as if the 2002 Act had not been passed.
15. The expression “legal proceeding” has been the subject
matter of consideration in the Federal Court decision in
Governor-General in Council v. Shiromani Sugar Mills Ltd.,
AIR 1946 FC 16. In that decision Section 171 of the Indian
Companies Act, 1913 came up for consideration. That Section
reads as follows:
“When a winding-up order has been made or a
provisional liquidator has been appointed, no suit or
other legal proceeding shall be proceeded with or
commenced against the company except by leave
of the court, and subject to such terms as the court
may impose.”
16. The Federal Court held that the expression “other legal
proceedings” in Section 171 of the Indian Companies Act, 1913
comprises any proceeding initiated by the revenue for recovery
of tax dues under the Indian Income Tax Act. There is no
warrant for a narrow construction of such expression as
meaning ‘proceedings only in courts’. The Federal Court
specifically held that initiating and putting into force the
collection of arrears of income tax as arrears of land revenue by
authorities under the Income Tax Act would be a “legal
proceeding”.
17. In Binod Mills Co. Ltd. Ujjain (M.P.) v. Suresh Chandra
Mahaveer Prasad Mantri, Bombay, 1987 (3) SCC 99, this
Court had to construe Section 5 of the M.P. Sahayata Upkram
(Vishesh Upbandh) Adhiniyam, 1978. Section 5 of the said
Adhiniyam reads as follows:
“5. Suspension of suits or other legal
proceedings against relief undertakings.—As
from the date specified in the notification under
sub-section (1) of Section 3, no suit or other legal
proceeding shall be instituted or commenced or, if
pending, shall be proceeded with against the
industrial undertaking during the period in which it
remains a relief undertaking any law, usage,
custom, contract, instrument, decree, order, award,
settlement or other provisions whatsoever
notwithstanding.”
18. This Court referred in detail to the aforesaid Federal Court
decision, and further went on to hold that Section 5 would
include execution petitions that were filed to execute decrees
under the Code of Civil Procedure.
19. It is thus clear that the proceeding in execution initiated
under Section 85(c) of 1984 Act and pending before the
authorities under the said Act prior to 19th August, 2002, would
continue unhindered by the repeal of the 1984 Act by the 2002
Act. This being the case, it is clear that the judgment under
appeal is incorrect, and would have to be set aside.
20. In the affidavit in reply filed by the bank to the Writ
Petition, the bank states that it has recovered the entire loan
due together with interest amounting to Rs.85,15,311.75 as
against Rs.86 lakhs received in the auction proceedings, and admits
that the balance amount of Rs. 74,688.25 over and above the loan
dues are payable to the appellant. This being the case, and in order
to do complete justice between the parties, it is ordered that the
amount of Rs.74,688.25, together with interest at the rate of 19
per cent compounded per annum with effect from 1st April,
2007, be paid by the bank to the appellants within a period of
four weeks from the date of pronouncement of this judgment.
21. Learned counsel for the respondent exhorted us to send
the matter back for a decision on grounds (V) and (VI) of the
Writ Petition which read as follows:
“(V) The Petitioner further submits that the said Sale
Certificate issued by Respondent no.2 pursuant to
the notice dated 17.3.2007 is also void being
passed under the colour of powers, in as much as
the Respondent no.2 could not give a go-bye to the
mandate of Rule 36 of the Multi-State Co-operative
Societies Rules and decided to hold the auction
and/ or open the tenders in a period short of 15
days, in as much as the said Rule does not provide
for relaxation. On the other hand, it mandates that
the notice shall be of a period of 15 days.
(VI) The entire action of the Respondent No. 2 is
malafide and meant to favour of the Respondent
No.3 in as much as facts stated above make it clear
that, that apart, the conduct of the Respondents in
not providing the certified copies of the
proceedings and keeping the Petitioner in the dark
when she is the owner of the property and
surreptitiously seeking to hold the auction giving a
go-bye to the statutory requirements makes it clear
that the Respondent No. 2 acted malafide with
respect and which act vitiates the entire
proceedings.”
22. We find that after six failed attempts to sell the property
we would not be inclined to accede to this request at this point
in time. We find, on the facts of this case, that at no stage were
the respondent – borrowers ready to pay back the entire money
borrowed by them as far back as in 1997. We also find that a
Writ Petition was filed in 2007 without attempting to set aside
the certificate of sale granted under either Rule 37(13) or (14)
of the Multi State Co-operative Society Rules, 20021
. It is of
1
(13) (a) Where immovable property has been sold by the Sale Officer, any person either owning such
property or holding an interest therein by virtue of a title acquired before such sale may apply to have the
sale set aside on his depositing with the recovery officer –
(i) for payment to the purchaser a sum equal to five per cent of the purchase money, and
(ii) for payment to the decree-holder, the amount of arrears specified in the proclamation of sale
as that for the recovery of which the sale was ordered together with interest thereon and the expenses of
attachment, if any, and sale and other costs due in respect of such amount, less amount which may since
the date of such proclamation have been received by the decree-holder.
(b) If such deposit and application are made within thirty days from the date of sale, the recovery
officer shall pass an order setting aside the sale and shall repay to the purchaser, the purchase money so
far as it has been deposited, together with five per cent deposited by the applicant: Provided that if more
than one person have made deposit and application under this sub-rule, the application of the first
depositor to the officer authorised to set aside the sale, shall be accepted.
(c) If a person applies under sub-rule (14) to set aside the sale of immovable property, he shall
not be entitled to make an application under this sub-rule.
(14) (i) At any time within thirty days from the date of sale of immovable property, the
decree-holder or any person entitled to share in a rate able distribution of the assets or whose interests
are effected by the sale, may apply to the recovery officer to set aside the sale on the ground of a material
irregularity or mistake or fraud in publishing or conducting it:
Provided that no sale shall be set aside on the ground of irregularity or fraud unless the
recovery officer is satisfied that the applicant has sustained substantial injury by reason of such
irregularity, mistake or fraud.
some significance that it is not the appellant’s case that the
property has been sold at an undervalue. Also, as has been
pointed out above, the opportunity to have the sale certificate
set aside under Rule 37(13) has not been availed. Ground V of
the Writ Petition is in reality a ground relatable to Rule 37(14),
as, according to the petitioner, there is a material irregularity in
conducting the sale. For the petitioner to make out such a
ground, he has first to apply to the recovery officer within 30
days from the date of sale. And further, the appellant has to
make out a case that he has sustained substantial injury by
reason of such irregularity. Ground V of the Writ Petition does
not even refer to substantial injury for the reason that is not the
(ii) If the application is allowed, the recovery officer, shall set aside the sale and may direct a fresh
one.
(iii) On the expiration of thirty days from the date of sale if no application to have the sale set
aside is made or if such application has been made and rejected, the recovery officer shall make an order
confirming the sale:
Provided that if he shall have reason to believe that the sale ought to be set aside
notwithstanding that no such application has been made or on grounds other than those alleged in any
application which has been made and rejected, he may, after recording his reasons in writing, set aside
the sale.
(iv) Whenever the sale of any immovable property is not so confirmed or is set aside, the deposit
or the purchase money, as the case may be, shall be returned to the purchaser.
(v) After the confirmation of any such sale, the recovery officer shall grant a certificate of sale
bearing his seal and signature to the purchaser, and such certificate shall state the property sold and the
name of the purchaser and it shall be conclusive evidence of the fact of the purchase in all courts and
tribunals, where it may be necessary to prove it and no proof of the seal or signature of the recovery
officer shall be necessary unless the authority before whom it is produced shall have reason to doubt its
genuineness.
(vi) An order made under this sub-rule shall be final, and shall not be liable to be questioned in
any suit or other legal proceedings.
appellant’s case that the property has been sold at a gross
undervalue. No relief can be given in the Writ Petition so as to
circumvent the statutory provisions contained in Rule 37(13)
and (14). Ground VI is totally vague and lacking in particulars.
A charge of malafides has to be made out with great clarity and
particularity. Also, the appellant cannot claim to be in the dark
as every auction sale was publicly advertised in newspapers.
We, therefore, do not accede to counsel’s fervent plea to remit
the rest of the Writ Petition to the High Court for hearing.
23. We therefore set aside the judgment under appeal as a
whole. There will not be any order as to costs.
..............................J.
(DIPAK MISRA)
..............................J.
(R.F. NARIMAN)
New Delhi;
September 6, 2016
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.8756 OF 2016
Ludovico Sagrado Goveia
V
Cirila Rosa Maria Pinto and Ors. .
Dated:September 6, 2016
Citation: 2016 SCCONLINESC906
1. The present appeal is filed by the successful purchaser at
an auction held in execution of an order dated 5.10.2000 of the
Assistant Registrar of Cooperative Societies passed under
Section 76 of the Multi State Cooperative Societies Act, 1984
[hereinafter referred to as “the 1984 Act”]. The brief facts of the
present appeal are as follows.
2. Respondent No. 3 in the High Court, as Proprietor of M/s
Gable Builders, obtained a loan of Rs. 40 lacs from the Mapusa
Branch of the Goa State Cooperative Bank Ltd. The said loan
was sanctioned for the purpose of construction of a Bungalow.
By a deed of mortgage executed on 2.12.1997, the said loan
was secured by mortgaging the western part of the scheduled
property admeasuring 8000 sq. mts. The principal borrower
failed to repay the loan installments. That being so, recovery
proceedings were initiated under Sections 74 and 76 of the said
Act by the Bank against respondent No. 3 and two sureties of
the said loan. The Assistant Registrar of Cooperative Societies,
by an Award dated 5.10.2000, noticed that despite being duly
served summons by Registered post A.D., all the three
opponents remained absent. As a result, an ex-parte award
was passed holding all the three opponents jointly and severally
liable to pay the loan dues amounting to Rs 55,04,583/- . It may
be mentioned that interest was payable at 21% compounded
under the said deed of mortgage dated 2.12.1997.
3. A demand notice dated 12.6.2001 was then issued by the
Bank under Rule 22 of the Multi State Co-operative Society
2Page 3
Rules, 1985 against all the three said persons for a principal
amount of Rs. 60,59,646/- together with further interest at 19%
per annum from 1.4.2001 till the date of payment.
4. In spite of receiving the said notice, the defaulters failed
to pay any amount towards bank dues, and the bank then
referred the said award for execution to the Sale and Recovery
Officer, Regional Office at Verem, Goa. The said Recovery
Officer issued a proclamation notice for sale by public auction of
the mortgaged property by publishing a notice dated 2.1.2002
which was duly published in the Daily Herald on 5.1.2002.
Nobody came forward in response to the said notice. Between
January 2002 and February 2007 several proclamation notices
were issued – six in all- to sell the said mortgaged property, but
no bidders came forward to purchase the said property. The
Bank then decided to sell the said mortgaged property by
adopting the mode of selling property by sealed tender.
Accordingly, the Sale and Recovery Officer issued a tender
notice dated 18.3.2007 calling for sealed tenders. The said
notice was published in a local newspaper “The Tarun Bhagat”
also of the same date. As per the said tender notice, sealed
quotations were invited from the public on or before 23.3.2007.
5. Two sealed tenders were received on 20.3.2007. A bid of
Rs. 86,00,000/- received from the appellant in the present
appeal was found to be the highest and accordingly, since the
appellant paid the entire bid amount of Rs. 86,00,000/-, a Sale
Certificate in favour of the appellant was issued on 23.4.2007.
6. Without availing of the procedure provided by Rule 37
(13) of the Multi State Co-operative Society Rules, 2002 by
which the defaulter/ borrower could approach the authorities
with an amount of 5% to be paid to the auction purchaser
together with the full amount of the outstanding loan and
expenses of attachment and sale to the decree holder, with
interest thereon, within 30 days of confirmation of sale. If this
were done, the said sale could have been set aside. Since the
borrower did not repay at any stage the money borrowed by
him, the borrower filed a Writ Petition being Writ Petition No.
325 of 2007 dated 21.6.2007 before the High Court of Bombay
at Goa to quash both the award and the certificate of sale
accorded in favour of the Appellant.
7. By the impugned judgment dated 23.12.2013, the High
Court has held that the Multi State Co-operative Societies Act,
1984 was repealed by the Multi State Co-operative Societies
Act, 2002, [hereinafter referred to as “the 2002 Act”] which Act
came into force on 19.8.2002. According to the High Court, the
new Act deems an award passed by the Assistant Registrar as
an award in an arbitration case, which is executable only under
the Arbitration and Conciliation Act, 1996 [hereinafter referred to
as “the 1996 Act”], and this being the case, the auction
proceedings were set aside by the High Court stating that the
award dated 5.10.2002 would be liable to be executed only in
the manner provided by the 1996 Act. It is the correctness of
this judgment that has to be inquired into in the present appeal.
8. Learned counsel for the appellants has placed the
relevant provisions of both the 1984 Act and 2002 Act, and has
relied in particular on Section 126(6) of the 2002 Act to contend
that all legal proceedings that had been initiated under the 1984
Act would continue under that Act. This being the case, it is
clear that as execution proceedings were initiated prior to 19th
August, 2002, which is the date of coming into force of the 2002
Act, the said proceedings would be saved despite repeal of the
1984 Act by the 2002 Act.
9. On the other hand, learned counsel appearing on behalf
of the respondent, argued that, under the 2002 Act, the 1996
Act alone would get attracted, and that, therefore, the High
Court judgment was correct. Learned counsel further argued
that even if the impugned judgment were to be set aside, other
points remained to be argued in the Writ Petition so that the
matter could then be remanded back to the High Court for
further consideration of these other points.
10. We have heard learned counsel for the parties. Before
dealing with the contentions raised before us it will be important
to set out some of the relevant statutory provisions.
“Multi-State Co-operative Societies Act, 1984
74. (1) Notwithstanding anything contained in any
other law for the time being in force, if any dispute
(other than a dispute regarding disciplinary action
taken by a multi-State co-operative society against
its paid employee or an industrial dispute as defined
in clause (k) of section 2 of the Industrial Disputes
Act, 1947) touching the constitution, management
or business of a multi-State co-operative society
arises-
(a) among members, past members and persons
claiming through members, past members and
deceased members, or
(b) between a member, past member or a person
claiming through a member, past member or
deceased member and the multi-State co-operative
society, its board or any officer, agent or employee
of the multi-State co-operative society or liquidator,
past or present , or
(c) between the multi-State co-operative society
or its board and any past board, any officer, agent
or employee, or any past officer, past agent or past
employee or the nominee, heirs or legal
representatives of any deceased officer, deceased
agent, or deceased employee of the multi-State
co-operative society, or
(d) between the multi-State co-operative society
and any other multi-State co-operative society,
between a multi-State co-operative society and
liquidator of another multi-State co-operative society
and the liquidator of another multi-State
co-operative society.
Such dispute shall be referred to the Central
Registrar for decision and no court shall have
jurisdiction to entertain any suit or other
proceedings in respect of such dispute :
Provided that all disputes in which a national
co-operative society is a party shall be referred to
the Central Registrar or any officer empowered to
exercise the powers of the Central Registrar.
(2) For the purposes of sub-section (1), the
following shall be deemed to be disputes touching
the constitution, management or business of a
multi-State co-operative society, namely :-
(a) a claim by the multi-State co-operative society
for any debt or demand due to it from a member or
the nominee, heirs or legal representatives of a
deceased member, whether such debt or demand
be admitted or not;
(b) a claim by a surety against the principal
debtor where the multi-State co-operative society
has recovered from the surety any amount in
respect of any debt or demand due to it from the
principal debtor as a result of the default of the
principal debtor, whether such debt or demand is
admitted or not;
(3) If any question arises whether a dispute
referred to the Central Registrar is or is not a
dispute touching the constitution, management or
business of a multi-State co-operative society, the
decision thereon of the Central Registrar shall be
final and shall not be called in question in any court.
76. Settlement of disputes.- (1) The Central
Registrar may, on receipt of the reference of dispute
under section 74,-
(a) elect to decide the dispute himself, or
(b) transfer it for disposal to any other person
who has been invested by the Central Government
with powers in that behalf.
(2) The Central Registrar may withdraw any
reference transferred under clause (b) of
sub-section (1) and decide it himself or refer the
same for decision to any other person who has
been invested by the Central Government with
powers in that behalf.
(3) The Central Registrar or any other person to
whom a dispute is referred for decision under this
section may, pending the decision of the dispute,
make such interlocutory orders as he may deem
necessary in the interest of justice.
85. Execution of decision, etc. – Every decision
or order made under section 30. Section 31, section
73, section 76, section 90, section 92 or section 93
shall, if not carried out.-
(a) on a certificate signed by the Central Registrar
or any person authorized by him in writing in this
behalf, be deemed to be a decree of a civil court
and shall be executed in the same manner as if it
were a decree of such court ; or
(b) where the decision or order provides for the
recovery of money, be executed according to the
law for the time being in force for the recovery of
arrears of land revenue :
Provided that any application for the recovery in
such manner of any sum shall be made –
(i) To the Collector and shall be accompanied by
a certificate signed by the Central Registrar or by
any person authorized by him in writing in this
behalf ;
(ii) Within twelve years from the date fixed in the
decision or order and if no such date is fixed, from
the date of the decision or order, as the case may
be; or
(c) be executed by the Central Registrar or any
person authorized by him in writing in this behalf, by
attachment sale or sale without attachment of any
property of the person or a multi-State co-operative
society against whom the decision or order has
been made.
Multi-State Co-operative Societies Act, 2002
84. Reference of disputes.- (1) Notwithstanding
anything contained in any other law for the time
being in force, if any dispute [other than a dispute
regarding disciplinary action taken by a multi-State
co-operative society against its paid employee or an
industrial dispute as defined in clause (k) of section
2 of the Industrial Disputes Act, 1947 (14 of 1947)]
touching the constitution, management or business
of a multi-State co-operative society arises-
(a) among members, past members and persons
claiming through members, past members and
deceased members, or
(b) between the member, past member and
persons claiming through a member, past member
or deceased member and the mutli-State
co-operative society, its board or any officer, agent
or employee of the mutli-State co-operative society
or liquidator, past or present, or
(c) between the multi-State co-operative society or
its board and any past board, any officer, agent or
employee, or any past officer, past agent or past
employee, heirs or legal representatives of any
deceased officer, deceased agent or deceased
employee of the multi-State co-operative society, or
(d) between the multi-State co-operative and any
other multi-State co-operative society, between a
multi-State co-operative society and liquidator of
another mutli-State co-operative society and the
liquidator of another multi-State co-operative
society.
Such dispute shall be referred to arbitration.
(2) For the purposes of sub-section (1), the
following shall be deemed to be disputes touching
the constitution, management or business of a
multi-State co-operative society, namely:-
(a) a claim by the multi-State co-operative society
for any debt or demand due to it from a member or
the nominee, heirs or legal representatives of a
deceased member, whether such debt or demand
be admitted or not;
(b) a claim by a surety against the principal debtor
where the multi-State co-operative society has
recovered from the surety any amount in respect of
any debt or demand due to it from the principal
debtor as a result of the default of the principal
debtor, whether such debt or demand is admitted or
not ;
(c) Any dispute arising in connection with the
election of any officer of a multi-State co-operative
society.
(3) If a question arises whether a dispute referred
to arbitration under this section is or is not a dispute
touching the constitution, management or business
of a multi-State co-operative society, the decision
thereon of the arbitrator shall be final and shall not
be called in question in any court.
(4) Where a dispute has been referred to
arbitration under sub-section (1), the same shall be
settled or decided by the arbitrator to be appointed
by the Central Registrar.
(5) Save as otherwise provided under this act, the
provisions of the Arbitration and Conciliation Act,
1996 (26 of 1996) shall apply to all arbitration under
this Act as if the proceedings for arbitration were
referred for settlement or decision under the
provisions of the Arbitration and Conciliation Act,
1996.
94. Execution of decisions, etc.- Every decision
or order made under section 39 or section 40 or
section 83 or section 99 or section 101 shall, if not
carried out,-
(a) on a certificate signed by the Central Registrar
or any person authorized by him in writing in this
behalf, be deemed to be a decree of a civil court
and shall be executed in the same manner as if it
were a decree of such court and such decree shall
be executed by the Central Registrar or any person
authorized by him in writing in this behalf, by
attachment and sale or sale without attachment of
any property of the person of the person or a
multi-State co-operative society against whom the
decision or order has been made; or
(b) where the decision or order provides for the
recovery of money, by executed according to law for
the time being in force for the recovery of arrears of
land revenue:
Provided that any application for the recovery
of any sum shall be made in such manner-
(i) To the Collector and shall be accompanied by a
certificate signed by the Central Registrar or by
any person authorized by him in writing in this
behalf;
(ii) Within twelve years from the date fixed in the
decision or order and if no such date is fixed,
from the date of decision or order, as the case
may be; or
(c) be executed by the Central Registrar or any
person authorized by him in writing in this behalf, by
attachment and sale or sale without attachment of
any property of the person or a multi-State
co-operative society against whom the decision or
order has been made.
126. Repeal and saving. (1) The Multi-State
Co-operative Societies Act, 1984 (51 of 1984) is
hereby repealed.
(2) Without prejudice to the provisions contained in
the General Clauses Act, 1897 (10 of 1897) with
respect to repeals, any notification, rule, order,
requirement, registration, certificate, notice,
decision, direction, approval, authorisation, consent,
application, request or thing made, issued, given or
done under the Multi-State Co-operative Societies
Act, 1984 (51 of 1984) shall, if in force at the
commencement of this Act, continue to be in force
and have effect as if made, issued, given or done
under the corresponding provisions of this Act.
(3) Every multi-State co-operative society, existing
immediately before the commencement of this Act
which has been registered under the Co-operative
Societies Act, 1912 (2 of 1912) or under any other
Act relating to co-operative societies in force, in a y
State or in pursuance of the provisions of the
Multi-unit Co-operative Societies Act, 1942 (6 of
1942) or the Multi-State Co-operative Societies Act,
1984 (51 of 1984), shall be deemed to be registered
under the corresponding provisions of this Act, and
the bye-laws of such society shall, in so far as they
are not inconsistent with the provisions of this Act,
or the rules, continue to be in force until altered or
rescinded.
(4) All appointments, rules and orders made, all
notifications and notices issued and all suits and
other proceedings instituted under any of the Acts
referred to in sub-section (1) shall, in so far as they
are not inconsistent with the provisions of this Act,
be deemed to have been respectively made, issued
and instituted under this Act, save that an order
made cancelling the registration of a multi-State
co-operative society shall be deemed, unless the
society has already been finally liquidated, to be an
order made under section 86 for its being wound up.
(5) The provisions of this Act shall apply to-
(a) any application for registration of a multi-State
co-operative society;
(b) any application for registration of amendment of
bye-laws of a multi-State co-operative society,
pending at the commencement of this Act and to the
proceedings consequent thereon and to any
registration granted in pursuance thereof.
(6) Save as otherwise provided in this Act, any legal
proceeding pending in any court or before the
Central Registrar or any other authority at the
commencement of this Act shall be continued to be
in that court or before the Central Registrar or that
authority as if this Act had not been passed.”
11. The first thing that can be noticed is that an adjudication
made under Section 74 and 76 of 1984 Act can be executed in
the manner provided by Section 85 of the 1984 Act. Every
decision or order made under Section 76 can be executed in
three ways. We are concerned with sub-clause (c), in particular,
inasmuch, as on the facts of the present case, the execution
application was made to attach and sell the property of the
persons against whom the said order has been made.
12. The scheme of the 2002 Act which replaces the 1984 Act
is a little different. Section 84 of the 2002 Act corresponds to
Section 74 and 76 of the 1984 Act. With this difference – that
disputes that have been referred to arbitration are now to be
settled or decided by the Arbitrator to be appointed by the
Central Registrar, and the provisions, therefore, of the 1996
Arbitration and Conciliation Act shall apply to such arbitration as
if the proceedings for arbitration were referred for settlement or
decision under the provisions of the said Act.
13. Thus it can be seen that Section 84 (4) and (5) of the new
Act provide for a different scheme. Equally, Section 94 which
provides for execution of certain decisions and orders made
under the 2002 Act, mentions various Sections, but Section 84
is conspicuous by its absence. This is obviously for the reason
that the entire proceedings have now to be conducted under
the 1996 Act, including execution of the arbitration Award made
under the said Act. The question before the High Court was
whether proceedings initiated under the old Act could continue
under the said Act.
14. For this, it is important to advert to Section 126(6), which
has been completely missed by the High Court. By this Section,
any legal proceeding pending before any authority at the
commencement of the 2002 Act shall be continued to be
before that authority as if the 2002 Act had not been passed.
15. The expression “legal proceeding” has been the subject
matter of consideration in the Federal Court decision in
Governor-General in Council v. Shiromani Sugar Mills Ltd.,
AIR 1946 FC 16. In that decision Section 171 of the Indian
Companies Act, 1913 came up for consideration. That Section
reads as follows:
“When a winding-up order has been made or a
provisional liquidator has been appointed, no suit or
other legal proceeding shall be proceeded with or
commenced against the company except by leave
of the court, and subject to such terms as the court
may impose.”
16. The Federal Court held that the expression “other legal
proceedings” in Section 171 of the Indian Companies Act, 1913
comprises any proceeding initiated by the revenue for recovery
of tax dues under the Indian Income Tax Act. There is no
warrant for a narrow construction of such expression as
meaning ‘proceedings only in courts’. The Federal Court
specifically held that initiating and putting into force the
collection of arrears of income tax as arrears of land revenue by
authorities under the Income Tax Act would be a “legal
proceeding”.
17. In Binod Mills Co. Ltd. Ujjain (M.P.) v. Suresh Chandra
Mahaveer Prasad Mantri, Bombay, 1987 (3) SCC 99, this
Court had to construe Section 5 of the M.P. Sahayata Upkram
(Vishesh Upbandh) Adhiniyam, 1978. Section 5 of the said
Adhiniyam reads as follows:
“5. Suspension of suits or other legal
proceedings against relief undertakings.—As
from the date specified in the notification under
sub-section (1) of Section 3, no suit or other legal
proceeding shall be instituted or commenced or, if
pending, shall be proceeded with against the
industrial undertaking during the period in which it
remains a relief undertaking any law, usage,
custom, contract, instrument, decree, order, award,
settlement or other provisions whatsoever
notwithstanding.”
18. This Court referred in detail to the aforesaid Federal Court
decision, and further went on to hold that Section 5 would
include execution petitions that were filed to execute decrees
under the Code of Civil Procedure.
19. It is thus clear that the proceeding in execution initiated
under Section 85(c) of 1984 Act and pending before the
authorities under the said Act prior to 19th August, 2002, would
continue unhindered by the repeal of the 1984 Act by the 2002
Act. This being the case, it is clear that the judgment under
appeal is incorrect, and would have to be set aside.
20. In the affidavit in reply filed by the bank to the Writ
Petition, the bank states that it has recovered the entire loan
due together with interest amounting to Rs.85,15,311.75 as
against Rs.86 lakhs received in the auction proceedings, and admits
that the balance amount of Rs. 74,688.25 over and above the loan
dues are payable to the appellant. This being the case, and in order
to do complete justice between the parties, it is ordered that the
amount of Rs.74,688.25, together with interest at the rate of 19
per cent compounded per annum with effect from 1st April,
2007, be paid by the bank to the appellants within a period of
four weeks from the date of pronouncement of this judgment.
21. Learned counsel for the respondent exhorted us to send
the matter back for a decision on grounds (V) and (VI) of the
Writ Petition which read as follows:
“(V) The Petitioner further submits that the said Sale
Certificate issued by Respondent no.2 pursuant to
the notice dated 17.3.2007 is also void being
passed under the colour of powers, in as much as
the Respondent no.2 could not give a go-bye to the
mandate of Rule 36 of the Multi-State Co-operative
Societies Rules and decided to hold the auction
and/ or open the tenders in a period short of 15
days, in as much as the said Rule does not provide
for relaxation. On the other hand, it mandates that
the notice shall be of a period of 15 days.
(VI) The entire action of the Respondent No. 2 is
malafide and meant to favour of the Respondent
No.3 in as much as facts stated above make it clear
that, that apart, the conduct of the Respondents in
not providing the certified copies of the
proceedings and keeping the Petitioner in the dark
when she is the owner of the property and
surreptitiously seeking to hold the auction giving a
go-bye to the statutory requirements makes it clear
that the Respondent No. 2 acted malafide with
respect and which act vitiates the entire
proceedings.”
22. We find that after six failed attempts to sell the property
we would not be inclined to accede to this request at this point
in time. We find, on the facts of this case, that at no stage were
the respondent – borrowers ready to pay back the entire money
borrowed by them as far back as in 1997. We also find that a
Writ Petition was filed in 2007 without attempting to set aside
the certificate of sale granted under either Rule 37(13) or (14)
of the Multi State Co-operative Society Rules, 20021
. It is of
1
(13) (a) Where immovable property has been sold by the Sale Officer, any person either owning such
property or holding an interest therein by virtue of a title acquired before such sale may apply to have the
sale set aside on his depositing with the recovery officer –
(i) for payment to the purchaser a sum equal to five per cent of the purchase money, and
(ii) for payment to the decree-holder, the amount of arrears specified in the proclamation of sale
as that for the recovery of which the sale was ordered together with interest thereon and the expenses of
attachment, if any, and sale and other costs due in respect of such amount, less amount which may since
the date of such proclamation have been received by the decree-holder.
(b) If such deposit and application are made within thirty days from the date of sale, the recovery
officer shall pass an order setting aside the sale and shall repay to the purchaser, the purchase money so
far as it has been deposited, together with five per cent deposited by the applicant: Provided that if more
than one person have made deposit and application under this sub-rule, the application of the first
depositor to the officer authorised to set aside the sale, shall be accepted.
(c) If a person applies under sub-rule (14) to set aside the sale of immovable property, he shall
not be entitled to make an application under this sub-rule.
(14) (i) At any time within thirty days from the date of sale of immovable property, the
decree-holder or any person entitled to share in a rate able distribution of the assets or whose interests
are effected by the sale, may apply to the recovery officer to set aside the sale on the ground of a material
irregularity or mistake or fraud in publishing or conducting it:
Provided that no sale shall be set aside on the ground of irregularity or fraud unless the
recovery officer is satisfied that the applicant has sustained substantial injury by reason of such
irregularity, mistake or fraud.
some significance that it is not the appellant’s case that the
property has been sold at an undervalue. Also, as has been
pointed out above, the opportunity to have the sale certificate
set aside under Rule 37(13) has not been availed. Ground V of
the Writ Petition is in reality a ground relatable to Rule 37(14),
as, according to the petitioner, there is a material irregularity in
conducting the sale. For the petitioner to make out such a
ground, he has first to apply to the recovery officer within 30
days from the date of sale. And further, the appellant has to
make out a case that he has sustained substantial injury by
reason of such irregularity. Ground V of the Writ Petition does
not even refer to substantial injury for the reason that is not the
(ii) If the application is allowed, the recovery officer, shall set aside the sale and may direct a fresh
one.
(iii) On the expiration of thirty days from the date of sale if no application to have the sale set
aside is made or if such application has been made and rejected, the recovery officer shall make an order
confirming the sale:
Provided that if he shall have reason to believe that the sale ought to be set aside
notwithstanding that no such application has been made or on grounds other than those alleged in any
application which has been made and rejected, he may, after recording his reasons in writing, set aside
the sale.
(iv) Whenever the sale of any immovable property is not so confirmed or is set aside, the deposit
or the purchase money, as the case may be, shall be returned to the purchaser.
(v) After the confirmation of any such sale, the recovery officer shall grant a certificate of sale
bearing his seal and signature to the purchaser, and such certificate shall state the property sold and the
name of the purchaser and it shall be conclusive evidence of the fact of the purchase in all courts and
tribunals, where it may be necessary to prove it and no proof of the seal or signature of the recovery
officer shall be necessary unless the authority before whom it is produced shall have reason to doubt its
genuineness.
(vi) An order made under this sub-rule shall be final, and shall not be liable to be questioned in
any suit or other legal proceedings.
appellant’s case that the property has been sold at a gross
undervalue. No relief can be given in the Writ Petition so as to
circumvent the statutory provisions contained in Rule 37(13)
and (14). Ground VI is totally vague and lacking in particulars.
A charge of malafides has to be made out with great clarity and
particularity. Also, the appellant cannot claim to be in the dark
as every auction sale was publicly advertised in newspapers.
We, therefore, do not accede to counsel’s fervent plea to remit
the rest of the Writ Petition to the High Court for hearing.
23. We therefore set aside the judgment under appeal as a
whole. There will not be any order as to costs.
..............................J.
(DIPAK MISRA)
..............................J.
(R.F. NARIMAN)
New Delhi;
September 6, 2016
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