2014 PLP 1222 (SCMR)

AMIR HANI MUSLIM, J.

This Appeal by leave of the Court is directed against the order dated 15-9-2010, passed by the Lahore High Court, Lahore, whereby the E.F.A. No.351 of 2008, filed by the appellants was dismissed.

2. The facts material for the disposal of the instant Appeal are that the respondent-Bank filed a suit before the Banking Court, Faisalabad, against the appellants for recovery of a sum of Rs.14,85098.72 along with markup and other charge. On 22-7-2007, the appellants filed application for leave to defend, which was dismissed in default on 4-9-2007. On 25-9-2007, the appellants filed application for restoration of application for leave to defend which, too, was dismissed on 26-9-2007, and the suit was decreed ex parte against the appellants. The property was put to auction on 12-4-2008. The reserve price of the property was fixed by the trial Court as Rs.20,00,000 and the respondents Nos.2 and 3 (Muhammad Arshad and Ali Muhammad sons of Muhammad Ismail) who deposited the advance money, had given the highest bid of Rs.27,60,

000. They were declared successful bidders and were asked to deposit 1/4th of the auction price before the Committee, which was appointed to conduct the auction proceedings by the trial Court. The said respondents deposited Rs.16,60,201 before the Committee and they were directed to deposit the remaining auction money within 15 days with the Executing Court, which amount was also deposited by them within the stipulated time. A report to this effect was submitted by the Committee in the Executing Court.

3. On 24-4-2008, the appellants filed an application under Order XXI, Rule 89, C.P.C., before the Executing Court, without deposit of any amount in terms of Order XXI, Rule 89, Sub-Rule (1)(a)(b), C.P.C. and sought permission of the Court to allow them to deposit the 5% of the purchase money and the proclaimed amount of sale. The application was objected to by the respondent-Bank as well as the auction purchasers, stating therein that in terms of Order XXI, Rule 84, C.P.C., the auction purchasers have deposited 1/4th of the auction price. They further pleaded that the remaining auction amount of 75% was also deposited by them within 15 days, in terms of Order XXI, Rule 2, C.P.C. and claimed issuance of the sale certificate. It appears that on 13-4-2008, the Executing Court directed the appellants to deposit sale price of the property besides the 5% amount in terms of Order XXI, Rule 89, Sub-Rule (1)(a)(b), C.P.C. and the matter was adjourned to 14-5-2008. The record shows that on 14-5-2008, the order of the Court passed on 13-4-2008 was not complied with by the appellants. The matter was postponed for 21-5-2008 by the Executing Court. On 21-5-2008, the Court observed in its order that the appellants have not deposited the entire sale price. The appellants were provided another opportunity by the Executing Court to deposit the entire amount of sale price by 3-6-2008. On 3-6-2008, the matter was simply adjourned at the request of the appellants to 11-6-2008 on which date the Presiding Officer was on leave, the matter was, therefore, posted for 17-6-2008. On 17-6-2008, the application for permission to deposit an amount of Rs.73,000 was made by the appellants and had further offered to deposit a further amount of sale price. This application was allowed subject to all just exceptions by the Executing Court and the matter was posted for 18-6-2008. On 18-6-2008, the matter was adjourned to 2-7-2008 and while adjourning the matter, the Executing Court had noticed in its order that the appellant has deposited an amount of Rs.16,60,

201. The matter was posted for 22-7-2008, 2-9-2008, 16-9-2008 and finally on 24-9-2008, the Executing Court dismissed the application of the appellants under Order XXI, Rule 89, C.P.C. and confirmed the sale in favour of Muhammad Arshad and Ali Muhammad, by issuing sale certificate. On 31-10-2008, the possession of the property was handedover to the auction purchasers. This order was challenged by the appellants in Writ Petition before the learned Lahore High Court, which was dismissed, by the impugned order. Hence this Appeal.

4. It is contended by the learned Counsel for the appellants that the Executing Court itself has permitted the appellants to deposit the amount by its order dated 17-6-2008, therefore, it ought to have allowed the application of the appellants under Order XXI, Rule 89, C.P.C. It was next contended that the Executing Court has ample powers, in law, to grant permission to deposit the amounts in terms of Order XXI, Rule 89, Sub-Rule (1)(a)(b), C.P.C. and for that purpose can extend time to facilitate the owner. He submitted that the restriction of 30 days as provided under Order XXI, Rule 89, C.P.C. would not come in way of the appellants, who made the application within 30 days from the date of the auction. In this regard, he has relied upon the language of the Rule 89, C.P.C.

5. As against this, the learned Counsel for the respondents has contended that the law requires a party to approach the Court in terms of Order XXI, Rule 89, C.P.C. and to deposit the amounts specified in Sub-Rule 1(a)(b) in order to show its bona fide. He submitted that the application without deposit of the amount referred to in Sub-Rule (1)(a)(b) was liable to be dismissed. He contended that the Executing Court has no power to extend time for deposit of amount referred to hereinabove as these deposits were condition precedent to the application under Order XXI, Rule 89, C.P.C.

6. He next contended that the respondents-auction purchasers were issued sale certificate on dismissal of the application of the appellants and were also put in possession of the property way back on 31-10-2008. He has submitted that the appellants, under the circumstances, did not have a right to seek cancellation of the sale in favour of the respondents by the Executing Court through auction. He lastly contended that the order passed in auction proceedings has been acted upon and vested right to enjoy the property purchased in Court auction has been created in favour of the auction purchasers, therefore, the learned High Court was justified in declining the relief sought by the appellants.

7. We have heard the learned Counsel for the parties and have perused the record. Order XXI, Rule 89 contemplates an application for setting aside the sale in execution of decree, in law, by the owner of the property and or by a person holding interest in the property under a title acquired by him prior to the sale on his depositing in Court:-- (a) for payment to the purchaser, a sum equal to 5% of the purchase money and; (b) for payment to the decree holder, the amounts specified in the proclamation of sale, as that for the recovery of which the sale was ordered, less any amount which may, since the date of such proclamation of sale, have been received by the decree holder.

8. Rules 89 requires that two primary conditions relating to deposit must be fulfilled. The applicant must deposit in the Court for payment to the auction purchaser 5% of the purchase money; he must also deposit amount specified in the proclamation of sale, lest any amount received by the decree holder since the date of proclamation of sale, for payment to the decree holder. Rule 89 of Order XXI, C.P.C. is intended to confer a right upon the judgment-debtor even after the property is sold to satisfy the claim of the decree holder and to compensate the auction purchaser by paying him the 5% of the purchase money. The provision is intended to defeat the claim of the auction purchaser unless the decree is simultaneously satisfied. Article 166 of the Limitation Act requires such an application as well as the deposit thereunder both are to be made within the period of 30 days from the date of sale. The deposit is a condition precedent to the entertainment of the application and the Court cannot extend time for deposit of the amounts under section 148 of the C.P.C. The date of sale used in the Rule relates to the date on which the property was knocked out to the highest bidder and not the date of confirmation. It may be observed that the Rules in the Civil Procedure Code are intended to secure proper administration of justice and it is, therefore, imperative that, they should be made to serve and be subordinate to the purpose rather than be left to operate as tyrant master. The Rule does not provide a permission of the Court for depositing all the amounts referred to in clauses (a) and (b) of Sub-Rule (1) Order XXI, Rule 89, C.P.C. as these amounts are known to the judgment debtor and are required to be deposited to establish his bona fide. In the case in hand, admittedly, the application was made by the appellants within 30 days from the date of sale but no amount was deposited by them which was a condition precedent to the entertainment of such an application. The Executing Court in law, was neither competent to entertain the application of the appellant nor empowered to extend time for depositing the amounts specified therein, as such an extension was barred under Article 166 of the Limitation Act.

9. Moreover, the appellants even failed to deposit the required amounts within the time granted by the Court and instead on 17-6-2008, the appellants deposited the required amount, which the Court has notified in its order dated 2-7-2008. The Court in the case in hand has allowed the deposit of the amounts by appellants "subject to all just exceptions", which implies that the other side has the right to object to such deposit and could not be construed to have been permitted by the Court.

10. Under the circumstances, the appellants have failed to deposit the amounts besides the fact that the Executing Court has no jurisdiction to entertain an application as contemplated under Order XXI, Rule 89, C.P.C., without deposit of the required amounts along with the application, within the date of sale by auction. As we have already noticed herein above that the deposit of the amounts in terms of the Rule are conditions precedent to the entertainment of the application, therefore, the Executing Court was not justified to entertain the application in the first place nor the Court was competent to extend time for deposit of the amounts being violative of the Article 166 of the Limitation Act. In the given circumstances, for the aforesaid reasons, we do not find any infirmity in the impugned judgment which could warrant interference by this Court.

11. This appeal is, therefore, dismissed leaving the parties to bear their own costs. MWA/A-6/SC Appeal dismissed.