Pukh Raj vs Parbha and Others

Jagat Narayan, J.—This is a decree-holder''s appeal against an appellate order of the Civil Judge, Jalore.

A decree for money was passed against one Bhera on 16-1-59. The decree was executed against the two sons and a widow of Bhera after his death, and a house was sold in execution of the decree on 4-7-1965, The house was purchased by the decree-holder with the permission of the Court, After the sale had taken place, but before it was confirmed, one of the sons of Bhera namely Mota applied for being adjudged insolvent. His application was admitted and the executing Court was intimated about it on 6-8-65. On 7-8-1965 the Receiver applied to the Court for possession over the house and prayed that the sale be not confirmed. The executing Court did not confirm the sale, and by the order dated 9-10-65, directed that the possession over the house, which had been sold, be handed over to the Receiver. This order was confirmed on appeal by the Senior Civil Judge, Jalore. Both the Courts below purported to follow the decision of the Calcutta High Court in Mahendrakumar Baishya Shaha Vs. Deeneshchandra Ray Chaudhuri, That case is distinguishable inasmuch as the intimation about the admission of the insolvency application was received there before the sale had taken place. It was held that a sale by an executing court after notice of the admission of the insolvency petition was void.

In the present case, the sale had taken place before Mota applied for being adjudged as insolvent. The sale was therefore neither void nor voidable. Section 52 of the Provincial Insolvency Act, 1920 runs as follows:

"Where execution of a decree has issued against any property of a debtor which is saleable in execution and before the sale thereof notice is given to the Court executing the decree that an insolvency petition by or against the debtor has been admitted, the Court, shall, on application, direct the property, if in the possession of the Court, to be delivered to the Receiver, but the costs of the suit in which the decree was made and of the execution shall be a first charge on the property so delivered, and the Receiver may sell the property or an adequate part thereof for the purpose of satisfying the charge".

That section has no application to a case where the execution takes place before an application for adjudication is made. It was held in Charanjit Singh v. Sardar Mohammad AIR 1935 Lah 690 that where the decree-holder has been given permission to bid, the decretal amount is set off against purchase price automatically by operation of law.

I accordingly allow the appeal with costs and set aside the orders of the courts below, I direct that the sale shall be confirmed in favour of the decree-holder.