Allowed

Dr. Anantha Kamath v. K. Krishnan

Kerala HC12 Oct 2021OP(C)/1011/2021

Case brief

AI extract

What is this about?

The High Court of Kerala allowed an original petition challenging the fixation of upset price in an execution proceeding. The Court held that the lower court erred by relying solely on the petitioner's suggestion without verifying market value or considering whether the entire property needed to be sold. The appeal was allowed, and the matter remitted.

What did the court decide?

Original Petition allowed; Impugned orders set aside; Matter remitted to execution court to fix fair value/upset price based on materials and expedited proceedings.

Dr. Anantha Kamath Vs K. Krishnan — Execution and Attachment | Kerala HC (2021)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE A. BADHARUDEEN

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TUESDAY, THE 12^TH DAY OF OCTOBER 2021 / 20TH ASWINA, 1943

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OP(C) NO. 1011 OF 2021

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AGAINST THE ORDER DATED 22.03.2021 IN E.P.NO.76/2015 AND ORDER DT.9.4.2021 IN E.A.NO.4/2021 IN E.P.NO.76/2015 IN OS 54/2012 OF SUB

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COURT, KASARAGOD

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PETITIONER/PETITIONER/DECREE HOLDER/PLAINTIFF

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DR. ANANTHA KAMATH AGED 75 YEARS S/O.LATE HARIRAYA KAMATH, RESIDING AT NANDA GOKULA, NEAR S V V TEMPLE , KASARGOD KASBA VILLAGE AND POST, KASARGOD - 671 121.

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BY ADVS. R.LAKSHMI NARAYAN R.RANJANIE

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RESPONDENT/RESPONDENT/JUDGMENT DEBTOR/DEFENDANT

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K. KRISHNAN AGED 74 YEARS S/O.PANAN KARNAVAR, RESIDING AT KADAPPURAM, KASARGOD KASBA VILLAGE AND POST, KASARGOD - 671 121.

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BY ADVS. PUSHPARAJAN KODOTH K.JAYESH MOHANKUMAR VANDANA MENON VIMAL VIJAY

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THIS OP (CIVIL) HAVING BEEN FINALLY HEARD ON 04.10.2021, THE COURT ON 12.10.2021 DELIVERED THE FOLLOWING:

O.P(C).No.1011/2021

“C.R”

A. BADHARUDEEN, J.

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================================ O.P(C) No.1011 of 2021

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================================

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Dated this the 12^th day of October, 2021

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J U D G M E N T

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This Original Petition has been filed under Article 227 of the Constitution of India challenging Exts.P9 and P12 orders passed by the execution court (Sub Judge, Kasaragod). The petitioner herein is the decree holder and the sole respondent is the judgment debtor.

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2 . The petitioner is aggrieved in the matter of fixation of upset price at Rs.13 lakh per cent in respect of the property sought to be sold to realise the decree debt. According to the petitioner, Ext.P9 fixing the upset price at Rs.13 lakh is not a speaking order. Though E.A No.4/2021 was filed on 26.03.2021 as Ext.P10 to review Ext.P9, the learned Sub Judge dismissed the review petition also on an erroneous appreciation of the facts and the law. While challenging Exts.P9 and P12 it is argued by the learned counsel for the petitioner

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that the property proposed to be sold comes to 1.06 Acres, essentially

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O.P(C).No.1011/2021

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a residential property with landlocked situation. Being so, several attempts to sell the properties by private sale or by public auction became futile. Precisely the allegation of the petitioner is that fixation of upset price treating the value of one cent property at Rs.13 lakh is erroneous and is higher than the market value of the property in force. It is submitted further that the upset price ought to be fixed at Rs.3-3.5 lakh per cent.

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3 . Per contra, the learned counsel for the judgment debtor highlighted an affidavit filed by the petitioner/decree holder before the execution court produced as Ext.R1 in this case. The learned counsel submitted that in para.3 of Ext.R1 produced along with the counter affidavit, the decree holder suggested to fix the upset price at Rs.10 lakh per cent. On perusal of Ext.R1, this submission on the premise to sell the entire extent of property could be gathered.

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4 . The learned counsel for the respondent placed the following decisions in support of his contention on the point that only portion of the property sufficient to satisfy the decree alone would be sold in public auction and the judgment debtor shall not be unduly harassed.

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O.P(C).No.1011/2021

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(i) [1962 KLT 315], K.V.Thomas v. Malabar Industrial

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Co.Ltd. ; (ii) [2015(2) KLT SN 77 (C.No.87)], Augusthy v. Catholic Syrian Bank Ltd. ; (iii) [2018 (2) KLT 647], Thambi v.

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Sivan ; (iv) [1996 KHC 559], Harishankar v. Syndicate Bank of India & Ors.

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5 . However, it is submitted by the learned counsel for the petitioner that the decree holder suggested Rs.10 lakh per cent as the upset price so as to sell the entire extent of 1.06 acres of property. But the execution court not allowed the said prayer and only 46.25 cents were ordered to be sold @ Rs.13 lakh per cent. In fact para.2, para.3 and para.4 of the counter affidavit required to be extracted under:

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“2. I say that in the above E.P., 0.46 ¼ acres of land in R.S.No.121/2pt (121/2C1 as per commission plan) in Kasaragod Kasba Village belonging to the respondent was put for sale by fixing the upset price at Rs.10,00,000/- per cent on 19.12.2019 and again posted for sale on 05.03.2020 but no bidders have come forward to bid in the sale thus proposed on 05.03.2020.

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3 . I say I expect that if the entire properties of the respondent are put up for sale, there is a possibility that it would, be sold, I say therefore it is just and necessary that a fresh sale in respect of the entire properties may be ordered to be sold by fixing the upset price at Rs.10,00,000/- per cent.

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4 . I say therefore in the interest of justice and equity that the court may be pleased to order fresh sale of the entire E.P. properties by fixing an upset price at Rs.10 lakhs per cent as otherwise I will be put to heavy loss and hardship. “

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Precisely, the above extracted portion would indicate that the decree holder sought to fix the upset price @ Rs.10 lakh per cent with suggestion to sell the entire properties.

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6 . Whether such a suggestion is the sole basis for fixing the upset price is the matter to be considered. No doubt, the legal position that in all execution proceedings the court has to first decide whether it is necessary to bring the entire property to sale or such portion thereof as may seem necessary to satisfy the decree. If the property is large and the decree to be satisfied is small, the court must bring only such portion of the property the proceeds of which would be sufficient to satisfy the claim of the decree-holder. It is immaterial whether the property is one or several. Even if the property is one, if a separate portion could be sold without violating any provision of law only such portion of the property should be sold. This is not just a discretion but an obligation imposed on the court. The sale held without examining this aspect and not in conformity with this mandatory requirement would be illegal and without jurisdiction. [(1977) 3 SCC 337 : AIR 1977 SC 1789], Takkaseela Pedda Subba Reddi v. Pujari Padmavathamma ; [AIR

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1990 SC 119] , Ambati Narasayya v. M.Subba Rao & anr. and [(2006) 3 SCC 49], Balakrishnan v. Malaiyandi Konar are the relevant decisions on this point.

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7 . Thus it has to be held that it shall be the endeavour of the court, throughout the proceedings of sale, to obtain the adequate price of the property put in for sale. On obtaining inadequate price in auction sale, no alternative amount for substantial injury contemplated under Order 21 Rule 92 CPC. It is not in dispute that Order 21 Rule 64 of CPC statutorily mandates that any court executing a decree may order that any property attached by it and liable to sale, or such portion thereof as may seem necessary to satisfy the decree, shall be sold, and that the proceeds of such sale, or a sufficient portion thereof, shall be paid to the party entitled under the decree to receive the same. Order 21 Rule 66 provides the procedure for proclamation of sales by public auction. Going by Ext.P9 order, the same is not a speaking order and the order confined 2 sentences, viz., ' Respondent filed memo. E.A.No.1/2021 allowed. Upset price is fixed Rs.13 lakhs per cent '. However, some more details could be gathered from Ext.P12 order in E.A.No.4/2021 dated

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09.04.2021. In this E.A, decree holder sought to fix the upset price at Rs.4 lakh per cent asserting that the upset price fixed was too high considering the nature and lie of the property in a hilly area with no proper road access. On the other hand, the learned counsel for the judgment debtor submitted that the property was situated near New Bus stand, Kasaragod and is a prime location in the District Head Quarter. He also highlighted Ext.R1 affidavit to fix the upset price at Rs.10 lakh.

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8 . After having considered the said pleas, the learned Sub Judge passed Ext.P12 order as under:

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“....... The total extent of property is 1 Acre 6 cents out of which 46 cents put for sale. It is pertinent to note that the petitioner herein had filed E.A.2/20 dated 06.03.2020 seeking permission to fix the upset price as Rs.10,00,000/-. He had filed another application on E.A 1/21 dated 26.02.2021 seeking permission to bid the property in the public auction. Records shows that, once the entire matter was settled in mediation for a sum of Rs.3,00,00,000/- earlier on several occasions the property had put for auction sale. …....”

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Going by the relevant portion of the order as extracted above, one could notice that the learned Sub Judge not relied on any documents to arrive at the actual market value of the property. Instead, the upset

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price suggested by the decree holder in Ext.R1 at the rate of Rs.10

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lakh per cent was the basis on which the learned Sub Judge fixed the upset price at Rs.13 lakh.

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9 . In this connection the terms `necessary to satisfy the

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decree' in Order 21 Rule 64 of C.P.C, assume significance. That is to say, the estimate value of the property is a material fact to enable the purchaser to know its value. The value must be verified accurately and fairly as possible so that the intending bidders are not misled or to prevent them from offering inadequate price or to enable them to make a decision in offering adequate price. The court, when stating the estimated value of the property to be sold, must not accept merely the ipse dixit (unsupported dogmatic assertion) of one side. It is certainly not necessary for it to state its own estimate. R.66(2) (e) of O. XXI C.P.C. requires the court to state only the nature of the property so that the purchaser should be left to judge the value for himself. But, the essential facts which have a bearing on the very material question of value of the property and which could assist the purchaser in forming his own opinion must be stated, i.e., the value of the property. The whole object of O.XXI, R.66(2)(e) C.P.C is on this plank.

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10. Going by the spirit of Order 21 Rule 64 & 66 along with the settled legal position, it is categorically clear that fixation of upset price of the property is a matter which should be based on some materials and not merely on the submission made by some of the parties. A mere suggestion made by the decree holder to sell the entire decree schedule property @ Rs.10 lakh per cent cannot be the sole ground for the Sub Judge to fix the land value at Rs.13 lakh without support of any convincing materials. Thus it has to be held that Exts.P9 and P12 orders under challenge are erroneous for the above reason and as such unsustainable. Therefore, the same are liable to be set aside and the matter required to be remitted before the executing court for fixing the fair value and upset price of the decree schedule property and to sell the portion of the property which is required to satisfy the decree, by following the procedure discussed herein above.

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In the result, this Original Petition is allowed. Exts.P9 and P12 orders are set aside. The matter is remitted back to the execution court to fix the value of the property and upset price based on the materials available inclusive of Ext.P4(2) valuation certificate

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and other documents produced from the side of both the parties. Parties are set at liberty to produce additional documents in support of the actual market value of the property at present, so as to fix the fair value and upset price. Considering the fact that the Suit is of the year 2012 and E.P is of the year 2015, the execution court is directed to expedite the proceedings as early as possible taking note of the fact that the decree holder and judgment debtors are now aged 75 and

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74 years, respectively.

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(A. BADHARUDEEN, JUDGE)

rtr/

O.P(C).No.1011/2021

APPENDIX OF OP(C) 1011/2021

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PETITIONER'S EXHIBITS

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EXT.P1: PHOTOCOPY OF DECREE DT.14.11.2014 IN O.S.NO.54/2012 ANNEXING THE COMPROMISE PETITION.

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EXT.P2: PHOTOCOPY OF E.P.NO.76/2015 DATED 18.11.2015.

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EXT.P3: PHOTOCOPY OF THE COMMISSION REPORT DT.13.06.2016 ALONG WITH THE PLANS.

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EXT.P4: PHOTOCOPY OF THE MEMO DT.4.3.2016 ALONG WITH VALUATION CERTIFICATE DATED 18.02.2016 ISSUED BY VILLAGE OFFICER, KASARGOD, PRODUCED BEFORE THE EXECUTION COURT.

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EXT.P5: PHOTOCOPY OF THE ORDER DT.19.11.2019 IN EA.NO.36/2019.

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EXT.P6: PHOTOCOPY OF EA.NO.1/2021 DT.26.2.2021.

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EXT.P7: PHOTOCOPY OF THE COUNTER AFFIDAVIT FILED BY THE RESPONDENT IN EXT.P6.

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EXT.P8: PHOTOCOPY OF MEMO DATED 22.03.2021.

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EXT.P9: PHOTOCOPY OF ORDER DT.22.03.2021 IN EP NO.76/2015 IN OS NO.54/2012.

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EXT.P10: PHOTOCOPY OF EA NO.4/2021 DATED 26.3.2021.