Case Name : Jagan Singh & Co vs Ludhiana Improvement Trust & Ors Case Reference: 2022 SCC OnLine SC 1144 Case Number: CA No. 371/2022 Court: Supreme Court Bench: 03 Coram: Sanjay Kishan Kaul (Author), S Ravindra Bhat, M M Sundresh Date: 02.09.2022
Though right to property is not a fundamental right, it is still a constitutional right under Article 300A. A person can be deprived of the rights of property only in manner known to law.
A bona fide purchaser for value in an auction-sale is treated differently than a decree holder purchasing such properties.
CPC - Order XXI rule 90 has a mandatory twin test of:
- (1) irregularity or fraud being proved;
- (2) substantial injury being sustained.
Order XXI CPC is exhaustive and in the nature of ac complete Code. However the various stages of Order XXI CPC when violated cannot give right of extra indulgence and cannot be a licence to prolong litigation ad infinitum
Refer also: Improvement Trust, Ludhiana vs Ujagar Singh, (2010) 6 SCC 786 : negligence of counsel should not be blamed on the parties. Saheb Khan vs Mohd Yousufuddin, (2006) 4 SCC 476: Safest rule to determine what is an irregularity and what is a nullity is to see whether the party can waive the objection. — Approved in Chilamkurti Bala Subrahmanyam vs Samanthapudi Vijaya Lakshmi, (2017) 6 SCC 770 Sadashiv Prasad Singh vs Harender Singh : (2) Bona fide purchaser for value in auction sale is treated differently than a decree holder purchasing such properties, even if such a decree is set aside, the interest of bona fide purchaser in auction sale is saved. Rights of auction-purchaser in the property cannot be extinguished except in cases where the said purchase can be assailed on the grounds of fraud or collusion. Janatha Textiles vs Tax Recovery Officer (2008) 12 SCC 582 : There is a clear distinction between a stranger who is a bona fide purchaser of the property at an auction-sale and a decree-holder purchaser at a court auction. Strangers to the decree are afforded protection by the court because they are not connected with the decree. Unless the protection is extended to them the court sales would not fetch market value or fair price of property Velji Khimji & Co vs Official Liquidator of Hindustan Nitro Product (Gujarat) Ltd (2008) 9 SCC 299 : Where auction is not subject to confirmation by any authority, auction is complete on the fall of the hammer and certain rights accrue in favour of auction purchaser. However, where auction is subject to subsequent confirmation by some authority (under a statute or terms of the auction) the auction is not complete and no rights accrue till the same is confirmed by the said authority. Once the sale is confirmed by that authority, certain rights accrue in favour of the auction purchaser and these rights cannot be extinguished except in exceptional cases of fraud.
See also: CPC - Order XXI rule 17 CPC - Order XXI rule 54 CPC - Order XXI rule 66 CPC - Order XXI rule 89 Constitution - Article 300A