* S 289. †See p. 191. case of moveable property, calculated from the date on which M. 291. The officer conducting any sale under this chap- sale, recording his reasons for such M, 292. No officer having any duty to perform in connection with any sale under this chapter shall either directly or indirectly bid for, acquire, or attempt to acany property sold at such sale. Officers concerned in exe- Defaulting purchaser an- deficiency of price (if any) which may happen on a re-sale †(o) under this Code by reason of the purchaser's default, and all expenses attending such resale, shall be certified to the Court by the officer holding the sale; and shall, at the instance of either the judgment-creditor or the judgment-debtor, be recoverable from the defaulter under the rules contained in this chapter for the execution of a decree for money. M. 294. No holder of a decree in execution of which Decree-holder not to bid property is sold shall, without the for or buy property without express permission of the Court, permission. bidt(p) for or purchase the property. When a decree-holder purchases with such permission, If decree-holder purchase, the purchase money and the amount due on the decree may, if he desires, be set-off against one another, and the Court executing the decree shall enter up satisfaction of the decree in whole or in part accordingly. M. 295. (270, 271,) amount of decree may be Proceeds of execution sale to be divided rateably among decree-holders. Whenevert (9) assets are realized by sale or otherwise in execution of a decree, and more persons than one have, prior to the realization, applied to the Court by which such assets are held for execution of decrees for money against the same judgment-debtor, and have not obtained satisfaction thereof, the assets, after deducting the costs of the realization, shall be divided rateably among all such persons: †(r) Where a mortgagee sues his mortgagor on a mortgage bond only for money and not for foreclosure, he cannot attach the mortgaged property, if passed to a stranger in execution of a decree, even though at such sale the stranger bought only the right, title and interest of his mortgagor. Goluckmonee. Deci v. R. S. Chukerbatti, ib. IX. 82. If a mortgagee is an execution creditor only on a money decree this sec. does not apply; he can take the surplus, and his lien will be reduced by so much. Bolakee Lall v. Chaudhri Bansi Singh, ib. VII. 309. A purchaser under a decree obtained upon a mortgage bond-decree ordering the mortgagee's property to be sold in execution, purchases both rights of debtor and mortgagee's rights. Proladh Misser v. Udit Narayan Sing ib. X. 291. A Hindu woman holding a decree for maintenance against a person who has no other property besides the one, the proceeds of which are in dispute, is entitled to a preference over any other judgment-debtor. Joorawun Singh v. Musst. Jhoota, ib. II. Mis., 29. On the death of H., a Hindu, his three sons, B., G., and P., divided his estate while a decree against the deceased remained unsatisfied. In execution the two shares taken by B. and G. were alone sold, one-third having been claimed by K, as purchased by him from P., and a sum was realized beyond the two-thirds of the decree which those two brothers ought to have satisfied. Held that, by reason of that sale, B. and G. acquired a right to be paid out of the one-third of H's estate which had been taken by P., the excess over the twothirds of the debt. Unoda Soondri Dasi. v. Oudhubnath Roy, ib. XI. 125. As to the preferential rights of an official assignee the law is as follows:The provision in Indian Insolvent Act 11 and 12 Victoria, Cap. 71, as to the vesting of the estate and effects of the insolvent in the assignee, are similar to the provisions in the English Insolvent Acts 1 and 2 Victoria, Cap, 110, and there is nothing in the Indian Act which can give to the assignee under it greater rights than the assignee in England has. The vesting order of the Insolvent Debtor's Court, under section 37 of the English Act, has the same legal operation as the assignment to the provisional assignee Lord had for which it was substituted. St. Leonards, in the case of in re Atkinson, XI. De Gcse Macnaghten Gordon, 140, says : "It may be considered as decided that the assignee in insolvency represents the insolvent; he stands in his place, and takes only such interest as he can give, and is subject to all equities by which the insolvent is bound. "It has, however, been contended that the effect of the Act is so to vest the property that the insolvent cannot afterwards divest it; but this is not so, for there are no words in the Act giving to the assignee any higher interest than the insolvent himself has; the assignee does not therefore take, so as not to be subject to equities as administered in this Court." And Lord Westbury, in moving the judgment of the House of Lords in Fleming v. Howden, L. R., I, Scotch Appeals, 382, lays down the law thus:"The trustee in Scotland under a sequestration is in the same position as a gratuitous alienee. He takes such estate or interest only as the bankrupt can lawfully convey. So in England, the assignee takes such interest only as the bankrupt can lawfully depart withal. The force of the two expressions is the same, and the implied consequence to the trustee or assignee ranks no higher than a gratuitous alienation." No higher authorities could be quoted for the rule, which is to be applied in any case where it is necessary to determine what is the right of an official assignee. No doubt, as it was argued, he represents the creditors and is a trustee for them, but that cannot give him a greater interest in the property than the insolvent had. It appears that in the decisions in the Indian Courts, this rule has been lost sight of, and the question has been treat. ed as if it were, whether the property passed to the official assignee, and whether any charge or lien upon it was created by the attachment, except perhaps in the case of Gamble v. Bhola Gir, where the point was not raised, and it was assumed that, if attachment after decree was complete without re-seizure by the nazir, the execution creditor was entitled to preference as regarded the attached goods over the official assig M. Provided that,"(s) when any property is sold subject to a mortgage or charge, the mortgagee or incumbrancer shall not be entitled to share in any surplus arising from such sale: Proviso where property is sold subject to mortgage. Provided *(t) also that when any property liable to be sold in execution of a decree is subject to a mortgage or charge, the Court may, with the assent of the mortgagee or incumbrancer, order that the property be sold free from the mortgage or charge, giving to the mortgagee or incumbrancer the same right against the proceeds of the sale as he had against the property sold. If all or any of such assets be paid to a person not entitled to receive the same, any person so entitled may sue such person to compel him to refund the assets. Nothing in this section affects any right of the Government. (b).—Rules as to Moveable Property. M. 296. (248) If the property to be sold be at negotiable Rules as to negotiable seinstrument or a share in any public curities and shares in pub. company or corporation, the Court lic companies. may, instead of directing the sale to be made by public auction, authorize the sale of such instrument or share through a broker at the market rate of the day. Payment for moveable property sold. M. 297. (251) In the case of other moveable property, the price of each lot shall be paid for at the time of sale, or as soon after as the officer holding the sale directs, and in default of payment the property shall forthwith be again put up and sold. On payment of the purchase-money, (a)the officer holding the sale shall grant a receipt for the same, and the sale shall become absolute. M. 298. (252) Noirregularity in(6)†publishing or§conductIrregularity not to viti ing the sale of moveable property shall ate sale of moveable provitiate the sale; but any person susperty, but any person in- taining any injury by reason of such jured may sue. irregularity at the hand of any other person may institute a suit against him for compensation, or (if such other person be the purchaser) for the recovery of the specific property and for compensation in default of such recovery. Delivery of moveable M. 299. (266) When the property sold is a negotiable instrument, or other moveable property, of which actual seizure has been made, the property shall be de livered to the purchaser. property belonging to de- as being analogous. It is a little remarkable that, although the English law has been so much referred to in considering this question, the case in the English Courts which is most applicable to it appears to have been the least noticed. It is not mentioned in the elaborate judgment of the High Court of the NorthWestern Provinces, the case of Mulchand Fuller; Adolphus and Ellis, XI. 859. There a suit of fi. fa. against a person was lodged with the Deputy of the Sheriff, who immediately issued a warrant to an officer. Afterwards, on the same day, a vesting order was made by the Insolvent Debtors' Court, transferring the person's estate, and the assignee took possession of his property under it, The Sheriff's officer afterwards seized it, and it was held by the Court of Queen's Bench that the seizure was proper; that the vesting order only vested the property in the assignee subject to the rights of the execution-creditor. The Court entertained no doubt, and the case is an instance of the application of the rule, that the assignee takes the property subject to the rights and equities which affected it at time of bankruptcy or insolvency. Sec. 276 appears to furnish a strong argument against the official assignee. By that section the right or equity created by the attachment is such, that it cannot be affected by even a bona fide alienation for value without notice of it. The vesting order "ranks no higher than a gratuitous alienation" (Lord Westbury in the judg ment before quoted); and it cannot be consistently held that it is to defeat the attachment, when an alienation for value is not allowed to do so. It was argued that, after the vesting order the property cannot be sold as that of the judgmentdebtor's, as it has passed to the official assignee; but the answer to that is, it has so passed, subject to being divested by a sale in execution of the decree, and it may still be sold as the property of the judgment-debtor. Anand C. Pal v. P. L. Soobalah. S. W. R., XIV. (F. B.) 33. The vesting of an insolvent's property in the official assignee is liable to be divested by a sale in pursuance of an attachment subsisting at the time of the vesting order. Anand Chunder Paul v. Punchu Lall Soor, ib. XV. 257. (b)-Rules as to Moveable Property. Instead of selling by public auction, negotiable securities and shares may be sold through a broker at the market rate of the day. In all other cases the price of each lot must be paid for at once. or as soon after as the officer selling directs; in default, the property is to be put up again and sold. On payment being made, a receipt is to be given by the officer selling, and the sale becomes absolute. No irregularity in publication or sale vitiates it. A person injured by any such irregularity may sue for compensation; or, if injurer be purchaser, can sue him for recovery of the specific property, or for compensation in default. Property actually seized is handed over to the purchaser; but if it be subject to the possession of another, then delivery is made by notice prohibiting it to be given to any but the purchaser. This procedure of a written notice must be adopted with debts and shares in public companies. The Judge is empowered to endorse and execute all documents necessary for such transfer,and, until transfer, may appoint person to receive interest and dividend and grant receipts; such receipts to be as valid as if made by party himself. In any other moveable property not provided for, the Court gives a vesting order. (a) At sec. 498 the reader will find special | (b) A plaintiff who seeks damages on the provision for sale of moveable property subject to speedy and natural decay. The officer conducting a sale of moveable property has discretion to allow the purchase-money to be paid at a reasonable time after the sale has been made. Shah Fareed Alum v. Sheo Churn Ram, N.-W. P., 1872, 37. All sales by Small Cause Court Judges should be conducted strictly in accordance with this section. If purchaser is the decree-holder, his receipts may be accepted as cash, but provision must be made for realizing all fees of Court. Indro Narain Deb v. Govind Chunder Dhur, S. W. R., XV. 368. ground of an illegal omission to give him notice of the sale of his property in execution of a decree, in accordance with sec. 248, is bound to show that there was such an illegal omission. Kassee Nath Roy Chaudhri v. Hullodhur Roy, ib. 11. 60. No sale in execution of a decree can take place, either of moveable or immoveable property, without previous attachment; and a sale without prior attachment is illegal. The omission in a sale proclamation to mention particulars as to the numbers, value, &c., of Government promissory notes under attachment for sale, is not such an irregularity as will vitiate the sale, though *See Act XVIII. 1869 §. 2 (19). + See p. 202, Delivery of moveable ment-debtor is entitled M. 300. (262.) When the property sold is any moveable property(c) to which the judgmentdebtor is entitled subject to the possession of some other person, the delivery thereof to the purchaser shall be made by giving notice to the person in possession prohibiting him from delivering possession of the property to any person except the purchaser. M. 301. (265.) When the property sold is a debt not secured by a negotiable instrument, or Delivery of debts and of is a share(d) in any public company, shares in public companies. the delivery thereof shall be made by a written order of the Court prohibiting the creditor from receiving the debt or any interest thereon, and the debtor from making payment thereof, to any person except the puror prohibiting the person in whose name the share may be standing from making any transfer of the share to any person except the purchaser, or receiving payment of any dividend or interest thereon, and the manager, secretary, or other proper officer of the company from permitting any such transfer or making any such payment to any person except the purchaser. instrument and shares. M. 302. (267) If the endorsement or conveyance of the party in whose name a negotiable Transfer of negotiable instrument or a share in any public company is standing, is required to transfer such instrument or the certificate of the share, the Judge may endorse the instrument or the certificate of the share or may execute such other document as may be necessary. The endorsement or execution shall be in the following form or to the like effect:-" A. B. by C. D., Judge of the Court of (or as the case may be); in a suit by E. F. against A. B." Until the transfer of such instrument or share, the Court may, by order, appoint some person to receive any interest or dividend due thereon, and to sign a receipt for the same; and any endorsement made or document executed or receipt signed as aforesaid shall be as valid and effectual for all purposes as if the same had been made or executed or signed by the party himself. M, 303. (261.) In the case of any moveable property not hereinbefore provided for, the Court Vesting order in case of may make anorder vesting such property in the purchaser, or as he may other property direct; and such property shall vest accordingly. 304. Sales of immoveable property in execution of a de Sales of land by Court not inferior to a District Court. cree may be ordered by any Court othe than a Court of Small Causes.†(e) (Continued on page 200.) |