LAKSHMANASAMI GOUNDER versus C.I.T. SELVAMANI AND ORS.

Citation: [1991] SUPP. 2 S.C.R. 181 · Decided: 01-11-1991 · Supreme Court of India · Bench: S. RATNAVEL PANDIAN · Disposal: Appeal(s) allowed

Judgment (excerpt)

LAKSHMANASAMIGOUNDER 
v. 
C.I.T. SELVAMANI AND ORS. 
NOVEMBER 1, 1991 
A 
(S.RATNAVAL PANDIAN AND K. RAMASWAMY, JJ.] 
B 
Tamil Nadu Revenue Recovery Act, 1894:~ 
Sections 36 & Forms 7 and 7A-Omission of specification of place 
of sale-Sale rendered irregular and invalid. 
The appellant was alleged to have misappropriated a sum of 
Rs. 12,163.50 [though acquitted of the charge of misappropriation] 
and for the recovery thereof his 13.07 acres of. coffee estate was 
brought to sale under the Tamil Nadu Revenue Reco'Very Act, 1894. 
c 
On March 30,1979 the sale by public auction was held by the D 
Tebsildar. The first respondent purchased the said estate for a sum 
of Rs. 12,225 and deposited a sum of Rupees 2000 being 15% of the 
sale price. Under section 36 of the Act, be should have deposited the 
balance consideration within 30 days from the date of the auction. 
This sale was confirmed on October 23,1981 and the balance amount E 
was deposited on November 4, 1981. 
So the appellant filed an application to set aside the sale but 
the Revenue Divisional Officer overruled the objections and dis-
missed tlie application. On appeal to Additional District Collector 
on October 13, 1982, the sale was set aside. So 'the first respondent F 
filed writ petition in the High Court and the single High Court 
Judge quashed the order of the Additional District Collector. The 
writ appeal by t'1e appellant to the Division Bench was also dis-
missed. Hence the appellant came to this Court. 
The appellant urged that under section 36 of the Act it is 
G 
mandatory that the date and place of sale 'shall' be published in the 
Gazettee and that the publication did not mention the place of sale 
so the sale is invalid in law. It was further submitted that it was 
equally mandatory that the balance sale consideration of 85% should 
be deposited within 30 days from the date of sale which was done by 
the first respondent only on November 4, 1981 long after one year H 
181 
182 
SUPREME COURT REPORTS 
(1991) SUPP. 2 S.C.R. 
A 
and eight months of the date of sale and therefore illegal. While the 
first respondent contended tha~ it was Form 7 and not Form 7A that 
would be applicable to the facts of the instant case and that Form 7 
contains the place of salt: and that it was complied with. Therefore, 
the said sale is .not illegal. It was further submitted that the deposit 
was made after protracted correspondence and that the non-deposit 
B 
within 30 days from .the date of sale is not illegal since the deposit 
was accepted by the authority. Therefore the confirmation of the 
sale is not illegal. 
c 
D 
E 
F 
G 
H 
Granting the special leave, dismissing the writ Petition, setting 
aside the Judgment of the High Court, and restoring the order of 
the Additional District Collector, the Court 
HELD: That in the instant case, the High Court has wholly 
misconceived section 36 of the Act. A reading of the said section 
manifests that the word 'shall' is mandatory in the context. The 
publication is an invitation to the intending bidders to prepare an" 
participate at the bid. Unless there is due publication of lhe date 
and the place of sale, the intending purchasers cannot be expected 
to run after the sale officer. The sale officer has a statutory duty 
and a responsibility to have the date and place of sale mentioned in 
the notice giving due publication in terms of the Act and the Rules. 
Public auction is one of the modes of sale intending to get highest 
competitive price for ~he property and it also ensures fairness . in 
actions of the public authorities or the sale officers who should act 
fairly objectively and kindly. Nothing should be suggestive of bias 
favouritism nepotism or beset with suspicious features of under bid-
ding detrimental to the legitimate interest of the debtor. [184 F, G -
185 A] 
Further it is settled law that the word 'shall' be construed in 
the light of the purpose of the Act or Rule that seeks to serve. Even 
though tbe word 'shall' be ordinarily mandatory but in the context 
or if the intention is otherwise it may be construed to be directory. 
The construction ultimately depends upon the provision itself. Con-
sidered from this prospertive of non-compliance of section 35 that is 
omission to mention the place of sale would visit the deprivation of 
the property to the debtor for an adequate consideration due to 
absence of competing bidders. Hence the specification of the date & 
place of sale 'shall' be m

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