Defaulting purchaser answerable for loss on re-sale
Full Text
Any deficiency of price which may happen on a re-sale by reason of the purchaser's default, and all expenses attending such re-sale, shall be certified to the Court by the officer or other person holding the sale, and shall, at the instance of either the decree-holder or the judgment-debtor, be recoverable from the defaulting purchaser under the provisions relating to the execution of a decree for the payment of money.
Plain English Summary
Holds a defaulting auction purchaser who fails to deposit the balance purchase price strictly liable for any deficiency in price realized on resale together with resale expenses, recoverable as a deemed money decree.
Key Legal Elements
- Purchaser's Default: Failure to deposit 25% earnest money or 75% balance within 15 days.
- Deficiency on Resale: Difference between original high bid and lower bid fetched on second auction.
- Certification by Officer: Auctioneer certifies the shortfall and administrative resale expenses.
- Recovery as Money Decree: Recoverable directly from defaulting bidder without filing a separate lawsuit.
Practical Note
Enforcing Shortfall Against Defaulting Bidders: 1. Statutory Mechanism: When an auction purchaser defaults in paying the 75% balance under Rule 85, the court re-sells the property under Rule 86. If the property fetches less on the second sale (e.g., bid was ₹50 Lakhs originally, but only ₹35 Lakhs on re-sale), the ₹15 Lakh shortfall is recoverable directly from the first bidder under Rule 71 as if a money decree was passed against him! 2. Landmark Precedent: Ramana v. Nallaparaju AIR 1956 SC 87.
हिंदी पाठ
क्रेता के व्यतिक्रम (Default) के कारण पुनः विक्रय (Re-sale) पर कीमत में होने वाली कोई भी कमी (घाटा) और ऐसे पुनः विक्रय में होने वाले सभी व्यय विक्रय संचालित करने वाले अधिकारी द्वारा न्यायालय को प्रमाणित किए जाएंगे, तथा डिक्रीदार या निर्णय-ऋणी में से किसी की भी प्रेरणा पर व्यतिक्रमी क्रेता से उस प्रकार वसूल किए जा सकेंगे मानो वह धन के संदाय की डिक्री हो।