NEW RAHAT ENGINEERING WORKS Versus NATIONAL BANK OF PAKISTAN

ORDER

Through this application under section 12(2), Civil Procedure Code, the petitioners seek the setting aside of the order of this Court dated 26‑6‑2002 in E.F.A. NO‑534 of 2001, and the order of the learned Banking Court, Lahore, dated 26‑6‑2001.

2. Briefly stated the facts of the case are, that respondent No. 1/National Bank of Pakistan, filed a suit for recovery against the petitioners before the learned Banking Court, which was decreed to the tune of Rs.37,52,918, vide judgment and decree dated 29‑9‑1998. The properties mortgaged with the Bank were sought to be auctioned by the respondent No.1, and the learned Executing Court, appointed two Court Auctioneers to conduct the sale. Out of the two properties, property No.2 measuring 1 Kanal, 2 Marlas; situated at Mauza Sheesh Mehal Road, Ravi Road, Lahore, was put to auction and the amount fetched from the auction price, was enough for the satisfaction of the decree, therefore, the Property No.1 measuring 2 Kanals situated at Mauza Targarh, near Toll Tax Post Shahdara, Ravi Bridge, Lahore, was not required to be auctioned. The petitioners filed objections to the above, inter alia, on the ground of fraud, breach of law, as also misconduct on the part of the Court Auctioneers and violation of the terms and conditions of auction, which objections were rejected by the learned Executing Court, through the order dated 26‑6‑2001. It was held by the learned Executing Court, that "The judgment‑debtor was present at the time of auction which is duly signed by Nasir Ahmad judgment‑debtor No.2. Prior to the date of auction many efforts were made by the Court auctioneer to sell the property but same was not sold after auction. Anyhow prospective bidder has no value because he did not participate at the fixed time in the auction. In such circumstances I find no force in the petition so same is hereby dismissed". This order was challenged by the petitioners through E.F.A. No.534 of 2001 and a Division Bench of this Court came to the following conclusion;‑‑

"2. Before us, learned counsel for the appellant contends that the whole auction proceedings are based on fraud and have been conducted with material illegality and irregularity.

3. The auction took place in the presence of one of the judgment‑debtors namely Naseer Ahmad. The appellant has not offered to pay the decretal amount and the property has been sold in execution of the decree. The appellants' contention that the purchase‑money shown in the auction is much less than the actual price of the property is not tenable. Further the appellant contends that he has filed an application under section 12(2), Civil Procedure Code, therefore, the auction be set aside cannot be entertained, because mere filing of an application is no ground under the law to set aside the auction. The objection petition was dismissed vide order dated 26‑6‑2001, and thereafter the appellant moved an application with the prayer that he is ready to pay Rs.20 lacs in lump sum and regarding the remaining amount instalments be made and mark‑up be written off. Execution has already been held and the executing Court cannot be behind the decree."

3. Through this application, it is agitated that the auction proceedings were based upon fraud, inasmuch as the two properties are situated at a distance of 5 Kms. and both the properties were required to be auctioned the same day but at different times. The Property No. 1 was directed to be auctioned at 3‑00 p.m. while the other property at 4‑00 p.m., but instead of making an attempt to sell the first property, the Court Auctioneers had conducted the sale of the second property, and this is violative of the Court order and the terms and conditions of the sale.

4. We have heard the learned counsel for the petitioners and find no merit in the application, because the same allegations of fraud, had earlier been agitated by the petitioners in the objection petition, and they failed before the Executing Court; their appeal also was dismissed by this Court, as mentioned above. The submission, that some further elements of fraud, have been highlighted in the present application, resultantly, the dismissal of the earlier objection petition would not be a clog upon the maintainability of the present petition, suffice it to say, that the principles of constructive res judicata are applicable to the miscellaneous application also. If in the earlier application, the petitioners, though broadly had taken the objection of fraud, but if omitted to highlight the particular instances of the fraud, it would be deemed that such pleas were taken and had been rejected A by the Court. Moreover, if the petitioners in the earlier proceedings have failed to set out the particular fact to base a relief thereupon, these are the petitioners them selves, who have to be blamed and the principles of equity enunciated by Order II, rule 2, Civil Procedure Code, can be squarely applied to debar the petitioners in the present matter.

5. We are constrained to hold that the petitioners, one way or the other, with mala fide intent. are trying .to frustrate the proceedings of the confirmation of the sale made in favour of the auction‑purchaser. Moreover, the auction‑purchaser, who bought the property and in whose favour the sale has been confirmed, is a necessary party to this petition, but has not been impleaded as a party to the present petition.

6. In the light of what has been stated above, we do not find any merit in this application, which is hereby dismissed.

Q.M.H./N‑257/L Application dismissed.