Holding

A successful bidder’s right in a licitation is not a mere personal right; it is heritable and passes to the bidder’s heirs, and the licitation is not void for non‑payment absent a proper demand under Article 1417(c).

Summary

The case concerned inventory proceedings under the Portuguese Civil Procedure Code for the estate of a deceased person, where three immovable properties were to be partitioned. In a licitation (closed auction), Hermano, acting as Cabeca de Casal, was the highest bidder for Item No.1 but died before depositing the owelty amount. The question arose whether his right to the property and the obligation to pay owelty were personal rights that died with him or heritable rights that passed to his heirs. The High Court held that the right was heritable under Article 1737 and ordered re‑auction, a view affirmed by the Supreme Court. The Supreme Court clarified that Article 1417(c) requires a demand for payment before a licitation can be invalidated, and in the absence of such a demand the bidder’s heirs retain the right to the property and the duty to pay when demanded. Consequently, the appeals were dismissed.

Issues considered

The nature of the right of a successful bidder in a licitation: personal right extinguishing on death or heritable right passing to heirs.
Whether non‑payment of the owelty amount without a formal demand under Article 1417(c) invalidates the licitation.
Interpretation of Article 1737 regarding inheritance of rights and obligations arising from inventory proceedings.
Whether the heirs of the successful bidder can claim the auctioned property and are bound to pay the owelty when demanded.
Whether a re‑auction of the property is warranted under the Code.

Legislation cited

Portuguese Civil Procedure Codes. 1369, s. 1379, s. 1391, s. 1412, s. 1414, s. 1416, s. 1417(c), s. 1736, s. 1737, s. 2126, s. 2127

Subjects

inventory proceedingslicitationowelt yinheritanceCabeca de Casalheritable rightsPortuguese Civil Procedure Codeauctionpartitionsuccession

Judgment

[2022] 18 S.C.R. 115 115

MRS. ETHEL LOURDES D’SOUZA LOBO A
v.
LUCIO NEVILLE JUDE DE SOUZA & ORS.
(Civil Appeal No. 9202 of 2019)
SEPTEMBER 19, 2022 B
[S. RAVINDRA BHAT AND SUDHANSHU DHULIA, JJ.]
Portuguese Civil Procedure Code – Arts. 1369, 1379, 1391,
1412, 1416, 1417(c) & 1736, 1737, 2126, 2127 – Inventory
proceedings were initiated on account of death of ‘G’ and his wife
C
– These proceedings were initiated for partition of the estate of the
deceased – Estates comprised three items of immovable property –
Property in dispute is item no.1 – In licitation of the said property,
‘H’ gave the highest bid – ‘H’ was also Cabeca de Casal
(administrator) – He died – By then, he had not deposited any
amount towards bid offered by him – Claim for reauction was resisted D
by heirs of ‘H’, who contended they could continue the proceedings
and were entitled to item no. 1 – However, who supported reauction
contended that that H’s right to participate, and claim the specific
item of property, at the appropriate stage-when owelty was to be
demanded, was a mere personal right, which extinguished upon his
E
death – Held: In the instant case, it cannot be said that H’s right to
participate, and claim the specific item of property, at the appropriate
stage - when owelty was to be demanded, was a mere personal right,
which extinguished upon his death – The entitlement to bid in the
licitation process was not a personal right, but in his capacity as a
member of the family, of which he had been constituted as the Cabeca F
de Casal – If all other items are heritable by his heirs and legal
representatives (as there is no dispute that they are, because they
step into his shoes) an entirely different conclusion is unsupportable
in regard to the item of property for which he bid successfully, but
for which no demand was made, for payment of any amount – This
G
was because, the final chart of partition containing the excess
payments to be made, by one or other members of the family had
not been prepared; no demand for payment or deposit of owelty
was concededly made by any member of the family – However, that

H
115
116 SUPREME COURT REPORTS [2022] 18 S.C.R.

A did not mean that the highest bid by H was, in some inexplicable
manner, effaced – His position and right as a successful bidder,
and his obligation to pay the concerned amount, when called upon
to do so, were heritable by his heirs and legal representatives –
Appeals dismissed.
B Jose Paulo Coutinho v. Maria Luiza Valentina Pereira
& Ors. (2019) 20 SCC 85 : [2019] 12 SCR 390 ;
Zacarias Durate Domoingos Pereira v. Camilo Inacil
Evaristo Pereira, AIR 1984 Bom 295 ; T.S. Swaminatha
Odayar v. Official Receiver of West Tanjore [1957] 1
SCR 775 ; Baburao Karekar v. Vilas Atmaram
C Bandodkar (2015) 12 SCC 659 ; Motibai Sarvotham
Pai Cano & Ors. v. Maria Elsa Do Perpetuo Socorro
Mota & Ors. 1994(2) Bom. C.R. 628 ; Vasudev
Ramchandra Shelat v. Pranlal Jayanand Thakar [1975]
1 SCR 534 ; Umabai & Anr. v. Nilkanth Dhondiba
D Chavan (Dead) by L.Rs. & Anr. (2005) 6 SCC 243:
[2005] 3 SCR 521 ; Bhimrao Ramchandra Khalate
(Deceased) through L.Rs. v. Nana Dinkar Yadav
Tanpura & Ors 2021 (9) SCC 45 : [2021] 8 SCR 151 ;
Ashok Kumar Gupta and Anr. v. Sitalaxmi Sahuwala
Medical Trust and Ors. 2020 (4) SCC 321 : [2020] 2
E SCR 983 ; Amirtham Kudumbah v. Sarnam Kudumban
[1991] 2 SCR 389 – referred to.
Case Law Reference
[2019] 12 SCR 390 referred to Para 3
F [1957] 1 SCR 775 referred to Para 15
[1975] 1 SCR 534 referred to Para 22
[2005] 3 SCR 521 referred to Para 23
[2021] 8 SCR 151 referred to Para 23
G [2020] 2 SCR 983 referred to Para 23
[1991] 2 SCR 389 referred to Para 23

H
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 117
JUDE DE SOUZA & ORS.

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 9202 A
of 2019.
From the Judgment and Order dated 10.08.2012 of the High Court
of Bombay at Goa in Writ Petition No.671 of 2010.
With
B
Civil Appeal No. 9203 of 2019.
Ms. Vibha Datta Makhija, Sr. Adv., Keane Sardinha, Vibhuti
Sushant Gupta, Ram Naresh Yadav, Swetank Shantanu, Pratap Shanker,
Ankit Kumar, Jyoti Kumar Singh, R. Ayyam Perumal, Advs. for the
appearing parties. C
The Judgment of the Court was delivered by
S. RAVINDRA BHAT, J.
1. The present appeals arises from a judgment rendered by the
Bombay High Court, Goa Bench1. The dispute arises out of inventory D
proceedings2 under Chapter XVII by Articles 1369 to 1447 of the
Portuguese Civil Procedure Code (hereafter “the Code”).
2. Inventory proceedings in the present case arose and were
initiated on account of the death of Lt. Guilherme Caetano Souza and
his wife, Maria Guilhermina Augusta Lourdes Aguiar Souza. These E
proceedings were initiated in 1985 for partition of the estate of the said
deceased.3 There were six heirs of the deceased (hereafter referred to
by their names) - i.e., Pedro (survived by the petitioner, Ethel Lourdes;
and Respondent Nos. 23-26); Hermano (survived by the first four
respondents); Maria Emila Pulqueria Natividade (fifth respondent,
deceased and survived by her heirs – Respondent Nos. 6 to 11); Maria F
Patricia Lucia (deceased, survived by Respondent Nos. 12 to 21); Maria
Emilia Julieta (deceased); and Edwin (deceased). The estate in question
comprised, inter alia, three items of immovable property. Lt. Edwin,
one of the heirs, succeeded to two items (Nos. 2 & 3) of the properties,
1
In WP No. 671/2010 dated 10.08.2012 G
2
Described in Treatise of Civil Code, by Dr. Luis da Cunha Gonsalves, Volume X
page 590 as
“Inventory is a complete description of assets and debts or of the estate of
the inheritance and liabilities of the estate, in order that one or other, or the balance
remaining after payment of debts, be divided amongst the successors of the deceased,
or allotted to his sole heir.”
3
Inventory proceedings No. 109/1985/1 H
118 SUPREME COURT REPORTS [2022] 18 S.C.R.

A having bid highest among the heirs in an auction (licitation) held on
28.02.2001. The property in dispute is Item No. 1.
3. It is an undisputed fact that the Code is a comprehensive law,
incorporating both substantive and procedural elements, regarding various
matters, including those relating to personal laws, with elements of
B inheritance and succession to estates. The Code was initially framed in
1867; it became applicable as “law in force” upon assimilation of Goa
into the Indian Union by virtue of Section 5 (1) of the Goa, Daman and
Diu Administration Act, 1962.
4. When succession opens up to an estate, the properties (both
C movable and immovable) and liabilities of the deceased are inventorized.
In the inventory proceedings, an elder member of the family is appointed
as Cabeca de Casal (administrator). The administrator has to prepare
an inventory of all the properties of the deceased. The deceased’s
properties are inventorized and evaluated, after which they are to be
distributed in accordance with the shares laid down in the Code 4.
D
5. The steps following the above are that under Article 1369 of
the Code, the initial valuation of the property has to be settled by the
parties initiating the inventory proceedings. By Article 1387, the
concerned court, orders the appraisal of the properties by an appraiser,
where no questions (issues or disputes) are raised against the description
E or those so raised had been decided. The valuation stage would arise
when the licitation takes place, and parties offer the market value for
each property. After parties are intimated about the list of assets under
Article 1379, they or any of them have to apply for licitation. By Article
1391, if interested parties do not apply for licitation within 48 hours, the
F right is waived, and there can be no licitation. In such an event, the
property enlisted in the proceedings would be allotted to the interested
parties in accordance with their respective shares. Licitation, quite simply
is a closed auction, in which heirs of the deceased, entitled to shares in
the estate, participate. Licitation is provided by Article 1412; it reads as
follows:
G
“The licitation is an auction to which only the heirs and
moiety holder spouse are admitted, except the cases where,
in terms of preceding articles, the donee or legatee should
also be admitted. It may fall over the properties of the
4
H Ref Jose Paulo Coutinho v. Maria Luiza Valentina Pereira & Ors. (2019) 20 SCC 85
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 119
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J.]

inheritance which are not necessarily to be allotted in any A
particular party.”
6. Reverting to the facts of this case, on 28.02.2001, Item No. 1
too was part of the licitation; Late Maria Emilia Souza was the highest
bidder. Since she defaulted in the payment of the owelty amount, a fresh
bid was ordered. On 17.12.2004, the bidding in the second licitation B
commenced, and continued on to 03.01.2005 involving Item No. 1.
Hermano (represented by the first four respondents in this court) was
successful, with the highest bid for ` 34,15,100/-. Hermano had been
constituted as the Cabeca de Casal. He died on 11.07.2008. By then,
he had not deposited any amount towards the bid offered by him. At that
stage, the final partition chart had not been drawn. This fact was reported C
to the concerned court seized of the inventory proceedings. At the same
time, an application was moved by Adelaide M. De Souza (Pedro’s heir,
Respondent No. 26) for being impleaded as a party to the proceedings.
The present appellant also moved an application for the appointment of
a fresh Cabeca de Casal and reauction of Item No.1. D
7. The claim for reauction was resisted by Hermano’s heirs, who
argued that they could continue the proceedings and that they were
entitled to Item No.1. The Inventory court (or the trial court), by its
order5 allowed the appellant’s application citing Article 1417(c) of the
Code. The respondents had argued that the provision did not apply since E
the notice of payment of owelty amounts had not been made. The trial
court held that the property had to be reauctioned and since Hermano
had not deposited the sale proceeds within the time stipulated, and his
heirs could not claim ownership of the auctioned property, i.e., Item
No.1. It was further held that Hermano’s heirs could not succeed in
respect of the bid, because that was not a heritable item. This decision F
was appealed against, by Hermano’s heirs.
8. The District Judge, Margao, by its order6 reversed the ruling of
the inventory court and held that the effect of a successful bid was that
the successful bidder had a right to the property, which upon his death
devolved on his legal heirs. Being aggrieved by the decision of the District G
Judge, the appellant approached the High Court, which on the basis of
the materials on record concluded that the inheritance of an heir in
inventory contemplated under Section 1737 of the Code, included rights
5
dated 25.03.2009
6
dated 27.08.2010, in Misc. CA 87/2009. H
120 SUPREME COURT REPORTS [2022] 18 S.C.R.

A flowing from a successful bid in a licitation, as it included the right to pay
owelty. It was further held that the occasion for depositing the amount
towards auction would arise only after the amounts were apportioned
with regard to each heir’s share and only if the bid amount exceeded the
shares of the successful bidder in the inventory proceedings. It was
further held that the obligations and rights devolved upon legal successors,
B
i.e., present respondents. The court also held that the right of a successful
bidder could not be considered to be in personam so resulting in its
extinguishment after his death. To hold so, the High Court cited Article
1439 of the Code, which, in its opinion, confers a right in presenti upon
a successful bidder in an inventory proceeding to hold the property as an
C administrator.
Submission of parties
9. Mr. Keane Sardinha, learned counsel for the appellant, urged
that the findings of the first appellate court and the High Court, are
erroneous. It was argued that the rights conferred upon a successful
D bidder who is a party to inventory proceedings under Article 1737 do not
devolve upon his heirs on his death. The appellant urged that a bid in an
auction does not create any right or interest in the property, nor is there
a concluded contract between the bidders and other interested parties.
Consequently, no heritable right or legally enforceable right passes to
E the heirs of the deceased participant in a licitation proceeding. It was
submitted that there was no chart of partition determining the share of
owelty amounts in the proceedings, which meant none of the parties
could lay claim or demand their share of the price.
10. It was further submitted that the right to claim an asset through
F an auction can never be a heritable right, and is extinguished upon the
death of the bidder. In the present case, it was emphasized that Hermano
had expired much before the bid amount was paid. Consequently, the
auction had no legal effect. Relying upon Article 1417(c), it was submitted
that since no amount was in fact deposited, after licitation, even after
the successful bid, no rights could vest in Hermano’s heirs upon his
G death.
11. It was further stressed by Mr. Sardinha that in respect of the
same property, i.e., Item No.1, a previous auction – held in the year
2001 was deemed abortive on account of failure by the successful bidder
to deposit the owelty amount. In these circumstances, the same logic
H
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 121
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J. ]

had to prevail to oust any claim by Hermano’s heirs. Lastly, it was urged A
that the inventory proceedings had prolonged - since the auction in the
present case was held in 2005 and till his death Hermano did not wish to
fulfil his obligation. His heirs resisted the reauction, which would fetch a
higher amount for the property, and be fair and equitable to all heirs.
12. Ms. Vibha Dutt Makhija, learned counsel for the respondent B
submitted at the outset that this Court should not interfere with the
concurrent findings of the appellate court and the High Court. Learned
counsel submitted that inventory proceedings cannot be linked to partition
suits. They are meant to describe and apportion the estate of a deceased
person. Article 2064 to 2166 of the Code enacts substantive provisions,
whereas procedural provisions are contained in Articles 1369 to 1447. C
In this procedure, when licitation is held at the request of parties, specific
properties are earmarked after their comprehensive agreed valuation.
The parties then indicate the mode of partition which is ruled by the
court. It is after this process that the court prepares a chart of partition
indicating the inter se amounts to be paid by the parties to the inventory D
proceedings depending on their entitlement and shares, and having regard
to the adjustment of the manifest value of their shares with any obligations
on their part (such as the final amount payable after adjustment, as
successful bidders). It was submitted that in the present case, the stage
of final partition had not been reached. Consequently, the highest bid,
i.e., ¹ 34,15,100, could not be called the owelty amount payable by E
Hermano.
13. It was submitted that the court correctly held that the estate
of Hermano comprised not only of his rights and obligations but also his
right as a shareholder in the inventory proceedings – which included his
right as a successful bidder for Item No.1. In this regard, reliance was F
placed upon Article 1737, by the respondent in support of their
submissions.
Analysis and Conclusions
14. The provisions of the Code, to the extent they are relevant, G
are extracted below:
“Article 1736 (Concept of heir and legatee)
Heir is a person who succeeds to the totality of the
inheritance, or to a part thereof without specifying the sum
H
122 SUPREME COURT REPORTS [2022] 18 S.C.R.

A of money or the object. Legatee is a person, in whose favour
the testator disposes of a sum of money, or specified objects,
or a certain part thereof.
. Article 1737
The inheritance covers all the properties, rights and
B obligations of the author, which are not merely personal or
which are otherwise excepted by the disposition of the author
himself or by law.
*********** *********** ***********

C Sub Division V
Of the Licitation and Partition
Article 2126 (Form of partition and declaration of licitation)
After the description and appraisal is done, as aforesaid,
the parties shall be heard as to the form of partition, and if
D
any of them is willing to bid for any property or other object,
he shall so declare in his reply.
Article 2127 (Formalities of licitation and when to be held)
The licitation shall precede the act of partition, after all the
E parties are summoned, and it shall take place amongst them
only, as if it is a case of an auction.
Article 1416 (Chart of partition)
After the file is received with the order referred to in Article
1414, the office shall draw the chart of partition, within
F eight days, in accordance with the same order and in
accordance with the provision of the preceding Article.
For the purposes of the drawing of the chart, first of all, it
will be found what is the total amount of the assets, by adding
the values of each kind of properties as per appraisals and
G licitations and by deducting the passive debts, legacies and
charges which ought to be discounted; thereupon the
amount of the share of each party shall be worked out and
the part which is allotted to the party in each type of
properties; finally the allotment of each share will be done
with reference to the numbers of the items of the description.
H
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 123
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J. ]

The lots which are to be drawn by sortition shall be A
designated by letters.
Paragraph 1: The values shall be indicated by figures only.
The numbers of the items of the description shall be shown
in figures and by words and when they are continuous only
the terminal numbers between which the numbering is B
comprised shall be noted. In case some fraction of the items
fall to the coheirs, such fraction shall be mentioned.
Paragraph 2: In each lot the kind of properties of which it
is comprised shall be shown.
Paragraph 3: The judge shall initial each and every page C
of the chart and shall confirm the errata note of corrections,
erasures or interlineations.
Article 1417 (Steps to be taken when the gifted properties
or properties
D
subject of licitation exceed the share of the party)
Where the office finds, at the time of drawing the chart, that
the properties gifted or taken by licitation exceed the share
of the respective party or the disposable portion of the
deceased, a note shall be recorded in the file, in the shape
E
of a chart, indicating exactly what is the amount of the
excess, and thereupon the following shall be observed:
(a) Where in between the properties gifted to a co-heir there
exists any property not divisible, which does not fit wholly
in the share to the donee, such property shall form part of
F
the mass of partible properties as any other property of the
inheritance; in other cases, the donee shall be notified to
exercise, within three days, his right of choice which is
conferred upon him by paragraph 4 of Article 2107 of the
Civil Code, failing which his share will be allotted with the
properties indicated by the judge; G
(b) Where the gift made to a stranger is inofficious, the same
shall be reduced in terms of Article 1493 onwards of the
Civil Code;

H
124 SUPREME COURT REPORTS [2022] 18 S.C.R.

A (c) Those who have not taken the properties in licitation
and who are to be allotted the owelty money due by those
who were successful in the licitation, shall be notified to
demand within three days the payment, if they so desire. If
the demand is made the successful bidder shall be notified
to deposit the amount failing which the licitation will be of
B
no effect.
Where the payment is not demanded, the owelty money shall
earn the legal interest from the date of final judgment of
partition and the creditors thereof may register the legal
hypothecation over the properties adjudicated to the debtor.”
C
15. It is recognized that, unlike partition suits, inventory proceedings
under the Code are not essentially adversarial. In these proceedings,
initiated upon the death of one governed by the Code, that event is reported
to the Court. A Cabeca de Casal (administrator or head of the
household) is appointed by the Court, from amongst senior members of
D the family, to manage the properties of the deceased. When the
proceedings culminate after the apportionment of shares, there is no
decree.7 The Cabeca de Casal is enjoined to report all items of the
deceased’s estate - if there are bequests in testamentary instruments,
their description. Thereupon the items are sought to be divided: for that
E purpose, each item is valued. Those properties which cannot be divided,
are then the subject of licitation proceedings, where heirs are allowed to
bid for each item of those properties. The chart of partition is then
prepared, listing out the share and the value of shares of each heir.
Those who secure properties (through licitation, etc.) in excess of such
share have to pay owelty amounts. As to what is owelty, was explained
F by this Court in T.S. Swaminatha Odayar v. Official Receiver of West
Tanjore8 in the following terms:
“It therefore follows that when an owelty is awarded to a
member on partition for equalization of the shares on an
excessive allotment of immovable properties to another
G member of the joint family such a, provision of owelty
ordinarily creates a lien or a charge on the land taken under
the partition. A lien or a charge may be created in express
7
Ref. Zacarias Durate Domoingos Pereira v. Camilo Inacil Evaristo Pereira, AIR
1984 Bom 295
8
H [1957] 1 SCR 775
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 125
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J. ]

terms by the provisions of the partition decree itself. There A
would thus be the creation of a legal charge in favour of
the member to whom such owelty is awarded. If, however,
no such charge is created in express terms, even so the lien
may exist because it is implied by the very terms of the
partition in the absence of an express provision in that
B
behalf. The member to whom excessive allotment of property
has been made on such partition cannot claim to acquire
properties falling to his share irrespective of or discharged
from the obligation to pay owelty to the other members. What
he gets for his share is, therefore, the properties allotted to
him subject to the obligation to pay such owelty and there is C
imported by necessary implication an obligation on his part
to pay owelty out of the properties allotted to his share and
a corresponding lien in favour of the members to whom such
owelty is awarded on the properties which have fallen to
his share.”
D
16. Owelty, then, is awarded to a member in proceedings of partition
for equalization of the shares on “an excessive allotment of immovable
properties to another member.” The total amount which has to be
distributed to the heirs as per their shares, therefore, includes inter alia,
on the owelty sums paid in, by one who can claim entitlement to immovable
property in excess of the share allocable to her or him. E

17. One of the earlier decisions of the Bombay High Court in
Shri Damodar Ramnath Alve v. Shri Gokuldas Ramnath Alve & Anr. 9
explained the stage of payment of owelty:
“23. Article 1417 refers to the steps to be taken when the F
gifted property or properties subject of licitation exceed the
share of the party. Clause (c) of Article 1417 reads as
under:-
“c) Those who have not taken the properties in licitation
and who are to be allotted the owelty money due by those G
who were successful in the licitation, shall be notified to
demand within three days the payment, if they so desire. If
the demand is made the successful bidder shall be notified

9
1997 (4) Bom CR 653
H
126 SUPREME COURT REPORTS [2022] 18 S.C.R.

A to deposit the amount failing which the licitation will be of
no effect.”
In the instant case the demand was made and notice was
issued on 4th January 1989. Thus, from this day period of
5 days begins. He filed an application dated 12th January
B 1989, stating therein that he be exempted from the payment
of owelty money until the decision of Civil Suit No. 202/
1986/A and same came to be dismissed on 18th February
1989. On 27th February 1989, appellant Damodar filed
another application stating that challans be issued to him
to deposit the owelty money. Challans were handed over to
C him on 28th February 1989. However, by filing applications,
the period is not extended. The appellant Damodar failed
to deposit the money within 5 days and, therefore, Damodar
no more remained a successful bidder. His right was
extinguished.”
D 18. It is clear that the question of paying owelty, or any amount,
by any heir, including one who bids successfully for an item, is dependent
upon a demand by one or the other heirs. This point was brought home,
highlighting the need for making a demand, in another decision of the
Bombay High Court, i.e., Motibai Sarvotham Pai Cano & Ors. v.
E Maria Elsa Do Perpetuo Socorro Mota & Ors.10 where the court
held as follows:
“A look at the provision of Article 1417 clearly suggests
that for failure to pay owelty money the creditor is entitled
to legal interest from the date of judgment until recovery
F and is further entitled to register a sort of mortgage in respect
of the property when demand is not made. It is therefore
clear that failure to pay money does not bring about the
reversion of the property. But, in a case where the demand
is made by the person who is entitled to receive owelty and
if the same is not paid within three days of the notice of
G demand, the allotment becomes ineffective and the property
be put to re-auction and at that re-auction the defaulting
party is not entitled to participate and offer any bid.”

10
1994 (2) Bom. C.R. 628
H
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 127
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J. ]

In Ranjit Satardekar v. Clotildes Fernandes it was held as A
follows:11
“14. In my view, article 2137 of the Civil Code does not
confer any substantive right on a party. It deals with aspects
of procedure regarding payment of auction price. It was
contained in the law enacted in 1867. The C.P.C., as already B
stated, was enforced w.e.f. 1/01/1941 and in the light of
new provisions having been made subsequently as to when
the payment is to be demanded and by whom and to whom
and the consequences which should follow in case of failure
to deposit, the provisions of Article 2137 of the Civil Code,
in my view would stand impliedly repealed and substituted C
by the provision of Article 1417(c) of C.P.C. Admittedly, the
appellants were notified to demand the payment as
contemplated by Article 1417(c) but did not insist that the
same should be made and in the light of that the appellants’
challenge to the chart of partition, prima facie, cannot be D
accepted. It also does not make much sense that the highest
bidder should be asked to deposit the entire price of the bid
when his own share in the bided property is substantial.
The view that the provision of article 2137 of the Civil Code
stands impliedly repealed and now article 1417 C.P.C.
overrides article 2137 of the Civil Code is a view held by E
learned authors Fernando Andrade Pires de Lima and Joao
De Matos Antunes Varela reproduced herein above. It is also
the view held by Supreme Court of Portugal in its decision
dated 9/04/1957 in File No. 56.939 wherein the Supreme
Court stated: F
‘article 2126 and following of the Civil Code today is in a
great part substituted by the respective provisions of the
Code of Civil Procedure’…”
19. This court too has endorsed the view expressed by the Bombay
High Court on the subject, in Baburao Karekar v. Vilas Atmaram G
Bandodkar 12.

11
Civil Application No. 294 of 2007 in First Appeal No. 289 of 2006, decided by
Bombay High Court on 14.02.2008
12
(2015) 12 SCC 659 H
128 SUPREME COURT REPORTS [2022] 18 S.C.R.

A “II. Article 1417(c) of the Portuguese Code translated by
Mr M.S. Usgãocar in Family Laws of Goa Daman & Diu
‘(c) Those who have not taken the properties in licitation
and who are to be allotted the owelty money due by those
who were successful in the licitation, shall be notified to
B demand within three days of the payment, if they so desire.
If the demand is made the successful bidder shall be notified
to deposit the amount failing which the licitation will be of
no effect.
Where the payment is not demanded, the owelty money
C shall earn the legal interest from the date of final judgment
of partition and the creditors thereof may register the legal
hypothecation over the properties adjudicated to the debtor.’
III. Comments by noted Portuguese jurist Joao Antonio
Lopes Cardoso, in his book Judicial Partitions — Theory
D and Practice, Vol. 2, Edn. 1955 on Article 1417
‘If the Registry finds, when preparing the chart, that
the assets taken in the auction exceed the share of the
respective interested party, it shall make a memo in the form
of a chart stating precisely the amount of the excess. [Article
E 1417 of the Portuguese Code of Civil Procedure]
Thereafter, those who did not offer any bid or rather
those who receive less, to whom owelty money is due by the
highest bidders or by those who have exceeded their
respective share, shall be notified to demand the payment
F within three days, if they so wish.
If they make a demand, the highest bidder or the person
who has been allotted in excess shall be notified to deposit
the owelty money under pain of the auction becoming
ineffective. [Article 1417 clause (c) of the Portuguese Civil
Procedure Code.]’”
G
10. Though the learned counsel for the parties have urged
different meanings to the translated versions to further their
respective cases, on close scrutiny, we do not find any
variance in the meanings of the translated provisions of the
Code. In fact, according to us, the purport and meaning of
H
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 129
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J. ]

Article 1417(c) is clear and unambiguous. After a chart of A
partition is drawn up and approved by the court, under
clause (c) of Article 1417, a duty is cast on the court to
identify all the parties who had not taken part in the family
auction/licitation and ensure service of notice on such
person(s) so that within 3 days of receipt of such notice, the
B
said parties i.e., creditors can raise a demand for payment,
if they so wish. Once such a demand is raised the auction-
purchaser/successful bidder is duty-bound to pay the
amount, failing which the licitation will cease to have any
legal effect. No time-limit for payment by the auction-
purchaser is specified. It is in the aforesaid backdrop of the C
provisions of the Code that the court will be required to
examine the rival stand of the parties as projected before
us in the present appeal.
11. Admittedly, in the present case, no notice was issued by
court to the creditor(s) to raise any demand for payment as D
required under Article 1417(c) of the Code. The High Court
has proceeded on the basis that the reply filed by the
respondent before the learned trial court on 26-6-2008
constitutes such a demand and further that within 3 days
thereof payment was not made by the appellants thereby
vitiating the auction proceedings. Even if we are to proceed E
on the aforesaid basis insofar as the demand of the
respondent is concerned, the alleged failure on the part of
the appellants to deposit the amount within 3 days could
not have occasioned a default to vitiate the auction
proceedings, as held by the High Court. Article 1417(c) does F
not contemplate invalidity of the licitation on failure to
deposit the amount demanded by the creditor within 3 days.
The period of 3 days has been stipulated for raising a
demand by the creditor after such creditor receives the notice
that he may raise a demand for payment. If Article 1417(c)
is to be read in the manner indicated above we do not see G
how the High Court could have held the auction proceedings/
licitation to have been vitiated on the alleged failure of the
auction-purchaser/appellants to pay the amount within 3
days. In any case, the “demand” made in the reply dated
H
130 SUPREME COURT REPORTS [2022] 18 S.C.R.

A 26-6-2008 is not pursuant to any notice issued under Article
1417(c) of the Code.
12. All the above facts lead us to the conclusion that the
High Court was not correct in holding that in the present
case the licitation was rendered invalid as there had been a
B failure on the part of the appellant to pay the amount
demanded by the respondent as required under Article
1417(c) of the Code. The conclusions recorded by the High
Court in the impugned order are plainly untenable and would
justify interference.”
C 20. It is, thus, obvious that upon successfully bidding in an auction,
the amount to be paid in by the concerned heir is payable upon a demand
by any other heir to such bidder, asking for the amount to be deposited.
The limitation period, so to say, is dependent upon the demand so made.
The rationale for this rule is that till the amount in excess of such bidder’s
share is not computed, they remain in the dark about the sum to be paid.
D In the present case, it is not disputed by the appellant that such a demand
was not made; the parties were not notified as to the amounts they were
entitled to; or that the respondent did not make the demand. For this
reason, this court is not persuaded by the submissions of the appellant.
21. As far as the rights of Hermano’s heirs to succeed to his
E entitlement to the item bid for is concerned, the appellant’s argument
was that the right to receive such property was conditional or contingent
upon his depositing the entire bid amount; since he did not do so, the
heirs cannot inherit some vague inchoate right. A perusal of Article 1737
of the Code reveals that it is cast in wide terms; it declares that the
F “inheritance” covers “all properties, rights and obligations of the
author, which are not merely personal or which are otherwise
excepted by the disposition…” Concededly Hermano was an heir,
entitled to a share in the estate of the deceased. Upon his death, that
share would devolve on the heirs. The question then is whether
Hermano’s entitlement to claim a particular item upon payment of owelty,
G when demanded, is “property” or a “mere personal right.”
22. What Article 1737 provides for is that inheritance, or the estate
of a deceased, comprises of all properties, rights, and obligations which
are not personal or otherwise excepted from disposition. Thus, the concept
of inheritance is wide and embraces all rights and obligations, including
H
MRS. ETHEL LOURDES D’SOUZA LOBO v. LUCIO NEVILLE 131
JUDE DE SOUZA & ORS. [S. RAVINDRA BHAT, J. ]

property. Now, property itself is a wide term; it includes corporeal and A
incorporeal property, movables and immovable property, intellectual
property (which are essentially negative rights, in the form of legal
enclosures that the owner is entitled to, to prevent use by others). Rights
and entitlements are even wider concepts. In Vasudev Ramchandra
Shelat v. Pranlal Jayanand Thakar13 this court approved the view
B
that delivery of shares, with share transfer forms, which led to rights to
get the shares registered, was property:
“We think that such a right is in itself “property” and
separable from the technical legal ownership of the shares.
The subsequent or “full rights of ownership” of shares would
follow as a matter of course by compliance with the C
provisions of Company law. In other words, a transfer of “
‘property” rights in shares, recognised by the Transfer of
Property Act, may be antecedent to the actual vesting of all
or the full rights of ownership of shares and exercise of the
rights of shareholders in accordance with the provisions of D
the Company law.”
23. The other manner of examining the issue is whether Hermano’s
rights were “personal rights”. A right to claim specific performance of
an agreement to sell has been held to be a personal right in Umabai &
Anr. v. Nilkanth Dhondiba Chavan (Dead) by L.Rs. & Anr.14 and E
Bhimrao Ramchandra Khalate (Deceased) through L.Rs. v. Nana
Dinkar Yadav Tanpura & Ors15. Similarly, the claim of a trustee against
another co-trustee is a personal right, per Ashok Kumar Gupta and
Anr. v. Sitalaxmi Sahuwala Medical Trust and Ors.16; and in Amirtham
Kudumbah v. Sarnam Kudumban17, it was held that the right to impeach
a sale effected by a minor’s guardian is a personal right vested in the F
minor which is not transferable.
24. In the present case, it cannot be said that Hermano’s right to
participate, and claim the specific item of property, at the appropriate
stage - when owelty was to be demanded, was a mere personal right,
which extinguished upon his death. The entitlement to bid in the licitation G

13
1975 (1) SCR 534
14
(2005) 6 SCC 243
15
2021 (9) SCC 45
16
2020 (4) SCC 321
17
1991 (2) SCR 389 H
132 SUPREME COURT REPORTS [2022] 18 S.C.R.

A process was not a personal right, but in his capacity as a member of the
family, of which he had been constituted as the Cabeca de Casal. If all
other items are heritable by his heirs and legal representatives (as there
is no dispute that they are, because they step into his shoes) an entirely
different conclusion is unsupportable in regard to the item of property
for which he bid successfully, but for which no demand was made, for
B
payment of any amount. This was because, the final chart of partition
containing the excess payments to be made, by one or other members of
the family had not been prepared; no demand for payment or deposit of
owelty was concededly made by any member of the family. However,
that did not mean that the highest bid by Hermano was, in some
C inexplicable manner, effaced. His position and right as a successful bidder,
and his obligation to pay the concerned amount, when called upon to do
so, were heritable by his heirs and legal representatives.
25. For the foregoing reasons, the impugned judgment of the High
Court is sound. The appeals are therefore, without merit, and,
D consequently, dismissed without an order on costs.

Ankit Gyan and Anurag Bhaskar Appeals dismissed.
(Assisted by : Rahul Kumar, LCRA)

E

F

G

H