Execution

Assignment

Under the guidance

Of
Prof. Adv. Vivek Salunke

Submitted By: Kunal Dalvi

Roll no: 213018

Class: T.Y. LL.B

Signature:

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 Index

Sr.no. Content Pg no.

1. General & Meaning 3-11

2. Procedure in execution 12-13

3. Modes of Execution 14-16

4. Stay of Execution 17-18

5. Distribution of Assets 19-22

6. Special Provisions 23-25

Regarding Arrest &
Detention

7. Special Provisions 26-37

Regarding Attachment of
Property

8. Special Provisions 38-47

Regarding Sale of Property

9. Bibliography 48

General and Meaning

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The provisions of the Civil Procedure Code relating to execution of decrees and orders
run into about forty sections (Ss. 36 to 74) and 106 rules (in order XXI). The litigation
consists of three stages, initiation of litigation, adjudication of litigation, and
implementation of litigation. The last stage of litigation, which is the implementation of
litigation, is known as an execution.

Once a decree or judgment is passed by the court, it is the obligation of the person
against whom the judgment is passed (judgment-debtor), to give effect to the decree so
as to enable the decree-holder to enjoy the benefits of the judgment.

By execution, a judgment-debtor is compelled to carry out the mandate of the decree or

order. Execution implies giving effect to an order or judgment of a court of justice. When
the decree-holder gets the thing granted to him by judgment, decree or order, the
execution is complete.

The term “execution” is not defined in the CPC. The term “execution” means
implementing or enforcing or giving effect to an order or a judgment passed by the court
of justice. In simple words “execution” means the process of enforcing or giving effect to
the decree or judgment of the court, by compelling the judgment-debtor to carry out the
mandate of the decree or order and enable the decree-holder to recover the thing
granted to him by judgment.

Illustration: X files a suit against Y for Rs 20,000 and obtains a decree against him.
Here X would be called the decree-holder, Y is the judgment-debtor, and the amount
of Rs 20,000 is the judgment- debt. Y is bound to pay Rs 20,000 to X, as the decree is
passed against him. Suppose Y refuses to pay the decretal amount to X, X can recover
the said amount by execution through the judicial process.

Courts which passed a decree

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Under S.37 of the code, the expression “Court which passed a “decree” includes-

(a) where the decree to be executed has been passed by an Appellate Court, the Court
of the first instance: and

(b) where the Court of the first instance has ceased to exist or to have jurisdiction to
execute it, the court which, if the suit (where the decree was passed) was instituted at
the time of making the application for execution of the decree, would have jurisdiction to
try such a suit.

The object of S.37 is to avoid the cumbersome procedure which would result if the court
which actually passed the decree is to be the only court which can execute it. It may be
noted that it is the court of the first instance that is to execute the decree. Thus, an
appellate decree of the Supreme Court is to be executed by the court of the first
instance, and not by the High Court to which the decree is transmitted by the Supreme
Court.

Formerly, there was a conflict of decisions on whether, in cases where jurisdiction over
the subject-matter of a decree was transferred to another court; such other court was
also competent to entertain an application for the execution of the decree. The Calcutta
High Court has held that, in such cases, both courts had jurisdiction to do so, whereas
the Madras High Court had held that a court to whose jurisdiction the subject-matter had
been transferred had no jurisdiction to do so. This controversy was set at rest by the
1976 Amendment, which gives legal sanction to the view of the Calcutta High Court,
that in such cases, both the courts can execute such a decree

Executing Court cannot go behind the decree

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Section 38 of the Code states that a decree can be executed either by the Court of the
first instance or by the Court to which it has been sent for execution.

A court executing a decree cannot go behind the decree and must execute it as it
stands. The executing court has no power to entertain any objection as to the validity of
the decree or as to the legality or correctness of the decree, as for instance, an
objection that the decree sought to be executed was passed against a wrong person or
that it was passed against a lunatic or a minor who was not properly represented.
(Kalipada V. Hari, 1947 44 Cal. 627)

Transfer of decree

Section 39 provides that when a decree-holder makes an application to the court of the
first instance to send the decree for execution to another court, the court of first instance
may do the same if any of the following grounds exist:

a) if the judgment-debtor carries on business, or resides or personally works for

gain, within the jurisdiction of such Court;

b) if the property of judgment-debtor does not come under the jurisdiction of the
Court of the first instance but it comes under the local limits of the jurisdiction of
such Court;

c) if the decree directs delivery or sale of immovable property situated outside the
jurisdiction of the Court which passed the same;

d) if the Court which had passed the decree considers that the decree should be
executed by another court, but it shall record the reasons in writing for doing the
same

Section 39(2) states that the Court of the first instance may suo motu send it for
execution to any subordinate Court of competent jurisdiction.

The Section further states that if the execution of the decree is against a person or
property outside the territorial jurisdiction of the court passing the decree, then such
Court has no power to execute the decree.

If a decree is sent for execution to another state, it must be sent to such court, and be
executed in such manner as may be prescribed by the rules in force in that state.
(S. 40)

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Rules 5 and 6 of O. XXI provide that if a decree is to be sent for execution to another
court, irrespective of whether such other court is or is not situated in the same state. If
this court (to which the decree is sent) has no jurisdiction to execute the decree, it must
send it to the court having such jurisdiction.

When a court sends a decree for execution to another court, it must send the following
three documents:

(a) a copy of the decree

(b) a certificate that the decree is not satisfied by execution (or, if it is executed in part,
the extent to which satisfaction has been obtained)

(c) a copy of the order for execution of the decree (or, if no such order has been made,
a certificate to that effect)

Under S.42, the court executing a decree sent to it has the same powers in executing
such a decree as if the decree had been passed by itself. Thus, all persons disobeying
or obstructing the execution of such a decree are punishable by the executing court in
the same manner as if it had itself passed the decree. Likewise, the orders of such a
court in executing such a decree are also subject to the same rules in respect of appeal,
as if the decree had been passed by that court itself.

Therefore, the court to which a decree is sent for execution also enjoys the following
three powers:

(a) power to send the decree for execution to another court under section 39,

(b) power to execute the decree against the legal representatives of the deceased
judgment-debtor under section 50,

(c) power to order attachment of a decree

However, such a court does not have the following powers, namely-

(i) power to order execution at the instance of the transferee of the decree,

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(ii) in the case of a decree passed against a firm, power to grant leave to execute such
a decree against any person, except-

(a) a person who has appeared as a partner or who has admitted that he is a partner, or

(b) a person who has been individually served as a partner with a summons, but has
failed to appear.

Whether a transferee court can transfer the decree to another court for execution

Before the 1976 Amendment of the code, the courts had taken the view that since the
jurisdiction of the transferee court was limited to the execution of the decree transferred
to it, it could not again transfer the decree for execution to another court. However, this
view can no longer hold good after the 1976 Amendment, since Section 42 now
expressly confers the power on the transferee court to send the decree for execution to
another court.

Provisions are also made in the code for execution of-

(a) decrees passed by a civil court in India to which civil procedure code does not
extend or to any court established by the Central Government outside India (S. 43)

(b) decrees passed by Revenue courts in any part of India to which the civil procedure
code does not extend (S. 44)

(c) decrees passed by superior courts of a reciprocating territory, i.e., any country or
territory outside India which is declared by the Central Government to be a reciprocating
territory for this purpose. (S. 44A)

Precepts

S.46 of the code provides that the court which passes a decree may, on the application
of the decree-holder, issue a precept to any other court which would be competent to
execute such decree, to attach any property belonging to the judgment-debtor and

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specified in the precept. The court to which such a precept is sent must then attach the
property in the same manner as property is to be attached in execution of a decree

It will be noticed that a precept is thus an order or direction given by one official body to
another (in this case by one court to another), requiring some act to be done.

However, no attachment under a precept can continue for more than two months,-

(i) unless the period of attachment is extended by the court which passed the decree;

(ii) unless before the termination of such attachment, the decree has been transferred to
the court by which the attachment has been made and the decree-holder has applied
for an order for the sale of such property.

Thus, an order for permanent attachment under a precept would be illegal

The object of S.46 is to enable the attachment of the property of the judgment-debtor by
another court in order to prevent the judgment-debtor from alienating or otherwise
dealing with such property to the detriment of the decree-holder, till proper proceedings
for sale of the property can be taken. An attachment under this section is merely a step
taken to facilitate execution; it is not a step taken in the proceedings in execution

Where a decree-holder desires to execute the decree by attachment and sale of the
judgment-debtor's property situated beyond the jurisdiction of the Court passing the
decree, such a Court cannot execute it. In such a case, the decree-holder has to apply
to the Court passing the decree to transfer it to the Court within whose jurisdiction the
property to be attached and sold is situated. Pending the decision of the application for
transfer, the decree-holder may obtain an interim attachment where there are grounds
to apprehend that the judgment-debtor may alienate his property and deprive the
decree-holder of the fruits of his decree.

Also, where a precept is applied for under section 46, it is not open to the Court issuing
it to attach such property itself. Moreover, this section applies to matters which arise
after a decree has been passed; hence, it cannot be invoked in aid of an application for
attachment before judgment under O. 38, R. 5. Lastly no attachment can be effected
under this section where the properties are situated outside India.

Questions to be determined by the executing court

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S.47 of the code provides that all questions arising between the parties to the suit in
which the decree was passed, or their representatives and relating to the execution,
discharging or satisfaction of the decree are to be determined by the court executing the
decree, and not by a separate suit.

Likewise, if a question arises as to whether any person is or not this representative of a

party to the suit, such a question is also go be determined by the executing court.

It is also clarified that a purchaser of property at a sale in execution of a decree is to be

deemed to be a party to the suit in which the decree is passed.

Conditions for the application of S.47: In order the section 47 may apply, the
following three conditions must be satisfied;

(1) The question must be one arising between the parties to the suit in which the decree
is passed, or their representatives. The words 'between the parties' do not necessarily
mean parties on opposite sides as plaintiff and defendant, but also cover parties
opposed to each other in the suit. Thus, in a partition suit, parties who are co-
defendants are often arrayed against each other. But a dispute between the
representatives of the same party will not fall within the section.

(2) Such a question must relate to the execution, discharge or satisfaction of the decree

(3) The order must be one passed by the court executing the decree

Questions relating to execution, discharge or satisfaction

The following are instances of questions relating to execution, discharge or satisfaction

of the decree:

(a) When property is wrongly taken in execution: if the decree-holder takes in

execution, land which is not included in the decree or in excess of the decree, the
judgment-debtor must apply under this section for the recovery of such land, and a
separate suit for that purpose will not lie.

(b) Property taken in execution of an ex-parte decree which is set aside: if property
is realized in execution of an ex-parte decree which is afterwards set aside, the
judgment-debtor must apply for restitution under this section. He cannot file a separate
suit for the purpose.

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(c) Injunction granted by a decree: a suit to enforce a permanent injunction granted
by a decree is barred by this section. The remedy in such a case is by way of execution
of the decree.

(d) Decree on compromise of suit: if a suit in a compromise decree, a subsequent

suit to enforce a term in the decree which did not relate to any matter raised by any of
the issues in the suit is barred by S.47

(e) Agreement to give time: a fair bargain for giving more time in consideration of a
reasonable rate of interest has an effect upon the rights of a party under a decree, and
the executing court would have jurisdiction under this section to ascertain its legal
effect, and pass an order accordingly

Questions not relating to execution, discharge or satisfaction

If the question arising between the parties does not relate to the execution, discharge or
satisfaction of the decree, S.47 does not apply and a separate suit can be maintained,
as in the following cases:

(a) Questions as to the validity of the decree: a court executing the decree has no
power to go behind a decree and question its validity. Therefore, a suit to set aside a
decree as invalid is not barred by S.47, as this section refers to cases where the
satisfaction of the decree, as distinguished from its validity, is in question

(b) Maladministration of judgment-debtor’s estate: a decree-holder who fails to

realize his decree by execution against the executor of the judgment-debtor, may file a
suit against the executor for the administration of the estate and for accounts, on the
footing of maladministration

(c) Payment before decree: when a decree is being executed, it is not open to the
judgment-debtor to contend that he should get credit for the amount paid before the
decree.

(d) Second suit for redemption: if a mortgager is, in effect, bringing a suit to execute a
previous mortgage-decree for redemption, the suit would be barred under S.47. If,
however, the right to redeem was reserved to him by the decree in the previous suit, a
fresh suit for redemption can be filed.

Transferee of a decree

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Under S.49 of the code, every transferee of a decree holds the same subject to the
equities (if any) which the judgment-debtor might have enforced against the original
decree-holder

The principle underlying this provision is that the assignee of a claim stands in the same
position as the assignor, as regards equities existing between the assignor and his
debtor at the time of the assignment. Thus, A holds a decree against B for 5,000. B
holds a decree against A for ₹ 3,000. A transfers his decree to C. Here, C cannot
execute the decree against B for more than 2,000.

Similarly, A obtains a decree against B for 5,000. B then sues A to recover 2,000.
Pending B's suit, C obtains a transfer of A's decree with notice of B's suit. A decree is
then passed in favor of B in his suit against A. C applies for execution against B for the
entire amount of * 5,000. Here, he is not entitled to execute the decree for more than
3,000 as the transfer was taken with notice of B's suit.

Legal representatives

S.50 of the Code provides that if a judgment-debtor dies before the decree has been
fully satisfied; the holder of the decree may apply to the Court which passed it to
execute the same against the legal representative of the deceased.

When such a decree is executed against such a legal representative, he is liable only to
the extent of the property of the deceased which has come to his hands and has not
been duly disposed of; and for the purpose of ascertaining such liability, the Court
executing the decree may, of its own motion, or on the application of the decree-holder,
compel such legal representative to produce such accounts as it thinks fit.

The term "legal representative" is defined (by S. 2) to mean a person who in law
represents the estate of a deceased person, including any person who intermeddles
with the estate of the deceased.

Procedure in execution

Section 51 to 54 of the Code talks about the procedure in execution

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Section 51

The section states the jurisdiction and power of the court in executing a decree. An
application for execution of the decree can either be oral or written. The court may
execute decree as per the mode of implementation prayed by the decree-holder or as
the court deems fit.

Mode of executing decree

 By delivery of any property (movable or immovable) specifically decreed.

 By sale of the property with or without the attachment of the property. If the
property is situated within the jurisdiction of the court then it has the power to
attach the property.

 By arrest and detention. However, this mode should not be exercised without
giving a reasonable opportunity to the judgment-debtor, in the form of a show-
cause notice as to why he should not be imprisoned.

 Execution by appointing a receiver

 If any other mode apart from the ones mentioned in clause (a) to (c) needs to be
used in the execution of a decree then clause (e) comes into play.

Section 52

This section deals with the cases where the decree is passed against the legal
representative of the judgment-debtor (deceased). So long as the property of the
deceased remains in the hands of a legal representative, a decree can be executed

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against the property, if it is for the payment of money out of the property of the
deceased and if the decree has been passed against the party as the legal
representative of the deceased person

In a situation where the property which is in the possession of the judgment-debtor

came in the hands of the legal representative and it has not been duly applied by him,
the court will enforce the execution of the decree against him as if the decree was to the
extent passed against him personally.

Section 53

The Section states that when a property is liable for payment of a debt of a deceased
ancestor and it is in the hands of a son and descendant, then the property will be
deemed to be of the deceased which has as his legal representative come into the
hands of the son or other descendants.

Section 54

When a decree has been passed for partition or for the separate possession of a share
of an undivided estate for the payment of revenue to the government, this section
comes into play. The partition of the estate or share needs to be made by the collector,
but if the collector denies making the partition of the revenue paying property, then the
civil court can do so. To attract the provisions of this section, the plaintiff asking for the
division of government revenue is not deemed as an essential condition.

Powers of the transferor court

Once a court which has passed a decree and transferred it to another court of
competent jurisdiction, it would cease to have jurisdiction over that decree and it cannot
execute the decree. Then, only the transferee court can entertain an application for
execution.

Modes of Execution

1. Attachment of Property: This is one of the most common modes of execution. It

involves attaching (seizing) the movable or immovable property of the judgment

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 debtor to satisfy the decree (court order). The attached property may eventually be
sold, and the proceeds are used to satisfy the judgment debt.

2. Warrant of Arrest: In some cases, the court may issue a warrant for the arrest of
the judgment debtor. This is typically used when the judgment debtor has failed to
appear in court or to comply with a court order. The debtor may be detained until the
decree is satisfied or until they comply with the court's order.

3. Attachment of Salary or Wages: This mode of execution allows for the attachment
of a portion of the judgment debtor's salary or wages. The employer is ordered to
deduct and remit the specified amount to the court to satisfy the decree.

4. Decree against a Firm or HUF: If the judgment debtor is a partnership firm or a

Hindu Undivided Family (HUF), the CPC provides for specific modes of execution
against these entities. This can include attaching the property or assets of the firm or
HUF.

5. Decree against Government: When a decree is to be executed against the

government or a public officer, special procedures apply. Typically, the judgment
creditor must obtain a certificate from the court for the amount due, which is then
presented to the government for payment.

6. Decree for Delivery of Property: In cases where the decree requires the delivery of
specific movable property, the court can enforce the decree by directing the
judgment debtor to deliver the property to the judgment creditor.

7. Appointment of Receiver: The court may appoint a receiver to manage and collect
income from the property or assets of the judgment debtor. The receiver's role is to
ensure that the decree is satisfied.

8. Execution of Decrees for Restitution: When a decree is reversed or varied, the

court can order restitution, which involves restoring to the judgment debtor any
benefits they may have lost due to the erroneous decree. This includes the return of
any property or compensation for losses suffered.
9. Specific Relief: In cases where a specific performance of a contract is ordered, the
court can issue necessary orders and directions to ensure compliance with the
decree.

10. Compromise or Settlement: If the parties reach a settlement or compromise after

obtaining a decree, the court can pass a compromise decree and enforce it
accordingly.

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Rules 30 to 36 of Order XXI which lay down the mode of execution of various types of
decrees may be summarized as follows:

A decree for payment of money, including a decree where payment of money is an

alternative to some other relief, can be executed by the detention of the judgment-
debtor in the civil prison or by attachment and sale of his property or both (R. 30)

A decree for a specific movable property (or for a share in a specific movable property)
can be executed by seizure of such property (if that is practicable) and delivery thereof
to the decree-holder or by the detention of the judgment-debtor in the civil prison or by
attachment of his property or by both detention and attachment. (R. 31)

In such a case, if the attachment has remained in force for three months and the
judgment-debtor has not obeyed the decree, the decree-holder can apply to the court
for sale of the attached property. If the court orders such a sale, the court may award to
the decree-holder, out of the proceeds of the sale, the amount fixed by the decree to be
paid as an alternate to the delivery of movable property. If no such amount is fixed by
the decree, the court may award to the decree holder, such amount as it deems fit.

On the other hand, if the judgment-debtor has obeyed the decree or if at the end of
three months from the date of attachment, no application is made to the attachment
comes to an end

If a decree for restitution of conjugal rights has been passed and the party against
whom it is passed willfully to obey it, although he has had an opportunity of obeying it,
the decree may be enforced by the attachment of his property. (R. 32)

If the decree for restitution of conjugal right is against the husband, the Court may also
order that if the husband does not comply with the decree within such time as may be
prescribed, he shall make periodical payments to the wife of such amounts as may be
fixed by the Court. The amount of payment and the intervals fixed for payment thereof
may also be varied or modified by subsequent orders of the Court. Such amounts can
be recovered by the wife as if they were payable under a decree passed for the
payment of money (R. 33)

If the decree is for the delivery of any immovable property, possession of such property
is to be delivered to the decree holder, and if necessary, any person who refuses to
vacate the property may be removed. If such decree is for joint possession of
immovable property or if the immovable property is in the occupancy of a tenant,
possession is to be delivered by affixing a copy of the warrant in some conspicuous

15
place on the property and proclaiming, by beat of drum or any other customary mode, at
some convenient place, the substance of the decree. (R. 35 & 36)

Stay of Execution

Rule 26: When Court may stay execution—

(1) The Court to which a decree has been sent for execution shall, upon sufficient cause
being shown, stay the execution of such decree for a reasonable time, to enable the
judgment-debtor to apply to the Court by which the decree was passed, or to any Court
having appellate jurisdiction in respect of the decree or the execution thereof, for an

16
order to stay execution, or for any other order relating to the decree or execution which
might have been made by such Court of first instance or Appellate Court if execution
had been issued thereby, or if application for execution had been made thereto.

(2) Where the property or person of the judgment-debtor has been seized under an
execution, the Court which issued the execution may order the restitution of such
property or the discharge of such person pending the result of the application.

(3) Power to require security from, or impose conditions upon, judgment-debtor—Before

making an order to stay execution or for the restitution of property or the discharge of
the judgment-debtor, the Court shall require] such security from, or impose such
conditions upon, the judgment-debtor as it thinks fit.

Rule 27: Liability of judgment-debtor discharged—

No order of restitution or discharge under Rule 26 shall prevent the property or person
of a judgment-debtor from being retaken in execution of the decree sent for execution.

Rule 28: Order of Court which passed decree or of Appellate Court to be binding
upon Court applied to—

Any order of the Court by which the decree was passed, or of such Court of appeal as
aforesaid, in relation to the execution of such decree, shall be binding upon the Court to
which the decree was sent for execution.

Rule 29: Stay of execution pending suit between decree-holder and judgment-
debtor—

Where a suit is pending in any Court against the holder of a decree of such Court or of a
decree which is being executed by such Court], on the part of the person against whom
the decree was passed, the Court may, on such terms as to security or otherwise, as it
thinks fit, stay execution of the decree until the pending suit has been decided:

17
Provided that if the decree is one for payment of money, the Court shall, if it grants stay
without requiring security, record its reasons for so doing.

Distribution of Assets

Introduction

The Civil Procedure Code, 1908 is a procedural law related to the administration of civil
proceedings in India. It lists the procedure for the distribution of assets by a Court for
cases involving one party or more, on deciding which assets are available for rateable
distribution and which are not; and the method of distribution of assets in such cases.

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The individuals holding a decree can participate in the assets of the judgment-debtor. In
cases where multiple parties hold a decree, the judgment for co-plaintiffs is passed as a
whole but the execution of decree can be done in a matter of attachment and sale.
There is a special provision in the Civil Procedure Code that deals with the execution of
decree when there are multiple parties involved.

Nature, scope & objective

The distribution of assets involves evaluation of the market value of assets, analysation
of the share of individuals entitled to the assets, granting a decree to the individuals
entitled to the assets by passing judgment and executing the decree to divide the assets
among the entitled individuals.

For example, ‘X’ and ‘Y’ are co-plaintiffs and become decree-holders after the
judgment is granted which entitles them to the assets. Let us say for the purpose of the
execution of decree since ‘X’ is entitled to half of the assets in the suit related to
property, whereas ‘Y’ is entitled to only a quarter. The execution of such property shall
be done according to respective shares of individuals in a matter of the sale. And
whatever the amount be received after selling off that property, for the purpose of
execution of such decree, ‘X’ will get exactly half the amount whereas ‘Y’ will get exactly
one fourth the amount.

This process of distribution is called distribution of assets for civil suits and the
provisions regarding the same are provided under Section 73 of the Code of Civil
Procedure, 1908.

The object of Section 73, which provides for the distribution of proceeds of execution
sale rateable amongst the decree-holders, is to provide a cheap and expeditious
remedy for the execution of money decree held against the same judgment-debtor by
adjusting the claims of rival decree-holders without the necessity for separate
proceedings. The special provision was provided to ensure all the decree-holders had
an equal footing in the property or assets they were entitled to, for the purpose of
execution. And that each decree-holder secured their share of the assets lawfully. There
are two prime objectives of the special provision under Section 73, which are:

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 1. It helps prevent an unnecessary multiplicity of proceedings when dealing with
multiple parties holding a decree or claim to be entitled to a share in the assets.

2. To ensure a lawful and equitable distribution of assets among all decree-holders

by providing an equal footing to them.

Conditions

The following conditions must be met to entitle a decree-holder to participate in the

assets of a judgment-debtor and are essential for the application of Section 73:

1. An application must be made to the Court which holds the assets by the decree-
holder claiming to share in the rateable distribution;

2. Such an application should have been made before the receipt of assets held by
the Court;

3. Only the assets held by the Court can be claimed in rateable distribution;

4. Both the attaching creditor and the decree-holder claiming to participate in the
assets should hold the decree for payment of money;

5. Such decree should have been obtained against the same judgment-debtor.

Separate Application

Section 73 does not require a separate application for rateable distribution and there
cannot be any objection to include a prayer for distribution of assets in an application
which is, in fact, the execution of the decree itself

Assets available for rateable distribution

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Section 73 provides for a case where the assets are held by a court, and multiple
individuals have made an application to the court for the execution of decrees and
payment of money before the receipt of assets. And have not obtained the assets after
deduction of the cost of realization. Such assets will be rateaby distributed among all
persons entitled to the property provided if any property is sold subject to mortgage or
charge; the mortgagee shall not be entitled to share in any surplus arising from the sale.
And any property liable to be sold in execution of decree subject to mortgage or charge
may be ordered by the Court to be sold free from mortgage or charge with consent of
the mortgagee, giving him the same interest in the proceeds of the sale as he had in the
property sold.

With regard to the distribution of the proceeds of the sale, Section 73(1)(c) provides,
“Where any immovable property is sold in execution of a decree ordering its sale for the
discharge of an incumbrance thereon, the proceedings of sale shall be applied in the
following way:

Firstly, in defraying the expenses of the sale;

Secondly, in discharging the amount due under the decree;

Thirdly, in discharging the interest and principal money due on subsequent

incumbrances (if any); and

Fourthly, rateably among the holders of decrees for the payment of money against the
judgment-debtor, who have, prior to the sale of the property, applied to the court which
passed the decree ordering such sale for the execution of such decrees, and have not
obtained satisfaction thereof?”

Cost of Realization

The cost of realization of assets by the Court is deducted from the total value of the
asset before the decree is executed and the asset is then distributed to the entitled
individuals. The cost is borne by the decree-holder as the process of realization of the
asset is done for the decree-holder or the individual entitled to the asset.

Mode of Distribution

21
The distribution of rateable assets is done by sale if two or more parties are involved. A
property entitled to two individuals is sold by the Court and the cost of realization is
deducted from the total sale value of the property. The remaining amount is then divided
between the two parties based on the share they are entitled to and distributed.

Suit for Refund

Section 73(2) states that when all or any assets liable to be rateably distributed are paid
to a person not entitled to receive the same, the person entitled may sue such a person
and compel him to refund the assets.

Determination of claim

The application of claim by decree-holders is analysed to determine the share of the

entitled parties. And the rightful execution of a decree is done to ensure equitable
distribution of assets under law. The determination of claim is essential to establish the
debt to the government which takes precedence over other debts.

Special Provisions Regarding Arrest & Detention

Section 55 to 59 and Rules 37 to 40 of Order XXI of the Civil Procedure Code lay
down special provisions governing arrest and detention of persons in execution of a
decree and the circumstances in which such persons may be released. The twelve rules
governing such arrest, detention and release may be summarized as follows:

(i) A judgment-debtor can be arrested in execution of a decree at any hour and on any
day

22
(ii) However, a woman cannot be arrested in execution or detained in civil prison in
execution of a decree for the payment of money

(iii) After such arrest, he must be brought before the court as soon as practicable, and
thereafter detained in the civil prison

(iv) However for making such an arrest, no dwelling-house can be entered after sunset
or before sunrise

(v) (a) The outer doors of a dwelling-house cannot be broken, unless the house is in the
occupancy of the judgment-debtor and he refuses, or in any way, prevents access
thereto

(b) But, if the officer is already in such a house, he can break open the door of any room
in which he believes the judgment-debtor is to be found

(c) If a room is in the actual occupancy of a woman who is not the judgment-debtor and
who according to her custom does not appear in public (as for instance, an orthodox
purdanashin lady), the officer must first give her notice that she may withdraw from the
room if she so desires. Thereafter, only after a reasonable time and after giving her
reasonable facility for withdrawing, the officer can enter the room for making the arrest.

(vi) Under S.58, detention in a civil prison in execution of a decree cannot exceed the
following limits, namely,-

 when the decree is for payment of a sum exceeding Rs 5000, three months
(maximum) and

 when the decree is for payment of a sum between Rs 2000 and Rs 5000, six
weeks (maximum)

(vii) If the decree is only for payment of money, and the judgment-debtor pays the
amount of the decree and the costs of his arrest to the officer arresting him, such officer
is bound to release him at once.

(vill) A judgment-debtor is to be released from prison before the expiry of his period of
detention-

23
(a) if the amount mentioned in his arrest warrant has been paid to the officer-in-charge
of the prison; or

(b) if the decree against him is otherwise fully satisfied; or

(c) if the person on whose application he has been detained requests for his release; or

(d) if the person on whose application he has been detained fails to pay subsistence
allowance.

If the release of a judgment-debtor is under clause (b) or clause (c) above, an order of
the Court is to be obtained before his release.

(ix) A person committed to a civil prison can be released from the prison, -

(a) by the State Government on the ground of the existence of any infectious or
contagious disease; or

(b) by the committing Court, or any Court to which that Court is subordinate, on the
ground of his suffering from any serious illness.

(x) When a judgment-debtor is arrested and brought before the Court, the Court must
inform him that he may apply to be declared an insolvent, and that he may be
discharged, if he had not committed any act of bad faith regarding the subject of the
application and if he complies with the insolvency law. If the judgment-debtor expresses
his intention to apply to be declared an insolvent, and furnishes satisfactory security to
the Court that he will so apply within a month and that he will also appear in any
proceedings when called upon to do so, the Court may release him. If he then fails to
apply or appear as aforesaid, the Court may either direct the security to be realised or
commit him to civil prison in execution of the decree.

(xi) When the decree is only for payment of money, the Court may, instead of issuing an
arrest-warrant, issue a notice calling upon the judgment-debtor to appear before the
Court on a specified day, and show cause why he should not be committed to the civil
prison.

24
Such a notice is, however, not to be issued if the Court is satisfied that such a person is
likely to abscond or leave the local limits of the Court's jurisdiction with the object or
effect of delaying the execution of the decree.

(xii) No judgment-debtor can be arrested in execution of a decree unless and until the
decree-holder pays into the Court the subsistence allowance of the judgment-debtor as
fixed by the Court. (Under S 57 of the Code the State Government is empowered to fix
scales of monthly subsistence allowance, graduated according to the rank, race and
nationality of the arrested person.)

Special Provisions Regarding Attachment of Property

Section 60 to 64 and Rules 41 to 59 of Order XXI of the Civil Procedure Code lay
down detailed provisions regarding attachment in execution of a decree. The salient
features of the scheme of attachment provided for in the Code may be set out as
follows.

25
Property liable to attachment and sale

Under S. 60 of the Code, the following nine kinds of property are liable to attachment
and sale in execution of a decree, viz.,

(i) land;

(ii) houses or other buildings;

(iii) goods;

(iv) money and bank-notes;

(v) cheques, bills of exchange, hundis and promissory notes;

(vi) Government securities, bonds and other securities for money:

(vii) debts;

(viii) shares in a corporation (i.e. a company); and

(ix) all other saleable property, movable or immovable, belonging to the judgment-
debtor or over which he has a disposing power which he can exercise for his own
benefit.

It is immaterial whether such property is held by the judgment-debtor in his own name
or by any other person in trust for him or on his behalf.

It is also provided (by S.60) that the following twenty kinds of property are not liable to
attachment or sale, viz.-

(a) the necessary wearing-apparel, cooking vessels, bedding of the judgment-debtor,

his wife and children and such personal ornaments as, in accordance with religious
usage, cannot be parted with by any woman;

26
(b) tools of artisans, and where the judgment-debtor is an agriculturist, his implements
of husbandry and such cattle and seed-grain as may. in the opinion of the Court, be
necessary to enable him to earn, his livelihood as such, and such portion of agricultural
produce or of any class of agricultural produce as may have been declared to be free
from liability under the provisions of section 61 (below);

(c) houses and other buildings belonging to an agriculturist or a laborer or a domestic

servant and occupied by him;

(d) books of account;

(e) a mere right to sue for damages;

(f) any right of personal service;

(g) stipends and gratuities allowed to pensioners of the Government or of a local

authority or of any other employer or payable out of any service family pension fund
notified in the Official Gazette by the Central Government or the State Government in
this behalf, and political pensions;

(h) the wages of labourers and domestic servants, whether payable in money or in kind;

(i) salary to the extent to the first one thousand rupees and two-thirds of the remainder,
in execution of any decree other than a decree for maintenance;

(j) one-third of the salary in execution of any decree for maintenance;

(k) the pay and the allowances of persons to whom the Air Force Act, 1950, or the Army
Act, 1950, or the Navy Act, 1957, applies,

(I) all compulsory deposits and other sums in or derived from any fund to which the
Provident Funds Act, 1925, for the time being applies, in so far as they are declared by
the said Act not to be liable to attachment.

(m) all deposits and other sums in or derived from any fund to which the Public
Provident Fund Act, 1968, for the time being applies, in so far as they are declared by
the said Act as not to be liable to attachment;

(n) all moneys payable under a policy of insurance on the life of the judgment-debtor.

(0) the interest of a lessee of a residential building to which the provisions of law for the
time being in force relating to control of rents and accommodation apply;

27
(p) any allowance forming part of the emolument of any servant of the Government or of
any servant of a railway company or local authority which the appropriate Government
may, by Notification in the Office Gazette, declare to be exempt from attachment, and
any subsistence grant or allowance made to any such servant while under suspension:

(q) an expectancy of succession by survivorship or other merely contingent or possible

right or interest;

(r) a right to future maintenance;

(s) any allowance declared by any Indian law to be exempt from liability to attachment
or sale in execution of a decree

(t) where the judgment-debtor is a person liable for the payment of land revenue, any
moveable property which, under any law for the time being applicable to him, is exempt
from sale for the recovery of an arrear of such revenue.

S. 60 further clarifies that as regards the money payable under clauses (9). (h), (i), (j),
(k), (p) and (s) above, such amounts are exempt from attachment and sale, whether
before or after they are actually payable.

As regards salary (clause (i) above), it is also clarified that the attachable portion thereof
is liable to attachment, whether before or after it is actually payable. Moreover, if any
portion of attachable salary is already under attachment, whether continuously or
intermittently, for a total period of twenty- four months, such portion also becomes
exempt from attachment for a further period of twelve months. Furthermore, if such
attachment is made in execution of one and the same decree, if the attachment is
continued for a total period of twenty-four months, even the attachable portion of the
judgment-debtor's salary becomes exempt from attachment in execution of that decree.

It is important to note that all the twenty kinds of property listed above are exempt from
attachment by virtue of S. 60 of the Code, and it is not open to a person to waive the
benefit of this exemption. Thus, even if the judgment-debtor agrees in writing that such
property may be attached, the agreement itself will be void.

In addition to the above twenty items, it is open to the State Government to declare that
such portion of agriculture produce as it deems fit shall also be exempt from attachment
and sale in execution of a decree. (S. 61)

Private transfers prohibited

Where an attachment has been made, any private transfer or delivery of such property
cannot be made. Such a transfer or delivery, as also any payment to the judgment-
debtor of any debt, dividend or other money is void as against all claims enforceable
under the attachment. (S. 64)

28
S. 64 thus enacts that a private alienation of property after attachment is void as against
any claim enforceable under the attachment. The object of the section is to prevent
fraud on the decree-holder and to secure intact the nights of attaching creditors.

It is immaterial for the application of the section whether the decree had or had not been
passed before the time when the transfer was effected, or whether the transferee acted
in good faith or not. The section makes no distinction between attachment before
judgment and attachment in execution of a decree. So, a private alienation of property
pending a valid attachment before judgment is void against claims enforceable under
the attachment.

It is important to note that the attachment must have been legally effected in the manner
prescribed by the Code, and where the formalities laid down by O. 38, R. 5 are not
complied with, the attachment will be held to be invalid, and an alienation pending such
attachment would be valid.

Private Transfer

The word 'transfer' means a transfer between living persons and does not include a
devise by will. Moreover, 'private transfer'' means a voluntary transfer, and not a transfer
by operation of law, e.g., an enforced execution of a Conveyance in obedience to the
order of the Court.

Further, the effect of S. 64 is not to invalidate such private alienation for all purposes,
but only as against claims enforceable under the attachment. In other words, under this
section, a private transfer is not void ab initio, it is not void as against all third parties,
but is void only against claims which are enforceable under the attachment. The benefit
of the section can be waived by the decree-holder so as to bind himself and his
assignee with notice.

The wording of S. 64 indicates that the section has no application to a transfer made
before the attachment is levied. It is provided that S. 64 is not to apply to any private
transfer or delivery of the property attached, or of any interest therein, made in
pursuance of any contract for such transfer and delivery, provided that such a contract
is entered into and registered before the attachment. Subject to the restriction imposed
by the section, there must be a valid attachment. The modes of attachment of various
kinds of property are prescribed in O. 21. If, however, for one reason or the other, there
is no valid attachment, as where the order of attachment is ultra vires, or is obtained
collusively, the section does not apply.

To illustrate the effect of the section, suppose that B owns a house worth *50,000
and that he has no other property. A sues B for 50,000. Now, B may sell or mortgage
his house, in spite of the fact that a suit is pending against him. He can even do so after
a decree has been passed against him, and in either case, the purchaser or the

29
mortgagee will get a good title. But, if the house is attached in execution of A's decree,
any such attempted sale or mortgage would be void as against A's claims.

Various Modes of Attachment

Rules 41 to 59 of Order XXI lay down the detailed rules governing attachment of various
kinds of property, which can be summarized as follow:

Attachment of movable property other than agricultural produce

If the property to be attached is moveable property other than agricultural produce, the
attachment is to be made by actual seizure. And the attaching officer must keep such
property in his own custody or in the custody of his subordinates. If such property is
subject to speedy and natural decay or if the expense of keeping it is likely to exceed its
value, such property may at once be sold by the attaching officer. (R. 43)

If such movable property consists of livestock, agricultural implements or other articles

which cannot be removed conveniently, the attaching officer may leave it at the place
when it has been attached in the custody of any respectable person (“custodian”). Such
a custodian must then produce the property at the place ordered by the court or restore
it to a person named by the Court. (R. 43)

Attachment of agricultural produce

Special provisions are made for attachment of agricultural produce. In such cases, the
attachment is to be made by affixing a copy of the warrant of attachment-

(a) where the produce is growing crop-on the land on which the crop has grown;

(b) where the produce is cut or gathered-on the threshing floor or the place for treading
out grain;

(c) on the outer door or some other conspicuous part of the house in which the
judgment-debtor ordinarily resides. [R. 44]

When agricultural produce is attached, the Court must make such arrangement as it
thinks fit for the custody of such produce; and for the purpose of enabling the Court to
make such arrangement, it is further provided that ever/ application for attachment of
growing crop must specify the time at which it is likely to be cut or gathered. [R. 45(2)]

It is also clarified that agricultural produce attached as a growing crop is not to be

deemed to have ceased to be under attachment or to require reattachment, merely
because it has been severed from the soil. [R. 45(3))

30
It is further provided that if an order for attachment of a growing crop has been made at
a time considerably before the crop is likely to be fit to be cut or gathered, the Court
may suspend the execution of the order for such time as it think fit, and in the
meanwhile, prohibit the removal of such crop. [R. 45(4)]

Attachment of debts and shares

Attachment of a debt, not secured by a negotiable instrument, is to be made by a written

order prohibiting the creditor from recovering the debt, and the debtor from making
payment thereof, until further orders of the Court. (R. 46)

Attachment of shares in a company is to be made by a written order prohibiting the

person in whose name the shares may be standing from transferring the same or
receiving any dividend on such shares. (R. 46)

Attachment of any other movable property not in the possession of the judgment-debtor
(except property deposited in the Court) is to be made by a written order prohibiting the
person in possession of the same from giving it to the judgment-debtor. (R. 46)

Garnishee orders

Rules 46-A to 46-1 lay down important provisions governing a garnishes notice. A
garnishee is a debtor in whose hands a debt is attached. He is ordered by the Court not
to pay the debt to his creditor, but to deposit the amount in the Court. A garnishee order
is thus an order served on a garnishee, attaching a debt in his hands.

Thus, the court has passed an order against A for non-payment of a loan taken by him.
A is an employee of B. In such a case, if the court deems fit, it can pass an order
against B. directing him to deposit a fixed amount from A's salary in the court every
month in the future, or to pay such amount directly to A's creditor in whose favor the
order had been passed, for a given period of time. In such a case, the employer, B, is
called the garnishee.

In other words, garnishment proceedings are legal proceedings where the plaintiff seeks
satisfaction of the decree passed in his favor by obtaining a direction from the court that
a third party (as for instance, his employer) should make some amount due to the
defendant (a part of the salary in the above case) available to satisfy the decree.

It is provided that in the case of debt (other than a debt secured by a mortgage or a
cheque) which has been attached under R. 46 (above), or a negotiable instrument
attached under R. 51 (below), the Court may, on the application of the attaching
creditor, issue a notice to the garnishee liable to pay such debt, calling upon him either
to pay that due into the Court or to appear and show cause why he should not do so. If
the garnishee pays such an amount to the Court, the Court may direct that the money

31
may be paid to the decree-holder in satisfaction of the decree and the cost of execution.
(R. 46A)

Payment by the garnishee as above constitutes a valid discharge to him as against the
judgment-debtor. This is so even if the decree in execution of which the application was
made is later set aside or reversed. (R. 46F)

If, however, the garnishee does not forthwith pay the amount into the Court, or does not
appear in the Court to show cause why he has not so paid- the amount, the Court may
pass an order against the garnishee calling upon him to comply with the terms of
garnishee notice, and on non-compliance with such an order, execution may issue
against the garnishee, just as if such an order were a decree against him. (R. 46B)

If the garnishee disputes the liability to pay, the Court may order that question to be
tried as if it was an issue in the suit and thereafter pass the necessary order. (R. 46C)

If it is suggested, or where it appears to be probable, that the debt (in respect of which
the garnishee notice is issued) belongs to a third party, or that a third party has any lien
or charge on or other interest in such debt, the Court may order such a person to
appear before the Court, and after hearing him (he does appear), pass an appropriate
order. (R. 46D & 46E)

The costs of applications relating to garnishee notices and all incidental proceedings are
at the discretion of the Court. (R. 46G)

An appeal can be filed against orders passed in garnishee proceedings as if such

orders were decrees of the Court. (R. 46H)

The above provisions relating to garnishee orders apply, mutatis mutandis to negotiable
instruments attached under R. 51 (below) as they apply to debts. (R. 46-1)

Attachment of a share in moveables

Under R. 47, if the property to be attached consists of the share or interest of the
judgment-debtor in moveable property belonging to him and another (or others) as co-
owners, attachment is to be made by a notice to the judgment- debtor prohibiting him
from transferring such share or interest or charging it in any way.

Attachment of salary or allowances of Government servants

32
If the property to be attached is the salary or allowances of a Government servant, or of
a servant of a railway company or local authority, or of a servant of a corporation
engaged in any trade or industry and established by a central, provincial or state Act or
a Government company, the attachment is to be made by ordering the amount to be
withheld from the salary or allowances (within the limits laid down by S. 60, seen above)
either in one payment or by monthly installments as may as directed by the Court. It
then becomes the duty of the disbursing officer to withhold such amount and remit it to
the Court. (R. 48)

Attachment of salary or allowances of private employees

If the property to be attached is the salary or allowance of an employee other than an

employee covered by R. 48 (above), the attachment is to be made by ordering the
amount to be withheld, subject to the limits of S. 60 (seen above), either in one payment
or by monthly installments as may be directed by the Court. It then becomes the duty of
the disbursing officer to withhold such amount and remit it to the Court. (R. 48A)

Attachment of partnership property

Under R. 49, property belonging to a partnership is not to be attached or sold except in

execution of a decree passed against the firm or against the partners in the firm as
such.

On the application of the holder of a decree against a partner, the Court may pass an
order charging the interest of such a partner in the property and profits of the
partnership, and may, by the same or a subsequent order, appoint a receiver of the
share of such partner in the profits of the firm, and may then order a sale of such
interest. The other partner or partners are, however, at liberty, at any time, to redeem
the interest charged, and in the case of a sale, to purchase such partner's interest in the
firm.

Execution of a decree against a firm

R. 50 provides that if a decree has been passed against the firm, execution may be
granted-

(a) against any property of the partnership;

33
(b) against any person who has appeared in his own name (under rule 6 or rule 7 of
Order XXX) or who has admitted on the pleadings, that he is, or who has been
adjudged to be, a partner;

(c) against any person who has been individually served as a partner with a summons
and has failed to appear.

If the decree-holder claims to have the decree executed against a person other than
those referred to in clause (b) or (c) above, as being a partner in the firm, he can apply
to the Court for leave to do so, and where such liability is not disputed, the Court may
grant such leave. If, however, such liability is disputed, the Court may order that the
liability of such a person be tried and determined, and then pass an appropriate order.
Such an order has the force of a decree for purposes of an appeal.

Rule 50 has to be read along with O. 30. The latter deals with the procedure in suits
instituted
by or against firms, while this rule deals with the mode of execution of decrees against
firms, in the firm's name. When a decree is passed against a firm, execution may be
granted as of course only against the partnership property and against persons referred
to in clauses (b) and (c) of this rule. But where the decree is sought to be executed
against any other person alleged to be a partner, the decree-holder must apply to the
Court which passed the decree for leave to execute the decree against him.

Moreover, execution under this rule can only be granted where a decree has been
passed against a firm. A decree passed against a firm must perforce be in the firm's
name. Under this rule, execution may be granted against the partnership property. It
may also me granted against the partners, in which case the decree-holder may
proceed against the separate property of the partners.

Attachment of negotiable instruments

If the property to be attached is a negotiable instrument which is neither deposited in a

Court nor in the custody of a public officer, the attachment is to be made by actual
seizure of the negotiable instrument. Thereafter, the instrument is to be brought into the
Court, and held there subject to further orders of the Court. (R. 51)

34
As stated above, the provisions relating to garnishee orders (-discussed above-) also
apply to negotiable instruments attached under S. 51.

Attachment of property in custody of a court or a public officer

Under R. 52, if the property to be attached is in the custody of any Court or of a public
officer, the attachment is to be made by issuing a notice to such Court or officer,
requesting that such property (and any interest or dividend becoming payable thereof)
may be held subject to the further orders of the Court issuing such a notice.

Attachment of a decree

Under R. 53, when the property to be attached is a decree, either for the payment of
money or for sale in enforcement of a mortgage or charge, the attachment is to be
made, -

(a) if the decrees were passed by the same Court, then by order of such Court; and

(b) if the decree sought to be attached was passed by another Court, then by the issue
to such other Court, of a notice by the Court which passed the decree sought to be
executed, requesting such other Court to stay the execution of its decree, unless and
until-

(i) the Court which passed the decree sought to be executed cancels the notice;

(ii) (a) the holder of the decree sought to be executed; or

(b) his judgment-debtor, with the previous written consent of such decree-holder or
with the permission of the attaching court.

applies to the Court receiving such notice to execute the attached decree. If the
property to be attached is a decree other than a decree referred to above, as for
instance, a decree for specific performance or for partition, the attachment is to be
made by a notice by the Court which passed the decree sought to be executed, to the
holder of the decree sought to be attached, prohibiting him from transferring or charging
the same in any way. If such a decree has been passed by any other Court, such other
Court must also be sent a notice to abstain from executing the decree sought to be
attached, until such notice is cancelled by the Court issuing it.

35
Attachment of immovable property

R. 54 (of O. XXI) provides that if the property to be attached is immovable property, the
attachment is to be made by an order prohibiting the judgment- debtor from transferring
or charging the property in any way, and by prohibiting all persons from taking any
benefit from such a transfer or charge. Such an order is to be proclaimed at some place
on or adjacent to such property, by beating of a drum or some other customary mode. A
copy of the order is also to be affixed on a conspicuous part of the property as also
upon a conspicuous part of the Court-house, and when the property is land paying
revenue to the Government, also in the office of the Collector, and when the property is
land situated in a village, also in the office of the Gram Panchayat having jurisdiction
over that village.

R. 55 provides that if -

(a) the amount declared with costs and all charges and expenses resulting from the
attachment of any property are paid into Court; or

(b) satisfaction of the decree is otherwise made through the Court or certified to the
Court; or

(c) the decree is set aside or reversed,-

The attachment is deemed to be withdrawn. In the case of immovable property. the

judgment-debtor desires, the withdrawal of the attachment may be proclaimed at his
expense, and a copy of the proclamation is to be affixed in the same manner as under
R. 54 (above).

Adjudication of claims and objections

Under R. 58 (of O. XXI), if any claims or objection is made to the attachment of any
property on the ground that such property is not liable to such attachment, the court
must proceed to adjudicate upon such claim or objection. However, in the following two
cases, no such claim or objection can be entertained, namely, _

36
(a) where, before the claim is referred or objection is made, the property attached has
already been sold; or

(b) where the Court considers that the claim or objection was designedly or
unnecessarily delayed.

After determining the disputed questions, the Court must, in accordance with such
determination-

(a) allow the claim or objection, and release the property from attachment either wholly
or to such extent as it thinks fit; or

(b) disallow the claim or objection; or

(c) continue the attachment subject to any mortgage, charge or other

interest in favour of any person; or

(d) pass such order as in the circumstances of the case it deems fit.

R. 59 then provides that if, before such a claim is preferred or objection made, the
property which has been attached is already advertised for sale, the Court may-

(a) if the property is moveable, make on order postponing the sale pending the
adjudication of the claim or objection; or

(b) if the property is immovable, make on order that, pending the adjudication of the
claim or objection, the property shall not be sold, or, that pending such adjudication, the
property may be sold, but the sale shall not be confirmed, and any such order may be
made subject to such terms and conditions as to security or otherwise as the Court
thinks fit.

Special Provisions Regarding Sale of Property

 General provisions of Ss. 65-67 of the code

Sections 65 to 67 of the Code lay down the basic principles governing sale of property
in execution of a decree.

37
Under S. 65, if immoveable property is sold in execution of a decree and the sale has
became absolute, the property is deemed to have vested in the purchaser, not from the
date on which the sale become absolute, but from the date on which the property was
sold.

A judicial sale, unlike a private one, is not complete as soon as it takes place. It is liable
to be set aside on appropriate proceedings taken under 0.21. rr. 89-91. if no such
proceedings are taken, or if taken, are not successful, the sale will then be made
absolute under O. 21, r. 62. Questions, therefore, arise as to whether the auction-
purchaser is entitled to rents and profits during the period between the two dates, i.e.,
the date of the sale and the date of the certificate of sale. In order to settle such
disputes, section 65 lays down that though the property does not vest in the auction-
purchaser till the date of confirmation, once the sale is confirmed and becomes
absolute, the title of the auction-purchaser relates back to the date of the sale itself.

The effect of this rule (which operates retrospectively) is that the auction- purchaser will
be entitled to rights in the property and be liable to the obligations in respect of the
same as from the date of sale. So, if there are accretions to the property between the
date of sale and the date of confirmation, they would belong to him. Similarly, if the
property is, between these two dates, sold for arrears of land revenue, he would lose it
completely.

When court sale becomes absolute: A compulsory sale (ie. a Court sale) does not
become absolute until sometime after the sale. A period of at least thirty days must
elapse. During that period, the sale is liable to be set aside at the instance of the
judgment-debtor on several grounds. If such an application is not made, the Court must
make an order confirming the sale, and it is upon such confirmation that the sale
becomes absolute: 0.21, r. 92. After the sale has become absolute, a certificate of sale
is granted to the purchaser. Such a certificate bears the date on which the sale
becomes absolute, and it is then that the property sold vests to the purchaser.

Sale when void: A sale in execution of a decree is void if the Court had no jurisdiction
to sell the property. Thus, a Court has no jurisdiction to sell the property in execution of
a decree if the notice required by O. 21, R. 22 is not served.

S. 66 then provides that no suit can be maintained against any person claiming title
under a purchase which is certified by the Court on the ground that the purchase was
made on behalf of the plaintiff or on behalf of someone else through whom the plaintiff
claims (ie. benami purchasers).

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Likewise, in a suit where a person claims a title under a purchaser who is so certified,
the Defendant cannot plead that the purchase was actually made on his behalf or on
behalf of someone through whom he claims. However, S. 66 does not bar suit to obtain
a declaration that the name of any purchaser certified as aforesaid was inserted in the
certificate fraudulently or without the consent of the real purchaser, or interfere with the
right of a third person to proceed against that property, though ostensibly sold to the
certified purchaser, on the ground that it is liable to satisfy a claim of such third person
against the real owner. Likewise, S. 66 does not interfere with the right of a third party to
proceed against that property, though ostensibly sold to the certified purchaser, on the
ground that it is liable to satisfy a claim of such third person against the real owner.

S. 66 thus enact an exception to the general rule applicable to benami transactions, i.e.,
transactions by one person in the name of another. The object of this provision is to put
an end to purchases in Court auctions by one person in the name of another and to
protect third parties (who might deal with the purchaser) against the claims of an
undeclared or secret owner who puts forward the certified purchaser as the legal owner.
The effect of the section would, at first sight, appear to help the certified purchaser in his
fraud or breach of trust against the real purchaser, but actually the section is designed
to prevent fraud against third parties, resulting from the collusive action of the real and
certified purchasers.

The law, however, is different as to benami purchasers at a Court-sale. If A purchases

property in B's name at a Court-sale, and a certificate of sale is issued to B, B will be
conclusively deemed to be the real purchaser as against A, and no suit will lie under this
section by A against 6 for possession of the property, unless A can prove that B's name
was inserted in the certificate fraudulently or without his consent.

In order that section 66 may apply, the following three essentials are necessary:

(1) There should be a Court-sale. The section applies only to execution sales under the
Code. It has no application to revenue sales.

(2) The sale must be a real, and not a fictitious sale. Thus, where a collusive suit is
brought in which a collusive decree is allowed to be passed and a fictitious sale held in
execution of such decree, this section has no application.

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(3) The suit must be against the certified purchaser or his representative, on the ground
that the purchase was made on behalf of the plaintiff.

The wording of S. 66 indicates that not even a suit for the return of the purchase money
from the benamindar will lie. Moreover, the section bars only a suit against the certified
purchaser or his representative interest. So, where a suit is brought by the certified
purchaser or his representative against the real owner, the latter can plead that the
purchase was only benami for him. The section does not bar a plea of benami in
defence.

S. 67 then empowers the State Government to make rules governing sales of land in
execution of money decrees.

 General provisions of rules 64-73 of O. XXI

Under Rule 64 (of O. XXI), any Court executing a decree may order that any property
attached by it and liable to sale (or such portion of such property as may be sufficient to
satisfy the decree) may be sold, and that the proceeds of such sale (or a sufficient
portion of such proceeds) be paid to the decree- holder.

Every such sale is to be conducted by an officer of the Court (or such other person as
may be appointed by the Court) and is to be made by public auction. Before such an
auction, a proclamation of the intended sale is to be made. The proclamation must state
the time and place of the sale, and specify the following five matters as fairly and
accurately as possible, viz.-

(a) the property to be sold or, where a part of the property would be sufficient to satisfy
the decree, such part;

(b) the revenue assessed upon the estate or part of the estate, where the property to be
sold is an interest in an estate or a part of an estate paying revenue to the Government;

(c) any encumbrance to which the property is liable;

(d) the amount for the recovery of which the sale is ordered; and

(e) every other thing which the Court considers material for a purchaser to know in order
to judge the nature and value of the property.

Such a proclamation is to be made at some place on or adjacent to the property to be

sold, by beat of drum or some other customary mode, and a copy of the proclamation is

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to be affixed on a conspicuous part of the property and also a conspicuous part of the
Court-house. If the property is land paying revenue to the Government, the
proclamation is also to be affixed in the office of the Collector; and if such land is in a
village, also in the office of the Gram Panchayat having jurisdiction over that village. If
the Court so directs the proclamation is also to be published in the local Official Gazette
or in a local newspaper, or both

When the property is divided into lots which are to be sold separately, it is not
necessary to make a separate proclamation for each lot, unless proper notice of the
sale cannot otherwise be given.

Thereafter, except in the case of property subject to speedy and natural decay, the sale
can take place after the expirty of at least fifteen days in the case of immovable property
and at least seven days in the case of movable property, such days to be calculated
from the date on which a copy of the proclamation has been affixed on the Court-house.
This requirement can be dispensed with if the judgment-debtor consents to a shorter
period in writing.

The Court may also, from time to time, adjourn such a sale, but if the sale is adjourned
for thirty days or more, a fresh proclamation is to be issued, unless the judgment-debtor
consents to waive it.

Moreover, if before the lot put up for sale is knocked down, the debt in question and
costs (including costs of the sale) are tendered to the officer conducting the sale or
proof is given to his satisfaction that such amounts have been paid into Court, the sale
is to be stopped immediately. (R. 69)

If a purchaser (who has bid at such a sale) commits a default, the property is to be put
up for sale once again, and any deficiency in price at the re-sale as well as the costs of
such a re-sale, are to be recovered from the defaulting purchaser. (R. 71)

Under R. 72, the decree-holder himself cannot bid for or purchase the property sold in
execution of his decree without the express permission of the Court. If he does so
directly or through some other person, the sale is liable to be set aside on the
application of the judgment-debtor or any other person whose interests are effected by
the sale. Thus, a sale is not void ab initio; it is merely voidable, and this would be so,
even if the decree-holder had applied for the Court's permission but such permission
was refused. (Bai Radha Krishna v. Bishesar, 1922 4 LA. 312)

If, however, the decree-holder purchases such property after obtaining the Court's
permission to do so, the purchase-money and the amount due on the decree are to set

41
off one against the other, and the Court enters satisfaction on the decree, in whole or in
part, as the case may be.

Likewise under R. 72A, a mortgagee of immovable property cannot bid for or purchase
property sold in execution of a decree on the mortgage, unless the Court grants him
leave to do so. And even when such leave is granted, the Court has to fix a reserve
price (applicable to him), and the reserve price is normally not less than the amount
then due under the mortgage for the principal amount, interest and costs.

So also, no officer or other person having any duty to perform in connection with a sale
can, either directly or indirectly, bid for, acquire or attempt to acquire any interest in the
property which is sold.

 Special provisions for sale of movable property (Rules 74-81 of O. XXI)

Special provisions are enacted by Rules 74 to 81 of order XXI for the sale of movable
property in execution of decrees.

Under R. 74, if the property to be sold is agricultural produce, the sale is to be held, -

(a) if such produce is a growing crop - on or near the land on which such crop has
grown; or

(b) if such produce has been cut or gathered - at or near the threshing floor or place for
treading out grain or the like or fodder-stack on or in which it is deposited.

If, when such agricultural produce is put up for sale,-

(a) a fair price, in the estimation of the person holding the sale, is not offered for it, and

(b) the owner of the produce, or a person authorised to act in his behalf applies to have
the sale postponed till the next day or if a market is held at the place of sale, the next
market-day, -

the sale is to be postponed and is then to be completed later, whatever be the price
offered for such produce.

If the property to be sold is growing crop and such crop can be stored, but has not yet
been stored, the date of the sale is to be fixed in such a way that the crop would be
stored before that date and the sale is to be held only after the crop has been cut or
gathered and is ready for storing. If, by its very nature, the crop cannot be stored, it can

42
be sold before it is cut or gathered, and the purchaser would be entitled to enter on the
land, and do all that may be necessary for cutting and gathering it. (R. 75)

If the property to be sold is a negotiable instrument or a share in a company, the Court

may authorize the sale of such property through a broker, rather than by public auction
(R. 76). In such a case, the judge (or an Officer appointed by the judge) may execute
such document or make such endorsement thereon, as may be necessary, which has
the same effect, as if it was done by the party himself (R. 80). Such execution or
endorsement as under:

"A.B. by CD. Judge of the Bombay High Court, in a suit by E.F. against AS"

When movable property is sold by public auction, the price of each lot is to be paid at
the time of sale, or soon thereafter, as may be directed. In default of such payment, the
property is to be resold forthwith. On payment of such purchase-money, a receipt is to
be given to the purchaser, and the sale then becomes absolute.

A salutary provision is also enacted that if such movable property is jointly owned by the
judgment-debtor and another co-owner (or co-owners), and a co-owner bids the same
amount as another bidder, the co-owner's bid is to have preference. (R. 77)

Under R. 78, if there is an irregularity in publishing or conducting a sale of movable

property, such an irregularity does not vitiate the sale. However, any person sustaining
an injury on account of such irregularity may sue the person responsible for
compensation. (This provision is to be contrasted with that contained in R. 90, under
which a material irregularity in a sale of immovable property enables a Court to set
aside such a sale.)

As regards the mode of delivery of movable property which has been sold in execution
of a decree, it is provided that if actual seizure has been made of such property, it is to
be delivered to the purchaser. If, however, such property is in the possession of some
other person, delivery is to be made to the purchaser by giving notice to the person in
possession, prohibiting him from delivering such property to any person except the
purchaser.

If such property is a debt not secured by a negotiable instrument, delivery is to 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
purchaser.

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In the case of a share in a company, such an order prohibits the shareholder from
transferring such a share to any person except the purchaser, or receiving any dividend
or interest on such a share, and the company from transferring such a share or making
such a payment (R. 79). In case of other types of property, the Court may make an
appropriate vesting order. (R. 81)

 Special Provisions for sale of immovable property (Rules 82-106 of O. XXI)

Rules 82 to 106 of Order XXI enact special provisions for sale of immovable property in
execution of decrees.

It is provided that all Courts, except Small Causes Courts, can order sale of immovable
property in execution of a decree. (R. 82)

If after the Court has ordered sale of immovable property, the judgment- debtor satisfies
the Court that the amount of the decree can be raised by a mortgage or lease or a
private sale of property or of any other property of the judgment-debtor, the Court may
postpone the sale on such terms and for such period as it deems proper. However, in
such cases, no mortgage, lease or sale becomes absolute until it is confirmed by Court.
Moreover, this provision does not apply when property is directed to be sold in
execution of a decree for sale in enforcement of a mortgage of or charge on, such
property. (R. 83)

The purchaser at any such sale of immovable property must immediately deposit
twenty-five per cent of the purchase price, and if such deposit is not made, the property
is to be re-sold forthwith. (R. 84)

The balance amount is to be paid by the purchaser within fifteen days, failing which the
deposit may be forfeited and the defaulting purchaser loses all claims to such property.
The property is then to be re-sold. (Rr. 85 and 86)

As in the case of movable property, if the immovable property is jointly owned by the
judgment-debtor and another co-owner (or co-owners), and a co-owner bids the same
amount as another bidder, the co-owner's bid is to be given preference. (R. 88)

A sale of immovable property can be set aside in the following three ways:

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(a) Any person having an interest in such property apply to the Court to set aside the
sale after depositing into the Court,

(i) five per cent of the purchase-money - for payment to the purchaser; and

(ii) the amount specified in the proclamation of sale for payment to the decree-holder.
(R. 89)

(b) The decree-holder or the purchaser or any person whose interests are affected by
the sale can apply to the Court to set aside the sale on the ground of a material
irregularity or fraud in publishing or conducting the sale, if it is shown that such an
irregularity or fraud has substantially injured such a person. However, a mere defect in
attachment of such property (or even the absence of such attachment) is not, by itself, a
ground for setting aside such a sale. (R. 90)

The following are some instances of "material irregularity" in publishing or conducting a

sale in execution:

(1) Mis-statement of the value of the property or the Government revenue in the
proclamation of sale: Saadatmand v. Phul Kuar, (1898) 25 I.A. 146.

(2) Service of notice to show cause under 0.21, r. 22, upon a wrong person as legal
representative: Malkarjun v. Narhari, (1901) 27 I.A. 216.

(3) Omission to issue a fresh proclamation where a sale is adjourned, unless the
proclamation has been waived: Bipin Behari Mitri v. Jatindranath, (1901) 37 Cal. 897.

(4) Omission to specify in the proclamation of sale, the extent of the property to be sold
or the revenue assessed on it: Athappa Ramkrishna, (1898) 21 Md. 51.

(5) Default in payment of the deposit of 25 per cent, as required by O. 21, r. 84: Bhim
Singh v. Sarwan, (1889) 16 Cal. 33.

If an act or an omission amounts to a material irregularity, the sale is not void, but
merely voidable at the instance of the persons mentioned in the above rule. But if the
judgment-debtor, knowing of an irregularity or fraud, allows the sale to proceed without
any objection, he will be estopped from impeaching the sale on the ground of irregularity

45
or fraud, though substantial injury has been caused. (Arunachellam v. Arunachellam,
(1889) 15 I.A. 171)

(c) The purchaser at a sale of immovable property in execution of a decree can also
apply to the Court to set aside such a sale on the ground that the judgment-debtor had
no saleable interest in such property. (R. 91)

Here is thus an exception to the general principle that a Court-sale carries with it no
guarantee that the property sold is the property of the judgment- debtor. This rule allows
an auction-purchaser to set aside a sale by an application under this rule on the ground
that the judgment-debtor had no saleable interest in the property sold. The object of the
rule is to provide a quick and inexpensive remedy in such cases by which the auction-
purchaser could get a speedier remedy.

When immovable property is sold in execution of a decree and such sale has become
absolute, the property is deemed to have vested in the purchaser from the time when
the property is sold, and not from the time when the sale becomes absolute. (S. 65)

If no application is made to set aside a sale, or if such an application is made but

disallowed, the Court passes an order confirming the sale, and thereupon, the sale
becomes absolute. When such a sale has become absolute, the Court grants a
certificate specifying the property sold, the name of the purchaser, and the date on
which the sale has become absolute.

When the immovable property which is sold is in the possession of the judgment-debtor
(or some person on his behalf) and a certificate has been issued (as stated above), the
Court orders delivery to be made by putting such purchaser or any other person
mentioned by him in possession of the property. and if need be, any person who
refuses to vacate the property may be removed therefrom. (R. 95)

If, however, such property is in the occupancy of a tenant and a certificate has been
issued (as above), the delivery is to be made by affixing a copy of the certificate in some
conspicuous place on the property and by proclaiming to the occupant (by beat of drum
or some other customary mode) that the interest of the judgment-debtor has been
transferred to the purchaser. (R. 96)

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If the decree-holder or purchaser of immovable property is resisted or obstructed by any
person in obtaining possession of such property, he can apply to the Court, and after
determining the questions raised, the Court may:

(a) make an order allowing the application and directing that the applicant be put into
the possession of the property, or dismissing the application; or

(b) pass such other order as in the circumstances of the case it may deem fit.

If, despite the Court's order directing possession to be given to the applicant, the latter
is still resisted or obstructed in obtaining possession, the Court can order the judgment-
debtor or any person acting in his behalf or at his instigation, to be detained in civil
prison for any term which may extend upto thirty days. (S. 75 & R. 98, O. XXI)

Lastly, it may be noted that an order passed by the Court with reference to resistance to
delivery of possession to the decree-holder or purchaser (as the case may be) has the
same force as a decree, and is appealable to the same extent as if it was a decree. (R.
103)

Bibliography

N.H. Jhabvala, The Code of Civil Procedure 2023

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