PANJAB UNIVERSITY, CHANDIGARH
UNIVERSITY INSTITUTE OF LEGAL STUDIES
A PROJECT REPORT PREPARED ON THE TOPIC:
Setting aside and confirmation of execution sale (Order XXI, Rules 89-94)
Submitted To: Submitted By:
Dr. Karan Jawanda Name- Divyajot Kaur Bhasin
Section- A
Roll number- 28
Subject- Civil Procedure including Limitation Law-II
Semester- 8th
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ACKNOWLEDGEMENT
Presentation, inspiration, and motivation have always played a key role in the success of any
venture.
I express my sincere thanks to Professor Renu Vig, Vice- Chancellor, Panjab University,
Chandigarh, India.
I pay my deep sense of gratitude to Prof. Shruti Bedi (Director) of University Institute of Legal
Studies, Panjab University, Chandigarh to encourage me to the highest peak and for providing
me the opportunity to prepare the project. I am immensely obliged to my friends for their
elevating inspiration, encouraging guidance, and kind supervision during the completion of my
project.
I feel to express my indebtness and a deep sense of gratitude to my guide Dr. Karan Jawanda
whose valuable guidance and kind supervision given to me throughout the course shaped the
present work as its shown.
Last, but not least, my parents are an immensely important source of inspiration for me. So,
with due regard, I express my gratitude towards them.
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TABLE OF CONTENTS
TABLE OF CASES ....................................................................................................................4
LIST OF ABBREVIATION ........................................................................................................5
INDEX OF AUTHORITIES .......................................................................................................6
LEGISLATIONS REFERRED ................................................................................................6
BOOKS REFERRED...............................................................................................................6
LEGAL WEBSITES ................................................................................................................6
INTRODUCTION ......................................................................................................................7
ORDER 21..................................................................................................................................7
PROVISIONS UNDER RULE 89-94 OF ORDER XXI CPC ......................................................8
RULE 89 .................................................................................................................................8
RULE 90 ............................................................................................................................... 11
RULE 91 ............................................................................................................................... 12
RULE 92 ............................................................................................................................... 13
RULE 93 ............................................................................................................................... 14
RULE 94 ............................................................................................................................... 15
CONCLUSION ......................................................................................................................... 15
BIBLIOGRAPHY ..................................................................................................................... 16
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TABLE OF CASES
SERIAL NUMBER TITLE OF THE CASE PAGE NUMBER
1 Aarifaben Yunusbhai Patel 7
v. Mukul Thakorebhai Amin
2 Charn Chandra Ghosh v. 10
Rai Behari Lal
3 P.K. Unni v. Nirmala 9
Industries
4 Sagar Mahila Vidyalaya v. 15
Pandit Sadasiv Rao
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LIST OF ABBREVIATION
ABBREVIATION WORD
v. Versus
CPC The Code of Civil Procedure
& and
s. Section
SCC Supreme Court Cases
AIR All India Reporter
SC Supreme Court
Or. Order
R. Rule
Art. Article
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INDEX OF AUTHORITIES
LEGISLATIONS REFERRED
1. The Code of Civil Procedure, 1908.
2. The Limitation Act, 1963
BOOKS REFERRED
1. Takwani, C.K. (2022). Civil Procedure. EBC Publications.
LEGAL WEBSITES
1. www.ipleaders.in
2. www.lawbhoomi.com
3. www.legalserviceindia.com
4. www.lawyersclubindia.com
5. www.lawzonline.com
6. www.writinglaw.com
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INTRODUCTION
Rules 89 to 92 of Order XXI deal with setting aside of sale. When a property is sold in execution
of a decree, an application for setting aside sale may be made under these provisions by the
persons affected and the grounds mentioned therein. Such an application has to be made within
the prescribed period of limitation (60 days) 1. But an application to set aside sale of immovable
property cannot be made on any other ground not covered by Rules 89 to 91. In other words, the
provisions of Rules 89 to 91 of Order 21 as to setting aside execution sale are exhaustive.
Section 5 of the Limitation Act which deals with the extension of time or condonation of delay is
not applicable to proceedings under Order 21 Rule 90 CPC and therefore, the delay, if any in
filing of proceedings under Order 21 Rule 90 CPC, cannot be condoned under section 5 of the
Limitation Act as held in the case of Aarifaben Yunusbhai Patel v. Mukul Thakorebhai
Amin.2
Rule 93 deals with the effect of setting aside sale. Where a sale of immovable property has been
set aside, the purchase is entitled to refund of the purchase money paid by him with or without
interest as condoned by the court. An application under this rule can be filed within three years
from the date of the order setting aside the sale. 3
Rule 94 deals with the certificate of sale. According to this rule, if the sale has become absolute,
the court shall grant a certificate in favour of the purchaser.
ORDER 21
Order 21 of the Code of Civil Procedure, 1908, provides for the procedure to be followed when a
decree is passed by a court. This Order states that the decree must be signed by the judge, and
1
The Limitation Act, 1963 (Act 36 of 1963), art. 127.
2
(2020) 5 SCC 449.
3
Supra note 1.
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then the decree must be entered in the register of decrees. It further states that the decree should
be dated and authenticated by the judge’s signature. The decree is to be entered in the register of
decrees in chronological order and authenticated by the judge’s signature or the court’s seal. The
decree shall be kept in the register of decrees and open to inspection by the parties to the suit or
their representatives. The order also states that the court shall issue a certified copy of the decree
to the parties or their representatives. The signed decree shall be deemed authentic and binding
on the parties to the suit.
PROVISIONS UNDER RULE 89-94 OF ORDER XXI CPC
RULE 89
89. Application to set aside sale on deposit.- (1) Where immovable property has been sold in
execution of a decree, any person claiming an interest in the property sold at the time of the sale
or at the time of making the application, or acting for or in the interest of such person,] may
apply to have the sale set aside on his depositing in court,—
(a) for payment to the purchaser, a sum equal to five per cent of the purchase money, and
(b) for payment to the decree holder, the amount specified in the proclamation of sale as that for
the recovery of which the sale was ordered, less any amount which may, since the date of such
proclamation of sale, have been received by the decree holder.
(2) Where a person applies under rule 90 to set aside the sale of his immovable property, he
shall not, unless he withdraws his application, be entitled to make or prosecute an application
under this rule.
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(3) Nothing in this rule shall relieve the judgment debtor from any liability he may be under in
respect of costs and interest not covered by the proclamation of sale.4
Nature and scope: Rule 89 of Order 21 provides for setting aside execution sale on payment of
five percent of purchase price to the auction- purchaser and entire amount specified in the
proclamation for sale to the decree- holder.
Object: Rule 89 deals with the setting aside of sale on the deposit of the amount specified in the
proclamation of sale. The underlying object of this rule is to give a judgement- debtor the “last
chance” of saving his property by getting the sale set side before it is confirmed by the court. It is
intended to afford an opportunity to the judgement- debtor, even after the property is sold, to
satisfy the claim of the decree- holder and to compensate the auction- purchaser by paying him
five percent of the purchase money. The rule being in the nature of a concession must be strictly
complied with. The words, “on his depositing in court” show that deposit is a condition
precedent to the making of an application to set aside a sale as held in the case of P.K. Unni v.
Nirmala Industries.5
Who may apply? Any person claiming any interest as existing at the time of the sale or at the
time of making an application may avail of the benefit of Rule 89. The expression “interest” has
a very wide import and should be construed liberally so as to enable a party having any inchoate
right to apply under this rule.
Thus, the following persons are entitled to apply under the Rule 89:
(i) A judgement debtor;
(ii) A co-sharer in the property;
(iii) A member of a Joint Hindu Family;
(iv) Receiver;
(v) A creditor of judgement- debtor;
(vi) A beneficial owner;
(vii) A lessee;
(viii) A mortgagee;
4
The Code of Civil Procedure, 1908 (Act 5 of 1908), O21 R89.
5
(1990) 2 SCC 378.
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(ix) A person in possession of the property;
(x) A benamidar, transferee, etc.
In case of manifest illegality in conducting the sale, the court may take proceedings suo motu and
set aside the sale even after the expiry of the period of limitation prescribed therefore.
Conditions: The provisions of Rule 89 are not intended to defeat the claim of the decree- holder
or the auction- purchaser, unless the decree is simultaneously satisfied. Rule 89, therefore,
requires that two primary conditions relating to deposit must be fulfilled, namely,
(i) the applicant must deposit in the court for payment to the auction- purchaser five
percent of the purchase money; and
(ii) he must also deposit the amount specified in the proclamation of sale, less any
amount received by the decree- holder since the date of proclamation of sale for
payment to the decree- holder.
Such deposit must be unconditional and not under protest. Further, it must be in cash and not by
cheque or Government promissory note.
Limitation: An application to set aside a sale must be made within a period of sixty days from
the date of the sale. The executing court has no jurisdiction to entertain an application for setting
aside a sale after the prescribed period by invoking Section 148 of the Code or by applying
Section 5 of the Limitation Act.
Notice: Before an order setting aside a sale is made, notice of the application must be given to all
persons likely to be affected by the order thereon. Since the object of giving notice is to give an
opportunity of hearing to the interested party, if he is aware of the application, the absence of a
formal notice does not vitiate the proceedings as held in the case of Charn Chandra Ghosh v.
Rai Behari Lal.6
Appeal: An order setting aside a sale or refusing to set aside a sale under Rule 92 is appealable.
6
AIR 1925 Cal 157.
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RULE 90
90. Application to set aside sale on ground of irregularity or fraud.- (1) Where any
immovable property has been sold in execution of a decree, the decree holder, or the
purchaser, or any other person entitled to share in a rateable distribution of assets, or whose
interests are affected by the sale, may apply to the court to set aside the sale on the ground of
a material irregularity or fraud in publishing or conducting it.
(2) No sale shall be set aside on the ground of irregularity or fraud in publishing or
conducting it unless, upon the facts proved, the court is satisfied that the applicant has
sustained substantial injury by reason of such irregularity or fraud.
(3) No application to set aside a sale under this rule shall be entertained upon any ground
which the applicant could have taken on or before the date on which the proclamation of sale
was drawn up.
Explanation : The mere absence of, or defect in, attachment of the property sold shall not, by
itself, be a ground for setting aside a sale under this rule.7
Nature and Scope: A sale of immovable property in execution can be set aside also on the
ground of material irregularity or fraud in publishing or conducting the sale, provided the
applicant proves that he has sustained substantial injury by reason of such irregularity or
fraud. The pre- sale illegalities committed in the execution are amendable to the remedy under
Section 47. Post- sale irregularities causing substantial injury to the judgment- debtor are
covered under Rule 90 of order 21.
Who may apply? The following persons have been judicially held entitled to apply under this
rule:
(i) the decree- holder;
(ii) the auction- purchaser;
(iii) any person entitled to share in a rateable distribution to assets;
7
Supra note 4, R90.
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(iv) any person whose interests are affected by the sale.
Grounds: Before a sale can be set aside under this rule, it must be shown that:
(i) there has been a material irregularity or fraud in publishing and conducting the
sale; and
(ii) substantial injury has been caused to the applicant.
RULE 91
91. Application by purchaser to set aside sale on ground of judgment-debtor having no
saleable interest- The purchaser at any such sale in execution of a decree may apply to the
Court to set aside the sale, on the ground that the judgment-debtor had no saleable interest in
the property sold.8
Nature and Scope: Rule 91 enables the auction- purchaser to apply for setting aside the sale
on the ground that the judgment- debtor has no saleable interest in the property. This
provision is an exception to the general rule of caveat emptor (let the buyer beware).
Object: The rule is intended for the protection of an innocent auction- purchaser; and it
cannot, therefore, be invoked where the purchaser knew at the time of the sale that the
judgment- debtor has no saleable interest in the property.
Who may apply? It is only the auction- purchaser who can apply under this rule. A decree-
holder auction- purchaser can also apply. A judgment- debtor cannot apply under this rule.
Saleable interest: The expression “no saleable interest” means no saleable interest at all.
Hence, where the judgment- debtor has some saleable interest, however small it may be, this
rule does not apply and the sale cannot be set aside on the ground that the judgment- debtor
did not have full saleable interest in the property.
8
Supra note 4, R91.
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RULE 92
92. Sale when to become absolute or be set aside.- (1) Where no application is made under
rule 89, rule 90 or rule 91, or where such application is made and disallowed, the court shall
make an Order confirming the sale, and thereupon the sale shall become absolute:
Provided that, where any property is sold in execution of a decree pending the final disposal
of any claim to, or any objection to the attachment of, such property, the court shall not
confirm such sale until the final disposal of such claim or objection.
(2) Where such application is made and allowed, and where, in the case of an application
under rule 89, the deposit required by that rule is made within 1 [sixty days] from the date of
sale, or in cases where the amount deposited under rule 89 is found to be deficient owing to
any clerical or arithmetical mistake on the part of the depositor and such deficiency has been
made good within such time as may be fixed by the court, the court shall make an Order
setting aside the sale:
Provided that no Order shall be made unless notice of the application has been given to all
persons affected thereby:
Provided further that the deposit under this sub-rule may be made within sixty days in all such
cases where the period of thirty days, within which the deposit had to be made, has not
expired before the commencement of the Code of Civil Procedure (Amendment) Act, 2002.
(3) No suit to set aside an Order made under this rule shall be brought by any person against
whom such Order is made.
(4) Where a third party challenges the judgment debtor title by filing a suit against the
auction purchaser, the decree holder and the judgment debtor shall be necessary parties to
the suit.
(5) If the suit referred to in sub-rule (4) is decreed, the court shall direct the decree holder to
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refund the money to the auction purchaser, and where such an Order is passed the execution
proceeding in which the sale had been held shall, unless the court otherwise directs, be
revived at the stage at which the sale was ordered. 9
No sale of immovable property shall become absolute until it is confirmed by the court.
Where no application to set aside the sale is made under rule 89, 90 or 91 or where such
application is made and is disallowed by the court, the court shall make an order confirming
the sale, and thereupon the sale shall become absolute. Once the order is made under Rule 92
confirming the sale, the title of the auction- purchaser relates back to the date of sale.
While confirming a sale, the court must adopt a practical and realistic approach. It may
consider the fair value of the property, the general economic trends, the large sum required to
be produced by the bidder, the formation of a syndicate, the futility of postponements and the
possibility of litigation and several other factors dependent on the facts of each case.
No speaking order is necessary. Proviso to sub- rule (I) of Rule 92 as added by the
Amendment Act of 1976 enacts there where a claim against attachment in execution of a
decree has been made but the property attached has been sold pending the determination of
such claim, the sale should not be confirmed by the court before the final disposal of such
claim.
RULE 93
93. Return of purchase-money in certain cases- Where a sale of immovable property is set
aside under rule 92, the purchaser shall be entitled to an order for repayment of his purchase-
money, with or without interest as the Court may direct, against any person to whom it has
been paid.10
Where a sale of immovable property has been set aside, the purchaser is entitled to refund of
the purchase money paid by him with or without interest as ordered by the court. An
application under this rule cab be filed within three years from the date of the order setting
9
Supra note 4, R92.
10
Supra note 4, R93.
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aside the sale.11
RULE 94
94. Certificate to purchaser—Where a sale of immovable property has become absolute, the
Court shall grant a certificate specifying the property sold and the name of the person who at
the time of sale is declared to be the purchaser. Such certificate shall bear date the day on
which the sale became absolute. 12
After the sale has become absolute, the court shall grant a certificate in favour of the
purchaser. It shall bear the date on which the sale became absolute and also specify the
property sold and the name of the purchaser
Issuance of a certificate is merely a formal declaration by the court and neither extinguishes
nor creates any title. The object of such a certificate is to avoid any controversy regarding the
identity of the property sold and the purchaser thereof and the date when the sale became
absolute. Issuance of a certificate is a ministerial act as held in the case of Sagar Mahila
Vidyalaya v. Pandit Sadasiv Rao.13
CONCLUSION
The provisions contained in Order 21 covers different types of situation and provide effective
remedies to the judgment-debtors, claimant objectors and third parties apart from the decree-
holder. The Code takes care of the rights of judgment-debtors too. Various modes of
execution of a decree are also provided by the Code which includes arrest, detention of the
judgment-debtor, delivery of possession, attachment of the property, by sale, partition, the
appointment of receiver and payment of money etc. Thus, the provisions are rendered
effective or capable of giving relief to an aggrieved party.
11
Supra note 1.
12
Supra note 4, R94.
13
(1991) 3 SCC 588.
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BIBLIOGRAPHY
Takwani, C.K. (2022). Civil Procedure. EBC Publications.
All about Order XXI of the Civil Procedure Code, 1908. lawyersclubindia.
https://www.lawyersclubindia.com/articles/all-about-order-xxi-of-the-civil-procedure-
code-1908-15944.asp (accessed on 23/2/2024 at 11:13 am)
Execution of a Decree under Code of Civil procedure, 1908. ipleaders.
https://blog.ipleaders.in/execution-decree/#Conclusion (accessed on 23/2/2024 at 6:51
pm)
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