Code of Civil Procedure, 1908 (CPC)
Setting Aside an Execution Sale: Order XXI Rules 89, 90 and 91
Once immovable property has been sold in execution, the Code of Civil Procedure, 1908 allows the sale to be undone in three, and only three, ways. Rule 89 lets a person interested in the property pay it off. Rule 90 allows a sale to be set aside for material irregularity or fraud in publishing or conducting it. Rule 91 allows the purchaser to escape where the judgment-debtor had no saleable interest. Each has a different applicant and a different requirement, and Rule 92 disposes of all three. These notes set them out.
The three routes, who may take each, and what each requires
1. Rule 89: Setting Aside on Deposit
§ Order XXI Rule 89 (in substance) (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 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 that application, be entitled to make or prosecute an application under this rule. (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. |
§ Three features • No fault need be shown. The applicant does not allege irregularity or fraud. He simply pays what the sale was meant to realise, together with a solatium of five per cent to the disappointed purchaser. • The class of applicants is wide. Any person claiming an interest in the property at the time of the sale or of the application, or someone acting for him, which covers the judgment-debtor, a co-owner, a mortgagee and others. • The choice in sub-rule (2) is real. A person who has applied under Rule 90 must withdraw that application before he can use Rule 89, so he cannot run both routes at once. |
2. Rule 90: Irregularity or Fraud
§ Order XXI Rule 90 (in substance) (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 that ground 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 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. |
§ What sub-rules (2) and (3) do • Sub-rule (2) requires two things, not one. The irregularity or fraud must be established, and substantial injury by reason of it must be proved. A sale is not set aside because the procedure was imperfect; it is set aside because the imperfection caused harm. • A low price is the usual injury alleged, and the applicant must connect it to the irregularity: that the property fetched less because of the defect in publication or conduct. • Sub-rule (3) bars a stale ground. An objection that could have been taken on or before the drawing up of the proclamation cannot be kept back and used after the sale, which is why objections to the proclamation must be raised under Rule 66 at the time. • The Explanation settles an old dispute. The absence of, or a defect in, attachment is not by itself a ground, though it may be relevant to whether there was a material irregularity causing injury. |
3. Rule 91: No Saleable Interest
§ Order XXI Rule 91 (in substance) 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. |
i. Only the purchaser may apply. This is the one route confined to a single applicant, and it exists because he is the person who has paid for nothing.
ii. Nothing turns on irregularity, fraud or injury. The complaint is not about how the sale was conducted but about what was sold.
iii. Rule 93 completes it. Where a sale is set aside under Rule 92, the purchaser is 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.
4. The Three Compared
Basis | Rule 89 | Rule 90 | Rule 91 |
|---|---|---|---|
Who may apply | Any person claiming an interest in the property at the time of the sale or of the application, or acting for him | The decree-holder, the purchaser, a person entitled to rateable distribution, or a person whose interests are affected | THE PURCHASER alone |
The ground | None: it is a right to redeem the sale by payment | Material irregularity or fraud in PUBLISHING OR CONDUCTING the sale | The judgment-debtor had NO SALEABLE INTEREST |
What must be proved | Nothing, but the deposit must be made | The irregularity or fraud AND SUBSTANTIAL INJURY resulting from it | That there was no saleable interest to sell |
What must be paid | Five per cent of the purchase money to the purchaser, and the proclamation amount to the decree-holder | Nothing | Nothing |
Bar | Sub-rule (2): not available while a Rule 90 application is pending and not withdrawn | Sub-rule (3): no ground available before the proclamation was drawn up | None stated |
Limitation | Sixty days from the date of the sale, and the deposit must be made within that period | Sixty days from the date of the sale | Sixty days from the date of the sale |
5. Rule 92: How the Applications Are Disposed Of
§ What the court does • Where no application is made, or where one is made and disallowed, the Court shall make an order confirming the sale, and thereupon the sale shall become absolute. • Where an 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 sixty days from the date of the sale, the Court shall make an order setting aside the sale. • No suit lies to set aside an order made under this rule, but a party aggrieved may appeal. • Rule 94 then provides for the grant of a sale certificate to the purchaser where the sale has become absolute, and Section 65 vests the property in him from the time when it was sold. |
6. Landmark Points
- Rule 89. A person claiming an interest may have the sale set aside on depositing five per cent of the purchase money for the purchaser and the proclamation amount for the decree-holder.
- Rule 89(2). A person who has applied under Rule 90 cannot use Rule 89 unless he withdraws that application.
- Rule 90(1). Material irregularity or fraud in publishing or conducting the sale, at the instance of the decree-holder, the purchaser, a rateable claimant, or a person whose interests are affected.
- Rule 90(2). No sale is set aside unless the applicant proves SUBSTANTIAL INJURY by reason of the irregularity or fraud.
- Rule 90(3) and the Explanation. No ground available before the proclamation was drawn up, and the absence of or defect in attachment is not by itself a ground.
- Rule 91. The purchaser alone may apply on the ground that the judgment-debtor had no saleable interest.
- Rule 92. The sale is confirmed and becomes absolute, or is set aside; a Rule 89 deposit must be made within sixty days of the sale.
- Rules 93 and 94 with Section 65. Repayment of the purchase money where the sale is set aside; a sale certificate where it becomes absolute, the property vesting from the time of the sale.
7. Frequently Asked Questions
Who may apply under Rule 89?
Any person claiming an interest in the property sold at the time of the sale or at the time of making the application, or a person acting for or in the interest of such a person. It is not confined to the judgment-debtor.
What must be deposited under Rule 89?
Two sums: five per cent of the purchase money, for payment to the purchaser, and the amount specified in the proclamation of sale as that for the recovery of which the sale was ordered, less anything the decree-holder has since received.
Is irregularity alone enough to set aside a sale under Rule 90?
No. Sub-rule (2) requires the court to be satisfied, upon the facts proved, that the applicant has sustained substantial injury by reason of the irregularity or fraud. The defect must be shown to have caused harm.
Can an objection to the proclamation be raised after the sale?
No. Sub-rule (3) provides that no application 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.
Does a defect in attachment invalidate the sale?
Not by itself. The Explanation to Rule 90 provides that the mere absence of, or defect in, attachment of the property sold shall not by itself be a ground for setting aside the sale under that rule.
Who may apply under Rule 91?
The purchaser alone, on the ground that the judgment-debtor had no saleable interest in the property sold. It is the only one of the three routes confined to a single class of applicant.
Can a person use both Rule 89 and Rule 90?
Not at the same time. Under Rule 89(2), a person who has applied under Rule 90 to set aside the sale of his immovable property is not entitled to make or prosecute an application under Rule 89 unless he withdraws the Rule 90 application.
What is the time limit?
Sixty days from the date of the sale, under Article 127 of the Limitation Act, 1963, and in a Rule 89 application the deposit itself must be made within that period, as Rule 92(2) requires.
8. Related Topics in This CPC Series
- Sale of Attached Property in Execution
- Title of the Auction Purchaser under Section 65
- Claims and Objections to Attachment: Order XXI Rule 58
- Execution of Decrees: Sections 36 to 74 and Order XXI