CLAIM PETITIONS IN EXECUTION
INTRODUCTORY: The term “Execution” means the process for enforcing or giving effect to the judgment of the court. But, objection to attachment of property under Order XXI, Rule 58, are frequency responsible for great delay in the disposal of the execution cases. In relation to the difficulties faced by a decree holder in execution of the decree, in 1872, the Privy Council had observed that
“…….the difficulties of a litigant in India begin when he has obtained a Decree……”.
Even in 1925, while quoting the aforestated judgment of the Privy Council in the case of Kuer Jang Bahadur vs. Bank of Upper India Ltd., Lucknow (AIR 1925 Oudh 448), the Court was constrained to observe that
“Courts in India have to be careful to see that process of the Court and law of procedure are not abused by the judgment-debtors in such a way as to make Courts of law instrumental in defrauding creditors, who have obtained decrees in accordance with their rights.”
The Law relating to execution of decrees is to be found in Sections 36 to 74, Sections 82 and 135; and Order XXI of the Code of Civil Procedure as amended by the Andhra Pradesh High Court. These Provisions should be carefully studied and strictly followed. No doubt, objection to attachment of property under Order XXI, Rule 58, are responsible for great delay in the disposal of the execution petitions. Such objections are at time collusive and should be scrutinized with care and disposed of promptly. Adjudication of such objections or claims should be confined to the points indicated in Rules 58 and 59 of Order XXI. Adjudication of any claim or objection is appealable like a decree. Inasmuch as this paper is confined to ‘Claim petitions’, it is seminal to refer to the meaning of ‘adjudication’.
Meaning of ‘adjudication’ in the Law Lexicon dictionary as herein:
“Adjudication the legal process of resolving a dispute. The final giving or pronouncing the judgment and decree in a Court proceedings ft implies a hearing of a Court after notice of legal evidence of factual issues involved. (Black’s law Dictionary, 16th Edition, Page 42).” See. K.B.V. Nagabhushana Gupta vs Ramadugu Venkateswara Rao, 1996 (3) ALT 100.
Section 47 of CPC:
Section 47 of C.P.C. mandates that all questions, arising between the parties to the suit, in which the decree was passed, or the persons claiming through them, shall be determined by the Executing Court, and not by a separate suit. See. Vegendla Subba Rao vs Puvvada Srinivasa Rao And Ors., AIR 2005 AP 449, 2005 (5) ALD 260, 2005 (6) ALT 106
OBJECTIONS TO ATTACHMENT:
1) Provision for the restoration of claim petition:- When the Court dismisses any claim petition under Order 21 Rule 58(1), the party may file an application under Section 151 CPC for restoration and for re-investigation or he may also file a suit under Order 21 Rule 58(5) within one year from the date of dismissal for default.
2) If claim petition is filed belatedly, Court may refuse it.
It should be noted if an objection appears to have been„designedly or unnecessarily delayed‟ (or where, before the claim is preferred or objection is made, the property attached has already been sold), the Court has power to refuse (adjudicate) the claim and dismiss the petition and leave the petitioner to institute a suit under sub-rule (5) of Rule 58, Order 28 CPC for the purpose.
3) Full Inquiry in claim petition is essential —Objection to attachment of property under Order XXI, Rule 58, are frequency responsible for great delay in the disposal of the execution cases. Such objections are at time collusive and should be scrutinised with care and disposed of promptly. Adjudication of such objections or claims should be confined to the points indicated in Rules 58 and 59 of Order XXI.
4) Adjudication of any claim or objection is appealable like a decree :- Adjudication of claim petition is like a suit and so it is appealable like a decree. When the Court dismiss any claim or objection under Order 21 Rule 58(1), the party may file an application under Section 151 CPC for restoration and for re-investigation or he may also file a suit under Order 21 Rule 58(5) within one year from the date of dismissal for default.
5) Power to dismiss objection out trial—It should be noted if an objection appears to have been„designedly or unnecessarily delayed‟ (or where, before the claim is preferred or objection is made, the property attached has already been sold), the Court as power to refuse (adjudicate) the claim and dismiss the petition and leave the petitioner to institute a suit under sub-rule (5) of Rule 58, Order 28 CPC for the purpose.
6) What is the condition precedent for maintainability of a claim application?
Proceedings by way of claim are applicable only in cases of money decrees where property of the judgment-debtor has been attached. The language of Order 21 Rule 58 of C. P. C. itself makes clear that a claim can be maintained only where an attachment is subsisting. See. K.L.Geetha Nandini and another vs. K.L.Nagaraju and another , LAWS(APH)-2009-6-6, 2009 (3) APLJ 79 (AP)., Malireddy Veera Venkata Padmavathi vs. Central Bank of India, Samalkot 1998(3)An.W.R46.
7) The law is well-settled that a claim petition under Order 21 Rule 58 of C. P. C. cannot be maintained in execution of mortgage decrees. See. K.L.Geetha Nandini and another vs. K.L.Nagaraju and another , LAWS(APH)-2009-6-6, 2009 (3) APLJ 79 (AP). See also. No claim petition would lie and be maintainable. Indian Bank, Nidadavolu Kovvuru Vs Nallam Veera Swamy and others 2015(1) ALD 278
8) Cause of action to prefer claim. See. Gopana subba Rayudu vs. Pasupuleti Venkataramana 2009 (6) Ald 544.
9) When a claim petition can be preferred? As was held in Kancharla Lakshmi Narayana Vs Mataparthi Shyamala, 2008(5) ALD 55 SC, a claim petition can be preferred even after sale but before confirmation of sale.
10) Burden of proof on the claimant. See. Rahatunnisa Vs Md.Shabbir Ali Khan reported in 2008(5) ALD 615
11) Whether property sold prior to attachment can be sold in execution of decree. See. Adinarayana Vs S.Gafoor Saheb, AIR 2004 AP 377, T.Nabisaheb Vs V.P.Shivaiah, 2004 (6) ALD 488
12) Purchaser of joint share prior to final decree cannot object for execution for recovery of means profit against the property of his vendor. See. Kavuri Venkataramanamma Vs. Kavuri NarayanaRao, 2011 (1) ALD 669; Ramesh Kumar Jain Vs Ghanshyam Das Rathi, 2011 (5) ALD 354
13). Locus standi to raise in Wakf property. See. SM Khasimvali Vs Shivaji 2008(2) ALD 742
14). The legal representatives of the deceased Jdr can file separate suit for declaration of thier rightrs in attached property.See. Varanasi Krishna murthy (died) and others Vs Dasyam Shanmukharao and another, 2008 (2) ALD 327
15). A person who has raised his claim once under O.21 R.58 CPC unsuccessfully cannot reagitate the same claim under O.21 R.97 CPC. See. M.Padma Vs.M.Seshagiri rao,2003 (5) ALD 3
16). Suit to set aside the order in the application under O.21 R.58 is not maintainable. See. Pallamreddy Mastan Reddy Vs. Nellore Finance corporation AIR 1993 AP 29 FB., Kothapalli Koteswararao Vs Murukonda Subbarao,2002(6) ALD 609
17). Order under O.21 R.58 is appealable under O.41. Revision does not lie. See. Ushasri Agro Agencies (Chit funds), Khammam Vs Giridhar Auto Finance Pvt. Ltd., Khammam, 2003 (2) ALD 370
18). Difference between claims under O.21 R.58 and R.23(7) of Rent control rules 1961. See. Ramesh Kumar Jain Vs Ghanshyam Das Rathi, 2011 (5) ALD 354.
19). Claim petition under O.21 R.58 for declaring ownership rights of claimant over EP schedule property and to raise attachment over said property. Claimant is none other than the wife of the Jdr. (Fradulent transfer legal position). See. Ietham Venkata Anjani Vs Ganeshula Uma Parvathy and another 2015 (6) ALD 504.
20). O.21 R.59 Stay of delivery procedings pending claim petition filed by third party purchaser. See. E.Aruna Vs. Vemula Srinu and others 2015 (5) ALD 676.
21). O.21 R.58 Claim petition allowing of appeal agaisnt dismissal of justification. See. Ch.Venkatarao (died) and others Vs. JR Rameshji and another 2014(3) ALD 403 (DB). See also. Mohd. Khadeer and others Vs K.Venkatasham and others 2014 (1 ) ALD 708
22). The true object and the purpose of an attachment. Sardar Govindrao Mahadik & Anr vs Devi Sahai & Ors,1982 AIR 989, 1982 SCR (2) 186. The true object and the purpose of an attachment which is as under:
“The sole object behind the order levying attachment before judgment is to give an assurance to the plaintiff that his decree it made would satisfied. It is a sort of a guarantee against decree becoming infructuous for want of property available from which the plaintiff can satisfy the decree. If attachment before judgment is obtained in a suit which ends in a decree but if in appeal the decree is set aside the attachment of necessity must fall.”
23). How long the attachment survivies?
K.B.V. Nagabhushana Gupta vs Ramadugu Venkateswara Rao, 1996 (3) ALT 100.
The attachment will subsist as long as decree is satisfied, as long as the execution petition survives, and as long as it is not nullified by virtue of the rejection of the claim of attachment under Order 21 Rule 58 of CPC.
24). K.B.V. Nagabhushana Gupta vs Ramadugu Venkateswara Rao, 1996 (3) ALT 100.
The property so attached will be sold by virtue of Order 21 Rule 64 of CPC. In other words, attachment precedes the sale. The object of attachment of a property has to be garnered in the nature and form of order of attachment either under Order 38 Rule 5 of CPC or Order 21 Rule 50 of CPC. Both from the provisions and from the prescribed order of attachment, the moment a property is attached, the judgment debtor will be prohibited from alienating the property.
25). To preserve the property
K.B.V. Nagabhushana Gupta vs Ramadugu Venkateswara Rao, 1996 (3) ALT 100.
An attachment is a mode which is adopted to preserve the property without further alienation or further encumbrances. Judged in that context, the clam petition in regard to attachment under Order 21 Rule 58 of CPC for the purpose of entertainment or adjudication would be only with reference to the attachment and nothing more than that and for the purpose of prohibiting further alienation of the property or encumbrances serves effect.
26). The claim or objection made under Rule 58 of Order 21, is almost a suit.
Pallamreddy Masthan Reddy And … vs Nellore Finance Corporation And … AIR 1993 AP 297, 1993 (2) ALT 97
27). Under Order 21 Rule 58 CPC, the Court has to pass a speaking order, especially when it is an appealable order. See. Tamilnad Mercantile Bank Ltd vs R.Rangaswamy, C.R.P (NPD) No.4173 of 2009 and M.P.No.1 of 2009, Dt. 13.04.2010
28). No regular appeal is contemplated as provided u/s 96 of C.P.C. But a Civil Miscellaneous Appeal alone is contemplated.
In 2004(2) M.L.J.105 (cited supra) held that on a careful analysis of the relevant provisions of the definition of a decree in Section 2(2)(a) C.P.C., S.104(1)(i) R/W Order 21 Rule 58(4) C.P.C, no regular appeal is contemplated as provided u/s 96 of C.P.C. But a Civil Miscellaneous Appeal alone is contemplated.
29). The adjudication of the execution Court in a claim petition filed under Order 21 Rule 58 is deemed to be a decree and therefore only an appeal will lie against an order of adjudication. See. P.Madhavan v. Periyakaruppan – C.R.P.NPD.(MD).No.966 of 2006  RD-TN 926 (13 March 2007).
30) The more crucial amendments with which we are concerned in the present case are the substitution of Rules 58 and 59 in the place of old Rules 58 to 63. Rules 60 to 63 stand deleted. Rule 58 has been recast. The new Rule 59 deals with the same subject matter viz., stay of sale, as the old sub-rule (2) of Rule 58 and it is an improvement over that sub-rule. The sub-heading — “Investigation of claims and objections” was substituted as “Adjudication of claims and objections” in keeping with the content of amendment of Rule 58.
31). No separate suit is required to be filed
In execution proceedings, to decide all questions relating to right, title or interest in the property, no separate suit is required to be filed by the parties. (See. Order 21, rule 58 (2) CPC). See. Tamilnadu Mercantile Bank Ltd vs R.Rangaswamy. Date of Judgment on 13 April, 2010.
32). Where the execution involves dispossession of third parties, such claims have to be determined in the applications filed under Rule 58 of Order 21 C.P.C.
Where the execution involves dispossession of third parties, such claims have to be determined in the applications filed under Rule 58 of Order 21 C.P.C. Determination of the rights of third parties vis-a-vis the suit schedule properties is not at all in the realm of the partition suits. The adjudication that gives rise to a preliminary or final decree cannot at all defeat the rights of third parties. The parties are required to take and receive the shares allotted to them, on as is where is basis. See.Pillela Jangappa vs Garlapati Prakasam And Ors.
2006 (4) ALD 454
33). For adjudication of rights of third parties, in relation to a decree
In the ordinary course of things, any objections, raised by third parties, are required to be raised by filing applications under Rules 58, 97 or 99 of Order 21, r/w Sec. 47 C.P.C. However, a perusal of sub-rule (4) of Rule 92 of Order 21 discloses that it is permissible, to file a suit, challenging the very title of the judgment-debtor, to the properties involved in the matter. The only condition is that the auction-purchaser, the decree-holder and judgment-debtor shall be made parties to it. See. Kukkala Balakrishna vs Vijaya Oil Mill And Ors., AIR 2006 AP 98, 2006 (1) ALD 360
CLAIM PETITIONS UNDER ORDER 21, RULES 97, 98, 99, AND 101 OF CPC.
1) Courts duty to adjudicate the claim by third party, See. Nooruddin Vs Dr.K.L.Anand, (1995) 1 SSC 242; Brahmdeo Choudhary Vs Rishikesh Prasad Jaiswal (1997) 3 SSC 694
2). Transferee pendenti lite is bound by the decree. See. Velugulla Satyanarayana Murthy VS Alluri Annapurnamma, 1992 (1) ALT 371
3). A tenant is transferee pendenti lite if let into possession after decree. See. Profit Shoe Company ltd., Vs.S.Krishna Reddy, AIR 2010 AP 163
4). Judgment debtor cannot apply under Order 21 R.97 CPC. See. Nakka Perumal Reddy Vs. Pandiripalli Lakshmi Prasad, 2009 (5) ALD 634
5). “Any person includes Jdr and he can raise objection – when”. See. Ranchod Vs Hukumji AIR 2011 MP 153, Bhanvarlal Vs Satyanarayan and another AIR 1995 SC 358
6). Scope of enquiry in adjudication under R.97 to 103. See. Barla Ramesh Vs VV Markandeya 2008 (5) ALD 714.
7). O.21 R.58, 97 and 99 Applications and distinction there between. See. Dachapalli Kondalu Vs Peddanti Chandrashekar and others, 2014 (4) ALD 467. See also. Mayadevi Vs Lalta Prasad Supreme Court Judgment February, 19, 2014 dealt Hon’ble SC recently on the aspect of O.21 R.58
8) Auction-purchaser can avail the remedy of filing suit for possession. See. Pattam Khader Khan vs Pattam Sardar Khan & Anr, 1996 SCC (5) 48, JT 1996 (6) 201. However, it is interesting to see the ruling of Hon’ble AP High Court in Vegendla Subba Rao vs Puvvada Srinivasa Rao And Ors, 2005 (6) ALT 106 When law stipulates that the only method, through which an auction-purchaser can recover the property purchased by him, is by filing an application under Rule 95 of Order 21 CPC, the 1st respondent cannot be permitted to avail that relief indirectly, after it became barred.
9). Whether an application under Rule 95 or 96 of Order 21 C.P.C., or to file a separate suit?
The purport of Explanation-II of Section 47 C.P.C. was not canvassed before the Supreme Court, obviously because the occasion did not arise. In the teeth of clear, unequivocal and unambiguous prohibition contained in section 47 against filing of a suit by an auction-purchaser to recover the possession of the property purchased by him, it is difficult to treat the last sentence in Paragraph 13 of the judgment as an absolute proposition of law, with great respect to the Hon’ble Supreme Court. The permissibility of filing a separate suit in spite of the bar contained in the Explanation n of Section 47 C.P.C. did not fall for consideration before their Lordships. If such situation existed, naturally the said observation would have assumed the status of the law of the land. (Please go through rulings Pattam Khader Khan’s case (1996 SCC (5) 48) and Vegendla Subba Rao’s, 2005 (6) ALT 106)
10). Order 21 Rule 97 CPC:- A person whose claim under Rule 58 of Order 21 was dismissed cannot re-agitate the same by filling a petition under Rule 97 of Order 21. See. M. Padma vs. M.Seshagiri Rao, 2003 (4) ALT 683.
11). Adjudication under Order 21 Rule 98, 100, and 101 and its successive Rules was sine qua non to a finality of the adjudication of the right, title or interest in the immovable property under execution. See. Noorduddin vs. Dr. K.L.Anand, 1995 (1) SCJ 76.
12. The Law has determined the stage on which a person may come before the Court only on the happening of that situation and not before that. See. Satyendra Ghosh vs. Bani Bhattacharjee, 1998 (2) CCC 546 (Gau.) = 1998 (5) ALT 8.3 (DN OHC).
13. Under the scheme of Order XXI Rules 97 and 99 CPC, The claimant could get relief only on establishing a right to possession over the property. See. Ittiyachan vs. Tomy, 2001 (4) CCC 268 (Ker) (DB) = 2002 (1) ALT 5.1 (DN OHC).
14) Unless and until objections of applicant were heard, no order in execution requiring applicant to handover vacant possession of suit premises could be passed. See. Roshanlal vs. Avinash, AIR 2003 Bom., 31 = 2003 (2) alt 13.4 (DN OHC)
15). Dismissal of claim petition without holding enquiry and without giving opportunity to both the parties is not legal. See.Muvvala Ramachandra Rao vs. Kuricheti Ravi, 1999 (3) ALT 136.
16). Resistance by third party falls within the ambit of Or.21 Rule 101. See. Silverline Forum Pvt. Ltd. vs. Rajiv Trust, 1998 (3) Supreme 555.
17). Compensatory costs for false or vexatious claims or defences—The Court can order that a party who knowingly puts forward any false or vexatious claim or defence in execution proceedings shall pay costs by way of compensation to the opposite party who objects to the claim or defence on these grounds. The amendments of Section 35A and insertion of Section 35B in the Code of Civil Procedure by Act No. 104 of 1976 may be studied in this connection.
A conjoint reading of Order 21 Rules 97,98,99 and 101 CPC., projects the following picture :
(1) If a decree-holder is resisted or obstructed in execution of the decree for possession with the result that the decree for possession could not be executed in the normal manner by obtaining warrant for possession under Order 21, Rule 35, then the decree-holder has to move an application under Order 21, Rule 97, for removal of such obstruction and after hearing the decree-holder and the obstructionist the Court can pass appropriate orders after adjudcating upon the controversy between the parties as enjoined by Order 21, Rule 97, sub-rule (2), read with Order 21, Rule 98. It is obvious that after such adjudcation, if it is found that the resistance or obstruction was occasioned without just cause by the judgment-debtor or by some other person at his instigation or on his behalf, then such obstruction or resistance would be removed as per Order 21, Rule 98, sub-rule (2) and the decree-holder would be permitted to be put in possession. Even in such an eventuality the order passed would be treated as a decree under Order 21, Rule 101, and no separate suit would lie against such order meaning thereby, the only remedy would be to prefer an appeal before the appropriate appellate court against such deemed decree.
(2) If for any reason a stranger to the decree is already dispossessed of the suit property relating to which he claims any right, title or interest before his getting any opportunity to resist or offer obstruction on spot of account of his absence from the place or for any other valid reason, then his remedy would lie in filing an application under Order 21, Rule 99, CPC claiming that his dispossession was illegal and that possession deserves to be restored to him. If such an application is allowed after adjudication then as enjoined by Order 21, Rule 98, sub-rule(1), CPC the Executing Court can direct the stranger applicant under Order 21, Rule 99, to be put in possession of the property or it his application is found to be substanceless it has to be dismissed. Such an order passed by the Executing Court disposing of the application one way or the other under Order 21, Rule 98, sub-rule(1), would be deemed to be a decree as laid down by Order 21, Rule 103, and would be appelable before appropriate appellate forum. But no separate suti would lie against such orders as clearly enjoined by Order 21, Rule 101. (See. Supreme Court ruling in Brahmdeo Choudhary vs Rishikesh Prasad Jaiswal & Anr, 1997 (2) L.W 266. Also V.Krishnamoorthy vs Balakrishnan, C.R.P PD.No.1411 of 2009 and M.P.No.1 of 2009).
As was observed in Shub Karan Bubna alias Shub Karan Prasad Bubna vs. Sita Saran Bubna and Ors., (2009) 9 SCC 689 In the present system, when preliminary decree for partition is passed, there is no guarantee that the plaintiff will see the fruits of the decree. It is necessary to remember that success in a suit means nothing to a party unless he gets the relief. Therefore, to be really meaningful and efficient, the scheme of the Code should enable a party not only to get a decree quickly, but also to get the relief quickly. This requires a conceptual change regarding civil litigation, so that the emphasis is not only on disposal of suits, but also on securing relief to the litigant. I may conclude this paper quoting the observation of Hon’ble Apex Court in Satyawati Vs. Rajinder Singh And Anr., wherein it was observed as ”We are sure that the Executing Court will do the needful at an early date so as to see that the long drawn litigation which was decided in favour of the appellant is finally concluded and the appellant- plaintiff gets effective justice.”