Order 21 Rule 77 CPC - Sale by Public Auction
Order XXI Rule 77 of the Code of Civil Procedure, 1908 governs payment, completion and equal bids when movable property is sold by public auction in execution of a decree.
Text of Order XXI Rule 77 - Sale by Public Auction
(1) Where movable property is sold by public auction the price of each lot shall be paid at the time of sale or as soon after as the officer or other person holding the sale directs, and in default of payment the property shall forthwith be re-sold.
(2) On payment of the purchase-money, the officer or other person holding the sale shall grant a receipt for the same, and the sale shall become absolute.
(3) Where the movable property to be sold is a share in goods belonging to the judgment-debtor and a co-owner, and two or more persons, of whom one is such co-owner, respectively bid the same sum for such property or for any lot, the bidding shall be deemed to be the bidding of the co-owner.
Meaning and Legal Effect of Rule 77
Rule 77(1): Payment at the auction and immediate resale
The successful bidder must pay the price for each lot at the auction or within the time directed by the officer or other person conducting it. If the bidder does not pay as required, the property must be put up for resale forthwith. The rule concerns the auction of movable property, not the distinct procedure for sale of immovable property.
Rule 77(2): Receipt and when the sale becomes absolute
Once the purchase money is paid, the person conducting the sale must issue a receipt. Under this rule, the sale becomes absolute on payment of the purchase money. A bidder should retain the receipt as evidence of payment and completion of the sale.
Rule 77(3): Preference for a co-owner in equal bids
When the judgment-debtor's share in jointly owned goods is auctioned and a co-owner bids the same amount as another bidder, the co-owner's bid is treated as the successful bid for that tie. This is a tie-breaking preference, not an unrestricted right to purchase at a lower price.
Key Terms Explained
- Movable property: Property other than immovable property, such as goods and other movable assets, subject to the applicable execution rules.
- Judgment-debtor: A person against whom a decree has been passed or an order capable of execution has been made (Section 2(10), CPC).
- Decree-holder: A person in whose favour a decree has been passed or an order capable of execution has been made (Section 2(3), CPC).
- Lot: An individual item or group of items offered as one unit in an auction.
- Sale becomes absolute: The sale attains the finality prescribed by Rule 77(2) upon payment, subject to any applicable legal remedies or overriding orders.
Practical Example
Suppose a court auction offers a lot of movable goods for Rs. 40,000. If the highest bidder does not pay within the period directed by the auction officer, Rule 77(1) requires the lot to be resold forthwith. If payment is made, the officer must issue a receipt and the sale becomes absolute under Rule 77(2). If the lot instead represents the judgment-debtor's share in jointly owned goods and a co-owner ties with another bidder, Rule 77(3) favours the co-owner's bid.
Related CPC Provisions
Order XXI sets out procedures for execution of decrees. For related provisions, see Rule 76 (negotiable instruments and shares), Rule 78 (irregularity in sale) and Rule 79 (delivery of movable property, debts and shares). Rules 84 onward primarily address procedures concerning sales of immovable property and should not be confused with Rule 77.
Official Legal Sources
Consult the Code of Civil Procedure, 1908 on India Code for the central legislation and any applicable amendments. State-specific amendments, High Court rules and judicial directions may affect procedure in a particular court.
Legal note: This article explains the general central provision for educational purposes. For a particular execution proceeding, check the current statutory text, applicable local amendments and court orders.