Order XXI Rule 85 CPC: Time for Full Payment of Purchase Money

Order 21 Rule 85 of the Code of Civil Procedure, 1908 governs when a successful bidder at a court auction of immovable property must pay the balance of the purchase price. It also recognizes a set-off available to an eligible decree-holder under Rule 72.

Provision under Order XXI Rule 85

Meaning and scope of Rule 85

The rule applies to sales of immovable property in execution of a civil decree. After the auction, the purchaser must ensure that the entire amount payable is deposited with the executing court within the statutory period. The rule is concerned with the payment deadline, not with the final confirmation of the sale.

What is the deadline for paying the balance?

The purchaser must deposit the full purchase money before the court closes on the fifteenth day from the sale. The auction date is ordinarily excluded when computing the period. The application of court holidays and time-computation rules depends on the applicable procedural law and facts; bidders should not assume that an extension is available.

Under Order XXI Rule 84, the successful purchaser ordinarily pays an immediate deposit of 25% of the purchase price. Rule 85 then requires payment of the outstanding balance within the prescribed period. The deadline is generally treated as mandatory; courts do not ordinarily have discretion to enlarge it.

Set-off under Order XXI Rule 72

Where the decree-holder is permitted to purchase the property and is entitled to set off the purchase money against the amount due under the decree, the amount payable into court is calculated after allowing the lawful set-off. This is not an automatic concession to every auction purchaser. The entitlement must arise under Rule 72 and the applicable court order.

What happens if the purchaser fails to pay?

Order XXI Rule 86 governs default in payment within the period mentioned in Rule 85. The court may forfeit the deposit to the Government after defraying the expenses of the sale and the property must be resold; the defaulting purchaser forfeits claims to the property and to any part of the price for which it may subsequently be sold. The statutory consequences should be read with Rule 86 and the applicable judicial interpretation.

Other connected provisions

• Rule 84: Immediate deposit of 25% of purchase money and resale on default, subject to the decree-holder exception.
• Rule 86: Procedure when the full purchase money is not paid within the prescribed time.
• Rule 87: Notification of resale after a default.
• Rule 92: When a court auction sale becomes absolute or is set aside.
• Rule 94: Issue of a sale certificate after confirmation.

Illustration

Suppose immovable property is sold at a court auction for Rs. 10,00,000. Ordinarily, the successful bidder deposits Rs. 2,50,000 immediately under Rule 84 and pays the remaining Rs. 7,50,000 within the time prescribed by Rule 85. A qualifying decree-holder may have a different net payment obligation because of the set-off under Rule 72.

Frequently asked questions

Can the purchaser pay after the fifteenth day?

As a general rule, the Rule 85 deadline is mandatory. A purchaser should not rely on a discretionary extension; any question involving a court closure or an exceptional procedural circumstance requires examination of the applicable law.

Does the 25% deposit satisfy Rule 85?

No. Rule 84 addresses the initial deposit; Rule 85 requires the entire purchase money payable, subject to an authorized set-off.

Does paying the price automatically confirm the sale?

No. Confirmation of the auction sale is governed by other provisions, including Rule 92.

Official legal source

Consult the Code of Civil Procedure, 1908 on India Code for the statutory framework and any applicable amendments. State amendments and High Court rules should also be checked for the relevant jurisdiction.

This article provides general legal information and is not a substitute for advice on an individual execution proceeding.