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Code of Civil Procedure, 1908 - Execution of decrees

Order XXI Rule 89 CPC - Application to Set Aside Sale on Deposit

Order 21 Rule 89 of the Code of Civil Procedure, 1908 (CPC) allows an eligible person to seek cancellation of a court auction sale of immovable property in execution of a decree by depositing specified amounts in court. The rule protects an interest in the property while providing payment to the auction purchaser and decree-holder.

Key requirement: Deposit 5% of the purchase money for the auction purchaser, plus the amount specified in the sale proclamation for the decree-holder after deducting qualifying receipts. Under Order XXI Rule 92(2), the required Rule 89 deposit ordinarily must be made within 60 days from the sale, subject to the statutory provisions concerning clerical or arithmetical deficiencies.

Order XXI Rule 89 - Statutory provision

Rule 89(1) - Application to set aside sale on deposit

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 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 received by the decree-holder since the date of the proclamation.

Rule 89(2) - Relationship with Rule 90

Where a person applies under Rule 90 to set aside the sale of his immovable property, he is not entitled to make or prosecute an application under Rule 89 unless he withdraws the Rule 90 application.

Rule 89(3) - Outstanding liability

Nothing in Rule 89 relieves the judgment-debtor from liability for costs and interest not covered by the sale proclamation.

For the authoritative statutory wording and any amendments, consult the Code of Civil Procedure, 1908 on India Code (official PDF). The explanation above restates the central requirements in accessible language.

Who can apply under Rule 89?

A person claiming an interest in the immovable property at the time of sale or at the time of the application may apply. A person acting for or in the interest of such a claimant may also apply. This can include a judgment-debtor or another person with a qualifying interest; mere curiosity about the auction does not establish standing.

How much must be deposited?

  1. Purchaser's payment: 5% of the auction purchase price, payable to the auction purchaser.
  2. Decree-holder's payment: The recovery amount stated in the sale proclamation, minus sums received by the decree-holder after the proclamation date.
  3. Additional liabilities: Costs or interest not covered by the proclamation may remain payable by the judgment-debtor under Rule 89(3).

Illustration: If the property was sold for Rs. 20,00,000 and the proclaimed recovery amount is Rs. 12,00,000, with no subsequent qualifying payment, the Rule 89 deposit would be Rs. 1,00,000 for the purchaser and Rs. 12,00,000 for the decree-holder, totalling Rs. 13,00,000. Actual amounts depend on the court record and applicable law.

Time limit for application and deposit

Article 127 of the Limitation Act, 1963 generally prescribes 60 days from the date of sale for an application to set aside an execution sale. Order XXI Rule 92(2) CPC requires the Rule 89 deposit within 60 days from the sale for the court to set aside the sale, subject to its express provision concerning deficiencies arising from clerical or arithmetical mistakes that are corrected within time fixed by the court.

Do not assume that filing an application without the required deposit preserves the remedy. Check any applicable High Court amendments and procedural directions promptly.

Procedure to seek setting aside of the sale

  1. Obtain the auction sale record, sale proclamation, purchase price and details of payments already received by the decree-holder.
  2. Confirm the applicant's interest in the property and calculate the required deposit.
  3. File the application before the executing court and deposit the required sums within the applicable time.
  4. Disclose any application under Rule 90; withdraw that application before pursuing relief under Rule 89 as required by Rule 89(2).
  5. Attend the hearing. Under Rule 92, the court gives notice to affected persons before ordering the sale to be set aside.

Order XXI Rule 90 - Irregularity or fraud

Rule 90 provides a distinct route to challenge a sale on grounds of material irregularity or fraud in its publication or conduct, subject to its requirements including substantial injury. It is different from the deposit-based remedy under Rule 89.

Order XXI Rule 92 - Confirmation or setting aside

Rule 92 governs when an auction sale becomes absolute and when the executing court must set it aside. It links the Rule 89 remedy to the prescribed deposit and notice requirements.

Article 127 of the Limitation Act, 1963

Article 127 addresses limitation for an application to set aside a sale in execution of a decree, including an application by a judgment-debtor. The prescribed period is 60 days from the sale.

Official legal sources

This article explains the central statutory framework. State amendments, local rules and the facts of an execution proceeding may affect the available relief. Verify the applicable text before filing.