Attachment of Property: Civil Procedure Code

Introduction

When a court pass a decree for submit a sum of money and the defendant is fails to do the same, the court can attach the property of the defendant and recover the amount b disposal of the assets, in execution of the decree. The property which is liable to attach may be either movable or immovable. For example lands, houses, or other buildings, goods, money, bank notes cheques, bills of exchange, hundis, promissory notes, government securities, or other securities for money, debts, shares in a corporation etc. are all properties which can be attach against a decree. On the same time some of the property cannot be attach, such as personal property, salary, incorporeal property etc.

Attachment of Property: Civil Procedure Code

In CPC the provisions which deal with attachment are section 60 to section 64 and provisions deals with sale of the property are section 65 to section 73. Apart from this Order 21 deals with the various properties are either attach or sale. As per the effect of attachment, it does neither create any title of the decree holder to the property nor create a lien or charge over the property. The judgment debtor continues to enjoy the attachment. It only prevents a private transfer and that no person can gain from a subsequent transfer of the attached property.

A decree may also be executed on the application of the decree holder by attachment and sale or by sale without attachment of property.

Attachment of Property:

The Code recognises right of the decree holder to attach the property of the judgment debtor in execution proceeding and lays down the procedure to effect attachment. Section 60 to 64 and Rule 41 to 57 of Order 21 deal with the subject of attachment.

The main object of attachment is to protect the rights of the decree holder as well as to give proper notice to judgment debtor not to alienate the property to anyone. Keeping in mind the object in the provisions, the words, “attachment” and “sale” are to be read disjunctively and not conjunctively[1].

Section 60 (1) declares what properties are liable to attachment and sale in execution of a decree and what properties are exempt therefrom. According to this all saleable property belonging to the judgement debtor or over which or the portion of which he has disposing power which he may exercise for his own benefit may be attached and sold in execution of a decree against him. But this section is not exhaustive.

In the proviso of section 60 (1) mentioned the properties which are exempt from attachment and sale in execution of a decree. According to this list necessary wearing, apparel, coking vessel, bedding, tools of artisans, wages, salaries, pensions, compulsory deposits, etc. are exempted property.

There was a conflict of judicial opinion as to whether a judgment debtor can waive the benefit conferred on him by the proviso. But later on due to the Amendment Act 1976 this conflict resolved. As per the amendment any agreement to waive the benefit of any exemption under section 60 is void. This amendment inserted as sub section (1A).

Modes of Attachment:

 Rule 43 to 54 of Order 21 lay down the procedure for attachment of different types of movable and immovable properties. These provisions are following:

  1. As per R 43 when property is movable, other than agriculture, in the possession of judgment debtor than it will attach by actual seizure. But if such property is perishable in nature or the expense of keeping it is likely to exceed its value, it may be sold.
  2. According to R 43-A when movable property consisting of livestock, agricultural implements or other articles which cannot be conveniently be attached than it attached by leaving the same in the custody of a respectable person as the custodian.
  3. R 44 states that when the property is in agriculture produce than it may be attach by (i) affixing a copy of warrant (a) in case of growing crop, on land on which such crop has grown and (b) in case of ready crop the place at which it is lying. (ii) by affixing a copy on the house in which the judgment debtor ordinarily resides, carries on business or personally works for gain or last resided, carried on business or personally worked for gain.
  4. R 45 also with agriculture produce. According to this the application is for attachment of growing crop, it shall specify the time at which is likely to be harvested.
  5. R 46 (1)(a) mentioned that when debt not secured by a negotiable instrument that the attachment made by an order prohibiting the creditor from recovering the debt and the debtor from paying the debt.
  6. R 46 (1)(b) mentioned when share in the capital of a corporation than attachment made by an order prohibiting the person in whose name the share stands from transferring it or receiving dividend thereon.
  7. R 46 (1)(c), when movable property is not in possession of the judgment debtor the attachment will be made by an order prohibiting the person in possession thereof from giving it to the judgment debtor.
  8. R 47, share or interest in movable property belonging to the judgment debtor and another as co-owner the attachment will be made by a notice to the judgement debtor prohibiting him from transferring or charging it.
  9. R 48 and R 48 A deals with attachment of salary or allowance of a public servant or a private employee. To this an order that the amount shall, subject to the provisions of Sec. 60, be withheld from such salary or allowance either in one payment or by monthly instalments.
  10. R 49 states that when partnership property is attached it is through making as order: (a) charging the interest of the partner in the partnership property, (b) appointing a receiver of the share of the partners in profits, (c) directing accounts and inquiries and (d) ordering sale of such interest.
  11. R 51, when negotiable instrument neither deposited in a court nor in the custody of a public officer, than the attachment is made through actual seizure and bringing it into court.
  12. R 52, when property in custody of court or public officer than the attachment by notice to such court or officer, requesting that such property and any interest or dividend thereon may be held subject to the order of the court.
  13. R 53 deals with attachment of decrees. According to this when (i) decree for payment of money or sale in enforcement of a mortgage or charge (a) passed by the court executing the decree attachment will be made by an order of such court. (b) passed by another court attachment will be made by issuing a notice to such court requesting it to stay execution thereof. (ii) decree other than mentioned above than the attachment will be made by issuing a notice to the decree holder prohibits him from transferring or charging it in any way or to executing court from executing it until such notice is cancelled.
  14. R 54, immovable property will be attached by an order prohibiting the judgment debtor from transferring or charging it in any manner and all persons from taking any benefit from such transfer or charge.

Section 62 states that no dwelling house may be entered after sunset and before sunrise. No outer door of it may be broken open, unless it is in occupancy of the judgment debtor and he refuses or prevent access thereto. But when a dwelling house is in actual occupation of a pardanashin woman, reasonable time and facility must be given to her to withdraw.

Section 63 deals with procedure to be followed in case the property is attached in execution of decrees by several courts.

Rules regarding Garnishee: – Rule 46-A to 46-I of Order 21, as inserted by the Code of Civil Procedure Amendment Act 1976, lays down procedure in garnishee cases. Garnishee proceeding is a proceeding by which the decree holder seeks to reach money or property of the judgment debtor in the hands of a third party. By this process, an executing court may order the third party to the decree holder the debt from him to the judgment debtor.

“Garnishee” means a judgment debtor’s debtor. He is a person who is liable to pay a debt to a judgment debtor or to deliver any movable property to him. Garnisher is a decree holder who initiates garnishee proceedings to reach judgment debtor’s money or property held or possessed by garnishee. Garnishment is a proceeding by which the decree holder seeks to get the property of judgment debtor.

The court in case of a debt, other than a debt secured by a mortgage or charge, which has been attached under section 46 upon the application of the attaching creditor, issue a notice to the garnishee liable to pay such debt, calling upon him either pay into court the debt due from judgment debtor or so much thereof as may be sufficient to satisfy the decree and costs of execution, or to appear and show cause why he should not do so. 

The order contemplated by R 46-A is discretionary and the court may refuse to pass such order if it is inequitable. The discretion must be exercised judicially.

These rules are as following: –

  1. Notice to garnishee
  2. Order against garnishee
  • Trial of disputed question
  1. Procedure where debt belongs to third person
  2. Order as regards third person
  3. Payment by garnishee to be valid discharge
  • Costs
  • Appeals
  1. Application of negotiable instruments

Rules regarding determination of attachment: – According to Rule 55 to 58 of Order 21 an attachment under the Code will be determined in the following circumstance: –

  1. Where the decretal amount is paid or the decree is otherwise satisfied.
  2. Where the decree is reversed or is set aside.
  3. Where the court upholds objection against the attachment and makes an order releasing the property.
  4. Where after the attachment the application for execution is dismissed.
  5. Where the attaching creditor withdraws attachment.
  6. Where the decree holder fails to do what he is bound to do under the decree.
  7. Where the attachment is ordered before judgment and the defendant furnishes the necessary security.
  8. Where there is agreement or compromise between the parties.
  9. Where the attaching creditor abandons the attachment.

Lastly section 64 deals with private alienation of property after attachment.  Section 64 (1) enacts that a private alienation of property after attachment is void as against claims enforceable under attachment. The alienation, however, is not absolutely void against the entire world, but is void against the claims enforceable under the attachment.

Section 64(2) inserted by Amendment Act 2002 which clarifies that the section will not apply to a transfer of property in pursuance of a contract entered into and registered before the attachment.

Private transfer means a voluntary transfer such as sale, mortgage, lease, gift, etc. and not a transfer by operation of law such sale under a decree passed by a competent court.


Case Reference:-

[1] Amula Chandra v. Pashupati Nath, AIR 1951 Cal 48 (FB)

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