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PAPER PRESENTATION ON
CLAIM PETITIONS
Presented by :

Smt A.Shobha Rani,

I AddL. Judl. Magistrate of I Class,
Kadapa
.
CLAIM PETITIONS

The Chapter ‘Execution’ in the entire Code made every endeavor

to protect not only the interests of the parties to suit and execution but
also 3rd parties, whose interests of the parties to suit and execution but
also 3rd parties, whose interests are involved without their knowledge.
The Legislature has in its wisdom foreseen various nature of claims that
may occasion during the long saga of any particular litigation. Providing
Order 21 Rule 58 is one such opportunity to the 3rd party to suit or
decree to ventilate his grievance before the Court executing the decree
without the necessity of filing a regular civil suit. The provision reads :
Adjudication of claims to, or objections to attachment of, property –
(1) Where any claim is preferred to, or any objection is made to the
attachment of, any property attached in execution of a decree on the
ground that such property is not liable to such attachment, the Court
shall proceed to adjudicate upon the claim or objection in accordance
with the provisions herein contained.
Provided that no such claim or objection shall be entertained-

(a) Where before the claim is preferred or objection is made, the

property attached has already been sold; or

(b) Where the Court considers that the claim or objection was
designedly or unnecessarily delayed.

(2) All questions (including questions relating to right, title or interest in

the property attached) arising between the parties to a proceeding or
their representatives under this rule and relevant to the adjudication of
the claim or objection, shall be determined by the Court dealing with
the claim or objection and not by a separate suit.
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(3) Upon the determination of the questions referred to in sub-rule (2),

the Court shall, in accordance with such determination, -

(a) allow the claim or objection and release the property from
attachment either wholly or to such extent as it thinks fit; or

(b) disallow the claim or objection; or

(c) continue the attachment subject to any mortgage, charge, or

other interest in favour of any person; or

(d) pass such order as in the circumstances of the case it deems

fit.

(4) Where any claim or objection has been adjudicated upon under this
rule, the order made thereon shall have the same force and be subject
to the same conditions as to appeal or otherwise as if it were a decree.

(5) Where a claim or an objection is preferred and the Court, under the
proviso to sub-rule, refuses to entertain it, the party against whom such
order is made may institute a suit to establish the right which he claims
to the property in dispute; but, subject to the result of such suit, if any,
an order so refusing to entertain the claim or objection shall be
conclusive.
A perusal of order XXI Rule 58 of code of Civil Procedure disclose
as that all questions including those relating to right, title or interest in
the attached property are required to be decided by the same court and
not by a separate suit, held in Gurram Sitharamireddy Vs Gundi
Yasodhamma AIR 2005, AP 95.

Stay of sale – Order 21 Rule 59 : Where before the claim was

preferred or the objection was made, the property attached had already
been advertised for sale, the Court may –
12. If the property is movable, make an order postponing the sale
pending the adjudication of the claim or objection, or
13. If the property is immovable, make an order that, pending the
adjudication of the claim or objection, the property shall not be sold, or
that pending such adjudication, the property may be sold but the sale
shall not be confirmed,
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And any such order may be made subject to such terms and conditions
as to security or otherwise as the Court thinks fit.

1. Adjudication of claim to property attached before judgment

– Or.38 R.8
Where any claim is preferred to property attached before
judgment, such claim shall be adjudicated upon in the manner provided
for the adjudication of claims to property attached in execution of a
decree for the payment of money.
2. Attachment before judgment shall not affect rights of
strangers Or.38 R.10
Attachment before judgment shall not affect the rights, existing
prior to the attachment, of persons not parties to the suit, nor bar any
person holding a decree against the defendant from applying for the
sale of the property under attachment in execution of such decree.
3. Procedure for Claim to attached property – Civil Rules of
Practice
Rule 246 – Claim to attached property: An application by a
claimant or objector, under Rule 58 of Order 21 of the Code shall be
made by a verified execution application entitled in execution petition
under which the property in question has been attached and shall set
forth the particulars of the claim in the manner prescribed for the plaint
in a suit as Form No.66.
4. Claim can be preferred even after sale but before
confirmation of sale
It was held that no claim can be entertained after the attached
property is brought to sale (Damodar Naidu vs. K.Kodanada Naidu,
2007(1) ALD 106). But it is not good law in view of the earlier
judgments of A.P High Court which was approved by the Apex Court.
The leading authority from the High Court is in Magunta Mining Co.
case, (Magunta Mining Co. vs. M.Kodandarami reddy, AIR 1983 AP 335)
where it was held that whenever a claim is preferred under Order 21
Rule 58 against attachment of immovable properties, the fact that the
properties are sold or that the sale was confirmed, will not deprive the
Court of its jurisdiction to adjudicate upon the claim. It is said that the
inquiry into the claim can be proceeded with by the trial Court or the
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appellate Court and in the event of the claim being allowed, the sale
and the confirmation of sale shall to that extent be treated as a nullity
and of no effect, as the J.Dr had no title which could pay to the Court
auction purchaser.
5. Burden of proof on the claimant
The claim petition is to be tried like a suit and the burden of proof
lies on the parties to lead evidence. I f the claim petitioner fails to lead
evidence in support of his claim, the Court cannot be found fault with
especially after the original and appellate Court have also confirmed the
dismissal. (Rahatunnisa vs. Md. Saber Ali Khan, 2008(5) ALD 615 =
2009(1) ALT 284).
6. Cause of action to prefer claim
Cause of action for preferring the claim under Order 21 Rule 58
arises for a claimant to submit an application only if an item of property
is attached in course of execution and not otherwise. Rule 58 can be
invoked not only in cases of attachment of immovable property but also
for movable properties and Rule 58 of Order 21 does not make any such
difference in the nature of property that was attached (Gopana Subba
Rayudu vs. Pasupuleti Venkata Ramana, 2009(6) ALD 544).
7. Whether property sold prior to attachment can be sold in
execution of decree
Order 38 Rule 10 clearly shows that if a person acquires right
under a valid document of a transaction prior to any attachment
effected under the provisions of Order 38 Rule 5 CPC, rights of such
person are not affected if he is not a party to the suit. If such person
has already obtained a decree subsequent to attachment of the
property, it does not bar the execution of any decree obtained by him.
The High Court of A.P (Adinarayana vs. S.Gafoor Sab, 2004(2) ALD 736
= AIR 2004 AP 377) held that the agreement of sale prior to
attachment before judgment would prevail over attachment and
therefore the property cannot be brought to sale.
8. Interest of a vendee under contract of sale is protected by
this provision.
The vendee under a contract of sale cannot be said to have no
locus standi to prefer a claim under Rule 58. The question whether the
agreement of sale was a good one entitling the petitioner for specific
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performance on the basis of that document is essentially a question to

be decided subsequently in the suit. Under such circumstances there
was a cloud on the property and a person like the petitioner who had
the obligation qua the property in the shape of an agreement of sale
could not be held to be an utter outsider having no locus standi to take
the objections. What the attaching creditor can attach is only the right,
title, and interest of his debtor at the date of the attachment and on
principle, his attachment cannot confer upon him any higher right than
the J.Dr had at the date of the attachment. If a person, having a
contract of sale in his favour, has such pre-existing right, the
attachment could not be binding upon him. If the promise gets a
conveyance, after the attachment, in pursuance of his contract, he
takes a good title inspite of the attachment. These observations of the
Supreme Court made in Kancheral Lakshminarayna (Kancheral
Lakshminaryana vs. Mattaparthi Syamala, 2008(5) ALD 55(SC) = AIR
2008 SC 2069) would highlight the importance of the Agreement of Sale
which is prior in time of the attachment as also the unconfirmed sale.
9. Claim under Rule 23(7) of Rent Control Rules, 1961.
There is significant difference in the enquiry in a claim petition
filed under Order 21 Rule 58 CPC and an enquiry under Rule 101 of
Order 21 pursuant to the proceedings under Rules 97 and 99 of the
Code on one hand and the enquiry in the claim petition filed under Rule
23(7) of the Rent Control Rules (under the A.P Building (Lease, Rent,
Eviction) Control Act) on the other. If the execution before the Rent
Controller is resisted and obstructed by any party other than the person
against whom the order of eviction was passed, the Rent Controller,
after holding a summary enquiry into the facts of the case and if he is
satisfied that the resistance or obstruction was without any just cause,
issues a warrant to evict the obstructer by force and deliver possession
of the premises to the person in whose favour the order of eviction was
passed. On the other hand, if the Rent Controller is satisfied that the
resistance of obstruction was occasioned by a person other than the
person against whom the order of eviction was passed claiming in good
faith to be in possession of the premises or building on his own account
or on account of some person other than the person against whom the
order of eviction was passed, he shall made an order disallowing the
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execution against that person. Thus the Rent Controller is holding a

summary enquiry only. In such enquiry, he will not decide the question
of the right, title, or interest of the person causing obstruction to
execution.
But the enquiry under Rule 58 of Order 21 or Rule 101 is
almost similar to a regular suit and the executing Court will decide the
right, title and interest of the person who makes claim or causes
obstruction. Therefore, it has to be kept in mind that in the execution
proceedings taken up pursuant to the order passed by the Rent
Controller, if an objection is raised by a third party, who sets up the
right or title in himself, the scope of enquiry before the Rent Controller
is only limited to the extent of deciding the sole question whether the
execution has to be allowed or is allowed but in no case, the Controller
will embark upon a detailed enquiry (Ramesh Kumar Jain vs. Ghansyam
Das Rathi, 2011(5) ALD 354 = 2011(4) ALT 143).

10.Wakf Property – locus standi to raise claim :

If Wakf Property is being proceeded against in execution of a
decree, it is for the Wakf Board to move the Tribunal for appropriate
relief including the petition under Order 21 Rule 58, if necessary. Any
person not connected to the Wakf Board cannot have locus standi to file
application, even if he is aggrieved with attachment of the property
belonging to Wakf. He cannot file any counter-affidavit in the execution
application because a counter can be filed only by persons who are
parties to the proceedings. (S.M.Khasim Vali vs. Shivaji, 2008(2) ALD
742).
11.Purchaser of joint share prior to final decree cannot object
for execution for recovery of mesne profits against the property
of his vendor.
In the case of a decree passed for payment mesne profits, every
item of property that fell to the share of the individual will be burdened
with the obligation to discharge the mesne profits. The law allows a co-
parcener to transfer his undivided share or to allot the transferred item
towards the share of the transferor. Till such time, the transferee does
not acquire any absolute right notwithstanding the legality of the
transfer. There, notwithstanding the legality or validity of the respective
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deeds of transfer in favour of the transferee and his vendor, they do not
have the right to prevent the execution of the decree for recovery of
mesne profits, particularly when the transfer in their favour took place,
before final decree was passed and recovery of mesne profits was part
of the same decree. (Kavuri Venkataramanamma vs. Kavuru
Narayanarao, 2011(1) ALD 659 = 2011(2) ALT 217).
12. The legal representative of deceased J.Dr can file separate
suit for declaration of their rights in attached property.
The legal representatives of deceased J.Dr are brought on the
record of the EP claiming that the property against which the execution
is being proceeded with, the legal representatives have filed a separate
suit for declaration of their title to the attached property. That suit was
dismissed on the ground that in the pending EP they can get their right
declared and that by virtue of Section 47 and of Order 21 Rule 58, all
questions relating to the execution have to be decided by the executing
Court only and a separate suit is not maintainable.
13. A person who has raised his claim once under Order 21
Rule 58 CPC unsuccessfully, cannot re-agitate the same claim
under Order 21 Rule 97 CPC.
A third party to a suit for partition and who did not have any
interest of his own in the property cannot resist the execution of that
decree on the ground that the final decree is not in consonance with the
preliminary decree. In earlier EP, he filed a claim application under Rule
58 of Order 21, claiming a right in the possession of the house and that
was dismissed. Again at the time of delivery of possession to the D.Hr,
he raised the same claim and raised objection to the delivery by making
an application under Rule 97 of Order 21 CPC. It is held that the 2nd
petition is barred by principles of res judicata. (M.Padma vs. M.Seshagiri
Rao, 2003(5) ALD 3 = 2003(4) ALT 683).

14. Suit to set aside the order in the application under Order
21 Rule 58 is not maintainable – appeal only lies :
The Full Bench judgment of A.P High Court (Pallmreddy Masthan
Reddy vs. Nellore Finance Corp., AIR 1993 AP 29) is the authority on
this question and it was referred to in a later judgment (Kothapalli
Koteswara Rao vs. Murukonda Subbarao, 2002(6) ALD 609).
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9. The suits filed under repealed Rule 63 and the claim petitions
disposed of before the Amendment Act should continue to be
governed by the old provisions unaffected by the amendment. On
the disposal of the claim petition which would have been disposed of
in accordance with the old procedure, the right to file a suit
undoubtedly accrued to the party and so he can avail that remedy
unmindful of the amendment.

10. Claim petitions pending on the date of commencement of the

Amendment Act will have to be disposed of by the new procedure
laid down by amended Rules 58 and 59 irrespective of prior
attachment. That means, instead of a summary investigation into
possession, there should be a full-fledged enquiry into the right, title
and interest. The order passed therein shall be treated as a decree
and appeal lies against it.

11. Same rule applies to claim petitions filed after the Amendment Act.

15. Appeal and suit against the order in application under Rule
58(5) of Order 21.
The purpose of the proviso is to see that execution should not
unnecessarily be encumbered or unduly delayed by allowing frivolous
objections from unconcerned quarters and so when a claim filed, the
Court has to look into the circumstances mentioned in the proviso and if
the design of the objection is to delay execution, it shall not investigate
into the claim or objection. If the Court conducts an enquiry and
dismisses the petition filed under Order 21 Rule 58 CPC, such order
would be appealable, and if the petition is summarily rejected under
proviso to sub-rule(1) of Rule 58, separate suit under sub-rule(5) is the
remedy.
16. For rejecting the application on ground of delay, Court
shall give opportunity to applicant.
The Court has undoubted power under Rule 58(1)(b) of Order 21
if the Court considers that the claim or objection was designedly or
unnecessarily delayed. But this power cannot be exercised arbitrarily.
Mere delay is not sufficient, but a designed delay shall be apparent on
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the fact of the record to exercise such power. It is advised that

whenever the Court proposes to refuse to entertain the application on
the ground of such designed or unnecessary delay, the Court is bound
to give an opportunity to the claimant to satisfy that the delay was
unavoidable or was on account of ignorance of the proceedings pending.
If no such fair opportunity is given to the claimant, the Court will be
subjected to comment of undue haste. In common law, every person
who approaches the Court system has a right to know the reasons why
his cause is not being entertained by the Court and the reasons as to
why he is denied opportunity of hearing.

17.Stay of sale when the application under Rule 58 is filed.

The provision is Rule 59 of Order 21. It provides two kinds of
orders: (a) if the property is movable, postponing the sale pending the
adjudication of the claim and (b) in case of immovable property, the
property shall not be sold or it may be sold making the sale subject to
confirmation, till the adjudication into the claim is made. The provision
did not postulate filing of any separate petition to order stay, along with
the application of claim under Rule 58. It appears from the language of
the provision, whenever a claim application is filed, the Court on its own
order postponement of sale pending such adjudication or that to sell but
shall not confirm it. Much case law is not developed in this area. But in
practice, in the Courts, separate applications under Rule 59 of Order 21
are being filed.

18. Order under Order 21 Rule 58 is appealable under Order 41

– Revision does not lie.
There was a contention that the order passed in a petition filed
under Order 38 Rule 8 is subject to revision under Order 43. But this is
a misconception as held by the A.P High Court. It is stated that Order
43 Rule 1 deals with appeals from orders. It does not cover an order
passed in a claim petition under Order 21 Rule 58 CPC. An order
adjudicating a claim petition whether instituted under Order 38 Rule 8
CPC, an Order 21 Rule 58 CPC, as per the provisions in Order 21 Rule
58(4) CPC, is to be treated as a regular decree and it is Order 41 CPC
but not Order 43 which deals with the appeal to be filed over such an
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order. The High Court in Ushasri Agro Agencies (Chit Funds), Khammam
vs. Giridhar Auto Finance (P) Ltd., Khammam, 2003(2) ALD 370, held
that the order passed in a claim petition is appealable as per the
provisions of Order 41 CPC. A second appeal therefore, lies to High
Court. (Bollapalli Venkata Rao vs. Ch.Subbaiah, 1982 Ls (SRC) 99C.

A.Shobha Rani,
I Addl. Judicial Magistrate of First Class,
Kadapa