Introduction

In case of a decree from a Court, the Court may require any person
(known as the defendant) to pay any sum to the decree holder (or the
plaintiff). In case the defendant fails to do so the Court can, in
execution of its decree, attach the movable and immovable properties
of the defendant and recover the amount due by disposal of these
assets. However, certain assets are not liable to attachment under a
Court decree. In an issue relating to Debt Recovery Tribunals, the
Recovery Officer of the DRT can require any debtor of the defendant to
pay any sum directly to him. This excludes any amount exempt from
attachment in execution of a Court decree u/s. 60 of the Code of Civil
Procedure, 1908. This Article examines some of the provisions relating
to Attachment of properties in execution of a Court decree and their
exemptions.

Execution of a Decree

The Civil Procedure Code, 1908 (the Code) deals with the provisions
relating to a court decree and its execution. s.2(2) of the Code defines
a decree as the formal adjudication which conclusively determines the
rights of the parties with regard to the controversial matters covered
by the suit. The decree could be interim or final.
The judgment debtor is a person against whom a decree has been
passed or an order capable of execution has been made.
The decree holder means a person in whose favour a decree has
been passed or an order capable of execution has been made.

Meaning
A decree may also be executed on the application of the decree-holder
by attachment and sale or by sale without attachment of property. The
Code recognises the right of the decree-holder to attach the property
of the judgment-debtor in execution proceedings and lays down the
procedure to effect attachment. Sections 60 to 64 deal with the subject
of attachment of property.

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Nature & Scope

The Code enumerates properties which are liable to be attached and

sold in execution of a decree.1 Likewise, it also specifies properties
which are not liable to be attached or sold. It also prescribes the procedure
where the same property is attached in execution of decrees by more than
one court.2 The Code also declares that a private alienation of property after
attachment is void.3

An executing court is competent to attach the property if it is situated within

the local limits of the jurisdiction of the court. The place of business of the
judgment-debtor is not material.

The provisions of the Code, however, do not affect any special or local law.
Attachment and sale under any other statute, therefore, can be made and
the judgment-debtor cannot claim benefit under the Code.4
Object

The primary object of attachment of property is to give notice to the

judgment-debtor not to alienate the property to anyone as also to the
general public not to purchase or in any other manner deal with the property
of the judgment-debtor attached in execution proceedings. At the same
time, it protects a judgment-debtor by granting exemption to certain
properties from attachment and sale.

1Sec. 60(1).

2Sec. 63.

3Sec. 64.

4State of Punjab v. Dina Nath, (1984) 1 SCC 137.

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Keeping in mind the intention underlying the provisions, the words
"attachment" and "sale" are to be read disjunctively and not conjunctively.
Hence, attachment of property is not a condition precedent and sale of
property without attachment is merely an irregularity and does not vitiate
the sale.

Attachment

Section 60. Property liable to attachment and sale in execution of decree.-

The following property is liable to attachment and sale in execution of a decree,

namely, lands, houses or other buildings, goods, in money, bank-notes, cheques,
bills of exchange, hundis, promissory notes, Government securities, bonds or other
securities for money, debts, shares in a corporation and, save as hereinafter
mentioned, all other saleable property, movable or immovable, belonging to the
judgment-debtor, or over which, or the profits of which, he has a disposing power
which he may exercise for his own benefit, whether the same be held in the name of
the judgment-debtor or by another person in trust for him or on his behalf

The property belonging to the judgment debtor, or property over

which, or the profits of which, he has a disposing power which he may
exercise for his own benefit, is liable to attachment and sale in
execution of a decree.

The property liable to attachment may be lands, houses or other

buildings, goods, money, bank notes cheques, bills of exchange,
hundis, promissory notes, Government securities, bonds or other
securities for money, debts, shares in a corporation and, other than the
assets expressly excluded, all other saleable property, movable or
immovable. The property may be held in the name of the judgment
debtor or by a trustee for his benefit or on his behalf.

Exemption of Properties from Sale and Attachment

The execution of a decree is generally through attachment and sale of

property. The legislatures felt a need for exempting some properties

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from attachment and sale. These have been enumerated in Sec. 60
and Sec. 61.

Section 60(1) authorises, subject to certain exceptions, the attachment

and sale of the property of the judgment-debtor. In the main paragraph
of this subsection, after enumerating property liable to attachment, a
general principle is enunciated, where under, broadly speaking,
saleable property which belongs to the judgment debtor or over which
he has a disposing power exercisable for his own benefit is attachable.
The proviso to section 60(1) enumerates certain properties as exempt
from attachment.

The primary object of attachment of property is to give notice to the

judgment debtor not to alienate the property to anyone as also to the
general public not to purchase or in any other manner deal with the
property of the judgment debtor attached in execution proceedings.

Principles behind the exceptions-

At first sight it may appear that the exceptions are enumerated

randomly but there are certain principles behind the enumeration of
these exceptions. The exemptions are attributable to one or more of
the following broad principles-

I. The principle of necessity- The item mentioned in clause (a) of

the proviso is based on this principle.

II. The principle of protecting the means of livelihood- This justifies

the exemptions in clause (b), clause (c) and clause (d).

III. The principle of leaving money required for subsistence- This

explains clauses (g),(h),(I),(1a),(j)and(l)

IV. The principle of thrift- That the state should encourage thrift is
the principle behind clause (k).

V. The principle of non- transferability of the property- The property

which is not transferable by act of parties should also not be
attachable under legal process. This principle justifies the
exemptions in clause (e), (f), (m) and (n).

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 VI.The principle of harmony with other laws- This principle accounts
for the exemptions in clauses (c) and (p)

Judicial Decisions on Sec. 60: Expanding the Scope of the Properties

Enumerated

Many disputes arose as to the extent and meaning of the items

enumerate for exemption under section 60. Judiciary through its
decisions has tried to allay these disputes. Some of these are being
discussed in this part of the project, clause wise. One common point
which can be extracted from these judicial decisions is that these
clauses should be liberally interpreted.

1.Clause (a)

Cooking vessels

Court has held that cooking vessels are not only the vessels in which
the food is actually cooked, but also other vessels necessary for
cooking operations, such as thali and gagra.

Ornaments

Ornaments of a Hindu wife, forming part of her stridhan, cannot be

attached in execution of a decree against the husband, even though
the Hindu law concedes him a personal right of usage. The
mangalsutra, a neck ornament which is worn by a Hindu wife during
the life time of her husband without ever removing it, is also exempted
from attachment.

2.Clause (b)

Tools of artisans

In Ramachandran Ayyar v. Sesha Ayyangar, it was observed that

the word artisan had a well-recognised meaning and is roughly
synonymous with craftsman and mechanic. Even tools of complicate
character such as those of a goldsmith would fall within the proviso. A
lathe, a drilling machine and a weeding machine operated by

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electricity will also fall within it. It is not necessary that they should be
in use at the time of attachment. It is sufficient that they can be used
when required. The following are not artisans: a surgeon or a doctor, a
musician, a firm.

A person who doesn't himself use the lathe machine is not an artisan, if
the machine is used by his employees. In Bindeshari v. Banshilal, an
extended meaning was given to the word artisan as including a person
who works in the production of commodities and it was held that a
soap boiler who practiced making soaps was and artisan and the
paraphernalia of his soap factory were the tools of an artisan.

Rajasthan High Court in Kanhayalal v. Muthu Swami Achari held

that a halwai wala was not an artisan but a shopkeeper who purchased
commodities and processed them and that accordingly utensils used
by him were not exempt from attachment under this proviso. I disagree
with this opinion of the court because most of the artisans buy raw
materials and then process them, just like a halwaiwala, if these other
people are exempted under these clause then logically halwai wala
should also be exempted and should be included in the definition of
artisan.

Implements of husbandry

The principle underlying clause (b) is that artisans who depend for their
livelihood on the tools which they possess or the implements of
husbandry which they, as agriculturist, require to earn their livelihood
then such implements should be exempted and that the word
livelihood' in the clause connotes the idea of means of living and
subsistence.

Charaks, kadhais, and planks of timbers used by an agriculturist for

extracting sugar juice from sugarcane, which he has grown on his field,
and is used by him for turning cane into jiggery, are implements of
husbandry within the meaning of clause (b). It has been held that a
motor tractor cannot be held to be an implement of husbandry
because it is not indispensable to agriculture. So the general rule is

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that any equipment which is indispensable for earning basic livelihood
is exempted under this clause.

3.Clause (c)

Under this clause, the main residential building and all the other
building attached to it, belonging to agriculturist, labourer or domestic
servants, are exempted from sale and attachment in execution of a
decree. When the whole building is used for residential purpose, the
fact that there is a shop on the ground floor will not take it outside
exemption. The exemptions enumerated in sec. 60 are applicable to
proceedings by way of attachment and sale by the official receiver in
exercise of his powers under the provincial insolvency Act, 1920. It has
been held that special provisions in favour of agriculturists don't offend
Art. 14 and 15 of the constitution. The Amendment Ac t of 1976 has
extended the benefit to labourers and domestic servants. Both terms
labourers and domestic servants are used in their ordinary
meaning and not in any technical sense. Immunity from attachment
with regards to residential house is not available to debtor unless he
establishes connection between the agricultural operations carried on
by him and the house sought to be attached.

Judiciary has held that the term agriculturist' includes persons

engaged in cultivating the soil for remuneration although they may
have no interest in the soil either as proprietor or tenant. For the
application of this clause an agriculturist includes a small holder who
tills the soil and cultivates it and does not include a large landed
proprietor, even though his sole income is from agriculture. The term
includes a person who personally engages himself in tilling the soil and
whose livelihood depends upon the proceeds derived from the tillage
of land. The meaning of the word agriculturist came up for
consideration before Supreme Court in Appasaheb v. Bhalchandra
and it was held that before a person could claim to be an agriculturist
he must at least show that he was really dependant for his living on
tilling the soil and was unable to maintain himself other -wise. Thus
the true test is whether a man personally engages in tilling and
whether this occupation is essential to his maintenance. It was

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accordingly held that a person who had a substantial income from
lands other than those cultivated by him as home farms and also cash
allowances was not an agriculturist and that a building constructed by
him was not exempted from attachment. In the case of a minor, if it is
shown that his main income is derived from agriculture, it is immaterial
that his land is cultivated by labourers engaged for that purpose.

If a house occupied by an agriculturist is specifically mortgaged, then it

is not protected from sale in execution of a decree upon the mortgage.
Clause (c) doesn't prohibit the sale of property specifically mortgaged,
although it may be occupied by an agriculturist as such, unless he is
prohibited by law from mortgaging or selling it.

4.Clause (e)

Right to sue for damages

Mesne profit is in the nature of damages, and the right to sue for
mesne profits is a right to sue for damages. Such a right cannot
therefore be attached and sold in execution of a decree against the
person entitled to the right. Thus if, A is entitled to claim mesne-profit
from B for wrongful dispossession of his lands, A's right to claim
mesne-profits from B cannot be attached and sold in execution of a
decree against A.

A vritti is a right to receive certain emoluments as a reward for

personal services, and is therefore exempt from attachment and sale.
But a priests share in net balance of the offering to a deity may be
attached or sold.

5.Clause (g)

Gratuities allowed by government or local authority or any

other employer

The gratuity referred to in this section is a bonus allowed by

government to its servants in consideration of past service. It may be
allowed to one who is not a pensioner or it may be allowed to a

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pensioner in addition to his pension. In either case it is exempt from
attachment. The amount earned by a deceased employee which has
become payable to his legal representatives, is not exempt from
attachment. Gratuity payable to an employee under the gratuity Act is
also exempt from attachment and sale.

Private pensions, as distinguished from government pensions, are not

exempt from attachment and they may be attached either as debts' or
as property belonging to the judgment debtor' within the meaning of
this section. But they neither constitute debts' nor property belonging
to the judgment debtor' until they have become due and payable.
Hence, they cannot be attached before they have become due and
payable. Pensions granted by Railway Companies were held to be
private pensions.

6.Clause (h)

Wages of labourers

A labourer is a person who earns his daily bread by personal manual

work, or in occupations which require little or no art, skill or previous
education. A weaver in a textile mill is a labourer within this proviso but
not a clerk. A watchman working under the Calcutta Dock labour board
is not a labourer since before he could be engaged he had to undergo
training prescribed by rule 21 of the Calcutta dock workers Scheme.
There is a conflict of judicial opinion on the question whether wages
includes bonuses declared and payable to labourers. One view is that
bonus is held by the SC a payment contingent on the earning of the
profits and is ex gratia and it is therefore not wages and is liable to
attachment. On consideration of the definition of gratuity in different
enactments and the broad analogy of the term with bonus, gratuity,
payable on retirement to a labourer has been held to be wages; so
also bonuses.

7.Clause (I)

Salary

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This clause doesn't apply to arrears of salary. Dearness allowance has
been held to be part of salary and should be taken into account in
calculating the attachable amount. It has been held that when salary
has become exempt from attachment under the proviso to this clause,
it would not be legal to appoint a receiver therefore as that would
defeat the underlying principle.

8.Clause (m)

Expectancy of succession

The interest which a Hindu reversioner has in the immovable property

of a deceased Hindu on the death of the deceaseds widow, is an
expectancy of succession by survivorship; in other words, it is an
interest expectant on the widow's death to which the reversioner can
only succeed if he survives the widow. The interest in the pre-empted
property of a successful pre-emptor who has not yet paid the pre-
emptive price fixed by his decree is a merely contingent interest which
cannot be attached. But the interest which a coparcener has in money
awarded to him on partition is vested interest although payment is
deferred. It has been held by the privy council that the words or other
merely contingent or possible right or interest in this subsection
cannot be constructed as applying only to such possible rights or
interest as are ejusdem generis with an expectancy of succession by
survivorship, that is to say, with a spes successionis. A contingent
interest though transferable is not attachable; it is only vested interest
that can be attached.

9.Clause (n)

Right to future maintenance-

If A is entitled to a monthly maintenance allowance under an

agreement, the allowance cannot be attached until after it has become
due. It cannot be attached prospectively, that is, before it becomes
due. So long as maintenance granted under sec. 488 of the CrPC is not
realised it continues to be a right of future maintenance. A hereditary
grant of an allowance of paddy out of the melwaram of certain land is

10
not a right to future maintenance so as to be exempted from
attachment under this section.

On the question whether it was open to the judgment-debtor to waive

the benefit of the exemptions under the proviso to subsection 1, the
authorities were divided: some holding that they could be waived and
some taking the view that they cannot be waived. This conflict has
been allayed by enacting sub section 1A in favour of the latter view
that no such waiver is legal and valid.

Vide section 61 the State Government may, by general or special order

published in the Official Gazette, declare that such portion of
agricultural produce, or of any class of agricultural produce, as may
appear to the State Government to be necessary for the purpose of
providing until the next harvest for the due cultivation of the land and
for the support of the judgment-debtor and his family, shall, in the case
of all agriculturists or of any class of agriculturists, be exempted from
liability to attachment or sale in execution of a decree.

The words be exempted from liability to attachment or sale are wide

enough to include agricultural produce which has been hypothecated.

Changes Made By 1976 Amendment

Clause (c) to the provision to sub section 1 has been amended so as to
extend the exemption from attachment and sale to houses and other
buildings belonging to not only an agriculturist but also to a labourer or
a domestic servant.

Clause (g) to the provisio to sub sec. 1 has been amended so as to

extend the exception to stipends and gratuities allowed to pensioners
of a local authority or any other employer.

Clause (I) has been amended to enlarge the exception as to salary to

the extent of the first four hundred rupees and two third of the
remainder. THE new proviso does away with the distinction between

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judgment debtors who are government servants or railway employees
and other salaried judgment debtors.

Clause (j) has been substituted so as to extend to all persons to whom

the Navy Act, 1957 applies.

The new clause (kb) extends the exception from attachment to moneys
payable under life insurance policies.

The new clause (kc) exempts from attachment interest of tenants in a

residential building governed by Rent Acts.

Effect of Attachment

1. An attachment does not create any title of the decree-holder to

the property nor does it create a lien or charge over the property
for the sum due to the decree-holder.

2. The judgment debtor continues to enjoy the attached property.

3. All that an attachment does is to prevent a private-transfer and

that no person can benefit from a subsequent transfer of the
attached property. S. 64 of the Code provides for such private
alienation. Once a property has been attached, any private
alienation of such property by private transfer or delivery and any
payment to the judgment debtor of any debt, dividend, etc.,
contrary to such attachment shall be void as against all claims
enforceable under the attachment. S.64 applies whether the
property stands in the name of the judgment debtor or any other
person who is a name lender, i.e., benami property Pradyut
Shah5. However, if the transfer is by an operation of law or
pursuant to a Court order, then s.64 does not apply. It only covers
private transfers, such as, voluntary sales, gifts, mortgages. It
may be noted that the private transfers are not void ab initio but
only void as against all claims enforceable under the attachment.
There is a difference of opinion amongst various Courts as to
whether or not any private transfer after attachment but in
pursuance of a contract of sale executed prior to attachment is
covered by s. 64. Various decisions have held that in order that
5 AIR 1979 Bom 166

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 an attachment renders a subsequent alienation as void u/s. 64,
the attachment must follow the process laid down under the
Code, e.g., Rules 41 to 57 of Order 21.

Private Alienation of Property after Attachment: Section 64

Section 64 (1) enacts that a private alienation of property after attachment is

void as against claims enforceable under the attachment. The alienation,
however, is not absolutely void against the entire world, but is void against
the claims enforceable under the attachment.

Sub-section (2) of Section 64, as inserted by the Code of Civil Procedure

(Amendment) Act, 2002 clarifies that the section will not apply to a transfer
of property in pursuance of a contract entered into and registered before the
attachment.6

The primary object of this provision is to prevent fraud on decree-holders

and to keep intact the rights of attaching creditors and of those creditors
who have obtained decrees and are entitled to satisfaction out of the assets
of the judgment-debtor.7 It is, therefore, immaterial for the application of
Section 64 whether the decree had or had not been passed before the time
when the transfer was effected or whether the transferee acted in good faith
or not. But if the sale deed was executed prior to attachment before
judgment, it can be registered subsequently and will prevail over
attachment.

The provision interferes with the rights of the owner in alienating his
property and, hence, it should be construed strictly. Again, as the provision is
for the benefit of attaching creditor, he can waive the benefit.

A "private transfer" means a voluntary transfer such as sale, mortgage,

lease, gift, etc. and not a transfer by operation of law such as sale under a
decree passed by a competent court. Finally, a private transfer in

6Sec. 64.

7Official Receiver v. Chandre Shekhar, AIR 1977 All 77 at pp. 78-79.

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contravention of Section 64 is not wholly void against the entire world but is
void only against claims enforceable under the attachment and only the
extent necessary to meet those claims.

Auditors duty

The Auditor should enquire of the auditee whether any attachment

proceedings are pending against it. The Auditor can provide value
added services to his clients by enlightening them about which assets
are not attachable and what are the rights and obligations in respect of
an attached property. It needs to be repeated and noted that the audit
is basically under the relevant law applicable to an entity and an
auditor is not an expert on all laws relevant to business operations of
an entity. All that is required of him is exercise of due care. The
Auditor should also enquire whether the entity has obtained
attachment in cases filed by it. This will enable the Auditor to assess
the provisions for bad and doubtful debts. Though an attachment
does not create any rights in favour of the entity but the courts
normally do not grant attachment unless the plaintiff establishes a
prima facie case.

Modes of Attachment
Order 21 Rules 43-54

Rules 43-54 (0.21) lay down the provisions governing attachment of various
kinds of property.

Moveable property (other than agricultural produce): by

actual seizure; if it is subject to speedy and natural decay, it may
be sold (R. 43).
Agricultural produce: by affixing a copy of warrant on the
land/house of the judgment-debtor.

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 Moveable property not in possession of the judgment-debtor:
by an order prohibiting the person in possession thereof from
giving it to the judgment- debtor.
Immovable property: 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
(R.54).
Property in custody of court/public officer: by notice to the
court/officer requesting that such property may be held subject to
the court's order.
Negotiable instruments: by actual seizure and bringing it to
the court.
Debts: by an order prohibiting the creditor from recovering
the debt and the debtor from paying it.
Shares in a company: by an order prohibiting the person in
whose name the share stands from transferring it or receiving
dividend thereon.
Share/interest in moveables (as co-owners): by a notice to
judgment debtor prohibiting him from transferring or charging
it.
Salary or allowances of government/private employees: by an
order the amount is withheld from such salary or allowances either
in one payment or by monthly installments.
Partnership property: by making an order charging the interest
of the partner in the firm's property; appointing a receiver of the
share of the partner in profits; directing accounts and inquiries;
and ordering sale of such interests.
Decree: If the decree is for payment of money or sale in
enforcement of a mortgage or charge, passed by the court
executing the decree - then by order of such court; if passed by

15
 another court - by issuing a notice to such court requesting it to
stay execution thereof.
For other decrees: attachment is by issuing a notice to the
decree-holder prohibiting him from transferring it or charging it in
any way; to the executing court from executing it until such notice
is cancelled (R.53).

Bibliography
Avtar Singh; Code of Civil ProcedureCentral Law Publications, 2014.
D.N Mathur; The Code of Civil Procedure Central
LawPublications(second ed.) 2011.
Jain A.K., Code of Civil Procedure, Ascent Publications, 2016.
Mulla; The Code of Civil Procedure Lexis Nexis
ButterworthsPublications(18th Ed.), 2011.
Takwani C.K., Civil Procedure with Limitation Act, 1963, Eastern Book
company, 2016, 7th ed.
http://www.lawyersclubindia.com/articles/Attachment-of-Property-
4279.aspaccessed on 20-03-2017 at 9:30 pm.
https://www.lawctopus.com/academike/concept-execution/ accessed on
12-03-2017 at 10:30 am.

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Table of Contents

Introduction1
Execution of a Decree................................................................................................. 1
Meaning...................................................................................................................... 1
Nature & Scope.......................................................................................................... 2
Object......................................................................................................................... 2
Attachment..

..3
Exemption of Properties from Sale and Attachment...................................................3
Judicial Decisions on Sec. 60: Expanding the Scope of the Properties
Enumerated......................................................................................................... 4
Changes Made By 1976 Amendment...................................................................9
Effect of
Attachment
.10

17
Private Alienation of Property after Attachment: Section 64....................................11
Auditor's
duty
...11
Modes of Attachment............................................................................................... 12
Bibliography............................................................................................................. 14

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