Order XXI Rule 90 of the CPC Requires the Applicant to Deposit up to 20% amount on the Direction of the Court, not without Direction at the time of Filling Application.
๐๐๐๐ค๐ ๐ซ๐จ๐ฎ๐ง๐:
Once an immovable property has been sold in pursuance of execution of a decree, and a person feels aggrieved of it and wants to file an application before the court to set the sale aside, he needs to file such an application under Order XXI Rule 90 of the CPC along with certain amount not exceeding 20% of the total sum of the sale. The question is whether the said amount needs to be deposited while filing the application or it should be deposited on the direction of the court.
The issue of deposit of the amount with or without direction of the court has been a point of debate of judicial pronouncements. Different High Courts held that the amount needs to be deposited on the direction of the court, not otherwise. However, the Supreme Court held inย Habib and Company v. MCB (PLD 2020 SC 227), that it is mandatory to deposit the amount first to entertain the application. Otherwise the application will not be entertained.
The Supreme Court constituted a larger bench for the interpretation of proviso to said rule,which is reproduced herein below:
“…Provided further that no such application shall be entertained unless the
applicant deposits such amount not exceeding twenty per cent of the
sum realised at the sale, or furnishes such security, as the Court may
direct.”
The larger bench of the SC revisited its earlier view and set aside it, holding that it is not necessary that an applicant shall deposit the amount to entertain the application. The Court held that the phrase “not exceeding 20%” implies that it is up to the court to determine the amount first and then direct the applicant to deposit it. The proviso does not require the applicant to deposit it while filing the application or even at a later stage but without the court’s direction.
The SC further held that clauses (a) and (b) of Section 19(7) of the Financial Institutions (Recovery of Finances) Ordinance 2001 (โOrdinanceโ) are not in contradistinction with Order XXI Rule 90, rather, the later is complementary to the former. CPC is not applicable to the Banking Courts where the Ordinance provides a procedure, otherwise it is applicable. If a provision of the CPC Complements a provision or a section of the Ordinance, the Banking Court shall adopt it and follow the procedure in the complementary provision.
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