2 years, 9 months ago

CPC| Order For Rateable Distribution Of Property Among Various Decree Holders Bars Them From Setting-Off Their Individual Debt: Kerala High Court

The Kerala High Court recently ruled that under the Code of Civil Procedure, when there is an order of rateable distribution for a property in favour of separate decree holders, one of them cannot claim to set-off their entire debt from the sale proceeds. "A conjoint reading of Section 73 and Order XXI Rule 72 would show that whenever a set-off is allowed, the order of rateable distribution shall have to be reckoned with and only after ascertaining the proportionate amount entitled by the decree holder-purchaser, his entitlement to set off can be decided. Thus, the 1st respondent sought to set aside the sale arguing that the Execution Court allowed the appellant's application to participate in the auction and to allow set-off without notice to the 1st respondent. The Execution Court set aside the sale holding that the order of rateable distribution was in vogue despite confining the auction to 18 cents.

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