Source: Supreme Court 

Why in News? 

Recently, the Supreme Court in the matter of Renjith K.G. & Others V. Sheeba has held that a third party may file a suit under Order XXI Rule 99 of the Code of civil Procedure, 1908 (CPC) during pendency of litigation to claim his rights. 

What was the Background of Renjith K.G. & Others V. Sheeba Case? 

• In the present case, the original dispute centered around a property which originally belonged to one Ayyapan (deceased), who had eight children. 
• Ayyapan executed two mortgages in favor of Kunjan (deceased), in 1911 and 1919 respectively. 
• After Ayyapan's death, six of his children assigned their 6/8 shares to Raghuthaman (Third Party) by gift deed. The remaining 2/8 shares were obtained by Defendant No.1, Padmanabhan (judgement debtor) 
• Upon the death of the mortgagee Kunjan, his rights devolved to Defendant No.1 and the original plaintiff (decree holder) Padmakshy (who was a minor at that time). 
• Defendant No.1, without Padmakshy's concurrence, executed a mortgage for Rs.1,000/- in favor of one Nanu. Nanu subsequently assigned his right to Defendant NO. 10 (Veeran) who subsequently assigned his rights to Raghunatham. 
• Padmakshy filed a suit before the Trial Court for partition and separate possession of her share in the immovable properties. 
•  A final decree was passed allocating one half portion of the property to the plaintiff and directing Defendant No.10 to pay certain sums for equalization and mesne profits. 
• The plaintiff filed an Execution Petition to execute the decree and a portion of the property was delivered to the plaintiff as per the decree. 
• Subsequently, Raghuthaman filed applications under Order XXI Rule 99 of CPC seeking re-delivery of the property, injunction, and damages. All the three applications were jointly heard and were dismissed by the Trial court. 
• Aggrieved, the same execution appeals were filed before the Kerela High Court which also got dismissed. 
• The application was filed by the legal representatives of Raghuthaman to review the said judgement which was re heard by the High Court and the application was subsequently allowed. 
• The same order has been challenged by the appellant before the Supreme Court. 

What were the Court’s Observations? 

• The Supreme Court observed that: 
  • A person who is not a party to the original decree (a third party) has the right to approach the court under Order XXI Rule 99 of the Civil Procedure Code if they are dispossessed from a property during the execution of a decree. 
  •  The term "any person" in Order XXI Rule 99 includes a pendente lite transferee (someone who acquired an interest in the property while litigation was pending) who was not impleaded in the original suit. 
  • A pendente lite purchaser has the right to defend their rights, title, interest, and possession of the property. 
  • When a third party resists the delivery of property, it is incumbent on the decree holder to implead them by filing an application under Order 21 Rule 97 of the CPC. 
  • Once an application under Order XXI Rule 99 is filed, the trial court must consider all rival claims, including the right, title, and interest of the parties under Order 21 Rule 101 of CPC 
  • Order 21 Rule 101 bars a separate suit by mandating the execution court to decide the dispute. 
  • Regarding limitation for execution of a partition decree, the time begins to run from the date of the final decree, not from the date it is engrossed on stamp paper. The engrossment of a final decree in a partition suit relates back to the date of the decree. 
  • A party cannot stop the running of the limitation period by their own act of not furnishing stamp paper for engrossment of the decree. 
  • The starting of the limitation period for execution of a partition decree cannot be made contingent upon the engrossment of the decree on stamp paper. 
• The Supreme Court therefore,  
  • Affirmed the High Court's decision to set aside the order passed in the Execution Petition and remand the matter to the trial court for fresh consideration. 
  • Left all issues, including the independent right, title, or interest claimed by the respondents in the property, to be adjudicated by the trial court. 

Landmark Judgements 

• Chiranji Lal (D) by LRs. v. Hari Das (D) by LRs. (2005) 
  • In this case the Court held that for a partition decree, the limitation period begins from the date of the final decree, not from when it's engrossed on stamp paper. 
  • It was ruled that a party can't delay the start of the limitation period by not furnishing stamp paper. 
  • The Court emphasized that the engrossment of a decree on stamp paper relates back to the date of the decree. 
• Sriram Housing Finance & Investment (India) Ltd. v. Omesh Mishra Memorial Charitable Trust (2022) 
  •   In this case the court distinguished between the rights of a decree holder and a third party in execution proceedings. 
  • It clarified that only a decree holder can file an application under Order XXI Rule 97 of CPC. 
  • The Court explained that Order XXI Rule 99 is applicable to a person who has been dispossessed of property during execution. 
• Yogesh Goyanka v. Govind (2024) 
  • In this case the Court clarified that transfers made during pending litigation (pendente lite) are not automatically void.  
  • It was held that such transfers are subservient to the rights of the parties in the pending litigation. 
  • The Court supported a liberal approach to allowing subsequent transferees to protect their interests in legal proceedings. 

What is Order XXI Rule 99 under CPC? 

• Order XXI states the rules for Execution of Decrees and Orders Payment under Decree. 
• The term decree has been defined under Section 2(2) of CPC which states that: 
  • Decree means the formal expression of an adjudication which, so far as regards the Court expressing it, conclusively determines the rights of the parties with regard to all or any of the matters in controversy in the suit and may be either preliminary or final. It shall be deemed to include the rejection of a plaint and the determination of any question within section 144, but shall not include 
    • any adjudication from which an appeal lies as an appeal from an order, or 
    • any order of dismissal for default. 
• Rule 99: Dispossession by decree-holder or purchaser 
  • It states that : 
    • As per Sub rule (1) where any person other than the judgment debtor is dispossessed of immovable property by the holder of a decree for the possession of such property or, where such property has been sold in execution of a decree, by the purchaser thereof, he may make an application to the Court complaining of such dispossession. 
    • As per Sub rule (2) Where any such application is made, the Court shall proceed to adjudicate upon the application in accordance with the provisions herein contained.