Understanding The Interplay Between Order XXI Rule 66(2) And Rule 90 CPC: SC Clarifies Limits Of Post-Sale Challenges

Execution proceedings under the Code of Civil Procedure, 1908 (CPC) often give rise to more litigation than the suit itself. One recurring dispute concern as to when a judgment-debtor may challenge an auction sale and what grounds may be raised. The Supreme Court's recent judgment in G.R. Selvaraj (Dead), through LRs. versus K.J. Prakash Kumar and others, has finally clarified the long-standing confusion between Order XXI Rule 66(2), which deals with settlement of the sale proclamation and Order XXI Rule 90, which provides for applications to set aside sale.

The Court held that grounds which could have been raised at the time of settling the proclamation under Rule 66(2) cannot later be used to attack the sale under Rule 90. This resolves a major procedural bottleneck that regularly clogs execution courts.

Understanding the Concept

When a decree is passed, the decree-holder proceeds to execute it under Order XXI of the CPC. It is the responsibility of the executing court to recover the decreed amount from the judgment-debtor (hereinafter as “JD”), and for that purpose, the court has several modes available. One such mode is the attachment and sale of the JD's property. Order XXI Rule 64 empowers the executing court to sell only so much of the attached property as is necessary to satisfy the decree. This rule acts as a safeguard to ensure that the debtor does not lose more than what is legally owed and that property is not sold unnecessarily. Further, Rule 65 states that such sale shall be made by public auction. It is at this stage that Order XXI Rule 66(2) comes into the picture. It deals with the proclamation of sale by public auction. This is a stage when the court finalises essential details such as the description of the property, valuation, incumbrances, and other particulars relevant to potential bidders. Such proclamation is drawn up after notice to JD. The JD is expected to participate meaningfully at this stage and place all objections before the court. The Supreme Court in Selvaraja observed that these proceedings are foundational. They shape the subsequent conduct of the sale and ensure transparency and fairness. If a party fails to appear or intentionally refrains from raising an objection at the Rule 66(2) stage, they are deemed to have waived that right.

In contrast, Order XXI Rule 90 provides for a application to set aside sale.The object is to provide a limited remedy, and a sale may be set aside only if two conditions are met. First, there must be a material irregularity or fraud in publishing or conducting the sale and, second, such irregularity or fraud must cause substantial injury (sub-rules 1 and 2 of Rule 90). However, with the introduction of Rule 90(3) through the 1977 Amendment, challenges are now expressly barred “on any ground which the applicant could have put forward on or before the date on which proclamation was drawn up.” The purpose of amendment was to stop JD from raising late objections in the execution process. In Selvaraja, the Supreme court emphasised that this statutory bar is mandatory and cannot be circumvented by re-characterising pre-proclamation issues as post-proclamation irregularities. Issues such as incorrect valuation, incomplete description of property, or failure to reflect encumbrances are inherently matters falling within the scope of Rule 66(2) and cannot be dressed up as “material irregularities” under Rule 90. If a party “sleeps over their rights” at this stage, they cannot resurrect the same grievance later.

Confusion in Judicial Practice

Over decades, courts have struggled with one question: Can a judgment-debtor challenge the auction sale on grounds that existed before the proclamation but were not raised earlier? Different High Courts took inconsistent views: Some treated Rule 66(2) and Rule 90 as independent, allowing broader grounds at the Rule 90 stage. Others strictly enforced Rule 90(3), barring any ground available earlier. This inconsistency caused considerable uncertainty and often placed bona fide auction purchasers at risk.

What the Supreme Court Clarified

Supreme Court resolves this conflict by giving primacy to Rule 90(3) in a case where JD had earlier notice of any irregularity. The Court holds that the JD's silence or acquiescence before sale despite having opportunity and notice bars later challenge on ground of unnecessary sale of whole property. The judgment also aligns with earlier decisions such as Desh Bandhu Gupta v. N.L. Anand (1994), Ambati Narasayya v. M. Subba Rao (1990), and Balram v. Ilam Singh (1996), where the Court highlighted that auction sales must be conclusive and are not meant to be reopened casually.

The judgment makes it clear that the proclamation stage under Rule 66(2) is not just a procedural step but an essential safeguard meant to ensure proper valuation and a fair, transparent sale process. Likewise, Rule 90 is not meant to give a second chance to raise objections that should have been brought up at the earlier stage. The decision strengthens the position of bona fide purchasers, minimises the scope for dilatory tactics, and enhances the overall efficiency of the execution process. As the Supreme Court has repeatedly held since Ghanshyam Das v. Anant Kumar Sinha (1991), execution proceedings must remain efficient and should not be reduced to unnecessary procedural manoeuvring. The court said that sale proclamations, once final, cannot be revisited indirectly through Rule 90.

To put it simply, if the JD had notice of any material irregularity at the stage of drawing up the proclamation of sale and failed to raise an objection at that appropriate time, then he would be barred from raising such an objection later by virtue of Rule 90(3). However, if the JD did not have such notice, then Rule 90(3) would not get attracted in such case and the JD may file an application to set aside the sale at a later stage of execution proceedings, provided the conditions under Rule 90(1) and (2) are fulfilled.

Execution proceedings have long been recognized for generating more litigation than the original suit, particularly when auction sales are challenged on technical or procedural grounds. A recurring dispute in courts across the country has been whether a judgment-debtor is entitled to attack an auction sale on grounds that were available before the proclamation of sale but were not raised at the appropriate stage. The Supreme Court's decision resolves this persistent confusion by holding that any objection available under Rule 66(2) of Order XXI must be raised before the proclamation is settled, and such objections cannot subsequently be invoked to set aside the sale under Rule 90. The judgment harmonises Rule 66(2) and Rule 90(3) and reiterates that execution cannot become endless litigation.

Author is Practicing Advocate at Allahabad High Court. Views Are Personal.