The Civil Code of Procedure (CPC) defines Attachment of Property

Before purchasing, buyers should confirm that a property is free from legal issues. They must comprehend ideas from the Code of Civil Procedure (CPC), such as “Attachment of Property,” to do this. Attachment is the legal term for taking possession of property before it receives issuance of a final judgment. Continue reading to learn how it impacts real estate transactions and the Supreme Court’s ruling. 

Buying real estate is harder than it seems. The process involves a great deal of research and multilevel verification. A property can be embroiled in a legal dispute, which could cause the sale to be delayed or even void. How can purchasers safeguard their rights in such a case? The solution is to understand key legal terminology, such as CPC’s definition of attachment of property.

What the CPC defines as a property attachment

According to the Code of Civil Procedure (CPC), attachment of property is the legal term for a procedure for taking possession of someone’s belongings to obtain a judgment. This is done to stop the defendant from selling or concealing any property that could influence a judge’s decision. For the complainant (plaintiff), property attachment serves as a type of security, guaranteeing the availability of the property to satisfy the judgment. The Code of Civil Procedure (CPC), which controls civil proceedings in India, defines the attachment rules.

Types of attachment 

The timing of the property’s attachment depends on the particulars of the case and the laws governing the jurisdiction. Below, let us examine each type of attachment.

Attachment before evaluation: This preventive measure is done before the final decision to ensure that the property is still available to fulfill the decree.

In the process of executing a decree, attachment occurs when the court seizes the property of a judgment debtor or the party who has lost the case. This procedure guarantees that the judgment debtor’s assets will be available to support the court’s decision.

How are the court orders being carried out now? Order 21 of the CPC executes decrees and orders. Let us explore this concept in more detail. 

Order 21 about property attachment in CPC

Putting court orders in action, including property attachments, is what Order 21 of the CPC entails. Order 21 of the CPC deals with performing court orders, including the attachment of property. There are guidelines and protocols for implementing court orders for various asset classes, including movable and immovable property, wages, and bank accounts. 

Below is a comprehensive summary of the applicable  Order 21 regulations regarding the attachment of property.

  • Rule 41: Examination of Judgement Debtor 
  • Rule 42: Attachment in the Case of Decree for Rent or Mesne Profits or other matter 
  • Rule 43: Attachment of Movable Property 
  • Rule 46: Attachment of Debt, Share, and Other Property Not in Possession of Judgement Debtor
  • Rule 47: Attachment of Property in Custody of Court or Public Officer 
  • Rule 48: Attachment of Salary or Allowances of Servant of the Government or Railway Company or Local Authority 
  • Rule 49: Attachment of Partnership Property 
  • Rule 50: Execution of Decree against Firm 
  • Rule 51: Attachment of Negotiable Instruments 
  • Rule 52: Attachment of Property in Custody of Court or Public Officer
  • Rule 54: Attachment of immovable Property 
  • Rule 55: Removable of Attachment after Satisfaction of Decree

CPC attachment judgment by the Supreme Court 

Mattaparthi Syamala & Ors. vs. Kancherla Lakshminarayana (2008)

Kancherla Lakshminarayana brought legal action in this instance against Mattaparthi Syamala and other parties. He was afraid that in an attempt to evade paying any future judgment, the defendants might try to hide or sell their property. Consequently, prior to the decision being made, he asked the court to attach, or seize, the defendants’ property. According to Order 38 of the Code of Civil Procedure (CPC), this is referred to as “attachment before judgment.”

To ensure fairness and justice in civil litigation, this case emphasizes the function and significance of property attachment under the CPC as a tool to balance the interests of the plaintiff and the defendant.

In conclusion, the CPC oversees several procedures, such as property attachment, in civil cases in India. Buyers must understand this as it directly impacts the legality and security of real estate transactions. Understanding these legal requirements is essential to preventing disagreements and ensuring safe and secure real estate transactions. 

The Complete Guide to the National Company Law Tribunal (NCLT)

The Insolvency and Bankruptcy Board of India has suggested certain modifications to address the problems encountered by real estate projects. Real estate projects should be required to register with the Real Estate Regulatory Authority (RERA), according to suggestions made by the IBBI. Additionally, the authority has recommended that homeowners’ properties remain outside the liquidation process. 

To ease the bankruptcy process, the IBBI has suggested the following five modifications. The modifications include creating a distinct account for every real estate project, granting the Committee of Creditors permission to execute a lease or sublease agreement while the matter is pending, and giving the CoC access to review and recommend distinct plans for every project.

IBBI has invited public feedback on the proposed revisions. Homeowners whose investments stagnate in unfinished projects will likely benefit from the proposed amendments. 

Concerning the NCLT (National Company Law Tribunal)

In India, the National Company Law Tribunal has proven to be a reliable mechanism for resolving disputes between homebuyers and real estate builders in many cases. The Insolvency and Bankruptcy Code of 2016 required the National Company Law Tribunal to handle cases involving real estate developers’ bankruptcy and insolvency, even though the Real Estate Regulatory Authority (RERA) was in place in most states. 

Full-Form of NCLT

Those unfamiliar with the NCLT might be interested in learning what the NCLT Full Form comprises. The full name of the National Company Law Tribunal is NCLT. Every month, the National Company Law Tribunal publishes an NCLT Cause List that includes information about the parties, case, and state of resolution. The website for NCLT is https://nclt.gov.in/

Describe NCLT. 

A quasi-judicial body that primarily handles disagreements and matters about Indian companies and corporations is the National Company Law Tribunal. The 2013 Companies Act established the tribunal in 2016. 

The NCLT is involved in the agreements, compromises, arbitrations, reconstructions, divestitures, and business winding up. The Companies Act of India grants the National Company Law Tribunal the authority it requires to carry out its duties. Under the 2016 Insolvency and Bankruptcy Code, the National Company Law Tribunal acts as the deciding authority for cases involving companies and Limited Liability Partnerships (LLPs). 

Main Purposes of NCLT 

The following are the principal roles of NCLT: 

  • Registration of Companies: NCLT can challenge a company’s legitimacy during the registration and incorporation method. NCLT is also able to revoke the company’s registration.
  • Transfer of shares: The NCLT hears complaints from businesses that have had their requests to transfer shares and securities denied. 
  • Deposits: If a depositor has concerns, they can contact NCLT to request an omissions remedy. 
  • The power to investigate has the power to order an investigation. 
  • Asset freezing: When a company is the subject of an investigation, the assets may be frozen and used later.
  • Changing a public limited company into a private limited company: NCLT approval is needed if someone wishes to change a company’s status from public to private.  

The NCLT Cause List: What is it?

To hear cases of the companies, NCLT periodically publishes a list of cases known as the “NCLT Cause List.” The NCLT Cause list is nothing more than a calendar of the cases presently due for hearing on a given day. The NCLT Cause List order follows in holding the hearing. 

Names of the Parties, counsel for the petitioner/ applicant, counsel for the respondent, remarks, serial number, CP number, CA/IA number, purpose, section, and rule are among the fields in the NCLT Cause list. 

How can I access the NCLT Cause list on the Internet? 

The NCLT Cause list includes the hearing schedule and the details of the parties to the dispute. To check the NCLT Cause List online, follow the mentioned steps- 

  • Visit https://nclt.gov.in/, the National Company Law Tribunal’s website. 
  • Select the “Cause List” tab from the website’s home page. 
  • You will see a page open with a “PDF Cause List.”
  • It’s possible to look up the cause list from any NCLT branch in this window. The date range is another option. 
  • Select “Search” from the menu. You will see a list of the “NCLT Cause List.”