This article has been written by Oishika Banerji of Amity Law School, Kolkata. This article discusses Section 60 of the Code of Civil Procedure, 1908 which deals with property liable to attachment and sale in execution of decree. 

It has been published by Rachit Garg.

Introduction 

Every civil lawsuit has three stages, beginning with the filing of the lawsuit, followed by the decision on the lawsuit, and then the actual litigation itself. The litigation’s implementation phase, also known as the execution phase, is where the decision’s outcomes are put into practice. A court may order the transfer of certain debtor property to a creditor or the sale of such property for the benefit of the creditor through the legal process of attachment. Any property that belongs to the judgement debtor, or any property over which he has disposing authority that he may exercise for his own benefit, is subject to attachment and sale in the course of carrying out a judgement. The subject matter of property attachment is covered in Sections 60 to 64 and Rules 41 to 57 of Order 21 of Code of Civil Procedure, 1908 (CPC). This article discusses Section 60 of CPC, 1908 specific alongside judicial reasoning concerning the same. 

All about Section 60 of CPC, 1908

Property that can be attached and property that cannot be attached are both covered under Section 60 of CPC, 1908. All movable property belonging to the judgement debtor, excluding assets that are expressly excluded, including lands, houses or other buildings, goods, money, bank notes, checks, bills of exchange, hundis, promissory notes, government securities, bonds or other securities for money, debts, and shares in a corporation, may be attached and sold in fulfilment of a judgement against him. The decree described in this Section is not a mortgage decree; it is merely a money decree. It is crucial that the property not only belongs to the judgement debtor but also that he has the ability to dispose of it in his favour. 

The proviso covers the property excluded from attachment and sale to Section 60(1). Agriculture products are partially excluded from the attachment under Section 61. It comprises necessities like clothing, bedding, kitchenware, animal husbandry instruments, dwellings for farmers, wages, pensions, and gratuities, as well as deposits that are required and the right to future maintenance. Regarding whether the judgement-debtor has the option to forego the advantage granted by this proviso, there are two opposing views.

As such, Section 60 of the Civil Procedure Code is not exhaustive by nature, as have been rightly observed in the case of Ramesh Himmatlal Shah v. Harsukh Jadhavji Joshi (1975). It also includes any other saleable property, both movable and immovable, whether it is held in the judgement debtor’s own name or on his behalf by a third party. Right to occupy a flat is tangible property that can be sold or attached. Therefore, if a particular species of property is otherwise marketable, its specific exclusion from inclusion under Section 60 has no bearing on its marketability.

The Delhi High Court’s observation in the 2019 case of Ms. Sujata Kapoor v. Union Bank Of India And Ors had further summarised that the main clause of Section 60 CPC lists several properties owned by the judgement-debtor that is subject to attachment and sale in order to carry out a judgement, including lands, homes, and other structures. However, the addendum to Section 60(1) makes exceptions for certain types of properties that are not subject to attachment and sale. Evidently, the Parliament included an exemption for the poorest classes of people, including farmers, labourers, and domestic helpers, in Clause (c) of the proviso to Section 60(1).

Structure of Section 60 CPC, 1908 

Section 60 of the CPC, 1908 lays down a list of properties that are to be liable for attachment and sale in the execution of a decree. As have been discussed previously, the properties are:

1. Lands,
2. Houses or other buildings,
3. Goods,
4. Money,
5. Bank-notes,
6. Cheques,
7. Bills of exchange,
8. Hundis,
9. Promissory notes, 
10. Government securities,
11. Bonds or other securities for money,
12. Debts,
13. Shares in a corporation. 
14. All other saleable property, whether movable or immovable, that belongs to the judgement debtor or over which, or the profits of which, he has a disposing power that he may exercise for his own benefit, regardless of whether the property is held in the judgement debtor’s name or by another person in trust for him or on his behalf. 

Followed by this, Section 60 of CPC, 1908 also lays down a list of items that shall not be liable to the above-mentioned attachment or sale. The same has been discussed in the heading below. 

Items not eligible for attachment or sale under Section 60 CPC, 1908

1. The essential clothing, cooking utensils, beds and bedding of the judgement debtor, his wife, and children, as well as any personal adornment that, according to religious custom, no lady should be allowed to part with.
2. Tools of artisans, and, if the judgement debtor is an agriculturalist, his implements of husbandry, such cattle and seed-grain as may, in the court’s opinion, be necessary to enable him to earn his living as such, as well as a such portion of agricultural produce or of any class of agricultural products that may have been declared to be exempt from liability under the provisions of the section that follows this one.
3. Books of account.
4. Dwellings and other structures belonging to an agriculturist or a labourer of a domestic worker and occupied by him, along with the materials, sites, and land directly adjacent to and necessary for their enjoyment. 
5. A mere right to sue for damages.
6. Political pensions, as well as stipends and gratuities permitted to pensioners of the government, a local government, or any other employer, or due from any service family pension fund thus announced in the Official Gazette by the Central Government or the state government;
7. The salary for domestic workers and labourers, whether it is payable in cash or in kind;
8. Salary in the execution of any decree, excluding a decree for maintenance, up to the first 1,000 rupees and two-thirds of the remaining amount.
9. The salaries and benefits of individuals are covered by the Air Force Act of 1950, the Army Act of 1950, or the Navy Act of 1957.
10. The Provident Funds Act of 1925 currently applies to all mandatory deposits and other sums in or derived from funds, insofar as those monies are proclaimed by the aforementioned Act to be exempt from attachment.
11. Any sums due under a life insurance policy on the judgement debtor;
12. The interest of a lessee of a residential structure to whom the requirements of the law relating to the management of rents and accommodations are now applicable;
13. Any allowance included in the pay of any government employee, an employee of a railroad, or employee of a municipal government that the appropriate government has declared free from attachment, as well as any subsistence grant or allowance given to that employee while they are on suspension.
14. Any right of personal service. 
15. A hope for succession through survivor’s rights or another merely hypothetical or potential right or interest;
16. A claim to maintenance in the future;
17. Any allowance determined to be exempt from attachment or sale in fulfilment of a decree by any Indian legislation, and
18. Any movable property that is exempt from payment of land revenue under any current law that applies to the judgement debtor is not considered to be part of that obligation.
19. Sale in order to make up for revenue arrears. 

Explanations provided to Section 60 CPC, 1908

Section 60 of the CPC, 1908 provides 6 explanations, which have been explained in simple terms hereunder: 

1. Before or after they are actually paid, the funds related to the items listed in clauses (g), (h), I (ia), (j), (l), and (o) are exempt from attachment or sale, and, in the case of salary, the attachable component thereof is subject to attachment before or after it is actually paid.
2. In Sections I and (ia), “salary” refers to the whole monthly emoluments received by a person from his employment, whether on duty or on leave, except any allowance designated exempt from attachment under the rules of clause (1).
3. “Appropriate Government” in paragraph (1) means: 

1. With regard to any employee of the Central Government, any employee of the railway administration, the cantonment authority, or the port authority of a major port; 
2. In regards to any additional government employees or employees of any other local authorities, the state government. 

4. The terms “wages” and “labourer” both refer to skilled, unskilled or semi-skilled labourers for the purposes of this proviso.
5. For the purposes of this proviso, an “agriculturist” is a person who personally cultivates land and who relies heavily on the revenue from agricultural land, whether as an owner, tenant, partner or agricultural labourer, in order to make ends meet.
6. An agriculturalist will be considered to personally cultivate the land for the purposes of Explanation V if he cultivates land—

1. Through his own work, or
2. Through the labour of any family member, or
3. By employees who are paid in cash, in kind (rather than as a part of the produce), or both, as servants or labourers.

An agreement by which a person undertakes to forfeit the advantage of any exemption under this Section shall be void, regardless of anything else stated in any other legislation currently in effect. Nothing in this section shall be construed as releasing from attachment or sale in fulfilment of decrees for rent any such dwelling, building, site, or property, including the materials therein and the sites thereof and the lands immediately appurtenant thereto and necessary for their use. 

All you need to know about property liable to attachment and sale in execution of decree

A clause (kb) was added to Section 60(1) of the CPC in the year 1973 on the recommendation of the 54th Law Commission Report, which states that “property subject to attachment and sale in execution of the decree.” This clause exempted “all money payable under a policy of insurance on the life of the judgement-debtor” from attachment in the proceedings for the execution of the decree. The explanation under Section 60(1) of CPC further explains that the amounts payable in relation to the matters mentioned in clauses (g), (h), I (ia), (j), (l), and (o) are exempted from attachment or sale, whether before or after they are actually payable. In the case of salary, the attachable portion thereof is subject to attachment whether before or after it is actually payable.

The aforementioned explanation makes it clear that pension payments made to government employees or political pensions, wages paid to domestic workers and labourers, the first INR 1,000 of a salary or the remaining two-thirds of a salary, allowances for members of the armed forces or the air force, etc., covered by clauses (g), (h), I (ia), and (l) of Section 60(1) of CPC, regardless of whether they are payable or paid, are kept outside the list of assets that can be attached by the court executing the decree against the judgement-debtor.

Judicial decisions on property liable to attachment and sale in execution of the decree

1. In Parasram H. Bhojwani v. Pravinchand Sehgal (2021), the Bombay High Court adopted an intriguing stance regarding the question of whether the sum of money paid to the judgement-debtor during his lifetime under the life insurance policy on the life can be attached under Section 60 of the Civil Procedure Code, 1908, in order to satisfy a decree that is still pending against the said judgement-debtor. 
2. In Federal Bank Ltd. v. Indiradevi Kunjamma (1984), a similar Section 60 CPC problem involving the attachment of funds paid under a life insurance policy to the judgement-debtors’ lawful heirs was brought before the Bombay High Court in 1984. The Bombay High Court referred to the Supreme Court’s ruling in the case of Sarbati Devi v. Usha Devi (1983), in which to assert that it is no longer conceivable to retain the belief that funds payable under an insurance policy do not form a part of the decedent’s estate, the highest court of appeal considered it as a subject of attachment. 

The money payable or paid under the life insurance policy in the possession of the lawful heirs of the deceased judgement-debtor, however, was not subject to attachment by the Bombay High Court, who instead extended the protection granted by clause (kb) of Section 60(1) CPC. In order to provide some security to the heirs and legal representatives of the deceased judgement-debtor, the Bombay High Court reasoned that the legislature intended to exempt from attachment the funds payable under a policy of insurance on the life of the judgement-debtor by enacting clause (kb) of Section 60(1) CPC.

Given this circumstance, the exemption outlined in clause (kb) of Section 60(1) CPC applies to the same funds even though they are gradually becoming a part of the decedent’s estate. Due to the aforementioned clause (kb) of Section 60(1) CPC, funds payable under an insurance policy on the life of a judgement-debtor are completely exempt from attachment and sale regardless of whether the insurance policy matures during the assured’s lifetime or the funds become due after his death.

In the case of Parasram H. Bhojwani v. Pravinchand Sehgal (2021), the Bombay High Court cited its own decision in Federal Bank (1984) and reasoned that it was rendered in connection to a dispute where the issue concerned the attachment of the judgement-life debtor’s insurance policy beyond its lifetime. The Court stated that clause (kb) of Section 60(1) CPC completely exempts the proceeds of an insurance policy on the life of a judgement debtor from attachment and sale, regardless of whether the insurance policy matures during the assured’s lifetime or the proceeds become due after his death.

The Bombay High Court noted the differences between the facts of the Federal Bank case and the Parasram H. Bhojwani case, stating that the fact in the latter related to the payment of the money upon policy maturity during the insured person’s lifetime, whereas the issue in the former was limited to the payment of the life insurance policy upon the insured person’s death. The Court is, therefore, inclined to consider the facts of the case of Parasram H. Bhojwani when determining whether clause (kb) of Section 60 CPC is applicable.

Unquestionably, the Court recognised the Federal Bank ruling, implying that the purpose was always that any future amounts due, including insurance policies, could not be attached because the beneficiaries of an insured person’s death are their heirs. The Court cited the explanation provided under Section 60 CPC in stating that the items mentioned in clauses (g), (h), I (ia), (j), (l), and (o) of the provisions are exempted from attachment regardless of whether the amount is paid before or after the explanation’s reference.

3. In the case of Canara Bank v. N. Palani (1995), the parties went before the Madras High Court to appeal the lower court’s decision to allow attachment of the fixed deposit receipt containing the funds received from the deceased judgement debtor’s life insurance policy. They argued that this was illegal under Section 60 CPC’s clause (kb), which states that the funds payable under a life insurance policy cannot be attached to carry out a judgement.

According to the Madras High Court, the term “due,” with regard to the protection provided by clause (kb) of Section 60 CPC, can no longer be extended to money once the policy matures and it has been paid as long as it still has the character of being payable under a life insurance policy. The Madras High Court took the decision in the Federal Bank case under consideration but determined that it would not apply in this case because the issue in the Federal Bank case concerned the attachment of money payable under an insurance policy, whereas the issue in the current case relates to the attachment of a fixed deposit receipt.

Referring to the case of Sebastian Jose v. Indian Overseas Bank Ltd. (2009), the Madras High Court in the present case held that so long as money is received as amounts payable under life insurance, it is protected by clause (kb) when received by the policyholder while he is still alive. However, when money is received by the policyholder’s legal representative after his death, it becomes his estate and is subject to attachment.

4. In Radhey Shyam Gupta v. Punjab National Bank (2008) and Union of India v. Wing Commander R.R. Hingorani (1997), the Supreme Court held that the money is protected from attachment under Section 60 CPC as long as it retains the character of a pensionary benefit converted into a fixed deposit. Using the same reasoning in the case of insurance policies, the Apex Court observed that the exemption under clause (kb) will only be effective as long as the amount is still in the pensionary benefit. Once received, the sum would no longer be considered “payable,” eliminating the possibility of exemption.

If the policy matures within the insured’s lifetime, the funds would no longer be protected by Section 60(1)(kb) of CPC, 1908 after the insurance firm has paid the maturity value and distributed the assets. The safe confines of provident funds, pensions, and required deposits, which are highlighted in the explanation to Section 60 CPC, do not include payments received at the maturity of a life insurance policy. As the Federal Bank’s judgement did not take the explanation to Section 60(1) of the Code into account, the aforementioned decision stands out.

5. In the case of Pulugu Karnakar Reddy v. Shreya Financiers and Hire Purchase (2006), a party challenged the lower court’s ruling attaching the sum payable under the life insurance policy to the legal heirs of the deceased judgement-debtor, before the Andhra Pradesh High Court. Referring to the 54th Law Commission Report, the Court noted that the main goal of enacting clause (kb) of Section 60 is to encourage thrift and the habit of owning a life insurance policy. However, in order to take a liberal stance, an exemption for life insurance policies is required. Taking into consideration the Federal Bank Ltd. ruling from the Bombay High Court, an exception was made under clause (kb) of Section 60 for the non-attachment of the money payable under the insurance policy and therefore the Andhra Pradesh High Court acknowledged that the legislative objective was to offer exemption to the insurance policy.
6. In the case of V.P. Arora v. Punjab National Bank (1991), one OP Arora was the subject of a judgement which made him liable for payment, and his son VP Arora served as a judgement debtor and guarantor. OP Arora passed away; his execution was carried out, and his primary residence was attached. Shanti Devi, the wife of OP Arora, along with VP Arora were listed as legal representatives. Shanti Devi submitted objections invoking the defence provided by Section 60(1)(ccc) of the CPC, 1908. Shanti Devi left VP Arora the benefit of her bequest when she passed away.

The home that had previously belonged to OP Arora was afterwards acquired by VP Arora. It is important to note that VP Arora participated in the proceedings as a judgement debtor. The division bench of the Delhi High Court was asked to decide whether the judgement debtor could take advantage of proviso (ccc) of Section 60(1) of the CPC, 1908 if he acquired ownership of a home after a decree or attachment and it happened to be his primary residence. 

When deciding what would happen to the suit property, the Court considered the facts of the case, the relevant provisions of the Hindu Succession Act, 1956 that applied following the death of OP Arora, and proviso (ccc) of Section 60(1) of CPC. The Court concluded its ruling by holding, “It barely matters if he held the house when the decree was enacted or acquired ownership of it after it was sought to be sold or attached. For this reason, the phrase “or” was used by the law’s drafters between attachment and sale.” In the end, the Court had determined that VP Arora must remain a judgement debtor and continue to own the property as his primary residence before it may be sold.

7. In the matter of Bomminayana Nirmala v. Rachapathu Krishnamurthy (2010), the Andhra Pradesh High Court was entrusted with interpreting the validity of clause (kb) of Section 60 CPC, 1908 for the attachment of money payable under the insurance policy. In this instance, a creditor sued the legal heirs of the judgement debtor who passed away prior to the filing of the suit in order to reclaim the debt. A judgement was rendered against the legal heirs, and the Court enforcing the judgement mandated the attachment of the sum due to the legal heirs under the dead debtor’s life insurance policy.

The party filed a revision petition in opposition to the executing court’s order attaching funds due under the insurance policy. The Court determined that the sum payable under the insurance policy on the life of the deceased debtor is free from attachment for any amount due by the insured under clause (kb) of Section 60 CPC by referring to the judgement in the Federal Bank case.  Therefore, under Section 60 CPC, the insurance amount is immune from attachment before judgement by the executing court if the lawsuit was brought against the legal heirs as the policy successors. 

Frequently Asked Questions (FAQs)

What are the attachable properties?

The attachable properties are categorised by Section 60 of CPC, 1908 as follows: 

1. Land, houses, buildings, goods, money, banknotes, checks, bills of exchange, promissory notes, bonds, or other securities convertible into money, government securities, debts, and shares.
2. Any other sellable property that JDR owns or has the authority to dispose of for his own gain.

Whether mangalsutra of women is attachable?

The necessary clothing, cooking utensils, beds, and bedding for the judgement debtor, his wife, and children, as well as any personal adornment that, according to religious custom, no woman should be allowed to part with, are listed in Section 60 (1) proviso (a). Therefore, since the mangalsutra are ornaments used in Hinduism, no lady can part with them and they are not subject to attachment.

Whether musical instruments of musicians are attachable?

Tools for artisans, husbandry implements, and other items described in proviso to Section 60(1) of the CPC, 1908 cannot be attached. However, a musician is not an artisan, as the term “artisan” refers to someone who performs manual labour. Similarly,

1. Surgeon’s instruments.
2. Laundry appliances.
3. A company that employs artisans is not eligible for exemption.

Is there any exemption for a particular category of houses?

Section 60(1)’s proviso’s clause c provides that houses owned by farmers are exempted from CPC. An “agriculturist” is someone whose livelihood is entirely or primarily derived from farming land. He doesn’t have to be an owner; he could be a tenant or a worker for this type of land cultivation.

Whether a right to sue for damages can be attached?

Section 60’s proviso’s clause (e) (1) provides that a right to claim for damages is free from attachment under CPC, 1908 because it cannot be sold or transferred as property. A judgement or award of damages, however, may be affixed because it is transferable.

Is a pujari’s right to accept contributions in a temple exempt from attachment?

The “Right of personal service” is immune from attachment under sub-section (f) of the proviso to Section 60(1) CPC, 1908. However, an offering is attachable when the right to accept it at a temple is distinct from the requirement to perform a service of a personal kind.

Does any clause completely exempt “wage” from attachment?

The proviso to Section 60(1) CPC’s clause (h) states that domestic workers’ and labourers’ pay are completely immune from attachment. Personal manual work is the requirement for being referred to as a labourer, not prior education or training in a particular skill.

Conclusion 

Section 60 of the Code of Civil Procedure,1908, states that all properties that can be sold are subject to attachment and sale in order to carry out the judgement. The property listed therein is likewise free from attachment and sale during the execution of a decree, according to the provision. As a general rule, all property, both movable and immovable, including shares of companies, buildings, and agricultural land, as well as movable goods like cash and other items, is considered to be property, owned by the judgement debtor, who has the exclusive right to hold and process it.  

References 

1. https://districts.ecourts.gov.in/sites/default/files/attachment%20of%20property%20in%20execution%20-%20Sri%20D%20Vishnu%20Prasada%20Reddy.pdf.

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