We all must have wondered that when a suit involves more than one plaintiff, and when the

suit is decided in favour of such plaintiffs, how the further process would
go. From passing of judgement to execution of decree, the whole process goes hand in hand. As such, a judgement for co-plaintiffs is passed as a whole but when it
comes to execution of decree, there might be a special provision.

For example, A and B are co-plaintiffs and the after the judgement in their favour they are decree-holders. For the purpose of execution of decree, since A is entitled
to the half the property in the suit related to property whereas B is entitled to only one fourth. The execution of such property is done in the matter of attachment and
sale. Whatever the amount be received after selling off that property, for the purpose of such execution of decree, A will get exactly half the amount where as B will
get exactly one fourth the amount. This process of distribution is called distribution of assets for civil suits and the provisions regarding the same are provided under
Section 73 of the Code of Civil Procedure, 1908.

The jurisprudential approach behind this provision intends to secure an equal footing for the purpose of execution of decree for the decree holders so that each of them
secures their equitable share lawfully. It has been held that the underlying object of Section 73 is twofold, firstly, to prevent unnecessary multiplicity of execution
proceedings and secondly, to secure equitable distribution of property by placing all the decree holders on same footing.[1]

Section 73 provides where assets are held by a court and more persons than one have, before the receipt of such assets, made application to the court for the execution
of decrees for the payment of money passed against the same judgment debtor and have not obtained satisfaction thereof, the assets, after deducting the costs of
realization, shall be rateably distributed among all such persons provided where any property is sold subject to a mortgage or charge, the mortgagee or incumbrancer
shall not be entitled to share in any surplus arising from such sale. Where any property liable to be sold in execution of a decree is subject to a mortgage or charge, the
Court may, with the consent of the mortgagee or incumbrancer, order that the property be sold free from the mortgage or charge, giving to the mortgagee or
incumbrancer the same interest in the proceeds of the sale as he had in the property sold. Where any immovable properly is sold in execution of a decree ordering its
sale for the discharge of an incumbrancer thereon, the proceeds of sale shall be applied— firstly, in defraying the expenses of the sale.

econdly, in discharging the amount due under the decree. Thirdly, in discharging the interest and principal moneys due on subsequent incumbrances, if any. Fourthly,
rateably among the holders of decrees for the payment of money against the judgment debtor, who have, prior to the sale of the property, applied to the court which
passed the decree ordering such sale for execution of such decrees, and have not obtained satisfaction. Where all or any of the assets liable to be rateably distributed
under this section are paid to a person not entitled to receive the same, any person so entitled may sue such person to compel him to refund the assets. Lastly, nothing
in this Section affects any right of the Government.[2]

There are few conditions which must be meted out for the purpose of application of the provision regarding distribution of assets which are that the applicant for
rateable distribution must have obtained a decree and applied for execution of decree to the appropriate court. Such application should have been made prior to the
receipt of the assets by the court. The assets of which a rateable distribution is claimed must be assets held by the court. The attaching creditor as well as the decree-
holder claiming to participate in the assets should be holders of decrees for payment of money and such decrees should have been obtained against the same
judgement-debtor.[3]

There has been a provision in subsection 3 of the section 76 which says that a priority shall be given to the Government debts during distribution of assets during
execution of a decree. The better understanding can be established for the same in the case of Excise and Taxation Officer v. Gauri Mal Butali Trust[4] wherein it was
stated that “The Common Law doctrine, that if the debts due to the Crown are of equal degree to the debts due to a private citizen, then the crown must have priority
against the private citizen, is a part of the law of this country. The preferential rights of the state in a democratic socialist republic are necessary, and raison d’être for
such a prevailed status given to a state, in view of its functions and duties, has to continue.

It must be also kept in mind that an order of execution of decree is not appealable therefore even a order made under section 73 of the Code for the purpose of
distribution of assets is not appealable though prior to the Amendment Act of 1976, it was made appealable. Similarly, a revision of the said order can be made if
provisions of section 115 are satisfied. As a concluding remark it can be said that the provisions for distribution of assets provides a fair claim for each decree holder.
It was further held that the remedy under the Civil Procedure Code is of superior judicial quality than what is generally available under other statutes, and the judge
being entrusted exclusively with administration of justice, is expected to do better.[5]

Conditions
The following conditions must be met to entitle a decree-holder to participate in the assets of a judgement-debtor and are essential
for the application of Section 73:
 1. An application must be made to the Court which holds the assets by the decree-holder claiming to share in the rateable
distribution;
2. Such an application should have been made before the receipt of assets held by the Court;
3. Only the assets held by the Court can be claimed in rateable distribution;
4. Both the attaching creditor and the decree-holder claiming to participate in the assets should hold the decree for payment
of money;
5. Such decree should have been obtained against the same judgement-debtor.

In the case of Bharat Paint Mart V. Bhagwati Devi, 1961, it was held that the essential conditions of Section 73 must be met for its
application as stated above.

The holder of a decree against two or more persons applies for a rateable distribution of the assets realized from the property of
one person, the application is one for the execution of the decree against the same judgement-debtor. Also, a decree against a
partner and a decree against him in his individual capacity are decreed against the same judgement-debtor. But a decree against a
firm and a decree against a partner in his individual capacity are not against the same judgement-debtor.

In the case of Boban V. Sajith Kumar, 2003, the Kerala High Court reiterated that the application for execution of decree must be
filed to the Court before the assets came into the custody of the said Court.

Separate Application
Section 73 does not require a separate application for rateable distribution and there cannot be any objection to include a prayer for
distribution of assets in an application which is, in fact, the execution of the decree itself   This can be observed in the case of M/s.
Suraj Lal V. P.R.K Sugar Works,1960 by the Allahabad High Court and Shamsunder and Co. V. Sunnilal Vesaji, 2001 by the Mysore
High Court, where the decree-holder had his decree under execution before the Court received the assets and was entitled to claim
rateable distribution. Section 73 has nothing in it that warrants the decree-holder to make a separate application for rateable
distribution.

Assets available for rateable distribution

Section 73 provides for a case where the assets are held by a court, and multiple individuals have made an application to the court
for the execution of decrees and payment of money before the receipt of assets. And have not obtained the assets after deduction
of the cost of realization. Such assets will be rateaby distributed among all persons entitled to the property provided if any property
is sold subject to mortgage or charge; the mortgagee shall not be entitled to share in any surplus arising from the sale. And any
property liable to be sold in execution of decree subject to mortgage or charge may be ordered by the Court to be sold free from
mortgage or charge with consent of the mortgagee, giving him the same interest in the proceeds of the sale as he had in the
property sold.

With regard to the distribution of the proceeds of the sale, Section 73(1)(c) provides, “Where any immovable property is sold in
execution of a decree ordering its sale for the discharge of an incumbrance thereon, the proceedings of sale shall be applied in the
following way:

Firstly, in defraying the expenses of the sale;

Secondly, in discharging the amount due under the decree;

Thirdly, in discharging the interest and principal money due on subsequent incumbrances (if any); and

Fourthly, rateably among the holders of decrees for the payment of money against the judgment-debtor, who have, prior to the
sale of the property, applied to the court which passed the decree ordering such sale for the execution of such decrees, and have
not obtained satisfaction thereof?”
In M. Jambanna V. K. Honnappa, it was held that the learned judge was wrong in denying the claim to rateable distribution as the
application was filed before the receipt of assets by the Court as required by the rules under Section 73.

In Kotak & Co. V. State of U.P, 1987, it was held by the Supreme Court that the application claiming rateable distribution must
have been made to the Court holding the assets before the assets were received by the Court.

Cost of Realization
The cost of realization of assets by the Court is deducted from the total value of the asset before the decree is executed and the
asset is then distributed to the entitled individuals. The cost is borne by the decree-holder as the process of realization of the asset
is done for the decree-holder or the individual entitled to the asset.

Mode of Distribution
The distribution of rateable assets is done by sale if two or more parties are involved. A property entitled to two individuals is sold
by the Court and the cost of realization is deducted from the total sale value of the property. The remaining amount is then divided
between the two parties based on the share they are entitled to and distributed.