Section 89 of The Punjab Land-Revenue Act, 1887 — Procedure in default of payment

Bare section text

Official Legislative Text

In default of payment of the full amount of the purchasemoney within the period mentioned in the last foregoing section, the deposit referred to in section 85 or section 87, as the case may be, shall, after defraying the expenses of the sale, be forfeited to the Government and may, if the Collector, with the previous sanction of the Commissioner, so directs, be applied in reduction of the arrear, and the property shall be re-sold, and the defaulting purchaser shall have no claim to the property or to any part of the sum for which it may subsequently be sold.

Educational Study Layer

Summary

This section outlines the severe penalties if an auction buyer fails to pay the full property price on time.
The government seizes the buyer's initial deposit, first using it to pay for the expenses of running the auction.
The Collector can use the leftover deposit money to pay down the original landowner's debt, but only if the Commissioner approves.
The property is immediately scheduled to be sold again at a new auction.
The buyer who missed the payment loses all rights to the property and cannot claim any money from the second sale.

Practical examples

1Ramesh wins a land auction and pays a deposit but misses his 15-day payment deadline. The government keeps his deposit to cover the auction costs, and puts the land back up for public sale the following month. Ramesh has no right to bid or claim the land anymore.

2After a buyer defaults, the Collector looks at the remaining forfeited deposit money. Wanting to clear the original property tax debt, the Collector writes to the Commissioner for permission to apply those funds to the arrears before auctioning the property a second time.

FAQ

1. What happens to my initial deposit if I fail to pay the balance under Section 89 of The Punjab Land-Revenue Act, 1887?

Under Section 89 of The Punjab Land-Revenue Act, 1887, your deposit is forfeited to the Government after the expenses of the sale are deducted.

2. If I default on a payment, can I get a refund if the property sells for more money later, according to Section 89 of the Act?

No, Section 89 of The Punjab Land-Revenue Act, 1887 specifically states that a defaulting purchaser has no claim to any part of the sum for which the property may subsequently be sold.

3. Under Section 89 of the Punjab revenue law, who gives permission to use a forfeited deposit to pay off the original land debt?

The Collector directs this action, but must obtain the previous sanction of the Commissioner, according to Section 89 of The Punjab Land-Revenue Act, 1887.

Practice Quiz

Q1.Under Section 89 of The Punjab Land-Revenue Act, 1887, what is the very first thing paid for using a defaulting purchaser's forfeited deposit?

Q2.If a purchaser defaults under the rules of Section 88, what does Section 89 of The Punjab Land-Revenue Act, 1887 require the government to do with the property?

Q3.Whose specific approval must the Collector obtain under Section 89 of The Punjab Land-Revenue Act, 1887 to apply a forfeited deposit toward the property's arrears?

Q4.Under Section 89 of The Punjab Land-Revenue Act, 1887, what claim does the defaulting purchaser have on the property after failing to pay?

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