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Drafting Pleading

Sale Deed

A sale deed is a legal document that the buyer and seller sign in order to finalize the deal when buying a property. The title of ownership of the property has been transferred from the seller to the buyer in a selling deed. The buyer or transferee and the seller might be referred to as the parties. In most cases, the parties agree to the terms and conditions before signing the sale deed. The terms of the property and the parties’ rights and obligations are detailed in the sale deed, which serves as evidence of the transfer of ownership.

Parties Involved in the Sale Deed

In the sale deed, there are two Parties, who are called seller and buyer. The seller, also called transferor, transfers the ownership of the property and the buyer, also called transferee, gets the ownership of the property. Any competent person, person, or business is permitted by law to participate in the transfer of any property.

Definition:

Sale deed is defined under Section 54 of the Transfer of Property Act, 1882 as; ā€œSaleā€ is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised

A deed isĀ a signed legal document that transfers ownership of an asset to a new owner. Deeds are most commonly used to transfer ownership of property or vehicles between two parties. The purpose of a deed is to transfer a title, the legal ownership of a property or asset, from one person or company to another.

Objective of sale deed?

A sale deed is a written formal document thatĀ allows the owner of a property to transfer the whole of their rights in the property to another in exchange for a consideration. A sale deed is the final document that is required to transfer the right of ownership in a property.

Elements of a Sale Deed

When creating the sale deed draft, several essential components are included in the document. Following are the things that must be a part of the sale deed draft. 

  1. Details of Both the Parties: Details in terms of the name of both parties, contact numbers, and age are recorded in the sale deed draft. 
  2. Property Details: This section includes the property’s details, such as its complete address, area of the property, including the dimensions, details of construction. 
  3. Indemnity Clause: This particular clause is added to the property to ensure that the seller frees the buyers from all the previous taxes, loans, and charges related to the property. Also, the seller will pay up any mortgages and loans before finalizing the sale of the property. 
  4. Payment Details: The price at which the owner will sell the said property should be specified in the sale deed. Along with the sale price of the property, the information related to the advance payment made by the buyer must be stated clearly in the sale deed. Information on the amount paid in instalments, date of each instalment should also be mentioned in the document. 
  5. Mode of payment: The method of payment, i.e., how the amount will be made for the property purchase, must be recorded explicitly in the sale deed. The standard modes of payment, such as bank transfer, cheque, and cash, are clearly stated in the sale deed. 
  6. Possession of Property: The sale deed will record the date the buyer will get possession of the property. 
  7. Witnesses of the Property: The testimonium clause of the property includes that two witnesses are mandatory for attending the sale deed. At least one witness from both sides, i.e., buyer and seller, should sign the sale deed. The witness has to share their complete name, address, and age. 

In addition, the seller of the property must also make some mandatory disclosures to the buyer in the sale deed. These disclosures include defects in the property related to material, declaration of disputes, if any, execution of conveyance of property correctly, and clearance of taxes and other charges related to the property, among others. Considering that the sale deed includes all the rights and the obligations of both parties in detail, its implementation reduces the risk for both parties. 

Difference Between Sale Deed and Sale Agreement

Following are the significant differences between the sale agreement and the sale deed.

Sale DeedSale Agreement
A sale deed is a document that refers to the immediate and complete sale of the property. A sale agreement is a document that indicates the sale of the property sometime in the future.
Under the sale deed, any risk borne or associated with the property is the responsibility of the buyer. Until the sale of the property, the responsibility of bearing the risk is taken care of by the seller.
A sale deed is a contract that has been executed. A sale agreement is a contract that is yet to be executed in the future.
It is mandatory to register a sale deed. Also, during the registration process, the buyer is liable to pay the stamp duty. Based on the rules of state related to the sale agreement, it may or may not be registered.
Under the sale deed, the rights and claims of the property are handed over to the new owner.The sale agreement only gives the person the right to purchase a property in the future. 
The sale deed includes information related to both the parties involved, property and payment details, along with other information. The sale of the agreement only includes terms and conditions based on which the sale of the property will be executed.

Getting a Certified Copy of Sale Deed

The sale deed should be maintained by the property owner with the utmost care now that it has been established that it is of the utmost importance. However, if the owner of the property misplaces the sale deed at any moment, they must report it to the local police station.

After filing the complaint (FIR) at the police station, a non-traceable certificate is issued to the property owner. Post the issuance of the non-traceable certificate, publish an advertisement in the newspaper about the loss of sale deed. The ad must include essential details. As the next step, you need to file an affidavit and the application to the sub-registrar office to get a certified copy of the sale deed. 

A copy of the FIR, a certificate that cannot be traced, an advertisement, and information on the property must all be attached to the affidavit, which must also be notarized. Additionally, a signed undertaking confirming the veracity of the information supplied must be included to the affidavit. A specified fee must also be paid in order to get a certified copy of the sale deed. After the procedure is finished, a certified copy of the selling deed will be given out within two to four weeks.

What is the Sale Deed Number?

After the document is registered, the stamp duty is paid, and the registration fees are paid, the Sale Deed Number is generated. The payment slip contains the number for the sale document. On top right of every page of the full selling deed paperwork, it is also mentioned..

Format of the sale deed number: Document Number/Year/Sub Registrar Office initials

Sale Deed Documents Required for Property Registration

Here are a few major sale deed documents required for property registration.

  • Sale Agreement
  • Title Deed Draft
  • Extract
  • Sharing Agreement signed by the builder and property owner
  • Allotment Letter from the Housing Board
  • Power of Attorney, if any
  • No-Objection Certificate, in case of property resale
  • Blueprint of the authorised parties
  • Completion Certificate
  • Property Tax Receipts
  • Encumbrance Certificate
  • Stamp Duty Receipt
  • Identity proof of all the parties and witnesses involved
  • Possession Letter
  • Property Papers from the bank, in case a loan has been taken against the property
  • Occupancy Certificate
  • Passport-size photographs

Is It Possible to Cancel a Sale Deed?

The cancellation of the selling deed is equivalent to the loss of the right to purchase a property. It can only be canceled in certain circumstances, though. One of the parties involved in a selling deed may cancel it if they are not happy with the terms of the agreement. The alleged party must consent to the complaint of discontent in a court of law. A valid reason must also exist for one of the parties’ desire to revoke the sale deed. Once the cause has been proven, the petitioner must obtain a civil court order and deliver it to the registrar in order to have the sale deed revoked. Sections 31 and 33 of the Special Relief Act of 1963 allow for the cancellation of the sale deed.

A sale deed can be cancelled for the following reasons:Ā 

  • The deed was created under undue influence
  • The deed is void if a minor has executed it 
  • Fraudulent activity in the creation of the deed or transfer and transaction
  • Misinterpretation of facts to get a deed signed
  • If the execution of the sale deed can cause harm or injury to the petitioner. 

What to Keep in Mind When Executing a Sale Deed

Here are a few major things to remember when executing a sale deed.

  • The sale deed must include a clause that transfers ownership rights to the buyer once the purchase is complete.
  • TheĀ titleĀ of the property must be free of all encumbrances.
  • The registrarā€™s office must verify the encumbrance status.
  • All utility bills including water bills, electricity bills, property tax, etc. related to the property must be paid.
  • There must be no further dues such as maintenance charges, pending.
  • A sale deed must specify all terms and conditions under which the property has been sold.

Conclusion

An important document that proves property title is a sale deed. The sale document also contains information about the property, the buyer and seller, the price, and other items. Stamp duty for recording the sale deed is paid by the purchaser. The property owner is responsible for keeping the sale deed up to date. It takes time to obtain a certified copy of the sale deed from the sub-registrar office if the original sale deed is lost. If there is a disagreement, the registered sale deed may be contested because at least one representative from each party must sign it.

Sample format of Sale Deed

DEED OF ABSOLUTE SALE

This DEED OF ABSOLUTE SALE is made and executed on this _______ day of ______________, Two Thousand _______

BETWEEN

Sri ____________________, son/wife/daughter of Sri/Late _______________, aged about _______ years, holding PAN _____________, by Caste ________, by Nationality Indian, residing at _____________________________________________,                                                                                                     hereinafter called the “SELLER” (which expression shall mean and include his legal heirs, successors, successors-in-interest, executors, administrators, legal representatives and assigns) of the ONE PART.

AND

Sri __________________________________, son of  _______________________,                                aged about _______ years, by Caste __________, by Nationality Indian,  holding PAN _____________, residing at _____________________________________________,                                                                                                        hereinafter called the “PURCHASER” (which expression shall mean and include his legal heirs, successors, successors-in-interest, executors, administrators, legal representatives and assigns) of the  OTHER PART.

The  SELLER and the PURCHASER are hereinafter referred collectively as parties and individually as party.

WHEREAS the SELLER is the absolute owner, in possession and enjoyment of the piece and parcel of ______ land measuring about ____ decimal, lying and situated in R.S. Plot Number ____, corresponding L.R. Plot Number ____, Recorded in R.S. Khatian Number _____ and L.R. Khatian Number ____, at Mouza _____, J.L. Number _____, Touzi Number ______, under Police Station __________, Registration Sub-District _________, in the district of ________________, more fully and particularly described in the schedule here under written and hereafter referred to as the “SCHEDULE PROPERTYā€.

ANDWHEREAS the SCHEDULE PROPERTY was the self acquired property of  __________, deceased father of the SELLER and he purchased the same from Sri __________________, son of _____________ of _________________________________, by virtue of a Sale Deed dated ________________, registered in the office of the _____________________________, in Book 1,  Volume No. ____, Pages ____ to _____, Being Number ___________ for the Year _____.

ANDWHEREAS the said _________ died in-estate on _________ leaving behind his only son namely, Sri _______________, the SELLER herein, as the only legal heir.

ANDWHEREAS the SELLER herein, as the only legal heirs of the deceased ____________, have become the absolute owner of the SCHEDULE PROPERTY since the death of his father _____________ on and he has been enjoying the same with absolute right, title and interest sice then and he has clear and marketable title to the SCHEDULE PROPERTY.

ANDWHEREAS the SELLER being in need of funds to meet his personal commitments and family expenses have decided to sell the SCHEDULE PROPERTY and the PURCHASER has agreed to purchase the same.

ANDWHEREAS the SELLER agreed to sell, convey and transfer the SCHEDULE PROPERTY to the PURCHASER for a total consideration of  Rs._________ (Rupees                        ___________________________) only and the PURCHASER herein agreed to purchase the same for the aforesaid consideration and to that effect the parties entered into an agreement on the _________________ .

NOW THIS DEED OF SALE WITNESSETH:

  1. THAT in pursuance of the aforesaid agreement and in consideration of a sum of Rs._________ (Rupees                        ___________________________) only received by the SELLER in cash/cheque/bankdraft and upon receipt of the said entire consideration of Rs._________ (Rupees                        ___________________________) only (the SELLERdoth hereby admit, acknowledge, acquit, release and discharge the PURCHASER from making further payment thereof) the SELLER doth hereby sells, conveys, transfers, and assigns unto and to the use of the PURCHASER the SCHEDULE PROPERTY together with the water ways, easements, advantages and appurtenances, and all estate, rights, title and interest of the SELLER to and upon the SCHEDULE PROPERTY TO HAVE AND TO HOLD the SCHEDULE PROPERTY hereby conveyed unto the PURCHASER absolutely and forever.
  2. THAT THE SELLER DOTH HEREBY COVENANT WITH THE PURCHASERAS FOLLOWS:
    1. That the SCHEDULE PROPERTY shall be quietly and peacefully entered into and held and enjoyed by the PURCHASER without any interference, interruption, or disturbance from the SELLERor any person claiming through or under him.
    1. That the SELLERhave absolute  right, title and full power to sell, convey and transfer unto the PURCHASER by way of absolute sale and that the SELLERhave not done anything or knowingly suffered anything whereby their right and power to sell and convey the SCHEDULE PROPERTY to the PURCHASER is diminished.
    1. That the property is not subjected to any encumbrances, mortgages, charges, lien, attachments, claim, demand, acquisition proceedings by Government or any kind whatsoever and should thereby and the SELLER shall discharge the same from and out of his own fund and keep the PURCHASER indemnified.
    1. That the SELLER hereby declares with the PURCHASER that the SELLER have paid all the taxes, rates and other outgoings due to local bodies, revenue, urban and other authorities in respect of the SCHEDULE PROPERTY up to the date of execution of this sale deed and the PURCHASER shall bear and pay the same hereafter.  If any arrears are found due for the earlier period, the same shall be discharged/borne by the SELLER.
    1. That the SELLERhave handed over the vacant possession of the SCHEDULE PROPERTY to the PURCHASER on  ___________ and delivered the connected original title document in respect of the SCHEDULE PROPERTY hereby conveyed on the date of execution of these presents.
    1. That theSELLERwill at all times and at the cost of the PURCHASERexecute, register or cause to be done, all such acts and deeds for perfecting the title to the PURCHASER in the property hereby sold and conveyed herein.
    1. That the SELLER do hereby covenants and assures that the PURCHASER is entitled to have mutation of his name in all public records, local body and also obtain all documents in the name of the PURCHASERand undertakes to execute any deed in this respect.

SCHEDULE  OF PROPERTY

All that piece and parcel of _____ land measuring about _____ decimal, lying and situated in R.S. Plot Number ____, corresponding L.R. plot Number ____, Recorded in R.S. Khatian Number ____ and L.R. Khatian Number ____, at Mouza _____, J.L. Number ____, Touzi Number _______, under Police Station ______, Registration Sub-District ______, in the district of ____________, butted and bounded by:

On the North   :

On the South   :

On the East     :

On the West    :

             IN WITNESS WHEREOF the SELLER and the PURCHASER have set their signatures on the day month and year first above written.

                                                            ______________________________           

                                                                                  SELLER

                                                            ______________________________

                                                                                PURCHASER

WITNESSES:

1.

2.

WRITTEN STATEMENT

 Actually, it is a pleading of the defendant in the answer of the plaintiff led by the plaint against him. It is a reply statement of the defendant in a suit specifically denying the allegations made against him by the plaintiff in his plaint. The provision regarding the written statement has been provided in the Code of Civil Procedure, 1908.

Who may be written statement:

A written statement may be filed by the defendant or by his duly authorized agent. In the case of more than one defendant, the common written statement led by them must be signed by all of them. But it is succinct if it is verified by one of them who is aware of the facts of the case and is in a position to lead an affidavit. But a written statement led by one defendant does not bind other defendants.

The time limit for written statements:

A written statement should be made within thirty days from the service of the summons on him. The said period, however, can be extended up to ninety days,(Rule -1). A defendant should present a written statement of his defense in the said period.

Particulars: Rules 1-5 and 7-10

 Before proceeding to draft a written statement it is absolutely necessary for the defendant to examine the plant carefully.

New facts, such as the suit is not maintainable, or that the transaction is either void or voidable in law, and all such grounds of defense, if not raised, would take the plaintiff by surprise, or would raise issues of fact not arising out of the plaint, such as fraud, limitation, release, payment, performance or facts showing illegality, etc. must be raised. (Order 8 Rule 2)

It is not succinct for a defendant in his written statement to generally deny the grounds alleged by the plaintiff, but he must deal especially with each allegation of fact which he does not admit, except for damages

. The denial should not be vague or evasive. Where a defendant wants to deny any allegation of fact in the plaint, he must do so clearly, especially and explicitly, and not evasively or generally

Where the defendant relies upon several distinct grounds of defense or set-o or counterclaim founded upon separate and distinct facts, they should be stated separately and distinctly.

Any new ground of defense which has arisen after the institution of the suit is a presentation of a written statement claiming a set-o or counterclaim may be raised by the defendant or plaintiff in his written statement as the case may be

.If the defendant fails to present his written statement within the time permitted or relaxed by the court, the court will pronounce the judgment against him or pass such order in relation to the suit as it thinks it, and a decree will be drawn up according to the said judgment.

Interlocutory application (I.A)

An interlocutory application is an application that is moved in the main petition. it is usually filed when you ask for some urgent relief or to bring certain new facts to the knowledge of the court

ā€œInterlocutory applicationā€ means an application to the Court in any suit, appeal, or proceeding already instituted in such Court, other than a proceeding for execution of a decree or order. The orders which are passed in those applications are called interlocutory orders.

ā€˜interlocutoryā€™ as order other than a final decision. Once an auction has been commenced all subsequent applications are referred to as interlocutory applications.

The provision dealing with the incidental proceedings is contained under part III Of the code of civil procedure. But such applications are moved under various provisions of the Code of civil procedure, 1908 which include applications for appointment of Commissioner, Temporary Injunctions, Receivers, payment into court, security for cause, etc.

Sec 141 of CPC provides, that the procedure provided in the Code of Civil Procedure, in regard to the suit shall be followed, as far as it can be made applicable, in all proceedings in any court of civil jurisdiction, therefore the procedure with regard to such applications is the same as that of the original suit, in matters like a recording of evidence, examining witnesses, etc.

Interlocutory orders

Interlocutory orders are passed by the courts to prevent irreparable harm from occurring to a person or property during the pendency of a lawsuit or proceeding.

Rules 6 to 10 of Order 39 mention certain interlocutory orders, which include the courtā€™s power to order the interim sale of movable property, and to order the detention, preservation, or inspection of any property which is the subject matter of such a suit. Similarly, when the land in the suit is liable to Government revenue or is tenure liable to the sale and the party in possession neglects to pay the revenue or rent, the court may order any other party to the suit in case of sale of the land to be put in immediate possession of the property.

In the course of the trial, a trial Judge may pass a number of orders whereby some of the various steps to be taken by the parties in the prosecution of the suit may be of a routine nature while other orders may cause some inconvenience to one party or the other, e.g., an order refusing an adjournment, an order refusing to summon an additional witness or documents, an order refusing to condone the delay in filing documents, after the first date of hearing order of costs to one of the parties for its default or an order exercising discretion in respect of a procedural matter against one party or the other.

ā€œSuch orders are purely interlocutory and cannot constitute judgments because it will always be open to the aggrieved party to make a grievance of the order passed against the party concerned in the appeal against the final judgment passed by the Trial Judge.ā€

What is the difference between interim order and interlocutory order?

While an interlocutory injunction is normally enforceable until the determination of the action, an interim injunction is generally granted for a short, specific period of time, and the plaintiff needs to return to court at the end of the period to ask for the continuance of the injunction. .. Court orders are a declaration made by a judge, commanding something to be done, or prohibiting the certain activity. Interlocutory applications can seek a wide range of orders, such as: 

  • urgent assistance from the court; or 
  • orders about the procedure or timetable of the court proceedings,  including orders about obtaining or disclosing evidence.

What is an interlocutory hearing?

An interlocutory hearing is held if a party does not consent to the orders sought by an interlocutory application. The hearing allows for both sides to present their arguments so that the judge can make a decision. 

Types of Interlocutory Applications 

There is a wide variety of types of interlocutory applications. Common types include:

Injunctive Relief   

Orders that stop the other party from doing something, like terminating a contract or completing a sale purchase. They are usually urgent, requiring the orders by a certain deadline.

Particulars

Orders to compel a party to provide particulars (details) that the other party has requested, seeking clarification of information in legal documents, including a statement of claim or defense.

Discovery

Orders to compel a party to provide certain documents sought by the other party through the discovery process. Therefore, an interlocutory application seeks orders that the documents should be discovered.

subpoenas

Subpoenas are orders to determine whether a party can ask a third party to provide certain documents. As above, the other party may object to documents sought by the other party because they are not relevant to the proceedings.

Interrogatories

Orders to compel the other party to answer certain questions are required to determine a position on a matter in dispute. The questions must be necessary to help provide a fair trial.

Medical Examination

Orders that one party submit to a medical examination. For example, this may be sought where the other party has concerns about the medical condition of that party and how it may impact the matters in dispute.

Interlocutory applications, and hearings, are an important part of court proceedings. Above all, they allow the parties to correct any unjust behavior by the other party and keep the proceedings in line with the courtā€™s timetable. They can add significant time and expense to a court proceeding.

COUNTER CLAIM

Rule 6A to 6G of Order 8 deals with counter-claim. It is a claim made by the defendant in a suit against the plaintiff. It is a claim independent of and separable from the plaintiff’s claim which can be enforced by a cross-section. Counter-claim can be set up in respect of action accruing to the defendant either before or after the filing of the suit but before the defendant has delivered his defense or before the time fixed for the delivery of his defense has expired.

Such a claim should not exceed the pecuniary limits of the jurisdiction of the concerned court. The counterclaim is to be treated as a plain and the plaintiff can file a written statement in answer to it. Counter-claim can be filed after the filing of a written statement.

Who may file a counterclaim?

Normally, it is the defendant who may file a counterclaim against the plaintiff. But incidentally and along with the plaintiff, the defendant may also claim relief against the co-defendants in the suit. 

When counterclaim may be set up?

A counterclaim may be set up by a defendant against a plaintiff in respect of the cause of action accruing either before or after filing of the suit, provided such claim is not barred by limitation.

Effect of counterclaim: Such counterclaim has the effect of a cross-suit and the court can pronounce a final judgment both on the original claim and the counterclaim. The counterclaim of the defendant will be treated as a plaint and the plaintiff has a right to file a written statement in answer to the counterclaim of the defendant.

The effect of the counterclaim is that even if the suit of the plaintiff is stayed, discontinued, dismissed, or withdrawn, the counterclaim will be decided on merits and the defendant will have a right to get a decree for a counterclaim as claimed in the written statement. If the plaintiff does not file any reply to the counterclaim made by the defendant, the court may pronounce the judgment against the plaintiff in relation to the counterclaim made against him or make such order in relation to the counterclaim as it thinks fit.268 The counterclaim shall be treated as a plaint and will be governed by the rules applicable to plaints. Similarly, a reply filed in answer to a counterclaim shall be treated as a written statement and governed by rules applicable to written statements.

Set Off & Counter Claim

The distinction between set-off and counter-claim.

  • Set-off is a statutory defense to a plaintiff’s action, whereas a counterclaim is substantially a cross-action.
     
  • Set-off must be for an ascertained sum or must arise out of the same transaction as the plaintiff’s claim. A counterclaim need not arise out of the same transaction.
     
  • Set-off is a statutory ground of defense and has to be pleaded in the written statement. It can be used as a shield and not as a sword. Counterclaim, on the other hand, does not afford any defense to the plaintiff’s claim. It is a weapon of offense that enables the defendant to enforce his claim against the plaintiff as effectively as in an independent action. It is a sort of cross-action.
     
  • If the statute of limitation is pleaded to a defense of set-off, the plaintiff in order to establish his plea has to prove that set-off was barred when the plaintiff commenced the action. It is not enough to prove that it was barred at the time when it was pleaded. In the case of a counterclaim, it is enough for the plaintiff to prove that the counterclaim was barred when it was pleaded.
     
  • An equitable set-off is a claim by the defendant in defense, which generally cannot exceed the plaintiff’s claim. A counter-claim the defendant may, however, exceed the plaintiff’s claim, being in the nature of the cross action. Under the provision rule 6-F of Order 6, if in any suit a set-off or counterclaim is established as a defense against the plaintiff’s claim and any balance is found due to the defendant as the case may be the court may give judgment to the party entitled to such balance.

Set off (Order VIII, Rule 6)

Definition:

Where in a suit by the plaintiff for recovery of money and the defendant finds that he also has a claim of some amount against the plaintiff what he does is he can claim a set-off in respect of the said amount. This right of the defendant to claim set-off has been recognized under Order 8, Rule 6 of the Code.

Essential Conditions:

  1. A defendant may claim a set-off, if:
  2. The suit is for the Recovery of money;
  3. The sum of money must be ascertained;
  4. Such sum must be legally recoverable;
  5. It must be recoverable by the defendant or by all the defendants, if not more than one;
  6. It must be recoverable by the defendant from the plaintiff(s);
  7. It must not exceed the pecuniary jurisdiction of the court in which the suit is brought;
  8. Both the parties must fill in the defendant’s claim to set-off, off the same character as they fill in the plaintiff’s

Effects:

When a defendant claims set-off, he is put in the position of the plaintiff as regards the amount claimed by him. Where the plaintiff doesn’t appear and his suit is dismissed or he withdraws, it does not affect the claim for set-off by the defendant and a decree may be passed in his favor if he is able to prove his claim.

Types of Set-Off

Set-off is of two kinds viz., legal set-off and equitable set-off. Rule 6 speaks of legal set-off only. In contrast to legal set-off, an equitable set-off can be claimed for unascertained money but it must arise from the same transaction. For example, where a servant sues his master.

for recovery of the amount of salary, the master can claim set-off for loss sustained by him due to negligence of servant since it arises out of the same relationship.

Legal Set-Off

It is apparent from a reading of the above provisions that in order to constitute legal set-off, the following conditions must be fulfilled, viz.,

  1. The suit must be for the recovery of money.
  2. The defendant must claim an ascertained sum of money. A sum of money due in respect of a disputed transaction cannot constitute an ascertained sum.
  3. That ascertained sum must be legally recoverable from the plaintiff, i.e., it is not barred by the law of limitation.
  4. The plaintiff’s claim and the set-off must be claimed in the same character. The amount must be recoverable by the defendant and if there is more than one defendant, then by all the defendants. Again, the amount must be recoverable by the defendant from the plaintiff and if there is more than one plaintiff, then from all the plaintiffs.
  5. The set-off should be within the pecuniary jurisdiction of the Court.

Equitable set-off

The Court of Equity in England allowed set-off when cross-demands arose out of the same transaction, even if the money claimed by way of set-off was an unascertained sum of money. The Common Law Courts refused to take notice of equitable claims for they were not ascertained sums. The Courts of Equity, however, held that it would be inequitable to drive the defendant to a separate cross-suit and that he might be allowed to plead a set-off though the amount might be unascertained. Such a set-off is called an equitable set-off.

In India, the distinction between legal and equitable set-off remains. The provisions as to legal set-off are contained in Order VIII, Rule 6, C.P.C. The same has now been enlarged by insertion of Rule 6-A with regard to counter-claim by the defendant. So far as equitable set-off is concerned it is provided in Order XX, Rule 19(3), C.P.C., which states that:

The provisions of this rule (relating to a decree for set-off or counter-claim and an appeal therefrom) shall apply whether the set-off is admissible under Rule 6 of Order VIII or otherwise.