Realization of Revenue from Malguzars.Central

Section 111 of The Central Provinces Land-Revenue Act, 1881

The proceeds of every sale in execution of any process mentioned in section ninety-four shall be applied, first, in satisfaction of the arrear on account of which the sale was held and of the expenses of such sale; secondly, to the payment of any other arrear due to Government by the defaulter; and the surplus, if any, shall then be payable to him, or, where there are more defaulters than one, to such defaulters according to their respective shares in the property sold.

Summary

This rule establishes the strict order in which the money from a property sale is spent.
The absolute first priority is to pay off the specific debt that caused the sale and to cover the costs of running the auction.
The second priority is to pay off any other outstanding debts the defaulter owes to the Government.
Any leftover money is finally given to the person whose property was sold, or divided based on ownership shares if there are multiple owners.

Practical examples

1A farm is sold for 1000 rupees to cover a 300 rupee debt. 300 goes to the debt, 50 pays for the auction costs, and 200 pays off an old government fine. The original owner gets the remaining 450 rupees.

2Two brothers equally own a plot of land that gets sold for unpaid taxes. After the government takes its share for the debt and sale expenses, the 600 rupees left over is split equally, giving each brother 300 rupees.

FAQ

1. What is the first thing sale proceeds are used for under Section 111 of The Central Provinces Land-Revenue Act, 1881?

According to Section 111 of the Act, the money must first satisfy the arrear that caused the sale and pay the expenses of holding the sale.

2. Does the government collect other debts from the sale money under Section 111 of the 1881 land revenue law?

Yes, Section 111 of the Act states that after the primary debt and sale costs are paid, the money goes to pay any other arrear the defaulter owes to the Government.

3. What happens to leftover money under Section 111 of The Central Provinces Land-Revenue Act?

Under Section 111 of the Act, any surplus money is paid to the defaulter, or divided among multiple defaulters according to their respective shares in the property sold.

Test yourself

Q1.Under Section 111 of The Central Provinces Land-Revenue Act, 1881, what is the very first priority for applying the money from a sale?

Q2.According to Section 111 of the 1881 land revenue law, what happens right after the main arrear and sale expenses are paid?

Q3.Under Section 111 of The Central Provinces Land-Revenue Act, 1881, how is the surplus handled if there are multiple defaulters?

Q4.Which of the following is not mentioned as a use of sale proceeds under Section 111 of The Central Provinces Land-Revenue Act, 1881?

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