Case Note & Summary
The case involves four connected civil appeals arising from a common judgment of the High Court of Punjab & Haryana dated 09.09.2022, which dismissed four revision petitions filed by the defendants (judgment debtors) against orders of the executing court. The executing court had permitted the plaintiffs (decree holders) to deposit the balance sale consideration and rejected the defendants' application under Section 28 of the Specific Relief Act, 1963 for rescission of the contract. The background is that four suits for specific performance of agreements to sell were decreed by the trial court on 16.08.1994, with conditional decrees requiring the plaintiffs to deposit the balance sale consideration within 20 days and the defendants to execute sale deeds by 15.09.1994. The defendants appealed, and the first appellate court reversed the decrees on 24.11.1994. The plaintiffs then filed regular second appeals in the High Court, which were allowed on 03.05.2018 and 24.05.2018, restoring the trial court decrees. The decree sheets were prepared on 31.05.2018. The plaintiffs filed execution petitions on 04.09.2018 and simultaneously applied to deposit the balance sale consideration, which was permitted by the executing court on 07.09.2018, and the amount was deposited the same day. Meanwhile, the defendants had filed SLPs before the Supreme Court, which were dismissed on 18.01.2019. On 04.04.2019, the defendants applied under Section 28 for rescission, which was rejected by the executing court on 16.08.2019. The High Court upheld these orders. The Supreme Court framed two issues: the effect of merger of the trial court decree with the High Court decree, and whether the defendants could seek rescission for non-deposit within 20 days. The Court held that the doctrine of merger applies, and since the High Court did not fix any time for deposit in its decree, the 20-day period from the trial court decree did not revive. The executing court had discretion under Section 28 to extend time, and the plaintiffs' deposit within four months of the High Court decree, with no willful default, was justified. The Court also noted that the sale deeds had already been executed in 2019 and possession handed over in 2022, rendering the appeals infructuous. The appeals were dismissed.
Headnote
A) Specific Relief Act - Section 28 - Rescission of Contract - Extension of Time - Doctrine of Merger - When a decree for specific performance is restored by the appellate court without fixing any time for deposit, the original time limit does not revive; the executing court has discretion to extend time under Section 28. The court held that the decree holder's deposit within four months of the appellate decree, coupled with immediate filing of execution and deposit application, did not constitute unreasonable delay or willful default. (Paras 23-25) B) Specific Relief Act - Section 28 - Rescission of Contract - Executing Court's Discretion - The court held that the executing court may extend the period for deposit under Section 28(1) based on the conduct of the parties and the circumstances of the case. The judgment debtors' application for rescission was rightly rejected as the decree holder had deposited the amount before the application was decided. (Paras 24-25) C) Civil Procedure - Doctrine of Merger - When an appellate court restores a trial court decree without modifying the time for deposit, the appellate decree supersedes the trial court decree, and the time limit in the trial court decree does not automatically revive. The High Court's decree in second appeal did not fix any period for deposit, so the 20-day period from the trial court decree was not applicable. (Paras 23-25)
Issue of Consideration
Whether the High Court erred in affirming the executing court's order permitting the decree holder to deposit the balance sale consideration beyond the 20-day period stipulated in the original trial court decree, and whether the judgment debtors were entitled to rescission of the contract under Section 28 of the Specific Relief Act, 1963.
Final Decision
The Supreme Court dismissed the appeals, holding that the High Court's decree in second appeal did not fix any time for deposit, and the doctrine of merger meant the original 20-day period did not revive. The executing court rightly exercised its discretion under Section 28 to permit the deposit, and the defendants' application for rescission was correctly rejected. The Court also noted that the sale deeds had been executed and possession handed over, rendering the appeals infructuous.
Law Points
- Section 28 Specific Relief Act
- 1963
- Doctrine of Merger
- Extension of time for deposit
- Rescission of contract
- Conditional decree
- Executing court's discretion
