Case Note & Summary
This special leave petition arose from the judgment of the learned Single Judge of the Madhya Pradesh High Court dated October 4, 1996 in Civil Revision No. 394/96. The dispute concerned a contract for sale of agricultural land. The petitioner had entered into a contract with the respondent for sale of agricultural land in Khasra No. 52, 61, 73, 74, 79, admeasuring 3-533, 0-166, 1-437, 0.384, 0.202 hectares, under an agreement to sell dated July 7, 1977 in respect of land situated in Village Khode, for a consideration of Rs. 25,000. The respondent failed to perform his part of the contract. The petitioner filed Civil Suit No. 9A/78 in the Court of ADJ, Mandleshwar. The Trial Court granted a decree for specific performance on November 18, 1987 directing the respondent to refund the earnest money of Rs. 15,000 and damages quantified at Rs. 2,000, as agreed in the contract, within three months, and in default to execute the sale deed. Subsequently, the respondent filed applications to rescind the decree in execution and sought extension of time for compliance. The executing Court by order dated March 15, 1996 allowed both applications and directed the respondent to deposit the amount within three days. In revision, the High Court upheld the executing court's order and additionally directed the respondent to deposit a further sum of Rs. 16,000 to compensate the petitioner for loss of enjoyment of money. The petitioner challenged these orders before the Supreme Court. The core legal issues were whether the executing court and High Court had jurisdiction to extend time for compliance with the conditional decree despite the inordinate delay of 7.5 years and the absence of proper explanation, and whether the court could treat the decree as a preliminary decree. The petitioner's counsel argued that the delay was inordinate and unexplained, that the High Court erred in treating the decree as preliminary, and that the court had no power to extend time. The Supreme Court found no force in these contentions. It referred to Section 28(1) of the Specific Relief Act, 1963, which gives the judgment-debtor the right to apply to rescind the contract and provides that the court may allow 'such further period' as it may allow. The Court held that the court does not lose its jurisdiction after the grant of a decree for specific performance nor becomes functus officio, and that till the sale deed is executed in execution of the decree, the trial court retains power and jurisdiction to deal with the decree. It further held that the court has power to enlarge time in favour of the judgment-debtor to pay the amount or perform the conditions mentioned in the decree, even if an application for rescission has been filed and rejected. Extension of time is discretionary and is not akin to an application for condonation of delay under Section 5 of the Limitation Act. The executing court and High Court had exercised discretion and extended time, and the High Court had rightly enhanced compensation by Rs. 16,000, as the parties had contracted for non-performance and quantified damages. Accordingly, the Supreme Court dismissed the special leave petition after condoning the delay.
Headnote
A) Specific Relief - Extension of Time for Conditional Decree - Section 28(1), Specific Relief Act, 1963 - Court retains jurisdiction after decree for specific performance and may extend time for payment of purchase money or other sums despite judgment-debtor's delay and absence of satisfactory explanation; furnishing additional compensation to decree-holder is permissible. The petitioner sought specific performance, obtained a conditional decree requiring refund of earnest money and damages within three months, failing which sale deed to be executed. Respondent applied for rescission and extension after 7.5 years; executing court allowed extension and High Court added Rs 16,000 compensation. Supreme Court dismissed special leave petition, holding that Section 28 itself contemplates further period as court may allow, court does not become functus officio, and extension of time is discretionary and not governed by Section 5 Limitation Act. Held: extension and enhanced compensation were valid (Paras 1-2).
Issue of Consideration
Whether executing court and High Court erred in extending time for compliance with conditional decree under Section 28 of Specific Relief Act, 1963 despite 7.5 years delay and no proper explanation; whether court has power to extend time after grant of decree for specific performance
Final Decision
Delay condoned. Special leave petition dismissed. Supreme Court upheld the High Court order confirming the executing court's extension of time and additional compensation of Rs 16,000. Held that court has power under Section 28(1) of Specific Relief Act, 1963 to extend time and does not become functus officio; discretion exercised properly.
Law Points
- Section 28(1) of Specific Relief Act
- 1963 gives judgment-debtor right to apply for rescission of contract
- court does not lose jurisdiction after decree for specific performance nor becomes functus officio
- court retains power to deal with decree till sale deed executed
- court has discretion to extend time for compliance of conditional decree even if rescission application rejected
- extension of time under Section 28 is not akin to Section 5 Limitation Act condonation of delay
- absence of satisfactory explanation for delay does not bar extension
- enhanced compensation for loss of enjoyment of money upheld
