Specific Relief Act, 1963 — Section 28 — Specific Performance — Execution of Decree — Time Limit for Payment — Doctrine of Merger — Power to Extend Time.
1. Doctrine of Merger: The logic underlying the doctrine of merger is that there cannot be more than one operative decree governing the same subject matter at a given point in time. When a decree of an inferior court is challenged before a superior forum, once the superior court disposes of the lis, it is the decree of the superior court that becomes the final, binding, and operative order. (Paras 9, 12).
2. Section 28 of Specific Relief Act — Power of Court to Extend Time: Section 28(1) empowers the court to extend the time for payment of purchase money even after a decree for specific performance has been passed. The non-payment within the period fixed by the Trial Court does not automatically result in the abandonment or rescission of the contract. The real test is whether the conduct of the plaintiff amounts to a "positive refusal" to complete their part of the contract. (Paras 5, 7, 8).
3. Execution and Hyper-Technicality: An executing court should not adopt a hyper-technical approach. A delay in filing an execution application or depositing balance consideration (e.g., 87 days instead of 60 days) does not render the decree inexecutable, especially when the decree of the Trial Court has merged with the decision of the High Court in the second appeal. (Paras 7, 12, 13).
ANALYSIS OF FACTS
I. Chronology of Events
The dispute involves an agreement to sell property in Panchkula dated 11.12.2004 for Rs. 9,05,000/-.
| Event | Date | Outcome |
| Trial Court Judgment | 14.05.2011 | Suit Decreed; 2 months to pay balance (Rs. 8,05,000). |
| First Appeal | 22.04.2013 | Decree set aside; ordered double earnest money refund. |
| Second Appeal (HC) | 08.02.2016 | HC restored Trial Court's decree for specific performance. |
| Execution Application | 04.07.2016 | Filed 87 days after the HC judgment. |
| Deposit of Balance | Aug & Dec 2016 | Appellant deposited the full balance amount. |
II. The Legal Conflict
The High Court, in the impugned order, accepted the respondent's objections. It held that since the appellant did not deposit the money within the 2-month window mentioned in the original 2011 decree (re-calculated from the 2016 HC order), the decree became inexecutable and the appellant lacked "readiness and willingness."
ANALYSIS OF LAW
1. The Doctrine of Merger
The Supreme Court clarified that when the High Court decided the Second Appeal on 08.02.2016, the Trial Court’s 2011 decree merged into the High Court’s judgment.
At any given time, only one operative decree exists.
Since the High Court restored the Trial Court's decree but did not explicitly set a fresh rigid deadline for the deposit, the 2-month window must be interpreted reasonably, not as a "fatal" deadline that automatically kills the decree.
2. Interpretation of Section 28 (Specific Relief Act)
The Court emphasized that Section 28 is a provision intended to provide relief to both parties.
For the Vendor: They can apply to rescind the contract if the buyer defaults.
For the Purchaser: The court can extend the time for payment.
The Supreme Court held that the High Court erred by assuming that the time limit was "automatic." Unless the vendor moves a formal application to rescind the contract and the court finds a "positive refusal" by the buyer, the decree remains valid.
3. Eschewing Hyper-Technicality
The Court noted that the delay was merely 27 days (87 days total minus the 60-day window). In the context of a litigation spanning nearly two decades (2004–2025), such a minor delay does not outweigh the substantive right to specific performance, especially when "readiness and willingness" had already been established on merits.
FINAL DECISION
The Supreme Court allowed the appeal, set aside the High Court's judgment, and restored the Executing Court's order. The Execution Petition is to proceed so that the sale deed can be executed in favor of the appellant.
Specific Relief Act, 1963 — Section 28 — Specific Performance — Execution of Decree — Mere Delay — Doctrine of Merger — Positive Refusal Test.
1. Mere Delay vs. Abandonment of Contract: The non-payment of balance sale consideration within the specific time period fixed by the Trial Court does not, by itself, amount to abandonment or rescission of the contract. The real test for the Court is to determine if the conduct of the plaintiff/decree-holder constitutes a "positive refusal" to complete their part of the contract. (Paras 7, 8)
2. Power to Extend Time (Section 28): Section 28(1) empowers the court to extend the time for payment even after the decree is passed. A hyper-technical approach that treats a minor delay as fatal to the decree must be eschewed. In this case, a delay of 27 days (filing on the 87th day instead of the 60th) was held not to strike at the "heart of the agreement." (Paras 7, 12)
3. Doctrine of Merger: When a higher forum (High Court) entertains an appeal on merits and restores a Trial Court's decree, the original decree merges into the final decision of the High Court. If the superior court’s order is silent on a fresh time limit, the strict deadlines of the inferior court’s decree do not automatically survive in a manner that renders the decree inexecutable. (Paras 9, 12)
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