DATE: 19/12/2025
COURT: Supreme Court of India
BENCH: Justice Sanjay Karol and Justice
Manoj Misra
FACTS:
The parties entered into an agreement to
sell a plot of land measuring 2 biswas and 10 biswasi in Kalka, District
Panchkula, on December 11, 2004, for a total consideration of Rs. 9,05,000,
with Rs. 1,00,000 paid as earnest money. When the sale did not proceed, the
appellant (buyer) filed a suit for specific performance and permanent
injunction, alternatively seeking recovery of Rs. 2,46,000 with 18% interest.
The Trial Court decreed the suit on May 14, 2011, directing the respondent
(seller) to execute the sale deed upon receipt of the balance Rs. 8,05,000
within two months, failing which the appellant could get it executed through
the court. The First Appellate Court reversed this on April 22, 2013, limiting
relief to recovery of double the earnest money (Rs. 2,00,000), citing lack of
proof of ownership, non-execution by the stipulated date, and absence of a
specific issue on readiness and willingness.
In the Second Appeal, the High Court
restored the Trial Court's decree on February 8, 2016, holding that the time
clause did not bar specific performance and affirming the appellant's readiness
and willingness based on evidence. The appellant filed an execution application
on July 4, 2016, after a delay of 87 days beyond the two-month period. The
respondent objected, claiming the decree was inexecutable due to the delay and
non-deposit of balance consideration. The Executing Court dismissed the objections
on January 20, 2018, but the High Court, in the impugned judgment of August 8,
2022, allowed the objections, dismissing the execution petition on grounds of
non-compliance with the time limit and lack of extension application.
ISSUES:
The primary issues in this case revolved
around whether the two-month time limit imposed by the Trial Court for
executing the sale deed remained enforceable after the High Court's affirmation
in the Second Appeal, and if the doctrine of merger applied to subsume the Trial
Court's decree into the High Court's judgment; whether the execution
application filed beyond this period (after 87 days) rendered the decree
inexecutable without an extension of time under Section 28 of the Specific
Relief Act, 1963; and whether the appellant's delay in filing and depositing
the balance amount demonstrated a lack of readiness and willingness, justifying
rescission of the contract.
JUDGEMENT WITH REASONING:
The Supreme Court allowed the appeal,
setting aside the High Court's impugned judgment of August 8, 2022, and
restoring the Executing Court's order dismissing the respondent's objections.
It directed the Executing Court to proceed with executing the Trial Court's
decree for specific performance, emphasizing that the delay did not amount to
abandonment of the contract.
The Court reasoned that the non-payment of
the balance consideration within the Trial Court's two-month period did not
automatically rescind the contract or render the decree inexecutable, rejecting
a hyper-technical approach. It relied on Section 28 of the Specific Relief Act,
1963, which allows the court to extend time for performance on application, but
clarified that failure to seek extension does not end the transaction if the
buyer's conduct does not indicate refusal to perform. Drawing from precedents
like V.S. Palanichamy Chettiar Firm v. C. Alagappan and Ram Lal v. Jarnail
Singh, the Court held that the real test is whether the plaintiff's actions
amount to abandonment, and here, the appellant's readiness and willingness had
been affirmed by the High Court in the Second Appeal. The delay of 87 days in
filing the execution and subsequent deposits (Rs. 7,39,700 on August 26, 2016,
and Rs. 65,300 on December 13, 2016) were not seen as fatal, as the appellant
had deposited the amounts during execution proceedings, demonstrating intent to
fulfill the contract despite the procedural lapse.
Furthermore, applying the doctrine of
merger, the Court explained that upon the High Court's affirmation in the
Second Appeal, the Trial Court's decree merged into the superior court's
judgment, making only one operative decree subsist. Citing cases like
Kunhayammed v. State of Kerala and Surinder Pal Soni v. Sohan Lal, it noted
that since the High Court did not impose a fresh time limit, the original
two-month period could not be rigidly enforced to dismiss the execution. The
impugned High Court order erred in treating the delay as incurable without an
extension application, especially given the findings on readiness and
willingness. This merger ensured the decree remained executable, and the minor
delay of 27 days (beyond the calculated periods) did not undermine the
agreement's essence, balancing equity with procedural compliance.
ANALYSIS:
This Supreme Court decision in Dr. Amit
Arya v. Kamlesh Kumari (2025) reinforces a pro-enforcement stance in specific
performance decrees under the Specific Relief Act, 1963, prioritizing equitable
justice over rigid procedural timelines. The Court rejected a hyper-technical
interpretation that would render a decree inexecutable due to minor delays in
depositing the balance sale consideration or filing execution proceedings,
provided the decree-holder demonstrates continued readiness and willingness to
perform the contract. By emphasizing that non-compliance with the Trial Court's
two-month deadline does not automatically amount to abandonment or rescission absent
evidence of positive refusal the judgment aligns with evolving jurisprudence
that discourages forfeiture of hard-won decrees on technical grounds,
especially in real estate contracts where property values fluctuate
significantly.
A key highlight is the application of the doctrine
of merger, clarifying that when an appellate court (here, the High Court in
second appeal) affirms the Trial Court's decree without imposing a new time
limit, the original timeline merges into and loses independent enforceability
under the superior decree. This prevents executing courts from treating delayed
compliance as fatal, shifting focus to the decree-holder's overall conduct
rather than isolated lapses. The ruling promotes procedural flexibility under
Section 28 of the Act, balances buyer-seller equities, and serves as a caution
against obstructive tactics by judgment-debtors, ultimately facilitating
smoother execution of long-litigated specific performance awards while
upholding the hierarchical finality of appellate decisions.
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