Holding

Upon affirmation, the trial court decree merges into the appellate decree, which becomes the sole operative decree, and the decree holder's right to execution cannot be defeated; the High Court exceeded its jurisdiction by substituting the decree with a refund order.

Summary

The appellant sought specific performance of a sale agreement and obtained a decree from the trial court directing the respondent to execute the sale deed within two months of depositing the balance consideration. Both parties appealed; the appellate court affirmed the trial court decree, effecting a merger of the two decrees. The appellant then deposited the balance consideration a month after the appellate decree, but the High Court, on revision, held the decree inexecutable under Section 28 of the Specific Relief Act and ordered a refund of the earnest money. The Supreme Court held that the appellate decree supersedes the trial decree, making it the only enforceable decree, and that the High Court lacked jurisdiction to alter the decree. Consequently, the order dismissing the appellant's execution petition was restored and the appeal was allowed.

Issues considered

The applicability of the doctrine of merger to the trial court decree after affirmation by the appellate court.
Whether Section 28 of the Specific Relief Act renders a decree for specific performance inexecutable due to alleged non‑payment of balance consideration within the stipulated period.
Whether filing an appeal automatically stays execution of a decree under Order 41 Rule 5 of the CPC.
The jurisdiction of a High Court to modify a decree in a civil revision arising from execution proceedings.

Legislation cited

Code of Civil Procedure, 1908s. Order 41 Rule 5, s. Section 148
Specific Relief Act, 1963s. 28

Subjects

specific performancedoctrine of mergerSpecific Relief ActSection 28execution of decreeappellate jurisdictionstay of executionequity

Judgment

1036 [2019] REPORTS
SUPREME COURT 9 S.C.R. 1036 [2019] 9 S.C.R.

A SURINDER PAL SONI
v
SOHAN LAL (D) THRU LRS .
(Civil Appeal No. 5360 of 2019)
B JULY 23, 2019
[DR DHANANJAYA Y. CHANDRACHUD AND
INDIRA BANERJEE, JJ.]
Specific Relief Act, 1963: s.28 – Suit for specific performance
by appellant – Decree in respect of suit land except for land bearing
C
2 karnals – The appellant-decree holder and respondents-judgment
debtors filed appeals challenging the order of trial court – Appellate
court issued notice on the appeal and the application for stay filed
by respondents while the appellant moved for execution of decree –
Objections to the execution of decree filed by the respondents –
D Appellate court dismissed both the appeals – Objections by
respondent were dismissed – Revision petition by respondents – High
Court allowed the revision and directed refund of earnest money in
substitution of the decree of specific performance holding that there
was failure on part of appellant to deposit the balance of the sale
consideration within a period of two months from the date of decree
E
and as a consequence the decree was rendered inexecutable by
virtue of provisions of s.28 of 1963 Act – On appeal, held: The
doctrine of merger is founded on the rationale that there cannot be
more than one operative decree at a given point in time – The said
doctrine applies irrespective of whether the Appellate Court has
F affirmed, modified or reversed the decree of the trial court – Upon
the decision of Appellate Court, there is a merger of the judgment
of trial court with the decision which is rendered in appeal – In the
instant case, once the Appellate Court confirmed the judgment and
decree of the trial court, there was evidently a merger of the judgment
of the trial court with the decision of the Appellate Court – Once
G
the Appellate Court renders its judgment, it is the decree of the
Appellate Court which becomes executable – Hence, the entitlement
of the decree holder to execute the decree of the Appellate Court
cannot be defeated – Appellant-decreeholder had paid the balance

H
1036
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS . 1037

of the sale consideration after the judgment of the Appellate Court A
– Appellant having acted bona fide, the equities must weigh in his
favour – Executing court was justified in rejecting the specious
objections of the respondents – In revision arising out of an execution
proceeding, High Court modified the decree – Such a course was
not open in law – High Court acted in excess of its revisional
B
jurisdiction in substituting decree for specific performance with an
order for refund of the sale consideration, beyond the earnest money
of Rs. 2,00,000/- to the decree holder – In consequence, the order
passed by Executing Court dismissing objections of respondents is
restored.
Allowing the appeal, the Court C

HELD: 1. The doctrine of merger operates as a principle
upon a judgment being rendered by the Appellate Court. In the
present case, once the Appellate Court confirmed the judgment
and decree of the Trial Court, there was evidently a merger of
the judgment of the Trial Court with the decision of the Appellate D
Court. Once the Appellate Court renders its judgment, it is the
decree of the Appellate Court which becomes executable.
[Para 17] [1047-B]
2.1 The High Court held that there was a failure on the
part of the appellant to deposit the balance of the sale E
consideration within a period of two months from the date of the
decree and as a consequence the decree had been rendered
inexecutable by virtue of the provisions of Section 28 of the
Specific Relief Act 1963. The High Court noted that of the total
sale consideration of Rs. 8,35,000/- under the terms of the F
agreement to sell, the appellant in 2004 had paid an amount of
Rs. 5,85,000/- while the balance of Rs. 1,15,864/-, consequent
upon the partial decree in the suit had been deposited on 19
February 2015 after the dismissal of the first appeals on 17 January
2015. According to the High Court, the time frame for the deposit
of the balance sale consideration was implicit in the decision of G
the Trial Court which had ordered the execution of the sale deed
within two months from the date of the judgment upon deposit of
the remaining sale consideration. The High Court held that the

H
1038 SUPREME COURT REPORTS [2019] 9 S.C.R.

A judgment and decree had not been stayed during the pendency
of the first appeals and the mere filing of an appeal did not amount
to a stay under Order 41 Rule 5 of the Code of Civil Procedure
1908. Hence, it was not open to the appellant to seek the
execution of the decree on account of the lapse of the period
stipulated in the decree for its execution. [Paras 7, 8]
B
[1040-F-G; 1041-A-B; 1042-A-C]
2.2 The appellant had deposited an amount of
Rs. 5,85,000/-. The partial decree of the Trial Court in the suit
for specific performance was placed in issue before the Appellate
Court. After the Appellate Court affirmed the decree, the decree
C of the Trial Court merged with that of the Appellate Court. Barely
a month thereafter, on 19 February 2015 the appellant deposited
the balance of the sale consideration. The appellant acted bona
fide. The equities in a matter arising out of a decree in a suit for
specific performance must weigh in his favour. The High Court
D impermissibly substituted the decree for specific performance
with an order for refund of the sale consideration, beyond the
earnest money of Rs. 2,00,000/- to the decree holder. The reasons
which weighed with the High Court in doing so as well as its
ultimate directions are unsustainable. [Para 21] [1050-D-F]
E Chandi Prasad v. Jagdish Prasad (2004) 8 SCC
724 : [2004] 4 Suppl. SCR 942; Sardar Mohar Singh
v. Mangilal (1997) 9 SCC 217 : [1997] 1 SCR 297;
Bhupinder Kumar v. Angrej Singh (2009) 8 SCC 766;
Kunhayammed v. State of Kerala (2000) 6 SCC 359:
[2000] 1 Suppl. SCR 538 ; Khoday Distilleries Ltd v.
F Sri Mahadeshwara Sahakara Sakkare Karkhane Ltd .
(2019) 4 SCC 376 – relied on.
Shanthi v. T D Vishwanathan Civil Appeal No. 10442
of 2011, 2018 SCC OnLine SC 2196 ; S Palanichamy
Chettiar Firm v. C Alagappan (1999) 4 SCC 702 :
G [1999] 1 SCR 349; Ramankutty Guptan
v. Avara [1994] 2 SCC 642 : [1994] 1 SCR 542 –
referred to.

H
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS . 1039

Case Law Reference A
[2004] 4 Suppl. SCR 942 relied on Para 9
[1997] 1 SCR 297 relied on Para 9
[2000] 1 Suppl. SCR 538 relied on Para 13
(2019) 4 SCC 376 relied on Para 13 B
(2009) 8 SCC 766 relied on Para 19
[1999] 1 SCR 349 referred to Para 20

CIVIL APPELLATE JURISDICTION: Civil Appeal No.5360 of C
2019
From the Judgment and Order dated 01.06.2018 of the High Court
of Punjab and Haryana at Chandigarh in Civil Revision No. 3372 of
2015
A. Tewari, Ms. Eliza Bar, Shree Pal Singh, Advs. for the Appellant. D

Gopal Jha, Adv. for the Respondent.
The Judgment of the Court was delivered by
DR DHANANJAYA Y CHANDRACHUD, J.
E
1. A learned Single Judge of the High Court of Punjab and Haryana
allowed a Civil Revision instituted by the respondents and in the process
dismissed the application of the appellant for the execution of a decree
in a suit for specific performance. Accepting the objections of the
judgment debtor, the High Court directed a refund of earnest money in
substitution of the decree for specific performance. F
2. In 2006, the appellant instituted a suit for specific performance
of an agreement to sell dated 8 December 2003. The appellant sought to
enforce an agreement for the sale of land bearing 12 kanals and 9 marlas,
representing a half share out of the land bearing Khewat Khatauni No.
565/525, Khasra No. 94/18 (7-8), 19(8-0), 20/1 (6-3), 21/1 (1-7) and 94/ G
21/3 (2-0) situated in village Billa, Tehsil and District Panchkula. On 20
March 2012, the Civil Judge (Senior Division), Panchkula decreed the
suit except for land bearing 2 kanals mentioned in the sale deed in exhibit-
D3. Insofar as is material, the decree provided thus :
H
1040 SUPREME COURT REPORTS [2019] 9 S.C.R.

A “Resultantly, a decree for possession by way of specific
performance of the agreement to sell Ex. P1 dated 08.12.2003 is
passed in favour of the plaintiff in respect of remaining suit land,
i.e., except the land of 2 kanals mentioned in sale deed Ex. D3, on
making balance sale consideration amount to the L.Rs. of defendant
No.1, after deducting the consideration of aforesaid 2 kanals land.
B
The L.Rs of the defendant No.1 are directed to execute the sale
deed in respect of the remaining suit land within a period of two
months from today in receipt of remaining balance sale
consideration after deduction of consideration of 2 kanals land
and in case of failure of the L.Rs. of defendant No.1 to do so, the
C plaintiff is entitled to get the sale deed executed and registered
quo the aforesaid land through the Court agency.”
3. Both the appellant and the respondent filed appeals against the
judgment of the Trial Court. On 23 April 2012, the Additional District
Judge, Panchkula issued notice in the appeal and on the application for
D stay filed by the respondent.
4. On 15 June 2012, the appellant filed proceedings before the
Civil Judge (Senior Division), Panchkula for seeking the execution of
the decree passed in his favour, pending the first appeal.
5. On 19 May 2014, the respondent filed objections to the execution
E petition.
6. On 17 January 2015, the Additional District Judge upheld the
judgment and order of the Trial Court while dismissing both sets of appeals
filed respectively by the appellant and the respondent.

F 7. On 23 February 2015, the executing court rejected the objections
of the respondents to the execution of the decree and allowed the
appellant’s execution petition. The respondent then filed a civil revision
before the High Court which resulted in the judgment of the learned
Single Judge dated 1 June 2018 by which the order of the executing
court was set aside. The High Court held that there was a failure on the
G part of the appellant to deposit the balance of the sale consideration
within a period of two months from the date of the decree and as a
consequence the decree had been rendered inexecutable by virtue of

H
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS. 1041
[DR DHANANJAYA Y CHANDRACHUD, J.]

the provisions of Section 281 of the Specific Relief Act 19632. The High A
Court noted that of the total sale consideration of Rs. 8,35,000/- under
the terms of the agreement to sell, the appellant in 2004 had paid an
amount of Rs. 5,85,000/- while the balance of Rs. 1,15,864/-, consequent
upon the partial decree in the suit had been deposited on 19 February
2015 after the dismissal of the first appeals on 17 January 2015. The
B
High Court opined thus:
“A perusal of the operative portion of the decree under execution
shows that though the lower court has not specifically fixed any
time for deposit of the amount of balance sale consideration but it
has been provided in unambiguous terms that the sale deed is to
be executed within two months from the date of judgment upon C
deposit of balance sale consideration.”

1
28. Rescission in certain circumstances of contracts for the sale or lease of
immovable property, the specific performance of which has been decreed.— (1)
Where in any suit a decree for specific performance of a contract for the sale or lease of
D
immovable property has been made and the purchaser or lessee does not, within the
period allowed by the decree or such further period as the court may allow, pay the
purchase money or other sum which the court has ordered him to pay, the vendor or
lessor may apply in the same suit in which the decree is made, to have the contract
rescinded and on such application the court may, by order, rescind the contract either
so far as regards the party in default or altogether, as the justice of the case may require.
(2) Where a contract is rescinded under sub-section (1), the court— (a) shall direct the E
purchaser or the lessee, if he has obtained possession of the property under the contract,
to restore such possession to the vendor or lessor; and (b) may direct payment to the
vendor or lessor of all the rents and profits which have accrued in respect of the
property from the date on which possession was so obtained by the purchaser or
lessee until restoration of possession to the vendor or lessor, and, if the justice of the
case so requires, the refund of any sum paid by the vendee or the lessee as earnest
money or deposit in connection with the contract. F
(3) If the purchase or lessee pays the purchase money or other sum which he is ordered
to pay under the decree within the period referred to in sub-section (1), the court may,
on application made in the same suit, award the purchaser or lessee such further relief
as he may be entitled to, including in appropriate cases all or any of the following
reliefs, namely:— (a) the execution of a proper conveyance or lease by the vendor or
lessor; (b) the delivery of possession, or partition and separate possession, of the
property on the execution of such conveyance or lease. G
(4) No separate suit in respect of any relief which may be claimed under this section
shall lie at the instance of a vendor, purchaser, lessor or lessee, as the case may be.
(5) The costs of any proceedings under this section shall be in the discretion of the
court.
2
Specific Relief Act
H
1042 SUPREME COURT REPORTS [2019] 9 S.C.R.

A 8. According to the High Court, the time frame for the deposit of
the balance sale consideration was implicit in the decision of the Trial
Court which had ordered the execution of the sale deed within two months
from the date of the judgment upon deposit of the remaining sale
consideration. The High Court held that the judgment and decree had
not been stayed during the pendency of the first appeals and the mere
B
filing of an appeal did not amount to a stay under Order 41 Rule 5 of the
Code of Civil Procedure 19083. Hence, it was not open to the appellant
to seek the execution of the decree on account of the lapse of the period
stipulated in the decree for its execution. The High Court has relied
upon the provisions of Section 28 of the Specific Relief Act. It also
C observed that no application for the enlargement of time had been filed
by the appellant. The correctness of this view falls for determination in
the present appeal.
9. Mr A Tewari, learned Counsel appearing on behalf of the
appellant urged the following submissions :
D (i) The judgment and decree of the Trial Court dated 20 March
2012 has merged with the decree of the First Appellate Court4
dated 17 January 2015. The doctrine of merger applies whether
the judgment of a subordinate court is reversed, modified or
upheld by a court superior to it (Chandi Prasad v Jagdish
E Prasad5);
(ii) The decree for specific performance is in the nature of a
preliminary decree and the court passing it does not become
functus officio (Sardar Mohar Singh v Mangilal6). Since
the decree of the appellate court dated 17 January 2015 makes
F no mention of the transaction becoming time barred, limitation
would commence from 17 January 2015;
(iii) The appellate court did not impose a time limit and, in
consequence, the decree dated 17 January 2015 became
enforceable from the date on which it was issued;
G (iv) The power which is entrusted to the court under Section 28 of
the Specific Relief Act is equitable in nature and it is open to
1
CPC
2
“Appellate Court”
3
(2004) 8 SCC 724
4
H (1997) 9 SCC 217
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS. 1043
[DR DHANANJAYA Y CHANDRACHUD, J.]

the court to grant additional time for the performance of any A
condition laid down in the decree (Sardar Mohar Singh)
(supra). What is of prime importance is to gauge the readiness
and the willingness of the decree holder. The judgment debtor
did not seek the rescission of the contract under the provisions
of Section 28 of the Specific Relief Act;
B
(v) The balance of equities lies in favour of the appellant who has
paid Rs. 5,85,000/- out of the total sale consideration in 2004
and only an amount of Rs. 1,15,864/- remained to be paid
after the judgment of the Trial Court; and
(vi) The provisions of Order 41 Rule 5 do not detract from the C
doctrine of merger.
10. On the other hand, Mr Gopal Jha, learned Counsel appearing
on behalf of the respondents submitted that :
(i) The doctrine of merger applies to a situation when the
limitation for the filing of an execution application is to be D
computed;
(ii) The decree of the Trial Court was conditional since it
contained a direction for the execution of the sale deed of the
suit land except 2 kanals within a period of 2 months on
receipt of the balance sale consideration. The decree con- E
tained three conditions, each of which had to be fulfilled;
(iii) In the present case, the decree of the Trial Court was not
modified by the appellate court;
(iv) No application was filed by the appellant for the extension of
F
time to effect deposit nor was any amount deposited while
filing the execution application. The High Court while
dismissing the appeal of the judgment debtor did not grant an
extension of time to the decree holder for the deposit of the
balance;
(v) The decree holder has not shown reasonable grounds for G
extension of time and the filing of an appeal does not
constitute a valid ground particularly in the absence of a stay
under Order 41 Rule 5; and

H
1044 SUPREME COURT REPORTS [2019] 9 S.C.R.

A (vi) The respondent deposited the balance of the sale
consideration on 19 February 2015 without an application under
Section 148 of the CPC for the extension of time.
For the above, it was submitted that the appellant having failed to
comply with the conditions specified in the decree dated 20 March 2012,
B the High Court was justified in allowing the respondent’s civil revision
and holding that the decree had been rendered inexecutable.
11. The rival submissions fall for our consideration.
12. By its judgment dated 20 March 2012, the Trial Court decreed
the suit for specific performance filed by the appellant save and except
C for the land admeasuring 2 kanals. The decree of the Trial Court envisaged
performance of the agreement to sell dated 8 December 2003 in respect
of the land which formed the subject matter of the suit, except for 2
kanals. The judgment debtor was directed to execute the sale deed in
respect of the remaining portion of the suit land
D (i) within a period of 2 months;
(ii) on receipt of the balance sale consideration; and
(iii) upon deducting the consideration for 2 kanals of land.
The decision of the Trial Court was carried in appeal both by the
E decree holder and by the judgment debtor. The Appellate Court issued
notice on the appeal and the application for stay filed by the judgment
debtor, while the decree holder moved for execution of the decree. The
judgment debtor had filed objections to the execution of the decree. The
Appellate Court dismissed both sets of appeals by confirming the judgment
and decree of the Trial Court.
F
13. Upon the decision of the Appellate Court, there was a merger
of the judgment of the Trial Court with the decision which was rendered
in appeal. Consequent upon the passing of the decree of an Appellate
Court, the decree of the Trial Court merges with that of the Appellate
Court. The doctrine of merger is founded on the rationale that there
G cannot be more than one operative decree at a given point in time. The
doctrine of merger applies irrespective of whether the Appellate Court
has affirmed, modified or reversed the decree of the Trial Court. In
Kunhayammed v State of Kerala7, while explaining the doctrine of
merger, this Court held thus:
7
H (2000) 6 SCC 359
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS . 1045
[DR DHANANJAYA Y CHANDRACHUD, J.]

“12. The logic underlying the doctrine of merger is that there cannot A
be more than one decree or operative orders governing the same
subject-matter at a given point of time. When a decree or order
passed by an inferior court, tribunal or authority was subjected to
a remedy available under the law before a superior forum then,
though the decree or order under challenge continues to be
B
effective and binding, nevertheless its finality is put in jeopardy.
Once the superior court has disposed of the lis before it either
way — whether the decree or order under appeal is set aside or
modified or simply confirmed, it is the decree or order of the
superior court, tribunal or authority which is the final, binding and
operative decree or order wherein merges the decree or order C
passed by the court, tribunal or the authority below. However, the
doctrine is not of universal or unlimited application. The nature of
jurisdiction exercised by the superior forum and the content or
subject-matter of challenge laid or which could have been laid
shall have to be kept in view.”
D
Further, while explaining the position that emerges on the grant of
special leave to appeal by this Court, it was observed:
“41. Once a special leave petition has been granted, the doors for
the exercise of appellate jurisdiction of this Court have been let
open. The order impugned before the Supreme Court becomes E
an order appealed against. Any order passed thereafter would be
an appellate order and would attract the applicability of doctrine
of merger. It would not make a difference whether the order is
one of reversal or of modification or of dismissal affirming the
order appealed against. It would also not make any difference if
the order is a speaking or non-speaking one…” F

This position of law has been recently affirmed and reiterated by
a three judge Bench decision of this Court in Khoday Distilleries Ltd
v Sri Mahadeshwara Sahakara Sakkare Karkhane Ltd8.
14. The decision in Kunhayammed (supra) was followed by a G
three judge Bench decision of this Court in Chandi Prasad (supra),
which held thus:
“23. The doctrine of merger is based on the principles of propriety
in the hierarchy of justice delivery system. The doctrine of merger
8
(2019) 4 SCC 376 H
1046 SUPREME COURT REPORTS [2019] 9 S.C.R.

A does not make a distinction between an order of reversal,
modification or an order of confirmation passed by the appellate
authority. The said doctrine postulates that there cannot be more
than one operative decree governing the same subject matter at a
given point of time.
B 24. It is trite that when an Appellate Court passes a decree, the
decree of the trial court merges with the decree of the Appellate Court
and even if and subject to any modification that may be made in the
appellate decree, the decree of the Appellate Court supersedes the decree
of the trial court. In other words, merger of a decree takes place
irrespective of the fact as to whether the Appellate Court affirms,
C modifies or reverses the decree passed by the trial court…”
15. More recently, the decision in Chandi Prasad (supra) was
followed by a two judge Bench of this Court in Shanthi v T D
Vishwanathan9 rendered on 24 October 2018 in the following terms :

D “7. …When an appeal is prescribed under a statute and the
appellate forum is invoked and entertained, for all intents and
purposes, the suit continues. When a higher forum entertains an
appeal and passes an order on merit, the doctrine of merger would
apply. The doctrine of merger is based on the principles of the
propriety in the hierarchy of the justice delivery system. The
E doctrine of merger does not make a distinction between an order
of reversal, modification or an order of confirmation passed by
the appellate authority. The said doctrine postulates that there
cannot be more than one operative decree governing the same
subject matter at a given point of time.”
F 16. Learned Counsel appearing on behalf of the respondents
submitted that under Order 41 Rule 5 of the CPC, an appeal does not
operate as a stay of the proceedings under a decree or order appealed
from except so far as the Appellate Court may order, nor shall execution
of the decree be stayed only by reason of an appeal having been preferred
G from the decree. The Appellate Court is however vested with the authority
to stay the execution of the decree for sufficient cause. The submission
is that since the decree was not stayed pending the disposal of the appeal,
there was no impediment in its execution and, upon the failure of the
appellant to deposit the balance in the execution proceedings, the decree
9
H Civil Appeal No. 10442 of 2011,2018 SCC OnLine SC 2196
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS . 1047
[DR DHANANJAYA Y CHANDRACHUD, J.]

becomes inexecutable. Learned Counsel submitted that in such a A
situation, application of the doctrine of merger stands obviated.
17. We are unable to accept the submission. The doctrine of
merger operates as a principle upon a judgment being rendered by the
Appellate Court. In the present case, once the Appellate Court confirmed
the judgment and decree of the Trial Court, there was evidently a merger B
of the judgment of the Trial Court with the decision of the Appellate
Court. Once the Appellate Court renders its judgment, it is the decree of
the Appellate Court which becomes executable. Hence, the entitlement
of the decree holder to execute the decree of the Appellate Court cannot
be defeated.
C
18. The issue can be looked at from another perspective in terms
of the provisions of Section 28 of the Specific Relief Act. Section 28
provides :
“28. Rescission in certain circumstances of contracts for the sale
or lease of immovable property, the specific performance of which D
has been decreed.— (1) Where in any suit a decree for specific
performance of a contract for the sale or lease of immovable
property has been made and the purchaser or lessee does not,
within the period allowed by the decree or such further period as
the court may allow, pay the purchase money or other sum which
the court has ordered him to pay, the vendor or lessor may apply E
in the same suit in which the decree is made, to have the contract
rescinded and on such application the court may, by order, rescind
the contract either so far as regards the party in default or
altogether, as the justice of the case may require.”
19. Interpreting the provisions of Section 28 of the Specific Relief F
Act, a three judge Bench of this Court held in Sardar Mohar Singh
(supra):
“4. From the language of sub-section (1) of Section 28, it could be
seen that the court does not lose its jurisdiction after the grant of
the decree for specific performance nor it becomes functus G
officio. The very fact that Section 28 itself gives power to grant
order of rescission of the decree would indicate that till the sale
deed is executed in execution of the decree, the trial court retains
its power and jurisdiction to deal with the decree of specific
H
1048 SUPREME COURT REPORTS [2019] 9 S.C.R.

A performance. It would also be clear that the court has power to
enlarge the time in favour of the judgment-debtor to pay the amount
or to perform the conditions mentioned in the decree for specific
performance, in spite of an application for rescission of the decree
having been filed by the judgment-debtor and rejected. In other
words, the court has the discretion to extend time for compliance
B
of the conditional decree as mentioned in the decree for specific
performance…”
In Bhupinder Kumar v Angrej Singh10, this Court held thus:
“21. It is clear that Section 28 gives power to the court either to
C extend the time for compliance with the decree or grant an order
of rescission of the agreement. These powers are available to the
trial court which passes the decree of specific performance. In
other words, when the court passes the decree for specific
performance, the contract between the parties is not extinguished.
To put it clearly the decree for specific performance is in the
D nature of a preliminary decree and the suit is deemed to be pending
even after the decree.
22. Sub-section (1) of Section 28 makes it clear that the court
does not lose its jurisdiction after the grant of decree for specific
performance nor it becomes functus officio. On the other hand,
E Section 28 gives power to the court to grant an order of rescission
of the agreement and it has the power to extend the time to pay
the amount or perform the conditions of decree for specific
performance despite the application for rescission of the
agreement/decree. In deciding an application under Section 28(1)
F of the Act, the court has to see all the attending circumstances
including the conduct of the parties.”
20. Learned Counsel appearing on behalf of the respondents placed
reliance on the decision in V S Palanichamy Chettiar Firm v C
Alagappan 11. While adverting to the decision of this Court in
G Ramankutty Guptan v Avara12, the two judge Bench held:
“15. …This Court observed that when the decree specifies the
time for performance of the conditions of the decree, on its failure
10
(2009) 8 SCC 766
11
(1999) 4 SCC 702
12
H (1994) 2 SCC 642
SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS . 1049
[DR DHANANJAYA Y CHANDRACHUD, J.]

to deposit the money, Section 28(1) itself gives power to the court A
to extend the time on such terms as the court may allow to pay
the purchase money or other sum which the court has ordered
him to pay. The Court held, after noticing the conflict of decisions
by the Bombay High Court and the Andhra Pradesh High Court,
that when the court which passed the decree and the executing
B
court is the same, application under Section 28 can be filed in the
executing court. However, where a decree is transferred for
execution to a transferee executing court then certainly the
transferee court is not the original court and the executing court is
not the “same court” within the meaning of Section 28 of the Act.
But when an application has been made in the court in which the C
original suit was filed and the execution is being proceeded with,
then certainly an application under Section 28 is maintainable in
the same court…”
21. In the above case, the facts before this Court were that an
agreement to sell had been executed nineteen years earlier on 16 February D
1980 and no explanation was forthcoming as to why the balance of the
sale consideration was not deposited within the time granted by the court.
No application for extension was made under Section 28 of the Specific
Relief Act. This Court observed that merely because a suit was filed
within a period of three years prescribed by Article 54 of the Limitation
Act 1963, that did not absolve the vendee-plaintiff from demonstrating E
that he was ready and willing to perform the agreement and whether the
non-performance was on account of obstacles placed by the vendor or
otherwise. In that context, this Court held:
“17. …The court has to see all the attendant circumstances
including if the vendee has conducted himself in a reasonable F
manner under the contract of sale. That being the position of law
for filing the suit for specific performance, can the court, as a
matter of course, allow extension of time for making payment of
balance amount of consideration in terms of a decree after 5 years
of passing of the decree by the trial court and 3 years of its G
confirmation by the appellate court? It is not the case of the
respondent decree-holders that on account of any fault on the
part of the vendor judgment-debtor, the amount could not be

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1050 SUPREME COURT REPORTS [2019] 9 S.C.R.

A deposited as per the decree. That being the position, if now time
is granted, that would be going beyond the period of limitation
prescribed for filing of the suit for specific performance of the
agreement though this provision may not be strictly applicable. It
is nevertheless an important circumstance to be considered by
the Court. That apart, no explanation whatsoever is coming from
B
the respondent decree-holders as to why they did not pay the
balance amount of consideration as per the decree except what
the High Court itself thought fit to comment which is certainly not
borne out from the record. Equity demands that discretion be not
exercised in favour of the respondent decree-holders and no
C extension of time be granted to them to comply with the decree.”
The facts noted in the above extract from the judgment indicate a
situation which is factually distinct. In that case, the balance of the sale
consideration was sought to be deposited three years after the
confirmation of the decree by the Appellate Court. In the present case,
D the facts clearly are to the contrary. The appellant had deposited an
amount of Rs. 5,85,000/- The partial decree of the Trial Court in the suit
for specific performance was placed in issue before the Appellate Court.
After the Appellate Court affirmed the decree on 17 January 2015, the
decree of the Trial Court merged with that of the Appellate Court. Barely
a month thereafter, on 19 February 2015 the appellant deposited the
E balance of the sale consideration. The appellant acted bona fide. The
equities in a matter arising out of a decree in a suit for specific
performance must weigh in his favour. The executing court was justified
in rejecting the specious objections of the respondents. The High Court
acted in excess of its revisional jurisdiction. The High Court impermissibly
F substituted the decree for specific performance with an order for refund
of the sale consideration, beyond the earnest money of Rs. 2,00,000/- to
the decree holder. The reasons which weighed with the High Court in
doing so as well as its ultimate directions are unsustainable. In a Civil
Revision arising out of an execution proceeding, the High Court has
modified the decree. Such a course was not open in law.
G
22. We accordingly allow the appeal and set aside the impugned
judgment and order dated 1 June 2018 of the learned Single Judge in CR
No. 3372 of 2015 (O&M). In consequence, the order passed by the
Executing Court on 23 February 2015, dismissing the objections of the

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SURINDER PAL SONI v. SOHAN LAL (D) THRU LRS . 1051
[DR DHANANJAYA Y CHANDRACHUD, J.]

respondent – judgment debtor in Execution Petition No. 2489 of 2013 A
shall accordingly stand restored.
23. The appeal is allowed in the above terms. There shall be no
order as to costs.

B
Devika Gujral Appeal allowed.

C

D

E

F

G

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