Case Note & Summary
The appellant, filed a suit for specific performance of an agreement for sale of 3.75 acres of land dated 14.11.2011, wherein the respondent, agreed to sell at Rs. 16,00,000 per acre. An advance of Rs. 2,50,000 was paid. The Trial Court decreed the suit on 03.03.2017, directing the appellant to pay the balance of Rs. 57,50,000 within one month, and upon such payment, the respondent was to execute the sale deed. The appellant issued a notice on 01.04.2017 calling upon the respondent to execute the deed, but the amount was not paid or deposited within the stipulated period. The respondent filed an appeal against the decree. On 18.07.2017, the appellant applied for execution, stating readiness to deposit the amount. The Execution Court issued various orders, and on 26.11.2020, directed the appellant to deposit the amount, which was done immediately. The respondent later appeared and applied for rescission of the contract and dismissal of the execution on the ground of delayed deposit. The Execution Court dismissed the execution on 12.07.2023, holding that the decree was conditional and the amount was not deposited within one month. The High Court dismissed the revision petition. The Supreme Court allowed the appeal, holding that the delay was not fatal as the deposit was made under court orders, the respondent did not seek rescission before deposit, and the first appeal was dismissed, causing merger of the decree. The court set aside the orders of the Execution Court and High Court and directed execution of the sale deed.
Headnote
A) Specific Performance - Conditional Decree - Deposit of Balance Consideration - The decree directed payment of balance consideration within one month; the decree-holder failed to deposit within that period but later deposited under court orders. The court held that the delay was not fatal as the judgment-debtor did not seek rescission before deposit and the court itself directed the deposit. (Paras 3-14) B) Execution Proceedings - Delay Condonation - Pandemic - The delay in deposit was partly due to the COVID-19 pandemic and the court's own adjournments. The court held that such delay should be condoned in the interest of justice. (Paras 8-9) C) Merger of Decree - First Appeal Dismissed - The first appeal against the decree was dismissed after the deposit. The court held that the decree merged with the appellate decree, and the deposit could not be said to be delayed. (Para 17) D) Rescission of Contract - Timing - The judgment-debtor applied for rescission only after the deposit was made. The court held that the right to rescind must be exercised before deposit; otherwise, the contract remains enforceable. (Paras 10-14)
Issue of Consideration
Whether the execution of a decree for specific performance can be dismissed on the ground of delay in deposit of the balance sale consideration when the deposit was made under court orders and the judgment-debtor did not seek rescission before such deposit.
Final Decision
The Supreme Court allowed the appeal, set aside the orders of the Execution Court and the High Court, and directed the Execution Court to proceed with the execution of the decree and register the sale deed in favour of the appellant upon payment of the balance consideration already deposited.
Law Points
- Specific performance
- conditional decree
- deposit of balance consideration
- delay condonation
- merger of decree
- rescission of contract
- execution proceedings
