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Civil · Reportable judgment

Ishwar (Since Deceased) Thr. Lrs & Ors. vs Bhim Singh & Anr.

Court
Supreme Court of India
Date
3 September 2024
Case No.
CIVIL APPEAL No. 10193/2024
Result
Dismissed
Bench
J.B. Pardiwala, Manoj Misra
Citation
[2024] 9 S.C.R. 1 : 2024 INSC 651
Acts & Sections
Specific Relief Act, 1963 Constitution
Supreme Court Reports [2024] 9 S.C.R. 1 : 2024 INSC 651
Issue for consideration
Issue arose as to whether the execution court had jurisdiction to deal with the application for rescission of contract and extension of time to deposit the balance sale consideration; and if execution court had the jurisdiction, whether those applications ought to have been decided as one in the suit on original side, if yes, then, whether, in the facts of the case, on that ground alone, the impugned order warrants interference in exercise of jurisdiction Art 136 of the Constitution.
Headnote

Specific Relief Act, 1963 – s. 28 – Rescission in certain circumstances of contracts for the sale or lease of immovable property, the specific performance of which has been decreed – Application for rescission of contract and extension of time to deposit the balance sale consideration – Jurisdiction of the execution court:

Held: Bare reading of s. 28 gives an impression that the power to extend time to deposit, or to rescind the contract on failure of deposit vests in the Court which passed the decree – Expression “may apply in the same suit in which the decree is made” as used in u/s. 28 must be accorded an expansive meaning so as to include the court of first instance even though the decree under execution is passed by the appellate court, because the decree is in the same suit – Thus, an application u/s. 28, either for rescission of contract or for extension of time, can be entertained and decided by the execution court, provided it is the court which passed the decree in terms of s. 37 CPC – On facts, the Court of first instance, (where the civil suit was instituted) and the execution application was filed before the Court of Additional Civil Judge (Senior Division) – Application u/s 28 was disposed of by the Court of Civil Judge (Senior Division) – Thus, by virtue of s. 37 CPC, the execution court being the Court of first instance with reference to the suit in which the decree was passed had jurisdiction to deal with the application u/s. 28 of the Act – Thus, the objection as regards the jurisdiction of the execution court to deal with the application for extension of time/rescission of the court u/s. 28(1) is rejected. [Paras 15, 18, 19]

Specific Relief Act, 1963 – s. 28 – Rescission in certain circumstances of contracts for the sale or lease of immovable property, the specific performance of which has been decreed – Execution court to decide the application u/s. 28 as an application on the original side (as an application in the suit) or on the execution side (as an application in the execution proceedings):

Read the full headnote (1 more paragraph)

Held: Application seeking rescission of contract, or extension of time, u/s. 28 (1), must be decided as an application in the original suit wherein the decree was passed even though the suit has been disposed of – Thus, even if the execution court is the Court of first instance with reference to the suit wherein the decree under execution was passed, it must transfer the application filed u/s. 28 to the file of the suit before dealing with it. [Para 22] Constitution of India – Art. 136 – Jurisdiction under – Exercise of – Suit for specific performance of agreement by respondents against appellants, partly decreed, directing the appellants to refund the earnest money – Appeal thereagainst, allowed by the appellate court, directing the appellants to execute the sale deed in favour of the respondent on payment of balance sale consideration within the stipulated period, failing which the respondents could get the sale deed executed through the court – Application for execution of the decree and deposit of balance sale price by the respondents – During pendency, appellants filed second appeal which was dismissed – Respondent’s then filed application before the execution court seeking permission to deposit the balance consideration in the court, whereas the appellant filed application u/s. 28 to rescind the contract – However, the execution court rejected the appellant’s application and permitted the respondents to deposit the balance consideration – Aggrieved appellant, then filed revision which was dismissed – Interference with: Held: Not called for – Court does not exercise its jurisdiction u/Art. 136 only because it is lawful to do so – For the purpose of doing complete justice to the parties, the Court may not interfere with the order even if it suffers from some legal error – Court may deny relief to a party having regard to its conduct and may, in a given situation, mould the relief to do complete justice to the parties – On facts, the respondents had all throughout shown their intention to pay the balance consideration for execution of the sale deed whereas the appellants appeared interested only in challenging the decree before higher Courts – Execution court justifiably exercised its discretion in favour of the decree holder by allowing them to deposit the balance consideration – Thus, substantial justice has been done to the parties and if the impugned order is interfered with only on the technical ground that the application was not dealt with as one on the original side, grave injustice would be caused to the decree holder – More so, when the judgment-debtor themselves applied to the execution court for rescinding the contract, and raised no such jurisdictional issue either before the Execution Court or the High Court – Furthermore, the plea that there was no proper prayer for condonation of delay in making the deposit of the balance consideration, or that there was no proper application for extension of time to make deposit cannot be accepted because, in the execution application itself, which was promptly filed after expiry of 60 days from the date of the appellate court decree, the decree holder had sought permission to make deposit; and the application filed after dismissal of second appeal also sought permission to make deposit – Prayer to extend the time to make deposit was thus implicit in the prayer to permit the decree holder to make deposit of the balance consideration. [Paras 24, 27-30]

Keywords: Execution court · Application for rescission of contract · Application for extension of time to deposit the balance sale consideration · Suit on original side · Jurisdiction of the execution court · Court of first instance · Suit for specific performance of agreement · Refund the earnest money · Payment of balance sale consideration · Discretionary jurisdiction · Condonation of delay

As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Nidhi Jain. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.

Full Judgment Text

Judgment Manoj Misra, J. 1. Leave granted. 2. This appeal impugns an order of the High Court of Punjab and Haryana at Chandigarh 1 dated 11.01.2017 passed in Civil Revision No. 8105 of 2016, whereby the revision preferred by the appellant(s) against the order of the Civil Judge (Senior Division), Kaithal 2 dated 03.11.2016 was dismissed. High Court Execution Court FACTUAL MATRIX 3. A suit for specific performance was instituted by the respondents against the appellant(s) (which would include their predecessor in interest) for enforcement of an agreement to sell dated 18.05.2005. In the
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