Specific Relief Act- Court Cannot Routinely Allow Time Extension For Making Payment Of Balance Amount Of Consideration: SC

The Supreme Court has observed that a Court cannot as a matter of course, allow extension of time under Specific relief Act for making payment of balance amount of consideration in terms of a decree.

"...the Court cannot as a matter of course, allow extension of time for making payment of balance amount of consideration in terms of a decree.", the Court noted.

The Court observed that discretionary power under Section 28 of the Specific Relief Act (SRA) was to be exercised judiciously as it aimed to provide complete relief to both the parties in terms of a decree of specific performance and the Court had to pass an order as the justice may require.

The Bench of Justice MR Shah and Justice C.T. Ravikumar observed that “in absence of any explanation whatsoever even by the decree holders as to why they did not pay the balance amount of consideration as per the decree or did not make an application under section 28 of the Specific Relief Act seeking extension of time for making payment, equity demands that discretion be not exercised in favour of the decree holders and no extension of time be granted to them to comply with the decree.”

Advocate Mithun Shashank appeared for the appellant and Advocate Shrey Kapoor appeared for the respondent.

In this case, Sale Agreement was executed between the appellant and the respondent for total sale consideration of Rs. 23,00,000/- against which Rs. 8,00,000/- was paid as advance and balance was directed to be deposited/paid by the respondent under the ex-parte judgment within two weeks from the date of the judgment, but no payment was made, and no efforts were being made to execute the sale deed.

Thereafter, an application under Section 148 CPC and Section 28 of the Specific Relief Act was filed before the Trial Court, with a huge delay of 853 days, wherein extension of time to deposit the balance sale consideration was sought. Trial Court condoned the delay and allowed the same. Against the decision of the Trial Court, revision was filed which was dismissed by the High Court. Aggrieved of the decision of the Telangana High Court, appeal was preferred before the Apex Court.

The Apex Court noted that an application under Section 148 CPC and Section 28 of the SRA was preferred after a delay of 853 days and observed that “If the plaintiff was ready with the money payable towards the balance sale consideration, he could have got the sale deed executed through power of attorney after effecting deposit/payment. In absence of any sufficient explanation, such a huge delay of 853 days ought not to have been condoned by the trial Court.”

Further the Court said that the Trial Court had failed to exercise the discretionary power judiciously in favour of the defendant and erred in exercising the discretionary power in favour of the plaintiff. Therefore, the Trial Court and High Court order was set aside and quashed and the application filed by the appellant to rescind the agreement to sell was allowed.

The Court further to strike the balance between the parties directed that the amount of Rs. 8,00,000/- paid by the plaintiff as an advance was to be returned to the plaintiff with 12% interest per annum.

Accordingly, the appeal was allowed.

Cause Title- P. Shyamala v. Gundlur Masthan

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