A) ABSTRACT / HEADNOTE

Ram Lal v. Jarnail Singh (Now Deceased) through its LRs & Ors., Civil Appeal No. 3245 of 2025 (25 Feb 2025) examines the interplay between a decree for specific performance, the doctrine of merger, and the court’s continuing jurisdiction under Section 28 of the Specific Relief Act, 1963 together with Order XX, Rule 12A CPC. The trial court granted specific performance with a two-month timeline to deposit the balance sale consideration; the first appellate court affirmed the decree but did not stipulate a deposit time.

The decree-holder delayed instituting execution and sought permission to deposit the balance consideration approximately two years after appellate dismissal; deposit was made in 2019. The High Court set aside the executing court’s order as the decree had become “inexecutable” because of delay; the Supreme Court reversed, holding that:

(i) once the appellate court affirms a decree the appellate decree merges with the trial decree and becomes the operative, executable decree;

(ii) the court retains jurisdiction under Section 28 to extend time and should exercise discretion considering bona fides, reason for delay, length of delay and equities created during the interregnum;

(iii) appellate courts disposing appeals on merits ought to specify a reasonable time for deposit under Order XX, r.12A CPC; and

(iv) where delay exists but deposit is ultimately made, the executing court may permit execution subject to equities such as interest.

The Court directed disbursement of the deposited amount to judgment-debtors with interest and required the decree-holder to pay simple interest at 9% from the date of the appellate judgment to the deposit date.

Keywords: Specific performance; Section 28 Specific Relief Act; Order XX, r.12A CPC; merger doctrine; execution; delay; appellate decree; interest.

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

This appeal probes whether a decree for specific performance becomes inexecutable merely because the decree-holder failed to deposit the balance sale consideration within the time specified in the trial court’s decree and delayed seeking execution after appellate dismissal. The trial court decreed specific performance on 20-01-2012, directing deposit within two months. The defendant appealed; the appellate court dismissed the appeal on 21-04-2015 but did not prescribe a fresh timeframe for deposit. Execution proceedings were initiated in January 2017; the executing court by order dated 06-05-2019 permitted the decree-holder to deposit the balance and directed execution upon payment.

The executing court’s order was impugned before the High Court by the judgment-debtors, which allowed revision on 30-08-2022 holding that delay had rendered the decree inexecutable. The present appeal challenges the High Court’s interference and asks whether the appellate dismissal without an express deposit deadline absolves the executing court of the power to permit belated deposit and execution.

The Supreme Court’s analysis navigates statutory text, precedent and equitable considerations: it emphasizes the merger of trial and appellate decrees, the continuing jurisdiction of courts under Section 28 to extend time, and the duty on appellate courts under Order XX, r.12A CPC to specify a payment period when disposing appeals on the merits. The judgment synthesizes prior authorities (including Prem Jeevan, V.S. Palanichamy, Ramankutty Guptan, Kunhayammed, Chandi Prasad and Khoday Distilleries) and sets out discrete factors guiding the discretion to condone delay and permit deposit.

D) FACTS OF THE CASE

The plaintiff sued for specific performance based on an agreement of sale dated 16-11-2006 concerning agricultural land; the trial court decreed performance on 20-01-2012, directing deposit of the balance sale consideration within two months and execution within three months. The defendants appealed; the first appellate court dismissed the appeal on 21-04-2015 and directed preparation of decree but did not specify any period for payment.

No further appeals were taken and the decree became final. The decree-holder did not deposit the balance immediately; an execution petition seeking permission to deposit was filed in January 2017 and finally the executing court on 06-05-2019 permitted deposit within 15 days; the decree-holder deposited Rs. 4,87,000 on 20-05-2019. The judgment-debtors challenged the executing court’s order before the High Court which set it aside on 30-08-2022, opining that the delay (approx. three years after appellate dismissal) and lack of cogent reasons rendered the decree inexecutable.

The Supreme Court was seized of the correctness of the High Court’s interference and whether courts (including appellate courts) must and may fix time by which the decree-holder must perform and whether belated deposit in execution can be permitted subject to conditions such as interest.

E) LEGAL ISSUES RAISED

i. Whether a decree for specific performance affirmed by an appellate court but without an express time for deposit becomes inexecutable because the trial decree’s time limit expired?
ii. Whether the doctrine of merger makes the appellate decree the operative decree for execution?
iii. Whether courts retain jurisdiction under Section 28, Specific Relief Act, 1963 to extend time to deposit purchase money after expiry of the trial decree period?
iv. What factors should guide the exercise of discretion under Section 28 when condoning delay and permitting belated deposit?
v. Whether appellate courts disposing appeals on merits should specify a period for payment under Order XX, r.12A CPC?

F) PETITIONER / APPELLANT’S ARGUMENTS

i. The appellant submitted that mere delay in filing execution and seeking permission to deposit does not render the decree inexecutable; a decree of specific performance remains executable for 12 years under the Limitation Act and execution ought to be permitted where payment is made.
ii. It was urged that no application under Section 28 was filed by the respondents for rescission and that the executing court acted within discretion in allowing deposit; the appellant had bona fide intentions and ultimately deposited Rs. 4,87,000 on 20-05-2019.

G) RESPONDENT’S ARGUMENTS

i. The respondents contended that there was a gross delay (two years to seek execution; four years to deposit) contrary to the trial decree’s two-month mandate and absence of any explanation warranted treating the decree as inexecutable.
ii. Reliance was placed on Prem Jeevan and V.S. Palanichamy to show that failure to comply with stipulated time in the decree and absence of extension may disentitle decree-holders to execution and that equity disfavors such belated attempts.

H) RELATED LEGAL PROVISIONS 

i. Section 28, Specific Relief Act, 1963 — rescission where purchaser fails to pay within period allowed by decree and power to extend time.
ii. Order XX, Rule 12A, Civil Procedure Code — decree for specific performance must specify period within which purchase-money shall be paid.
iii. Limitation principles governing suits for specific performance and execution (reference to Articles/limitations as considered in precedent).

I) JUDGMENT 

The Supreme Court reversed the High Court and affirmed the executing court. The Court first emphasised the doctrine of merger: when an appellate court disposes of an appeal on merits it becomes the operative decree; thus the decree executable is that of the appellate court. The Court held that Order XX, r.12A CPC requires courts to specify a period for deposit in decrees for specific performance; where an appellate court affirms and does not fix time, it is incumbent to do so, but failure to stipulate does not automatically render the decree inexecutable.

The Court elaborated that a decree for specific performance is preliminary and the court retains jurisdiction under Section 28 to deal with consequences of non-payment including rescinding the contract or extending time. While the appellant had delayed in instituting execution and in depositing money, the Court found that the executing court rightly exercised discretion to permit deposit and that the High Court erred in setting that order aside without adequately weighing factors such as bona fides, reason for delay, length of delay and equities arising in the interregnum.

The Court also observed that non-payment by itself does not amount to abandonment; there must be wilful negligence or a positive refusal to perform before rescission is appropriate. The Supreme Court directed the deposited sum to be disbursed to respondents with accrued interest and ordered the appellant to deposit simple interest at 9% p.a. from the date of appellate judgment to the deposit date; the appeal therefore succeeded and the executing court’s order was restored.

a. RATIO DECIDENDI

The decisive legal propositions are:

(1) the appellate decree, once rendered, is the operative decree and merger applies;

(2) courts retain jurisdiction under Section 28 to extend time and to entertain applications for rescission, and this power can be exercised at the appellate stage;

(3) Order XX, r.12A CPC obliges the court to specify the period for deposit in decrees for specific performance appellate courts disposing appeals on merits should specify such time; and

(4) delay, standing alone, does not ipso facto render a decree inexecutable the court must consider bona fides, length and cause of delay, and equities before ordering rescission or refusing belated deposit.

The Supreme Court applied these principles to validate executing court’s discretion where the decree-holder eventually deposited the sum and no conclusive evidence of wilful refusal was found.

b. OBITER DICTA

The Court observed in obiter that while appellate courts ought to specify timelines under r.12A, where they fail the decree-holder should act within a reasonable period; otherwise the executing court may, in exercise of discretion under Section 28, refuse relief. The judgment reiterated that Section 28 is not akin to a rigid limitation exercise under Section 5 of the Limitation Act where each day’s delay is mechanically explained; instead a balanced equitable appraisal is required.

The Court further commented that execution within the statutory 12-year window (limitation) does not confer an unfettered right to delay: execution must be sought reasonably and subject to judicial evaluation of equities. These observations serve as qualitative guidance but do not substitute the ratio.

c. GUIDELINES 

i. Appellate courts disposing appeals on merits should expressly fix a time for deposit of balance sale consideration in accordance with Order XX, r.12A CPC.
ii. Where appellate decree fails to fix such time the decree-holder must deposit within a reasonable period; what is reasonable depends on facts.
iii. Executing courts exercising Section 28 must weigh: bona fides of decree-holder; explanation for delay; length of delay; prejudice or equities in favour of judgment-debtor during interregnum; and whether conduct amounts to wilful refusal to perform.
iv. Mere non-deposit is not automatic rescission; rescission requires positive default or wilful neglect.
v. Where belated deposit is permitted, courts may order equitable adjustments (interest, costs) to compensate the judgment-debtor for delay — here simple interest at 9% was directed for the interregnum period.

J) CONCLUSION & COMMENTS

This judgment reinforces that execution of decrees for specific performance is a blend of statutory command and equitable discretion. The Court’s directions vindicate the principle that appellate decrees are operative but that courts are empowered and obliged to manage execution pragmatically under Section 28 and Order XX, r.12A CPC. Practitioners must note two practical takeaways:

(a) when an appeal is decided on merits appellate courts should, as a rule, fix a convenient period for deposit to avoid ambiguity and subsequent disputes; and

(b) decree-holders who delay must expect judicial scrutiny of motives and possible imposition of equitable costs or interest.

The Court struck a balanced path protecting the decree-holder’s right to performance while safeguarding the judgment-debtor from stale or unfair claims and thereby supplied a workable matrix of factors to guide lower courts. The decision is instructive for execution practice and clarifies that Section 28 is a discretionary but potent instrument to mould relief consistent with justice.

K) REFERENCES

a. Important Cases Referred

1. Prem Jeevan v. K.S. Venkata Raman & Anr., (2017) 11 SCC 57.

2. V.S. Palanichamy Chettiar Firm v. C. Alagappan, [1999] 1 SCR 349 : (1999) 4 SCC 702.

3. Ramankutty Guptan v. Avara, [1994] 1 SCR 542 : (1994) 2 SCC 642.

4. Kunhayammed v. State of Kerala, [2000] Supp. 1 SCR 538 : (2000) 6 SCC 359.

5. Khoday Distilleries Ltd. v. Sri Mahadeshwara Sahakara Sakkare Karkhane Ltd., [2019] 3 SCR 411: (2019) 4 SCC 376.

6. Chandi Prasad v. Jagdish Prasad, [2004] Supp. 4 SCR 942 : (2004) 8 SCC 724.

7. Shanthi v. T.D. Vishwanathan, (2019) 11 SCC 419.

8. Krishnamoorthy v. Shanmugasundaram & Anr., 2022 SCC OnLine Mad 963.

b. Important Statutes Referred

1. Specific Relief Act, 1963, s.28.

2. Civil Procedure Code, 1908, Order XX, r.12A.

3. Limitation Act, 1963 (Articles on limitation for specific performance and execution issues referenced).