The Supreme Court allowed the Civil Appeal arising out of SLP (C) No. 14206 of 2025 and set aside the judgment and order of the High Court of Madhya Pradesh at Jabalpur dated 05.03.2025 passed in Misc. Petition No. 4682 of 2023 which had upheld the order of the 7th Additional District Judge, Satna dated 12.07.2023 dismissing Execution Case No. 27A/2017. The Court restored the execution proceedings and remitted the matter to the Execution Court for fresh adjudication in accordance with the principles laid down in the judgment.
The appellant had obtained a decree for specific performance on 03.03.2017 directing him to pay or deposit the balance sale consideration of Rs. 57,50,000 within one month for execution and registration of the sale deed in respect of 3.75 acres of land. Though the appellant issued a timely notice and initiated execution proceedings in 2017, the actual deposit was made on 26.11.2020 pursuant to orders of the Execution Court. The respondent moved an application under Section 28 of the Specific Relief Act, 1963 seeking rescission of the contract on the ground of delay in deposit. The Execution Court dismissed the execution application holding that the deposit was not made within the time fixed in the decree. The High Court affirmed the said view.
The Supreme Court extensively examined Section 28 of the Specific Relief Act, 1963 and the consistent judicial precedents on the subject. It held that a decree for specific performance is in the nature of a preliminary decree and the Court which passed the decree does not become functus officio. It retains jurisdiction to either rescind the contract or extend the time for payment or deposit even after the period stipulated in the decree. There is no automatic rescission merely on failure to deposit within the stipulated time unless the decree itself provides for such automatic consequence. The power under Section 28 is discretionary and must be exercised on equitable principles after considering all attending facts and circumstances including the conduct of the parties. While examining a prayer for extension of time, the Court is not required to insist on explanation of each dayās delay as in an application under Section 5 of the Limitation Act. The real test is whether the conduct of the decree holder shows willful negligence or positive refusal to perform his part of the contract. The Court may impose additional terms to compensate the judgment debtor for the delay. The Court also clarified the principles relating to merger of decrees and the maintainability of applications under Section 28.
The Supreme Court found that both the Execution Court and the High Court had adopted a hyper-technical approach without properly exercising the discretion vested under Section 28. They failed to consider relevant factors such as the conduct of the respondent who had challenged the decree in appeal, repeated adjournments granted by the Execution Court, the intervening Covid-19 pandemic, and the fact that the deposit was made under orders of the Court itself. The appeal was accordingly allowed and the matter remitted for fresh consideration.
Case Details:
Title: Anand Narayan Shukla v. Jagat Dhari
Case No.: Civil Appeal No. 7355 of 2026 (arising out of SLP (C) No. 14206 of 2025)
Coram: Justice Manoj Misra
Date of Judgment: May 2026
Click HERE for full Judgment.
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