M. K. Raghavan, S/o. Kannan Komaram v. Seerakath Mariyam Beevi, D/o. Late N. P. Muhammed Haji
2021-07-29
V.G.ARUN
body2021
DigiLaw.ai
ORDER : Revision petitioner is plaintiff in O.S.No.107 of 2010 on files of Subordinate Judge’s Court, Payyannur. suit was filed for a decree of specific performance directing respondent to execute sale deed in terms of agreement dated 22.8.2008. During pendency of suit, parties arrived at a settlement and lower court rendered judgment and decree in terms of settlement. As per terms of compromise decree, sale consideration was fixed at Rs.70 lakhs, out of which Rs.5 lakhs had already been paid to defendant. balance sale consideration was to be paid off by depositing Rs.25 lakhs in defendant's account on or before 30.1.2018 and Rs.40 lakhs, on or before 31.3.2018. Thereupon, sale deed was to be registered in plaintiff’s favour. It was also stipulated that on failure of plaintiff to deposit balance amount, defendant could adjust advance amount of Rs.5 lakhs towards loss sustained by him and plaintiff's right to get back amount will stand forfeited. 2. petitioner failed to pay amount of Rs.65 lakhs towards balance sale consideration within time. Instead, he caused a lawyer notice dated 28.4.2018 to be issued, requiring defendants to hand over original documents of property for raising funds. defendants issued reply notice on 9.5.2018 stating that handing over of original documents was not part of agreement and that plaintiff had already breached terms of agreement. Thereafter, petitioner filed I.A.No. 499 of 2018 under Section 28(1) of Specific Relief Act, 1963 seeking extension of time for paying balance sale consideration. respondent opposed prayer for extension, contending that court having rendered a compromise decree, extension of time at instance of one party will amount to varying of decree unilaterally. By impugned order, court below dismissed application for extension, holding that a compromise decree is passed based on agreement between parties and terms of said agreement cannot be varied without consent of both parties. 3. Heard Sri.Satheesan Alakkadan, learned counsel for petitioner and Sri.Kaleeswaram Raj, learned counsel for respondent. 4. Learned counsel for petitioner assailed finding in impugned order contending that contract between parties does not get extinguished by court passing decree for specific performance. Such a decree being preliminary in nature, suit is deemed to be pending even after decree.
3. Heard Sri.Satheesan Alakkadan, learned counsel for petitioner and Sri.Kaleeswaram Raj, learned counsel for respondent. 4. Learned counsel for petitioner assailed finding in impugned order contending that contract between parties does not get extinguished by court passing decree for specific performance. Such a decree being preliminary in nature, suit is deemed to be pending even after decree. Relying on decision in Smt.Periyakkal and Others v. Smt.Dhakshyani [ AIR 1983 SC 428 ], it is contended that agreement between parties gets merged with order of court and hence court’s freedom to act in furtherance of ends of justice is not curtailed by compromise. decision of Apex Court in Kumar Dhirendra Mullick and others v. Tivoli Park Apartments (P) Ltd. [ (2005) 9 SCC 262 ] is cited to contend that while exercising power under Section 28(1) of Specific Relief Act, court does not become functus officio after granting decree for specific performance. 5. Learned counsel for respondent drew attention to stipulation in agreement that, failure to deposit balance sale consideration would result in advance sale consideration of Rs.5 lakhs received by respondent being adjusted towards loss sustained by him and petitioner not being entitled to get back amount. It is argued that in light of said self working stipulation, petitioner is not entitled for extension of time. Support for proposition is sought to be garnered from decision of Apex Court in Gupta Steel Industries v. Jolly Steel Industries Pvt.Ltd and another [ (1996) 11 SCC 678 ] and of this Court in Kappothoora Chandran and others v. N.Mustafa [ (2011) 3 KLT 245 ]. 6. Section 28 of Specific Relief Act provides for rescission of contract in certain circumstances, specific performance of which has been decreed. Sub-section (1) of Section 28, which is contextually relevant, reads as under; “28. Rescission in certain circumstances of contracts for sale or lease of immovable property, specific performance of which has been decreed.
6. Section 28 of Specific Relief Act provides for rescission of contract in certain circumstances, specific performance of which has been decreed. Sub-section (1) of Section 28, which is contextually relevant, reads as under; “28. Rescission in certain circumstances of contracts for sale or lease of immovable property, specific performance of which has been decreed. (1) Where in any suit a decree for specific performance of a contract for sale or lease of immovable property has been made and purchaser or lessee does not, within period allowed by decree or such further period as court may allow, pay purchase money or other sum which court has ordered him to pay, vendor or lessor may apply in same suit in which decree is made, to have contract rescinded and on such application court may, by order, rescind contract either so far as regards party in default or altogether, as justice of case may require. (2) xx xx xx” On a reading of Section, it is evident that court which passed decree has power to extend time for payment of purchase money. Here, question is whether such power could be exercised in cases where specific performance decree is based on a compromise agreement containing self operative clauses, between parties. In Periyakkal (supra), suit for recovery of money was decreed based on compromise. An application for extension of time stipulated in decree was filed under Section 148 CPC Apex Court held as follows; “4. ….. parties, however, entered into a compromise and invited court to make an order in terms of compromise, which court did. time for deposit stipulated by parties became time allowed by court and this gave court jurisdiction to extend time in appropriate cases. Of course, time would not be extended ordinarily, nor for mere asking. It would be granted in rare cases to prevent manifest injustice. True, court would not rewrite a contract between parties but court would relieve against a forfeiture clause; And, where contract of parties has merged in order of court, court's freedom to act to further ends of justice would surely not stand curtailed......” 7. This Court in Kappothoora Chandran (supra), held that relief extended in Periyakkal was based on peculiar facts of that case and cannot be made applicable in cases where there are self working clauses in decree.
This Court in Kappothoora Chandran (supra), held that relief extended in Periyakkal was based on peculiar facts of that case and cannot be made applicable in cases where there are self working clauses in decree. In Kumar Dhirendra Mullick (supra), Apex Court granted extension of time for payment finding that decree in question was not a self operative final decree. In Compack Enterprises India (P) Ltd. v. Beant Singh [2021 SCC OnLine SC 97], Apex Court, after a detailed precedential survey, held that courts would be slow to unilaterally interfere in, modify, substitute or modulate terms of a consent decree, unless it is done with consent of all parties thereto. It was also observed that above proposition is far from absolute and does not apply as a blanket rule and that a consent decree would not serve as an estoppel, where compromise was vitiated by fraud, misrepresentation or mistake. 8. terms of compromise decree in instant case required petitioner to pay Rs.25 lakhs on or before 30.1.2018 and Rs.40 lakhs, before 31.3.2018. petitioner neither paid amounts within time, nor seek extension before expiry of period stipulated in decree. By time application for extension was filed, self operative clause had come into effect, resulting in advance amount of Rs.5 lakhs paid by petitioner being forfeited. Being so, extension of time will definitely amount to rewriting of terms of compromise, which court cannot do even in exercise of power under Section 28(1) of Specific Relief Act. Therefore, general proposition that court which passed decree for specific performance does not become functus officio and has power to extend period of payment of purchase price, will not apply. Hence, court below was justified in rejecting application for extension of time. For reasons aforementioned, civil revision petition is dismissed.