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Synopsis

The Supreme Court recently said once the high court as an appellate court in second appeal renders its judgment, it is a decree of the second appellate court which becomes executable hence, the entitlement of the decree holder to execute the decree of the second appellate court cannot be defeated.

A bench of Justices J B Pardiwala and R Mahadevan referred to the doctrine of merger which is founded on the rationale that there cannot be more than one operative decree at a given point of time. The doctrine of merger applies irrespective of whether the appellate court has affirmed, modified or reversed the decree of the trial court, the court said.

In an appeal filed by Balbir Singh and another, the court dealt with the effect of merger of the trial court’s decree with that of the decree passed by high court in second appeal and secondly, whether the defendants or judgment debtors can pray for rescission of contract on the ground that the plaintiffs or decree holders failed to deposit the balance sale consideration within the stipulated time period as prescribed in the original decree.

Referring to Section 28 of the Specific Relief Act, the bench pointed out it seeks to provide complete relief to both the parties in terms of a decree for specific performance in the same suit without requiring one of the parties to initiate separate proceedings.

"The object is to avoid multiplicity of suits. Under the present provision where the purchaser or lessee has paid the money, he is entitled in the suit for specific performance to the reliefs as indicated in sub-section (3) like, partition, possession, etc. A suit for specific performance does not come to an end on passing of a decree and the court which has passed the decree for specific performance retains the control over the decree even after the decree has been passed," it said.

The court explained in a given case the trial court while passing a conditional decree in a suit for specific performance may say so in so many words that if the plaintiff fails to deposit the balance sale consideration within a particular period of time stipulated by the court while allowing the suit, the failure to make such deposit within the time prescribed would have the effect of dismissal of suit. In other words, there could be a decree which may say that if the plaintiff fails to deposit the balance sale consideration within the stipulated time period, the suit shall automatically stand dismissed.

"If such is the nature of the decree then will the court concerned become “functus officio” and would have no jurisdiction to grant extension of time fixed by the decree for the purpose of deposit? This is one issue that the Supreme Court one day in an appropriate case may have to consider and decide. We say so because there are conflicting views of different High Courts, including to some extent of this Court. In the present case, it is not necessary for us to look into and decide this issue because the decree is not of such a nature," the bench said.

The court also pointed out it is well-settled position of law that when time for payment of money is extended, it does not mean a modification of the decree. The trial court has the power to extend the time, and the expression “such further period as the court may allow” would mean the court which had passed the decree, or, where the application under Section 28 of the Act of 1963, is filed.

The counsel appearing for the appellant pointed towards the failure on the part of the decree-holder(plaintiff) to deposit the balance sale consideration within 20 days from the date of the judgment passed by the high court in second appeal.

His argument was that the trial court while allowing the suit filed by the plaintiff for specific performance had specifically directed that the plaintiff shall deposit the balance sale consideration with the court within 20 days from the date of the judgment passed by the trial court.

The counsel said this very decree passed by the trial court came to be affirmed by the high court in second appeal and, therefore, the plaintiff was obliged to deposit the balance sale consideration within 20 days from the date the high court delivered its judgment in second appeal. The counsel relied upon the doctrine of merger.

"The doctrine of Merger or the Merger doctrine in civil proceedings is a common law doctrine that stems from the idea of maintenance of the decorum of the hierarchy of courts and tribunals," the bench said.

Thus, the high court while allowing the second appeal filed by the original plaintiff had not issued any specific direction as regards the deposit of the balance sale consideration within a particular period of time.

"It is incorrect on the part of the appellant herein to say that since the trial court had directed that the balance sale consideration shall be deposited within 20 days, the same direction would be applicable even after the judgment of the High Court in second appeal," the bench said.

The court felt convinced that the high court committed no error much less any error of law in passing the impugned judgment.

In the case, the Punjab and Haryana High Court rejected all the four revision applications filed by the original defendants by a common order and thereby affirmed the order passed by the executing court permitting the original plaintiff to deposit the balance sale consideration and rejecting the application filed by the defendants (judgment debtors) under Section 28 of the Specific Relief Act, 1963 for rescission of contract.

Case Title: Balbir Singh & Anr Vs Baldev Singh (D) Through His LRs & Ors Etc