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Habban Shah v. Sheruddin

Civil Appeal · 2026 INSC 451Decided 6 May 2026
C.A. No.-007062-007062 - 2026
Justice Pankaj Mithal · Justice S.V.N. Bhatti

Background

Habban Shah (the seller) agreed in 2005 to sell agricultural land in Haryana to Sheruddin (the buyer) for Rs. 5,00,000 per acre, receiving Rs. 80,000 as advance, with the sale deed to be executed by March 2006. When the seller failed to execute the deed, the buyer sued for specific performance, and in 2012 the trial court decreed the suit, directing the seller to execute the sale on receipt of the balance consideration within three months, failing which the buyer could get it executed through the court. The buyer did not deposit the balance amount within that three-month window; instead, after the decree survived a first appeal and a second appeal (both dismissed years later, without any fresh time being granted), the buyer moved to execute the original decree in 2015, roughly three years after it was passed. The seller objected that the decree had become inexecutable due to the delay, but the Executing Court and the Punjab and Haryana High Court rejected the objection, prompting the seller's appeal to the Supreme Court.

Decision Breakdown

The Supreme Court held that because the decree of specific performance expressly made deposit of the balance sale consideration within three months a condition of relief, that time became "of the essence," and the buyer was required to strictly prove continuous readiness and willingness to perform by actually depositing the money within that window. Unlike the companion case decided the same period (where an ambiguous decree left room for the court to extend time), here the decree's own terms were clear and the buyer simply failed to comply, undermining his claim of readiness and willingness. The Court held that granting equitable, discretionary relief like specific performance requires the party benefiting from it to fulfil the conditions attached, and the buyer's three-year delay, especially where land values may have risen substantially in the interim, disentitled him to the decree's benefit. The Court set aside the High Court and Executing Court orders, declared the decree inexecutable and the contract rescinded, and directed the seller to refund the Rs. 80,000 earnest money with 8% simple interest from 2005, failing which the seller could sell part of the land to satisfy the refund.

Lesson Learnt

A decree of specific performance is not a permanent, unconditional entitlement. When the decree itself fixes a firm deadline for depositing the purchase money, a buyer who wants to enforce it must strictly comply within that time, and years of inaction can render the decree unenforceable even after it has survived multiple appeals.

Official source (sci.gov.in)View Judgment (PDF)

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