Kishor Ghanshyamsa Paralikar (Dead) vs Balaji Mandir Sansthan Mangrul (Nath)
Background
The appellant had a compromise decree in his favour for specific performance of an agreement to purchase agricultural land from the respondent-Trust, on payment of the balance sale consideration within one month. He was about five days late but obtained the trial court's permission to deposit the balance amount, which he did, and the sale deed was then executed in his favour. Roughly three years later, the Trust applied to cancel the sale deed and recover possession, but the trial court dismissed that application. The Bombay High Court (Nagpur Bench), however, allowed the Trust's writ petition and cancelled the sale deed for the delay in payment.
Decision Breakdown
The Supreme Court examined Section 28 of the Specific Relief Act, 1963, which lets a court retain control over a specific-performance decree and, in its discretion, extend time for payment even under a consent/compromise decree, citing its own precedent (Periyakkal v. Dakshyani) that courts may enlarge time to prevent manifest injustice and relieve against a forfeiture clause. Since the trial court had already exercised its discretion to permit the short delay and extend time for payment, giving cogent reasons, the Supreme Court held the High Court was not justified in overturning that discretionary order and cancelling the sale deed. The appeal was allowed, the High Court's order was set aside, and the trial court's order permitting the deposit was restored.
Lesson Learnt
A court that has passed a decree for specific performance retains the power to extend the time fixed for payment of the balance sale price, even under a compromise decree, in order to prevent manifest injustice from a short delay, and a higher court should not lightly upset that discretionary, reasoned extension.