It is well-settled that when a superior court entertains an appeal on merits, the decree of the inferior court merges with that of the superior court
Note: Summary of the original judgment
Non Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No. of 2025
(Arising out of SLP(C) No. 20091 of 2022)
Dr. Amit Arya … Appellant(s)
Versus
Kamlesh Kumari … Respondent(s)
Citation: 2025 INSC 1486
JUDGMENT
Sanjay Karol, J.
1. Leave granted.
2. This appeal arises from the judgment and order dated August 8, 2022, passed by the High Court of Punjab & Haryana at Chandigarh in CR No. 979 of 2018 (O&M), titled Kamlesh Kumari v. Dr. Amit Arya. The dispute concerns the execution of an ‘agreement to sell’ between the parties regarding a property in the District of Panchkula. A sum of money was deposited as ‘earnest money’, but the transaction did not proceed. A suit for specific performance was decreed by the Trial Court, a decision ultimately affirmed in second appeal by the High Court. The appellant, as the plaintiff/decree holder, filed an execution application. The respondent’s objections to the execution were dismissed by the Executing Court. The appeal against this dismissal led to the impugned judgment, which accepted the objections and dismissed the execution petition.
BACKGROUND AND PREVIOUS PROCEEDINGS
3. The essential facts and chronology are as follows:
3.1 The parties entered into an agreement to sell on December 11, 2004, for a plot of land admeasuring 2 biswas, 10 biswasi in Kalka, District Panchkula. A sum of Rs. 1,00,000/- was paid as earnest money.
3.2 The appellant filed a suit for specific performance and permanent injunction. In the alternative, a prayer was made for recovery of Rs. 2,46,000/- with interest.
3.3 The Trial Court decreed the suit on May 14, 2011. The operative part of the decree directed the respondent to execute the sale deed upon receiving the balance sale consideration of Rs. 8,05,000/- from the appellant within two months, failing which the appellant could get the sale deed executed through the court.
3.4 The First Appellate Court, on April 22, 2013, set aside the decree for specific performance. It held the appellant was entitled only to recover double the earnest money (Rs. 2,00,000/-).
3.5 In the Second Appeal, the High Court, on February 8, 2016, set aside the First Appellate Court’s judgment and restored the Trial Court’s decree for specific performance.
3.6 The appellant filed Execution Application No. 35 of 2016 on July 4, 2016. The respondent filed objections primarily on the grounds of delay (87 days beyond the two-month period stipulated in the decree) and lack of readiness/willingness, as the balance consideration was not deposited timely.
3.7 The Executing Court dismissed the objections on January 20, 2018. In appeal, the High Court, vide the impugned order dated August 8, 2022, allowed the objections and dismissed the execution petition. The High Court concluded that the decree had become inexecutable due to the delay and the Executing Court’s lack of power to extend the time stipulated in the original decree.
4. Aggrieved, the appellant is before this Court. The core issues are: (i) Whether the execution petition was barred due to its filing beyond the two-month period stipulated in the Trial Court’s decree; and (ii) The effect of the doctrine of merger on the time stipulation after the appellate proceedings.
5. The relevant statutory provision is Section 28 of the Specific Relief Act, 1963, which grants the court the power to extend the time for payment fixed in a decree for specific performance and provides consequences for non-payment.
6. This Court in V.S. Palanichamy Chettiar Firm v. C. Alagappan (1999) 4 SCC 702, clarified that the court which passed the decree (or the same court when acting as the executing court) has the power under Section 28 to extend the time for performance.
7. The hyper-technical view that a decree becomes inexecutable solely due to a delay in depositing the balance consideration within the stipulated time has been eschewed by this Court. The real test is whether the conduct of the decree-holder shows a positive refusal to fulfill the contract (Ramankutty Gupta v. Avara (1994) 2 SCC 642; Ram Lal v. Jarnail Singh 2025 SCC OnLine SC 584).
8. On the doctrine of merger, it is well-settled that when a superior court entertains an appeal on merits, the decree of the inferior court merges with that of the superior court (Kunhayammed v. State of Kerala (2000) 6 SCC 359; Balbir Singh & Anr. v. Baldev Singh 2025 SCC OnLine SC 103). Consequently, after the High Court’s judgment in the second appeal, it is that decree which is operative. The High Court, while restoring the Trial Court’s decree, did not impose any fresh time limit for deposit. Therefore, the strict application of the original two-month period from the 2011 decree was misplaced.
9. In the present case, the appellant’s readiness and willingness to perform his part of the contract stands conclusively determined by the courts below. The delay in filing the execution application (87 days) and in depositing the balance consideration, in this context, does not indicate an abandonment of the contract. The case of Ram Lal (supra) involved condonation of far longer delays.
10. For the foregoing reasons, the impugned judgment of the High Court is unsustainable. The appeal is allowed. The judgment of the High Court is set aside, and the order of the Executing Court dated January 20, 2018, dismissing the respondent’s objections, is restored.
11. The Executing Court shall now proceed to execute the decree for specific performance in accordance with law. A copy of this judgment shall be sent to the concerned Executing Court.
12. The appeal is allowed in the above terms. All pending applications, if any, stand disposed of.
………………………J. (Sanjay Karol)
………………………J. (Manoj Misra)
New Delhi
December 19, 2025
