Read Order: Dalbir Kaur and Another v. Kahsmir Singh and Others

Monika Rahar

Chandigarh, March 3, 2022: While dealing with a revision petition, the Punjab and Haryana High Court has held that Section 28 of the Specific Relief Act, 1963 which provides for rescission of a contract by a Court order on an application in this regard made to the Court which passed the decree, does not make it mandatory for the Court to rescind the contract upon delayed deposit of the purchase money as agreed upon in an agreement to sell.

The bench of Justice Sudhir Mittal has held that this section is in the nature of an enabling provision and does not confer an indefeasible right. 

The petitioners (Judgment Debtors- JDs) approached the Court because the Executing Court refused to recall the order by which they were proceeded against ex parte.

The first Respondent-plaintiff filed a suit for possession by way of specific performance of an agreement to sell in respect of the suit property. During the suit pendency, a settlement was reached between the parties as a result of which a compromise decree was passed. The sale deed was to be executed in a time-bound manner and in case the remaining consideration was not deposited by then, the earnest money would stand forfeited and the agreement would stand cancelled. According to the petitioners, the balance amount was deposited after lapse of the agreed time. Thereafter, an execution petition was preferred and the JDs were proceeded against ex parte

Application for setting aside the ex parte order was filed but the same was dismissed vide the impugned order. The Executing Court found that service was effected through an adult male member of the family i.e. the husband of the first JD.(son of deceased second JD) and thus, no valid ground existed for recall of the order proceeding ex parte against the JDs. They were, however, permitted to join proceedings from the stage at which the proceedings stood on the date of passing of the order.

In the meanwhile, the second JD passed away and the Executing Court directed warrants of possession to be kept in abeyance till the decision of the application filed for setting aside the order by which the JDs were proceeded against ex parte.

The petitioners’ counsel argued that Order 5 Rule 15 CPC was misconstrued by the Executing Court as to service through an adult member of the family is permissible only if there is no likelihood of the defendant being found at the residence within a reasonable time, but in the case, the Counsel argued that on the first date for service of notice, the JDs were proceeded against ex parte and thus, there was no determination of likelihood of not being found. 

Addressing this submission, the Court looked in the judgment of this Court in Charanjit Singh Mann vs. Neelam Mann, 2006(2) RCR (Civil) 497, wherein it was held that effecting service through an adult member of the family is an accepted mode of service provided the party resides at that address and there is no likelihood of his being found within a reasonable time. Applying this position to the case at hand, the Court observed that the JDs resided at the address mentioned in the summons, thus the Court was to examine whether the Executing Court took into consideration the likelihood of the JDs not being found within a reasonable time. 

The Court rejected this argument and held that it could not be said that the Executing Court did not construe Order 5 Rule 15 CPC properly.

The petitioner’s counsel argued that good cause was assigned as the application for setting aside the order proceeding against ex parte was filed just 07 months later on acquiring knowledge from the third JD and that service was not effected in person and service under Order 5 Rule 15 CPC was not proper service. To support this argument, reliance was placed upon Kuldip Kaur vs. Gurdeep Singh, 1993(3) RRR 696.

While reflecting on the difference between ‘good’ and ‘sufficient’, the Court opined that the JDs failed to put an appearance despite valid service and submission of an application after seven months could not qualify as ‘good cause’. Hence, the Court concluded that the reliance placed upon Kuldip Kaur’s Case(Supra) was misplaced.

It was also submitted that while issuing directions to the Local Commissioner to execute the sale deed, notice should have been issued to the JDs as their application for setting aside the ex parte order was pending. The Court observed that a person who is not yet a party to the execution proceedings is not entitled to be given notice. Moreover, the Court added that the order by which the Local Commissioner was directed to execute the sale deed was not under challenge and thus, the argument was rejected.

Finally, it was submitted that the balance sale consideration was deposited beyond the time fixed in the decree, thus the agreement between the parties was rescinded in view of Section 28 of the Specific Relief Act, 1963. It was argued that a right stood accrued in favour of the JDs on the date of filing of the application for setting aside the ex parte order and the same could not have been taken away.

Addressing this argument, the Court was of the opinion that Section 28 of SRA does not make it mandatory for the Court to rescind the contract upon delayed deposit of the purchase money. The court asserted that to succeed, the JDs could have filed an application for the rescission of the contract before the Court which decreed the suit. Having not done so, they cannot be permitted to raise this objection before the Executing Court, added the court. 

Thus, the revision petition was dismissed.

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