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TMI Blog1988 (3) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... and confirmed as per term of the compromise. The compromise was recorded on 27.3.1979. According to the compromise the sum of Rs. 40,000 was to be paid in two installments; the first installment of Rs. 10,000 by 31-7-1979 and the remaining amount of Rs. 30,000 by 28.2.1980. The first installment was paid within time but the remaining amount was not paid. In the meantime, the decree by the High Court was formally drawn up on 6.9.1979. In view of the default in payment of the second installment the plaintiffs-appellants deposited the sum of Rs. 10,000 received by them as the first installment to the credit of the defendant No. 9 with the permission of the Court. The defendant No. 9, thereafter, made an application before the High Court on 28.8.1981 for extension of the period for payment of the second installment of Rs. 30,000. The application was allowed by the order dated 31.8.1981 which is under challenge in the present appeal. 2. Before proceeding to the points involved in the present appeal it will be useful to briefly state the facts. The parties are close relations, the defendant No. 9 (original respondent No. 1) being the uncle of the plaintiffs-appellants. He died during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s stand of their learned Counsel in the High Court, no notice was sent to the plaintiffs and the case was listed only after two days on 31.8.1981. The plaintiffs' advocate-although he did not represent them on that date-was present in Court when the case was called out, and pointed out that there was no justification for excusing the long delay. Earlier the court by its order dated 17.8.1981, after taking into consideration the conduct of the defendant No. 9 in not complying with the terms of the compromise, had permitted the plaintiffs to refund the sum of Rs. 10,000 paid to them as the first installment. The plaintiffs' counsel pointed out that the aforesaid order had finally closed the matter. The court, however, allowed the prayer of the defendant and permitted him to pay the remaining money along with an additional sum of Rs. 6,000 by way of compliance of the terms of the compromise. The counsel who was representing the plaintiffs earlier, refused to accept the money when offered, and the court permitted the defendant to deposit the amount with the Registrar of the court observing that the same would be available to be withdrawn by the plaintiffs. When the petitioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other terms of the compromise ought to be given effect to. As a result the clause that on the nonpayment of the agreed sum by the time indicated therein the decree of the trial court would become final, must be rejected as illegal. Reliance was placed on Section 74 of the Indian Contract Act. It was further argued that the position with respect to an order of a court of law made on the basis of consent of parties is also the same and it is not correct to suggest that in the circumstances of the present case the court had no power to permit the respondent No. 1 to make the deposit later. The learned Counsel relied on the observations made in Charles Hubert Kinch v. Edward Keith Walcott and Ors. AIR 1929 P.C. 289, Banku Behari Dhur v. J.C. Galstaun and Anr. AIR 1922 P.C. 339 and Jagat Singh and Ors. v. Sangat Singh and Ors. and the decision of this Court in Smt. Periyakkal and Ors. v. Smt. Dakshyani [1983]2SCR467 . It was argued that it is not right to assume that the decree of the trial court was unassailable in appeal. The respondent No. 1 had a substantial defence which he could have successfully pressed if the dispute had not been amicably settled. 7. We do not find any merit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered to be a penalty clause. The expression 'penalty' is an elastic term with many different shades of meaning but it always involves an idea of punishment. The impugned clause in the present case does not involve infliction of any punishment; it merely deprives the defendant No. 9 of a special advantage in case of default. 8. Coming to the next question as to whether the High Court acted rightly in extending the period for payment of the second installment, the learned Counsel for the parties have placed all the facts and circumstances of the case in detail in support of their respective arguments, and we have considered them closely and do not have any hesitation in holding that the High Court, assuming that it had the power to do so, was not justified in allowing the prayer of the defendant No. 9 permitting him to make a grossly belated payment. Even where such a power exists it is not to be exercised liberally. In Smt. Periyakkal and Ors. v. Smt. Dakshyani [1983]2SCR467 , relied upon by the respondents, this Court thus observed: Of course, time would not be extended ordinarily, nor for the mere asking. It would be granted in rare cases to prevent manifest injust ..... X X X X Extracts X X X X X X X X Extracts X X X X
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