The Karnataka High Court has clarified that the Supreme Court direction in Asian Resurfacing of Road Agency Pvt Ltd v CBI regarding automatic lapse of stay orders after 6 months is applicable only to trial proceedings.
The SC direction is not applicable to stay on execution proceedings granted by an appellate court.
The clarification of the Court came on noticing the action of a trial court in resuming execution proceedings of a decree, despite a stay granted by the appellate court in December 2017. The trial court proceeded on the understanding that post-the SC directions, the stay of appellate order got automatically lapsed. Finding fault with the approach of the trial court, the HC observed :
"It is necessary to observe that when once a superior Appellate Court has granted stay of the operation of the judgment and decree impugned before it in an appeal, the trial court cannot insist that despite such stay of the operation of the judgment and decree, it would execute the same. In such Cases, the trial Court or any other Court subordinate to the High Court cannot insist that there has to be a further order made by the High Court continuing the stay of such orders on the expiry of six months from the date on which stay order was passed"
The same cannot be understood to mean that although the judgment and decree of a trial Court impugned before the Appellate Court is stayed by the Appellate Court, the said stay of the judgment and decree of the trial Court is only for a period of six months and on the expiry of six months, the stay would automatically stand vacated which would enable the Executing Court to continue with the executing proceedings. Such an understanding of the judgment of the Hon'ble Supreme Court and Circular issued by this Court is not proper.