Stay pending appeal is discretionary, not automatic on admission, and may be refused where delay would prejudice a sale process.

Admission of an appeal does not automatically stay execution or related proceedings under Order 41 Rule 5 of the Code of Civil Procedure, 1908; stay remains a judicial discretion to be exercised on the facts. On the facts stated, the proposed sale of the company's assets had been widely advertised, only one tender was received, delay was likely to prejudice the sale process, and no material showed that a better offer was likely. The proposed scheme was uncertain and contingent, while the principal creditor opposed postponement and supported the sale. The stay application was rejected and the sale was permitted to proceed.

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Issues: Whether stay of the proposed sale of the company's assets pending the appeal and proposed scheme should be granted, and whether the admitted appeal by itself entitled the appellant to a stay.

Analysis: Order 41, Rule 5 of the Code of Civil Procedure, 1908 embodies the principle that mere admission of an appeal does not automatically suspend the decree or the proceedings under it. The grant of stay is discretionary and must be exercised judicially on the circumstances of the case. On the facts, the proposed sale had been widely advertised, only one tender had been received, the purchaser was unwilling to wait if the sale was delayed, and the material before the Court did not establish that a higher or better offer was likely. The suggested scheme was also uncertain and depended on several contingencies, while the largest creditor opposed delay and supported the sale.

Conclusion: The appellant was not entitled to a stay of sale; the application was rejected and the sale was allowed to proceed.

Ratio Decidendi: Stay pending appeal is not automatic on admission of the appeal, but depends on a judicially exercised discretion; where no sufficient case for interference is shown and delay would prejudice the sale process and creditors, stay should be refused.

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