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Supreme Court of India
Triloki Nath Singh vs Anirudh Singh (D) Thr. Lrs . on 6 May, 2020Author: Ajay Rastogi
Bench: A.M. Khanwilkar, S. Ravindra Bhat
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S). 3961 OF 2010
TRILOKI NATH SINGH ….APPELLANT(S)
VERSUS
ANIRUDH SINGH(D) THR. LRS & ORS. ….RESPONDENT(S)
JUDGMENT
Ajay Rastogi, J.
1. The question arises in the appeal for our consideration is as to
whether the decree passed on a compromise can be challenged by
the stranger to the proceedings in a separate suit.
2. The seminal facts which are relevant for the present purpose
and the circumstances in which it arises for our consideration are
Signature Not Verified
Digitally signed by
DEEPAK SINGH
that the appellantplaintiff filed suit before 4 th subjudge, Chapra
Date: 2020.05.06
16:03:14 IST
Reason:
seeking a declaration that the compromise decree dated 15 th
1
September, 1994 passed in Second Appeal No. 495/86 by the High
Court is illegal, inoperative and obtained by fraud and
misrepresentation and also prayed for injunction against the
respondentsdefendants restraining them from entering into
peaceful possession of the suit property.
3. The case in shorn of the appellantplaintiff is that the land
described in Schedule 1 of the plaint originally belonged to Lakhan
Singh who died leaving behind three sons, namely, Din Dayal
Singh, Jalim Singh and Kunjan Singh. Din Dayal Singh is said to
have died issueless during lifetime of his father and his other
brother, namely, Jalim Singh also died leaving behind a son Ram
Nath Singh and two daughters Sampatiya and Soniya. As regards
the third son Kunjan Singh, he is said to have died issueless but
prior to his death he gifted the land of his share to Sampatiya on
the basis of a gift deed dated 10 th July, 1978 which came on
possession over her.
4. The further case of the appellant is that one Salehari wife of
Satyanarayan Prasad claiming herself to be the daughter of late
Kunjan Singh filed a partition suit 13/78 in the Court of Munsif,
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Chapra for setting aside the aforesaid gift and for partition of her
share in the ancestral property. In that suit, Sampatiya, Dulari
Devi, Ram Nath and Soniya were impleaded as party respondents
defendants. Ram Nath died during pendency of the proceedings
and only Sampatiya contested the suit. It was further stated that
suit was dismissed and it was held that Salehari was not the
daughter of Kunjan Singh and have no right in the properties.
5. Salehari filed T.A. No. 19/84 which was dismissed on 7 th April,
1986. The further case is that a total of 3 Bigha 6 Katha 3 Dhurs
was sold by Sampatiya to appellantplaintiff for a sum of Rs.
25,000/ by a registered sale deed dated 6 th January, 1984 and put
the appellantplaintiff in possession over the suit property. In July,
1995, when respondentsdefendants started making interference in
possession of the suit property of the appellantplaintiff and on
query it revealed that it was claimed on the strength of a
compromise decree entered between Sampatiya and Salehari which
was filed in second appeal before the High Court of Patna.
6. The case of the appellantplaintiff is that the said compromise
decree was obtained by fraud and misrepresentation concealing the
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salient fact from the High Court that the sale deed was executed
much prior to the compromise being executed between the parties
to the proceedings and as such the said compromise was liable to
be declared to be void which was obtained by fraud and
misrepresentation.
7. The respondentsdefendants contested the suit on the ground
that the suit was not maintainable. It was also alleged that the suit
was hit by the provisions of Section 34 of the Specific Relief Act and
Order 23 Rule 3A Code of Civil Procedure(hereinafter being referred
to as “CPC”). It also urged that the appellantplaintiff has no right
to file the suit in the Court of SubJudge rather he ought to have
filed an application before the High Court which passed the
compromise decree and the appellantplaintiff has no right to seek
relief of injunction. That apart, it was stated to be barred by
Section 52 of Transfer of Property Act. The specific plea of the
respondentsdefendants in the written statement was that Kunjan
Singh has not died issueless rather he had a daughter namely
Salehari being his sole heir. It was also denied that he had
executed a deed of gift in favour of Sampatiya and has delivered
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possession of the gifted land to her. It was, however, conceded that
Salehari filed a partition suit no. 13/79 in which she lost,
whereafter she filed First Appeal No. 19/84 which was dismissed.
In Second Appeal No. 495/86 before the High Court, at her
instance, a compromise was executed between the parties and
accordingly, the compromise decree was passed by the High Court
dated 15th September, 1994. The extract of the terms of
compromise is reproduced ad infra:
“That the said compromise has been reached on following
terms and conditions:
(i) That the respondent no. 1(Sampatiya D/o Late
Jalim Singh) accepts that the plaintiffappellant
Salehari Devi is the daughter of Kunjan Mahto.
(ii) That respondent no. 1 accepts the alleged deed
of gift dated 10.7.1987 executed by Kunjan
Mahto in favour of respondent no. 1 is illegal,
void and inoperative and that respondent no. 1
derived neither title nor possession on account
of the said deed of gift.
(iii) That it is accepted by the respondent no. 1 that
the plaintiff appellant Salehari Devi after the
death of her father Kunjan Mahto came in
possession of his properties as she was the sole
surviving legal heir of her father,
(iv) That the plaintiffappellant accepts that she has
got only half share in the entire suit properties
and other half share belongs to respondent no. 1
Sampatiya Devi.
(v) That to remove vagueness as to which suit
properties will go to whose share, it is made
clear that scheduleI property of the plaint
which is made annexure1 containing
exhaustive details of properties will go to the
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share of plaintiff appellant and the rest of the
suit properties as described in scheduleII of the
plaint will go to the share of respondent no. 1,
(vi) That according to their respective shares the
appellant and respondent nos. 1 and 2 have
come in possession thereof.”
8. On the basis of pleadings of the parties, the learned trial
Judge in all framed 9 issues. The same are reproduced as under:
1. Is the plaintiff got any valid cause of action?
2. Is the suit as framed maintainable?
3. Is the Court fee paid sufficient?
4. Is the suit barred by limitation?
5. Is the suit u/s 34 S.R. Act.
6. Is the compromise dated 30th May, 1994 and order dated
15th September, 1994 in 2nd appeal 495/95 of the Hon’ble
High Court is illegal, inoperative and inaffective due to
fraud.
7. Is the plaintiff got right, title and interest in the suit
property?
8. Is the plaintiff entitle for decree as claimed
9. To what over relief and reliefts plaintiff to?
9. It is relevant to notice that issue nos. 4 & 5 were not pressed
and rest of the issues were decided against the appellantplaintiff
after due appreciation of the evidence on record on merits by the
trial Judge by its judgment and decree dated 31 st July, 1998 which
was challenged by the appellantplaintiff in appeal before the
learned District Judge in Title Appeal No. 80/98(3/99). On due
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appreciation of evidence on record, the appeal came to be dismissed
by the Court of Appeal by its judgment dated 5 th May, 2003 that
came to be challenged by the appellant in Second Appeal No. 153 of
2003 before the High Court which came to be dismissed at the
motion stage by judgment dated 20th April, 2009 which is a subject
matter in appeal before us.
10. Learned counsel for the appellantplaintiff submits that
provision of Order 23 Rule 3A CPC is applicable only to the parties
to the suit and the said provision does not apply to a stranger to the
compromise decree, therefore, the remedy is always open to a
stranger to the compromise decree to file a separate suit to ventilate
his grievance in the appropriate proceedings. In the given
circumstances, the High Court has committed a manifest error in
dismissing the appeal at the motion stage to nonsuit the appellant
plaintiff and make him remediless in questioning the compromise
decree which has seriously affected his right over the subject
property in question and the only remedy available with the
appellantplaintiff was to file a suit claiming his right over the
subject land in question which was created on the basis of a sale
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deed executed by one of the party to the proceedings dated 6 th
January, 1984 much before the compromise decree was passed by
the High Court.
11. Learned counsel further submits that when the previous suit
filed by Salehari was dismissed on merits on 30 th December, 1983,
thereafter on 6th January, 1984, Sampatiya sold the suit property to
the appellantplaintiff on the basis of the gift deed executed in her
favour. It was not open for Sampatiya to enter into the compromise
against her pleadings without any consideration and such an act of
Sampatiya clearly implies her collusion with Salaheri in order to
dishonestly and fraudulently defeat the rights of her vendor/the
appellant/plaintiff for no forceable reason whatsoever.
12. Per contra, learned counsel for the respondentsdefendants
while supporting the findings recorded by the High Court under the
impugned judgment submits that at least the compromise decree
which was executed between the parties was not open to question
even by the stranger to the proceedings although suit could have
been filed by the appellantplaintiff for the protection of his own
rights admissible under the law but, in the instant proceedings, suit
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was filed seeking a declaration that a compromise decree dated 15 th
September, 1994 passed in Second Appeal by the High Court of
Patna be declared to be illegal which was obtained by fraud and
misrepresentation and that was not open to the civil court for
adjudication in view of bar under Order 23 Rule 3A CPC. That
apart, the learned trial Judge on the basis of pleadings of the
parties specifically framed issue nos. 6 & 7 and recorded a finding
regarding the effect of the compromise decree dated 15 th September,
1994 passed by the High Court against the appellant. Even the
finding in reference to issue no. 7 with regard to right, title and
interest in the suit property of the appellant has been decided
against him on merits. In the given circumstances, their appears no
substance in the present appeal and deserve to be dismissed.
13. The precise question that falls for our determination is as to
whether the suit filed by the appellantplaintiff in seeking a
declaration against the decree of compromise dated 15 th September,
1994 passed by the High Court of Patna in Second Appeal was
maintainable in view of the provisions of Order 23 Rule 3 and Rule
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3A CPC. Order 23 Rule 3 and Rule 3A CPC may at this stage be
extracted for ready reference:
“3.Compromise of suit.—Where it is proved to the
satisfaction of the Court that a suit has been adjusted wholly
or in part by any lawful agreement or compromise in writing
and signed by the parties, or where the defendant satisfies
the plaintiff in respect of the whole or any part of the
subjectmatter of the suit, the Court shall order such
agreement, compromise or satisfaction to be recorded, and
shall pass a decree in accordance therewith so far it relates
to the parties to the suit, whether or not the subjectmatter
of the agreement, compromise, or satisfaction is the same as
the subjectmatter of the suit:
Provided that where it is alleged by one party and denied
by the other that an adjustment or satisfaction has been
arrived at, the Court shall decide the question; but no
adjournment shall be granted for the purpose of deciding the
question, unless the Court, for reasons to be recorded,
thinks fit to grant such adjournment.
Explanation.—An agreement or compromise which is void
or voidable under the Indian Contract Act, 1872 (9 of 1872),
shall not be deemed to be lawful within the meaning of this
Rule.
3A. Bar to suit – No suit shall lie to set aside a decree on the
ground that the compromise on which the decree is based
was not lawful.”
14. What is emerged as a legislative intent has been considered in
extenso by this Court in Pushpa Devi Bhagat(Dead) Through LR
Sadhna Rai(Smt) Vs. Rajinder Singh and Others1, after taking
note of the scheme of Order 23 Rule 3 and Rule 3A added with
1 2005(5) SCC 566
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effect from 1st February, 1977. The relevant paragraphs are as
under:
“17. The position that emerges from the amended provisions
of Order 23 can be summed up thus:
(i) No appeal is maintainable against a consent
decree having regard to the specific bar
contained in Section 96(3) CPC.
(ii) No appeal is maintainable against the order
of the court recording the compromise (or
refusing to record a compromise) in view of the
deletion of clause (m) of Rule 1 Order 43.
(iii) No independent suit can be filed for setting
aside a compromise decree on the ground that
the compromise was not lawful in view of the bar
contained in Rule 3A.
(iv) A consent decree operates as an estoppel
and is valid and binding unless it is set aside by
the court which passed the consent decree, by
an order on an application under the proviso to
Rule 3 Order 23.
Therefore, the only remedy available to a party to a consent
decree to avoid such consent decree, is to approach the
court which recorded the compromise and made a decree in
terms of it, and establish that there was no compromise. In
that event, the court which recorded the compromise will
itself consider and decide the question as to whether there
was a valid compromise or not. This is so because a consent
decree is nothing but contract between parties superimposed
with the seal of approval of the court. The validity of a
consent decree depends wholly on the validity of the
agreement or compromise on which it is made. The second
defendant, who challenged the consent compromise decree
was fully aware of this position as she filed an application for
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setting aside the consent decree on 2182001 by alleging
that there was no valid compromise in accordance with law.
Significantly, none of the other defendants challenged the
consent decree. For reasons best known to herself, the
second defendant within a few days thereafter (that is on 27
82001) filed an appeal and chose not to pursue the
application filed before the court which passed the consent
decree. Such an appeal by the second defendant was not
maintainable, having regard to the express bar contained in
Section 96(3) of the Code.
(Emphasis supplied)
15. The scope of intent of Order 23 Rule 3 and Rule 3A was
further considered by this Court in R. Rajanna Vs. S.R.
Venkataswamy and Others2 wherein this Court held as under:
“11. It is manifest from a plain reading of the above that in
terms of the proviso to Order 23 Rule 3 where one party
alleges and the other denies adjustment or satisfaction of any
suit by a lawful agreement or compromise in writing and
signed by the parties, the Court before whom such question
is raised, shall decide the same. What is important is that in
terms of Explanation to Order 23 Rule 3, the agreement or
compromise shall not be deemed to be lawful within the
meaning of the said Rule if the same is void or voidable under
the Contract Act, 1872. It follows that in every case where the
question arises whether or not there has been a lawful
agreement or compromise in writing and signed by the
parties, the question whether the agreement or compromise is
lawful has to be determined by the court concerned. What is
lawful will in turn depend upon whether the allegations
suggest any infirmity in the compromise and the decree that
would make the same void or voidable under the Contract
Act. More importantly, Order 23 Rule 3A clearly bars a suit
to set aside a decree on the ground that the compromise on
2 2014(15) SCC 471
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which the decree is based was not lawful. This implies that
no sooner a question relating to lawfulness of the agreement
or compromise is raised before the court that passed the
decree on the basis of any such agreement or compromise, it
is that court and that court alone who can examine and
determine that question. The court cannot direct the parties
to file a separate suit on the subject for no such suit will lie in
view of the provisions of Order 23 Rule 3A CPC. That is
precisely what has happened in the case at hand. When the
appellant filed OS No. 5326 of 2005 to challenge the validity
of the compromise decree, the court before whom the suit
came up rejected the plaint under Order 7 Rule 11 CPC on
the application made by the respondents holding that such a
suit was barred by the provisions of Order 23 Rule 3A CPC.
Having thus got the plaint rejected, the defendants
(respondents herein) could hardly be heard to argue that the
plaintiff (appellant herein) ought to pursue his remedy
against the compromise decree in pursuance of OS No. 5326
of 2005 and if the plaint in the suit has been rejected to
pursue his remedy against such rejection before a higher
court.”
(Emphasis supplied)
16. By introducing the amendment to the Civil Procedure
Code(Amendment) 1976 w.e.f. 1st February, 1977, the legislature
has brought into force Rule 3A to Order 23, which create bar to
institute the suit to set aside a decree on the ground that the
compromise on which decree is based was not lawful. The purpose
of effecting a compromise between the parties is to put an end to
the various disputes pending before the Court of competent
jurisdiction once and for all.
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17. Finality of decisions is an underlying principle of all
adjudicating forums. Thus, creation of further litigation should
never be the basis of a compromise between the parties. Rule 3A of
Order 23 CPC put a specific bar that no suit shall lie to set aside a
decree on the ground that the compromise on which the decree is
based was not lawful. The scheme of Order 23 Rule 3 CPC is to
avoid multiplicity of litigation and permit parties to amicably come
to a settlement which is lawful, is in writing and a voluntary act on
the part of the parties. The Court can be instrumental in having an
agreed compromise effected and finality attached to the same. The
Court should never be party to imposition of a compromise upon an
unwilling party, still open to be questioned on an application under
the proviso to Rule 3 of Order 23 CPC before the Court.
18. It can be further noticed that earlier under Order 43 Rule
1(m), an appeal which recorded the compromise and decide as to
whether there was a valid compromise or not, was maintainable
against an order under Rule 3 of Order 23 recording or refusing to
record an agreement, compromise or satisfaction. But by the
amending Act, aforesaid clause has been deleted, the result whereof
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is that now no appeal is maintainable against an order recording or
refusing to record an agreement or compromise under Rule 3 of
Order 23. Being conscious of this fact that the right of appeal
against the order recording a compromise or refusing to record a
compromise was being taken away, a new Rule 1A was added to
Order 43 which is as follows:
“1A. Right to challenge nonappealable orders in appeal
against decree.— (1) Where any order is made under this
Code against a party and thereupon any judgment is
pronounced against such party and a decree is drawn up,
such party may, in an appeal against the decree, contend
that such order should not have been made and the
judgment should not have been pronounced.
(2) In an appeal against a decree passed in a suit after
recording a compromise or refusing to record a compromise,
it shall be open to the appellant to contest the decree on the
ground that the compromise should, or should not, have
been recorded.”
19. Thus, after the amendment which has been introduced,
neither any appeal against the order recording the compromise nor
remedy by way of filing a suit is available in cases covered by Rule
3A of Order 23 CPC. As such, a right has been given under Rule
1A(2) of Order 43 to a party, who denies the compromise and invites
order of the Court in that regard in terms of proviso to Rule 3 of
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Order 23 CPC while preferring an appeal against the decree.
Section 96(3) CPC shall not be a bar to such an appeal, because it
is applicable where the factum of compromise or agreement is not
in dispute.
20. In the present case, the partition suit was filed in 1978 and
after the decision of the trial Court, the matter went in first appeal
and eventually, Second Appeal No. 495/86 before the High Court.
During the pendency of first appeal being continuation of the suit
as stated, one of the parties to the pending proceedings, namely,
Sampatiya allegedly entered into a sale deed with the appellant on
6th January, 1984. Indubitably the issue regarding right, title and
interest in respect of the land which was the subject matter of sale
deed dated 6th January, 1984, was still inchoate and not finally
decided. In that sense, the claim of the appellant was to be
governed by the decision in favour of or against Sampatiya in the
pending appeal. It must follow that the alleged transaction effected
in favour of the appellant by a sale deed dated 6 th January, 1984
ought to abide by the outcome of the said proceedings which
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culminated with the compromise decree passed by the High Court
in Second Appeal No. 495/86 dated 15 th September, 1994.
21. Indeed, the appellant was not a party to the stated
compromise decree. He was, however, claiming right, title and
interest over the land referred to in the stated sale deed dated 6 th
January, 1984, which was purchased by him from Sampatiya
judgment debtor and party to the suit. It is well settled that the
compromise decree passed by the High Court in the second appeal
would relate back to the date of institution of the suit between the
parties thereto. In the suit now instituted by the appellant, at the
best, he could seek relief against Sampatiya, but cannot be allowed
to question the compromise decree passed by the High Court in the
partition suit. In other words, the appellant could file a suit for
protection of his right, title or interest devolved on the basis of the
stated sale deed dated 6th January, 1984, allegedly executed by one
of the party(Sampatiya) to the proceedings in the partition suit,
which could be examined independently by the Court on its own
merits in accordance with law. The trial Court in any case would
17
not be competent to adjudicate the grievance of the appellant herein
in respect of the validity of compromise decree dated 15 th
September, 1994 passed by the High Court in the partition suit.
22. In other words, the appellant can only claim through his
predecessor Sampatiya, to the extent of rights and remedies
available to Sampatiya in reference to the compromise decree.
Merely because the appellant was not party to the compromise
decree in the facts of the present case, will be of no avail to the
appellant, much less give him a cause of action to question the
validity of the compromise decree passed by the High Court by way
of a substantive suit before the civil Court to declare it as
fraudulent, illegal and not binding on him. Assuming, he could
agitate about the validity of the compromise entered into by the
parties to the partition suit, it is only the High Court, who had
accepted the compromise and passed decree on that basis, could
examine the same and no other Court under proviso to Rule 3 of
Order 23 CPC. It must, therefore, follow that the suit instituted
before the civil Court by the appellant was not maintainable in view
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of specific bar under Rule 3A of Order 23 CPC as held in the
impugned judgment.
23. In the instant case, the suit was instituted in the year 1995
and 25 years have rolled by now and after the finding has been
recorded in reference to issue no. 7 regarding the right, title and
interest of the suit property against the appellant by the learned
trial Judge devolved on the basis of a stated sale deed dated 6 th
January, 1984 and not interfered by the Court of Appeal preferred
at the instance of the appellant, in the given circumstances,
remitting the matter back to the learned trial Court to examine the
suit filed at the instance of the appellantplaintiff independently for
protection of his right, title or interest being devolved on the basis of
the stated sale deed dated 6th January, 1984 which as alleged to
have been executed by one of the party to the
compromise(Sampatiya) in the changed circumstances may not
serve any purpose more so after the concurrent finding of Courts
below have been recorded against the appellantplaintiff.
24. Consequently, in our view, the appeal is without substance
and the same is accordingly dismissed. No costs.
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25. Pending application(s), if any, stand disposed of.
…………………………………..J.
(A.M. KHANWILKAR)
…………………………………..J.
(AJAY RASTOGI)
NEW DELHI
MAY 06, 2020
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