JUDGMENT:— The defendant in O. S. No 5966 of 1969 on the file of the III Assistant Judge, City Civil Court, Madras, is the appellant. The plaintiff and the defendant were carrying on business under the name style of Messrs. Grand Dresses, a firm duly constituted under the Indian Partnership Act from 14th March, 1964. The business of the firm was in the manufacture and sale of ready-made garments. There were some disputes between the parties. It was agreed that the firm was to be dissolved and that all the assets and liabilities were to be partitioned equally between the parties. The stock-in-trade was divided between them and the defendant agreed to take over the goodwill and tenancy rights relating to the office and tailoring premises on the understanding that the defendant should prepare and submit the accounts of the firm within one month ending with 10th April, 1969, and that the amount found due to the plaintiff shall have to be paid in 12 equal monthly instalments commencing from 10th April, 1969. The plaintiff and the defendant have also divided some of the movable assets like sewing machines and other articles. The plaintiff alleged that the defendant failed and neglected to finalise the accounts of the firm in spite of several demands made upon the defendant from 10th March, 1969. There were some payments made by the defendant to the plaintiff and the plaintiff claimed that in the absence of proper compliance with the understanding between the parties, the firm should be dissolved, that an account should be taken of all the assets and liabilities of the firm and that there should be division of the profits in equal moieties between the plaintiff and the defendant. There was also a prayer for appointment of a Receiver to continue the business till the share of profit and amount of goodwill is paid to the plaintiff. 2. The defendant resisted the suit. He admitted that he entered into a partnership with the plaintiff and that there was also an agreement to dissolve the firm from 10th March, 1969. He, however, disputed any agreement to become entitled to the goodwill or tenancy rights or to any agreement to prepare and submit an account of the firm within 10th April, 1969. He pleaded that in pursuance of the agreement he had made payments to the plaintiff amounting to Rs. He, however, disputed any agreement to become entitled to the goodwill or tenancy rights or to any agreement to prepare and submit an account of the firm within 10th April, 1969. He pleaded that in pursuance of the agreement he had made payments to the plaintiff amounting to Rs. 50,375, and with reference to any balance according to the defendant, the remedy was not for dissolution of the firm and for accounts, but for recovery of the amount due under the agreement. There was also an additional written statement contending that no amount was due to the plaintiff and that the sum paid after dissolution completely discharged the plaintiff. The goodwill was said to have become worthless because the plaintiff was running a competitive business under the name and style of Messrs. Eversells and the defendant was also entitled to have an account of the profits of the said business. With reference to this counter claim, the matter was provisionally valued at Rs. 100 and Court-fee paid thereon. In the reply statement filed by the plaintiff, it was contended that even according to the account produced by the defendant, a sum of Rs. 87,000 had to be paid to the plaintiff. When the deed of dissolution provided for taking of all the accounts, the accountable relationship between the plaintiff and the defendant was said to have not ceased. The plaintiff contended also that his starting a separate business after dissolution was not in any manner prohibited by the deed of dissolution. The suit for accounting was, therefore, said to be maintainable. 3. Relevant issues were framed by the trial Court and it was held that the plaintiff was entitled to the division of the profits in equal moieties, that the payments already made by the defendant to the plaintiff were true and that the plaintiff was entitled to half of the outstandings and half share in the goodwill. It was also held that the suit, as framed was maintainable. The result was, that all the issues were found in favour of the plaintiff and against the defendant and the suit was accordingly decreed as prayed for with costs. A preliminary decree for accounting was passed and a Commissioner was to be appointed for ascertaining the assets and liabilities of the firm and dividing the profits and liabilities in equal moieties. The counterclaim was dismissed. A preliminary decree for accounting was passed and a Commissioner was to be appointed for ascertaining the assets and liabilities of the firm and dividing the profits and liabilities in equal moieties. The counterclaim was dismissed. The present appeal has been filed by the defendant against the judgment of the learned trial Judge. 4. The learned counsel for the appellant contended that subsequent to the suit there was a compromise between the parties and that under the said compromise the dispute between the parties was already settled. It was, therefore, contended that in the light of the compromise, the Court below should have passed a decree based on its terms and not proceeded to pass a decree for accounting in the manner done. 5. The next contention was that as already the firm stood dissolved, there could be no question of accounting as between the plaintiff and the defendant and, therefore, the suit, as framed, was not maintainable. 6. The compromise referred to has been marked as Exhibit B-5. There was an application for recording the compromise and passing a decree in terms thereof. This application was directed to be posted along with the suit. However, there is no reference to be found in the judgment as regards the order on the interlocutory application. Under Order 23 , rule 3, Civil Procedure Code, 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 subject-matter 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 as it relates to the parties to the suit. The proviso states 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. The above provision came to be considered by Ramaprasada Rao, J., as he then was, in Palaniappa Maniyagar v. Andiappa Maniyagar1. The proviso states 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. The above provision came to be considered by Ramaprasada Rao, J., as he then was, in Palaniappa Maniyagar v. Andiappa Maniyagar1. The learned Judge held that under Order 23 , rule 3, Civil Procedure Code, the Court was bound to see whether the allegations of the parties that the suit had been adjusted wholly or in part by any lawful agreement or compromise, was true or not. In that case also, there was a petition filed under Order 23, rule 3, Civil Procedure Code, but the Court directed it to be posted along with the suit. At that stage, the matter was brought in revision and it was held that the Court misdirected itself when it refused to decide the question of adjustment between the parties in the petition under Order 23 , rule 3, Civil Procedure Code, and directed the same to be posted along with the suit The order of the trial Court in that case was set aside and the matter was remitted to that Court to decide on the evidence already on record whether the satisfaction pleaded or the adjustment put up is true or not. 7. There is an earlier decision of the Supreme Court in Silver S. Enterprises v. Devaki Nandan1.In that case, there was a tenancy agreement in relation to a cinema house. The landlord filed an application for ejectment of the tenant. That application was dismissed and when the matter was on appeal, there was an agreement under which the parties settled all their pending disputes except one appeal pending in the High Court of Punjab and Haryana. One of the disputes pending at that time was an application made by the tenant for fixing a fair rent for the cinema house in question. The agreement between the parties provided that the landlord was required to withdraw the appeal filed by him against the order dismissing his application to eject the tenant from the premises in question. The agreement also provided that the tenant should withdraw his application for fixing a fair rent for the premises. The tenant accordingly withdrew his application. The agreement between the parties provided that the landlord was required to withdraw the appeal filed by him against the order dismissing his application to eject the tenant from the premises in question. The agreement also provided that the tenant should withdraw his application for fixing a fair rent for the premises. The tenant accordingly withdrew his application. But, when the appeal in respect of the ejectment proceedings came up for hearing, the landlord refused to withdraw the same. At that stage, the tenant moved the Court to dismiss the appeal on the strength of the compromise. The High Court held that there was no provision in the Civil Procedure Code,under which an appellant could be compelled to withdraw his appeal and it, therefore, held that the compromise could not prevent the appeal being proceeded with. The Supreme Court pointed out thus: “once a dispute is validly settled out of Court, it is open to a party to a litigation to move the Court to pass a decree in accordance with the compromise. Rule 3 of Order 23, Civil Procedure Code, provides that where it is proved to the satisfaction of the Court that a suit (which expression includes an appeal) has been settled wholly or in part by any lawful agreement, the Court shall order such agreement, compromise or satisfaction to be recorded and shall pass a decree in accordance therewith so far as it relates to that suit. This is a mandatory provision”. Their Lordships expressed surprise that the High Court should have felt itself helpless under the circumstances of the case to do justice between the parties. In the compromise memo in that case it was provided that if the landlord did not carry out the terms of the compromise, he would be held responsible for all the losses of the tenant, because he had made a breach. The clause was not considered to preclude the tenant from putting forward the compromise and ask the Court to dismiss the appeal in accordance with the terms. 8. Relying on these decisions, the learned counsel rightly contended that the Court below ought to have considered the passing of a decree in terms of Exhibit B-5. It is most unfortunate that the Court below has not done so. One of the aspects adverted to by the Court below was that the compromise was executory in nature. 8. Relying on these decisions, the learned counsel rightly contended that the Court below ought to have considered the passing of a decree in terms of Exhibit B-5. It is most unfortunate that the Court below has not done so. One of the aspects adverted to by the Court below was that the compromise was executory in nature. In other words, it said something had to be done by one of the parties before the compromise was put through. This is exactly what happened in the case before the Supreme Court also. There also one the parties before the Supreme Court had to withdraw the proceedings on appeal he himself had filed. Notwithstanding the fact that the compromise was executory in nature, still the Supreme Court observed that Order 23, rule 3,Civil Procedure Code, was a mandatory requirement and the matter should have been disposed of in the light of the compromise. Therefore, the fact that the compromise requires somethings to be done by the parties did not in any manner mean that the provisions of Order 23, rule 3, Civil Procedure Code, were not attracted. It is in this sense that the matter will have to be disposed of by the Court below in accordance with law. ft will be open to the Court below to consider all the aspects as regards Exhibit B-5. 9. Another contention taken before me was that once there was dissolution, there was no question of accounting. I do not consider this plea as valid. The dissolution in the present case is not a complete dissolution, because there were some things to be done, namely, realisation of arrears, etc. Even in a case where every outstanding has already been realised, it may be necessary to find out who owes whom. Therefore, I do not find any justification for holding that because under Exhibit A-4 there was an agreement for dissolution, there was no question of any further accounting. 10. The appeal is allowed, the judgment and decree of the Court below are set aside for this purpose and the matter is remanded for fresh disposal in accordance with law. Court-fee paid on the memorandum of this appeal will be refunded to the appellant. There will be no order as to costs. S. J. ----- Appeal allowed.