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2011 DIGILAW 104 (KAR)

Shaik Sharaff Uddin v. Abdul Karim S/o Sheikh Khalanadar Sab, Since Deceased By LRs

2011-01-25

ASHOK B.HINCHIGERI

body2011
JUDGMENT This appeal is directed against the judgment and decree passed by the court of the City Civil Judge, Bangalore in O.S. No. 7136/2009 insofar as it relates to ‘A’ schedule property. 2. The facts of the case in brief are that the appellants claim to have purchased the sites from Sued Makthiar Pasha, the general power of attorney holder of one Smt. Vazira Bi and her children. The said Smt. Vazira bi and her daughter, Razia Bi, it is claimed, got the properties in question by virtue of a registered will, dated 29/5/1981 executed by Sri Shaik Kaladar Sab. The appellants claim to have built the houses on their respective sites. They claim to have been paying the property tax to the local bodies. 3. At the other end of the spectrum, the respondent no.1 filed O.S. No.534/2002 seeking the relief of permanent injunction in respect of the lands standing at Sy.Nos.57/2 and 57/4 of Doddabettahalli village measuring 1 acre 2 guntas and measuring 16 guntas respectively. The suit was dismissed by the Trial Court by its judgment dated 17/1/2008. Thereafter, the respondent no.1 filed O.s.No.7136/2009 for partition and separate possession of the suit schedule properties. The suit culminated in the compromise under the aegis of the Mediation Centre. 4. Apprehending that the respondent no.1 may alienate the properties based on the compromise decree and the consequent change of khatah, this appeal is filed. 5. This appeal is posted for orders on the office note regarding the maintainability of the appeal. 6. Sir S.P. Shankar, the learned Senior Counsel appearing for Sri Ranga Ramu for the appellants requests that the notice be ordered to the respondents keeping open the issue of maintainability of the appeal. He submits that the appellants are not parties to the suit and hence obviously not parties to the compromise arrangement also. As the appellants have purchased the sites carved out of suit schedule ‘A’ property, their interests are required to be protected. He brings to my notice, the provisions contained in Section 96(3) of the CPC and submits that there is no legal impediment in filing the appeal to challenge the compromise decree, as the appellants have not given their consent to the same. 7. He brings to my notice, the provisions contained in Section 96(3) of the CPC and submits that there is no legal impediment in filing the appeal to challenge the compromise decree, as the appellants have not given their consent to the same. 7. The learned Senior Counsel brings to my notice the Apex Court judgment in the case of State of Punjab & others versus Amar Singh & another, reported in AIR 1974 SC 994 . The relevant paragraph of the said judgment is extracted herein below: “84. Firstly, there is a catena of authorities which, following the doctrine of Lindley, L.J., in re securities Insurance Co., (1894) 2 Ch 410 have laid down the rule that a person who is not a party to a decree or order may with the leave of the court, prefer an appeal from such decree or order if he is either bound by the order or is aggrieved by it or is prejudicially affected by it. As a rule, leave to appeal will not be refused to a person who might have been made ex nominee a party –see province of Bombay versus W.I. Automobile Association, AIR 1949 Bom 141; Heera Singh versus Verka, AIR 1958 Raj 181 and Shivaraya versus Siddamma, AIR 1963 Mys 127; Executive Officer versus Raghavan Pillai, AIR 1961 Ker 114 . In re B, an infant (1958) 1 QB 12; Govinda Menon versus Madhavan Nair, AIR 1964 Ker 235”. 8. Nextly, Sri Shankar sought to draw support from the decision of this court in the case of S.G. Thimmappa versus T. Anantha & others, reported in AIR 1986 KAR 1 , wherein it is held that the compromise decree can be challenged on the ground of fraud, undue influence or coercion. He also takes me through the Apex Court judgment in the case of Ruby Sales & Services (p) Ltd & another versus State of Maharashtra & others reported in (1994) 1 SCC 531 , wherein it is held that a consent decree can be set aside on any of the grounds on which the agreement itself can be set aside. He submits that the compromise decree does not stand on a footing higher than the agreement which preceded it; a consent decree is a mere creature of the agreement. 9. He submits that the compromise decree does not stand on a footing higher than the agreement which preceded it; a consent decree is a mere creature of the agreement. 9. Nextly, he reiles on the decision of the Patna High Court in the case of Surendra Ojha versus Mostt. Panpati Kaur & others, reported in AIR 2008 Patna 128 to advance the submission that the remedy open toe the appellants to challenge the compromise decrees is by preferring an appeal under section 96 of the CPC. 10. The question that fallsfor my consideration is: Whether a person, who is not a party to the compromise decree, is entitled to maintain the appeal? 11. To answer this question, it is necessary to refer to the provisions contained in sectiuoon96 and order XXIII rule 3A and 3B. They are extracted hereinbelow: Section 96 Appeal from original decree: (1) save where otherwise expressly provided in the body of this code or by any other law for the time being in force, an appeal shall lie from every decree passed by any court exercising original jurisdiction to the court authorized to hear appeals form the decision of such court. (2) An appeal may lie from an original decree passed ex parte (3) No appeal shall lie from a decree passed by the court with the consent of parties (4) No appeal shall lie, except on a question of law, from a decree in any suit of the nature cognizable by courts of small causes, when the amount or value of the subject matter of the original suit does not exceed ten thousand rupees. Order XXIII 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. 3B. No agreement or compromise to be entered in a representative suit without leave of court: (1) No agreement or compromise in a representative suit shall be entered into without the leave of the court expressly recorded in the proceedings; and any such agreement or compromise entered into without the leave of the court so recorded shall be void. (2) Before granting such leave, the court shall give notice in such manner as it may think fit to such persons as may appear to it to be interested in the suit. (2) Before granting such leave, the court shall give notice in such manner as it may think fit to such persons as may appear to it to be interested in the suit. Explanation – in this rule, “representative suit’ means – (a) A suit under Section 91 or Section 92 (b) A suit under rule 8 of order 1 (c) A suit in which the manager of an undivided Hindu family sues or is sued as representing the other members of the family (d) Any other suit in which the decree passed may, by virtue of the provisions of this code or of any other law for the time being in force, bind any person who is named as party to the suit. 12. Order XXIII Rule 3-A contains the prohibition that no suit can be field to challenge the compromise decree. It is inserted by Amendment Act 104 of 1976. It prohibits a suit to set aside the decree on the ground that the compromise was not lawful. After the commencement of the said amendment with effect from 1/2/1977, the only forum left to the aggrieved party for challenging the compromise decree, is the court which has passed such decree on the basis of the compromise. No independent suit challenging the compromise on the ground of fraud or otherwise is competent in view of this specific bar provided in Rule 3-A of order XXIII of CPC. Rule 3-A has been inserted only to ensure the finality of the litigation. It bars the filing of the suit for the cancellation of a compromise decree on the ground of the compromise not being lawful. 13. Rule 3-B, which is also inserted by Act 104/1976, prescribes two pre-requirements in respect of a compromise to be entered in a representative suit. Firstly, the court has to issue the notice of the compromise petition to the persons who may appear to be interested in the suit. Secondly only on considering their objections/no objection, the court would decide as to whether or not to grant the leave to the parties to enter into compromise. A compromise filed in a representative suit without complying with these requirements of the Rule 3-B is not valid and hence not binding on the persons, not parties to it; separate suit for appropriate reliefs is the remedy. A compromise filed in a representative suit without complying with these requirements of the Rule 3-B is not valid and hence not binding on the persons, not parties to it; separate suit for appropriate reliefs is the remedy. In this regard, it is also profitable to refer to the Division Bench judgment of this court in the case of Siddalingeshwar & others versus Virupaxgpuda & others reported in AIR 2003 Karnataka 407. The relevant portions of the said judgment are extracted hereinbelow: “14………a person who is not a party to the suit, cannot obviously file an application in the suit or an appeal, to challenge a compromise as being not lawful. But in a representative suit, if the court issues notices to persons interested in the suit (who are not parties to the suit) and hears them before deciding whether leave should be granted to the parties to the suit to the suit to enter into a compromise/agreement, then they would also in effect become parties to the suit and will be entitled to avail the remedies that are available to a party to the suit against a compromise or the consent decree which is not lawful. If no notice is issued to the persons interested in a representative suit and as a consequence the consent decree is void under Rule 3B, then such persons (who are not parties) will not be entitled to file an application in the suit of file an appeal under order 43 Rule 1A. Therefore, their right to bring a separate suit seeking appropriate remedy remains unaffected. We therefore hold that if Rule 3B is not complied with, while passing a decree on a compromise in a representative suit, any person who is affected by such compromise decree, but not a party to it may file a separate suit seeking appropriate relief in regard to such compromise decree, by way of declaration or otherwise. He may also file a suit for appropriate relief ignoring the compromise decree and such a suit will not be barred either by the principle or res judicata or estoppels”. 14. since the consent decree merely embodies the compromise of a contract between the parties and it is a mere creature of an agreement, the right of appeal from this decree is not provided for. 14. since the consent decree merely embodies the compromise of a contract between the parties and it is a mere creature of an agreement, the right of appeal from this decree is not provided for. The only reasonable interpretation that can be put on section 96(3) of CPC is that against a consent decree, ordinarily no appeal is maintainable. However, the provisions contained in Rule 3-A have no application for a stranger to the compromise decree. It is open to a stranger to file a suit to set aside the compromise decree. Consent decree can be set aside in the suit and not in the appeal or review. 15. In this regard, it is beneficial to refer to the Allahabad High Court’s decision in the case of Smt. Suraj Kumari versus District Judge, Mirzapur & others, reported in AIR 1991 ALL 75 . It is held therein that order XXIII Rule 3-A of CPC have no application for a stranger to the compromise decree. The relevant paragraphs of the said decision are extracted hereinbelow: “22. The petitioner’s second submission regarding the applicability of O.23, R.3-A of the code of Civil procedure is misconceived the provision is confined only to the parties to the suit. The said provision is not applicable to a stranger to the said compromise decree. A suit by stranger to set aside the compromise decree, which affects his rights is not barred by the said provision. Order 23, Rule 3-A of the Code of Civil Procedure cannot be read dehors its earlier provision of the same chapter. The said provision is only a part of the entire chapter of order 23 of the code of civil procedure which prescribes provisions for withdrawl and adjustment of the suit. Order 23, rule 3 of the code of civil procedure provides for a situation where the parties have arrived at a compromise. Order 23, rule 3 and rule 3-A of the code of civil procedure as added by Amending Act No. 104 of 1976 read together, makes it clear that a party to the suit is debarred from filing suit for setting aside compromise decree on the ground of being unlawful. Such a party has remedy by moving appropriate application before the court concerned which has passed the compromise decree. 23. Such a party has remedy by moving appropriate application before the court concerned which has passed the compromise decree. 23. The said provision does not bar the present petitioner who was not a prty to the said compromise decree to file a suit. As such there is no force in the petitioner’s contention that a suit for setting aside the compromise decree entered into between Sri Nagarmal and Smt. Paradevi was barred by O.23, R-3A of the code of civil procedure. The suit at the instance of present petitioner for setting aside compromise decree entered into between Smt. Paradevi and Sri Nagamal is maintainable in law. In support of this contention the petitioner has placed reliance on AIR 1985 Karnataka 270, Smt. Tarabai V. Krishnaswamy Rao. Since the said provision does not bar the petitioner from filing the suit the decision is of no help to the petitioner.” 16. The decision in the case of Amar Singh (supra) is rendered before Rule 3-a and 3-B were inserted to order XXIII Rule 3 of CPC. The facts of the case on hand and those of the reported decisions, on which the appellants’ side has placed its reliance, are entirely different. 17. It is also profitable to refer to the decision of the Allahabad High Court in the case of Rajeet Ram Singh & another versus Vth ADJ., Kanpur Dehat & others, reported in AIR 1999 Allahabad 189. The relevant portions of the said judgment are extracted herein below: “7….. though, however an order passed under order 23, Rule 3 may be treated to be a decree but then again Section 96(3) prohibits appeal against the decree passed by the court with the consent of the parties. Therefore, it is abundantly clear that the order passed under order 23, Rule 1 or Order 23, Rule 3 are not appealable.” 18. There is yet another aspect of the matter, which is required to be noticed. Earlier the order recording the compromise could have been challenged by way of a Misc. first appeal invoking order XLIII Rule 1(m) of CPC. The said provisions stood as follows: Order XLIII Rule 1(m) Appeal from orders – an appeal shall lie from the following orders under the provisions of section 104, namely- (m) An order under Rule 3 of Order XLIII recording or refusing to record a compromise are satisfied. 19. first appeal invoking order XLIII Rule 1(m) of CPC. The said provisions stood as follows: Order XLIII Rule 1(m) Appeal from orders – an appeal shall lie from the following orders under the provisions of section 104, namely- (m) An order under Rule 3 of Order XLIII recording or refusing to record a compromise are satisfied. 19. By Act No. 104 of 1976, the above said provisions are omitted. Therefore with effect from 1/2/1977 (the date of the commencement of Act 104/1976) filing of miscellaneous first appeal for challenging the order recording the compromise, is not permissible. The right of appeal has been abolished with a view to avoid the successive appeals concerning the very same suit. 20. The resultant position is that the remedy available to a party to the compromise decree to avoid such a consent decree is to approach the court, which recorded the compromise arrangement by making the necessary petition in the same proceedings. However, if a person is not a party to the compromise decree and/ or when it is not in a representative suit, his remedy, as held by the Division Bench in the case of Siddalingeshwar (supra) is to file a suit seeking the appropriate reliefs including the declaration that the compromise decree as against him is not enforceable, etc. 21. For yet another reason too, I am not inclined to consider this appeal on merits. Whether the appellants are the purchasers of the sites in question, whether the sites in question are carved out of suit Schedule ‘A’ property, etc. are all the disputed questions of facts, which can be resolved only on holding the trial. I am afraid the compromise decree cannot be set aside on the ipse dixit of the appellants. The appellants can seek the determination of their rights by filing a suit, in which the appellants and the respondents have to raise their pleas and adduce evidence. 22. In the result, I reject this appeal on the short ground of maintainability itself. The liberty is expressly reserved to the appellants to avail of the suit remedy. 23. No order as to costs 24. At this juncture, the learned counsel for the appellant prays for the return of the certified copies to the appellant’s side. 22. In the result, I reject this appeal on the short ground of maintainability itself. The liberty is expressly reserved to the appellants to avail of the suit remedy. 23. No order as to costs 24. At this juncture, the learned counsel for the appellant prays for the return of the certified copies to the appellant’s side. The office is directed to return the certified copies/ originals of the documents produced by the appellant’s side by taking the Xerox copies for the record purpose.