Swaran Kanta v. Himachal Pradesh State Electricity Board
2013-07-23
RAJIV SHARMA
body2013
DigiLaw.ai
JUDGMENT : Rajiv Sharma, J. This Regular Second Appeal is directed against the judgment and decree dated 1.9.2001 rendered by the District Judge, Una in Civil Appeal No.113/97. 2. "Key facts" necessary for the adjudication of this Regular Second Appeal are that the appellant-plaintiff (hereinafter referred to as the "plaintiff" for convenience sake) filed a suit for possession. According to her, land measuring 231.15 square meters marked by letters A B C D E F G H I shown in red colour in the site plan comprised in Khewat No. 200, Khatauni Nos. 335 and 336, Khasra Nos. 1070 to 1073 as per Khatauni settlement for the year 1990-91 situated in village Dev Nagar, Gagret, Tehsil Amb, District Una was owned by her and defendants have no right or title over the same. She came to know in the month of April, 1993 that the defendants have encroached upon the suit land. The defendants have raised a boundary wall and shed with iron sheets. The boundary wall has been raised on the portion marked by letters A B G H and have also constructed shed with iron sheets and the portion shown by letters M K J L of the shed comes in the suit land and rest of the shed was in adjoining land of the defendants. Some pucca structure has been raised over Khasra No. 1072. The defendants were asked number of times to remove the boundary wall, but to no avail. 3. The suit was contested by the defendants. According to them, the Punjab State Electricity Board had acquired land measuring 45 kanals for the construction of 33 K.V. Sub-Station at Gagret vide award No. 1/1964 decided on 17.11.1964 and vide award No. 438 decided on 25.4.1963. The compensation was paid and the possession was also taken. 33 K.V. Sub-Station was constructed. The plaintiffs have never claimed anything over the suit land. The defendants were successors of Punjab State Electricity Board by virtue of re-organization of State Act, 1966. They were coming in possession of the suit property. The defendants in the year 1972 had installed dehydration plant by spending huge amount on labour. The possession of the defendants was open, hostile, continuous and without interruption to the knowledge of the predecessors-in-interest of the plaintiff and general public. It has ripened into ownership by way of adverse possession.
They were coming in possession of the suit property. The defendants in the year 1972 had installed dehydration plant by spending huge amount on labour. The possession of the defendants was open, hostile, continuous and without interruption to the knowledge of the predecessors-in-interest of the plaintiff and general public. It has ripened into ownership by way of adverse possession. The plaintiff has no right or title over the suit land. According to them, consolidation staff has wrongly and illegally carried out entries in favour of the predecessor-in-interest of the plaintiff and thereafter in favour of the plaintiff. The possession of the defendants was verified during the settlement. 4. The replication was filed by the plaintiff. Issues were framed by the Sub Judge 1st Class (1), Amb on 15.9.1994. Sub Judge 1st Class dismissed the suit for possession by demolition of structure and wall on 5.6.1997. However, the suit was decreed for compensation of land measuring 231.15 square meters, which was to be determined as per average price for six months from December, 1996 upto 31.5.1997. The defendants feeling aggrieved by the judgment dated 5.6.1997 preferred an appeal before the learned District Judge, Una. He allowed the same on 1.9.2001. Hence, the present Regular Second Appeal. It was admitted on the following substantial question of law on 24.5.2002: "Whether the District Judge was right in setting aside the decree and judgment of the trial court whereby compensation of the land in dispute was granted to the appellant-plaintiff on the ground that the relief granted was beyond the pleadings?" 5. Mr. R.K. Gautam, learned Senior Advocate has supported the judgment dated 5.6.1997. According to him, the suit has been decreed for compensation on the basis of the statement made by the learned counsel appearing for the defendants. In order words, the judgment is based on the statement of learned counsel for the defendants. He has further contended that the first appellate court has over looked the provisions of order 23 rule 3 of the Code of Civil Procedure. 6. Mr. Tarlok Chauhan has supported the judgment and decree of the first appellate court. 7. I have heard the learned counsel for the parties and have perused the records carefully. 8. PW-1 Bal Ram has produced the copy of map Ex.PA. 9.
6. Mr. Tarlok Chauhan has supported the judgment and decree of the first appellate court. 7. I have heard the learned counsel for the parties and have perused the records carefully. 8. PW-1 Bal Ram has produced the copy of map Ex.PA. 9. DW-1 K.P. Singh has deposed that the Punjab Electricity Board has acquired 45 kanals of land for the construction of 33 K.V. Sub-Station, Store Building and residential building in the year 1966. The H.P.S.E.B came in possession of the same. The H.P.S.E.B. has constructed dehydration plant and raised the boundary wall on the acquired land in the year 1972. The respondent-Board is treating this land as its own without any interruption. The plaintiff has no concern with the suit land. The mutation has also been attested after the award. According to him, whatever land falls within the boundary wall belongs to H.P.S.E.B. He did not know that the settlement took place in the year 1991. He has denied that the land belongs to the plaintiff. He has also denied the suggestion that the building is in unauthorized occupation of the respondent-Board. 10. The plaintiff has placed on record copy of Khatauni Ex.P-1 and copies of jamabandis Ex.P-2 and P-3 for the year 1981-82 showing the suit land and other lands belonging to her husband. The defendants have placed on record copy of Missal Hakiat Bandobast Jadid Sani Ex.D-1 for the year 1990-91, copy of jamabandi Missal Hakiat for the year 1979-80 Ex. D-2, copy of jamabandi for the year 1970-71 Ex. D-3, copy of jamabandi Missal Hakiat for the year 1979-80 Ex. D-4, copy of head note of the plaint in case No. 212/90 decided on 2.9.1996 Ex. D-5, copy of order of the Land Acquisition Collector, Punjab State Electricity Board, Patiala Ex. D-6. 11. According to the revenue records placed on record by the parties, the predecessor-in-interest of the plaintiff is recorded as owner in possession of the suit property. The defendants have not led any tangible evidence to prove adverse possession. Learned counsel appearing on behalf of the defendants had conceded before the trial court that ownership by way of adverse possession has not ripened into ownership but the possession should not be directed to be delivered to the plaintiff as the defendants have spent huge amount on the construction of wall etc.
Learned counsel appearing on behalf of the defendants had conceded before the trial court that ownership by way of adverse possession has not ripened into ownership but the possession should not be directed to be delivered to the plaintiff as the defendants have spent huge amount on the construction of wall etc. The learned trial court has held that though the plaintiff is owner of the suit land, but possession could not be handed over to the plaintiff by demolishing construction raised by the defendants. Learned counsel for the parties have submitted before the trial court that if compensation is awarded, it would meet the ends of justice. Learned counsel for the defendants had also conceded that if compensation is awarded, no loss is likely to be caused to the defendants and the defendants would pay the same. He had also submitted that in case average price of the land prevalent in the particular patwar circle is ordered to be paid that would meet ends of justice. Consequently, in view of the statement made by the learned counsel for the defendants, decree for compensation of land measuring 231.15 square meters was passed in favour of the plaintiff. The price was to be determined as per average price for six months from December, 1996 upto 31.5.1997. The defendants in the memo of appeal have not raised any objection against the concession made by their counsel. The defendants are bound by the statement made by their counsel before the trial court. Rather, the learned counsel for the defendants has also suggested the manner in which the compensation is to be determined. However, the first appellate court has reversed the judgment and decree merely only on the ground that the compromise was not reduced into writing and the suit was decreed only on the basis of the concession made at the Bar. According to the first appellate court, the compromise was required to be entered only as per the provisions of order 23 rule 3 of the Code of Civil Procedure. The first appellate court has held that the compensation decree could not be passed in favour of the plaintiff since this relief was never prayed for. The plaintiff has prayed for any other relief in the plaint. 12.
The first appellate court has held that the compensation decree could not be passed in favour of the plaintiff since this relief was never prayed for. The plaintiff has prayed for any other relief in the plaint. 12. The Division Bench of Punjab and Haryana High Court in L. Shiv Dayal Kapoor and others v. Union of India and another, AIR 1963 Punjab 538 has held that the plaintiff ought to be given such relief as he is entitled to get on the facts established upon the evidence in the case even if the plaint does not contain a specific prayer for that relief. The Division Bench has held as under: "26. In Dhani Sahu v. Bishan Prasad Singh, AIR 1942 Pat 247, Fazl Ali J., sitting in Division Bench, expressed the view that a plaintiff ought to be given such relief as he is entitled to get on the facts established upon the evidence in the case even if the plaint does not contain a specific prayer for that relief. I, therefore, allow to the plaintiffs as damages a sum of Rs. 90,977-/3/- under this head, but the plaintiffs will not be entitled to execute the decree under this head without paying court fee on the amount of Rs. 90,977/3/-. As the plaintiffs are being allowed a decree for damages for Rs. 90,977/3/- they cannot claim along with it the sum of Rs. 4,200/- on account of use of the factory at the rate of Rs. 30/- pen day per saw when it was given by respondent No. 1 for use for a period of four months three weeks from 18th of August, 1949, the date of taking over, till the date of the suit, 10th of January, 1950. The plaintiffs cannot simultaneously have relief by way of damages and also compensation for use and occupation for a particular period. The result, therefore, is that the plaintiffs suit is decreed for Rs. 2,97,694/12/- with proportionate costs." 13.
The plaintiffs cannot simultaneously have relief by way of damages and also compensation for use and occupation for a particular period. The result, therefore, is that the plaintiffs suit is decreed for Rs. 2,97,694/12/- with proportionate costs." 13. The Division Bench of Calcutta High Court in Garden Reach Shipbuilders and Engineers Staff Association and another v. Garden Reach Shipbuilders and Engineers Limited and others, AIR 1990 Calcutta 442 has held that the implied authority of an Advocate to enter into an agreement or compromise in a writ petition in which he is appearing, even without specific prior approval of his client, subject to the overriding considerations and conditions mentioned in AIR 1975 SC 2202 is not in any manner affected by the enactment of order 23 rule 3 nor is such an agreement or compromise required to be in writing and signed by the parties before it can be recorded and acted upon by the writ court. The Division Bench has held as under: "22. Apart from the aforesaid distinction and delineation or demarcation of the spheres in which the provisions of Order XXIII, Rule 3 operate, the legal position is that the said provisions do not apply verbatim et litteratim to writ petitions. Section 141 of the Code of Civil Procedure reads as follows: "141. Miscellaneous proceedings. The procedure provided in this Code in regard to suits shall be followed as far as it can be made applicable, in all proceedings, in any Court of civil jurisdiction. Explanation. In this section, the expression "proceedings" includes proceedings under Order IX, but does not include any proceeding under Article 226 of the Constitution." It is apparent, therefore, the implied authority of an Advocate (which term is used in a generic sense) to enter into an agreement or compromise in a writ petition in which he is appearing, even without specific prior approval of his client, subject to the overriding consideration and conditions mentioned in Jamilabais case AIR 1975 SC 2202 is not in any manner affected by the enactment of Order XXIII, Rule 3, as amended, nor is such an agreement or compromise required to be in writing and signed by the parties before it can be reduced and acted upon by the Writ Court.
It is open to the Writ Court of course, for its satisfaction to insist that the agreement or compromise, which the parties request it to record and act upon, should be in writing and signed by them." 14. The Apex Court in Byram Pestonji Gariwala v. Union Bank of India and others, (1992) 1 SCC 31 has held that there is no reason to assume that the legislature intended to curtail the implied authority of counsel, engaged in the thick of proceedings in court to compromise or agree on matters relating to the parties, even if such matters exceed the subject matter of the suit. The relationship of counsel and his party or the recognised agent and his principal is a matter of contract and with the freedom of contract generally, the legislature does not interfere except when warranted by public policy, and the legislative intent is expressly made manifest. The Apex Court has held as under: "28. After the amendment of 1976, a consent decree, as seen above, is executable in terms thereof even if it comprehends matters falling outside the subject-matter of the suit, but concerning the parties. The argument of the appellant's counsel is that the legislature intended that the agreement or compromise should be signed by the parties in person because the responsibility for compromising the suit, including matters falling outside its subject-matter, should be borne by none but the parties themselves. If this contention is valid, the question arises why the legislature has, presumably being well aware of the consistently followed practice of the British and Indian Courts, suddenly interfered with the time-honoured role of lawyers in the conduct of cases without specifically so stating, but by implication? Can the legislature be presumed to have fundamentally altered the position of counsel or a recognised agent, as traditionally understood in the system of law and practice followed in India and other 'common law countries' without expressly and directly so stating? There is no indication in preparatory work such as the 54th Report of the Law Commission dated 6-2-1973 or in the statement of Objects and Reasons or in the words employed by the legislature that the concept of 'agents and pleaders' of 0. Ill, C.P.C. was in any manner altered. There is no warrant for any such presumption. 29. It is rule of legal policy that laid should be altered deliberately rather than casually.
Ill, C.P.C. was in any manner altered. There is no warrant for any such presumption. 29. It is rule of legal policy that laid should be altered deliberately rather than casually. Legislature does not make radical changes in law 'by a sidewind, but only by measured and considered provisions'. (Francis Bennion's Statutory Interpretation, Butterwords, 1984, Para 133). As stated by Lord Devlin in National Assistance Board v. Wilkinson, (1952) 2 QB 648:- "It is a well-established principle of construction that a statute is not to be taken as effecting a fundamental alteration in the general law unless it uses words that point unmistakably to that conclusion". Statutes relating to remedies and procedure must receive a liberal construction 'especially so as to secure a more effective, a speedier, a simpler, and a less expensive administration of law'. See Crawford's Statutory Construction, para 254. The object of the amendment was to provide an appropriate remedy to expedite proceedings in Court. That object must be borne in mind by adopting a purposive construction of the amended provisions. The legislative intention being the speedy disposal of cases with a view to relieving the litigants and the Courts alike of the burden of mounting arrears, the word 'parties' must be so construed as to yield a beneficent result, so as to eliminate the mischief the legislature had in mind. 30. There is no reason to assume that the legislature intended to curtail the implied authority of counsel, engaged in the thick of proceedings in Court, to compromise or agree on matters relating to the parties, even if such matters exceed the subject-matter of the suit. The relationship of counsel and his party or the recognised agent and his principal is a matter of contract; and with the freedom of contract generally, the legislature does not interfere except when warranted by public policy, and the legislative intent is expressly made manifest. There is no such declaration of policy or indication of intent in the present case.
The relationship of counsel and his party or the recognised agent and his principal is a matter of contract; and with the freedom of contract generally, the legislature does not interfere except when warranted by public policy, and the legislative intent is expressly made manifest. There is no such declaration of policy or indication of intent in the present case. The legislature has not evinced any intention to change the well recognised and universally acclaimed common law tradition of an ever alert, independent and active Bar with freedom to manoeuvre with force and drive for quick action in a battle of wits typical of the adversarial system of oral hearing which is in sharp contrast to the inquisitorial traditions of the 'civil law' of France and other European and Latin American countries where written submissions have the pride of place and oral arguments are considered relatively insignificant. (See Rene David, English Law and French Law Tagore Law Lectures, 1980). 'The civil law' is indeed equally efficacious and even older, but it is the product of a different tradition, culture and language; and there is no indication whatever that Parliament was addressing itself to the task of assimilating or incorporating the rules and practices of that system into our own system of judicial administration. 37. We may, however, hasten to add that it will be prudent for counsel not to act on implied authority except when warranted by the exigency of circumstances demanding immediate adjustment of suit by agreement or compromise and the signature of the party cannot be obtained without undue delay. In these days of easier and quicker communication, such contingency may seldom arise. A wise and careful counsel will no doubt arm himself in advance with the necessary authority expressed in writing to meet all such contingencies in order that neither his authority nor Integrity is ever doubted. This essential precaution will safeguard the personal reputation of counsel as well as uphold the prestige and dignity of the legal profession. 38.
A wise and careful counsel will no doubt arm himself in advance with the necessary authority expressed in writing to meet all such contingencies in order that neither his authority nor Integrity is ever doubted. This essential precaution will safeguard the personal reputation of counsel as well as uphold the prestige and dignity of the legal profession. 38. Considering the traditionally recognised role of counsel in the common law system, and the evil sought to be remedied by Parliament by the C.P.C. (Amendment) Act, 1976, namely, attainment of certainty and expeditious disposal of cases by reducing the terms of compromise to writing signed by the parties, and allowing the compromise decree to comprehend even matters falling outside the subject-matter of the suit, but relating to the parties, the legislature cannot, in the absence of express words to such effect, be presumed to have disallowed the parties to enter into a compromise by counsel in their cause or by itself duly authorised agents. Any such presumption would be inconsistent with the legislative object of attaining quick reduction of arrears in Court by elimination of uncertainties and enlargement of the scope of compromise. 39. To insist upon the party himself personally signing the agreement or compromise would often cause undue delay, loss and inconvenience, especially in the case of non-resident persons. It has always been universally understood that a party can always act by his duly authorised representative. If a power of-attorney holder can enter into an agreement or compromise on behalf of his principal, so can counsel, possessed of the requisite authorisation by vakalatnama, act on behalf of his client. Not to recognise such capacity is not only to cause much inconvenience and loss to the parties personally, but also to delay the progress of proceedings in Court. If the legislature had intended to make such a fundamental change, even at the risk of delay, inconvenience and needless expenditure, it would have expressly so stated." 15. In the instant case also, the judgment of the trial court is by consent and the consent decree creates estoppel. 16.
If the legislature had intended to make such a fundamental change, even at the risk of delay, inconvenience and needless expenditure, it would have expressly so stated." 15. In the instant case also, the judgment of the trial court is by consent and the consent decree creates estoppel. 16. Learned Single Judge of the Punjab and Haryana High Court in Karam Chand v. Chaman Lal, 2000 (1) P.L.R. 406 has held that a lawyer has power and authority under the power of attorney granted in his favour to make a statement on behalf of his client and even to the extent of suffering a claim. Ld. Single Judge has held as under:- "9. On the contrary, counsel for the respondent relies up on AIR 1991 SC 2234 Gariwala v. Union Bank of India and Ors., in which is has been held that if a compromise has been effected in writing and is signed by counsel and may not be signed by the parties n person, the same is valid and binding on the parties and is executable and operates as res judicata even if it extends beyond subject matter of suit. The Hon'ble Supreme Court interpreted the expression 'in writing and signed by the party' occurring in Order 23 Rule 1, C.P.C. by stating that this expression also includes counsel and agent of the party and the counsel has the power to enter into compromise and this power is not curtailed by any amendment of C.P.C. Further, it was observed by the Hon'ble Supreme Court that a consent decree is binding upon the parties as a decree passed after contest if the same is not vitiated by fraud, misrepresentation, misunderstanding or mistake, such a decree has the binding force of res judicata." 17. Concept of implied consent has been explained by the learned Single Judge of Delhi High Court in Rajinder Singh and another v. Smt. Pushpa Devi Bhagat and others, AIR 2004 Delhi 228, as under: "40. The next issue is whether learned counsel for the Respondents had the authority to make the statement that he did and to enter into an understanding with the Appellants. I think this must be answered in the affirmative. 41.
The next issue is whether learned counsel for the Respondents had the authority to make the statement that he did and to enter into an understanding with the Appellants. I think this must be answered in the affirmative. 41. Justice Krishna Iyer in Shrimati Jamilabai Abdul Kadar v. Shankarlal Gulabchand, said (on page 619 of the Report): ''Those who know how courts and counsel function will need no education on the jurisprudence of lawyer's position and powers.'' 42. Nevertheless, it may be worthwhile to cite a few precedents that may further illumine the jurisprudential aspects. 43. Halsbury's Laws of England (4th edition), Volume 3 paragraph 1181 clearly states: ''The client's consent is not needed for a matter which is within the ordinary authority of counsel: thus if, in court, in the absence of the client, a compromise or settlement is entered into by counsel whose authority has not been expressly limited, the client is bound.'' 44. Lord Atkin in Sourindra Nath v. Tarubala Dasi said (on page 161 of the Report): ''Two observations may be added. First, the implied authority of counsel is not an appendage of office, a dignity added by the Courts to the status of barrister or advocate at law. It is implied in the interests of the client, to give the fullest beneficial effect to his employment of the advocate. Secondly, the implied authority can always be countermanded by the express directions of the client. No advocate has actual authority to settle a case against the express instructions of his client. If he considers such express instructions contrary to the interests of his client, his remedy is to return his brief.'' 45. In (Babu) Sheonandan Prasad Singh v. Hakim Abdul Fateh Mohammad Reza, it was said by Lord Atkin on page 121 of the Report: ''In their Lordships' experience both in this country and in India it constantly happens, indeed it may be said that it more often happens, that counsel do not take upon themselves to compromise a case without receiving express authority from their client for the particular terms; and that this position in each particular case is mutually known between the parties. In such cases the parties are relying not on implied but on an express authority given ad hoc by the client.'' 46.
In such cases the parties are relying not on implied but on an express authority given ad hoc by the client.'' 46. Over the years, the jurisprudential basis of the authority of counsel has not changed in law and the factual position also remains the same. Under the circumstances, I have no reason to doubt that learned counsel for the Respondents acted on behalf o f his clients, on instructions (whether implied or express) and in their best interests. The authority of learned counsel was not shown to have been countermanded by the Respondents. 47. There is another way of looking at the problem. Pushpa Devi Bhagat moved an application on 21st August, 2001 before the learned Civil Judge to have the decree set aside. The allegation made in the application was that her advocate had acted without instructions and authority. The application was supported by her affidavit. Less than a week later, she filed an appeal against the decree dated 18th July, 2001 before the learned District Judge. The appeal memo contained the same allegations but was not supported by an affidavit of Pushpa Devi Bhagat. The application was not pursued by her but the appeal was. I take it, therefore, that the allegations made on affidavit by Pushpa Devi Bhagat against her learned counsel were not pressed. It must follow from this that the allegation that her counsel had acted without instructions or without authority was given up or at least not followed up. Indeed, even before me, learned counsel for the Respondents did not seek to impeach the integrity of his counterpart before the learned Civil Judge. Consequently, any allegation made by the Respondents to impeach the integrity of learned counsel stood withdrawn, if not by necessary implication then by default. 48. On these facts, I think the only reasonable inference that can be drawn is that the learned counsel appearing before the learned Civil Judge did so on the authority given to him by the Respondents and he made the statement that he did on the instructions of and on the authority given to him by the Respondents" 18.
48. On these facts, I think the only reasonable inference that can be drawn is that the learned counsel appearing before the learned Civil Judge did so on the authority given to him by the Respondents and he made the statement that he did on the instructions of and on the authority given to him by the Respondents" 18. Learned Single Judge of Bombay High Court in Paul Niklav Rodrigues (deceased by L.Rs.) and another v. Anthony Domnic DSouza, AIR 2005 Bombay 114, has held that concession made in judgment, the aggrieved party can approach the judge to get it corrected and can not raise in an appeal. The Division Bench has held as under: "6. If the appellant was having any grievance about the recording of concession made by the appellant in the judgment, he ought to have approached the learned single Judge. This not having been done, in our view, the ground of limitation cannot be pressed in the appeal. Even otherwise, the said ground pertaining to S.C. Suit No. 6412/1969 being filed beyond limitation, is without any merit. The said suit was filed by Mary for a declaration of her ownership and for grant of mandatory injunction to remove the defendants from the suit property. The said suit would be covered by Article 58 read with Article 65 of the Limitation Act, 1963. Under Article 58 which relates to residual declarations, limitation period of 3 years commences when right to sue first accrued. It is well settled that right to sue under Limitation Act is said to have accrued only when there is accrual of right and there is infringement or at least clear and unequivocal threat to infringe that right. (see ,C. Mohammad Yunus v. Syed Unissa). Relief of mandatory injunction against the defendant to remove themselves as claimed by Mary in her aforesaid suit would be governed by Article 65 and in the said suit limitation would begin when possession of the defendant becomes adverse to the plaintiff. In the present case, defendant has not set up a case of adverse possession. Therefore, the period of limitation could not have begun running against the plaintiff in the said suit." 19.
In the present case, defendant has not set up a case of adverse possession. Therefore, the period of limitation could not have begun running against the plaintiff in the said suit." 19. Their Lordships of the Honble Supreme Court in Anil K. Surana and another v. State Bank of Hyderabad, AIR 2007 (10), Supreme Court Cases 257, have held that directions passed by Court on basis of statements made at the Bar amount to an executable decree by consent. 20. Their Lordships of the Honble Supreme Court in Bakshi Dev Raj (2) and another v. Sudheer Kumar, (2011) 8 SCC 679 have held that various clauses in Vaklatnama undoubtedly give power to counsel to act with utmost interest which includes to enter into a compromise or settlement and if the counsel has not acted in interest of party or against instructions of party, necessary remedy is elsewhere. Their Lordships have held as under: "25. Now, we have to consider the role of the counsel reporting to the Court about the settlement arrived at. We have already noted that in terms of Order XXIII Rule 3 of CPC, agreement or compromise is to be in writing and signed by the parties. The impact of the above provision and the role of the counsel has been elaborately dealt with by this Court in Byram Pestonji Gariwala v. Union Bank of India and Others, (1992) 1 SCC 31 and observed that courts in India have consistently recognised the traditional role of lawyers and the extent and nature of implied authority to act on behalf of their clients. Mr. Ranjit Kumar, has drawn our attention to the copy of Vakalatnama (Annexure-R3) and the contents therein. The terms appended in Vakalatnama enable the counsel to perform several acts on behalf of his client including withdraw or compromise suit or matter pending before the Court. The various clauses in the Vakalatnama undoubtedly gives power to the counsel to act with utmost interest which includes to enter into a compromise or settlement. 26. The following observations and conclusions in paras 37, 38 and 39 are relevant: "37. We may, however, hasten to add that it will be prudent for counsel not to act on implied authority except when warranted by the exigency of circumstances demanding immediate adjustment of suit by agreement or compromise and the signature of the party cannot be obtained without undue delay.
We may, however, hasten to add that it will be prudent for counsel not to act on implied authority except when warranted by the exigency of circumstances demanding immediate adjustment of suit by agreement or compromise and the signature of the party cannot be obtained without undue delay. In these days of easier and quicker communication, such contingency may seldom arise. A wise and careful counsel will no doubt arm himself in advance with the necessary authority expressed in writing to meet all such contingencies in order that neither his authority nor integrity is ever doubted. This essential precaution will safeguard the personal reputation of counsel as well as uphold the prestige and dignity of the legal profession. 38. Considering the traditionally recognised role of counsel in the common law system, and the evil sought to be remedied by Parliament by the C.P.C. (Amendment) Act, 1976, namely, attainment of certainty and expeditious disposal of cases by reducing the terms of compromise to writing signed by the parties, and allowing the compromise decree to comprehend even matters falling outside the subject matter of the suit, but relating to the parties, the legislature cannot, in the absence of express words to such effect, be presumed to have disallowed the parties to enter into a compromise by counsel in their cause or by their duly authorised agents. Any such presumption would be inconsistent with the legislative object of attaining quick reduction of arrears in court by elimination of uncertainties and enlargement of the scope of compromise. 39. To insist upon the party himself personally signing the agreement or compromise would often cause undue delay, loss and inconvenience, especially in the case of non-resident persons. It has always been universally understood that a party can always act by his duly authorised representative. If a power-of-attorney holder can enter into an agreement or compromise on behalf of his principal, so can counsel, possessed of the requisite authorisation by vakalatnama, act on behalf of his client. Not to recognise such capacity is not only to cause much inconvenience and loss to the parties personally, but also to delay the progress of proceedings in court. If the legislature had intended to make such a fundamental change, even at the risk of delay, inconvenience and needless expenditure, it would have expressly so stated." 27.
Not to recognise such capacity is not only to cause much inconvenience and loss to the parties personally, but also to delay the progress of proceedings in court. If the legislature had intended to make such a fundamental change, even at the risk of delay, inconvenience and needless expenditure, it would have expressly so stated." 27. In Jineshwardas (D) by LRs and Others v. Jagrani (Smt) and Another, (2003) 11 SCC 372 , this Court, by approving the decision taken in Byram Pestonji's case (supra), held: "that a judgment or decree passed as a result of consensus arrived at before Court, cannot always be said to be one passed on compromise or settlement and adjustment. It may, at times, be also a judgment on admission." 28. In Jagtar Singh v. Pargat Singh and Others, (1996) 11 SCC 586 , it was held that counsel for the appellant has power to make a statement on instructions from the party to withdraw the appeal. In that case, respondent No.1 therein, elder brother of the petitioner filed a suit for declaration against the petitioner and three brothers that the decree dated 04.05.1990 was null and void which was decreed by subordinate Judge, Hoshiarpur on 29.09.1993. The petitioner therein filed an appeal in the Court of Additional District Judge, Hoshiarpur. The counsel made a statement on 15.09.1995 that the petitioner did not intend to proceed with the appeal. On the basis thereof, the appeal was dismissed as withdrawn. The petitioner challenged the order of the appellate court in the revision. The High Court confirmed the same which necessitated filing of SLP before this Court. 29. Learned counsel for the petitioner contended that the petitioner had not authorised the counsel to withdraw the appeal. It was further contended that the court after admitting the appeal has no power to dismiss the same as withdrawn except to decide the matter on merits considering the legality of the reasoning of the trial Court and the conclusions either agreeing or disagreeing with it. Rejecting the said contention, the Court held as under: "3. The learned counsel for the petitioner has contended that the petitioner had not authorised the counsel to withdraw the appeal.
Rejecting the said contention, the Court held as under: "3. The learned counsel for the petitioner has contended that the petitioner had not authorised the counsel to withdraw the appeal. The Court after admitting the appeal has no power to dismiss the same as withdrawn except to decide the matter on merits considering the legality of the reasoning of the trial court and the conclusions either agreeing or disagreeing with it. We find no force in the contention. Order III Rule 4 CPC empowers the counsel to continue on record until the proceedings in the suit are duly terminated. The counsel, therefore, has power to make a statement on instructions from the party to withdraw the appeal. The question then is whether the court is required to pass a reasoned order on merits against the decree appealed from the decision of the Court of the Subordinate Judge? Order 23 Rules 1 (1) and (4) give power to the party to abandon the claim filed in the suit wholly or in part. By operation of Section 107 (2) of the CPC, it equally applies to the appeal and the appellate court has co-extensive power to permit the appellant to give up his appeal against the respondent either as a whole or part of the relief. As a consequence, though the appeal was admitted under Order 41 Rule 9, necessarily the Court has the power to dismiss the appeal as withdrawn without going into the merits of the matter and deciding it under Rule 11 thereof. 4. Accordingly, we hold that the action taken by the counsel is consistent with the power he had under Order III Rule 4 CPC. If really the counsel has not acted in the interest of the party or against the instructions of the party, the necessary remedy is elsewhere and the procedure adopted by the court below is consistent with the provisions of CPC. We do not find any illegality in the order passed by the Additional District Judge as confirmed by the High Court in the revision." 30. The analysis of the above decisions make it clear that the counsel who was duly authorised by a party to appear by executing Vakalatnama and in terms of Order III Rule 4, empowers the counsel to continue on record until the proceedings in the suit are duly terminated.
The analysis of the above decisions make it clear that the counsel who was duly authorised by a party to appear by executing Vakalatnama and in terms of Order III Rule 4, empowers the counsel to continue on record until the proceedings in the suit are duly terminated. The counsel, therefore, has power to make a statement on instructions from the party to withdraw the appeal. In such circumstance, the counsel making a statement on instructions either for withdrawal of appeal or for modification of the decree is well within his competence and if really the counsel has not acted in the interest of the party or against the instructions of the party, the necessary remedy is elsewhere. 31. Though learned counsel for the appellant vehemently submitted that the statement of the counsel before the High Court during the course of hearing of Second Appeal No. 19 of 2005 was not based on any instructions, there is no such material to substantiate the same. No doubt, Mr. Garg has placed reliance on the fact that the first appellant was bedridden and hospitalized, hence, he could not send any instruction. According to him, the statement made before the Court that too giving of certain rights cannot be sustained and beyond the power of the counsel. 32. It is true that at the relevant time, namely, when the counsel made a statement during the course of hearing of second appeal one of the parties was ill and hospitalized. However, it is not in dispute that his son who was also a party before the High Court was very much available. Even otherwise, it is not in dispute that till filing of the review petition, the appellants did not question the conduct of their counsel in making such statement in the course of hearing of second appeal by writing a letter or by sending notice disputing the stand taken by their counsel. In the absence of such recourse or material in the light of the provisions of the CPC as discussed and interpreted by this Court, it cannot be construed that the counsel is debarred from making any statement on behalf of the parties. No doubt, as pointed out in Byram Pestonji (supra), in order to safeguard the present reputation of the counsel and to uphold the prestige and dignity of legal profession, it is always desirable to get instructions in writing." 21.
No doubt, as pointed out in Byram Pestonji (supra), in order to safeguard the present reputation of the counsel and to uphold the prestige and dignity of legal profession, it is always desirable to get instructions in writing." 21. Their Lordships of the Honble Supreme Court in Mahalaxmi Cooperative Housing Society Limited and others v. Ashabhai Atmaram Patel (Dead) through LRs and others, (2013) 4 SCC 404 have held that order 23 rule 3 of the Code of Civil Procedure speaks of compromise of a suit. Order 23 rule 3 refers to distinct classes of compromise in suits. The first part refers to lawful agreement or compromise arrived at by the parties out of court, which is under the 1976 Amendment of the Code of Civil Procedure required to be in writing and signed by the parties. The second part of order 23 rule 3 deals with the cases where the defendant satisfies the plaintiff in respect of whole or a part of the suit claim which is different from the first part of order 23 rule 3. The expression "agreement" or "compromise" refers to the first part and not the second part of order 23 rule 3. The second part gives emphasis to the expression "satisfaction". The word "satisfaction" in order 23 rule 3 has been used in contradistinction to the word "adjustment" by agreement or compromise by the parties. The requirement of "in writing and signed by the parties" does not apply to the second part of order 23 rule 3 where the defendant satisfies the plaintiff in respect of whole or part of the subject matter of the suit. The proviso to order 23 rule 3 as inserted by the Amendment Act, 1976 enjoins the court to decide the question where one party alleges that the matter is adjusted by an agreement or compromise but the other party denies the allegation. Their Lordships have held as under: "39. Rule 1 of Order XXIII speaks of withdrawal of suit or abandonment of part of claim. Rule 1 of Order XXIII covers two types of cases (i) Where the plaintiff withdraws a suit or part of a claim with the permission of the Court to bring in fresh suit on the same subject matter and (ii) Where the plaintiff withdraws a suit without the permission of the Court. 40.
Rule 1 of Order XXIII covers two types of cases (i) Where the plaintiff withdraws a suit or part of a claim with the permission of the Court to bring in fresh suit on the same subject matter and (ii) Where the plaintiff withdraws a suit without the permission of the Court. 40. Rule 3 of Order XXIII, on the other hand, speaks of compromise of suit. Rule 3 of Order XXIII refers to distinct classes of compromise in suits. The first part refers to lawful agreement or compromise arrived at by the parties out of court, which is under 1976 amendment of the CPC required to be in writing and signed by the parties. The second part of Rule deals with the cases where the defendant satisfies the plaintiff in respect of whole or a part of the suit claim which is different from first part of Rule 3. The expression agreement or compromise refer to first part and not the second part of Rule 3. The second part gives emphasis to the expression satisfaction. In Pushpa Devi v. Rajinder Singh, this court has recognised that the distinction deals with the distinction between the first part and the second part. "What is the difference between the first part and second part of Rule 3? The first part refers to situations where an agreement or compromise is entered into in writing and signed by the parties. The said agreement or compromise is placed before the court. When the court is satisfied that the suit has been adjusted either wholly or in part by such agreement, or compromise in writing and signed by the parties and that it is lawful, a decree follows in terms of what is agreed between the parties. The agreement/compromise spells out the agreed terms by which the claim is admitted or adjusted by mutual concessions or promises, so that the parties thereto can be held to their promise(s) in future and performance can be enforced by the execution of the decree to be passed in terms of it. On the other hand, the second part refers to cases where the defendant has satisfied the plaintiff about the claim. This may be by satisfying the plaintiff that his claim cannot be or need not be met or performed. It can also be by discharging or performing the required obligation.
On the other hand, the second part refers to cases where the defendant has satisfied the plaintiff about the claim. This may be by satisfying the plaintiff that his claim cannot be or need not be met or performed. It can also be by discharging or performing the required obligation. Where the defendant so satisfied the plaintiff in respect of the subject-matter of the suit, nothing further remains to be done or enforced and there is no question of any enforcement or execution of the decree to be passed in terms of it." 41. Further, it is relevant to note the word satisfaction has been used in contradistinction to the word adjustment by agreement or compromise by the parties. The requirement of in writing and signed by the parties does not apply to the second part where the defendant satisfies the plaintiff in respect of whole or part of the subject-matter of the suit. 42. The proviso to Rule 3 as inserted by the Amendment Act 1976 enjoins the court to decide the question where one party alleges that the matter is adjusted by an agreement or compromise but the other party denies the allegation. The court is, therefore, called upon to decide the lis one way or the other. The proviso expressly and specifically states that the court shall not grant such adjournment for deciding the question unless it thinks fit to grant such adjournment by recording reasons." 22. In the instant case, the compromise was not required to be reduced into writing since the same would fall in the second part of order 23 rule 3 of the Code of Civil Procedure. The substantial question of law is answered accordingly. 23. Accordingly, in view of the observations and analysis made hereinabove, the Regular Second Appeal is allowed. The judgment of the first appellate court dated 1.9.2001 is set aside and the judgment of the trial court dated 5.6.1997 is restored. Pending application(s), if any, also stands disposed of. There shall, however, be no order as to costs.