Angathal and Others vs Ramasamy and Another

Prabha Sridevan, J.—The first respondent filed O.S.No. 452 of 1986 for partition against his father Pacha Gounder who is now deceased

and his mother and sisters who are the petitioners and the second respondent herein. The first defendant Pacha Gounder alone filed his written

statement. In the written statement he denied the existence of the joint family. The third item suit property was stated to be his self-acquired

property which he was entitled to deal with as he pleased. This written statement was filed on 2.1.1987 and adopted by the other defendants who

are the petitioners and the second respondent herein. Pacha Gounder died pending suit and the plaintiff and the defendants being his legal

representatives were recognized as such.

On 19.3.1991, the suit was decreed in terms of the compromise deleting item No. 2 and declaring the right of the third petitioner and the first

respondent to 6/15 share each in item No. 1 and item No. 3 and 1/15 share each to the petitioner Nos. 1 and 2, and the third respondent. In

2002, an application was filed for setting aside the preliminary decree passed on 19.3.1991 based on the alleged compromise of the same date.

The petition was dismissed and therefore, this revision has been filed.

The learned counsel for the petitioner would submit that in 1986, the first defendant settled the property on the first petitioner herein and a

panchayat deed was entered into on 18.10.1987 whereby the parties had agreed to share the properties as per Ex.B-1. Suppressing Ex.B-1, a

compromise memo was filed into Court. So the decree passed in accordance with the same must be set aside since the parties to the compromise

memo were not aware of the contents of the compromise memo, nothing was explained to them, and the petitioners being illiterate women put their

thumb impressions on the memo without understanding the implications of the same. It was also submitted that when the counsel for the

respondent, one Mr. G. Subramaniam reported no instructions to the Court on 15.3.1990, the compromise memo signed by the same Mr. G.

Subramaniam cannot be acted upon. According to the learned counsel, the Court below completely ignored the fact that the compromise memo

had been obtained by fraud and ought not to be relied upon.

Banwari Lal Vs. Smt. Chando Devi (through L.R.) and another, , was relied on wherein the Supreme Court held that while entertaining an

application challenging a compromise memo the trial Court can consider the material in record and if it is shown that the compromise was not

lawful within the meaning of Order 23, Rule 3, CPC, the order recording compromise can be recalled.

The learned counsel for the respondent on the other hand would submit that the first defendant himself had not spoken about the settlement deed

when he filed the written statement. The parties have clearly understood the terms of the compromise and had signed the same. Even if three of the

defendants had affixed their thumb impression, the third petitioner had signed in English and cannot plead ignorance. More importantly, their lawyer

had also signed the compromise and as regards the signature of Mr. G. Subramaniam, counsel for the respondent it was submitted that if at all

anyone can be aggrieved by the counsel without any authority signing the compromise it should be the Respondent and when the respondent has

accepted that Mr. G. Subramaniam had signed as his counsel the petitioner can have no grievance.

The learned counsel for the respondent explained that on an earlier occasion the suit had been dismissed for default upon the counsel reporting

no instructions"". Thereafter the respondent contacted the counsel and since the counsel reporting ""no instructions"" cannot file the vakalat again, the

juniors in the office of Mr. G. Subramaniam filed vakalat on behalf of the respondent and when the compromise memo was signed the respondent

requested Mr. G. Subramaniam, counsel to sign since it was only the said lawyer in whom he had confidence.

The following decisions were relied on:

(a) Pulavarthi Venkata Subba Rao and Others Vs. Valluri Jagannadha Rao and Others, , in which it was held that even if a compromise decree

cannot operate as res judicata it would definitely create an estoppel by conduct.

(b) P.A. Ahammed Ibrahim Vs. The Food Corporation of India, , wherein it was stated that inherent jurisdiction cannot be invoked where the

result would be the nullification of the procedure described by the Court.

(c) Suleman Noormohamed and Others Vs. Umarbhai Janubhai, in which it was held that by recording the compromise under Order 23, Rule 3,

CPC the Court must be satisfied that the compromise was a lawful one.

(d) Muthukrishnammal Vs. Anandhalakshmi and another, , in which this Court held that a counsel is authorised by the vakalatnama to act on behalf

of the claim which includes entering into the compromise entered into by the party. On this ground, this Court held that the compromise was validly

entered and that the counsels also have the authority to enter into the compromise.

(e) In Banwari Lal Vs. Smt. Chando Devi (through L.R.) and another, , it is held as follows:

After the amendments which have been introduced, neither an appeal against the order recording the compromise nor remedy by way of filing a

suit is available in cases covered by Rule 3-A of Order 23. As such a right has been given under Rule 1-A(2) of Order 43 to a party, who

challenges the recording of the compromise, to question the validity thereof while preferring an appeal against the decree. Section 96(3) of the

Code shall not be a bar to such an appeal because Section 96(3) is applicable to cases where the factum of compromise or agreement is not in

dispute. As such a party challenging a compromise can file a petition under proviso to Rule 3 of Order 23, or an appeal u/s 96(1) of the Code, in

which he can now question the validity of the compromise in view of Rule 1-A of Order 43 of the Code.

Order 23, Rule 3, CPC, reads thus:

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 subject-

matter of the suit, the Court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance there

with so far as it relates to the parties to the suit, whether or not the subject matter of the agreement, compromise or satisfaction is the same as the

subject-matter 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:

Provided that the subject-matter of the agreement, compromise or satisfaction, in so far as it differs from the subject-matter of the suit, is within the

territo-rail and pecuniary jurisdiction of the Court concerned: Provided further that""] No. SROC3/81

3-A. 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.

In Banwari Lal Vs. Smt. Chando Devi (through L.R.) and another, , the Supreme Court observed that by virtue of the proviso and the

explanation in the Amending Act to the Civil Procedure Code, the party challenging the compromise is compelled to question the same before the

Court which had recorded the compromise. And it was that Court which was enjoined to decide the controversy whether the parties have arrived

at an adjustment in a lawful manner. The explanation made it clear that an agreement or a compromise which is void or voidable under the Indian

Contract Act shall not be deemed to be lawful within the meaning of the said Rule. The proviso along with the explanation in Rule 3 has been

introduced in order to avoid multiplicity of suit and prolonged litigation. A specific bar was prescribed by Rule 3-A in respect of institution of a

separate suit for setting aside a decree on basis of a compromise. This rule is extracted below:

3-A. 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.

It was held by the Supreme Court that a party challenging a compromise can file an application under Order 23, Rule 3 or an appeal u/s 96(1) of

the Court in which he could question the validity of the compromise in view of Rule 1(A) of Order 43 of the Court. Further it was held as follows:

The application for exercise of power under proviso to Rule 3 of Order 23 can be labelled u/s 151 of the Code but when by the amending Act

specifically such power has been vested in the Court before which the petition of compromise had been filed, the power in appropriate cases has

to be exercised under the said proviso to Rule 3. It has been held by different High Courts that even after a compromise has been recorded, the

Court concerned can entertain an application u/s 151 of the Code, questioning the legality or validity of the compromise.

Therefore, if the petitioners wanted to challenge the compromise their remedy was to file an application. This has been done in the instant case. The

submissions made by the learned counsel for the respondent that inherent jurisdiction cannot be invoked to nullify the statutory provisions does not

apply. The application filed by the petitioners is indeed maintainable.

It appears that this application was filed along with a delay petition and the delay was not condoned by the Court below. Against the said order

a revision was filed and this Court condoned the delay and directed the Court below to consider the application and pass orders on merit.

Therefore, it was submitted on behalf of the petitioners that the application cannot be rejected on the ground of laches. While the application

cannot be rejected on the ground of laches the conduct of the party will be a relevant factor in deciding the issue. That apart we have to see

whether the petitioners'' case that they did not know the implications of the compromise memo is acceptable. The xerox copy of the compromise

memo has been annexed in the typed set of papers. It is written in English. The first petitioner, the second petitioner and the second respondent

have affixed their thumb impressions. The third petitioner has signed in English they are the defendants. The Advocate for the defendants has also

signed underneath the signatures of the party. The respondent has signed as the plaintiff and Mr. G. Subramaniam has signed as Advocate for the

plaintiff. On the reverse of this joint memo the endorsement of the Presiding Officer is found,

Both the plaintiff and the defendants and their counsels were present. Parties heard. They admit the compromise memo. The compromise memo is

recorded.

The first petitioner was examined as P.W.1 and the third petitioner was examined as R.W. 2. The petitioner has denied that the Judge had

asked them whether they signed the compromise memo after reading it P.W.2 had stated that Ex.A-1 is the agreement between the parties which

was decided after the Panchayat. R.W.1 had stated that nobody had compelled the parties to sign the document and that the Presiding Officer

asked everyone whether the compromise memo was read out in Tamil and understood by the parties and that each person told the Presiding

Officer the percentage of share that they were entitled to under the memo. In cross-examination he has consistently said that it was explained to

them. R.W.2 who is the thirds petitioner herein admitted in her chief examination that the Presiding Officer explained the details of the compromise

memo and they signed it only thereafter. But in the cross-examination she had stated that she was not informed regarding the shares allotted to

each party. But at the same time she has also admitted that in 1991 she affixed her thumb impression after it was read out but that she does not

remember it now. It is seen from Paragraph No. 5 of the affidavit filed in support of this application that the Commissioner came to measure item

No. 3 of the suit property on 7.11.1992. Item No. 3 alone is the bone of contention since that was alleged to have been settled by the first

defendant on his wife, the respondent''s mother the first petitioner herein. Then again, it is alleged that in 1994, the second respondent forcibly

attempted to vacate the first petitioner from item No. 3 of the property and they came to know about the ex parte decree some time in 1996 and

yet this application though filed on 27.8.1997 is moved only in 2002. The delay in filing this application has been condoned by this Court. Yet the

conduct is unnatural. It is difficult to accept the case of the petitioner that there was fraud or the compromise decree is unlawful. They had signed

the compromise memo and though in the affidavit they have referred to the fraud committed by their then Advocate nothing has been established in

their evidence nor has any effort being taken to prove this. The Court below has considered all the grounds urged by the petitioner.

It is specifically stated that Mr. C.N. Vennal, the counsel for the petitioners is a very senior member of the Bar and the allegation that he acted

against their interest cannot be accepted especially when the averment in the affidavit has not been otherwise proved. The Court below also refers

to the endorsement of the Presiding Officer which clearly shows that the Presiding Officer had enquired the parties and was satisfied that they

admit the compromise memo.

In fact in Suleman Noormohamed and Others Vs. Umarbhai Janubhai, it is observed that,

While recording the compromise under Order 23, Rule 3 of the Code, it is not necessary for the Court to say in express terms in the order that it

was satisfied that the compromise was a lawful one. It will be presumed to have done so unless the contrary is shown.

In this case, the Presiding Officer who recorded the compromise memo has clearly recorded that the parties had admitted the compromise memo.

The ""satisfaction"" referred to in Rule 3 has been stated in fairly clear terms.

In Banwari Lal Vs. Smt. Chando Devi (through L.R.) and another, , the materials on record proved that there was fraud. But in that case, the

endorsement was ""Dismissed as per the compromise decree"". Therefore, the Supreme Court said that it was not in terms of Order 23, Rule 1,

CPC, and tested the validity of the order in terms of Order 23, Rule 3, CPC. Thereafter it was held that even if the learned Judge who recorded

the compromise had no knowledge of the fraud alleged to have been practised on the appellant by his counsel, he should not have accepted the

compromise memo since it was neither signed by the party or his counsel.

In this case, the parties had signed the compromise memo and so had the counsel. The case of fraud alleged against the counsel has not been

proved. The evidence of R.W.2 is that the Advocate Vennal got the signature from her. P.W.1 on the other hand has stated in her cross-

examination that she had given evidence in I.A.No. 35 of 1998, and that, that evidence is not true. It is indeed surprising that she should admit that

she had falsely deposed in the witness box on another occasion. She denies that her counsel was present when the matter was called and she says

that she does not know that the counsel signed after they have signed. It is difficult to believe this evidence. On a consideration of all the materials,

the recording of satisfaction by the Presiding Officer that the parties admit the compromise memo; the signature of the counsel, Mr. Vennal who is

said to be a senior member of the Bar underneath the signature of the defendants; the delay with which they had come to Court though, they knew

about the compromise memo earlier; there being no glaring illegality in the compromise memo except for the fact that the property has not been

treated as a self-acquired property as claimed by Pacha Gounder nor has it been treated as the first defendant''s individual property as alleged by

her. But it has also not been treated as ancestral property in which case, the respondent would have had 6/10 share instead of which as per the

compromise memo he gets only 6/15 share. When there is a compromise necessarily there will be deduction in some shares and an increase in

others in order to ensure peace in the family. But on this ground alone the compromise cannot be said to be unlawful. The evidence on the

petitioners side is also not reliable.

The finding of the Court below that the compromise memo had been recorded on 19.3.1991 only after the then Presiding Officer was satisfied

that the parties admitted the contents appears to be correct. The civil revision petition is therefore, dismissed. No costs. The connected

miscellaneous petition is closed.