Order XXIII Rule 3A CPC| No Suit Shall Lie To Set Aside A Decree On Ground That Compromise Based On Which Decree Is Passed Was Not Lawful: Bombay HC

The Bombay High Court observed that as per Order XXIII Rule 3A of Civil Procedure Code (CPC), no suit shall lie to set aside a decree on the ground that the compromise based on which a decree is passed, was not lawful.

The Court was deciding a first appeal filed under Section 96 of CPC that challenged the dismissal of a special civil suit.

A Division Bench comprising Justice A.S. Chandurkar and Justice Jitendra Jain held, “The aforesaid provision indicates that no suit shall lie to set aside a decree on the ground that the compromise on the basis of which the decree is passed was not lawful. A plain reading of the aforesaid provision indicates that the earlier suit should have been disposed of by passing a decree in view of a compromise entered into between the parties. In such contingency, a subsequent suit raising a challenge that the compromise recorded in the earlier suit was not lawful would not lie.”

The Bench said that dismissing the suit on the ground that the court had no jurisdiction, suffers from various legal infirmities.

Senior Advocate A.V. Anturkar represented the appellants while Advocate R.D. Soni represented the respondents.

In this case, a plea was filed by the plaintiffs claiming to be owners of the suit property by virtue of various sale deeds executed in their favour. They sought possession of the suit lands from the defendants and in the said suit, as filed in 1978, possession of the suit property was sought in favour of the plaintiffs. An alternate prayer was made that in case one of the defendants was not willing to join the plaintiffs in seeking the relief of getting actual possession of the suit properties from the defendants, then an equitable partition be effected insofar as the share of the plaintiffs was concerned.

During pendency of the said suit, the plaintiffs filed an application in 1986 under the provisions of Order VI Rule 17 of the Code praying therein that the plaint be permitted to be amended with a view to correct the description of the suit lands. The application, however, was not pressed and it was accordingly disposed of. Then another application was filed by the plaintiffs stating therein that the plaintiffs and the defendant desired to partition the properties that were the subject matter of the said suit.

The High Court in the above regard noted, “Undisputedly, in the present case the earlier suit being SCS No.268/1978 was pending when the Trial Court proceeded to decide the preliminary issue of jurisdiction in SCS No.611/1994 on 4th July 1995. SCS No.268/1978 came to be subsequently decided on 18th/20th December 1996. In fact, the Trial Court, in paragraphs 8 and 10 of the impugned order has recorded in clear terms that the earlier suit was pending when the issue of jurisdiction was being considered in the subsequent suit.”

The Court further said that since a substantive appeal being Civil Appeal challenging the decree is pending, it is not necessary to dilate further on the order passed.

“… it becomes clear that the Trial Court misdirected itself when it came to the conclusion that in view of the provisions of Order XXIII Rule 3A of the Code, the subsequent suit was not maintainable. Considering the nature of reliefs sought therein, which did not include a prayer to set aside any decree, such bar was not at all attracted”, it added.

The Court observed that on the date the subsequent suit was filed, there was no jurisdictional bar to its institution much less a bar under Order XXIII Rule 3A of the Code. It said that as per the legal position, a subsequent suit questioning the lawfulness of a compromise decree is not maintainable.

Accordingly, the High Court allowed the first appeal and quashed the order of the Civil Judge.

Cause Title- Moti Dinshaw Irani & Anr. v. Phiroze Aspandiar Irani & Ors. (Neutral Citation: 2024:BHC-AS:3858-DB)

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