Sunday 20 February 2022

Is the application for plaint of rejection is maintainable if the separate suit is filed challenging the consent decree?

 10.3 In the case of Ram Singh v. Gram Panchayat Mehal Kalan, (1986) 4 SCC 364, this Court has observed and held that when the suit is barred by any law, the plaintiff cannot be allowed to circumvent that provision by means of clever drafting so as to avoid mention of those circumstances, by which the suit is barred by law of limitation.

11. If we consider the reliefs of declaration of title, recovery of possession, cancellation of revocation of Gift Deed, declaration for DGPA and Deed of Assignment-cum-DGPA, the said reliefs can be granted only if the Compromise Decree dated 13.01.2016 passed in O.S. No.1750 of 2015 is set aside. Therefore, by asking such multiple reliefs, the plaintiff by clever drafting wants to get his suit maintainable, which otherwise would not be maintainable questioning the Compromise Decree. All the aforesaid reliefs were subject matter of earlier suits and thereafter also subject matter of

O.S. No.1750 of 2015 in which the Compromise Decree has been passed. Therefore, it is rightly held by the Trial Court that the suit in the present form and for the reliefs sought would be barred under Order XXIII Rule 3A CPC and therefore the Trial Court rightly rejected the plaint in exercise of powers under Order VII Rule 11(d) of the CPC. The High Court has erred in

setting aside the said order by entering into the merits of the validity of the Compromise Decree on the ground that the same was hit by Order XXXII Rule 7 CPC, which was not permissible at this stage of deciding the application under Order VII Rule 11 CPC and the only issue which was required to be considered by the High Court was whether the suit challenging the Compromise Decree would be maintainable or not.

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 439 OF 2022

M/s. Sree Surya Developers and Promoters Vs N. Sailesh Prasad 

Bench: M.R. SHAH; SANJIV KHANNA, JJ.

Dated: FEBRUARY 09, 2022

Author: M.R. SHAH, J.

1. Feeling aggrieved and dissatisfied with the impugned judgment and

order dated 01.10.2019 passed by the High Court for the State of

Telangana at Hyderabad in Appeal Suit No.454 of 2019 by which the High

Court has allowed the said appeal preferred by the respondent No.1 herein

– original plaintiff and has quashed and set aside the order passed by the

learned II Additional District Judge, Ranga Reddy District dated 02.05.2019

in I.A. No.108 of 2019 in O.S. No.537 of 2018 by which the learned Trial

Court rejected the plaint under Order 7 Rule 11(d) of the Civil Procedure

Code (hereinafter referred to as “CPC”), the original defendants to O.S.

No.537 of 2018 have preferred the present appeals.

2. The facts leading to the present appeals in nutshell are as under:-

2.1 That the suit schedule property was gifted to the respondent No.1

herein – original plaintiff during his minority by his paternal grandmother

(respondent No.2 herein and original defendant in O.S. No.537 of 2018)

vide registered Gift Deed dated 13.02.2003. That the said Gift Settlement

Deed was revoked vide Revocation of Gift Deed dated 10.12.2004 by the

grandmother of the respondent No.1 herein – original plaintiff. That

thereafter a registered Development Agreement-cum- General Power of

Attorney dated 18.01.2008 came to be executed between the grandmother

of the plaintiff and the appellant herein – M/s. Sree Surya Developers and

Promoters – original defendant No.2. It appears that under the said

Development Agreement, the grandmother was entitled to 35,000 sq. ft. of

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fixed saleable super built-up area along with proportionate number of car

parking spaces and undivided share in the land.

2.2 The father of the respondent No.1 – original plaintiff (original

respondent No.3 herein and defendant No.3 in O.S. No.537 of 2018) filed a

suit being O.S. No.1750 of 2015 as the next friend of then minor

respondent No.1 herein seeking for declaration that revocation of Gift Deed

dated 10.04.2004 as being illegal and not binding on the plaintiff therein

and also for perpetual injunction. Subsequently, a compromise was arrived

at between the parties to O.S. No.1750 of 2015 vide Compromise Deed

Dated 30.12.2015. Under the Compromise, it was agreed that the

respondent No.1 herein – original plaintiff would be entitled to entire 35,000

sq. ft. of the constructed area, which was agreed to be allocated to the

grandmother under the Development Agreement. It was further agreed as

per the Compromise Decree that the Developer would be entitled to assign

the development rights accrued to it under the said Development

Agreement to the third parties. In furtherance of the compromise, I.A. No.31

of 2016 under Order XXIII Rule 3 CPC came to be filed alongwith the

Compromise Memo praying for passing of decree in terms thereof. The

father of the respondent No.1 (respondent No.3 herein – original defendant

No.3) filed I.A. in the said suit under Rule 172 of the Civil Rules of Practice

seeking permission to act on behalf of the respondent No.1 herein and the

Trial Court was pleased to permit him to do so.

2.3 Thereafter, the Compromise Decree came to be passed by the VIII

Additional Senior Civil Judge, RR District dated 13.01.2016 in O.S.

No.1750 of 2015 in terms of the Memorandum of Compromise entered into

by the father on behalf of respondent No.1 herein, the grandmother and the

appellant herein – Developer. It appears that thereafter the appellant –

Developer assigned its development rights under the abovementioned

Development Agreement to respondent No.4 herein under a Deed of

Assignment dated 06.04.2016 and on the basis of the same, the

respondent No.4 has started developing the subject property in O.S.

No.537 of 2018.

2.4 That on attaining the age of majority, the respondent No.1 herein filed

the present suit being O.S. No.537 of 2018 through his General Power of

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Attorney praying inter alia declaration of right, title and interest over the suit

schedule property and declaration of Compromise Decree. He also prayed

the revocation of deed as null and void.

2.5 That having been served with a notice of the suit, the appellant filed

written statement denying all the material allegations. The appellant also

filed I.A. No.108 of 2019 under order VII Rule 11 CPC for rejection of the

plaint on various grounds and mainly on the ground that the suit for setting

aside the consent decree/Compromise Decree would be barred under

Order XXIII Rule 3A of CPC. The Trial Court vide order dated 02.05.2019

allowed the said I.A. and rejected the plaint on the ground that in view of

Order XIII Rule 3A CPC, no independent suit would be maintainable

against the Compromise Decree.

2.6 Feeling aggrieved and dissatisfied with the order passed by the Trial

Court rejecting the plaint in exercise of powers under Order VII Rule 11(d)

CPC on the ground that in view of the provisions of Order XXIII Rule 3A

CPC, no independent suit would be maintainable against the Compromise

Decree, the original plaintiff preferred the present appeal before the High

Court.

2.7 By the impugned judgment and order, the High Court has allowed the

said appeal and has quashed and set aside the order passed by the Trial

Court rejecting the plaint and has remanded the matter to the Trial Court by

observing that the effect of the provisions of Order XXXII Rules 1 to 7 CPC

has not been considered by the Trial court, which would have a direct

bearing on the validity of the Compromise Decree dated 13.01.2016 in O.S.

No.1750 of 2015.

2.8 Feeling aggrieved and dissatisfied with the impugned judgment and

order passed by the High court, the original defendant Nos. 2 and 4 –

Developer and its Assignee have preferred the present appeals.

3. Shri Mukul Rohatgi, learned Senior Advocate appearing on behalf of the

appellant – Developer has vehemently submitted that in the facts and

circumstances of the case, the High Court has committed a grave error in

quashing and setting aside the order passed by the Trial court rejecting the

plaint in exercise of powers under Order VII Rule 11 CPC holding that in

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view of Order XXIII Rule 3A CPC, no independent suit would be

maintainable against the Compromise Decree.

3.1 It is submitted that Order XXIII Rule 3 CPC provides for compromise of

suit. It is submitted that by way of amendment in 1976 made by Act No.104

of 1976, Rule 3A has been inserted, which specifically provides that 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 is submitted that therefore the

present suit filed by the respondent No.1 herein – original plaintiff

challenging the Compromise Decree would be barred under Order XXIII

Rule 3A CPC and therefore the Trial Court rightly rejected the plaint.

3.2 It is further submitted by Shri Rohatgi, learned Senior Advocate

appearing on behalf of the appellant – Developer and the learned counsel

for the Assignee that as held by this Court in a catena of decisions, the only

remedy available to the aggrieved party would be to submit an appropriate

application before the same Court which recorded the compromise.

Reliance is placed on decisions of this Court in the case of Banwari Lal

Vs. Chando Devi, (1993) 1 SCC 581; Pushpa Devi Bhagat Vs. Rajinder

Singh & Ors., (2006) 5 SCC 566; Horil Vs. Keshav, (2012) 5 SCC 525; R.

Rajanna Vs. S.R. Venkataswamy & Ors., (2014) 15 SCC 471 and

recently in R. Janakiammal Vs. S.K. Kumarasamy, (2021) 9 SCC 114.

3.3 It is submitted that in the present case as such the original plaintiff had

already filed an application under Order XXIII Rule 3A before the same

court which passed the consent Compromise Decree. It is submitted that in

the present case even the original plaintiff has filed a first appeal under

Order XLIII before the first Appellate court challenging the Compromise

Decree. It is submitted that therefore as such the plaintiff has already

availed the other remedies available to him. It is submitted that therefore

the present suit is nothing but an abuse of process of law. It is submitted

that in any case, the substantive independent suit questioning the

Compromise Decree shall not be maintainable in view of Order XXIII Rule

3A CPC.

3.4 It is further submitted by Shri Rohatgi, learned Senior Advocate

appearing on behalf of the appellant that in the present case the

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respondent No.1 herein – original plaintiff has indulged in clever drafting

seeking one relief by way of drafting multiple prayers. It is submitted that

the only relief that the plaintiff seeks is setting aside the Compromise

Decree dated 13.01.2016 which he has sought by drafting multiple prayers

in order to avoid the bar to suit envisaged under Order XXIII Rule 3A of

CPC, which in other words is mere clever drafting. It is submitted that as

held by this Court in a catena of decisions by mere clever drafting of the

plaint, the plaintiff cannot be permitted to maintain the suit, which otherwise

would not be maintainable and/or barred by any law. It is further observed

and held by this Court that if clever drafting of the plaint has created the

illusion of a cause of action, the court will nip it in the bud at the earliest so

that bogus litigation will end at the earlier stage. Reliance is placed on the

decisions of this Court in the case of T. Arivandandam Vs. T.V. Satyapal

and Anr., (1977) 4 SCC 467; Madanuri Sri Rama Chandra Murthy Vs.

Syed Jalal, (2017) 13 SCC 174; Canara Bank Vs. P. Selathal and Ors.,

(2020) 13 SCC 143; and Raghwendra Sharan Singh Vs. Ram Prasanna

Singh, (2020) 16 SCC 601.

3.5 Shri Rohatgi, learned Senior Advocate has further submitted that even

otherwise the impugned judgment and order passed by the High Court is

unsustainable. It is submitted that in the entire judgment, there is no

discussion by the High Court on the maintainability of the suit and/or any

discussion on Order XXIII Rule 3A CPC on the basis of which the Trial

Court rejected the plaint.

3.6 It is submitted that on the contrary, the High Court has gone into the

validity of the Compromise Decree considering Order XXXII Rules 1 to 7

CPC and the High Court has virtually given the findings relying upon Order

XXXII Rule 7 CPC that the Compromise Decree was not binding to the

plaintiff. It is submitted that the High Court ought to have addressed itself to

the maintainability of the suit and at this stage the High Court was not

required to consider at all on the validity of the Compromise Decree.

3.7 Number of other submissions have been made by learned counsel

appearing on behalf of the appellant on the validity of the Compromise

Decree. However, for the reasons stated hereinbelow, we propose to

consider the only issue with respect to maintainability of the suit and the

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issue before this Court is not on the validity of the Compromise Decree,

therefore, we do not propose to deal with any of the submissions on merits

on the validity of the Compromise Decree.

4. Present appeals are vehemently opposed by Shri B. Adinarayana Rao,

learned Senior Advocate appearing on behalf of the original plaintiff(s).

4.1 it is submitted that in the present case, the Compromise Decree is hit

by Order XXXII Rule 7 CPC. It is submitted that therefore on attaining the

majority immediately when respondent No.1 herein – original plaintiff

instituted a suit for various reliefs, which otherwise can be granted in a

substantive independent suit, the High Court has rightly set aside the order

passed by the Trial Court rejecting the plaint.

4.2 It is vehemently submitted by learned Senior Advocate appearing on

behalf of the original plaintiff that in the present case, the reliefs prayed in

the suit are not only with respect to the Compromise Decree, but other

reliefs are sought for which an independent substantive suit shall be

maintainable. It is submitted that as such the plaintiff has not prayed to set

aside the Compromise Decree. It is submitted that what is prayed is to

declare that the Compromise Decree is not binding on him. It is submitted

that therefore for the other reliefs sought, it can be said that an independent

suit under Order XXIII Rule 3A shall not be barred.

4.3 However, the learned Senior Advocate appearing on behalf of the

respondents – original plaintiff(s) is not disputing that the plaintiff has

already filed an application under Order XXIII Rule 3A before the same

Court, which passed the Compromise Decree. He is also not in a position

to dispute that in the said application, the plaintiff can very well make

submission on the validity of the Compromise Decree on whatever

grounds, which may be available to him including non-compliance of Order

XXXII Rule 7 CPC.

5. We have heard the learned counsel appearing on behalf of the

respective parties at length.

6. At the outset, it is required to be noted that in the present case, the Trial

Court rejected the plaint of O.S. No.537 of 2018 in exercise of powers

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under Order VII Rule 11 CPC on the ground that the said suit would not be

maintainable in view of specific bar under Order XXIII Rule 3A CPC. The

High Court by the impugned judgment and order has set aside the said

order and has remanded the matter to the Trial Court by observing that

while passing the order rejecting the plaint, the Trial Court had not

considered the provisions of Order XXXII Rules 1 to 7 CPC. However, it is

required to be noted that while passing the impugned judgment and order,

the High Court has not at all dealt with and considered the provisions of

Order XXIII Rule 3A CPC and has not considered at all whether in fact the

suit challenging the Compromise Decree and/or for the reliefs sought in the

suit would be maintainable or not. What was required to be considered by

the High Court was whether the independent suit questioning the

Compromise Decree would be maintainable or not. The aforesaid crucial

aspect has not been dealt with by the High Court at all and High Court has

gone into the validity of the Compromise Decree in view of Order XXXII

Rule 7 CPC. At the stage of deciding the application under Order VII Rule

11 CPC, the only thing which was required to be considered by the High

Court was whether the suit would be maintainable or not and that the suit

challenging the Compromise Decree would be maintainable or not in view

of Order XXIII Rule 3A CPC and at this stage, the High Court / Court was

not required to consider on merits the validity of the Compromise Decree.

7. Now, so far as the main issue whether the Trial Court rightly rejected the

plaint in exercise of powers under Order VII Rule 11 CPC on the ground

that an independent suit challenging the Compromise Decree would be

barred in view of Order XXIII Rule 3A CPC is concerned, on plain reading

of Order XXIII Rule 3A CPC, the Trial Court was justified in rejecting the

plaint. Order XXIII Rule 3A CPC, which has been inserted by amendment

in 1976 reads as under:-

“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.”

8. Therefore, on plain reading of Order XXIII Rule 3A CPC, no suit shall lie

to set aside a decree on the ground that the compromise on which the

decree is based was not lawful. Identical question came to be considered

by this Court in the case of R. Janakiammal (supra). It is observed and

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held by this Court that Rule 3A of Order XXIII bars the suit to set aside the

decree on the ground that the compromise on which decree was passed

was not lawful. It is further observed and held that an agreement or

compromise which is clearly void or voidable shall not be deemed to be

lawful and the bar under Rule 3A shall be attracted if compromise on the

basis of which the decree was passed was void or voidable. In this case,

this Court had occasion to consider in detail Order XXIII Rule 3 as well as

Rule 3A. The earlier decisions of this Court have also been dealt with by

this Court in paragraphs 53 to 57 as under:-

“53. Order 23 Rule 3 as well as Rule 3-A came for consideration before

this Court in large number of cases and we need to refer to a few of them

to find out the ratio of judgments of this Court in context of Rule 3 and Rule

3- A. In Banwari Lal v. Chando Devi, (1993) 1 SCC 581, this Court considered

Rule 3 as well as Rule 3-A of Order 23. This Court held that the object of

the Amendment Act, 1976 is to compel the party challenging the

compromise to question the court which has recorded the compromise.

In paras 6 and 7, the following was laid down: (SCC pp. 584-85)

“6. The experience of the courts has been that on many occasions parties

having filed petitions of compromise on basis of which decrees are

prepared, later for one reason or other challenge the validity of such

compromise. For setting aside such decrees suits used to be filed which

dragged on for years including appeals to different courts. Keeping in view

the predicament of the courts and the public, several amendments have

been introduced in Order 23 of the Code which contain provisions relating

to withdrawal and adjustment of suit by the Civil Procedure Code

(Amendment) Act, 1976. Rule 1 Order 23 of the Code prescribes that at

any time after the institution of the suit, the plaintiff may abandon his suit or

abandon a part of his claim. Rule 1(3) provides that where the Court is

satisfied: (a) that a suit must fail by reason of some formal defect, or (b) that

there are sufficient grounds for allowing the plaintiff to institute a fresh suit

for the subject-matter of a suit or part of a claim, it may, on such terms as it

thinks fit, grant the plaintiff permission to withdraw such suit with liberty to

institute a fresh suit. In view of Rule 1(4) if the plaintiff abandons his suit or

withdraws such suit without permission referred to above, he shall be

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precluded from instituting any such suit in respect of such subject-matter.

Rule 3 Order 23 which contained the procedure regarding compromise of

the suit was also amended to curtail vexatious and tiring litigation while

challenging a compromise decree. Not only in Rule 3 some special

requirements were introduced before a compromise is recorded by the

court including that the lawful agreement or a compromise must be in

writing and signed by the parties, a proviso with an Explanation was also

added which is as follows:

‘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.

Explanation. — An agreement or compromise which is void or voidable

under the Indian Contract Act, 1872 (9 of 1872), shall not be deemed to be

lawful within the meaning of this Rule.’

7. By adding the proviso along with an Explanation the purpose and the

object of the amending Act appears to be to compel the party challenging

the compromise to question the same before the court which had recorded

the compromise in question. That court 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 Contract Act shall not be deemed to be

lawful within the meaning of the said Rule. Having introduced the proviso

along with the Explanation in Rule 3 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 the basis of a

compromise saying:

‘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.’

54. The next judgment to be noted is Pushpa Devi Bhagat v. Rajinder Singh,

(2006) 5 SCC 566, R.V. Raveendran, J. speaking for the Court noted the

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provisions of Order 23 Rule 3 and Rule 3-A and recorded his conclusions in

para 17 in the following words: (SCC p. 576)

“17. The position that emerges from the amended provisions of Order 23

can be summed up thus:

(i) No appeal is maintainable against a consent decree having regard to the

specific bar contained in Section 96(3) CPC.

(ii) No appeal is maintainable against the order of the court recording the

compromise (or refusing to record a compromise) in view of the deletion of

clause (m) of Rule 1 Order 43.

(iii) No independent suit can be filed for setting aside a compromise decree

on the ground that the compromise was not lawful in view of the bar

contained in Rule 3-A.

(iv) A consent decree operates as an estoppel and is valid and binding

unless it is set aside by the court which passed the consent decree, by an

order on an application under the proviso to Rule 3 Order 23.

Therefore, the only remedy available to a party to a consent decree to

avoid such consent decree, is to approach the court which recorded the

compromise and made a decree in terms of it, and establish that there was

no compromise. In that event, the court which recorded the compromise

will itself consider and decide the question as to whether there was a valid

compromise or not. This is so because a consent decree is nothing but

contract between parties superimposed with the seal of approval of the

court. The validity of a consent decree depends wholly on the validity of the

agreement or compromise on which it is made. The second defendant, who

challenged the consent compromise decree was fully aware of this position

as she filed an application for setting aside the consent decree on

21-8-2001 by alleging that there was no valid compromise in accordance

with law. Significantly, none of the other defendants challenged the consent

decree. For reasons best known to herself, the second defendant within a

few days thereafter (that is on 27-8-2001) filed an appeal and chose not to

pursue the application filed before the court which passed the consent

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decree. Such an appeal by the second defendant was not maintainable,

having regard to the express bar contained in Section 96(3) of the Code.”

55. The next judgment is R. Rajanna v. S.R. Venkataswamy, (2014) 15 SCC

471 in which the provisions of Order 23 Rule 3 and Rule 3-A were again

considered. After extracting the aforesaid provisions, the following was held

by this Court in para 11: (SCC p. 474)

“11. It is manifest from a plain reading of the above that in terms of the

proviso to Order 23 Rule 3 where one party alleges and the other denies

adjustment or satisfaction of any suit by a lawful agreement or compromise

in writing and signed by the parties, the Court before whom such question

is raised, shall decide the same. What is important is that in terms of

Explanation to Order 23 Rule 3, the agreement or compromise shall not be

deemed to be lawful within the meaning of the said Rule if the same is void

or voidable under the Contract Act, 1872. It follows that in every case

where the question arises whether or not there has been a lawful

agreement or compromise in writing and signed by the parties, the question

whether the agreement or compromise is lawful has to be determined by

the court concerned. What is lawful will in turn depend upon whether the

allegations suggest any infirmity in the compromise and the decree that

would make the same void or voidable under the Contract Act. More

importantly, Order 23 Rule 3-A clearly bars a suit to set aside a decree on

the ground that the compromise on which the decree is based was not

lawful. This implies that no sooner a question relating to lawfulness of the

agreement or compromise is raised before the court that passed the decree

on the basis of any such agreement or compromise, it is that court and that

court alone who can examine and determine that question. The court

cannot direct the parties to file a separate suit on the subject for no such

suit will lie in view of the provisions of Order 23 Rule 3-A CPC. That is

precisely what has happened in the case at hand. When the appellant filed

OS No. 5326 of 2005 to challenge the validity of the compromise decree,

the court before whom the suit came up rejected the plaint under Order 7

Rule 11 CPC on the application made by the respondents holding that such

a suit was barred by the provisions of Order 23 Rule 3-A CPC. Having thus

got the plaint rejected, the defendants (the respondents herein) could

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hardly be heard to argue that the plaintiff (the appellant herein) ought to

pursue his remedy against the compromise decree in pursuance of OS No.

5326 of 2005 and if the plaint in the suit has been rejected to pursue his

remedy against such rejection before a higher court.”

56. The judgments of Pushpa Devi [Pushpa Devi Bhagat v. Rajinder Singh,

(2006) 5 SCC 566] as well as Banwari Lal [Banwari Lal v. Chando Devi, (1993)

1 SCC 581] were referred to and relied on by this Court. This Court held

that no sooner a question relating to lawfulness of the agreement or

compromise is raised before the court that passed the decree on the basis

of any such agreement or compromise, it is that court and that court alone

which can examine and determine that question.

57. In subsequent judgment, Triloki Nath Singh v. Anirudh Singh, (2020) 6

SCC 629, this Court again referring to earlier judgments reiterated the

same proposition i.e. the only remedy available to a party to a consent

decree to avoid such consent decree is to approach the court which

recorded the compromise and separate suit is not maintainable. In paras

17 and 18, the following has been laid down: (SCC p. 638)

“17. By introducing the amendment to the Civil Procedure Code

(Amendment) Act, 1976 w.e.f. 1-2-1977, the legislature has brought into

force Order 23 Rule 3-A, which creates bar to institute the suit to set aside

a decree on the ground that the compromise on which decree is based was

not lawful. The purpose of effecting a compromise between the parties is to

put an end to the various disputes pending before the court of competent

jurisdiction once and for all.

18. Finality of decisions is an underlying principle of all adjudicating forums.

Thus, creation of further litigation should never be the basis of a

compromise between the parties. Rule 3-A Order 23 CPC put a specific bar

that no suit shall lie to set aside a decree on the ground that the

compromise on which the decree is based was not lawful. The scheme of

Order 23 Rule 3 CPC is to avoid multiplicity of litigation and permit parties

to amicably come to a settlement which is lawful, is in writing and a

voluntary act on the part of the parties. The court can be instrumental in

having an agreed compromise effected and finality attached to the same.

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The court should never be party to imposition of a compromise upon an

unwilling party, still open to be questioned on an application under the

proviso to Order 23 Rule 3 CPC before the court.”

That thereafter it is specifically observed and held that a party to a consent

decree based on a compromise to challenge the compromise decree on

the ground that the decree was not lawful i.e., it was void or voidable has to

approach the same court, which recorded the compromise and a separate

suit challenging the consent decree has been held to be not maintainable.

9. In view of the above decisions of this Court, the Trial Court was

absolutely justified in rejecting the plaint on the ground that the suit for the

reliefs sought challenging the Compromise Decree would not be

maintainable.

10. Now, so far as the submission on behalf of the plaintiff that in the suit

the plaintiff has not specifically prayed for setting aside the Compromise

Decree and what is prayed is to declare that the Compromise Decree is not

binding on him and that for the other reliefs sought, the suit would not be

barred and still the suit would be maintainable is concerned, the aforesaid

cannot be accepted.

10.1 As held by this Court in a catena of decisions right from 1977 that a

mere clever drafting would not permit the plaintiff to make the suit

maintainable which otherwise would not be maintainable and/or barred by

law. It has been consistently held by this Court that if clever drafting of the

plaint has created the illusion of a cause of action, the court will nip it in the

bud at the earliest so that bogus litigation will end at the earlier stage.

10.2 In the case of T. Arivandandam Vs. T.V. Satyapal, (1977) 4 SCC

467, it is observed and held as under;-

“5. We have not the slightest hesitation in condemning the petitioner for the

gross abuse of the process of the court repeatedly and unrepentantly

resorted to. From the statement of the facts found in the judgment of the

High Court, it is perfectly plain that the suit now pending before the First

Munsif's Court, Bangalore, is a flagrant misuse of the mercies of the law in

receiving plaints. The learned Munsif must remember that if on a

meaningful — not formal — reading of the plaint it is manifestly vexatious,

and meritless, in the sense of not disclosing a clear right to sue, he should

exercise his power under Order 7 Rule 11 CPC taking care to see that the

ground mentioned therein is fulfilled. And, if clever drafting has created the

illusion of a cause of action, nip it in the bud at the first hearing by

examining the party searchingly under Order 10 CPC. An activist Judge is

the answer to irresponsible law suits.”

10.3 In the case of Ram Singh v. Gram Panchayat Mehal Kalan, (1986) 4

SCC 364, this Court has observed and held that when the suit is barred by

any law, the plaintiff cannot be allowed to circumvent that provision by

means of clever drafting so as to avoid mention of those circumstances, by

which the suit is barred by law of limitation.

11. If we consider the reliefs of declaration of title, recovery of possession,

cancellation of revocation of Gift Deed, declaration for DGPA and Deed of

Assignment-cum-DGPA, the said reliefs can be granted only if the

Compromise Decree dated 13.01.2016 passed in O.S. No.1750 of 2015 is

set aside. Therefore, by asking such multiple reliefs, the plaintiff by clever

drafting wants to get his suit maintainable, which otherwise would not be

maintainable questioning the Compromise Decree. All the aforesaid reliefs

were subject matter of earlier suits and thereafter also subject matter of

O.S. No.1750 of 2015 in which the Compromise Decree has been passed.

Therefore, it is rightly held by the Trial Court that the suit in the present

form and for the reliefs sought would be barred under Order XXIII Rule 3A

CPC and therefore the Trial Court rightly rejected the plaint in exercise of

powers under Order VII Rule 11(d) of the CPC. The High Court has erred in

setting aside the said order by entering into the merits of the validity of the

Compromise Decree on the ground that the same was hit by Order XXXII

Rule 7 CPC, which was not permissible at this stage of deciding the

application under Order VII Rule 11 CPC and the only issue which was

required to be considered by the High Court was whether the suit

challenging the Compromise Decree would be maintainable or not.

12. As observed hereinabove and it is not in dispute that as such the

respondent No.1 – original plaintiff has already moved an appropriate

application before the concerned Court, which passed the decree setting

aside the compromise Decree by submitting an application under Order

XXIII Rule 3A CPC therefore the said application will have to be decided

and disposed of in accordance with law in which all the defences /

contentions which may have been available to the respective parties on the

validity of the Compromise Decree would have to be gone into by the

concerned court in accordance with law and on its own merits.

13. In view of the above and for the reasons stated above, the present

appeals succeed. The impugned judgment and order passed by the High

Court allowing the appeal and quashing and setting aside the order passed

by the II Additional District Judge, Ranga Reddy District passed on

02.05.2019 in I.A. No. 108 of 2019 in O.S. No.537 of 2018 is hereby

quashed and set aside. The order passed by the Trial Court dated

02.05.2019 in I.A. No.108 of 2019 in O.S. No. 537 of 2018 rejecting the

plaint is hereby restored. However, it is observed that we have not

expressed anything on merits on validity of the Compromise Decree and

the same shall have to be decided and considered by the Court which

passed the decree in an application under Order XXIII Rule 3A CPC, which

as observed hereinabove has been filed by the original plaintiff and the said

application be decided and disposed of by the concerned Court in

accordance with law and on its own merits and the contentions/defences

which may be available to the respective parties on the validity of the

Compromise Decree are kept open to be considered by the concerned

Court in accordance with law and on its own merits.

Present appeals are allowed accordingly. However, in the facts and

circumstances of the case, there shall be no order as to costs.

Pending application(s), if any, also stand disposed of.


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