Inder Kumar Kathuria v. Krishan Kumar Kathuria & Ors

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 3A.

(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 of 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 RFA (OS) 98/2013 Page 15

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 decree. Such an appeal by second defendant was not maintainable, having regard to the express bar contained in Section 96(3) of the Code."

¶21The present case is one of an appeal against a decree passed by consent, where the decree itself is being challenged. In such cases, as the Supreme Court's dictum clearly notes, the remedy is to approach the Court which recorded the compromise itself to set aside the decree, rather than to approach the appellate Court, a remedy which has been, by statutory amendment, removed. In this case, after the order of 10th November, 2004, the plaintiff raised several pleas regarding whether a decree was in fact passed in the execution application preferred by the first defendant. The question was argued by counsel and considered by the learned Single Judge in great detail, holding that the order of 10th November, 2004 was in fact a decree. The plaintiff further entered appearance in proceedings before the Appellate Court in those proceedings, and for reasons best known to him, did not challenge the validity of the compromise itself before the learned Single Judge who recorded it. Indeed, till date, no such application to recall, or reconsider, the compromise has been moved before the learned Single RFA (OS) 98/2013 Page 16

Judge. Moreover, as the plaintiff admits that there was a compromise recorded on 10th November, 2004, neither is this a case where "there is a contest on the question whether there was a compromise or not", such that "a decree accepting the compromise on resolution of that controversy, cannot be said to be a decree passed with the consent of the parties," in which case the bar under Section 96 would not apply. (see, Kishun @ Ram Kishun (Dead) through LRs v. Bihari (D) by LRs, (2005) 6 SCC 300, paragraph 6)

¶22In any case, the order of the learned Single Judge in Execution Petition 400/2008, has now attained finality, with the appeal having been disposed off by an order dated 22.03.2012, leading to a revival of the said order. The learned Single Judge, in paragraphs 11-22, considered the very question of whether the compromise in this case, and the order of 10th November, 2004, can be called a decree or not, and whether execution proceedings in respect of that order are maintainable. In considering the arguments raised by the plaintiff, the learned Single Judge concluded that the order was a decree under the terms of Section 2(2), CPC. Given those findings, which have not been challenged, that issue is thereby decided against the plaintiff. As regards the argument that the compromise is void for failure to disclose a consideration, this Court notices that the compromise was presented by way of a joint application, i.e. it was in writing, and was recorded in the presence of the parties, without any protest. While the Court recording the decree must entertain caution in recording such a compromise under Order XXIII CPC, which is then translated into a decree of the Court, and not just a settlement between the parties, once the parties have accepted such a compromise settling their rights and liabilities, the plea that the settlement be rescinded does not lie. Indeed, this is why the safeguards under Order XXIII, which were met in RFA (OS) 98/2013 Page 17

this case, are crucially important (i.e. settlement in writing and signed by the parties, or their authorized representatives). Moreover, it is an established principle of law that the Court will not go behind a contractual agreement between the parties, and ascertain the adequacy of consideration. Rather, the fact that some consideration flowed to either party is sufficient to uphold the contractual arrangement. A reading of the compromise reflected in the joint application of parties in this case clearly shows that both parties have rights and obligations – while the first defendant does receive 29% of the sale proceeds/ownership of the 1st Floor, the agreement records his liability to pay water and electricity charges, and crucially, settles the rights of parties in proportion (71% for the plaintiff, and 29% for the first defendant) finally as opposed to the first defendant contesting this question at trial in the suit. Moreover, the Court also notices that this is the first time since 10th November, 2004 - after a period of one decade, that a plea of lack on consideration has been raised, almost as an afterthought to bypass a compromise freely and voluntarily recorded between the parties-an instance of clear abuse of the judicial process.

¶23Thus, for the above reasons, the appeal is without merit. The same is accordingly dismissed. In the circumstances, the appellant is to bear the costs of `50,000 (Rupees fifty thousand) to be paid to the respondents within four weeks.

S. RAVINDRA BHAT (JUDGE)

NAJMI WAZIRI (JUDGE) OCTOBER 3, 2013

RFA (OS) 98/2013 Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI Decided on: 03.10.2013 + RFA (OS) 98/2013, C.M. NO.12524/2013 INDER KUMAR KATHURIA ..... Appellant Through: Sh. Sanjay Jain, Sr. Advocate with Sh. Manish. K. Jha, Ms. Prabhsahay Kaur and Ms. Aastha Jain, Advocates. versus KRISHAN KUMAR KATHURIA & ORS. ..... Respondents Through: Sh. Gurmehar. S. Sistani with Sh. Arjun Syal, Advocates. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI MR. JUSTICE S. RAVINDRA BHAT (OPEN COURT) % 1. The present appeal is filed against a decree dated 08.04.2004, which was drawn-up pursuant to an order of this Court in I.A. No. 7595/2004 in CS(OS) 90/2004. Before entering the details of that order, a background of the dispute between the parties is necessary. The plaintiff in CS(OS) 90/2004, and the appellant herein, is the sole registered owner of property bearing No. D-133, East of Kailash, New Delhi (hereinafter "the property in question"), which was given as a perpetual lease by the President of India through a deed dated 27.10.1973, for a sum of ` 48,000/-, registered in the Office of the Sub-Registrar, Delhi on 09.01.1974. This property comprises a ground floor, first floor, mezzanine and second floor. While the plaintiff is in possession of the ground floor, the first floor is occupied by the first defendant, his brother, along with his wife, Mrs. Veena Kathuria, and their two sons, Mr. Amit Kathuria and Arjun Kathuria. 2. The plaintiff claimed that since his brother, Krishan Kumar Kathuria, the first defendant was a bachelor and had no reasonable residential accommodation in the year 1976, the plaintiff permitted him (i.e. his RFA (OS) 98/2013 Page 2 brother) to occupy the first floor of the property in question. Subsequently, it is claimed that on the plaintiff's request to vacate the property since he required it for his own purposes (after this son got married and required the first floor, it is claimed, to reside with his wife), the first defendant agreed, but never acted upon his promise to vacate the premises. Thus, it is claimed that the plaintiff then filed CS(OS) 90/2004 for possession and mesne profits against the first defendant and his three family members (i.e. wife and two sons) in respect of the first floor of the property in question. It is also stated that in December, 2001, the first defendant openly refused to vacate the suit property, unless the plaintiff bought him a first floor flat having the same built-up area as the property in question at any other location in South Delhi. As a consequence, the plaintiff submitted that the occupation of the first floor by the four defendants/respondents herein is unauthorized. 3. During the pendency of the proceedings, the parties represented to the Court that a compromise had been arrived at, whereby their disputes were settled. The suit was, therefore, disposed off in terms of a compromise recorded by the parties, presented to the Court as a joint application under Order XXIII Rule 3, Code of Civil Procedure ("CPC") in I.A. No 7595/2004. That order of 10.11.2004 held as follows: "This is a joint application under Order XXIII Rule 3 read with Section 151 CPC moved on behalf of the parties praying for recording settlement and satisfaction reached between the parties in relation to the subject matter of the suit. The application is supported by the affidavit of Mr. Krishan Kumar Kathuria – Defendant No.1, Ms. Veena Kathuria – defendant No. 2, Mr. Amit Kathuria defendant No.3 and Mr. Arjun Kathuria – defendant No.4. Parties are present in the Court and they fully affirm to the contents of the application. Accordingly the application is allowed, the compromise reached between the parties is taken on record and the suit of RFA (OS) 98/2013 Page 3 the plaintiff is disposed of as satisfied, leaving the parties to bear their own costs. All pending applications also stand disposed of." 4. The compromise reached by the parties was that the plaintiff