2005 Supreme(SC) 991

2005(5) Supreme 388
Supreme Court of India
(From Allahabad High Court)
R.C. Lahoti, CJI, C.K. Thakker & P.K. Balasubramanyan, JJ.
Kishun @ Ram Kishun (Dead) through Lrs. —Appellant
versus
Bihari (D) by Lrs. —Respondent
Civil Appeal Nos. 4802-4803 of 2005
(Arising out SLP (C) Nos. 3588-3589 of 2004)
Decided on 5-8-2005
Counsel for the Parties :
For the Appellant : Anurag Kishore, Ashwani Garg and Rajesh Kumar, Advocates.
For the Respondent : T.M. Mohd. Yousuf, Sr. Advocate, Shakil Ahmed Syed and Mohd. Taiyab Khan, Advocates.

Important point
When there is a contest on the question whether there was a com­promise or not, a decree accepting the compromise on resolution of that controversy, cannot be said to be a decree passed with the consent of the parties, therefore, the bar under Section 96(3) of the Code of Civil Procedure could not apply.

Headnote:(i) Civil Procedure Code, 1908—Section 100—Second Appeal—Abatement—Death of appellant as well as respondent during pendency of appeal—No steps were taken to bring on record legal representatives of either the deceased appellant or the deceased respondent—Second appeal abated—Decree passed by the High Court in favour of a party who was dead and against a party who was dead, is a nullity—Decision of High Court held liable to be set aside.

       Held : While the second appeal was pend­ing, Kishun, the first defendant in the suit and the respondent in the second appeal, died in the year 1990. Behari, the appel­lant, died in the year 1993. No steps were taken to bring on record the legal representatives of either the deceased appellant or the deceased respondent. The second appeal in fact abated. But it is seen that on 24.11.1999, the High Court of Allahabad after hearing counsel for the appellant (appellant Behari had died six years before), proceeded to allow the second appeal on the ground that the appeal against the compromise decree filed by Kishun before the Additional District Judge, was not main­tainable in view of Section 96(3) of the Code which provides that no appeal shall lie from a decree passed by the court with the consent of parties. The High Court, therefore, held that the First Appellate Court had no jurisdiction to entertain the appeal and to allow the same. There was no consideration of the merits. This decision rendered in second appeal by the High Court of Allahabad is challenged in this appeal, by the legal representatives of Kis­hun. The son of Behari is impleaded as the respondent. As rightly pointed out by learned counsel for the appellants and fairly agreed to by learned senior counsel for the respon­dent, the decree passed by the High Court in favour of a party who was dead and against a party who was dead, is obviously a nullity. It is conceded that the legal representatives of neither of the parties were brought on record in the second appeal and the second appeal stood abated. On this short ground this appeal is liable to be allowed and the decision of the High Court set aside. (Paras 4 and 5)

       (ii) Civil Procedure Code, 1908—Sections 96(3) and 100; Order XXIII Rule 3; Order XLIII Rule 1(m) as it stood before the amendment, by Act 104 of 1976—Non appellability of a decree passed by the Court with consent of parties—When one of the parties sets up a compromise and the disputes it—No appeal is provided against an order rejecting or accepting a compromise after an enquiry—Respondent plaintiff filed a suit for cancellation of gift made in favour of his brother, ­appellant by his father—Plaintiff filed an application stating that there was a compromise of dispute between the two brothers—However, defen­dant denying the fact of compromise, an enquiry was made by the Court on the existence and acceptability of the adjustment of dispute pleaded—Trial Court held that there was no valid compro­mise or adjustment of dispute—Appellate Court set aside order of trial Court directing trial Court to proceed with the matter in terms of compromise petition—Appeal against decree passed by trial Court—Whether maintainable—(Yes)—It could not be held to be a decree passed by Court with consent of parties.

       Held : The High Court was in error in holding that the appeal filed by Kishun against the decree of the trial court accepting a compromise which was dis­puted by him, was not maintainable. When on a dispute in that behalf being raised, an enquiry is made (now it has to be done in view of the proviso to Order XXIII Rule 3 of the Code added by Act 104 of 1976) and the suit is decreed on the basis of a com­promise based on that enquiry, it could not be held to be a decree passed on consent within the meaning of Section 96(3) of the Code. Section 96(3) contemplates non-appellability of a decree passed by the court with the consent of parties. Obviously, when one of the parties sets up a compromise and the other disputes it and the court is forced to adjudicate on whether there was a compromise or not and to pass a decree, it could not be understood as a decree passed by the court with the consent of parties. As we have noticed earlier, no appeal is provided after 1.2.1977, against an order rejecting or accepting a compromise after an enquiry under the proviso to Order XXIII Rule 3, either by Section 104 or by Order XLIII Rule 1 of the Code. Only when the acceptance of the compromise receives the imprimatur of the court and it becomes a decree, or the court proceeds to pass a decree on merits rejecting the compromise set up, it becomes appealable, unless of course, the appeal is barred by Section 96(3) of the Code. We have already indicated that when there is a contest on the question whether there was a compromise or not, a decree accepting the compromise on resolution of that controver­sy, cannot be said to be a decree passed with the consent of the parties. Therefore, the bar under Section 96(3) of the Code could not have application. An appeal and a second appeal with its limita­tions would be available to the party feeling aggrieved by the decree based on such a disputed compromise or on a rejection of the compromise set up. We think that in this case, a proper enquiry as to whether there was a compromise or an adjustment of the dispute, in terms of the proviso to Order XXIII Rule 3 of the Code is warranted. The decision in the Second Appeal is also a nullity since it was passed in favour of a deceased appellant against a deceased respondent. (Paras 6 and 7)