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IN THE HIGH COURT OF KARNATAKA
M.I. Arun, J.
Krishnamma & Ors. - Appellants
Versus
Kalappa & Ors. - Respondents
Review Petition No. 418 of 2022 in Regular First Appeal No. 956 of 2018 (PAR)
Decided On : 19-07-2022
APPEAL - COMPROMISE DECREE - SECTION 96(3) OF CPC, ORDER 43 RULE 1A(2) OF CPC - The court discussed the maintainability of an appeal against a compromise decree and the applicability of Section 96(3) of CPC and Order 43 Rule 1A(2) of CPC. The court considered various judgments including Banwari Lal v. Chando Devi, Vipan Aggarwal & Anr. v. Raman Gandotra & Ors., M/s. Thungabhadra Industries Ltd. v. The Government of Andhra Pradesh, Parsion Devi v. Sumitri Devi, Triloki Nath Singh v. Anirudh Singh, and Ravindra v. Vimal and Ors. to determine the maintainability of the appeal against the compromise decree. The court held that an appeal is not maintainable from a compromise decree under Section 96(3) of CPC and that the compromise decree confers only a right in personam and is not binding on parties who are not part of the compromise. The review petition was dismissed.
Fact of the Case:
The petitioners were originally defendants in a suit and were deleted from the original suit after a compromise was arrived at between the plaintiffs and some of the defendants. The petitioners preferred an appeal against the compromise decree, which was disposed of as not maintainable. The review petition was filed on the ground that the impugned judgment suffers from an error apparent on the face of the record.
Finding of the Court:
The court held that an appeal is not maintainable from a compromise decree under Section 96(3) of CPC and that the compromise decree confers only a right in personam and is not binding on parties who are not part of the compromise. The review petition was dismissed.
Issues: The main issue was the maintainability of an appeal against a compromise decree and the applicability of Section 96(3) of CPC and Order 43 Rule 1A(2) of CPC.
Ratio Decidendi: The court's decision was based on the interpretation of Section 96(3) of CPC, Order 43 Rule 1A(2) of CPC, and various judgments to determine the maintainability of the appeal against the compromise decree.
Final Decision: The review petition was dismissed.
JUDGMENT
1. Aggrieved by the judgment dated 07.02.2022 rendered by this Court in RFA No. 956/2018, the instant review petition is filed on the ground that the impugned judgment suffers from an error apparent on the face of the record.
2. The petitioners herein were the appellants in RFA No. 956/2018. The petitioners were originally defendants in the suit in O.S.No. 450/2008 along with several other defendants. The petitioners were deleted from the original suit and a compromise was arrived at between the plaintiffs and some of the defendants and a compromise decree was passed. Aggrieved by the said compromise decree, the petitioners herein preferred RFA No. 956/2018. The said appeal was disposed of as not maintainable for the following reasons:
"6. It is needless to state that the rights determined by way of a compromise petition in the impugned judgment and decree are rights in personam and not right in rem and are normally binding only between the parties to the compromise petition.
7. In the instant case, admittedly, the appellants are not parties to the compromise petition. If they are aggrieved by the compromise, they can always move the Court which recorded the compromise and in such an event, the Court shall examine the same in accordance with law. An appeal from a compromise decree is barred under Section 96(3) of CPC and the instant appeal for that reason is not maintainable."
Aggrieved by the same, the instant review petition is filed.
3. The case of the petitioners is that an appeal against a compromise decree is maintainable under the provisions of Section 96(1) read with Order 43 Rule 1A(2) of CPC.
4. In this context, the petitioners have relied upon the following judgments:
(1) Banwari Lal v. Chando Devi (SMT) (Through Lrs.) and Another [(1993)1 SCC 581]
(2) Vipan Aggarwal & Anr. v. Raman Gandotra & Ors. (Civil Appeal No. 3492/2022 decided on 29.04.2022) Based on the aforementioned judgments, it is contended that the appeal in RFA No. 956/2018 ought not to have been disposed of holding that an appeal does not lie.
5. The petitioners have further relied upon the following judgments to explain what is error apparent on the face of the record and it is contended that there is an error apparent on the face of the record in the instant case:
1. M/s. Thungabhadra Industries Ltd. v. The Government of Andhra Pradesh represented by the Deputy Commissioner of Commercial Taxes, Anantapur [AIR 1964 SC 1372]
2. Parsion Devi v. Sumitri Devi [(1997)8 SCC 715] Based on the aforementioned provisions of law and the judgments, the petitioners contend that the appeal is maintainable and disposing of the same on the ground that the appeal is not maintainable amounts to an error apparent on the face of the record.
6. Respondent nos.1, 4 and 32 to 38 support the case of the petitioners.
7. Per contra, respondent nos.19, 20 and 31 justify the judgment rendered by this Court in RFA No. 956/2018 and contend that an appeal is not maintainable in the instant case and RFA No. 956/2018 has been rightly disposed of. They further contend that even presuming if the judgment is erroneous but not conceding, there is no error apparent on the face of the record and if the petitioners are aggrieved by the same, they have to prefer an appeal and they cannot file a review petition.
8. It is contended by them that Section 96(3) of CPC bars any appeal from a compromise decree. They have relied upon the following judgments to support their contention that, in the instant case, a review does not lie and if the petitioners are aggrieved, they have to prefer an appeal:
1. Triloki Nath Singh v. Anirudh Singh [(2020)6 SCC 629]
2. M/s. Thungabhadra Industries Ltd. v. The Government of Andhra Pradesh represented by the Deputy Commissioner of Commercial Taxes, Anantapur [AIR 1964 SC 1372]
3. A decision of this Court in Ravindra v. Vimal and Ors. [RSA No. 100888/2014 DD 23.06.2015].
Based on the aforementioned contentions, it is prayed that the review petition be dismissed.
9. Sectio
An appeal is not maintainable from a compromise decree under Section 96(3) of CPC, and the compromise decree confers only a right in personam and is not binding on parties who are not part of the com....
A party aggrieved by a compromise decree has a right to challenge the compromise decree by way of an appeal or to approach the same court which passed such decree by way of an appropriate application....
A party can appeal against a compromise decree to challenge its validity despite Section 96(3) CPC barring appeals against such decrees.
A consent decree obtained through fraud is void, and courts must investigate claims of fraud before accepting the decree as valid.
An appeal against a decree based on disputed consent terms is maintainable under Section 96 of the CPC, bypassing the restrictions applied to true consent decrees.
A suit challenging a compromise decree not challenged, but the compromise itself is called into question, would be barred by the provisions of Order XXIII Rule 3A of CPC. Additionally, a third party,....
(1) Breach of compromise – Only remedy available to aggrieved party is to approach court that recorded compromise under proviso to Order 23, Rule 3 of CPC.(2) When there is a statutory remedy availab....
A suit where a decree based on compromise is not challenged, but compromise itself is called into question, would also be barred by provisions of Order XXIII Rule 3A of CPC.
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