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2025 Supreme(Bom) 1297

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
N.J. JAMADAR, J.
Anwar Liyakat Khan - Appellant
Versus
Ramesh Dattatraya Dhone - Respondent 
Writ Petition No. 9309 of 2024
Decided On : 09-06-2025

Advocates:
Advocate Appeared:
For the Appellants : V.A. Thorat, Arkesh Ayyagari
For the Respondent: Vijay Upadhyay

A consent decree obtained through fraud is challengeable by a third party, and such a challenge does not require an independent suit.

Headnote:The judgment analyzes the legality of a consent decree under the provisions of Order XXIII of the Code of Civil Procedure. The court finds that the petitioners unlawfully obtained the decree by misrepresentation about the properties. The court concludes that the application for recall of the decree by third parties is maintainable, reaffirming that fraud vitiates all acts. The court rules the impugned order as interim and clarifies the procedure for hearing the application.

Table of Content
1. consent decrees must be legally sound and free from fraud if upheld. (Para 1 , 2)
2. fraud undermines the integrity of consent decrees, allowing for recall even by third parties. (Para 10 , 12 , 18)
3. legal procedures allow challenges to consent decrees when fraud is alleged, focusing on proper court jurisdiction. (Para 22 , 26 , 30)

JUDGMENT :

N.J. JAMADAR, J.

1. Rule. Rule made returnable forthwith and, with the consent of the learned Counsel for the parties, heard finally.

2. The petitioners, who were the parties to RCS/2546/2022, which came to be decreed in accordance with the Consent Terms dated 15th December, 2022, by an order dated 23rd December, 2022, and the supplementary Consent Terms, which were accepted, by an order dated 4th May, 2023, assail the legality, propriety and correctness of an order dated 6th November, 2023 passed by the learned Civil Judge in an application, being Civil Misc. Application No.1680 of 2023, preferred by the respondents – third parties, whereby the learned Civil Judge, by way of interim relief, stayed the effect and operation of the decree dated 23rd December, 2022 as modified by the order dated 4th May, 2023 and restored the said RCS/2546/2022 to the file of the Court granting liberty to the respondents to take steps for their impleadment under the provisions of Order I Rule 10 of the Code of Civil Procedure Code, 1908 (“the Code”).

3. The background facts necessary for the determination of this petition can be stated in brief as under:

3.1 Dara K. Irani was the holder of several properties described in Exhibit-A appended to RCS/2546/2022. Dara Irani passed away on 21st October, 2004. During his lifetime, in the year 2004, Dara Irani had executed a Deed of Assignment in favour of Anwar Khan, the defendant in RCS/2546/2022 (petitioner No.1 herein) and thereby agreed to sale, convey and alienate all his properties. Dara Iranai had allegedly received an amount of Rs.51,00,000/- from the defendant towards the part consideration. Dara Irani had executed a Power of Attorney in favour of Mr. Arvindkumar C. Rao, the plaintiff in RCS/2546/2022 (petitioner No.2 herein). It was inter alia agreed that the plaintiff would recover the balance consideration from the defendant and apply the same for charitable purposes.

3.2 After the demise of Dara Irani, disputes arose between the plaintiff and defendant. Alleging that the defendant was dealing with some of the properties, left behind by the deceased Dara Irani, falsely representing that he was absolutely entitled to the said properties, without fulfilling his obligation to pay the balance consideration, the plaintiff instituted a suit to restrain the defendant from transferring, encumbering, alienating or creating any third party rights in respect of the suit properties without the consent of the plaintiff.

3.3 In the said suit, it appears, the plaintiff and defendant arrived at a settlement and the Consent Terms were executed on 15th December, 2022. Based on the said Consent Terms, by an order dated 23rd December, 2022, the learned Civil Judge passed a decree in accordance with the Consent Terms (Exhibit-12).

3.4 Subsequently, the plaintiff preferred an application being Civil Application No.23/2023 asserting, inter alia, that inadvertently certain properties were not mentioned in the Consent Terms. By an order dated 4th May, 2023, the learned Civil Judge accepted the supplementary Consent Terms so as to include the properties bearing Survey Nos.74 A/1, 74 A/2, 74/B, 74/C, 82/1 and 82/2 situated at village Manjari, Taluka Haveli, District Pune, in the said consent decree.

3.5 The respondents herein preferred an application being MCA/1680/2023 in the said RCS/2546/2022 purportedly under Section 151 read with Order I Rule 10 of the Code seeking recall of the consent decree, restoration of RCS/2546/2022 to file and impleadment of the applicants as party defendants to the said suit, asserting, inter alia, that the applicants were the holders of th

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