ORDER :

Krushna Ram Mohapatra, J.

1. Heard Miss D. Priyanka learned counsel for the appellant and learned counsel for the respondents.

2. This appeal has been filed assailing the decree and order dated 14.10.1998 passed by the learned Civil Judge (Senior Division) Balasore in T.S. No. 411 of 1998 recording a compromise between the parties to the suit. This appeal is filed mainly on the ground that the compromise recorded was an outcome of fraud. Hence, learned counsel for the appellant prays for setting aside the impugned compromise decree and for issuance of a direction for disposal of the suit on merit.

3. Learned counsel for the respondents raises objection to the above submissions on the ground that the appellant who was defendant No. 2 in the Court below is an signatory to the compromise petition and in view of the provision under Order 23 Rule 3 CPC he could not have filed this appeal against decree of compromise and any grievance with regard to such compromise can only be raised before the Court which recorded such compromise. Learned counsel for the respondents also submits that in view of provision of Section 96(3) CPC an appeal is barred as against the said decree recorded on compromise.

4. Miss Priyanka learned counsel for the appellant on the other hand submits that in view of Order 43 Rule 1-A(2) CPC this appeal is maintainable and the Court can entertain and pass necessary orders thereon. She relies upon a decision of the Hon'ble Supreme Court in the case of Banwarilal Vs. Smt. Chando Devi (through L.R.) and another reported in AIR 1993 SC 1139 wherein the Hon'ble Supreme Court at paragraphs 9 to 13 held as under:

9. Section 96(3) of the Code says that no appeal shall lie from a decree passed by the Court with the consent of the parties. Rule 1A(2) has been introduced saying that against a decree passed in a suit after recording a compromise it shall be open to the appellant to contest the decree on the ground that the compromise should not have been recorded. When Section 96(3) bars an appeal against decree passed with the consent of parties it implies that such decree is valid and binding oh the parties unless set aside by the procedure prescribed or available to the parties. One such remedy available was by filing the appeal under Order 43 Rule 1(m). If the order recording the compromise was set aside there was no necessity or occasion to file an appeal against the decree. Similarly a suit used to be filed for setting aside such decree on the ground that the decree is based on an invalid and illegal compromise not binding on the plaintiff of the second suit. But after the amendments which have been introduced neither an appeal against the order recording the compromise nor remedy by way of filing a suit is available in cases covered by Rule 3A of Order 23. As such a right has been given under Rule 1A(2) of Order 43 to a party who challenges the recording of the compromise to Question the validity thereof while preferring an appeal against the decree. Section 96(3) of the Code shall not be a bar to such an appeal because Section 96(3) is applicable to cases where the factum of compromise or agreement is not in dispute.

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13. When the amending Act introduced a proviso along with an explanation to Rule 3 of Order 23 saying that where it is alleged by one party and denied by other that an adjustment or satisfaction has been arrived at, "the Court shall decide the question", the court before which a petition of compromise is filed and which has recorded such compromise, has to decide the question whether an adjustment or satisfaction had been arrived at on basis of any lawful agreement. To take the enquiry in respect of validity of the agreement or the compromise more comprehensive, the explanation to the proviso says that an agreement or compromise "which is void or voidable under the Indian Contract act..." shall not be deemed to be lawful within the meaning of the said Rule. In view of