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2000 Supreme(All) 773

IN THE HIGH COURT OF ALLAHABAD
P. K. Jain, J.
DURGA PRASAD TANDON - Appellant
Versus
GAUR BRAHMAN SABHA, NAINITAL - Respondents
Second Appeal 658 Of 2000
Decided On : 05/20/2000

Advocates Appeared:
Murli Dhar, R.K.Khanna

A compromise obtained by playing fraud or exercise of coercion is not a lawful compromise, and a suit for setting aside the decree on such grounds is barred by the provisions of Rule 3a of Order XXIII of the Civil Procedure Code.

Headnote:

Fraud and Coercion - Civil Procedure - Order XXIII Rule 3a, Indian Contract Act, 1872 - Rule 3a, Explanation to Rule 3 - The court held that a compromise obtained by playing fraud or exercise of coercion is not a lawful compromise and, therefore, suit for setting aside the decree on such a ground is barred by the provisions of Rule 3a of Order XXIII. The judgment also discussed the applicability of Rule 1a of Order XLIII in challenging a decree passed under Order XXIII Rule 3. The court referred to the decision of the Hon'ble Supreme Court in Banwari Lal v. Smt. Chando Devi, AIR 1993 SC 1139, to support its interpretation of the legal provisions.

Fact of the Case:

The plaintiffs filed a suit for cancellation of a compromise decree, alleging that it was obtained by coercion and fraud. The trial court dismissed the suit, and the lower appellate court affirmed the decision. The plaintiffs appealed, arguing conflicting decisions on the applicability of Order XXIII Rule 3a of the Civil Procedure Code (CPC) in such cases.

Finding of the Court:

The court found that the lower appellate court did not err in appraising the evidence and recording findings of fact. It held that the suit for setting aside the decree on the ground of an unlawful compromise obtained by fraud or coercion is barred by the provisions of Rule 3a of Order XXIII.

Issues: The main issue was whether the suit for cancellation of the compromise decree was maintainable under the provisions of Order XXIII Rule 3a of the CPC.

Ratio Decidendi: The court's decision was based on the interpretation of Rule 3a of Order XXIII and the Explanation to Rule 3, as well as the applicability of Rule 1a of Order XLIII in challenging a decree passed under Order XXIII Rule 3. The court also referred to the decision of the Hon'ble Supreme Court in Banwari Lal v. Smt. Chando Devi, AIR 1993 SC 1139, to support its interpretation of the legal provisions.

Final Decision: The appeal was dismissed at the admission stage, and the court found no error of law in the judgment and decree passed by the lower appellate court. It held that no substantial question of law was involved in the appeal, and it merited dismissal.

P. K. JAIN, J.

( 1 ) THIS is plaintiffs second appeal against the judgment and decree passed by the trial court dismissing the Original Suit No. 155 of 1989 and the decree of the lower appellate court affirming the judgment and decree of the trial court.

( 2 ) IN short, the facts are that the Small Cause Suit No. 18 of 1987 which was filed against the present appellants by the Gaur Brahman Sabha, Kashipur-respondent No. 1 was decreed in terms of compromise dated 24. 7. 1987. The present plaintiffs/appellants filed Suit No. 155 of 1989 for cancellation of the decree dated 24. 7. 1987 in the said suit on the ground that the compromise was obtained by coercion, fraud, etc. The trial court dismissed the suit mainly on the ground that the suit was not maintainable in view of the provisions of Order XXIII, Rule 3a of the Code of. Civil Procedure. The plaintiffs appellants preferred an appeal. The lower appellate court re-appraised the evidence and recorded a finding of fact that the compromise decree was not obtained by playing fraud or by exercise of undue coercion upon the plaintiffs. The lower appellate court also held that the suit was not maintainable. The lower appellate court consequently dismissed the appeal.

( 3 ) SRI Murli Dhar, learned senior counsel appearing for the appellants has been heard at length at the admission stage. He has submitted that there are conflicting decisions whether in such cases the provisions of Rule 3a of Order XXIII. C. P. C, were attracted or not. He has also submitted that the trial court had not recorded the finding on the question whether the compromise was obtained by playing fraud and exercising coercion. The lower appellate court should have, therefore, remanded this matter to the trial court,

( 4 ) HAVING heard learned counsel for the appellants and having gone through the two judgments of the Courts below. I find that there is no merit in this appeal. It is true that the trial court framed issue No. 1 to the effect that whether compromise dated 24. 7. 1987 was not legal. The trial court, however, did not record any finding on this issue even though evidence of the parties was there. The trial court relying upon a decision of the Honble Supreme Court in Banwari Lal v. Smt. Chando Devi, AIR 1993 SC 1139, held that the suit was not maintainable. The lower appellate court, however, recorded finding on issue No. 1 after examining the evidence adduced by the parties. In arriving its finding, the lower appellate court, besides considering other evidence, had placed reliance upon two material facts, viz. , a term of the compromise decree was that a defendant shall vacate the suit property on expiry of two years from the date of the compromise and in that event the plaintiff in Suit No. 18 of 1987 will not claim any arrears of rent damages from the defendants in that suit. The lower appellate court had observed in its judgment that a sum of Rs. 1,000 was deposited by the defendants as arrears of rent and mesne profits in the trial court to escape consequences of decree of the ejectment. After the said compromise was entered into between the parties, the present plaintiffs/appellants moved an application 37c for refund of the said amount on the ground that with the intervention of certain persons, a compromise has been arrived at and that the defendants applicants have been granted time till 1. 8. 1989 to vacate the suit property and further that the plaintiffs have exonerated the defendants from the liability of arrears of rent, expenses of litigation, etc. Another circumstance or material evidence relied upon by the lower appellate court was that even though there were allegations of coercion and it was alleged that the police had forced the defendants to enter into compromise on threat of being implicated in certain cases, yet the plaintiffs allowed the two years period to lapse and it was only after lapse of the said period that they filed the present suit. The evidence of the parties was alrea










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