A consent decree is binding unless set aside, and an uncertified adjustment of a decree cannot be recognized, leading to the rejection of the plaint for lack of cause of action.

Headnote:(A) Code of Civil Procedure, 1908 - Order VII Rule 11 - Civil Revision Applications challenging the rejection of applications under Order VII Rule 11 by the trial court - The court held that the plaint does not disclose a cause of action against the applicants and is barred by limitation. The compromise decree was not challenged, and the MoU was not certified, thus cannot be recognized. (Paras 1, 10, 114)

(B) Limitation - The suit filed by IARCPL and MVEPL was held to be beyond the limitation period as knowledge of the compromise decree was obtained prior to filing the suit. (Paras 56, 114)

(C) Consent Decree - The court emphasized that a consent decree operates as an estoppel and is binding unless set aside by the court that recorded it. (Paras 113, 114)

Facts of the case:
The applicants, Praharsh Corporation Private Limited and Sawan Nandkumar Bhatewara, challenged the rejection of their applications to dismiss the plaint filed by IARCPL and MVEPL, which claimed rights over a property based on an uncertified MoU. The trial court found that the MoU was not recognized as it was not certified, and the compromise decree was not challenged. (Paras 1, 10)

Findings of Court:
The court found that the plaint did not disclose a cause of action against the applicants and was barred by limitation. The compromise decree was valid and binding, and the MoU could not be recognized as it was not certified. (Paras 114, 115)

Issues: The main issues were whether the plaint disclosed a cause of action against the applicants and whether the suit was barred by limitation. (Paras 31, 114)

Ratio Decidendi: The court ruled that an uncertified adjustment of a decree cannot be recognized, and the compromise decree must be challenged to seek relief. The suit was dismissed as it did not disclose a cause of action against the applicants. (Paras 113, 114)

Result: Civil Revision Applications allowed; plaint rejected against the applicants. (Paras 116, 117)

JUDGEMENT

Heard learned Senior Counsel Shri M.G.Bhangde for Praharsh Corporation Private Limited (applicant in Civil Revision Application No./0 and non-applicant No. in Civil Revision Application No./0); learned counsel Dr.

(Shri) Anjan De for International Asset Reconstruction .....5/- Company Private Limited and Madhav Vidarbha Estate Pvt.

Limited (non-applicant Nos. and in both Civil Revision Applications), and learned counsel Shri S.V.Purohit for Mr.

Sawan Nandkumar Bhatewara (applicant No. in Civil Revision Application No./0 and applicant in Civil Revision Application No./0).

. Rule.

By these Civil Revision Applications, applicants have challenged order dated ..0 passed below Exhibits-0 and by learned th Joint Civil Judge Senior Division, Nagpur in Special Civil Suit No.0/0 whereby the said applications under Order VII Rule of the Code of Civil Procedure have been rejected.

Relevant facts necessary for disposal of civil revision applications are as under:Non-applicant No.1 – International Asset Reconstruction Company Private Limited (hereinafter .....6/- referred to as “IARCPL”) and non-applicant No. - Madhav Vidarbha Estate Private Limited (hereinafter referred to as “MVEPL”), original plaintiffs, have preferred a civil suit bearing Special Civil Suit No.0/0. IARCPL is a company registered under the Companies Act, 0. City Survey No., Sheet No.0 of Mouza Sitabuldi together with single storied house bearing No. having built up area . square meters, situated at Ravindranath Tagore Marg, Civil Lines, Ward No., Nagpur, is the subject matter of the dispute. The above said suit property was originally owned by Shri Manohar Puranik and other Puranik family members. Puranik family vide sale deeds dated ..0 and..0 sold the suit property along with its structure to Smt.Punam Anand Agarwal and Smt.Savita Chandra Agarwal. Smt.Punam Anand Agarwal and Smt.Savita Chandra Agarwal executed sale deed on .. in favour of Jyoti and Surendra Developers Private Limited, Nagpur.

As per the said sale deed dated .., the parties had filed statement in Form No.–I under Section UC of the .....7/- Income Tax Act, with the Income Tax Authorities. The Income Tax Authorities at Ahmedabad vide its order dated .. held that it was a fit case for pre-emptive purchase order under Section UD() of the Income Tax Act and obtained possession of the suit property. The said order of the Income Tax Authorities was challenged by Jyoti and Surendra Developers Private Limited before this court by filing Writ Petition No./. During the pendency of the said writ petition, the Income Tax Department held an auction of the suit property on ... In the said auction, non-applicant No.- Riddhi Investment and Properties Private Limited was the highest bidder and, therefore, the bid was accepted and sale was confirmed in favour of Riddhi Investment and Properties Private Limited on .. subject to the decision of Writ Petition No./. The Income Tax Department, after having accepted the bid of Riddhi Investment and Properties Private Limited, granted possession of the suit property vide letter of possession dated ... As per IARCPL, no sale deed .....8/- was executed by the Income Tax Department in respect of the suit property in favour of Riddhi Investment and Properties Private Limited. Writ Petition No./ was dismissed on 0..0 by observing that the writ petition filed is misconceived.

On .., Riddhi Investment and Properties Private Limited entered into an agreement of sale with Praharsh Corporation Private Limited (applicant in Civil Revision Application No./0 and non-applicant No. in Civil Revision Application No./0) for total consideration of Rs.0.00 lacs and received sum of Rs..00 lacs on that day itself. Riddhi Investment and Properties Private Limited again on ..entered into an agreement of sale with Nimish Investment Private Limited (subsequently known as “M/s.Madhyadesh Construction and Finance Private Limited”) for total consideration of Rs.,,00,000/- and received amount as advanc

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2024 Supreme(Online)(Bom) 364

HIGH COURT OF BOMBAYHON'BLE SMT. JUSTICE URMILA SACHIN JOSHI- PHALKEPRAHARSH CORPORATION PVT. LTD. FORMERLY KNOWN AS PRAHARSH INVESTMENTS PVT. LTD. MUMBAI – AppellantVersusINTERNATIONAL ASSET RECONSTRUCTION CO. PVT. LTD. NEW DELHI AND CORPORATE OFFICE AT MUMBAI AND ORS – RespondentCRA/92/2019

A consent decree is binding unless set aside, and an uncertified adjustment of a decree cannot be recognized, leading to the rejection of the plaint for lack of cause of action.