A compromise decree's validity is subject to registration; bona fide purchasers are protected even in fraud cases.

COMMON ORDER

The decree holder is the revision petitioner in both the Civil Revision Petitions.

2.I have heard Mr.V.Haribabu, learned counsel for the revision petitioner in both the revision petitions and Mr.Ravi Kumar Paul, learned Senior Counsel for Mr.B.Murugavel, learned counsel for the 3^rd respondent in CRP.No.4900 of 2023.

3.The respondents 1 and 2, despite multiple attempts to serve them, have remained elusive and evasive and hence, this Court has directed the revision petitioner to effect paper publication. In compliance with the same, the learned counsel for the petitioner has also effected paper publication in DT Next, Chennai Edition, English Daily and Malai Malar, Chennai Edition, Tamil newspaper dated 04.02.2026 and 05.02.2026. The respondents 1 and 2 are called and set ex-parte.

4.The facts, that are necessary for disposal of these revision petitions are as follows:

The Managing Director of the first respondent had approached the petitioner and purchased cotton bales from the petitioner on credit basis. A promissory note was executed by the Managing Director of the first respondent for Rs.30,76,125/- on behalf of the first respondent Company. In view of default committed by the first respondent Company, the petitioner filed a suit in O.S.No.429 of 1996. In the suit, the respondents 1 and 2 offered to settle the matter and after negotiations, a compromise decree was passed on 24.12.1996. The petitioner filed E.P.No.81 of 2006 for recovery of Rs.71,17,907.75/- by way of attachment and sale of the properties belonging to the respondents 1 and 2. In the said execution petition, the respondents 3 and 4 invoked provisions available under Order XXI Rule 58 of CPC, stating that even prior to the execution petition filed by the petitioner in C.S.No.687 of 1995, the suit property was already attached in their favour. The said application was opposed by the revision petitioner, contending that a decree in C.S.No.687 of 1995 was collusive and only in order to defeat the compromise decree in O.S.No.429 of 1996. After enquiry, by order dated 181.11.2021, the said application Order XXI Rule 58 of CPC was allowed and the EP was dismissed. Challenging the dismissal of the said EP, CRP.No.4898 of 2023 has been filed and as against the order allowing the application under Order XXI Rule 58 of CPC in E.A.79 of 2008, CRP.No.4900 of 2023 has been filed.

5.Mr.V.Haribabu, learned counsel appearing for the revision petitioner in both the revision petitions would submit that the respondents 1 and 2 have played fraud upon the Court and also the petitioner/decree holder. According to learned counsel for the petitioner, respondents 3 and 4 are also party to fraud, as they have colluded with the respondents 1 and 2 to defeat the legitimate claims of the petitioner. He would state that fraud being an act of deliberate deception, with the design of securing something by taking unfair advantage of another, then such an act of cheating vitiates every solemn act.

6.Relying on the decision of the Hon’ble Supreme Court in S.P.Chengalvaraya Naidu (Dead) by LR's Vs. Jagannath (Dead) by LR's and Others reported in (1994) 1 SCC 1 and Indian Bank Vs. Sathyam Fibres (India) Private Limited, reported in 1996 (5) SCC 550, Mr.V.Haribabu, learned counsel would state that the respondents 1 and 2 have hoodwinked the petitioner, offering their property, suppressing the fact that they have already offered the very same property to various creditors and therefore, it is a clear case of fraud and in such event, the petitioner cannot be made to suffer by allowing the fraudsters to take undue advantage. He would also take me through the relevant encumbrance certificates and contend that even prior to the attachment, in r