REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 776 OF 2012
(Arising out of S.L.P(Civil )No.6632 of 2006)
HORIL ... APPELLANT
VERSUS
KESHAV & ANR. ... RESPONDENTS
J U D G M E N T
Aftab Alam, J.
1. Leave granted.
2. This appeal is directed against the judgment
and order dated November 11, 2003 passed by the
Allahabad High Court by which it allowed the writ
petition filed by respondent nos. 1 and 2, set
aside the order passed by the District Judge,
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affirming the order of the Munsif, and held that
the suit filed by the appellant was not
maintainable being barred in terms of Order XXIII
Rule 3-A of the Code of Civil Procedure.
3. The appellant filed a suit (No. 43 of 1980) in
the court of Munsif, Karwi (Banda) seeking a
declaration that the decree passed by the Assistant
Collector, Class-I, in a suit under sections 176,
178 and 182 of the U.P. Zamindari Abolition & Land
Reforms Act was fraudulent, inoperative and not
binding upon him.
According to the appellant, the
defendants had instituted the suit before the
Assistant Collector in which his father namely
Chunkai was made as one of the opposite party.
In
that suit, a compromise petition was filed on
October 7, 1971 with the fake signature of Chunkai
and on that basis a compromise decree finally came
to be passed on April 25, 1979.
It is the case of
the appellant that no notice of the suit was ever
served upon his father Chunkai.
He never appeared
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in the proceeding and was not even aware of it.
He
did not sign any compromise petition and his
alleged signature on the compromise petition dated
October 7, 1971 was faked.
He had died much earlier
and was not even alive in 1979 when the decree was
passed.
The appellant, accordingly,
sought a
declaration that the decree dated April 25, 1979
passed by the Assistant Collector, Class-I, Karwi,
may be cancelled or it may be declared as void ab
initio, inoperative and not binding upon him.
4. The defendants (respondents 1 and 2 before this
Court) filed a written statement in which
they
questioned the maintainability of the suit as well.
It was contended on their behalf that
as the suit
related to agricultural lands
it was beyond the
jurisdiction and competence of the civil court
and
it could only be tried by the revenue authorities.
The Munsif by his order dated October 1, 1985
upheld the defendants' objection and
held that the
suit was not maintainable before a civil court.
4
Against the order passed by the Munsif,
the
appellant preferred an appeal (M.C.A.No.21 of 1985)
which was allowed by the judgment and order dated
April 14, 1987 passed by the Additional District
Judge, Karwi, (Banda).
The Additional District
Judge rightly pointed out that
the suit filed by
the appellant was based on the allegation that the
decree passed by the Assistant Collector was based
on a fraudulent compromise petition and it did not
involve any adjudication of rights or interests in
the agricultural lands.
Hence, the suit was
maintainable before a civil court.
It, accordingly,
set aside the order passed by the Munsif and
directed him to proceed with the suit in accordance
with law.
5. When the matter came before the Munsif on
remand,
the defendants once again objected to the
maintainability of the suit,
this time raising the
contention that it was barred under the provisions
of Order XXIII Rule 3-A of the Code of Civil
5
Procedure.
The Munsif by his order dated January 7,
1988 dismissed the objection and found and held
that the suit was maintainable.
The defendants-
respondents took the matter in
revision (Civil
Revision No. Nil of 1988) which was dismissed by
the District Judge, Banda, by his order dated
February 17, 1988.
Against the orders passed by
the Munsif and the District Judge,
the defendants
preferred a writ petition before the High Court and
the High Court, as noted above, allowed the writ
petition holding that the suit was not
maintainable.
It is a brief order in which the
High Court referred to the provisions of Order
XXIII Rule 3-A, and relying upon a decision of the
Allahabad High Court allowed the writ petition.
6. It is true that a compromise forming the basis
of the decree can only be questioned before the
same court that recorded the comprise and a fresh
suit for setting aside a compromise decree is
expressly barred under Order XXIII Rule 3-A.
It is
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equally true the expression "not lawful" used in
Rule 3-A of Order XXIII also covers a decree based
on a fraudulent compromise
hence, a challenge to a
compromise decree on the ground that it was
obtained by fraudulent means would also fall under
the provisions of Rule 3-A of Order XXIII.
7. In Banwari Lal Vs. Chando Devi (1993) 1 SCC
581,
this Court examined the provisions of Order
XXIII Rule 3-A in some detail and in light of the
amendments introduced in the Code and in paragraph
7 of the judgment came to hold as follows:
"7. By adding the proviso along with an
explanation the purpose and the object of
the amending Act appears to be to compel
the party challenging the compromise to
question the same before the court which
had recorded the compromise in question.
That court was enjoined to decide the
controversy whether the parties have
arrived at an adjustment in a lawful
manner. The explanation made it clear that
an agreement or a 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. Having
introduced the proviso along with the
explanation in Rule 3 in order to avoid
multiplicity of suit and prolonged
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litigation, a specific bar was prescribed
by Rule 3-A in respect of institution of a
separate suit for setting aside a decree
on basis of a compromise saying:
"3-A. Bar to suit.- No suit shall lie
to set aside a decree on the ground that
the compromise on which the decree is
based was not lawful."
It further held in paragraphs 13 and 14 as
follows:-
"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 the
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 make 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
the proviso read with the explanation, a
Court which had entertained the petition
of compromise has to examine whether the
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compromise was void or voidable under the
Indian Contract Act. Even Rule 1(m) of
Order 43 has been deleted under which an
appeal was maintainable against an order
recording a compromise. As such a party
challenging a compromise can file a
petition under proviso to Rule 3 of Order
23, or an appeal under Section 96(1) of
the Code, in which he can now question the
validity of the compromise in view of Rule
1-A of Order 43 of the Code."
14. .................The court before which it is
alleged by one of the parties to the
alleged compromise that no such compromise
had been entered between the parties that
court has to decide whether the agreement
or compromise in question was lawful and
not void or voidable under the Indian
Contract Act.
If the agreement or the
compromise itself is fraudulent then it
shall be deemed to be void within the
meaning of the explanation to the proviso
to Rule 3 and as such not lawful.
The
learned Subordinate Judge was perfectly
justified in entertaining the application
filed on behalf of the appellant and
considering the question as to
whether
there had been a lawful agreement or
compromise on the basis of which the court
could have recorded such agreement or
compromise on February 27, 1991.
Having
come to the conclusion on the material
produced that the compromise was not
lawful within the meaning of Rule 3, there
was no option left except to recall that
order."
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8. In light of the decision in Banwari Lal it
would prima facie appear that the High Court was
right in holding that the appellant's suit was hit
by the provisions of Order XXIII Rule 3-A and was
not maintainable.
But
the significant
distinguishing feature
in this case is that the
compromise decree
which is alleged to be fraudulent
and which is sought to be declared as nullity was
passed not by a civil court
but by a revenue court
in a suit under section 176 of the U.P. Zamindari
Abolition & Land Reforms Act, 1950 (hereinafter the
Act).
9. Section 331 of the Act bars the
jurisdiction of the civil court and
provides that a
suit under the Act can be entertained by no court
other than that the courts specified in Schedule II
to the Act.
A reference to Schedule II would show
that the court of original jurisdiction for a suit
under section 176 of the Act for division of a
holding of a Bhumidhar is Assistant Collector,
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First Class and the courts of First Appeal and
Second Appeal are Commissioner and the Board of
revenue respectively.
Section 341 of the Act, of
course, provides that unless otherwise expressly
provided by or under the Act,
the provisions of the
Indian Court Fee Act, 1870, the Code Of Civil
Procedure, 1908 and the Limitation Act, 1963,
including section 5 thereof would apply to the
proceedings under the Act.
10. Though the provisions of the Code Of Civil
Procedure have been made applicable to the
proceedings under the Act
but that would not make
the authorities specified under Schedule II to the
Act
as `court' under the Code and those authorities
shall continue to be "courts" of limited and
restricted jurisdiction.
11. We are of the view that
Revenue courts are
neither equipped nor competent to effectively
adjudicate on allegations of fraud that has
overtones of criminality and the courts really
1
skilled and
experienced to try such issues are the
courts constituted under the Code of Civil
Procedure.
12. It is also well settled that under section 9 of
the Civil Procedure Code, the civil court has
inherent jurisdiction to try all types of civil
disputes unless its jurisdiction is barred
expressly or by necessary implication, by any
statutory provision and conferred on any other
tribunal or authority.
We find nothing in Order
XXIII Rule 3-A to bar the institution of a suit
before the civil court even in regard to decrees or
orders passed in suits and/or proceedings under
different statutes before a court, tribunal or
authority of limited and restricted jurisdiction.
13. In our view in the facts of the case
the
provision of Order XXIII shall not act as a bar
against the suit filed by the appellant. We,
accordingly set aside the order of the High Court.
As a consequence, the suit will be restored before
1
the Munsif who is directed to accord it priority
having regard to the fact that for the last 31
years it is stuck up on the issue of
maintainability.
The trial court should try to
dispose of the suit without any delay, and in any
case, not later than one year from the date of
receipt/production of a copy of this order.
14. In the result, the appeal is allowed but with
no order as to costs.
...............................................................J.
(Aftab Alam)
...............................................................J.
(Ranjana Prakash Desai)
New Delhi;
January 20, 2012.
