Sree Surya Developers and Promoters vs N. Sailesh Prasad

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 439 OF 2022

M/s. Sree Surya Developers and Promoters ...Appellant(s)

Versus

N. Sailesh Prasad and Ors. ...Respondent(s)

WITH

CIVIL APPEAL NOS. 440-441 OF 2022

M/s. Raja Pushpa Properties Pvt. Ltd. ...Appellant(s)

Versus

N. Sailesh Prasad and Ors. ...Respondent(s)

J U D G M E N T

M.R. SHAH, J.

1. Feeling aggrieved and dissatisfied with the impugned judgment

and order dated 01.10.2019 passed by the High Court for the State of

Telangana at Hyderabad in Appeal Suit No.454 of 2019 by which the

High Court has allowed the said appeal preferred by the respondent

No.1 herein – original plaintiff and has quashed and set aside the order

passed by the learned II Additional District Judge, Ranga Reddy District

dated 02.05.2019 in I.A. No.108 of 2019 in O.S. No.537 of 2018 by

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which the learned Trial Court rejected the plaint under Order 7 Rule

11(d) of the Civil Procedure Code (hereinafter referred to as “CPC”), the

original defendants to O.S. No.537 of 2018 have preferred the present

appeals.

2. The facts leading to the present appeals in nutshell are as under:-

2.1 That the suit schedule property was gifted to the respondent No.1

herein – original plaintiff during his minority by his paternal grandmother

(respondent No.2 herein and original defendant in O.S. No.537 of 2018)

vide registered Gift Deed dated 13.02.2003. That the said Gift

Settlement Deed was revoked vide Revocation of Gift Deed dated

10.12.2004 by the grandmother of the respondent No.1 herein – original

plaintiff. That thereafter a registered Development Agreement-cumGeneral Power of Attorney dated 18.01.2008 came to be executed

between the grandmother of the plaintiff and the appellant herein – M/s.

Sree Surya Developers and Promoters – original defendant No.2. It

appears that under the said Development Agreement, the grandmother

was entitled to 35,000 sq. ft. of fixed saleable super built-up area along

with proportionate number of car parking spaces and undivided share in

the land.

2.2 The father of the respondent No.1 – original plaintiff (original

respondent No.3 herein and defendant No.3 in O.S. No.537 of 2018)

filed a suit being O.S. No.1750 of 2015 as the next friend of then minor

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respondent No.1 herein seeking for declaration that revocation of Gift

Deed dated 10.04.2004 as being illegal and not binding on the plaintiff

therein and also for perpetual injunction. Subsequently, a compromise

was arrived at between the parties to O.S. No.1750 of 2015 vide

Compromise Deed Dated 30.12.2015. Under the Compromise, it was

agreed that the respondent No.1 herein – original plaintiff would be

entitled to entire 35,000 sq. ft. of the constructed area, which was

agreed to be allocated to the grandmother under the Development

Agreement. It was further agreed as per the Compromise Decree that

the Developer would be entitled to assign the development rights

accrued to it under the said Development Agreement to the third parties.

In furtherance of the compromise, I.A. No.31 of 2016 under Order XXIII

Rule 3 CPC came to be filed alongwith the Compromise Memo praying

for passing of decree in terms thereof. The father of the respondent

No.1 (respondent No.3 herein – original defendant No.3) filed I.A. in the

said suit under Rule 172 of the Civil Rules of Practice seeking

permission to act on behalf of the respondent No.1 herein and the Trial

Court was pleased to permit him to do so.

2.3 Thereafter, the Compromise Decree came to be passed by the VIII

Additional Senior Civil Judge, RR District dated 13.01.2016 in O.S.

No.1750 of 2015 in terms of the Memorandum of Compromise entered

into by the father on behalf of respondent No.1 herein, the grandmother

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and the appellant herein – Developer. It appears that thereafter the

appellant – Developer assigned its development rights under the abovementioned Development Agreement to respondent No.4 herein under a

Deed of Assignment dated 06.04.2016 and on the basis of the same, the

respondent No.4 has started developing the subject property in O.S.

No.537 of 2018.

2.4 That on attaining the age of majority, the respondent No.1 herein

filed the present suit being O.S. No.537 of 2018 through his General

Power of Attorney praying inter alia declaration of right, title and interest

over the suit schedule property and declaration of Compromise Decree.

He also prayed the revocation of deed as null and void.

2.5 That having been served with a notice of the suit, the appellant

filed written statement denying all the material allegations. The appellant

also filed I.A. No.108 of 2019 under order VII Rule 11 CPC for rejection

of the plaint on various grounds and mainly on the ground that the suit

for setting aside the consent decree/Compromise Decree would be

barred under Order XXIII Rule 3A of CPC. The Trial Court vide order

dated 02.05.2019 allowed the said I.A. and rejected the plaint on the

ground that in view of Order XIII Rule 3A CPC, no independent suit

would be maintainable against the Compromise Decree.

2.6 Feeling aggrieved and dissatisfied with the order passed by the

Trial Court rejecting the plaint in exercise of powers under Order VII Rule

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11(d) CPC on the ground that in view of the provisions of Order XXIII

Rule 3A CPC, no independent suit would be maintainable against the

Compromise Decree, the original plaintiff preferred the present appeal

before the High Court.

2.7 By the impugned judgment and order, the High Court has allowed

the said appeal and has quashed and set aside the order passed by the

Trial Court rejecting the plaint and has remanded the matter to the Trial

Court by observing that the effect of the provisions of Order XXXII Rules

1 to 7 CPC has not been considered by the Trial court, which would have

a direct bearing on the validity of the Compromise Decree dated

13.01.2016 in O.S. No.1750 of 2015.

2.8 Feeling aggrieved and dissatisfied with the impugned judgment

and order passed by the High court, the original defendant Nos. 2 and 4

– Developer and its Assignee have preferred the present appeals.

3. Shri Mukul Rohatgi, learned Senior Advocate appearing on behalf

of the appellant – Developer has vehemently submitted that in the facts

and circumstances of the case, the High Court has committed a grave

error in quashing and setting aside the order passed by the Trial court

rejecting the plaint in exercise of powers under Order VII Rule 11 CPC

holding that in view of Order XXIII Rule 3A CPC, no independent suit

would be maintainable against the Compromise Decree.

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3.1 It is submitted that Order XXIII Rule 3 CPC provides for

compromise of suit. It is submitted that by way of amendment in 1976

made by Act No.104 of 1976, Rule 3A has been inserted, which

specifically provides that 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 is submitted that therefore the present suit filed by the

respondent No.1 herein – original plaintiff challenging the Compromise

Decree would be barred under Order XXIII Rule 3A CPC and therefore

the Trial Court rightly rejected the plaint.

3.2 It is further submitted by Shri Rohatgi, learned Senior Advocate

appearing on behalf of the appellant – Developer and the learned

counsel for the Assignee that as held by this Court in a catena of

decisions, the only remedy available to the aggrieved party would be to

submit an appropriate application before the same Court which recorded

the compromise. Reliance is placed on decisions of this Court in the

case of Banwari Lal Vs. Chando Devi, (1993) 1 SCC 581; Pushpa

Devi Bhagat Vs. Rajinder Singh & Ors., (2006) 5 SCC 566; Horil Vs.

Keshav, (2012) 5 SCC 525; R. Rajanna Vs. S.R. Venkataswamy &

Ors., (2014) 15 SCC 471 and recently in R. Janakiammal Vs. S.K.

Kumarasamy, (2021) 9 SCC 114.

3.3 It is submitted that in the present case as such the original plaintiff

had already filed an application under Order XXIII Rule 3A before the

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same court which passed the consent Compromise Decree. It is

submitted that in the present case even the original plaintiff has filed a

first appeal under Order XLIII before the first Appellate court challenging

the Compromise Decree. It is submitted that therefore as such the

plaintiff has already availed the other remedies available to him. It is

submitted that therefore the present suit is nothing but an abuse of

process of law. It is submitted that in any case, the substantive

independent suit questioning the Compromise Decree shall not be

maintainable in view of Order XXIII Rule 3A CPC.

3.4 It is further submitted by Shri Rohatgi, learned Senior Advocate

appearing on behalf of the appellant that in the present case the

respondent No.1 herein – original plaintiff has indulged in clever drafting

seeking one relief by way of drafting multiple prayers. It is submitted that

the only relief that the plaintiff seeks is setting aside the Compromise

Decree dated 13.01.2016 which he has sought by drafting multiple

prayers in order to avoid the bar to suit envisaged under Order XXIII

Rule 3A of CPC, which in other words is mere clever drafting. It is

submitted that as held by this Court in a catena of decisions by mere

clever drafting of the plaint, the plaintiff cannot be permitted to maintain

the suit, which otherwise would not be maintainable and/or barred by

any law. It is further observed and held by this Court that if clever

drafting of the plaint has created the illusion of a cause of action, the

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court will nip it in the bud at the earliest so that bogus litigation will end at

the earlier stage. Reliance is placed on the decisions of this Court in the

case of T. Arivandandam Vs. T.V. Satyapal and Anr., (1977) 4 SCC

467; Madanuri Sri Rama Chandra Murthy Vs. Syed Jalal, (2017) 13

SCC 174; Canara Bank Vs. P. Selathal and Ors., (2020) 13 SCC 143;

and Raghwendra Sharan Singh Vs. Ram Prasanna Singh, (2020) 16

SCC 601.

3.5 Shri Rohatgi, learned Senior Advocate has further submitted that

even otherwise the impugned judgment and order passed by the High

Court is unsustainable. It is submitted that in the entire judgment, there

is no discussion by the High Court on the maintainability of the suit

and/or any discussion on Order XXIII Rule 3A CPC on the basis of which

the Trial Court rejected the plaint.

3.6 It is submitted that on the contrary, the High Court has gone into

the validity of the Compromise Decree considering Order XXXII Rules 1

to 7 CPC and the High Court has virtually given the findings relying upon

Order XXXII Rule 7 CPC that the Compromise Decree was not binding

to the plaintiff. It is submitted that the High Court ought to have

addressed itself to the maintainability of the suit and at this stage the

High Court was not required to consider at all on the validity of the

Compromise Decree.

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3.7 Number of other submissions have been made by learned counsel

appearing on behalf of the appellant on the validity of the Compromise

Decree. However, for the reasons stated hereinbelow, we propose to

consider the only issue with respect to maintainability of the suit and the

issue before this Court is not on the validity of the Compromise Decree,

therefore, we do not propose to deal with any of the submissions on

merits on the validity of the Compromise Decree.

4. Present appeals are vehemently opposed by Shri B. Adinarayana

Rao, learned Senior Advocate appearing on behalf of the original

plaintiff(s).

4.1 it is submitted that in the present case, the Compromise Decree is

hit by Order XXXII Rule 7 CPC. It is submitted that therefore on

attaining the majority immediately when respondent No.1 herein –

original plaintiff instituted a suit for various reliefs, which otherwise can

be granted in a substantive independent suit, the High Court has rightly

set aside the order passed by the Trial Court rejecting the plaint.

4.2 It is vehemently submitted by learned Senior Advocate appearing

on behalf of the original plaintiff that in the present case, the reliefs

prayed in the suit are not only with respect to the Compromise Decree,

but other reliefs are sought for which an independent substantive suit

shall be maintainable. It is submitted that as such the plaintiff has not

prayed to set aside the Compromise Decree. It is submitted that what is

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prayed is to declare that the Compromise Decree is not binding on him.

It is submitted that therefore for the other reliefs sought, it can be said

that an independent suit under Order XXIII Rule 3A shall not be barred.

4.3 However, the learned Senior Advocate appearing on behalf of the

respondents – original plaintiff(s) is not disputing that the plaintiff has

already filed an application under Order XXIII Rule 3A before the same

Court, which passed the Compromise Decree. He is also not in a

position to dispute that in the said application, the plaintiff can very well

make submission on the validity of the Compromise Decree on whatever

grounds, which may be available to him including non-compliance of

Order XXXII Rule 7 CPC.

5. We have heard the learned counsel appearing on behalf of the

respective parties at length.

6. At the outset, it is required to be noted that in the present case, the

Trial Court rejected the plaint of O.S. No.537 of 2018 in exercise of

powers under Order VII Rule 11 CPC on the ground that the said suit

would not be maintainable in view of specific bar under Order XXIII Rule

3A CPC. The High Court by the impugned judgment and order has set

aside the said order and has remanded the matter to the Trial Court by

observing that while passing the order rejecting the plaint, the Trial Court

had not considered the provisions of Order XXXII Rules 1 to 7 CPC.

However, it is required to be noted that while passing the impugned

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judgment and order, the High Court has not at all dealt with and

considered the provisions of Order XXIII Rule 3A CPC and has not

considered at all whether in fact the suit challenging the Compromise

Decree and/or for the reliefs sought in the suit would be maintainable or

not. What was required to be considered by the High Court was whether

the independent suit questioning the Compromise Decree would be

maintainable or not. The aforesaid crucial aspect has not been dealt

with by the High Court at all and High Court has gone into the validity of

the Compromise Decree in view of Order XXXII Rule 7 CPC. At the

stage of deciding the application under Order VII Rule 11 CPC, the only

thing which was required to be considered by the High Court was

whether the suit would be maintainable or not and that the suit

challenging the Compromise Decree would be maintainable or not in

view of Order XXIII Rule 3A CPC and at this stage, the High Court /

Court was not required to consider on merits the validity of the

Compromise Decree.

7. Now, so far as the main issue whether the Trial Court rightly

rejected the plaint in exercise of powers under Order VII Rule 11 CPC on

the ground that an independent suit challenging the Compromise Decree

would be barred in view of Order XXIII Rule 3A CPC is concerned, on

plain reading of Order XXIII Rule 3A CPC, the Trial Court was justified in

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rejecting the plaint. Order XXIII Rule 3A CPC, which has been inserted

by amendment in 1976 reads as under:-

“3A. 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.”

8. Therefore, on plain reading of Order XXIII Rule 3A CPC, no suit

shall lie to set aside a decree on the ground that the compromise on

which the decree is based was not lawful. Identical question came to be

considered by this Court in the case of R. Janakiammal (supra). It is

observed and held by this Court that Rule 3A of Order XXIII bars the suit

to set aside the decree on the ground that the compromise on which

decree was passed was not lawful. It is further observed and held that

an agreement or compromise which is clearly void or voidable shall not

be deemed to be lawful and the bar under Rule 3A shall be attracted if

compromise on the basis of which the decree was passed was void or

voidable. In this case, this Court had occasion to consider in detail

Order XXIII Rule 3 as well as Rule 3A. The earlier decisions of this

Court have also been dealt with by this Court in paragraphs 53 to 57 as

under:-

“53. Order 23 Rule 3 as well as Rule 3-A came for

consideration before this Court in large number of cases

and we need to refer to a few of them to find out the ratio

of judgments of this Court in context of Rule 3 and Rule 3-

A. In Banwari Lal v. Chando Devi, (1993) 1 SCC 581, this

Court considered Rule 3 as well as Rule 3-A of Order 23.

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This Court held that the object of the Amendment Act,

1976 is to compel the party challenging the compromise

to question the court which has recorded the compromise.

In paras 6 and 7, the following was laid down: (SCC pp.

584-85)

“6. The experience of the courts has been that

on many occasions parties having filed

petitions of compromise on basis of which

decrees are prepared, later for one reason or

other challenge the validity of such

compromise. For setting aside such decrees

suits used to be filed which dragged on for

years including appeals to different courts.

Keeping in view the predicament of the courts

and the public, several amendments have

been introduced in Order 23 of the Code

which contain provisions relating to withdrawal

and adjustment of suit by the Civil Procedure

Code (Amendment) Act, 1976. Rule 1 Order

23 of the Code prescribes that at any time

after the institution of the suit, the plaintiff may

abandon his suit or abandon a part of his

claim. Rule 1(3) provides that where the Court

is satisfied: (a) that a suit must fail by reason

of some formal defect, or (b) that there are

sufficient grounds for allowing the plaintiff to

institute a fresh suit for the subject-matter of a

suit or part of a claim, it may, on such terms

as it thinks fit, grant the plaintiff permission to

withdraw such suit with liberty to institute a

fresh suit. In view of Rule 1(4) if the plaintiff

abandons his suit or withdraws such suit

without permission referred to above, he shall

be precluded from instituting any such suit in

respect of such subject-matter. Rule 3 Order

23 which contained the procedure regarding

compromise of the suit was also amended to

curtail vexatious and tiring litigation while

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challenging a compromise decree. Not only in

Rule 3 some special requirements were

introduced before a compromise is recorded

by the court including that the lawful

agreement or a compromise must be in writing

and signed by the parties, a proviso with an

Explanation was also added which is as

follows:

‘Provided 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; but no adjournment shall be

granted for the purpose of deciding the

question, unless the Court, for reasons

to be recorded, thinks fit to grant such

adjournment.

Explanation. — An agreement or

compromise which is void or voidable

under the Indian Contract Act, 1872 (9

of 1872), shall not be deemed to be

lawful within the meaning of this Rule.’

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 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

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3 in order to avoid multiplicity of suit and

prolonged litigation, a specific bar was

prescribed by Rule 3-A in respect of institution

of a separate suit for setting aside a decree on

the 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.’

54. The next judgment to be noted is Pushpa Devi

Bhagat v. Rajinder Singh, (2006) 5 SCC 566, R.V.

Raveendran, J. speaking for the Court noted the

provisions of Order 23 Rule 3 and Rule 3-A and recorded

his conclusions in para 17 in the following words: (SCC p.

576)

“17. The position that emerges from the amended

provisions of Order 23 can be summed up thus:

(i) No appeal is maintainable against a

consent decree having regard to the specific

bar contained in Section 96(3) CPC.

(ii) No appeal is maintainable against the

order of the court recording the compromise

(or refusing to record a compromise) in view

of the deletion of clause (m) of Rule 1 Order

43.

(iii) No independent suit can be filed for setting

aside a compromise decree on the ground

that the compromise was not lawful in view of

the bar contained in Rule 3-A.

(iv) A consent decree operates as an estoppel

and is valid and binding unless it is set aside

by the court which passed the consent

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decree, by an order on an application under

the proviso to Rule 3 Order 23.

Therefore, the only remedy available to a party to a

consent decree to avoid such consent decree, is to

approach the court which recorded the compromise and

made a decree in terms of it, and establish that there was

no compromise. In that event, the court which recorded

the compromise will itself consider and decide the

question as to whether there was a valid compromise or

not. This is so because a consent decree is nothing but

contract between parties superimposed with the seal of

approval of the court. The validity of a consent decree

depends wholly on the validity of the agreement or

compromise on which it is made. The second defendant,

who challenged the consent compromise decree was fully

aware of this position as she filed an application for

setting aside the consent decree on 21-8-2001 by alleging

that there was no valid compromise in accordance with

law. Significantly, none of the other defendants

challenged the consent decree. For reasons best known

to herself, the second defendant within a few days

thereafter (that is on 27-8-2001) filed an appeal and

chose not to pursue the application filed before the court

which passed the consent decree. Such an appeal by the

second defendant was not maintainable, having regard to

the express bar contained in Section 96(3) of the Code.”

55. The next judgment is R. Rajanna v. S.R.

Venkataswamy, (2014) 15 SCC 471 in which the

provisions of Order 23 Rule 3 and Rule 3-A were again

considered. After extracting the aforesaid provisions, the

following was held by this Court in para 11: (SCC p. 474)

“11. It is manifest from a plain reading of the

above that in terms of the proviso to Order 23

Rule 3 where one party alleges and the other

denies adjustment or satisfaction of any suit

by a lawful agreement or compromise in

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writing and signed by the parties, the Court

before whom such question is raised, shall

decide the same. What is important is that in

terms of Explanation to Order 23 Rule 3, the

agreement or compromise shall not be

deemed to be lawful within the meaning of the

said Rule if the same is void or voidable under

the Contract Act, 1872. It follows that in every

case where the question arises whether or not

there has been a lawful agreement or

compromise in writing and signed by the

parties, the question whether the agreement

or compromise is lawful has to be determined

by the court concerned. What is lawful will in

turn depend upon whether the allegations

suggest any infirmity in the compromise and

the decree that would make the same void or

voidable under the Contract Act. More

importantly, Order 23 Rule 3-A clearly bars a

suit to set aside a decree on the ground that

the compromise on which the decree is based

was not lawful. This implies that no sooner a

question relating to lawfulness of the

agreement or compromise is raised before the

court that passed the decree on the basis of

any such agreement or compromise, it is that

court and that court alone who can examine

and determine that question. The court cannot

direct the parties to file a separate suit on the

subject for no such suit will lie in view of the

provisions of Order 23 Rule 3-A CPC. That is

precisely what has happened in the case at

hand. When the appellant filed OS No. 5326

of 2005 to challenge the validity of the

compromise decree, the court before whom

the suit came up rejected the plaint under

Order 7 Rule 11 CPC on the application made

by the respondents holding that such a suit

was barred by the provisions of Order 23 Rule

17

3-A CPC. Having thus got the plaint rejected,

the defendants (the respondents herein) could

hardly be heard to argue that the plaintiff (the

appellant herein) ought to pursue his remedy

against the compromise decree in pursuance

of OS No. 5326 of 2005 and if the plaint in the

suit has been rejected to pursue his remedy

against such rejection before a higher court.”

56. The judgments of Pushpa Devi [Pushpa Devi

Bhagat v. Rajinder Singh, (2006) 5 SCC 566] as well

as Banwari Lal [Banwari Lal v. Chando Devi, (1993) 1

SCC 581] were referred to and relied on by this Court.

This Court held that no sooner a question relating to

lawfulness of the agreement or compromise is raised

before the court that passed the decree on the basis of

any such agreement or compromise, it is that court and

that court alone which can examine and determine that

question.

57. In subsequent judgment, Triloki Nath Singh v. Anirudh

Singh, (2020) 6 SCC 629, this Court again referring to

earlier judgments reiterated the same proposition i.e. the

only remedy available to a party to a consent decree to

avoid such consent decree is to approach the court which

recorded the compromise and separate suit is not

maintainable. In paras 17 and 18, the following has been

laid down: (SCC p. 638)

“17. By introducing the amendment to the Civil

Procedure Code (Amendment) Act, 1976

w.e.f. 1-2-1977, the legislature has brought

into force Order 23 Rule 3-A, which creates

bar to institute the suit to set aside a decree

on the ground that the compromise on which

decree is based was not lawful. The purpose

of effecting a compromise between the parties

is to put an end to the various disputes

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pending before the court of competent

jurisdiction once and for all.

18. Finality of decisions is an underlying

principle of all adjudicating forums. Thus,

creation of further litigation should never be

the basis of a compromise between the

parties. Rule 3-A Order 23 CPC put a specific

bar that no suit shall lie to set aside a decree

on the ground that the compromise on which

the decree is based was not lawful. The

scheme of Order 23 Rule 3 CPC is to avoid

multiplicity of litigation and permit parties to

amicably come to a settlement which is lawful,

is in writing and a voluntary act on the part of

the parties. The court can be instrumental in

having an agreed compromise effected and

finality attached to the same. The court should

never be party to imposition of a compromise

upon an unwilling party, still open to be

questioned on an application under the

proviso to Order 23 Rule 3 CPC before the

court.”

That thereafter it is specifically observed and held that a party to a

consent decree based on a compromise to challenge the compromise

decree on the ground that the decree was not lawful i.e., it was void or

voidable has to approach the same court, which recorded the

compromise and a separate suit challenging the consent decree has

been held to be not maintainable.

9. In view of the above decisions of this Court, the Trial Court was

absolutely justified in rejecting the plaint on the ground that the suit for

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the reliefs sought challenging the Compromise Decree would not be

maintainable.

10. Now, so far as the submission on behalf of the plaintiff that in the

suit the plaintiff has not specifically prayed for setting aside the

Compromise Decree and what is prayed is to declare that the

Compromise Decree is not binding on him and that for the other reliefs

sought, the suit would not be barred and still the suit would be

maintainable is concerned, the aforesaid cannot be accepted.

10.1 As held by this Court in a catena of decisions right from 1977 that

a mere clever drafting would not permit the plaintiff to make the suit

maintainable which otherwise would not be maintainable and/or barred

by law. It has been consistently held by this Court that if clever drafting

of the plaint has created the illusion of a cause of action, the court will

nip it in the bud at the earliest so that bogus litigation will end at the

earlier stage.

10.2 In the case of T. Arivandandam Vs. T.V. Satyapal, (1977) 4 SCC

467, it is observed and held as under;-

“5. We have not the slightest hesitation in condemning the

petitioner for the gross abuse of the process of the court

repeatedly and unrepentantly resorted to. From the

statement of the facts found in the judgment of the High

Court, it is perfectly plain that the suit now pending before

the First Munsif's Court, Bangalore, is a flagrant misuse of

the mercies of the law in receiving plaints. The learned

Munsif must remember that if on a meaningful — not

formal — reading of the plaint it is manifestly vexatious,

20

and meritless, in the sense of not disclosing a clear right

to sue, he should exercise his power under Order 7 Rule

11 CPC taking care to see that the ground mentioned

therein is fulfilled. And, if clever drafting has created the

illusion of a cause of action, nip it in the bud at the first

hearing by examining the party searchingly under Order

10 CPC. An activist Judge is the answer to irresponsible

law suits.”

10.3 In the case of Ram Singh v. Gram Panchayat Mehal Kalan,

(1986) 4 SCC 364, this Court has observed and held that when the suit

is barred by any law, the plaintiff cannot be allowed to circumvent that

provision by means of clever drafting so as to avoid mention of those

circumstances, by which the suit is barred by law of limitation.

11. If we consider the reliefs of declaration of title, recovery of

possession, cancellation of revocation of Gift Deed, declaration for

DGPA and Deed of Assignment-cum-DGPA, the said reliefs can be

granted only if the Compromise Decree dated 13.01.2016 passed in

O.S. No.1750 of 2015 is set aside. Therefore, by asking such multiple

reliefs, the plaintiff by clever drafting wants to get his suit maintainable,

which otherwise would not be maintainable questioning the Compromise

Decree. All the aforesaid reliefs were subject matter of earlier suits and

thereafter also subject matter of O.S. No.1750 of 2015 in which the

Compromise Decree has been passed. Therefore, it is rightly held by

the Trial Court that the suit in the present form and for the reliefs sought

would be barred under Order XXIII Rule 3A CPC and therefore the Trial

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Court rightly rejected the plaint in exercise of powers under Order VII

Rule 11(d) of the CPC. The High Court has erred in setting aside the

said order by entering into the merits of the validity of the Compromise

Decree on the ground that the same was hit by Order XXXII Rule 7 CPC,

which was not permissible at this stage of deciding the application under

Order VII Rule 11 CPC and the only issue which was required to be

considered by the High Court was whether the suit challenging the

Compromise Decree would be maintainable or not.

12. As observed hereinabove and it is not in dispute that as such the

respondent No.1 – original plaintiff has already moved an appropriate

application before the concerned Court, which passed the decree setting

aside the compromise Decree by submitting an application under Order

XXIII Rule 3A CPC therefore the said application will have to be decided

and disposed of in accordance with law in which all the defences /

contentions which may have been available to the respective parties on

the validity of the Compromise Decree would have to be gone into by the

concerned court in accordance with law and on its own merits.

13. In view of the above and for the reasons stated above, the present

appeals succeed. The impugned judgment and order passed by the

High Court allowing the appeal and quashing and setting aside the order

passed by the II Additional District Judge, Ranga Reddy District passed

on 02.05.2019 in I.A. No. 108 of 2019 in O.S. No.537 of 2018 is hereby

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quashed and set aside. The order passed by the Trial Court dated

02.05.2019 in I.A. No.108 of 2019 in O.S. No. 537 of 2018 rejecting the

plaint is hereby restored. However, it is observed that we have not

expressed anything on merits on validity of the Compromise Decree and

the same shall have to be decided and considered by the Court which

passed the decree in an application under Order XXIII Rule 3A CPC,

which as observed hereinabove has been filed by the original plaintiff

and the said application be decided and disposed of by the concerned

Court in accordance with law and on its own merits and the

contentions/defences which may be available to the respective parties

on the validity of the Compromise Decree are kept open to be

considered by the concerned Court in accordance with law and on its

own merits.

Present appeals are allowed accordingly. However, in the facts

and circumstances of the case, there shall be no order as to costs.

Pending application(s), if any, also stand disposed of.

………………………………….J.

 [M.R. SHAH]

NEW DELHI; ………………………………….J.

FEBRUARY 09, 2022. [SANJIV KHANNA]

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Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले