Hemantha Kumar Versus R. Mahadevaiah & Ors

Hemantha Kumar Versus R. Mahadevaiah & Ors

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले



REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4108 OF 2022
Hemantha Kumar …Appellant(s)
Versus
R. Mahadevaiah & 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 passed by the High Court of Karnataka at Bengaluru in Writ
Petition No. 35073 of 2015 by which the High Court has set aside the
consent decree passed in the Lok Adalat and consequently has restored
the original suit, original plaintiff has preferred the present appeal.
2. The facts leading to the present appeal in a nutshell are as under:-
2.1 That the appellant herein – original plaintiff instituted Original Suit
No. 94 of 2006 in the Court of learned Civil Judge (Sr. Dn.) at Kunigal for
specific performance of the agreement to sell/contract. The suit
originally was filed against three defendants, however, one of the
defendants – defendant No. 3 came to be deleted by the plaintiff. The
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suit came up for hearing before the learned Trial Court on 18.08.2007.
The plaintiff and the original defendant Nos. 1 and 2 submitted an
application under Order XXIII Rule 3 CPC, in which it was stated that the
parties have settled the dispute and it was requested to pass a consent
decree. The defendant Nos. 1 and 2 admitted execution of the
agreement to sell dated 26.04.2005 in favour of the plaintiff and also
admitted receipt of Rs. 30,000/- towards the part sale consideration. In
the application under Order XXIII Rule 3 CPC, it was specifically stated
that the defendant Nos. 1 and 2 have received the remaining sale
consideration amount of Rs. 70,000/- from the plaintiff. Therefore, it was
requested to pass the decree as prayed for in the suit as well as in terms
of the compromise petition.
2.2 The said consent compromise/compromise deed/compromise
petition was signed by the Advocates for the respective parties.
However, instead of decreeing the suit passing a consent decree though
requested, the learned Trial Court referred the matter to Lok Adalat.
Before the Lok Adalat, which was presided over by the very learned Civil
Judge (Sr. Dn.), Kunigal, the Advocates for the plaintiff as well as the
original defendant Nos. 1 and 2 remained present and prayed to pass a
consent decree as per the application under Order XXIII Rule 3 CPC.
Consequently, by judgment and decree dated 27.08.2007, the learned
Trial Court passed the consent decree.
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2.3 That thereafter the original plaintiff filed the Execution Petition No.
88 of 2013 to execute the consent decree and for seeking execution of
the sale deed in his favour. That thereafter, the defendant Nos. 1 and 2
filed the writ petition before the High Court being Writ Petition No. 35073
of 2015 challenging the consent decree passed by the Court of Lok
Adalat on the ground that the consent decree was obtained by fraud.
2.4 By the impugned judgment and order, the learned Single of the
High Court has allowed the said writ petition and set aside the consent
decree passed by the learned Trial Court passed in the Lok Adalat. This
is mainly on the ground that looking to the compromise amongst the
parties and the dates and events, prima facie it is evident that counsel
for the plaintiff must have mislead the Trial Court in obtaining the decree
on 18.8.2007 while referring the matter to Lok-Adalat r/w the
compromise and drawing up of decree. By observing so, the High Court
has set aside the consent decree passed by the learned Trial Court
passed in the Lok Adalat and directed to restore the original suit to the
file and the learned Trial Court has directed to re-commence the
proceedings from the date of referring the matter to the Lok Adalat.
2.5 Feeling aggrieved and dissatisfied with the impugned judgment
and order passed by the High Court, the original plaintiff has preferred
the present appeal.
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3. Learned counsel appearing on behalf of the appellant – original
plaintiff has vehemently submitted that in fact the plaintiff and the
defendant Nos. 1 and 2 jointly submitted the application under Order
XXIII Rule 3 CPC before the learned Trial Court and requested the
learned Trial Court to pass a consent decree. It is submitted that,
however, instead of passing the consent decree, the learned Trial Court
referred the matter to the Lok Adalat. It is contended that merely
because the matter was referred to the Lok Adalat cannot be a ground to
doubt the genuineness of the consent decree/consent compromise and
also the filing of the application under Order XXIII Rule 3 CPC.
3.1 It is further submitted by the learned counsel appearing on behalf
of the appellant – original plaintiff that in fact the defendant Nos. 1 and 2
received the balance sale consideration of Rs. 70,000/- as mentioned in
the consent application/application under Order XXIII Rule 3 CPC.
3.2 It is further submitted that before the learned Trial Court as well as
the Lok Adalat, which was presided over by the very learned Presiding
Judge, learned Advocates appearing on behalf of the respective parties
appeared and prayed to pass a consent decree on the basis of the
application filed under Order XXIII Rule 3 CPC and only thereafter the
learned Trial Court in the Lok Adalat passed the consent decree. It is
submitted that therefore, there was no reason for the High Court to doubt
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the genuineness. It is submitted that as such while passing the
impugned judgment and order and quashing and setting aside the
consent decree passed in the Lok Adalat, the High Court has observed
that looking to the compromise amongst the parties and the dates and
events, prima facie it is evident that counsel for the plaintiff must have
mislead the Trial Court in obtaining the decree on 18.8.2007 by referring
the matter to the Lok-Adalat r/w the compromise and drawing up of
decree. It is submitted that as such, such observations are not
warranted at all. That even otherwise the observations were not prima
facie in nature. The High Court has observed that the counsel for the
plaintiff mislead the Trial Court, however, what about the Advocates for
the defendant Nos. 1 and 2, who signed the application under Order
XXIII Rule 3 CPC and appeared before the learned Trial Court and even
appeared before the Lok Adalat. It is submitted that there are no
allegations and/or observations against the Advocates for the defendant
Nos. 1 and 2. It is submitted that in that view of the matter, the High
Court has erred in setting aside the consent decree passed by the
learned Trial Court passed in the Lok Adalat.
4. Present appeal is vehemently opposed by Shri S.N. Bhat, learned
Senior Advocate appearing on behalf of the respondents – original
defendant Nos. 1 and 2. It is vehemently submitted by Shri Bhat,
learned Senior Advocate, appearing on behalf of the defendant Nos. 1
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and 2 that as such the chronology of dates and events creates serious
doubt about the genuineness of the consent compromise/consent
decree. It is contended that first of all, the plaintiff deleted the defendant
No. 3 and the suit came to be dismissed qua defendant No. 3. That
immediately thereafter Order XXIII Rule 3 application was submitted.
That as such once there was an application under Order XXIII Rule 3
CPC and the parties agreed and requested to pass the consent decree,
there was no reason for the learned Trial Court to refer the matter to Lok
Adalat. It is submitted that therefore, the decree not being passed by
the learned Trial Court and referring of the matter to the Lok Adalat itself
creates serious doubt. It is submitted that therefore when the defendant
Nos. 1 and 2 alleged fraud, the defendant Nos. 1 and 2 should have
been given the opportunity to prove the alleged fraud.
4.1 Making above submissions, it is submitted that the High Court has
not committed any error in quashing and setting aside the consent
decree obtained by the plaintiff in the Lok Adalat. Therefore, it is
requested to dismiss the present appeal.
5. We have heard the learned counsel appearing for the respective
parties at length and perused the impugned judgment and order passed
by the High Court. We have also gone through the relevant material on
record. We have minutely considered the dates and events, which led to
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the passing of the consent decree in the Lok Adalat presided over by the
learned Trial Court.
6. At the outset, it is required to be noted that as such the plaintiff and
the defendant Nos. 1 and 2 and their Advocates filed the application
before the learned Trial Court under Order XXIII Rule 3 CPC and
requested to pass a consent decree submitting that the parties have
settled the disputes. Filing of the application under Order XXIII Rule 3
CPC is not disputed by the defendant Nos. 1 and 2. That thereafter
instead of passing the consent decree on the basis of the application
filed under Order XXIII Rule 3 CPC as requested and prayed, for
whatever reason, the learned Trial Court referred the matter to the Lok
Adalat. Before the Lok Adalat, the learned Advocates appearing on
behalf of the plaintiff and defendant Nos. 1 and 2 appeared and they
requested to pass the consent decree and accordingly in the Lok Adalat,
which was presided over by the very learned Judge, a consent decree
came to be passed. Merely because the learned Trial Court, before
whom the application was presented, referred the matter to the Lok
Adalat, cannot be a ground to doubt the genuineness of the consent
decree. Many a time, it happens that for whatever reason, instead of
passing the decree/consent decree in the Court, the matter is referred to
the Lok Adalat and directed to be placed before the Lok Adalat and
therefore, a consent decree was passed as prayed by the parties. The
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aforesaid procedure adopted in the instant case cannot be a ground to
doubt the genuineness of the consent decree. From the aforesaid, it
cannot be said that there was a fraud committed and/or the counsel on
behalf of the plaintiff to mislead the Court to refer the matter to the Lok
Adalat. The matter was referred to the Lok Adalat by the Court and even
the Lok Adalat was presided over by the very same learned Trial Court
Judge. Therefore, as such, the High Court has committed a
grave/serious error in doubting the consent decree.
7. Even otherwise, it is required to be noted that while setting aside
the consent decree passed in the Lok Adalat, the High Court has
observed in paragraph 6 as under:-
“6. Writ petition could not have been entertained in view
of the fact that O.S. No. 94/2006 was referred to LokAdalath and ordered to draw decree on 18.8.2007 while
referring to the Lok-Adalath on 30.7.2007. However,
compromise among the parties and dates and events
prima-facie it is evident that counsel for the plaintiff must
have mislead the trial Court in obtaining decree on
18.8.2007 with reference to referring the matter to LokAdalath r/w the compromise and drawing up of
decree…..”
8. Therefore, the High Court has observed that the counsel for the
plaintiff must have mislead the Trial Court in obtaining the decree on
18.8.2007 with reference to referring the matter to Lok-Adalat r/w the
compromise and drawing up of decree. On what basis and/or the
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material, the High Court has observed so and that too ‘prima facie’,
cannot be appreciated by us. Though, the High Court has commented
about the counsel for the plaintiff, however, the High Court has not at all
appreciated the fact that the application under Order XXIII Rule
3/consent application was presented and signed by the Advocates for
the defendant Nos. 1 and 2 also the parties, who had also appeared
before the learned Trial Court as well as before the Lok Adalat. There
are no allegations at all against the counsel appearing on behalf of the
defendant Nos. 1 and 2.
9. It is also to be noted that neither are there any observations by the
High Court that on submitting the application under Order XXIII Rule 3
CPC before the learned Trial Court and requesting for passing the
consent decree, defendant Nos. 1 and 2 had objected to submitting the
application under Order XXIII Rule 3/consent application in which it was
requested to pass a consent decree. It is to be noted that in the
application under Order XXIII Rule 3 CPC, it was further stated that
defendant Nos. 1 and 2 have been paid the balance sum of
Rs. 70,000/-. It is not the case on behalf of the defendant Nos. 1 and 2
that they have not received the balance sale consideration of
Rs. 70,000/- as mentioned in the consent application / application under
Order XXIII Rule 3 CPC.
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10. In view of the above, the High Court has committed a
grave/serious error in setting aside the consent decree dated 18.08.2007
passed in the Lok Adalat, which was presided over by the very learned
Trial Court Judge. The impugned judgment and order passed by the
High Court is unsustainable, both in law as well as on facts.
Under the circumstances, the impugned judgment and order dated
30.11.2020 passed by the High Court in Writ Petition No. 35073 of 2015
is hereby quashed and set aside. The consent decree passed by the
learned Trial Court passed in the Lok Adalat is hereby restored.
Present Appeal is Allowed accordingly. However, in the facts and
circumstances of the case, there shall be no order as to costs.
………………………………….J.
 [M.R. SHAH]
NEW DELHI; ………………………………….J.
JULY 11, 2022. [B.V. NAGARATHNA]
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