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Akhil Mansuklal Mehta v/s Sheetal Deepak Karamchandani


Company & Directors' Information:- AKHIL INDIA PRIVATE LIMITED [Active] CIN = U51109JK2000PTC002046

Company & Directors' Information:- AKHIL CORPORATION PRIVATE LIMITED [Under Process of Striking Off] CIN = U74900TG2015PTC098902

    Writ Petition No. 7187 of 2012 With Civil Application No. 11430 of 2012

    Decided On, 29 January 2013

    At, In the High Court of Bombay at Aurangabad

    By, THE HONOURABLE MR. JUSTICE S.S. SHINDE

    For the Petitioner: P.M. Shah, senior counsel i/b Gulam Dastgir Shaikh, Advocate. For the Respondent: R.R. Mantri h/f R.R. Sancheti, Advocates.



Judgment Text

1. Rule. Rule made returnable forthwith. By consent, heard finally.

2. This writ petition is filed challenging the order dated 20.7.2012, passed below Exh.17 in R.C.S. No. 330 of 2012, by the learned C. J. J. D. Rahata, District Ahmednagar.

3. It is the case of the petitioner that on 24.9.1996, the petitioner and respondent purchased (first) property bearing old survey No. 51/4 (new 51/5) situated at Shirdi, Tq. Rahata, District Ahmednagar, for consideration of Rs.4,50,00/- and the names the petitioner and the respondent are mutated in the revenue record. Thereafter, they purchased (second) property admeasuring 18 R out of 44 R from survey No. 51/1 situated at Shirdi, Tq. Rahata, District Ahmednagar for consideration of Rs.1,26,000/- (second property) out of the funds of the petitioner himself and his name is also mutated in the 7x12 extract. It is further case of the petitioner that the petitioner alongwith respondent purchased jointly (third) property at village Vihigaon, Tq. Shahapur, District Thane from survey No. 351 admeasuring 1 H 48 R and survey No. 352 admeasuring 2H from the same village, jointly in the name of the petitioner and the respondent. The said properties was purchased during the period from 24.11.1996 to 17.4.1998.

4. It is the case of the petitioner that the petitioner had faced with some financial crises, therefore, he sold 50% share from the third party to one Prakash Dwarkadas Jhunjhunwala on 25.2.2011 for consideration and remaining 50% share of the respondent was kept as it is. It is further case of the petitioner that on 20.11.2011 respondent lodged a complaint with Kasara police station and on 9.3.2012 F.I.R. No. I-13 of 2012 came to be registered and the petitioner was arrested and sent to judicial custody on 17.3.2012 by the learned J.M.F.C. Shahapur. It is further case of the petitioner that on 12.4.2012 the learned Sessions Judge at Kalyan, has released the petitioner after one month on bail, on condition to attend Kasara police station on 15th and 25th of every month between 10.00 a.m. to 12.00 noon until further orders. It is further case of the petitioner that, as the petitioner was harassed and abused by investigating officer, Kasara police station, he filed an application to Sessions Judge at Kalyan and accordingly police station is changed from Kasara to Mahatma Phule police station, vide order dated 16.6.2012.

It is further case of the petitioner that on 7.3.2012, the respondent filed second complaint to police station Shirdi with a contention that she has purchased the second property out of her own funds and further falsely contended that the petitioner is trying to dispose of the first and second property by preparing fraudulent documents. The respondent herein filed R.C.S. No. 330 of 2012 in the Court of learned C.J.J.D. Rahata for declaration and injunction in respect of the suit property. It is the case of the petitioner that the respondent approached the petitioner and stated that she is ready to withdraw the complaint with Kasara police station and further expressed her willingness to purchase the share of the petitioner in the first and second properties and also offered to settle the dispute regarding 3rd property by stating that release deed should be executed and accordingly it was informed by her to the petitioner to come to court at Rahata. It is further case of the petitioner that on 11.6.2012, the respondent took the petitioner to the premises of Rahata civil court and orally informed about pendency of the suit and filing of consent terms. It is further case of the petitioner that the petitioner was tuted by respondent to sign on each and every papers and respondent also engaged advocate for the petitioner. The said advocate was not paid any fees by the petitioner nor the petitioner known the advocate nor he was willfully engaged. On the same, pursis is filed by advocate regarding the waiver of summons and also got executed the consent deed by playing fraud, exercising coercion and undue influence on the petitioner. It is further case of the petitioner that on 11.6.2012 itself the petitioner was taken to Sub Registrar’s office by respondent and under pressure, a registered sale deed was executed by respondent in her name. It is further case of the petitioner that on same day, respondent took the petitioner to the office of notary public and during the course journey, the respondent threatened the petitioner in case the petitioner refused to sign the documents and also threatened that the respondent shall pursue the criminal complaint dated 7.3.2012 in the same manner, as it was done with Kasara police station. It is the case of the petitioner that because of force and undue influence and threatening, the petitioner was forced to sign on blank paper with intention to grab the share of the petitioner. On the same day, the petitioner signed two deeds of release, one of the first property and second is of the third party because of threats and force by the respondent.

It is further case of the petitioner that on 19.6.2012, upon proper legal advice the petitioner filed an application Exh.17 before the Civil Court at Rahata in R.C.S. No. 330 of 2012, objecting to the documents of consent terms. The learned trial judge ordered to issue notice. The respondent appeared in the matter and filed her reply to application Exh.17 and prayed to reject the application Exh.17. By the impugned order dated 20.6.2012, application Exh.17 came to be rejected by the learned C.J.J.D. Rahata and the matter was kept for further arguments on 17.8.2012. Being aggrieved by the said order passed below Exh.17, the petitioner has filed this writ petition under Article 227 of the Constitution of India.

5. Learned senior counsel appearing for the petitioner submits that the trial court has erred in not appreciating the provisions of Order XXIII Rule 3 of C.P.C. which clearly contemplates that before passing the compromise decree, the court must satisfy itself that suit has been adjusted wholly or in part by any lawful agreement or compromise. It is submitted that, when the petitioner has filed objection at Exh.17 and raised question to the genuineness of the consent terms and raised allegations against the plaintiff and created doubts of the consent terms then in such case, the learned judge has erred in not appreciating that the provisions of Order XXII Rule 3 of C.P.C. clearly contemplated that agreement or terms which is void or voidable under the Indian Contract Act 1872 shall not be deemed to be lawful and therefore, instead of rejecting the application at Exh.17, the trial court ought to have conducted proper enquiry in the suit. It is submitted that consent terms are not obtained by free consent of the petitioner. Hence, complete adjudication is necessary and instead the trial court without adjudication has given such findings, which are premature.

It is submitted that the respondent has obtained signature of the petitioner on two deeds of release through coercion, fraud and undue influence, hence under such circumstance, full-fledged trial was necessary but instead the trial judge directly rejected the application, as if delivering the final verdict after completion of evidence. It is submitted that the trial court has erred in not appreciating that all documents i.e. Vakilpatra, pursis of appearance, consent terms, deed of conveyance, deed of release, have been executed on the same day i.e. on 11.6.2012. Hence such circumstances lead to fraudulent attitude of the respondent to grab the property of Crores of rupees. It is submitted that the trial judge has erred in not appreciating that the petitioner did not read over the contents of the said document executed by the petitioner in favour of the respondent.

It is submitted that the trial judge erred in not appreciating that the consideration paid to the petitioner, as disclosed in the consent terms, and is the amount paid to him under the deed of conveyance for the said second property, which is much lesser than the share, right, title and interest in the said first property. The trial judge has also erred in not appreciating that consideration paid to the petitioner, as disclosed in the consent terms, is nearly equivalent to the market value as per the ready reckoner available for the said second property and in no way concerned with the said first property. It is submitted that the trial judge has erred in not appreciating that the petitioner had paid 50% of the purchase price i.e. Rs.2,25,000/- for purchasing the first property on 24.9.1996. It is submitted that the trial judge has erred in not appreciating that although the petitioner was paid a sum of Rs.1,45,000/- i.e. nearly equivalent market value for the conveyance of the said second property admeasuring 18 gunthas, the petitioner has not been paid any consideration for release of 50% undivided share right, title and interest in the said first property, which is equivalent to 48 gunthas.

It is submitted that the trial judge has erred in not appreciating that although the law requires that the said Deed of Release should be duly registered and although the petitioner present himself for registration of the said deed of conveyance, the Deed is Release is not registered before Sub Registrar on Assurances at Rahata. It is submitted that the trial court has not appreciated that the said Deed of Release does not bear proper stamp duty as contemplated in Bombay Stamp Act. It is submitted that the trial judge has wrongly held that there is no mention of criminal complaint filed by the respondent against the petitioner in the proceeding before the trial court, in as much as, the respondent has herself in para 7 of the plaint admitted the said fact even in the reply to her the same has not been denied. Learned senior counsel invited my attention to the contents of the compromise deed and submitted that as per the consent terms the release of the property from survey No. 51/4 at Shirdi, Tq. Rahata, District Ahmednagar, no consideration has been paid by the respondent to the petitioner. It is submitted that the criminal complaints were filed by the respondent in which the petitioner was lodged in jail for some time and thereafter the Sessions Court released him on bail.

It is submitted that it is clear from the documents placed on record that the petitioner has applied for relaxation of condition of bail after such consent terms are executed. It is submitted that it is only under coercion and threats by the respondent, such consent terms are signed by the petitioner. Learned senior counsel for the petitioner further submits that the remedy to file application for cancellation of such consent terms which are obtained by fraud and undue influence of coercion, is only under Order 23 Rule 3 of C.P.C. In view of provisions of Rule 3-A of Order 23, the petitioner cannot file any independent suit or any other proceedings. Learned senior counsel for the petitioner pressed into service a reported judgment of the Calcutta High Court in the case of Sm. Sumitra Devi Agarwalla v. Sm Sulekha Kundu and another, reported in AIR 1976 Cal. 196 (1) and submitted that the term 'lawful agreement' in order 23 Rule 3 does not include with it, agreement which is initiated by fraud, undue influence or coercion. The learned senior counsel invited my attention to paragraphs 8 and 9 of the said judgment and submitted that consent terms are signed by the petitioner by force and coercion.

Learned senior counsel further pressed into service, reported judgment of the Punjab and Haryana High Court in the case of ChandKaur vs. Raj kaur (died) and others, reported in AIR 1997 PH 155 and submitted that the condition which normally must be satisfied for validly invoking the provisions of Order 23 Rule 3 of C.P.C. and for passing of such decree, firstly, there should be lawful agreement of compromise, secondly, the compromise has to be in writing and signed by the parties, thirdly, the compromise must be recorded by the court and, fourthly, the decree on such compromise can be passed so far it relates to the parties to the suit but may extend to a special matter which is not the subject matter of the suit. Learned counsel invited my attention to paragraphs 8, 9, 10 and 13 of the said judgment and submitted that, applying the principles laid down in the said judgment, in the facts of the present case, consent decree does not satisfy the conditions as held by the Court in para 10 of the said judgment. Learned counsel also submitted that consent terms are also not registered and no proper stamp duty is paid. He also pressed into service an exposition of the Supreme Court in the case of Banwarilalvs. Chando Devi (Smt.) (through L.Rs.) and another, reported in (1993) 1 SCC 581 and submitted that the Supreme Court on interpretation of the provisions of Order 23 Rule 3, proviso to explanation 1 and 3-A, Order 43 Rule 1-A (2) and Sections 96(1), (3) and 151 of C.P.C. has taken a view that the compromise suit must be lawful and signed by the parties. Where contract itself is fraudulent, it is void and unlawful. Whether compromise lawful or void or voidable to be decided by the same court which entertained the compromise petition. The Compromise decree is open for challenge under Order 23 Rule 3 or in appeal under Section 96(1) on the ground that compromise had not been arrived at lawfully and as such should not have been recorded. Learned senior counsel invited my attention to para 7 of the said judgment and submitted that the compromise terms which are recorded are not in form of provisions of Order 23 Rule 3 and also other relevant provisions and also law laid down by various High Courts and Supreme Court and therefore, the application at Exh.17 filed by the petitioner ought to have been allowed by the trial court. It is submitted that consent terms is a result of fraud, coercion played by the respondent and therefore, application Exh.17 for cancellation of compromise terms should have been allowed by the trial court.

6. On the other hand, learned counsel appearing for the respondent relied upon the reasons recorded by the trial court for rejecting application at Exh.17 and submitted that, the petitioner has not only signed the consent terms but also conveyance deed, affidavit before the public notary and therefore, it cannot be said that there is element of coercion or fraud as alleged by the petitioner. It is submitted that as per the compromise terms in respect of land survey No. 51/2A, conveyance deed is executed and amount of Rs. 1 Crores 45 lacs is received by the petitioner herein. The consent terms also recorded that the property bearing survey No. 51/4 at Shirdi, Tq. Rahata, District Ahmednagar shall be released by the defendant in favour of the plaintiff. It is submitted that the court has verified the terms of compromise and also the signatures of the parties and also signatures of the advocates. The parties were present before the court, they were represented by the advocates and the court has recorded the compromise after satisfying itself that, the parties have consented for the compromise by filing pursis. The compromise pursis were read and recorded by the Court. It is further submitted that when the compromise terms are acted upon and admittedly the petitioner has received an amount of Rs.1 Crore and 45 lacs for the property bearing survey No. 51/2A, situated at Shirdi, Tq Rahata, District Ahmednagar, towards consideration vide Pay Order, then it cannot be said that such consent terms were under the influence of coercion or by playing fraud. The learned counsel pressed into service reported judgment of this Court in case of LatabaiNarcinha Telang vs. Suresh Narcinha Telang and another, reported in 2006 (1) Mh.L.J. 440 and submitted that this court while interpreting the provisions of Order 23 Rule 3 of C.P.C. held that it is only in those cases, where the consent terms, as a whole, challenged on the ground of fraud, misrepresentation or on similar grounds, then the Court has to decide, whether challenge is sustainable. The party cannot seek modification of clause in the consent terms and consequently that part of the decree on the ground that the same was not intended or agreed by the parties. Therefore, learned counsel appearing for the respondent relying upon the reasons recorded by the trial court, affidavit in reply and reply filed before the trial court and oral submissions advanced before this Court would submit that this petition is devoid of any merits and the same be rejected.

7. I have given due consideration to the rival submissions advanced by the respective advocates. With the assistance of the learned counsel for the parties, I have perused the pleadings in the petition, annexures thereto and other material placed on record by respective parties, including the additional documents and reply filed by the respondent herein before the trial court to application Exh.17, relevant provisions of C.P.C., judgments cited by both sides. At the outset, it would be apposite to reproduce herein below the provisions of Order 23 Rule 3-A of C.P.C., which reads thus:-

ORDER XXIII

'Rule 1 ....

Rule 2 .....

Rule 3 .....

[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.'

8. The Punjab and Haryana High Court in the case of ChandKaur (supra), in paragraph 10 has laid down conditions which normally must be satisfied for validly invoking the provisions of Order 23 Rule 3 of C.P.C. and for passing of such decree. The said conditions are as under:-

i) There should be a lawful agreement or compromise;

ii) This compromise has to be in writing and signed by the parties;

iii) The compromise must be recorded by the Court.

iv) A decree on such compromise can be passed so far it relates to the parties to the suit but may extend to a special matter which is not the subject matter of the suit.

In the facts of the present case, it is admitted position that in pursuance to the consent terms the petitioner has received consideration of Rs.1 Crores and 45 lacs for the property bearing survey No. 51/2A situated at Shirdi, Tq. Rahata, District Ahmednagar as per clause No.3 of the consent terms. The said amount is received by the petitioner vide Pay order No. 089063 dated 6.6.2012 drawn on H.D.F.C. Bank Limited Varsova Road Branch, being entire consideration as within mentioned paid to the petitioner. A Photostat copy of the receipt is placed on record at page 105 of the compilation. Upon careful perusal of the copy of the consent terms, it is abundantly clear that the consent terms are signed by the parties and also their respective advocates. The said consent terms are recorded by the Court at pages 12 and 13 of the impugned order.

9. Therefore, in the facts of this case, the consent terms are signed by the parties and their respective advocates. The compromise is recorded by the Court. The parties were present before the Court. Their respective advocates were also present before the Court when the court has read and recorded the compromises. Therefore, it appears that mandate of Order 23 Rule 3 of C.P.C. is fulfilled in the present case.

The consent terms are signed on 11.6.2012, copy of the said consent terms is placed on record at Exh.12 at page 92 of the compilation of the writ petition. There are signatures of the parties and after signatures there are photographs of the petitioner and the respondent. There is also stamp of the court at Exh.13 at page 93 of the compilation of the petition. There is copy of deed of conveyance executed between the respondent and the petitioner before the office of Sub Registrar at Rahata, District Ahmednagar. It appears that on the said conveyance deed there is seal of the Registrar. All particulars are mentioned including the copy of receipt of receiving amount of Rs.1 Crores and 45 lacs by the present petitioner from the respondent. At Exh.14 page 114 of the compilation, there is release deed in favour of respondent by the petitioner. The said document is also signed and notary has placed the seal on the said document. At page 118, there is photograph of the parties and also signatures are appearing. Upon careful perusal of the impugned judgment and order, it is crystal clear that the court has, in detail, considered the submissions of the parties and also adverted to the provisions of Contract Act, other relevant provisions and the judgments cited by the parties and rejected the application Exh.17 filed by the petitioner. The findings recorded by the trial court are in consonance with the material placed on record. The court has considered the every aspects of the matter and this court is in agreement with the findings recorded by the trial court.

10. The reliance placed by the counsel for the petitioner in the case of Banwarilal(supra) is misplaced in the facts of the present case. In the facts of that case, the compromise was not signed by the parties. Therefore, the trial court allowed the application for cancellation of the compromise terms. The said order was assailed before the High Court and the High Court reversed the order of the trial court. Being aggrieved, the parties approached the Supreme Court and in the facts of that case, the Supreme Court held that the petition for compromise must be signed by the parties concerned. In the facts of that case, the court found that the trial court recorded the alleged agreement or compromise in casual manner. However, in the facts of the present case, compromise terms are not only signed by the parties but their advocates also, those are verified in presence of the parties and advocates. The said terms of the compromise were read over to the parties and after due exercise, as contemplated under relevant provisions, the compromise terms are recorded. Admittedly, the petitioner has received amount of Rs.1 Crores and 45 Lacs towards consideration by Pay order. There is conveyance deed, affidavit before Notary and all these actions of petitioner would lead to only conclusion that there was no element of fraud or coercion involved when the terms of compromise were arrived between the parties and subsequently recorded.

11. By introducing the amendment to the C.P.C. (Amendment) 1976 w.e.f. 1.2.1977, the Legislature have brought into force Rule 3-A to Order 23, 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 Punjab and Haryana High Court in the case of ChandKaur (supra) while interpreting the provisions of Order 23 Rule 3 and 3-A in para 11 and 12, held as under:-

'11. The explanation to sub-rule (3) of Rule 23 of the Code further makes legislative intent more clear by specifying 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 Rule. The purpose of effecting a compromise between the parties is to put an end to the various disputes pending before the Court of competent jurisdiction fully and finally.

12. 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) of Order 23 of the Code further 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. The scheme of Order 23, Rule 3 of the Code 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.' (Emphasis supplied).

It follows from the provisions of Rule 3-A of Order 23 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 of the Code 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.

12. Therefore, in the facts and circumstances of this case, as stated earlier, the consent terms arrived at between the petitioner and the respondent, are in consonance with the relevant provisions of C.P.C. as held by the trial Court, which needs no interference by this Court.

13. At this juncture, it would be worthwhile to refer the decision of this Court in the case of Latabai(supra), which takes a following view on interpretation of provisions of Order 23, Rule 3 of C.P.C. :-

'The proviso to Order 23, Rule 3 of the Code of Civil Procedure provides that where it is alleged by one part 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. Bare reading of the said proviso makes it clear that it is only when adjustment and satisfaction is alleged by one party and denied by the other side, the question of setting aside the consent decree arises. It is only in those cases where the consent terms, as a whole, on the ground of fraud, misrepresentation or on similar grounds are challenged, then the Court has to decide the issue. The submission that in an application under Order 23, Rule 3, a party can seek modification of clause in the consent terms and consequently t

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hat part of the Decree on the ground that the same was not intended or agreed by the parties cannot be accepted. If argument is accepted, in a suit or in an appeal where consent terms are filed and consequently a consent decree is passed, any party thereto will be entitled to file an application under Order 23, Rule 3, Civil Procedure Code for modifying a clause in the consent terms and consequently that part of the consent decree on the ground that it was not intended to or was inserted by mistake. If such an interpretation is accepted, the same would lead to strange result and the proviso to Order 23, Rule 3, Civil Procedure Code is not available to a party who was not intended to or that it was inserted by mistake. The explanation to Order 23, Rule 3 does not advance the case any further. It is inconceivable that a party can be permitted to file an application for modifying a clause in the consent terms and consequently that part of the consent decree under Order 23, Rule 3, Civil Procedure Code.' (Emphasis added). It follows from the judgment in the case of Latabai(supra), that, it is not open for the party to seek modification of clause in the consent terms on the ground that, the same was not intended or agreed by the parties. It is only in those cases, where the consent terms as a whole, on the ground that fraud, misrepresentation or of similar ground are challenged, then the Court has to decide the issue. Coming to the facts of the present case, the petitioner has not disputed that he has received consideration of Rs.1 Crores and 45 Lacs for the property bearing survey No. 51/2A, situated at Shirdi, Tq. Rahata, District Ahmednagar. It is evident that the deed of conveyance is executed between the parties. The contention of learned senior counsel for the petitioner that, clause 3 of the consent terms was under fraud, coercion and it was signed by the petitioner under coercion and signatures are obtained by fraud and therefore, the petitioner has challenged the consent terms as a whole, cannot be accepted. The contention appears to be that the property bearing survey No. 51/4 situated at Shirdi, Tq. Rahata, District Ahmednagar is released without any consideration. The said contention is devoid of any merits. 14. It is not necessary to burden this judgment by reproducing the findings recorded by the trial court, when this Court is in complete agreement with the said findings. Therefore, taking over all view of the matter, in my considered opinion, the view taken by the trial court is possible and reasonable view, which needs no interference in writ jurisdiction. Hence, writ petition is devoid of any merits and the same stands rejected. 15. Rule stands discharged. No order as to costs. 16. In view of disposal of writ petition, pending civil application No. 11430 of 2012 stands disposed of as infructuous.
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