HEMANTHA KUMAR versus R. MAHADEVAIAH & ORS. on 11 July 2022

1. Feeling aggrieved and dissatisfied with the impugned judgmentand order passed by the High Court of Karnataka at Bengaluru in WritPetition No. 35073 of 2015 by which the High Court has set aside theBconsent decree passed in the Lok Adalat and consequently has restoredthe original suit, original plaintiff has preferred the present appeal.

2. The facts leading to the present appeal in a nutshell are asunder:- C2.1 That the appellant herein – original plaintiff instituted OriginalSuit No. 94 of 2006 in the Court of learned Civil Judge (Sr. Dn.) atKunigal for specific performance of the agreement to sell/contract. Thesuit originally was filed against three defendants, however, one of thedefendants – defendant No. 3 came to be deleted by the plaintiff. Thesuit came up for hearing before the learned Trial Court on 18.08.2007.DThe plaintiff and the original defendant Nos. 1 and 2 submitted anapplication under Order XXIII Rule 3 CPC, in which it was stated thatthe parties have settled the dispute and it was requested to pass a consentdecree. The defendant Nos. 1 and 2 admitted execution of the agreementto sell dated 26.04.2005 in favour of the plaintiff and also admitted receiptEof Rs. 30,000/- towards the part sale consideration. In the applicationunder Order XXIII Rule 3 CPC, it was specifically stated that thedefendant Nos. 1 and 2 have received the remaining sale considerationamount of Rs. 70,000/- from the plaintiff. Therefore, it was requested topass the decree as prayed for in the suit as well as in terms of thecompromise petition.F

2.2 The said consent compromise/compromise deed/compromisepetition 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 theLok Adalat, which was presided over by the very learned Civil JudgeG(Sr. Dn.), Kunigal, the Advocates for the plaintiff as well as the originaldefendant Nos. 1 and 2 remained present and prayed to pass a consentdecree as per the application under Order XXIII Rule 3 CPC.Consequently, by judgment and decree dated 27.08.2007, the learnedTrial Court passed the consent decree.

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2.3 That thereafter the original plaintiff filed the Execution PetitionNo. 88 of 2013 to execute the consent decree and for seeking executionof the sale deed in his favour. That thereafter, the defendant Nos. 1 and2 filed the writ petition before the High Court being Writ Petition No.35073 of 2015 challenging the consent decree passed by the Court ofLok Adalat on the ground that the consent decree was obtained by fraud.

2.4 By the impugned judgment and order, the learned Single ofthe High Court has allowed the said writ petition and set aside the consentdecree passed by the learned Trial Court passed in the Lok Adalat. Thisis mainly on the ground that looking to the compromise amongst theparties and the dates and events, prima facie it is evident that counselfor the plaintiff must have mislead the Trial Court in obtaining the decreeon 18.8.2007 while referring the matter to Lok-Adalat r/w thecompromise and drawing up of decree. By observing so, the High Courthas set aside the consent decree passed by the learned Trial Court passedin the Lok Adalat and directed to restore the original suit to the file andthe learned Trial Court has directed to re-commence the proceedingsfrom the date of referring the matter to the Lok Adalat.

2.5 Feeling aggrieved and dissatisfied with the impugned judgmentand order passed by the High Court, the original plaintiff has preferredthe present appeal.

3. Learned counsel appearing on behalf of the appellant – originalplaintiff has vehemently submitted that in fact the plaintiff and thedefendant Nos. 1 and 2 jointly submitted the application under OrderXXIII Rule 3 CPC before the learned Trial Court and requested thelearned Trial Court to pass a consent decree. It is submitted that, however,instead of passing the consent decree, the learned Trial Court referredthe matter to the Lok Adalat. It is contended that merely because thematter was referred to the Lok Adalat cannot be a ground to doubt thegenuineness of the consent decree/consent compromise and also thefiling of the application under Order XXIII Rule 3 CPC.

3.1 It is further submitted by the learned counsel appearing onbehalf of the appellant – original plaintiff that in fact the defendant Nos.1 and 2 received the balance sale consideration of Rs. 70,000/- asmentioned in the consent application/application under Order XXIII Rule3 CPC.

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A3.2 It is further submitted that before the learned Trial Court aswell as the Lok Adalat, which was presided over by the very learnedPresiding Judge, learned Advocates appearing on behalf of the respectiveparties appeared and prayed to pass a consent decree on the basis ofthe application filed under Order XXIII Rule 3 CPC and only thereafterthe learned Trial Court in the Lok Adalat passed the consent decree. ItBis submitted that therefore, there was no reason for the High Court todoubt the genuineness. It is submitted that as such while passing theimpugned judgment and order and quashing and setting aside the consentdecree passed in the Lok Adalat, the High Court has observed that lookingto the compromise amongst the parties and the dates and events, primaCfacie it is evident that counsel for the plaintiff must have mislead theTrial Court in obtaining the decree on 18.8.2007 by referring the matterto the Lok-Adalat r/w the compromise and drawing up of decree. It issubmitted that as such, such observations are not warranted at all. Thateven otherwise the observations were not prima facie in nature. The High Court has observed that the counsel for the plaintiff mislead theDTrial Court, however, what about the Advocates for the defendant Nos.1 and 2, who signed the application under Order XXIII Rule 3 CPC andappeared before the learned Trial Court and even appeared before theLok Adalat. It is submitted that there are no allegations and/orobservations against the Advocates for the defendant Nos. 1 and 2. It isEsubmitted that in that view of the matter, the High Court has erred insetting aside the consent decree passed by the learned Trial Court passedin the Lok Adalat.4. Present appeal is vehemently opposed by Shri S.N. Bhat,learned Senior Advocate appearing on behalf of the respondents – originalFdefendant Nos. 1 and 2. It is vehemently submitted by Shri Bhat, learnedSenior Advocate, appearing on behalf of the defendant Nos. 1 and 2 thatas such the chronology of dates and events creates serious doubt aboutthe genuineness of the consent compromise/consent decree. It iscontended that first of all, the plaintiff deleted the defendant No. 3 and the suit came to be dismissed qua defendant No. 3. That immediatelyGthereafter Order XXIII Rule 3 application was submitted. That as suchonce there was an application under Order XXIII Rule 3 CPC and theparties agreed and requested to pass the consent decree, there was noreason for the learned Trial Court to refer the matter to Lok Adalat. It issubmitted that therefore, the decree not being passed by the learnedHTrial Court and referring of the matter to the Lok Adalat itself creates serious doubt. It is submitted that therefore when the defendant Nos. 1and 2 alleged fraud, the defendant Nos. 1 and 2 should have been giventhe opportunity to prove the alleged fraud.

4.1 Making above submissions, it is submitted that the High Courthas not committed any error in quashing and setting aside the consentdecree obtained by the plaintiff in the Lok Adalat. Therefore, it isrequested to dismiss the present appeal.

5. We have heard the learned counsel appearing for the respectiveparties at length and perused the impugned judgment and order passedby the High Court. We have also gone through the relevant material onrecord. We have minutely considered the dates and events, which led tothe passing of the consent decree in the Lok Adalat presided over by thelearned Trial Court.

6. At the outset, it is required to be noted that as such the plaintiffand the defendant Nos. 1 and 2 and their Advocates filed the applicationbefore the learned Trial Court under Order XXIII Rule 3 CPC andrequested to pass a consent decree submitting that the parties havesettled the disputes. Filing of the application under Order XXIII Rule 3CPC is not disputed by the defendant Nos. 1 and 2. That thereafterinstead of passing the consent decree on the basis of the applicationfiled under Order XXIII Rule 3 CPC as requested and prayed, forwhatever reason, the learned Trial Court referred the matter to the LokAdalat. Before the Lok Adalat, the learned Advocates appearing onbehalf of the plaintiff and defendant Nos. 1 and 2 appeared and theyrequested to pass the consent decree and accordingly in the Lok Adalat,which was presided over by the very learned Judge, a consent decreecame to be passed. Merely because the learned Trial Court, before whomthe 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 thedecree/consent decree in the Court, the matter is referred to the LokAdalat and directed to be placed before the Lok Adalat and therefore, aconsent decree was passed as prayed by the parties. The aforesaidprocedure adopted in the instant case cannot be a ground to doubt thegenuineness of the consent decree. From the aforesaid, it cannot be saidthat there was a fraud committed and/or the counsel on behalf of theplaintiff to mislead the Court to refer the matter to the Lok Adalat. Thematter was referred to the Lok Adalat by the Court and even the Lok AB

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AAdalat was presided over by the very same learned Trial Court Judge.Therefore, as such, the High Court has committed a grave/serious errorin doubting the consent decree.

7. Even otherwise, it is required to be noted that while settingaside the consent decree passed in the Lok Adalat, the High Court hasBobserved in paragraph 6 as under:- “6. Writ petition could not have been entertained in view of thefact that O.S. No. 94/2006 was referred to Lok-Adalath andordered to draw decree on 18.8.2007 while referring to the Lok-Adalath on 30.7.2007. However, compromise among the partiesCand dates and events prima-facie it is evident that counsel for theplaintiff must have mislead the trial Court in obtaining decree on18.8.2007 with reference to referring the matter to Lok-Adalathr/w the compromise and drawing up of decree…..”

8. Therefore, the High Court has observed that the counsel forDthe plaintiff must have mislead the Trial Court in obtaining the decree on18.8.2007 with reference to referring the matter to Lok-Adalat r/w thecompromise and drawing up of decree. On what basis and/or the material,the High Court has observed so and that too ‘prima facie’, cannot beappreciated by us. Though, the High Court has commented about thecounsel for the plaintiff, however, the High Court has not at all appreciatedEthe fact that the application under Order XXIII Rule 3/consent applicationwas presented and signed by the Advocates for the defendant Nos. 1and 2 also the parties, who had also appeared before the learned TrialCourt as well as before the Lok Adalat. There are no allegations at allagainst the counsel appearing on behalf of the defendant Nos. 1 and 2.F

9. It is also to be noted that neither are there any observations bythe High Court that on submitting the application under Order XXIIIRule 3 CPC before the learned Trial Court and requesting for passingthe consent decree, defendant Nos. 1 and 2 had objected to submittingthe application under Order XXIII Rule 3/consent application in which itGwas requested to pass a consent decree. It is to be noted that in theapplication under Order XXIII Rule 3 CPC, it was further stated thatdefendant Nos. 1 and 2 have been paid the balance sum ofRs. 70,000/-. It is not the case on behalf of the defendant Nos. 1 and 2that they have not received the balance sale consideration ofRs. 70,000/- as mentioned in the consent application / application underHOrder XXIII Rule 3 CPC.

HEMANTHA KUMAR v. R. MAHADEVAIAH & ORS.[M. R. SHAH, J.]

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 passedin the Lok Adalat, which was presided over by the very learned TrialCourt Judge. The impugned judgment and order passed by the HighCourt is unsustainable, both in law as well as on facts.

Under the circumstances, the impugned judgment and order dated30.11.2020 passed by the High Court in Writ Petition No. 35073 of 2015is hereby quashed and set aside. The consent decree passed by thelearned Trial Court passed in the Lok Adalat is hereby restored.

Present Appeal is Allowed accordingly. However, in the factsand circumstances of the case, there shall be no order as to costs.

Ankit Gyan

Appeal allowed.

(Assisted by : Aarsh Choudhary, LCRA)

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