HEMANTHA KUMARversusR. MAHADEVAIAH & ORS.

                        [2022] 12 S.C.R. 117                              117


                       HEMANTHA KUMAR                                     A
                                  v.
                   R. MAHADEVAIAH & ORS.
                   (Civil Appeal No. 4108 of 2022)
                            JULY 11, 2022                                 B
          [M. R. SHAH AND B. V. NAGARATHNA, JJ.]
       Code of Civil Procedure,1908 – Or.XXIII, r.3 – Consent decree
– Grant of – The original plaintiff instituted suit for specific
performance of the agreement to sell – Before the Trial Court plaintiff
                                                                          C
and defendants submitted an application under Or.XXXIII, r.3 and
requested to pass consent decree as parties have settled the dispute
– Trial Court referred the matter to Lok Adalat – Lok Adalat passed
the consent decree – Defendants filed writ petition before the High
Court challenging the consent decree on ground of fraud – High
Court set aside the consent decree, observing that counsel for the        D
plaintiff had mislead the trial Court in obtaining decree while
referring the matter to Lok adalat r/w the compromise – Plaintiff
preferred the appeal before the Supreme Court – Held: Merely
because the trial court have referred the matter to Lok Adalat that
alone cannot be a ground to doubt the genuineness of the consent
                                                                          E
decree – No fraud committed – High Court has committed grave
error in setting aside the consent decree passed in the Lok Adalat –
Judgment and order of High Court quashed and set aside – Consent
decree passed by the Lok Adalat restored.
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4108
                                                                          F
of 2022.
      From the Judgment and Order dated 30.11.2020 of the High Court
of Karnataka at Bengaluru in Writ Petition No. 35073 of 2015 (GM-
RES).
      Anand Sanjay M. Nuli, Ms. Agam Sharma, Nanda Kumar K. B.,           G
Shivashankar H. Manur, Ms. Shweta S. Manur for M/s Nuli & Nuli,
Advs. for the Appellant.
     S. N. Bhat, Sr. Adv., D. P. Chaturvedi, Tarun Kumar Thakur,
Ms. Parvati Bhat, Ramesh Kumar Mishra, Advs. for the Respondents.
      .                                                                   H
                                 117
118             SUPREME COURT REPORTS                           [2022] 12 S.C.R.


A            The Judgment of the Court was delivered by
             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
B     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:-

C             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
      suit came up for hearing before the learned Trial Court on 18.08.2007.
D     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
E     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.
F
             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
G     (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.
H
      HEMANTHA KUMAR v. R. MAHADEVAIAH & ORS.                                    119
                  [M. R. SHAH, J.]

       2.3 That thereafter the original plaintiff filed the Execution Petition   A
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.
                                                                                 B
       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      C
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              D
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.
       3. Learned counsel appearing on behalf of the appellant – original        E
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          F
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            G
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.

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120            SUPREME COURT REPORTS                          [2022] 12 S.C.R.


A            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
B
      is submitted that therefore, there was no reason for the High Court to
      doubt 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
C     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
D
      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
E     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
F     defendant Nos. 1 and 2. It is vehemently submitted by Shri Bhat, learned
      Senior Advocate, appearing on behalf of the defendant Nos. 1 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
G     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
H     Trial Court and referring of the matter to the Lok Adalat itself creates
      HEMANTHA KUMAR v. R. MAHADEVAIAH & ORS.                                    121
                  [M. R. SHAH, J.]

serious doubt. It is submitted that therefore when the defendant Nos. 1          A
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             B
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           C
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                  D
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          E
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           F
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 aforesaid                G
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              H
122             SUPREME COURT REPORTS                          [2022] 12 S.C.R.


A     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
B     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 Lok-Adalath and
            ordered to draw decree on 18.8.2007 while referring to the Lok-
            Adalath on 30.7.2007. However, compromise among the parties
C           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 Lok-Adalath
            r/w the compromise and drawing up of decree…..”
             8. Therefore, the High Court has observed that the counsel for
D     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 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
E     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.
F           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
G     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
H     Order XXIII Rule 3 CPC.
      HEMANTHA KUMAR v. R. MAHADEVAIAH & ORS.                                123
                  [M. R. SHAH, J.]

       10. In view of the above, the High Court has committed a grave/       A
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         B
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.          C

Ankit Gyan                                                 Appeal allowed.
(Assisted by : Aarsh Choudhary, LCRA)



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