1. This revision petition is directed against the order of the Civil Judge, Mangalore, South Kanara, passed in Miscellaneous Appeal No. 21 of 1965.
2. The respondent filed O. S. 256 of 1964 for cancellation of a registered deed of sale dated 20-3-43 against the present petitioner and others. The present petitioner, during the course of the suit, filed an application under Order XXIII, Rule 3 read with Section 151 of the Code of Civil Procedure praying that a decree be drawn up in terms of the compromise, according to which the suit was to be dismissed as having been settled out of court. The plaintiff-respondent contended that there was no agreement as set up by the present petitioner that he 'had not received the sum of Rs. 500/- as mentioned in the endorsement to the memo of compromise and that the document had been brought about fraudulently and bymisrepresentation. According to the respondent, his signatures were taken on a paper as also a printed form of vakalat representing that an adjournment of the suit was to be obtained and his signatures were required on them. The learned Munsiff recorded the evidence and came to the conclusion that the suit had been settled out of court and the same was accordingly required to be dismissed.
3. The plaintiff then preferred a Civil Miscellaneous Appeal No. 21 of 1965 in the court of the Principal Civil judge, Mangalore, South Kanara. The learned Civil Judge took a different view, allowed the appeal and set aside the decree passed by the learned Munsiff and directed him to take the suit on file and proceed with the suit in accordance with law. The defendant-petitioner has approached this court in revision.
4. Mr. Holla, the learned Advocate, appearing for the petitioner has contended that the learned Civil Judge had exceeded his jurisdiction in as much he had gone into the investigation of allegations relating to fraud and misrepresentation and that it was not within his competence to do so in view of the words contained in Order XXIII, Rule 3 of the Code of Civil Procedure. Order XXIII, Rule 3 provides for adjustment of suit by compromise. Rule 3 reads as follows:--
'Where it is proved to the satisfaction of the Court that a suit has been adjusted wholly or in part by any lawful agreement or compromise, or where the defendant satisfies the plaintiff in respect of the whole or any part of the subject-matter of the suit, the court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance therewith so far as it relates to the suit.'
The plain wording of this rule requires that there should be proof to the satisfaction of the court that the suit has been adjusted wholly or in part by ah agreement, and further such agreement should be lawful. I have heard at length arguments by the learned Advocates appearing for both the parties about the scope of this rule. Many of the decisions which were cited by Mr. Holla : AIR1928All494 , : AIR1952Cal73 , : AIR1950Mad728 , : AIR1959Ker130 and ) lay down that if the allegations of fraud or misrepresentation are incidental to an admitted agreement having been arrived at between the parties, it is not within the competence of the Court to enquire into such incidental matter but leave the parties to a separate suit to get an adjudication on the question whether the admitted agreement was voidable. As against these decisions, Mr. U. L. Narayana Rao has placed reliance on the decisions in : AIR1956Bom569 , AIR 1952 Nag 84 and : AIR1955All187 , in which a contrary view has been taken. The latter decisions lay down that while enquiring into the questions required to be investigated into under Rule 3, it is necessary for the court to be satisfied that the agreement set up is a valid agreement not vitiated by fraud, misrepresentation or coercion which might render the agreement voidable,
5. Though, it is not necessary for the decision of this case to decide which of the two conflicting views is acceptable I would however indicate my views on the question, since no decision of this court on the point has been brought to my notice by the Advocates. The object of the rule is to enable the court to give effect to a lawful agreement or compromise in respect of the whole or part of the claim in the suit, if the parties put forward such agreement or compromise before the suit is decided on merits by the court. The agreement or compromise recorded under this rule would result in the passing of a decree in accordance with the terms of compromise in so far as they relate to the suit. It should therefore follow that a decree passed in terms of the compromise or agreement must be 'conclusive of the rights of parties' and executable without further objection by any of the parties as being inherent in the decree itself. The words 'where it is proved to the satisfaction of the court' with which the rule opens impose, in my opinion! an obligation on the court to be satisfied that the suit has been genuinely adjusted in whole or in part. If one party to the suit sets up an agreement or compromise whose terms are lawful and the other party to such alleged agreement or compromise denies it or alleges that it has been brought about by fraud, undue influence, coercion or misrepresentation as vitiating the agreement or compromise and if, during the course of the enquiry as to the allegations made by the party disagreeing with the agreement or compromise the court is satisfied that the agreement or compromise is to vitiate, I do not think that the rule intends the recording of such compromise, because, it cannot be said in such a case that the suit has been adjusted wholly or in part to the satisfaction of the court. The agreement or compromise, by this rule is intended to put an end to the whole litigation by an amicable settlement to the party's own free will and consent; it is not intended either to sow the seeds of fresh litigation or to leave the contentions raised by the parties to a further suit; undoubtedly in the latter event the- object ,of the rule to put an end to the litigation by passing a decree in terms of agreement or compromise would stand frustrated, On a careful consideration ofthe decisions cited at the Bar by both the Advocates. I am of the opinion that the words 'proved to the satisfaction o the Court' are comprehensive enough and indeed seem to have been intended to empower the Court to go into the merits of the allegations set up by the party denying or disagreeing with the terms of compromise or agreement and decide them, so that the parties get full justice in the suit in which a decree in terms of the compromise is to be passed under the rule. Where the court finds during the course of the enquiry that the alleged agreement or compromise is vitiated by fraud, misrepresentation etc., it cannot be said legally that an agreement has been arrived at. The agreement contemplated under the rule envisages the two parties corning to certain terms voluntarily and of a free will so as to put an end to the litigation pending between them in the court. I am in respectful agreement with the observation found at page 1295 of Mulla's commentary on the Code of Civil Procedure, Volume II, Thirteenth Edition -- 'The words 'where it is proved to the satisfaction of the court that a suit has been adjusted wholly or in part' clearly show that the court has power under this rule, where an agreement^ or compromise is denied, to decide whether, as a fact, the alleged agreement or 'compromise was made 'and if it is satisfied that it was made, to record it.' If it decides that the agreement or compromise is vitiated, it can reject it and proceed to dispose of the suit on merits.
6. In spite of my view that it is competent to the Court to go into the question as to whether the alleged agreement is vitiated by fraud etc., I wanted to find out whether, in fact there had been an agreement or compromise in this case as alleged by the defendant, and therefore requested Mr. Holla to read to me the order of Civil Judge, the depositions of the plaintiff and the defendant. I have come to the conclusion after going through these depositions and the order, that it is not necessary for the disposal of this petition to go into the disputed question as to whether the court has competence under. Rule 3 to find out whether the agreement set up by one of the parties was- in fact vitiated by fraud, undue influence, misrepresentation etc. On facts, the learned appellate Judge has come to the conclusion that there was no agreement as alleged by the defendant. That is also my conclusion, as I shall presently point out.
7. The learned Appellate Judge hasreviewed the evidence carefully and considered also all the circumstances appearing in the case. He has stated at the end of paragraph 10 of his order-
'.....it will be abundantly clearthat Exhibit P-1 (i.e., the agreement inquestion) was brought about in mysterious circumstances and the present respondent and his worthy brother and his associates appear to have conspired together and brought about Exhibit P-1.'
Again, at the end of paragraph 11 he has noticed that the endorsement in Kannada about the payment of Rs. 500 to the plaintiff was below his signature and that circumstance also belied the genuineness of Exhibit P-1. After discussing the entire evidence, this is what the learned Judge has concluded at the end of paragraph 13-
'.,.............,..The evidence In the caseand the circumstances that led to the execution of Exhibits P-l and P-2 would point to the conclusion that they were brought about under suspicious circumstances and that R. W. 2 (plaintiff) was not aware of their contents.'
This conclusion of the learned Judge would show that there was no agreement as contemplated by Rule 3.
8. I find substantial confirmation of this view from the evidence of the parties. The present petitioner was examined as P. W. 1, In his examination-in-chief itself he has stated that the terms of the compromise were. .He deposed that it was decided that the plaintiff should be paid Rs. 500/- towards the expenses of the suit and the plaintiff had to withdraw the suit. If we examine Exhibit P-l in the light of this statement,' we find that in the main body of the compromise petition, there is no reference to these terms. On the other hand, Exhibit P-l states in English thus 'Memo filed on behalf of the plaintiff. As the above suit is settled out of Court, the same may be dismissed and each party to bear their costs.' The plaintiff has signed 'this document in Kannada and the words 'Mangalore and the figure 9.10.1963 are written in English, quite in line with the signature of the plaintiff. The word 'Plaintiff' is also written below the signature. Then, there is an endorsement down below in Kannada stating_ that the present petitioner paid to the plaintiff Rs. 500/- in person. This endorsement does not however bear- the signature of- the plaintiff. When the plaintiff was examined as R'. W. 2 he admitted his signature but denied his knowledge of the contents and the alleged agreement. According to him, his signatures were taken to some English writing stating that it was an adjournment petition and a vakalat and that they were required to be filed by an advocate for whom another vakalath was needed, and his signature was taken thereon. It was nowhere suggested in the cross-examination of the plaintiff that the contents of the documents were read over and translated' to him by any of the persons. Mr. Holla, however, submits that the evidence adduced on behalf of the defendant shows that the document wasInterpreted to the plaintiff. Taking the evidence as a whole, I am one with the learned appellate Judge in holding that there was no agreement as set up by the defendant and that the order of remand of the suit for disposal according to law requires to be affirmed.
9. For these reasons, this petition IsDismissed with costs.
10. Petition dismissed.