ISSUE: The case at hand, Pushpa Devi Bhagat v.

Rajinder Singh and Ors, presented before the

RULE: In light of the issues raised by the case, it can be discerned that the sections relevant and
central to the judgement are: (1) Section 96 of the Code of Civil Procedure and (2) Order 23
Rule 3 of the Code of Civil Procedure.

1) Section 96 of the Code of Civil Procedure provides the litigant with the right to appeal
against original decrees as Clause (1) under Section 96 of the CPC mandates that “an
appeal shall lie from every decree passed by any court exercising original jurisdiction
to the Court authorised to hear appeals from the decisions of such Court”. Clause (2)
of Section 96 of the CPC proceeds to specify that “an appeal may lie from an original
decree passed ex parte”. Lastly however clause (3) of Section 96 provides an exception
whereby it is stated that “no appeal shall lie from a decree passed by the Court with the
consent of parties”.
2) Order 23 Rule 3 of the Code of Civil Procedure deals with the compromise of suits. The
rule provides that “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 in writing and
signed by the parties, 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 parties to the suit, whether or not the
subject-matter of the agreement, compromise or satisfaction is the same as the subject-
matter of the suit.”

ANALYSIS: Before delving into the specific analyses of the two issues raised, it is imperative to
provide a brief factual context of the case. At its most essential level, the concerned suit was a
simple suit for recovery of possession by a landlord against a tenant that happened to be filed in
the year of 1993. The original plaintiffs (respondents in the present case) had led and closed their
evidence by 1998 and yet on the other hand, the original defendants (including the appellant in
the present case) had repeatedly failed to lead evidence for an entirety of three years. No
evidence being tendered for three years led the concerned Court (the Delhi High Court) to
contend that no further adjournment for tendering evidence shall be granted and in pursuance to
the same, at the final hearing, a compromise was recorded and decree was passed in alignment of
the same. The compromise included a statement on oath,on the part of the counsel for the
original defendants (appellant herein), to vacate the premises of the suit-property by 22.01.2002
and also agreed to pay Rs. 4,800 per month up to 22.01.2002. A reciprocal statement was made
by the counsel on behalf of the plaintiffs (respondents herein) agreeing to grant time till
21.01.2002 and also acknowledging their entitlement to the monthly payment of Rs. 4800. These
statements were recorded by the Court and signed by both counsels and on the basis of the same,
an executable decree was passed. Here, it is important to note that the second original defendant
(the appellant in the present case) had filed an application before the Court passing said decree to
set aside the consent decree on the ground that the compromise was not valid. However, the
appellant then chose to not pursue said application while moving an appeal against the consent
decree before the higher court. Now, it is this very act that gives rise to the substantial and
reasonable question of maintainability of such appeal. The hon’ble Supreme Court found the
discussion of the maintainability of the appeal to be so significant and central to the case that in
spite of the fact that the present respondents had failed to raise the issue in the previous courts,
i.e., the first appellate court or the Delhi High Court, the issue was allowed to be newly raised in
the present case. The Court here took note of Section 96(3) which places a specific bar on
appeals against a consent decree. There happened to be an earlier provision, that is clause (m) of
Rule 1, order 43 of CPC which would still provide a leeway that could be availed to move an
appeal against a recording or refusal to record an agreement or compromise under Order 23 Rule
3 of the CPC but this leeway had been omitted in 1976 and simultaneously a proviso had also
been attached to Order 3 Rule 23 of the CPC, that is, Rule 3A: “provided that where it is alleged
by one party and denied by the other that an adjustment or satisfaction has been arrived at, the
court shall decide the question”. In light of these aforementioned statutory omissions and
additions, the procedure to be taken in order to challenge a consent decree becomes amply clear.
It is established that an appeal against a consent decree or an appeal against a court recording or
refusing to record a compromise cannot be moved, owing to the specific bar under Section 96(3)
of the CPC as well as the omission of Clause (m), Rule 1, Order 43. Moreover, the added proviso
rule 3A, Order 23 of the CPC establishes that every consent decree operates as an estoppel and is
deemed to be valid and binding except for when the court which passed said decree sets it aside.
Therefore, the only path that can be availed by a litigant to challenge a consent decree is to
approach the very court that recorded the compromise and executed the consent decree on the
grounds that there was no actual compromise. The onus is then on the court to determine whether
there indeed was a valid compromise. That is the single point of determination as every consent
decree is a judicial sanction on the agreement of the parties and hence the validity of the
agreement itself speaks to the validity of said decree. In the present case however, it is seen that
in spite of knowing the appropriate procedure and filing in application in accordance to the same,
the appellant abandoned it and moved an appeal against the consent decree, an act that is
specifically statutorily barred. Therefore, mainly in recognition of Section 96(3) of the CPC, the
appeal was held to be not maintainable.
Now, the second issue concerns itself with the validity of the concerned compromise tested at the
touchstone of Order 23 Rule 3 of the Code of Civil Procedure. This rule has two parts, of which,
the first part warrants agreements or compromises reduced to writing and signed by parties and
then such agreement is placed before the court and upon the court’s satisfaction that the written
signed agreement suitably settles the issue, the court passes a consent decree. This decree is
executable and can be enforced in the case of contravention of the written compromise. But, the
second part of the rule mentions those compromises that do not warrant a written agreement to
that effect. A written agreement is deemed to be unnecessary only when the plaintiff has satisfied
the defendant in relation to his claim, either by satisfying the defendant that the claim cannot be
met or by performance of the plaintiff’s obligation. The contention of the appellant in the present
case was that the concerned compromise was not valid as the same did not involve a written
agreement signed by the parties. The Delhi High Court, at the face of this contention, upheld the
validity of the compromise but reasoned it on the ground that the compromise fell under the
second part of the aforementioned rule. Upon careful scrutiny, the hon’ble court in the present
case found this ground to be erroneous but did end up upholding the validity of the compromise.
It was contended on the part of the appellant that the compromise was not a written, signed
agreement, which is a mandatory prerequisite for any agreement on the basis of which a consent
decree can be passed under Order 23 Rule 3. It was also contended that the said compromise
cannot attract the applicability of the second part of the rule as the second part is applicable only
to issues already satisfied through performance or otherwise. This compromise however includes
future promises which warrants an executable decree that can be enforced, in the case of breach
of said promise. To this, the court examined the recording of the compromise to ascertain
whether the necessary prerequisites that give effect to its validity had been fulfilled. Order 1 Rule
3 of the CPC provides that any appearance, application or act before a Court can be undertaken
by a legal representative, agent or pleader on behalf of the litigant. Rule 4 provides that such a
pleader must be authorised to act on the litigant’s behalf and the authorisation should be in the
form of a written vakalatnama. The court takes note of these rules and also mentions that it has
been a common practice for pleaders to act on the behalf of the actual parties. Here, the court
took recourse of the judgement in Byram Pestonji Gariwala v. Union Bank of India1 where it was
held that the phrase ‘signed by parties’ would also include signing by pleader. The case of
Jineshwardas v. Jagrani, also reiterated the stance that words “by parties” refer not only to
parties in person but also their attorney holders and authorised pleaders. 2If the wording is
interpreted narrowly to include only actual parties, then that would lead to unnecessary delay in
the disposal of suits and such delay is in direct contravention with even the specific essence of
the statute in question that is Rule 3, order 23 of CPC, the very object of which was to avoid
multiplicity of proceedings. Moreover, from the records of District Court in relation to the
original suit, a vakalatnama had been submitted before the hon'ble court that did authorise the
counsel for the appellant to act entirely on her behalf. Therefore, since the compromise was
signed by both the opposing counsels, it can be deemed to be duly signed by the parties
themselves. The court then also proceeded to scrutinise the phrase ‘in writing’ and its due
fulfilment in the present case. It must be remembered here that the respective statements of
plaintiffs' counsel and defendants' counsel were recorded on oath by the trial court in regard to
the terms of the compromise and those statements after being read over and accepted to be
correct, were signed by the said counsel. In relation to this, the court took recourse of Section 3
of the Evidence Act which states that a document is “any matter expressed or described upon any
substance by means of letters, figures or marks or by more than one of those means intended to
1 1992 (1) SCC 31
2 2003 (11) SCC 372
be used or which may be used for the purpose of recording the matter”. Keeping in mind this
comprehensive definition, there remains no doubt that the statements recorded on oath by the
court would then amount to being a written compromise. Therefore, it was deduced that all the
prerequisites were duly fulfilled to attract the applicability of the first of Rule 3 Order 23 of the
CPC and the compromise was a valid and binding compromise.

CONCLUSION: The challenge, on the part of the appellant, to the validity of the appellant was
therefore perceived by the hon'ble Supreme Court to be ‘frivolous and vexatious’ with a likely
intent to ‘protract the litigation indefinitely’. The appeal was therefore dismissed with costs as it
was devoid of merit.The costs were made payable by the appellant and were quantified at Rs.
25,000. The validity of the compromise was upheld, but on the basis of a reasoning distinctly
different from that of the Delhi High Court. The Court stated that the landlords (respondents in
the present case) would be entitled to seek mesne profits for the period from 22.1.2002 to date of
delivery of possession in accordance with law.