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TMI Blog2019 (6) TMI 312X X X X Extracts X X X X X X X X Extracts X X X X ..... Magistrate, Dwarka Courts, New Delhi, for dishonour of a cheque dated 1st December, 2009 for an amount of Rs. 75 lacs against the alleged liability of Rs. 3 crores; (b) that the plaintiff appeared before the Court on 18th March, 2010 and the NBW was cancelled and the plaintiff granted bail; (c) that from a perusal of the complaint filed by defendant No.2 Prashant Mamgain on behalf of the defendant No.1 Tushar Patni against the plaintiff, the plaintiff came to know that previously also a complaint of offence under Section 138 of the NI Act was filed before the same Court by defendant No.2 as authorised representative of defendant No.1; (d) that in the previous complaint it was claimed that the defendant No.1, on 10th May, 2006 had given a friendly loan of Rs. 2 crores in cash to the plaintiff for a period of six months and the plaintiff had issued a cheque dated 4th October, 2007 for a sum of Rs. 2 crores in discharge of the said debt; the said cheque was returned dishonoured leading to the filing of that complaint; (e) that the plaintiff further learnt that the said previous complaint was withdrawn on 15th October, 2009 by defendant No.2 on behalf of the defendant No.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (q) that it is quite evident that the signatures of the witnesses on the Compromise Deed dated 15th November, 2008 have been obtained subsequently; (r) that the daughter of the plaintiff has also confirmed that her signatures were taken on some papers by the defendant No.2 in a very clandestine manner, as the defendant No.2 "is harassing plaintiff's daughters and also blackmailing them"; (s) that the defendants are similarly extorting monies from one Mr. R.S. Chauhan using similar modus operandi; (t) that in the complaint case filed by the defendants against the said Mr. R.S. Chauhan, approximately 40 hearings in a year were held in the Court of Metropolitan Magistrate Sh. N.K. Laka; (u) that the plaintiff has also filed a complaint before the Bar Council of India under Section 35 of the Advocates Act, 1961 of professional misconduct against Mr. Alok Kumar Pandey, Mr. Vijay Nath and Mr. R.K. Thakur, Advocates, and it was confessed by Mr. Alok Kumar Pandey, Advocate that he obtained signatures on alleged agreement deed and Vakalatnama and asked Mr. Vijay Nath, Advocate to appear on behalf of the plaintiff; (v) that the defendant No.1 is not financially competent to g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... journed to today. 9. Before proceedings to record the contentions of the counsels, it is deemed appropriate to record the reasons for which it was felt on 30th November, 2018 that the suit for cancellation of a compromise forming part of a judicial proceeding does not lie. 10. Order XXIII Rule 3 of the Code of Civil Procedure, 1908 (CPC) provides for compromise of a suit and empowers the Court to record an agreement, compromise or satisfaction of the suit claim or part thereof and to pass a decree in accordance therewith and the Proviso thereto clarifies that where it is alleged by one party and denied by the other party that an adjustment or satisfaction has been arrived at, the Court shall decide the question. Order XXIII Rule 3A of the CPC bars a suit to set aside a decree on the ground that the compromise on which the decree is passed was not lawful. It was felt that (i) the proceedings in a complaint case under Section 138 of the NI Act, though not a suit, are quasi civil in nature and the principles as laid down in Order XXIII Rules 3 and 3A of the CPC would apply; (ii) if it were held that the question of validity of a compromise arrived at in one proceeding were per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed and if any of the party wants to challenge the decree or the compromise deed, has to do so before the same Court; the reason therefor is that the party praying to have the compromise deed set aside will have to satisfy the same Court before whom the compromise was arrived at and filed and which accepted the compromise; (viii) reliance is placed on Banwari Lal Vs. Chando Devi (1993) 1 SCC 581 and Rajwanti Vs. Kishan Chand Shehrawat 2009 (113) DRJ 166; (ix) that no withdrawal/compromise or decree under the provisions of Order XXIII of the CPC has taken place in the present case; (x) that a Criminal Court cannot pass a decree and only a Civil Court can pass a decree; reliance is placed on Section 2(2) of the CPC defining a "decree'; (xi) that a criminal complaint filed under the provisions of Section 138 of the NI Act is a cognizable punishable offence and tried as per the procedure prescribed under the Criminal Procedure Code, 1973 (CrPC); (xii) that settlements under NI Act matters before the Criminal Courts can be either by allowing withdrawal of complaint under Section 257 of the CrPC or by allowing compounding of offence under Section 147 of the NI Act; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e justice in such proceedings, Criminal Courts are known to have often utilized the principles of CPC in such cases; Supreme Court also has encouraged early settlement in such proceedings; (c) that proceedings under Section 138 of the NI Act have been considered as quasi civil by all the Courts, therefore, in principle, the procedure which applies to recording a settlement in civil cases could guide the procedure to be followed and be applied for recording a settlement between the parties to a complaint under Section 138 of the NI Act; guidance on this aspect is provided by the provisions of Order XXIII Rule of the CPC and the practice followed by the Civil Courts, upon a compromise arrived at between the parties to a suit; (d) that CrPC as well as NI Act have provided only for compounding of offences; no procedure regarding the manner in which a settlement agreement is required to be placed or considered by the Court has been provided; (e) that though the CPC would have no application to the proceedings which are guided by the CrPC but given the legislative vacuum there appears no reason as to why the principles which apply to consideration of a settlement under Order XXI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avoid making the payment and to violate the undertaking given to the Court. 14. The counsel for the defendants lastly relies on Dunia Lal Datta Vs. Nagendra Nath Datta AIR 1982 Cal 163 concerned with a suit for declaration that a decree in another suit was void, inoperative and not binding upon the plaintiff. It was held that Section 31 of the Specific Relief Act empowers the Court to cancel a written instrument and that an award and judgment of a Court is not a written instrument. 15. The counsel for the plaintiff has responded to the dicta of the Division Bench of this Court in Dayawati supra by contending that the same is in the context of mediated settlement and it is not so here. 16. Though the counsel for the plaintiff in her arguments has repeatedly gone into the merits of the challenge also but the question seized at the moment being only of maintainability of the suit and for which reason the written statement of the defendants also has not been noted hereinabove, I have steered clear from the arguments on merits which are to be considered only in the event of the suit being found to be maintainable in this Court and in the event of the suit being not found to be mainta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise deed filed. Statement of of parties recorded. In view of the statement, the complaint is dismissed as withdrawn as compromised. File be consigned to record room. (Naresh Kumar Laka) 1st LMM/Dwarka Courts Delhi/15.10.2009" and, (V) that the Compromise Deed placed on record was as under: "COMPROMISE DEED THIS DEED OF COMPROMISE IS MADE AT NEW DELHI ON THIS THE 15th day of November, 2008 between Mr. Tushar Patni, S/o Shri M.J. Patni, P.O. Box No.880, Abu Dhabi, UAE through his authorized Attorney Shri Prashant Mamgain, S/o Shri Prithvi Dhar Mamgain, C-2/26, Mangal Apartments, Vasundhara Enclave, Delhi - 110096 hereinafter called the First Party. AND Mrs. Sushila Badola, W/o Shri Vishwa Mohan Badola, R/o A212, Samachar Apartment, Mayur Vihar Phase-I, Delhi hereinafter called the Second Party. WHEREAS the Second Party took a friendly loan of Rs. 2,00,00,000 (Rupees Two Crores Only) from the First Party on 10.05.2006 on the promise of returning of the same within a period of 6 months. The Second party did not return the aforesaid amount within the stipulated period of 6 months. WHEREAS the Second Party in order to discharge her liability of the aforesaid amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed of Compromise have singed and executed the same at New Delhi in the presence of the following witness on the day, month and year mentioned hereinabove: WITNESSES: Sd. TUSHAR PATNI THROUGH HIS AUTHORIZED ATTORNEY Sd. (PRASHANT MAMGAIN) FIRST PARTY Sd. (SUSHILA BADOLA) SECOND PARTY" 18. The doubts expressed by me on 30th November, 2018 and as recorded in the order of that date, as to the very maintainability of this suit stand reinforced and the arguments aforesaid of the counsel for the plaintiff have failed to remove the said doubts. My reasons therefor are as under:- A. Though the complaint case filed by the defendants against the plaintiff was dismissed as withdrawn but recording the statement of the defendant no.2 as attorney of the defendant no.1 and of the counsel for the plaintiff. As per the said statement, the defendants did not simpliciter withdraw the complaint but withdrew the complaint (i) for the reason of the settlement arrived at with the plaintiff; (ii) placing on record the Compromise Deed entered into with the plaintiff; (iii) stating on oath that the said Compromise Deed was bearing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies and on which Complaint Court puts its imprimatur was inter alia of pursuing the complaint case and which could be pursued only after revival of the same. Thus, it is not as if the compromise divested the Complaint Court of the jurisdiction. E. Irrespective of whether the defendants were entitled to file fresh complaints of offence of dishonour of the cheques given under the Compromise Deed or not and irrespective of whether the defendants exercised the option of pursuing the complaint case in which the compromise was filed by seeking revival thereof, the challenge if any to the Compromise Deed filed in a Court even if exercising jurisdiction under the NI Act and CrPC in my opinion, applying the principle of Order XXIII Rule 3 of CPC, would lie in that Court only proceedings wherein culminated accepting the compromise and not before any other Court. Reference can be made to Pushpa Devi Bhagat Vs. Rajinder Singh (2006) 5 SCC 566, Horil Vs. Keshav (2012) 5 SCC 525, Y. Sleebachen Vs. State of Tamil Nadu (2015) 5 SCC 747, Morium Bibi Vs. Musst. Showkatara Begum 1994 SCC OnLine Cal 44, Gopal Lal Vs. Babu Lal AIR 2004 Raj 264 (DB), Bhai Sarabjit Singh Vs. Indu Sabharwal 2015 SCC OnL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in the complaint case. Thus, from what has been held by the Division Bench of this Court in Dayawati supra also, it follows that the challenge to the compromise permitted by law in Section 138 proceedings has to be before the same Court and not by way of a separate suit. K. I also concur with the view of the Calcutta High Court. A Compromise Deed aforesaid though a written instrument within the meaning of Section 31 of the Specific Relief Act, once filed in the Court in which disputes to be settled thereunder are pending and the Court passes orders in terms thereof ceases to have the character of a written instrument within the meaning of Section 31 of the Specific Relief Act and merges with the judicial order. Reference in this regard can also be made to Salkia Businessmen's Association Vs. Howrah Municipal Corporation (2001) 6 SCC 688, Pulavarthi Venkata Subba Rao Vs. Valluri Jagannadha Rao AIR 1967 SC 591, Anand Deep Singh Vs. Ranjit Kaur (2000) SCC OnLine Del 393, Pratabmull Rameswar Vs. K.C. Sethia (1944) Ltd. AIR 1960 Cal 702 (DB) and Banwari Lal supra. It was well-nigh possible for the parties in their respective statements made before the Complaint Court to have detaile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... int and/or that the plaintiff is not bound by the said compromise and for which in my humble opinion the Civil Courts have no jurisdiction. While the High Court is permitted to, under Section 482 of the Cr.P.C., pass any orders to prevent abuse of the process of the Court or to otherwise secure the ends of justice, but the inherent powers can be exercised only when no other remedy is available to the litigant. Reference in this regard may be made to State of Haryana Vs. Bhajan Lal 1992 SCC (Cri) 426, Madhu Limaye Vs. State of Maharashtra (1997) 4 SCC 551, S.A. Nanjundeswara Vs. Varlak Agrotech (P) Ltd. (2002) 10 SCC 249, Monica Kumar Vs. State of U.P. (2008) 8 SCC 781 and Narinder Singh Vs. State of Punjab (2014) 6 SCC 466. O. Placing of a compromise before a Complaint Court cannot be an act of empty formality especially when the Court has acted upon the same and permitted the complaint to be withdrawn and acquitted the plaintiff. P. The judicial as well as the legislative policy in relation to complaint cases is also of encouraging settlements. Reference in this regard may be made to Section 147 of the NI Act and to the dicta of the Supreme Court in Damodhar S. Prabhu Vs. Saye ..... X X X X Extracts X X X X X X X X Extracts X X X X
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