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TMI Blog2022 (6) TMI 373X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 to 5 are children of M. Krishnappa and M. Mallamma, Defendant No. 1. Plaintiff Nos. 2 and 3 are the sons of Plaintiff No. 1, namely, K. Devraj. The Plaintiffs filed a suit for partition and separate possession, being O.S. 876 of 2004 on the file of the Court of the Civil Judge, Junior Division, Rural District Bangalore stating that the suit Schedule properties were acquired by M. Krishnappa and were in joint possession and enjoyment of the Plaintiffs and Defendants, until the demise of M. Krishnappa. That following the death of M. Krishnappa, Defendant No. 1 was in possession of the suit Schedule properties and was acting in a manner detrimental to the interests of the Plaintiffs and had attempted to alienate the properties without effecting a partition so as to crystallise the rights of each of the parties to the suit. That requests of the Plaintiffs to effect a partition of the property, were met with threats by the Defendants to alienate the same. With the aforesaid averments the Plaintiffs had sought partition and separate possession of their shares in the suit Schedule properties. 4. During the pendency of the suit, on 30th June, 2012, a compromise petition was filed joint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugh their successors-in-interest or heirs, as regards their right, title and interest over the suit Schedule properties. vi. That the compromise was entered into by Plaintiff No. 1, on behalf of, and for the benefit of his two minor children, in order to protect their shares. 5. On 26th June, 2012, Plaintiff No. 4 encashed two cheques received by her as a part of the compromise entered into between the Plaintiffs and the Defendants, as detailed above. 6. In view of the inter-se compromise between the parties, the matter was referred by the Trial Court to the Lok Adalat. After hearing the parties, the Lok Adalat passed an order dated 07th July, 2012, decreeing the suit for partition and separate possession, in terms of the memo of compromise presented before it. The Lok Adalat recorded the following findings: i. That all the parties to the dispute had agreed to amicably settle the dispute as regards the partition of the suit Schedule property, in terms of the memo of compromise; ii. That the terms of compromise had been read over and explained to the parties in a language known and understood by them, in the presence of their Advocates and the parties had admitted the same t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ural District, Bangalore. Plaintiff Nos. 4-6 filed their objections to the compromise stating that their signatures on the compromise petition were obtained by fraud on the part of the Defendants. It was stated that during the pendency of O.S. No. 876 of 2004, one property included in the Schedule of properties to be partitioned, was sold in favour of M/s. Trishul Buildtech and Infrastructure Pvt. Ltd., by way of a registered sale deed dated 23rd June, 2012 for a consideration of Rs. 2,70,00,000/- (rupees two crores and seventy lakhs. That the amount of Rs. 30,00,000/- (rupees thirty lakhs), paid to Plaintiff Nos. 4-6, was their share of consideration for the said sale. That on the date of sale of the said property, several papers were signed by Plaintiff Nos. 4-6, at the behest of the Defendants, under the guise that the same were required to be submitted to the tax authorities. That Plaintiff No. 1 and the Defendants had conspired together and engaged the services of advocates to represent Plaintiff Nos. 4-6, without their knowledge. It was further alleged that the Defendants had caused Plaintiff Nos. 4-6 to believe that they were appearing before the tax authorities, in relation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... romise petition were true and correct, when the same had been read over and explained to them in Kannada language. That the Lok Adalat in its order dated 27th April, 2013 had upheld the validity of the compromise between the parties, after considering, in detail the objections raised by Plaintiff Nos. 4-6 and rejecting the same. It was urged that the Lok Adalat's order dated 27th April, 2013 had been passed after detailed examination of the contentions of the parties and the Lok Adalat had rightly rejected the objections raised by Plaintiff Nos. 4-6. However, the learned Single Judge of the High Court, in the absence of any reasoning, and in a casual and cryptic manner, had reversed the order of the Lok Adalat wherein the compromise of the parties was recorded. 17. It was next contended that every award of a Lok Adalat is deemed to be a decree of a Civil Court as provided Under Section 21 of the Legal Services Authorities Act, 1987 and cannot therefore be set aside by a cryptic order of the High Court sans reasons. Learned Counsel for the Appellants relied on Smt. Sawarni v. Smt. Inder Kaur and Ors. [1996 (6) SCC 223] to contend that when a Civil Court had come to a conclusion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Lok Adalat, after appreciating that the consent of Plaintiff Nos. 4-6 to the terms of compromise had been obtained by practicing fraud. 22. It was submitted that the High Court passed the impugned judgment after taking note of the fact that Plaintiff No. 4 had not signed the order sheet dated 07th July, 2012, wherein the Lok Adalat had recorded the compromise of the parties, although she had signed the compromise petition presented before the Lok Adalat. 23. It was next contended by learned Counsel for the Respondents that the amount of Rs. 30,00,000/- (rupees thirty lakhs), paid to Plaintiff Nos. 4-6, was their share of consideration for the sale of one property which was included in the Schedule of the properties to be divided between the parties. That such amount was not received in relation to the compromise between the parties and therefore, could not form the basis for rejecting their objections to the order recording comprise. 24. Ms. Manju Jetly further submitted that the fact that Plaintiff No. 4 had refused to sign the order sheet dated 07th July, 2012, having signed the compromise petition, would establish that she realised at that juncture that the Defendant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Defendants No. 6 to 9 and it is submitted by the learned Counsel for the Petitioners that by playing fraud compromise petition was filed. Petitioner No. 1 submits that she has not at all signed the compromise petition entered into between the parties. 3. Under the facts and circumstances of the case, I deem it proper to recall the order of the compromise. Order dated 7.7.2012 passed by the Lok Adalat is set aside. The matter is referred to the learned Civil Judge (Jr.Dn.) Bengaluru and is hereby directed to dispose of the matter in accordance with law, as if no compromise is entered into between the parties. Accordingly, these petitions are disposed of." 27. At the outset, we observe that we do not find any reason forthcoming from the judgment of the High court while setting aside the order of the Lok Adalat dated 07th July, 2012 whereby the terms of the compromise were recorded. To recall a compromise that has been recorded would call for strong reasons. This is because a compromise would result ultimately into a decree of a Court which can be enforced just as a decree passed on an adjudication of a case. This is also true in the case of a compromise recorded before a Lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be useful to refer to a judgment of this Court in Kranti Associates Private Limited and Anr. v. Masood Ahmed Khan and Ors. (2010) 9 SCC 496, wherein after referring to a number of judgments, this Court summarised at paragraph 47 of the judgment the law on the point. The relevant principles for the purpose of this case are extracted as under: (a) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well. (b) Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power. (c) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations. (d) Reasons have virtually become as indispensable a component of a decision-making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies. (e) Reasons facilitate the process of judicial review by superior courts. (f) The ongoing judicial trend in all countries committed to Rule of law and constitutional governance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g aspects would emerge: (a) The Lok Adalat, in its award dated 07th July, 2012 recorded that the parties had admitted that the contents of the compromise petition were true and correct, after the terms thereof had been read over and explained to them in Kannada language. Further, it was also noted that the compromise was entered into by Plaintiff No. 1, on behalf of, and for the benefit of his two minor children, in order to protect their shares. The same was allowed by the Lok Adalat on recognising the terms of the compromise, would protect the interests Plaintiff No. 1's minor children. There is no objection raised on behalf of Plaintiff No. 1 in the instant case. (b) The Lok Adalat, in its order dated 27th April, 2013, rejected the allegations of fraud raised by Plaintiff Nos. 4-6, against the Defendants and recorded that Plaintiff Nos. 4-6 had offered no explanation as to why no objection was raised by any of them on 07th July, 2012 before the Lok Adalat. It was further observed that Plaintiff Nos. 4-6, could not, after having accepted huge sums of money in terms of the compromise, rescind from the terms thereof. (c) It is not the case of Plaintiff Nos. 4-6 that they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 4-6 to the decree of the Lok Adalat had been rejected. 33. This Court in Ruby Sales and Services Pvt. Ltd. v. State of Maharashtra [(1994) 1 SCC 531] observed that a consent decree is a creature of an agreement and is liable to be set aside on any of the grounds which will invalidate an agreement. Therefore, it would follow that the level of circumspection, which a Court of law ought to exercise while setting aside a consent decree or a decree based on a memo of compromise, would be atleast of the same degree, which is to be observed while declaring an agreement as invalid. 34. In Pushpa Devi Bhagat (dead) through L.R. Sadhna Rai v. Rajinder Singh and Ors. [(2006) 5 SCC 566], this Court held that since no appeal would lie against a compromise decree, the only option available to a party seeking to avoid such a decree would be to challenge the consent decree before the Court that passed the same and to prove that the agreement forming the basis for the decree was invalid. It is therefore imperative that a party seeking to avoid the terms of a consent decree has to establish, before the Court that passed the same, that the agreement on which the consent decree is based, is inval ..... X X X X Extracts X X X X X X X X Extracts X X X X
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