JUDGMENT
S.K. Choudhuri, J.
1. The question for decision in this revision application, which has been referred to the Division Bench is, as to whether a compromise, which has been arrived at between the parties outside Court, requires a document in writing and signed by the parties for recording the same.
2. The relevant facts for decision of this question may be stated here. A money suit, which was registered as Money Suit No. 573 of 1973, was filed by the plaintiff (opposite party 1) in the Court of Munsif, Biharsharif, with a prayer to pass a decree for Rs. 2,450/-, the details of which are given in the plaint, but they are not necessary to be stated here.
3. During the pendency of the suit, according to the defendants, a talk of compromise was finalised on 9th August, 1979, according to which the defendants were to pay a sum of Rs. 1,300/- to the plaintiff in full satisfaction of the claim. According to the defendants the said money was to be paid on 20th August, 1979 and on that date the defendants offered the money to the plaintiff, but he refused to take it. Hence, an application was filed in the Court below under Order XXIII, Rule 3, Civil P.C. to record the compromise. The said application was registered as Miscellaneous Case No. 39 of 1979.
4. The plaintiff-opposite party filed a rejoinder denying those allegations. It was stated that the plaintiff did not authorise his lawyer to compromise the suit. Further allegation was that the compromise was not maintainable as there was no valid and agreed compromise between the parties.
5. In the miscellaneous case, both the parties led their evidence, and the defendants filed an unsigned petition alleged to contain the agreed terms.
6. The trial Court after considering the evidence led by the parties, disbelieved the case put forward by the defendants and accepted the case of the plaintiff as stated in the rejoinder. In view of the aforesaid finding, the trial Court rejected the miscellaneous case and directed the suit to be taken up on merits.
7. Learned Counsel for the petitioner, who were the defendants in the money suit, contended that the alleged compromise comes under the second part of Rule 3, Order XXIII, Civil P.C.
Leaving the proviso and the explanation, the relevant portion of Rule 3, Order XXIII, Civil P.C. is quoted below : —
“(3) Compromise of suits :– Where it is proved to the satisfaction of the Court that a suit has been adjusted wholly or in part by any legal 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.”
In support of the aforesaid contention learned Counsel for the petitioners placed reliance upon a Bench decision in Manohar Lal v. Surjan Singh AIR 1983 Punj & Har 303 in which one of us (S.S. Sandhawalia, C. J.) was a member. Even if the allegation made by the petitioners regarding the compromise are accepted to be true, Manohar Lal’s case (supra) does not help the defendants at all. That was a case where at the stage of arguments, Counsel for both the parties, made statement before the Court to the effect that the parties had compromised and under the said compromise, the defendants undertook to pay Rs. 22,000/-to the plaintiff and the rest of the claim was to be dismissed. A further undertaking of the defendants was to pay the said amount in Court within three months failing which he admitted a further liability to pay Rs. 40,000/-to the plaintiff. The Court concerned, in accordance with the aforesaid statement of the Counsel for the parties, passed a decree and recorded an order directing the decree-sheet to be drawn up accordingly. It is in this set of facts the aforesaid Bench decision of the Punjab & Haryana High Court held that such a compromise falls squarely within the second part of Order XXIII, Rule 3, Civil P.C., which pertains to the satisfaction of the plaintiff by the defendant with regard to the subject-matter of the suit, and thus it did not require a written document to be signed by the parties themselves before it could be acted upon. This decision has clearly pointed out the distinction between the first part and the second part of Rule 3 or Order XXIII, Civil P.C.. The first part visualises a lawful agreement or compromise arrived at out of Court by the parties. It is only such a type of lawful agreement or compromise which requires to be ‘in writing and signed by the parties’. It has been rightly pointed out in that decision that the requirements of ‘in writing and signed by the parties’ appended to the first part of Order XXIII Rule 3, Civil P.C. was to correct the abuse of setting up of an oral agreement or compromise out side Court and the attempt to prolong the matters by leading evidence thereof. It is for this reason that the Legislature mandated that such agreement or compromise must not only be written, but equally it must be signed by the parties.
8. I have already stated the relevant facts of the present case. Admittedly, the alleged compromise was made out of Court and the parties were at variance before the Court when a petition was filed by the defendants in the Court below praying to record the alleged compromise. Such a compromise cannot, by any stretch of imagination, be brought within the second part of Rule 3, Order XXIII, Civil P.C. 1 fully approve the view taken in Manohar LaPs case (supra). As such the alleged compromise for recording it by a Court required a document in writing and signed by the parties, and in absence of such a document, the Court by mandate of the legislature under Rule 3 of Order XXIII cannot take notice of such alleged compromise nor can enter into investigation about the truth or otherwise of the alleged compromise. It will also be apposite to mention here that on the evidence led by the parties, the trial Court recorded a finding against the defendants and accepted the case of the plaintiff-opposite party as stated in the rejoinder which was filed in the miscellaneous case mentioned above.
9. In the result, there is no merit in the application. It is, accordingly dismissed, but in the circumstances of the case there will be no order as to costs.
S. S. Sandhawalia, C. J.
I agree.