In a key ruling reinforcing established civil procedure norms, the Supreme Court has held that a compromise decree cannot be challenged through a fresh suit under the CPC.
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NEW DELHI: In a significant reiteration of settled legal principles, the Supreme Court of India has held that a compromise decree passed under the Code of Civil Procedure (CPC) cannot be challenged by instituting a fresh civil suit.
The apex court clarified that the only recourse available to a party aggrieved by a compromise decree is to approach the court that passed the decree with a recall application, rather than initiating separate proceedings.
The verdict came in the case titled Manjunath Tirakappa Malagi & Anr. v. Gurusiddappa Tirakappa Malagi (Dead Through LRs), bearing neutral citation 2025 INSC 517, wherein a Bench comprising Justice Sudhanshu Dhulia and Justice Ahsanuddin Amanullah dismissed the appeal filed by the Appellants. The Appellants had sought to declare as null and void a compromise decree entered into between members of their family concerning the partition of ancestral property.
Background and Procedural History
The dispute traces back to 2003, when the Appellants filed a suit before the Trial Court, asserting that the compromise decree executed between the Respondents was not binding upon them, as it allegedly involved coercion and lacked their consent. The decree pertained to the partition of ancestral property, which the Appellants claimed a share in.
In 2007, the Trial Court dismissed the suit, finding it not maintainable. This decision was affirmed by the High Court in 2022, which dismissed the first appeal. The Appellants subsequently approached the Supreme Court.
Legal Reasoning and Observations of the Supreme Court
While dismissing the appeal, the Supreme Court placed heavy reliance on Order XXIII Rule 3A of the CPC, which explicitly bars the institution of a suit to set aside a decree based on a compromise, on grounds that such compromise was not lawful.
The Court cited its earlier authoritative decision in Pushpa Devi Bhagat v. Rajinder Singh & Ors. [(2006) 5 SCC 566], where it was held that:
“No appeal is maintainable against a consent decree, having regard to the specific bar contained in Section 96(3) CPC… No independent suit can be filed for setting aside a compromise decree on the ground that the compromise was not lawful, in view of the bar contained in Rule 3A of Order 23 CPC.”
The Bench clarified that Section 96(3) of CPC disallows any appeal from a consent decree. The provision ensures that once a court is satisfied that the compromise is lawful and voluntary, and passes a decree based thereon, such a decree attains finality, and can only be challenged by way of a recall application filed before the same court which passed it.
The Court categorically rejected the Appellants’ argument that their father was coerced by his brothers and father to enter into the compromise. The Bench noted that even if such coercion were assumed to be true, the proper legal remedy would have been for the father to file a recall application, which he failed to do. In fact, the record showed that the father had never disputed the compromise and had even accepted the decree.
“The appellants’ father never approached the court for recall. He not only failed to challenge the consent decree but also admitted its validity. Therefore, the appellants cannot now seek to undo the decree by filing a fresh suit, which is barred in law,”
the Bench observed.
Judgment and Conclusion
Having found no infirmity in the reasoning of the lower courts, the Supreme Court refused to interfere with the judgment dated 23.09.2022 passed by the High Court. The appeal was accordingly dismissed.
Key Takeaway
This decision reaffirms the legal principle that a consent decree cannot be circumvented by filing a new suit. Any aggrieved party must pursue a recall before the court which passed the decree. The ruling upholds the sanctity and finality of compromise decrees and discourages multiplicity of proceedings on issues already settled by lawful compromise.
Appearance:
- For Appellants: AOR Rameshwar Prasad Goyal; Advocate C.M. Angadi
- For Respondents: AOR Nikhil Jain and Anirudh Sanganeria; Advocates Sanket M. Yenagi and Chinmay Deshpande
CASE TITLE: Manjunath Tirakappa Malagi & Anr. v. Gurusiddappa Tirakappa Malagi (Dead Through LRs)
CITATION: 2025 INSC 517
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