http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 2  

PETITIONER: RACHAKONDA VENKAT RAO & ORS.

       Vs.

RESPONDENT: LATE R.SATYA BAI REP. BY HERL.R. SMT. RAJKUMARI & ORS.

DATE OF JUDGMENT:       05/01/1996

BENCH: JEEVAN REDDY, B.P. (J) BENCH: JEEVAN REDDY, B.P. (J) MAJMUDAR S.B. (J)

CITATION:  1996 AIR  965            1996 SCC  (1) 671  JT 1996 (1)   105        1996 SCALE  (1)111

ACT:

HEADNOTE:

JUDGMENT:                          O R D E R      Leave granted. Heard counsel for the parties.      Original Suit  No. 4 of 1975 on the file of the learned District Judge,  Adilabad was instituted by R.Satyabai widow of R.Gopal Rao against the three brothers of her husband. On July 13,  1978, a  decree was made by the Court on the basis of a  compromise between the parties. Under this compromise, the plaintiff was given certain properties exclusively while in some  others she  was given  a joint  interest. Plaintiff having died,  her daughter  and  sole  legal  representative applied, in 1991, for passing a final decree. The defendants (appellants herein)  objected inter  alia on the ground that under a  settlement arrived  at in  1985, the  parties  have finally settled the issue of partition and hence there is no question of  passing a final decree now. They also submitted that when  certain differences arose again between plaintiff and defendants,  they were  settled under  a memo  of family arrangement dated  July 5, 1992, which was said to be signed by all the parties.      The learned  District Judge held, after an enquiry that the 1985  settlement put  forward by  the defendants is true and, therefore,  the application  for passing a final decree is liable  to fail.  On revision (filed by the plaintiff), a learned Single  Judge of  the High  Court held that Order 23 Rule 3,  as amended  in 1976,  does not  recognize  an  oral settlement and hence the 1985 settlement could not have been accepted by  the Court. The learned Single Judge pointed out further that  when even according to the defendants the 1985 settlement has  been superseded  by the 1992 settlement, the 1985 settlement  could not  be  held  to  per  final  decree proceedings. The  learned Single  Judge also referred to the finding  of   the  learned  District  judge  that  the  1992 settlement/family arrangement  is  not  established  by  the defendants.      Sri  K.Madhava   Reddy,   learned   counsel   for   the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 2  

defendants-appellants pointed  out that  by virtue of clause (S) in  sub-section (2) of Section 97 of the Civil Procedure Code (Amendment)  Act, 1976, the amendment effected in Order 23 Rule  3 of the Civil Procedure Code has no application to pending suits  and proceedings  and, therefore,  the learned Single Judge  was in  error in holding that 1985 settlement, being oral,  cannot be  looked into  by the  Court.  Learned counsel pointed  out that  the learned  District  Judge  has found the  said settlement  to be  true on  the basis of the evidence adduced by the parties. Another objection raised by him is  that the compromise decree passed in 1978 was itself a  final  decree  and  that  it  does  not  contemplate  any proceedings being  taken for passing a final decree. Learned counsel also  stated that  his clients are prepared to stand by either  the 1985  settlement or  the 1992  arrangement if either of them is acceptable to the plaintiff.      Learned counsel  for the  appellants is  right  in  his submission that  by virtue  of Section 97(2)(s) of the Civil Procedure Code (Amendment) Act, 1976, "the amendment as well as substitution made in Order XXIII of the First Schedule by Section 74  of this  (Amendment) Act  shall not apply to any suit or  proceeding pending  before the  commencement of the said Section  74." The  present suit was instituted in 1975. Hence there  is no  legal  bar  to  the  defendants  putting forward the  oral  settlement  of  1985  as  a  bar  to  the application filed  by the  plaintiff  for  passing  a  final decree. Unfortunately,  this aspect  was not  brought to the notice of  the learned  Single Judge.  In  as  much  as  the judgment  of  the  learned  Single  Judge  is  substantially influenced by  reliance upon  amended Order 23 Rule 3 of the Civil Procedure Code, the proper course in our opinion is to send the matter back to the High Court for a reconsideration of the revision petition (C.R.P. 1594 of 1993) in accordance with law.  We make it clear that we should not be understood to have  expressed any  opinion on  any  issue  between  the parties and  all such  issues as  are arising  in the C.R.P. shall be  open for  consideration by the High Court. We have expressed ourselves  only on  the effect of Section 97(2)(s) of the  Civil Procedure Code (Amendment) Act, 1976 and on no other question.      The  appeal   is  accordingly   allowed.  The  impugned judgment of  the High  Court is  set aside  and  the  matter remitted to  the High  Court with  the above  directions. No costs.