Recall Application Before the Court That Recorded the Compromise is the Only Remedy Against a Compromise Decree : Supreme Court
In Navratan Lal Sharma v. Radha Mohan Sharma & Ors., the Supreme Court ruled that if a compromise between parties is not honored, a recall application can be filed to restore proceedings under Order 23 Rule 3 of the Code of Civil Procedure (CPC). The Court clarified that the legality of a compromise agreement can be challenged even after a decree is passed, and emphasized that the right to file for restoration is a statutory remedy under the CPC that cannot be restricted by the terms of the compromise.
The case arose from a decision by the Rajasthan High Court, which had dismissed the appellant's recall application, stating that recording the compromise did not grant the liberty to restore the appeal. The appellant argued that the respondents failed to comply with the compromise terms and sought to restore the proceedings.
The Supreme Court, led by Justices PS Narasimha and Manoj Misra, disagreed with the High Court’s decision and set it aside. The Court stated that the court that recorded the compromise is the appropriate forum to hear a restoration application, as the CPC prohibits filing an appeal or fresh suit to challenge a compromise decree. The Court further emphasized that statutory remedies must be respected and not curtailed by the courts.
The Court also noted that when a statutory remedy exists, there is no need for a court to grant liberty to pursue it. The appeal was allowed, and the case was remanded to the High Court for reconsideration of the recall application on its merits.