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Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 2050-2053  OF 2013 [Arising out of SLP (Civil) Nos. 126-129 of 2012]

Mahalaxmi Co-operative Housing Society Ltd. & Etc. ..  

Appellants

Versus

Ashabhai Atmaram Patel (D) Th.Lrs  and Others        .. Respondents

J U D G M E N T

K. S. Radhakrishnan, J.

1. Leave granted.

2. These appeals arise out of a common judgment rendered  

by a learned single Judge of the High Court of Gujarat disposing  

of six special civil applications of which we are concerned with  

the  appeals  preferred  against  Special  Civil  Application  Nos.  

7088 of 2010, 10084 of 2009, 11925 of 2009 and 7087 of 2010.

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The  learned  single  Judge,  in  exercise  of  his  powers  under  

Articles 226 and 227 of the Constitution of India quashed the  

orders dated 14.08.2008 and 08.09.2009 passed in Special Civil  

Suit  No.  292/1993  and  Special  Civil  Suit  No.  681/1992  

respectfully  by  the  Learned  Civil  Judge  (SD)  of  Ahmadabad  

(Rural)  and remanded the matter to the court,  after reviving  

the  interim order  dated  28.05.1993  passed  in  Civil  Suit  No.  

292/1993.

3. Civil  Suit  No.  292 of 1993 was preferred by respondent  

No.4 - Chandrakant Atmaram Patel and respondent nos. 1 to 5  

herein (purchasers) against respondent no. 6 – Bai Saraswati  

and  the  appellant  herein  –  Mahalaxmi  Co-operative  Housing  

Society Ltd.  (for  short  ‘Mahalaxmi  Society’)  for  a  declaration  

that sale deeds dated 5.6.1992 and 8.6.1992 were illegal and  

also  for  an  order  of  permanent  injunction  restraining  the  

Mahalaxmi  Society  from dealing  with  the  lands  and also  for  

other  consequential  reliefs.   Chandrakant  Atmaram  Patel,  

plaintiff  no.  1,  plaintiff  no.  2  are  the  heirs  of  the  deceased  

Baldevprasad (respondent nos. 5/1 and 5/2 herein), the plaintiff  

no. 3 are heirs of Manilal Bechardas (respondent nos. 3/1 and  

3/2 herein), plaintiff no. 4 is Ashabai Patel (since deceased) and

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now through Legal Representatives – respondent nos. 1/1/A to  

1/1/D) and plaintiff no. 5 are heirs of Amrutlal Patel (respondent  

nos. 2/1, 2/2, 2/3 and 7 herein), along with the plaint filed an  

application for  temporary  injunction,  which was allowed vide  

order dated 28.5.1993.  One Jankalyan Co-operative Housing  

Society sought intervention in the suit Civil Suit No. 292/1993  

on the basis of a registered Agreement to Sell dated 15.6.1992  

and joined as defendant no. 3.  Civil Suit No. 681/1992 was also  

a  suit  filed  by  respondent  Nos.  1  to  5  against  the  Deputy  

Collector,  the appellant herein and the 6th respondent for  an  

order of permanent injunction on the ground that no permission  

under  Section  63  of  the  Tenancy  Act  was  obtained  before  

executing various sale deeds.   

4. We have to  trace  the  facts  leading  to  the  filing  of  the  

above suits and the disputes cropped up thereafter between  

the original plaintiffs, Bai Saraswati and the Mahalaxmi Society,  

leading to the filing of pursis dated 7.7.2008 and 18.09.2008  

and the steps they have taken for resolving those disputes in  

Civil Suit No. 292 of 1993 and Civil Suit No. 681/1992.

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5. Bai Saraswati – respondent no. 6 herein – had executed  

two Sale Deeds dated 27.10.1964 in respect of separate non-

contiguous  parcels  of  lands  in  favour  of  five  persons  i.e.  

respondent nos. 1 to 5.  Respondent nos. 1 to 5 (purchasers)  

formed  a  partnership  firm  in  the  name  of  M/s  Arbuda  

Corporation  on  4.3.1965  to  deal  with  the  above-mentioned  

properties  and  each  partner  had  equal  share.   M/s  Arbuda  

Corporation  on  15.9.1975  executed  an  Agreement  to  Sell  in  

favour  of  the  Mahalaxmi  Society  in  respect  of  the  above-

mentioned lands.  

6. The Urban Land (Ceiling and Regulation) Repeal Act, 1999  

(for short ‘the ULC Act’) came into force in 1976.  M/s Arbuda  

Corporation and the appellant Mahalaxmi Society jointly made  

an  application  under  Section  20  of  the  ULC  Act  seeking  

permission  to  execute  the  sale  deed  before  the  Deputy  

Collector, Ahmadabad.   Similar applications were also filed by  

the  appellant  –  Bai  Saraswati  and  respondent  No.  4  –  

Chandrakant  Atmaram Patel.   On  7.1.1989,  respondent  nos.  

5/1, 5/2 and 5/3, respondent nos. 3/1 and 3/2, respondent no. 1  

(since  deceased)  and  respondent  no.  2  (since  deceased)  

executed a Power of Attorney  in favour of respondent No. 4 –

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Chandrakant Atmaram Patel in respect of the above-mentioned  

properties.   The  power  of  attorney  provided  that  the  same  

would be binding on respondent nos. 1, 2, 3 and 5 and their  

descendants, guardians and heirs.   On 1.5.1991, Bai Saraswati  

executed an Agreement to Sell with possession of the above-

mentioned  properties  in  favour  of  the  Mahalaxmi  Society.  

Permission sought for under Section 20 of the ULC Act was also  

granted by the authority on Bai Saraswati for dealing with the  

properties.   

7. Bai  Saraswati  then  executed  two  sale  deeds  dated  

5.6.1992 and 8.6.1992 in favour of the Mahalaxmi Society in  

respect  of  the  above-mentioned  properties,  which  lead  to  

various disputes between the Mahalaxmi Society, Bai Saraswati  

and the five purchasers mentioned earlier.

8. Respondent  Nos.  1-5  then filed Special  Civil  Application  

No. 4413 of 1992 before the High Court against the Mahalaxmi  

Society and Bai Saraswati and the State of Gujarat challenging  

the order dated 3.6.1992 passed under Section 20 of the ULC  

Act and that order was stayed, so also the further proceedings  

thereto.  Respondent Nos. 1-5, as plaintiffs, filed Special Civil

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Suit no. 681 of 1992 against the Deputy Collector, Ahmadabad,  

Mahalaxmi Society and Bai Saraswati on 31.07.1992 praying for  

an injunction restraining the grant of permission under Section  

63 of the Tenancy Act,  which was,  however,  granted on the  

same day.   Consequently,  Special  Civil  Suit No.  681 of 1992  

was later amended challenging the grant of permission.

9. As already stated, respondent Nos. 1 to 5 had also filed  

Civil  Suit  No.  292/1993 on 04.05.1993 against  Bai  Saraswati  

and the Mahalaxmi Society for a declaration that the sale deeds  

dated  05.06.1992  and  08.06.1992  were  illegal  and  also  for  

other consequent reliefs.  Bai Saraswati, later, executed a sale  

deed dated 18.10.2000 in respect of the remaining survey no.  

216 in favour of the Mahalaxmi Society.

10. Plaintiffs, Bai Saraswati and Mahalaxmi Society, in view of  

the various transactions entered into between various parties  

and  the  pending  litigations  were  exploring  the  possibility  of  

settling  all  their  disputes.   As  a  follow  up,  the  Mahalaxmi  

Society, paid an amount of Rs.29,72,365/- to the plaintiffs by  

various  cheques  and  a  Notarised  Acknowledgement-cum-

Settlement  receipt  was  also  issued  on  1.5.2004,  which  is

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reflected in the registered Deed of Confirmation dated 1.5.2004  

executed by  Chandrakant Atmaram Patel, the first plaintiff for  

and on behalf of other plaintiffs on the strength of the power of  

attorney dated 7.01.1989.  The first plaintiff  also executed a  

declaration-cum-indemnity  of  title  on  09.11.2004  wherein  it  

was  stated  that  the  Mahalaxmi  Society  was  the  full,  legal,  

proper  and  absolute  owner  and  possessor  of  the  properties  

mentioned therein.  Plaintiffs had also agreed to cooperate in  

obtaining  appropriate  orders  in  Special  Civil  Suit  No.  681  of  

1992 and Special  Civil  Suit  No.  292 of  1993,  in  view of  the  

compromise and settlement.   

11. Plaintiff  no.  1  –  Chandrakant  Atmaram  Patel  had  also  

executed  various  documents  individually.   He  executed  a  

registered Deed of Confirmation dated 10.11.2004, referring to  

the  payment  of  Rs.29,72,365/-  by  the  Mahalaxmi  Society.  

Reference was also made to the receipt dated 1.5.2004 and the  

registered Deed of Confirmation dated 1.5.2004 acknowledging  

the receipt of Rs.29,72,365/-  from the Mahalaxmi Society by  

plaintiff No. 1 as power of attorney holder for himself and on  

behalf  of  the  other  plaintiffs  as  well.   Registered  articles  of  

agreement dated 10.11.2004 also refer to a further payment of

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Rs.66,05,527/- by the Mahalaxmi Society which was received  

by plaintiff No. 1 – Chandrakant Atmaram Patel.  Declaration-

cum-indemnity of title was also made on 10.11.2004, wherein it  

was stated that Mahalaxmi Society had the full, legal, proper  

and  absolute  owner  and  possessor  of  the  above-mentioned  

lands.    

12. Plaintiff  No.  2  –  heirs  of  Baldevprasad  Jamnadas  –  had  

individually  executed  a  registered  Deed  of  Confirmation  on  

10.11.2004,  referring  to  the  payment  of  Rs.29,72,365/-  and  

proportionate payment of Rs.5,94,473/-.  The documents also  

refer  to  the  Deed  of  Confirmation  dated  01.05.2004.  

Registered Article of Agreement dated 11.11.2004 executed by  

the  plaintiff  No.2  also  refers  to  a  further  payment  of  

Rs.66,05,527/- made to the heirs of Baldev Prasad Jamnadas.  

Declaration-cum-Indemnity of Title dated 10.11.2004 executed  

by  them acknowledged that  the  Mahalaxmi  Society  was  the  

legal  and  absolute  owner  and  was  in  possession  of  the  

properties.

13. Plaintiff Nos. 5/1 to 5/4, heirs of Amrutbhai Patel, had also  

individually executed various documents.   Registered Deed of

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Confirmation dated 10.11.2004 executed by them also referred  

to  the  payment  of  Rs.29,72,365/-  and  the  proportionate  

payment  of  Rs.5,94,473/-.   Registered  Articles  of  Agreement  

executed by them on the same day also  referred to  further  

payment of Rs.66,05,527/-.   Declaration-cum-Indemnity of Title  

executed  on  10.11.2004  also  referred  to  the  interest  of  

appellant Mahalaxmi Society.   

14. Plaintiff Nos. 3/1, 3/2 and plaintiff No. 4, however, issued a  

public  notice  on  5.12.2004 in  the  local  newspapers  (Gujarat  

Samachar and Dainik Bhaskar) cancelling the power of attorney  

dated  7.1.1989  executed  in  favour  of  plaintiff  No.  1  –  

Chandrakant Patel.  Mahalaxmi Society, through their Solicitor,  

on 11.12.2004, issued a public notice in the local newspaper  

(Sandesh) inviting claims/objections to the title of Mahalaxmi  

Society.  On 16.12.2004, plaintiff Nos. 3/1, 3/2 and plaintiff No.  

4 gave their replies.

15. Plaintiff  No.  4 (who later  expired on 2.6.2006) had also  

executed a registered Deed of Confirmation on 5.1.2005, which  

acknowledged  the  payment  of  Rs.29,72,365/-.    In  the  

registered Articles of Agreement dated 5.1.2005, plaintiff No. 4

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had  acknowledged  the  receipt  of  payment  of  an  additional  

amount of Rs.30,05,527/-.  He had also referred to the interest  

of Mahalaxmi Society in the Declaration-cum-Indemnity of Title  

executed on the same day.

16. Plaintiff  nos.  1,  2/2,  2/2,  4 and 5/1 to 5/4 (all  plaintiffs,  

except  plaintiff  No.  3)  through  their  advocates  published  a  

notice  in  the  local  newspapers  (Sandesh,  Gujarat  Samachar,  

Divya  Bhaskar)  confirming  the  above  said  facts  as  also  the  

execution of documents.  They had indicated that it was after  

the execution of all the above said documents and receipt of  

payments,  plaintiff  No.  4  had  expired  on  2.6.2006.  

Respondent nos. 1/1/A to 1/1/D, the legal heirs of plaintiff no. 4,  

it  is  seen,  did not  take any steps to implead themselves as  

heirs in the two suits, namely, Special Civil Suit No. 681 of 1992  

and Civil Suit No. 292 of 1993.  Plaintiff No. 1 – Chandrakant  

Atmaram Patel – in the wake of the above-mentioned facts and  

circumstances,  prepared a  pursis  on 7.7.2008,  the operative  

portion of which reads as under:

“By  filing  following  pursis,  I,  plaintiff  declare  before the Hon’ble Court that outside court, amicable  settlement  has  been  arrived  at  between  me  and  defendants.  I, plaintiff, admit Registered Sale Deeds,

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bearing Sr.  No.  13875,  13881,  1891,  13873,  13886  and 13896 dated 5/6/92 and All Registered Sale Deed  No. 14034 dated 8/6/92 and Registered Sale Deeds,  Sr. No. 4024 and 4028, dated 18/10/2000 executed  by  original  landlord,  Bai  Saraswari  d/o  Ashabhai  Revandas  in  favour  of  Mahalaxmi  Co-0p.  Housing  Society Limited in respect of suit property mentioned  by the plaintiff in the suit application of this case and  in this regard, Registered Deeds of Agreement jointly  and  separately.   The  said  Registered  Deeds  of  Agreement  have been produced,  vide separate list,  by us.   The facts mentioned in the said Registered  Deeds of Agreement are proper, true and legal.  As  stated in the said Deeds of Agreement, the ownership  right and possession of the said suit  property have  been received by Mahalaxmi Co-op. Housing Society  Limited.  In the said suit property, I, plaintiff, have no  right,  authority  or  possession.   As per  said facts,  I,  plaintiff, unconditionally waive all contentions raised  by us in this suit and by undergoing cost of the said  suit, I compound the same. Ahmedabad Dated: 7/7/2008                             Sd/-

   (Chandrakant  Atmaram  Patel)”

The same was filed before the Court.   Defendant No.  3 and  

plaintiff  Nos.  3/1  and  3/2  filed  objections  to  the  pursis  on

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31.7.2008.   Plaintiff No. 1 – Chandrakant Atmaram Patel, on  

13.9.2008, filed an affidavit before the Court stating that the  

pursis was given in his individual capacity and in his capacity of  

power  of  attorney  holder  of  plaintiff  Nos.  2,  4  and  5  and  

produced the power of attorney dated 7.1.1989 before the trial  

court.  The trial court vide its order dated 14.8.2008 allowed  

the pursis (Ext.110) and accorded permission to compound the  

suit.   Pursuant  to  the  above  mentioned  settlement  and  

compromise,  a  similar  pursis  dated 18.9.2008 (Ext  172)  was  

also filed in Special Civil Suit No. 681 of 1992, which was also  

disposed of on 8.9.2009 accepting the same.

17. Plaintiff  Nos.  3/1 and 3/2,  as already stated,  challenged  

the judgment and order dated 14.8.2008 by filing Special Civil  

Application no. 10884 of 2009, under Articles 226 and 226 of  

the  Constitution  of  India.   Plaintiff  Nos.  3/1  and  3/2  also  

challenged  the  order  dated  8.9.2009  by  filing  Special  Civil  

Application No. 11929 of 2009.  The heirs of plaintiff No. 4 also  

challenged  the  above-mentioned order  by  filing  Special  Civil  

Application no.  7097 of  2010 and the heirs  of  the deceased  

plaintiff  no.  4 also filed Special  Civil  Application no.  7087 of  

2010.  Heirs of plaintiff No. 4 and plaintiff Nos. 5/1 and 5/2 also

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challenged the  judgment  and order  dated 8.9.2009 by  filing  

Special  Civil  Application  no.  7088  of  2010.   The  High  Court  

disposed  of  those  applications  by  a  common  judgment  on  

19.12.2011, the legality of which is under challenge in these  

appeals.

18. Mr.  Mukul  Rohatgi,  learned senior  counsel  appearing on  

behalf of the appellant,  at the outset,  raised the question of  

maintainability of the writ petitions filed before the High Court  

under  Articles  226  and  227  of  the  Constitution  by  the  

respondents, on the ground that the orders assailed before the  

High Court dated 14.8.2008 and 08.09.2009 were the orders  

passed by the trial  Court in exercise of its  powers conferred  

under the proviso to Rule 3 of Order XXXIII of the Code of Civil  

Procedure (for short ‘CPC’).  Learned senior counsel submitted  

that, at best, the remedy available to the respondents was to  

file an appeal under Section 96 read with Order XLIII Rule 1A(2)  

and Order XLI CPC before the appellate Court.  Learned senior  

counsel submitted that the pursis was preferred under Order  

XXIII Rule 3 CPC and not under Order XXI Rule 1 CPC.   Learned  

senior counsel submitted that the order dated 14.8.2008 falls  

under the second part of Order XXIII Rule 3 CPC and hence it

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would  be  sufficient  that  plaintiffs  or  the  plaintiffs’  counsel  

appears before the Court and informs the Court that the subject  

matter  suit  had  been  settled  or  satisfied.   Learned  senior  

counsel also submitted that the heirs of the deceased plaintiff  

no.  4  and  plaintiff  nos.  5/1,  5/2  and  5/4  could  not  have  

preferred the writ petitions under Articles 226 and 227 of the  

Constitution  of  India,  since the same could  have resulted  in  

setting aside of the abetment which was contrary to law in view  

of Order XXII CPC.  Plaintiff No. 4 had died on 2.6.2006 and Civil  

Suit no. 292 of 1993 had, as such, abated qua the deceased  

plaintiff no. 4.   Since the heirs, who are respondent nos. 1/1/A  

to 1/1/D, did not take any steps to implead themselves as heirs  

either in Civil Suit No. 292 of 1993 or in Special Civil Suit No.  

681 of 1992, on expiry of the period of limitation under Articles  

120 and 121 of the Limitation Act, those suits stood abated qua  

plaintiff No. 4.   The heirs of the deceased plaintiff no. 4 had not  

taken any steps for setting aside the abetment or to get them  

substituted  on  the  death  of  deceased  plaintiff  No.  4  in  the  

various suits.  Further, it was also pointed out that plaintiff Nos.  

5/1 to 5/4 had never objected to the pursis dated 7.7.2008 and  

hence  acquiesced  to  the  order  dated  14.8.2008  and  are

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estopped from challenging that order.  Learned senior counsel  

submitted that all disputes with plaintiff Nos. 3/1 and 3/2 were  

also settled during the pendency of  these appeals  and their  

objections before the trial Court under Special Civil Application  

Nos.  10884  and  11925  of  2005  did  not  survive.   Further,  

learned  senior  counsel  also  pointed  out  that  the  power  of  

attorney dated 7.1.1989 executed by respondent Nos. 5/1, 5/2  

and 5/3, respondent Nos. 3/1 and 3/2, respondent No. 1 (since  

deceased) and respondent No. 2 (since deceased) in favour of  

respondent No. 4 – Chandrakant Atmaram Patel,  was binding  

on respondent Nos. 1, 2, 3, 5 and their descendants, guardians  

and heirs.  Learned senior counsel also submitted that, pending  

the  Special  Civil  Application  before  the  High  Court,  building  

plans put up by Mahalaxmi Society for construction upon the  

lands in question, were sanctioned by the competent authority  

and  Mahalaxmi  Society  had  commenced  the  construction.  

Learned senior counsel submitted that large amounts were paid  

by Mahalaxmi Society to the owners of the properties and to  

the  respondents  and  their  representatives  and  they  had  

acknowledged the receipt of those amounts.  The judgment of  

the  High  Court  has  now  unsettled  the  things  which  stood

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settled.  Consequently, learned senior counsel prayed that the  

appeals be allowed and the judgment of the High Court be set  

aside.

19. Shri J.M. Patel, learned counsel appearing on behalf of the  

contesting  respondents,  submitted  that  the  High  Court  has  

rightly set aside the order dated 14.8.2008 and directed the  

trial Court to take into consideration the objections raised by  

the respondent herein and to re-hear Exh. Nos. 110 and 172.  

Learned senior counsel submitted that the suit was withdrawn  

without  consent  of  plaintiff  Nos.  5/1  to  5/4  by  Chandrakant  

Atmaram Patel.   Further, it was pointed out that no documents  

were  produced  before  the  trial  Court  pointing  out  that  the  

above  mentioned  plaintiffs  had  executed  any  document  in  

favour  of  Mahalaxmi  Society.   Learned  senior  counsel  also  

pointed out that Bai Saraswati had fraudulently, unauthorizedly  

and  illegally  made  an  application  before  the  authority  for  

seeking  permission  under  Section  63  of  the  Tenancy  Act  to  

transfer the land in question in favour of Mahalaxmi Society.  

Following that, two registered sale deeds dated 5.6.1992 and  

8.6.1992 were executed in favour Mahalaxmi Society, which is  

in clear violation of Section 63 of the Tenancy Act read with

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Section 23 of the Contract Act.   Learned senior counsel also  

pointed out that the plaint in Civil  Suit No. 292 of 1993 was  

instituted  in  his  individual  capacity  and  not  as  a  power  of  

attorney holder for rest of the plaintiffs.  Learned senior counsel  

also pointed out that Chandrakant Atmaram Patel on 15.5.2004  

executed  one  registered  document  in  favour  of  Mahalaxmi  

Society, signed and executed for and on behalf of Amrutbhai  

Ashabai Patel (heirs of Legal Representatives are plaintiff Nos.  

5/1  to  5/4)  and also signed on behalf  of  Bai  Saraswati,  who  

expired on 22.5.1992, before the institution of suit, on relying  

upon the power of attorney dated 7.1.1989.   Learned senior  

counsel pointed out that the document executed in the name of  

and on behalf of dead persons and also for the persons who  

had not authorized them to sign, such a document, according  

to the learned senior counsel, could not have been produced  

before the Court.

20. Learned  senior  counsel  appearing  on  behalf  of  the  

contesting respondents also submitted that the impugned order  

dated 14.8.2008 is not a decree within the meaning of Section  

2(2) CPC and hence,  no appeal  could have been filed under  

Section 96 read with Order XLIII Rule 1(1) and Order XLI CPC

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before the trial Court.  Learned senior counsel also submitted  

that the contents of the power of attorney dated 7.1.1989 do  

not  empower  Chandrakant  Atmaram  Patel  to  withdraw  the  

suits, compound the suits for and on behalf of plaintiff Nos. 4  

and 5 and the Court should not have allowed the application  

withdrawing the suit.    Learned senior counsel submitted that  

the High Court has rightly set aside the order dated 14.8.2008  

and  remanded  the  matter  to  the  trial  Court  for  fresh  

consideration  and  no  prejudice  would  be  caused  to  the  

appellants, if the validity of Exts. 110 and 172 are re-examined.  

Learned senior counsel also submitted that this Court, sitting in  

Article 136 of the Constitution of  India,  shall  not  disturb the  

above finding of the High Court.   

21. Dr. Rajeev Dhawan, learned senior counsel appearing for  

the intervener submitted that the purchasers, landowner and/or  

their legal heirs viz. Chandrakant Atmaram Patel had entered  

into an agreement dated 15.06.1992 with the intervener which  

was registered and hence it has right, title and interest over the  

property in question.  Further, it was also pointed out that the  

intervener  has  already  filed  a  suit  RCS  783/2004  which  is  

pending consideration before the civil court and hence it has

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interest  in  these  proceedings.   Learned  senior  counsel  also  

submitted that  the whole matter  should go back to the trial  

court so as to safeguard the interest of the intervener.  

22. We  have  already  referred  to  the  facts  leading  to  the  

making of pursis dated 7.7.2008 and 18.09.2008 by plaintiff No.  

1 – Chandrakant Atmaram Patel for himself  and as power of  

attorney holder for others and the orders passed thereon on  

14.08.2008  and  08.09.2009  allowing  the  pursis  and  

compounding the suits Nos. 292/1993 and 681/1992.  

23. Bai Saraswati, as already indicated, had executed two sale  

deeds dated 27.10.1964 in respect of separate/non-contiguous  

parcels of land in favour of respondent nos. 1 to 5.  Schedule to  

that  documents  refer  to  the  survey  numbers  and properties  

sold.  Respondent No. 1 to 5 (purchasers) formed a partnership  

firm by name M/s Arbuda Corporation and they executed an  

agreement  to  sell  dated  15.9.1975  in  favour  of  Mahalaxmi  

Society in respect of the properties above-mentioned.  Later,  

M/s Arbuda Corporation and Mahalaxmi Society jointly made an  

application in the year 1976 under Section 20 of the ULC Act.  

Similar applications were also filed by Mahalaxmi Society, Bai

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Saraswai and respondent No. 4 – Chandrakant Atmaram Patel.  

Respondent nos. 5/1, 5/2 and 5/3, respondent nos. 3/1 and 3/2,  

respondent No. 1 (since deceased) and respondent No. 2 (since  

deceased)  had on 07.01.1989 executed a power  of  attorney  

before  the  Public  Notarized  Civil  Court,  Ahmedabad  city,  in  

favour  of respondent No.  4 –  Chandrakant Atmaram Patel  in  

respect of properties mentioned earlier conferring authority on  

him to  deal  their  property  for  other  plaintiffs  and the  same  

would  be  binding  on  respondent  Nos.  1,  2,  3,  5  and  their  

descendants, guardians and heirs.  Bai Saraswati, after getting  

permission under the ULC Act executed two sale deeds dated  

5.6.1992  and  8.6.1992  in  favour  of  Mahalaxmi  Society  in  

respect of properties mentioned earlier.   

24. We  notice  that  disputes  then  cropped  up  between  

Mahalaxmi Society, Bai Saraswati and respondent Nos. 1 to 5  

(purchasers), which ultimately led to the filing of Special Civil  

Suit No. 681 of 1992, the details of which have already been  

stated in the earlier part of this judgment, hence not reiterated.  

Respondent Nos. 1 to 5 as plaintiffs then filed Civil Suit No. 292  

of  1993  against  Bai  Saraswati  and  Mahalaxmi  Society  on  

4.5.1993 for a declaration that sale deeds dated 5.6.1992 and

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8.6.1992 are illegal and for a permanent injunction restraining  

Mahalaxmi  Society  from dealing  with  the  lands.   Plaint  was  

signed by  respondent  No.  4  -   Chandrakant  Atmaram Patel,  

plaintiff No. 2 who are heirs of deceased Baldevprasad (present  

respondent Nos. 5/1 and 5/2), plaintiff no. 3 who are heirs of  

Manilal  Patel  (present respondent Nos.  3/1 and 3/2),  plaintiff  

No. 4 Ashabhai Patel (since deceased) now through respondent  

Nos. 1/1/A to 1/1/D and plaintiff No. 5 who are heirs of Amrutlal  

Patel (present respondent Nos. 2/1, 2/2, 2/3 and 7).   Contesting  

respondents, therefore, were duly represented in Civil Suit No.  

292 of 1993.

25. Bai  Saraswati  on  18.10.2000  executed  a  sale  deed  in  

respect  of  one  remaining  survey  No.  216  in  favour  of  

Mahalaxmi Society as well.  While the above mentioned suits  

were pending, efforts were made for settling the entire disputes  

between parties,  consequently,  plaintiff  No.  1  -  Chandrakant  

Atmaram Patel, for himself and as power of attorney holders for  

other plaintiffs executed various documents and entered into  

various transactions.   Plaintiff No. 1 for and on behalf of other  

plaintiffs  received  an  amount  of  Rs.29,72,326/-  made  by  

Mahalaxmi  Society  by  various  cheques,  evidenced  by  the

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Notarized  Acknowledgement-cum-Settlement  Receipt  dated  

1.5.2004.  On the same day, a Deed of Confirmation was also  

registered, which also refers to the above mentioned payment  

made  by  Mahalaxmi  Society  to  the  plaintiffs.   In  the  

Declaration-cum-Indemnity  of  Title  dated  9.11.2004,  it  has  

been clearly  stated that  Mahalaxmi Society is  the full,  legal,  

proper  and  absolute  owner  and  possessor  of  the  above  

mentioned properties.  Further, it is also provided in the said  

declaration  that  the  plaintiffs  had  agreed  to  co-operate  in  

obtaining appropriate orders from the Court in pending cases,  

including Special Civil Suit No. 681 of 1992 and Civil Suit No.  

292  of  1993,  in  view  of  the  compromise  and  settlement.  

Though,  at  that  stage,  proportionate  amount  was  given  to  

plaintiff No. 3, he did not encash the same.  Above-mentioned  

are the documents executed by plaintiff No. 1 for himself and  

on behalf  of  other plaintiffs  on the strength of the power of  

attorney dated 7.1.1989.

26. Plaintiff  No.  1  individually  also,  apart  from  the  above  

mentioned documents,  executed various other documents as  

well,  which re-enforces and re-confirms the above mentioned  

transactions entered into by Chandrakant Atmaram Patel – as

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power of attorney holder for four other plaintiffs.   Plaintiff No. 1  

executed  a  Registered  Deed  of  Confirmation  on  10.11.2004  

which specifically refers to the payment of Rs.29,72,365/- by  

Mahalaxmi  Society.   Deed  also  indicates  that  plaintiff  no.  1  

personally,  unconditionally  an  irrevocably  without  any  

reservation  or  restriction  whatsoever  accepted,  confirmed,  

acknowledged and admitted the Deed of  Confirmation dated  

1.5.2004, which was executed by plaintiff no. 1 for himself on  

behalf  of  other  plaintiffs  on  the  strength  of  the  power  of  

attorney dated 7.1.1989.    Registered Articles  of  Agreement  

executed on the same day also refers to further payment of  

Rs.66,05,527/- being made to plaintiff No. 1.  The Declaration-

cum-Indemnity  of  Title  executed  on  the  same  day  also  

recognises that Mahalaxmi Society is in full, legal, proper and  

absolute owner and possessor of the above mentioned lands.  

27. Plaintiff  No.  2,  heirs  of  Baldevprasad  Jamunadas,  

individually also executed various documents, apart from the  

documents dated 1.5.2004 and 9.11.2004 executed by plaintiff  

No. 1 on the strength of the power of attorney, representing  

plaintiff No. 2 as well.  Plaintiff no. 2 executed, on 11.11.2004, a  

Registered Deed of Confirmation acknowledging the payment

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of Rs.29,72,365/- of the Mahalaxmi Society and proportionate  

payment of Rs.5,94,473/-.   Plaintiff No. 2 in the said deed of  

confirmation,  personally,  unconditionally  and  irrevocably  

without  any  reservation  or  restriction  whatsoever  accepted,  

confirmed,  acknowledged  and  admitted  the  deed  of  

confirmation dated 1.5.2004 executed by plaintiff no. 1 on his  

behalf and on behalf of other plaintiffs.  Registered Articles of  

Agreement  dated  11.11.2004  also  recognises  the  further  

payment of Rs.66,05,527/-.   Declaration-cum-Indemnity of Title  

made on the same day also indicates that Mahalaxmi Society is  

the full, legal, proper and absolute owner and possessor of the  

above mentioned lands.

28. Plaintiff Nos. 5/1, 5/2, 5/3 and 5/4 – heirs of Amrutlal Patel  

had also individually executed various documents.  Registered  

Deed of Confirmation dated 10.11.2004 refers to the payment  

of  Rs.29,72,365/-  by  the  Mahalaxmi  Society  and  the  

proportionate payment of Rs.5,94,473/-.  Plaintiff Nos. 5/1, 5/2,  

5/3 and 5/4, in the said deed of confirmation has personally,  

unconditionally  an  irrevocable  without  any  reservation  or  

restriction whatsoever accepted, confirmed, acknowledged and  

admitted the deed of confirmation dated 1.5.2004 executed by

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plaintiff No. 1 on the strength of the power of attorney dated  

7.1.1989.   Registered Articles of Agreement dated 10.11.2004  

also refers to further payment of Rs,66,05,527/- being made to  

plaintiff Nos. 5/1, 5/2, 5/3 and 5/4.  Declaration-cum-Indemnity  

of Title of the same date would also indicate that Mahalaxmi  

Society  is  the  full,  legal,  proper  and  absolute  owner  and  

possessor of the above mentioned lands.    

29. Plaintiff  No.  4  had  also  individually,  in  addition  to  the  

documents  dated  1.5.2004  and  19.11.2004  executed  by  

plaintiff  No.  1,  executed  a  Registered  Deed  of  Confirmation  

dated 5.1.2005 acknowledging the payment of Rs.29,72,365/-.  

In that deed also, plaintiff No. 4 has personally, unconditionally  

and  irrevocably  without  any  reservation  or  restriction  

whatsoever accepted, confirmed, acknowledged and admitted  

the deed of confirmation dated 1.5.2004 executed by plaintiff  

No.  1.    Plaintiff  no.  4  had also,  vide  Registered  Articles  of  

Agreement,  acknowledged  the  receipt  of  the  additional  

payment of Rs.30,05,527/- on the same day.  Declaration-cum-

Indemnity  of  Title  dated  5.1.2005  also  acknowledges  that  

Mahalaxmi Society is the full, legal, proper and absolute owner  

and possessor of the above mentioned lands.

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30. Above facts would clearly indicate that plaintiff No. 1 on  

5.1.2005 had executed documents  as  the power of  attorney  

holder and also on his individually capacity, plaintiff Nos. 2/1,  

2/2, plaintiff No. 4 and plaintiff Nos. 5/1, 5/2 and 5/4 had also  

executed documents and settlement acknowledging the receipt  

of  payments  made  by  Mahalaxmi  Society  and  also  

acknowledging that Mahalaxmi Society is the full, legal, proper  

and  absolute  owner  and  possessor  of  the  above  mentioned  

properties.  Further, on 9.11.2005, plaintiff Nos. 1, 2/1, 2/2, 4  

and 5/1 to 5/4, through their advocate, published a notice in  

the local newspaper confirming the above mentioned facts and  

also the execution of the documents,  thereby acknowledging  

that  Mahalaxmi  Society  is  the  true,  full,  legal,  proper  and  

absolute  owner  and  possessor  of  the  above  mentioned  

properties.

31. Plaintiff  Nos.  3/1,  3/2  and  plaintiff  no.  4,  however,  had  

issued  a  public  notice  dated  05.12.2004  in  the  local  

newspapers, cancelling the power of attorney dated 7.1.1989  

executed in favour of plaintiff No. 1 -  Chandrakant Atmaram  

Patel.   Plaintiff  no.  4,  after  having  executed  the  aforesaid

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documents in his individual capacity and after receipt of all the  

payments as per the aforesaid documents from the Mahalaxmi  

Society expired on 2.6.2006.  During his lifetime, he had not  

disputed  any  of  the  above  mentioned  documents  or  their  

contents.   The legal heirs of plaintiff No. 4, i.e. plaintiff Nos.  

1/1/A to 1/1/D had also not raised any dispute.  On the death of  

plaintiff  No. 4,  they also did not take any steps to get them  

impleaded as the heirs of plaintiff No. 4 in Special Civil Suit no.  

681 of 1992 or in Civil Suit No. 292 of 1993, consequently, on  

the expiry of the period of limitation, the suits stood abated,  

qua plaintiff No. 4.

32. We have found that pursuant to the execution of various  

documents,  referred  to  hereinbefore,  by  plaintiff  No.  1  -  

Chandrakant Atmaram Patel, for himself and on behalf of the  

other plaintiffs,  as well  as plaintiff  no. 1 individually,  plaintiff  

No.  2,  plaintiff  Nos.  5/1,  5/2,  5/3  and  5/4,  plaintiff  No.  4  

individually, and after having received the amounts mentioned  

therein  from the  appellant  –  Mahalaxmi  Society,  decided  to  

record  the  compromise  in  both  suits,  since  all  the  disputes  

between them were settled and they had acknowledged that  

Mahalaxmi Society is the full, legal, proper and absolute owner

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and possessor of the lands in question.   Consequently, plaintiff  

no. 1, on his behalf and on behalf of the other plaintiffs, except  

plaintiff  Nos.  3/1 and 3/2,  prepared a pursis dated 7.7.2008,  

referring to the sale deeds dated 08.06.1992 and 18.10.2000  

executed in favour of the Mahalaxmi Society in respect of all  

the  properties  in  question  stating  that  the  plaintiffs  have  

unconditionally given up all  the claims raised in the suit and  

have settled the issues with the Mahalaxmi Society.  The same  

was then presented before the trial Court.  Plaintiff Nos. 3/1 and  

3/2 and defendant No. 3 – Jankalyan Society, however endorsed  

their objection to the pursis on 31.07.2008.  Plaintiff No. 1 filed  

an affidavit on 13.8.2008 stating that the pursis was given in  

his individual capacity and as the power of attorney holder of  

plaintiff Nos. 2, 4 and 5.  The trial Court, after hearing plaintiff  

nos.  3/1,  3/2  and defendant  no.  3  (intervener),  came to the  

conclusion  that  plaintiff  Nos.  3/1  and  3/2  had  cancelled  the  

power  of  attorney only on 3.12.2004,  whereas the Deeds of  

Confirmation were executed prior thereto, and that defendant  

No. 3 claim rested only on an agreement to sell, and could not  

enjoy any right under the Transfer of Property Act and, thereby,  

allowed the pursis and disposed of the suit (Special Civil Suit

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no. 292 of 1993) on 14.8.2008.   Following that, Civil Suit No.  

681 of 1992 was also disposed of on 8.9.2009.

33. We may indicate that the documents referred to earlier,  

executed by the plaintiff No. 1 for himself and as a power of  

attorney  holder  for  others  and  the  acknowledgment  deed;  

Declaration-cum-indemnity  bonds,  deeds  of  confirmation  etc.  

executed by the plaintiff No.2, heirs of Baldev Prasad, plaintiff  

Nos. 5/1, 5/2, 5/3 and 5/4, plaintiff No. 4 etc. would clearly show  

that  they  had  received  large  amounts  from  the  Mahalaxmi  

Society and had acknowledged that the Mahalaxmi Society was  

the full, legal , proper and absolute owner and the possession  

of the property covered by the sale deeds dated 05.06.1992  

and  08.06.1992.    Plaintiff  Nos.  3/1  and  3/2,  though  later,  

challenged  the  judgment  and  order  dated  14.8.2008,  after  

more than one year,  while pending these appeals,  they also  

settled the matter with Mahalaxmi Society and accepted all the  

arguments raised by Mahalaxmi Society in this appeals.

34. Defendant No. 3 – Jankalyan Co-operative Group Housing  

Society  (present  intervener)  had  never  independently

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challenged  the  order  dated  14.8.208  of  the  trial  Court,  

consequently the order is binding on defendant No. 3.

35. We are now left with the objections raised by the heirs of  

the deceased plaintiff No. 4 and plaintiff Nos. 5/1 to 5/4.  The  

heirs of deceased plaintiff No. 4 and plaintiff Nos. 5/1, 5/2 and  

5/4 challenged the judgment and order dated 14.8.2008 only  

on 1.3.2010, more than one year and six months later, by filing  

Special  Civil  Application  no.  7087  of  2010.   The  documents  

referred to earlier clearly indicate that they had received large  

amounts from Mahalaxmi Society and the heirs of the deceased  

plaintiff no. 4 did not take any steps to get them recorded in  

the Civil Suit after the death of the plaintiff No. 4, so far as this  

case is concerned, the suit had abated.  The heirs of plaintiff  

No. 4 and plaintiff  Nos. 5/1,  5/2 and 5/4 also challenged the  

judgment  and  order  dated 8.9.2009  in  Civil  Suit  No.  681 of  

1992 only  on 1.3.2011 by filing Special  Civil  Application No.  

7088 of 2010.  Plaintiff No. 4, we have already indicated, was  

duly  represented  by  plaintiff  No.  1  –  Chandrakant  Atmaram  

Patel  while  executing  the  various  registered  documents  and  

issuing  Acknowledgement-cum-Settlement  Receipts  by  which  

large amounts were received by plaintiff  No.  1,  representing

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plaintiff  no.  4.  Over  and  above,  plaintiff  No.  4  himself  had  

executed  various  registered  deed  of  confirmation  dated  

5.1.2005 acknowledging the receipt of Rs.29,32,365/- and also  

Rs.30,05,527/-.   We  are  of  the  view  that  the  legal  heirs  of  

plaintiff  no.  4  now  cannot  come  forward  and  question  the  

various documents executed by plaintiff No. 4, especially when  

they had not taken any steps to get them impleaded in both  

the  civil  suits.   Impugned  orders  passed  on  14.8.2008  and  

8.9.2009, therefore, would bind them.   Plaintiff Nos. 5/1 to 5/4  

had also not objected to the execution of various deeds and  

documents ratified all  the actions taken by plaintiff  No.1,  as  

power of attorney holder, since they had not objected to the  

pursis dated 07.07.2008, and hence acquiesced to the order  

dated 14.08.2008.   

36.  We may now examine whether the impugned order would  

fall under Rule 3 of Order XXIII or Rule 1 of Order XXIII of the  

CPC, the said provisions are given below for easy reference:

ORDER XXIII. WITHDRAWAL AND ADJUSTMENT OF  SUITS

 1. Withdrawal of suit or abandonment of part of  claim

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(1)  At  any  time  after  the  institution  of  a  suit,  the  plaintiff may as against all or any of the defendants  abandon his suit or abandon a part of his claim:   Provided that where the plaintiff  is a minor or other  person to whom the provisions contained in rules 1 to  14 of Order XXXII extend, neither the suit nor any part  of the claim shall be abandoned without the leave of  the Court.   (2) An application for leave under the proviso to sub- rule (1) shall  be accompanied by an affidavit of the  next friend and also, if the minor or such other person  is  represented by a  pleader,  by  a  certificate of  the  pleader to the effect that the abandonment proposed  is, in his opinion, for the benefit of the minor or such  other person.   (3) Where the Court is satisfied,-   (a)  that  a  suit  must  fail  by  reason  of  some formal  defect, or (b) that there are sufficient grounds for allowing the  plaintiff to institute a fresh suit for the subject-matter  of a suit or part of a claim, it may, on such terms as it  thinks  fit,  grant  the plaintiff  permission to  withdraw  from such suit or such part of the claim with liberty to  institute a fresh suit in respect of the subject-matter of  such  suit  or  such  part  of  the  claim.  (4)  Where  the  plaintiff-   (a) abandons any suit or part of claim under sub-rule  (1), or   (b) withdraws from a suit or part of a claim without the  permission referred to in sub-rule (3),   he  shall  be  liable  for  such  costs  as  the  Court  may  award and shall be preclude from instituting any fresh  suit in respect of such subject-matter or such part of  the claim.

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 (5) Nothing in this rule shall be deemed to authorise  the  Court  to  permit  one  of  several  plaintiffs  to  abandon a suit or part of a claim under sub-rule (1), or  to withdraw, under sub-rule (3), any suit or part of a  claim, without the consent of the other plaintiffs.

“ORDER XXIII – WITHDRAWAL AND ADJUSTMENT OF  

SUITS-

(3) Compromise of suit.-  Where it is proved to  the satisfaction of the Court that a suit has been  adjusted wholly or in part by any lawful 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 suit.

Provided that where it is alleged by one party  and  denied  by  the  other  that  an  adjustment  or  satisfaction  has  been  arrived  at,  the  Court  shall  decide the question; but no adjournment shall  be  granted for  the purpose of deciding the question,  unless the Court, for reasons to be recorded, thinks  fit to grant such adjournment.

Explanation:-  An  agreement  or  compromise  which is void or voidable under the Indian Contract  Act, 1872 (9 of 1872), shall not be deemed to be  lawful within the meaning of this rule.”

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Rule  1  of  Order  XXIII  speaks  of  withdrawal  of  suit  or  

abandonment of part of claim.  Rule 1 of Order XXIII covers two  

types of cases (i) Where the plaintiff withdraws a suit or part of  

a claim with the permission of the Court to bring in fresh suit on  

the same subject matter and (ii) Where the plaintiff withdraws a  

suit without the permission of the Court.

Rule 3 of Order XXIII, on the other hand, speaks of compromise  

of  suit.   Rule  3  of  Order  XXIII  refers  to  distinct  classes  of  

compromise in suits.  The first part refers to lawful agreement  

or compromise arrived at by the parties out of court, which is  

under 1976 amendment of the CPC required to be in writing and  

signed by the parties.  The second part of Rule deals with the  

cases where the defendant satisfies the plaintiff in respect of  

whole or a part of the suit claim which is different from first part  

of Rule 3.  The expression ‘agreement’ or ‘compromise’ refer to  

first part and not the second part of Rule 3.  The second part  

gives emphasis to the expression ‘satisfaction’.   

37. In  Pushpa Devi V. Rajinder Singh,  (2006) 5 SCC 566,  

this  court  has  recognised  that  the  distinction  deals  with  the  

distinction between the first part and the second part.

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“What  is  the  difference  between  the  first  part  and  second part of Rule 3?  The first part refers to situations  where an agreement or compromise is entered into in  writing and signed by the parties.  The said agreement  or compromise is placed before the court.  When the  court is satisfied that the suit has been adjusted either  wholly or in part by such agreement, or compromise in  writing and signed by the parties and that it is lawful, a  decree follows in terms of what is agreed between the  parties.   The  agreement/compromise  spells  out  the  agreed  terms  by  which  the  claim  is  admitted  or  adjusted  by mutual  concessions or  promises,  so  that  the parties thereto can be held to their promise(s) in  future  and  performance  can  be  enforced  by  the  execution of the decree to be passed in terms of it.  On  the other hand, the second part refers to cases where  the defendant has satisfied the plaintiff about the claim.  This  may be by satisfying the plaintiff  that  his  claim  cannot be or need not be met or performed.  It can also  be by discharging or performing the required obligation.  Where  the  defendant  so  ‘satisfied’  the  plaintiff  in  respect  of  the  subject-matter  of  the  suit,  nothing  further remains to be done or enforced and there is no  question  of  any  ‘enforcement’  or  ‘execution’  of  the  decree to be passed in terms of it.”

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38-39. Further, it is relevant to note the word ‘satisfaction’  

has been used in contradistinction to the word ‘adjustment’ by  

agreement or compromise by the parties.  The requirement of  

‘in  writing  and signed by  the  parties’  does  not  apply  to  the  

second  part  where  the  defendant  satisfies  the  plaintiff  in  

respect of whole or part of the subject-matter of the suit.

40. The proviso to Rule 3 as inserted by the Amendment Act  

1976 enjoins the court to decide the question where one party  

alleges  that  the  matter  is  adjusted  by  an  agreement  or  

compromise  but  the  other  party  denies  the  allegation.   The  

court is, therefore, called upon to decide the lis one way or the  

other.   The proviso expressly and specifically states that the  

court  shall  not  grant  such  adjournment  for  deciding  the  

question  unless  it  thinks  fit  to  grant  such  adjournment  by  

recording reasons.

41. So far as the present case is concerned, pursis falls under  

Order  XXIII,  Rule  3  since  the  defendant  has  satisfied  the  

plaintiffs in respect of whole of the subject-matter of the suit.  

Since objections were raised by plaintiff No.3 and defendant No.  

3,  those  objections  had  to  be  dealt  with  by  the  court  in

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accordance with Order XXIII, Rule 3.  The proviso to Order XXIII,  

Rule 3 cast an obligation on the court to decide that question at  

the  earliest,  without  giving  undue  adjournments.   Objections  

raised by plaintiff No. 3 and defendant No.3 were examined by  

the court  and rejected,  in  our  view,  rightly.   Cogent reasons  

have been stated by the court while rejecting their objections  

and accepting the pursis.   

42. We have also found that the heirs of plaintiff No. 4 did not  

took steps to record themselves in Civil Suit No. 292/1993 till  

the same was disposed of and hence, as per the provisions of  

Articles 120 and 121 of the Limitation Act,  suit stood abated  

qua plaintiff No. 4.  No steps had been taken to set aside the  

abatement  as  well.   We  have  also  on  facts  found  that  the  

plaintiff No. 4 during his life time executed various documents  

acknowledging  the  amounts  paid  by  the  Mahalaxmi  Society.  

Plaintiff No. 3, though objected to pursis, later plaintiff Nos. 3/1  

and 3/2 have settled disputes and adopted the contention of the  

Mahalaxmi Society.

43. We are also not much impressed by the argument of the  

learned senior counsel appearing for the respondent that the

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trial  court  has  committed  an  error  in  not  consolidating  the  

various suits including Civil Suits No. 292/1993 and 681/1992 to  

be tried together as ordered by the District Court in its order  

dated  29.08.2006  in  Civil  Misc.  Application  No.  16/2005.  

Section 24 of the CPC only provides for transfer of any suit from  

one court to another.   The court has not passed an order of  

consolidating all the suits.  There is no specific provision in the  

CPC  for  consolidation  of  suits.   Such  a  power  has  to  be  

exercised only under Section 151 of the CPC.  The purpose of  

consolidation of suits is to save costs, time and effort and to  

make  the  conduct  of  several  actions  more  convenient  by  

treating them as one action.  Consolidation of suits is ordered  

for  meeting  the  ends  of  justice  as  it  saves  the  parties  from  

multiplicity of proceedings, delay and expenses and the parties  

are  relieved  of  the  need  of  adducing  the  same  or  similar  

documentary and oral evidence twice over in the two suits at  

two different trials.  Reference may be made to the judgment of  

this Court in Prem Lala Nahata and Anr. v. Chandi Prasad  

Sikaria  (2007) 2 SCC 551.

44. The transfer of the suits from one court to another to be  

tried  together  will  not  take  away  the  right  of  the  parties  to

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invoke Order XXIII Rule 3 and there is also no prohibition under  

Order  XXIII  Rule  3  or  Section  24  of  the  CPC  to  record  a  

compromise in one suit.  Suits always retain their independent  

identity and even after an order of consolidation, the court is  

not  powerless to  dispose of  any suit  independently  once the  

ingredients of Order XXIII, Rule 3 has been satisfied.

45. We are, therefore, of the view that so far as the instant  

case is concerned, there is no illegality in the orders passed by  

the trial court disposing of the suit under Order XXIII, Rule 3 of  

the CPC accepting the pursis dated 07.07.2008 and 18.09.2008.  

The  High  Court,  in  our  view,  was  not  right  in  upsetting  the  

orders dated 14.08.2008 and 08.09.2009 in Special  Civil  Suit  

Nos. 292/1993 and 681/1992.  Consequently, all these appeals  

are allowed and the common judgment of  the High Court  is,  

accordingly, set aside.  However, there will be no order as to  

costs.

………………………….J. (K.S. Radhakrishnan)

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………………………….J. (Dipak Misra)

New Delhi, March 1, 2013