Holding

A review petition is maintainable even after an SLP is dismissed as withdrawn, but the settlement must be in writing and the parties must have authorized the counsel; consequently the appeals were dismissed.

Summary

The appellants Bakshi Dev Raj & Anr. challenged a decree modified by the High Court in a second appeal, alleging that their counsel settled the matter without a written agreement and that the subsequent review petition was barred because their Special Leave Petition (SLP) had been dismissed as withdrawn. The Supreme Court examined the requirements of Order XXIII Rule 3 of the CPC that any compromise must be reduced to writing and signed, and affirmed that a review petition remains maintainable even after an SLP is dismissed without leave. It also held that a counsel, duly authorized by a vakalatnama, may settle or withdraw a case on behalf of the client, but the parties must have given clear instructions and the settlement must comply with statutory formalities. Since the appellants had not objected to their counsel’s actions and the settlement was not documented in writing, the Court found no merit in their claims and dismissed the appeals. The review petition was deemed maintainable in principle but was rejected on the facts.

Issues considered

Whether a review petition filed before the High Court against the judgment in the Second Appeal is maintainable after the Special Leave Petition has been dismissed as withdrawn without leave of the Court.
Whether a statement by counsel that the parties have settled and modified the decree without a written instrument or explicit consent from the parties is valid under Order XXIII Rule 3 of the CPC.
Whether dismissal of an SLP as withdrawn bars the filing of a review petition in the same matter.

Legislation cited

Code of Civil Procedure, 1908s. Order 23 Rule 1(1), s. Order 23 Rule 1(4), s. Order III Rule 1, s. Order III Rule 4, s. Order XLVII Rule 1(a), s. Order XXIII Rule 3
Constitution of Indias. Article 136, s. Article 141, s. Article 21
Indian Contract Act, 1872s. Section 23

Subjects

compromisesettlementwritten instrumentreview petitionspecial leave petitioncounsel authorityvakalatnamaCPCdoctrine of mergercivil procedure

Judgment

[2011] 9 S.C.R. 815

"
BAKSHI DEV RAJ & ANR. A
v.
SUDHIR KUMAR
(Civil Appeal Nos. 4641-4642 of 2009)

1 AUGUST 04, 2011
II B
[P. SATHASIVAM AND H.L. GOKHALE, JJ.]

Code of Civil Procedure, 1908:

Or. XX/II r. 3 - Compromise of suit - Requirement of - c
Held: During the course of hearing, namely, suit or appeal,
when the parties enter into a compromise, the same should
be reduced in writing in the form of an instrument and signed
by the parties.
.,
Or. XLVll r. 1(a) - Review Petition - Maintainability- SLP D
filed by the appellants against the Second Appeal -
Dismissal of, as withdrawn, without leave of the Court - Review
petition filed before the High Court against the judgment in
Second Appeal - Maintainability of - Held: Even after
dismissal of an SLP with or without reasons, the aggrieved E
1
party is entitled to file a review - In view of the language used
~
in Or. XLVll r. 1(a), the Review Petition cannot be dismissed
i on the ground of maintainability - Thus, the review petition
filed by the appellants was maintainable but in view of Or. Ill
r. 1 and 4, and in view of the conduct of the appellants in not F
raising any objection as to the act of their counsel except filing
review petition, the claim of the appellants cannot be
accepted.

Advocate/Counsel - Role of - In reporting about the G
,_j
settlement anived at - Extent and nature of authority to act
on behalf of client - Held: Terms appended in Vakalatnama
enable the counsel to perform several acts on behalf of his
client including withdrawal or compromise/settlement of suit
815 H
816 SUPREME COURT REPORTS [2011] 9 S.C.R.

A or matter pending before the Court - These clauses give •
power to the counsel to act with utmost interest - Counsel has
power to make a statement on instructions from the party to
withdraw the appeal - In such circumstance, the counsel
making a statement on instructions either for withdrawal of
B appeal or for modification of the decree is well within his r
competence and if really the counsel has not acted in tl1e '
interest of the party or against the instructions of the party, the
necessary remedy is elsewhere - On facts, there is no
material to substantiate the plea that the statement of the
c counsel before the High Court during the course of hearing
of Second Appeal was not based on any instructions - Even
otherwise, till filing of the review petition, the appellants did
not question the conduct of their counsel in making such
statement in the course of hearing of second appeal by writing
D
a letter or by sending notice disputing the stand taken by their
counsel - In absence thereof, it cannot be construed that the
.
counsel was debarred from making any statement on behalf
of the parties - In order to safeguard the present reputation
of the counsel and to uphold the prestige and dignity of legal
profession, it is always desirable to get instructions in writing.
E
The plot of respondent is on one side of the land of
appellant. The respondent filed a suit seeking declaration
of title and possession of the land and also sought •
decree for permanent injunction restraining the
F appellants in the suit land. The trial court dismissed the
· suit. The first appellate court allowed the appeal in favour
of the respondent. The appellants filed a Second Appeal.
The High Court framed two questions of law. During the
course of submissions, both the counsel agreed that
G without addressing the questions of law so formulated,
the matter could be settled by modifying the decree ....
impugned in appeal. Thereafter, the Second Appeal was
disposed of by the High Court by modifying the decree
with consent of both the parties. The appellant filed SLP
H and the same was dismissed as withdrawn. Thereafter,
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 817

"' the appellants filed a Review Petition before the High A
Court for review of the order passed in Second Appeal
and the same was dismissed. Aggrieved, the appellants
filed the instant appeal against the order passed by the
High Court in Second Appeal and in the Review Petition.
ct 8
• The questions which arose for consideration in these
appeals are whether Review Petition filed before the High
Court against the judgment in Second Appeal is
maintainable in view of dismissal of SLP filed against the
said Second Appeal; that whether the statement of the
counsel conveying that the parties have settled and
c
modified the decree without a written document or
consent from the appellants is acceptable; and that
)' whether dismissal of SLP as withdrawn without leave of
the CQurt to challenge the impugned order therein before
... an appropriate court/forum is a bar for availing such D
remedy.
Dismissing the appeals, the Court
HELD: 1.1 In terms of Order XXlll Rule 3 of the Code E
of Civil Procedure, 1908, agreement or compromise is to
be in writing and signed by the parties. During the course
of hearing, namely, suit or appeal, when the parties enter
" into a compromise, the same should be reduced in
writing in the form of an instrument and signed by the
F
parties. The Court must insist upon the parties to reduce
the terms into writing. [Paras 9 and 12] [828-D-E; 830-A-
B]
Gurpreet Singh vs. Chatur Bhuj Goel (1988) 1 SCC 270:
1988 (2) SCR 401; Pushpa Devi Bhagat (dead) through LR. G
.; Sadhna Rai (Smt.) vs. Rajinder Singh and Ors. (2006) 5 SCC
566: 2006 (3 ) Suppl. SCR 370 - referred to.
1.2 In the instant case, during the course of hearing
of second appeal, both counsel agreed that without
H
818 SUPREME COURT REPORTS (2011] 9 S.C.R.

A addressing the questions of law so formulated, the matter
can be settled by modifying the decree impugned in
appeal by incorporating the area of land under Survey
No. 110/65 with the boundary between the lands
thereunder and Survey No.109/65 belonging to the other •
B side being the Sheesham and Shreen trees currently
existing on the spot. [Para 11) [829-F-G]

2.1 The terms appended in Vakalatnama enable the
counsel to perform several acts on behalf of his client
C including withdraw or compromise suit or matter pending
before the Court. The various clauses in the Vakalatnama
undoubtedly gives power to the counsel to act with
utmost interest which includes to enter into a
compromise or settlement. [Para 12) [830-C-D]
D 2.2 The counsel who was duly authorized by a party
to appear by executing Vakalatnama and in terms of
Order Ill Rule 4, empowers the counsel to continue on
record until the proceedings in the suit are duly
terminated. The counsel, therefore, has power to make a
E statement on instructions from the party to withdraw the
appeal. In such circumstance, the counsel making a
statement on instructions either for withdrawal of appeal •
or for modification of the decree is well within his
competence and if really the counsel has not acted in the
F interest of the party or against the instructions of the
party, the necessary remedy is elsewhere. Though the
counsel for the appellant vehemently submitted that the
statement of the counsel before the High Court during the !Hf

course of hearing of Second Appeal was not based on
G any instructions, there is no such material to substantiate
the same. No doubt, the counsel for the appellant has
placed reliance on the fact that the first appellant was
bedridden and hospitalized, thus, he could not send any
instruction. According to him, the statement made before
the Court that too giving of certain rights cannot be
H sustained and beyond the power of the counsel. It is true
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 819

"' that at the relevant time, namely, when the counsel made A
a statement during the course of hearing of second
appeal one of the parties was ill and hospitalized./
However, it is not in dispute that his son who was also a
party before the High Court was very much available.
f
.. Even otherwise, it is not in dispute that till filing of the B
review petition, the appellants did not question the
conduct of their counsel in making such statement In the
course of hearing of second appeal by writing a letter or
by sending notice disputing the stand taken by their
counsel. In the absence of such recourse or material In c
the light of the provisions of the CPC, it cannot be
construed that the counsel is debarred from making any
statement on behalf of the parties. No doubt, in order to
safeguard the present reputation of the counsel and to
uphold the prestige and dignity of legal profession, it is
' D
'always desirable to get instructions in writing. [Para 15]
1
[833·F·H; 834-A·E] . ·

Byram Pestonji Gariwala vs.· Union Bank of India and Ors.
(1992) 1 SCC 31: 1991 (1) Suppl. SCR 187; Jineshwardas
(D) by LRs and Ors. vs. Jagrani (Smt) and Anr. (2003) 11 SCC E
372: 2003 (4) Suppl. SCR 179; Jagtar Singh vs.Pargat Singh
and Ors. (1996) 11 sec 586: 1996 (9) Suppl. SCR 252 -
relied on.

3. The High Court, based on the statement of both F
counsel disposed of Second Appeal by modifying 'the
decree. Against the said order of the High Court, the
appellants preferred the SLP before this Court. This Court
accepted the prayer made by the counsel for the
petitioner to withdraw the petition and dismissed the
G
_, special leave petition as withdrawn. A reading of the said
order makes it clear that based on the request of the
counsel, the SLP came to be dismissed as witl;ldrawn. It
is also clear that there is no permission or reservation or ·
liberty for taking further action. However, dismissal of SLP
H
..
820 SUPREME COURT REPORTS [2011] 9 S.C.R.

A is not a bar for filing review before the same Court. Even
after dismissal of SLP, the aggrieved parties are entitled
to move the court concerned by way of review. In the
instant case though the appellants moved an SLP in this
Court against the order of the High Court In Second
B Appeal, admittedly, the SLP was dismissed as withdrawn •
without the leave of the Court. [Paras 16 and 17] [834-G-
H; 835-B-C; 839-C-D]

Kunhayammed and Ors. vs. State of Kera/a and Anr.
(2000) 6 SCC 359: 2000 (1) Suppl. SCR 538; Sarguja
C Transport Service vs. State Transport Appellate Tribunal,
M.P. Gwalior and Ors. (1987) 1 SCC 5: 1987 (1) SCR 200 -
relied to.

4.1. Even after dismissal of an SLP with or without
D reasons, the aggrieved party is entitled to file a review.
In view of the language used in Order XLVll Rule 1(a) of
CPC which relates to "Review", the present Review
Petition cannot be dismissed on the ground of
maintainability. Thus, the review petition filed by the ..
E appellants was maintainable but in view of Order Ill Rules '
1 and 4, Chapter relating to the role of Pleaders, and in
view of the conduct of the appellants in not raising any
objection as to the act of their counsel except filing
review petition, the claim of the appellants cannot be
F accepted. [Para 19] [841-C-E]
4.2. It was contended by the appellant that by the
concession of their counsel, the appellants lost their
property and they suffered huge loss in terms of money.
On perusal of the modified decree as available in the
G order of the High Court in Second Appeal and the sketch
produced about the existence of Sheesham and Shreen
trees running as a demarcating line and whenever those
trees fall on either side the parties having ownership of
the land get right to use the same, the contention cannot
H be accepted. [Para 20] [841-F-G]
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 821

.. Case Law Reference: A·
1988 (2) SCR 401 Referred to Para 9

2006 (3 ) Suppl. SCR 370Referred to Para 10
1991 (1) Suppl. SCR 187 Relied on Para 12, 15
~
• B
2003 (4) Suppl. SCR 179 Relied on Para 13 ·

1996 (9) Suppl. SCR 252 Relied on Para 14

2000 (1) Suppl. SCR 538 Relied on Para 16
c
1987 (1) SCR 200 Referred to Para 18

CIVIL APPELLATE JURISDICTION : Civil Appeal No.
4641-4642 of 2009 .
•
-; From the Judgment & Order dated 18.03.2008 &
08.09.2008 of the High Court of Jammu & Kashmir at Jammu
in Civil Seco.nd Appeal No. 19 of 2005 & Review P~tition No.
(C) D-5 of 2008.

Dinesh Kumar Garg, B.J. Billowria, Dr. Bheem Pratap
E
Singh, Abhishek Garg for the Appellants.

Ranjeet Kumar, Sameer Parekh, Carmichael Martin, Sumit
}
' Goel, Debojyoti Bhattacharya, Parekh & Co. for the
Respondent
F
The Judgment of the Court was delivered by

P.SATHASIVAM,J. 1. These appeals are directed against
the final judgment and orders dated 18.03.2008 and
08.09.2008 passed by the High Court of Jammu & Kashmir at
Jammu in Civil Second Appeal No. 19 of 2005 and Review G
....... Petition (C) No. D-5 of 2008 respectively whereby the High
•·
Court dismissed the second appeal and the review petition filed
by the appellants herein.

2. Brief facts: H
822 SUPREME COURT REPORTS [2011] 9 S.C.R.

A (a) Shri Harbans Lal, father of the appellant No.1,
purchased the land in dispute measuring 40 kanal 4 marlas
bearing Khasra No. 65 in Village Chak Gainda, Tehsil Kathua
from one Gurdas by way of a registered sale deed dated
18.03.1959. The said land falls in Khasra No. 109/65 and the
8 same was recorded in the name of the father of the appellant
No.1 and after his father's death the name of appellant No.1 •
was recorded from Kharif 1987.
'
(b) The plot of Sudhir Kumar-the respondent herein is on
the southern side of the land of the appellants. On 29;04.1991,
c the respondent herein filed a civil suit being No. 17/Civil/1991 t

in the Court of sub-Judge, Kathua seeking a declaratory decree
to the effect that he is the owner and in possession of the suit
land measuring and bounded by East Kathua Kalibari Road 90'
West Police Line measuring 96', North Land of Bakshi Dev Raj
D (appellant No. 1 herein} and South, Lane 460' situated at Ward .
No.1 Village Chak Gainda, Tehsil Kathua and further sought
decree for permanent injunction restraining the appellants
herein in the suit land. On 06.04.1993, the appellants herein filed
a joint written statement in the above civil suit. The trial Court,
E vide judgment dated 25.04.2003, dismissed the suit filed by the
respondent herein.
(c} Aggrieved by the said judgment, the respondent filed
Civil First Appeal No.6 in the Court of District & Sessions ~

F Judge, Kathua. The first appellate Court, vide judgment and
decree dated 09.06.2005, set aside the judgment and order
dated 25.04.2003, passed by the trial Court and allowed the
appeal in favour of the respondent.
(d} Challenging the same, the appellants filed Second
G Appeal No. 19 of 2005 before the High Court of Jammu &
Kashmir at Jammu. Vide judgment dated 18.03.2008, the
second appeal was disposed of by the High Court by modifying
the decrae with the consent of both the parties.
-
H (e} Against the said order, a special leave petition bearing
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 823
,. [P. SATHASIVAM, J.]
S.L.P. (C) No. 10939 of2008 was filed by the appellants herein A
before this Court and the same was dismissed as withdrawn
on 14.05.2008. On 21.05.2008, the appellants filed a review
petition being Review Petition (C) No. D-5/2008 before the High
)•
t Court for review of the order dated 18.03.2008 passed in
Second Appeal. The learned single Judge of the High Court, B
by order dated 08.09.2008, dismissed the review petition filed
by the appellants.

(f) Aggrieved by the final orders dated 18.03.2008 passed
' by the High Court in Second Appeal and the order dated
c
08.09.2008 in the review petition, the appellants filed the
present appeals before this Court by way of special leave
., petitions .
_,
. 3. Heard Mr. Dinesh Kumar Garg, learned counsel for the
appellants and Mr. Ranjit Kumar, learned senior counsel D
appearing for the respondent.
4. The questions which arise for consideration in these
appeals are:
(i) Whether Review Petition (C) No. D-5/2008 filed E
·~
before the High Court against the judgment in
) Second Appeal No. 19 of 2005 is maintainable in
view of dismissal of SLP (C) No. 10939 of 2008
dated 14.05.2008 by this Court filed against the
said Second Appeal? F
(ii) Whether the statement of the counsel conveying that
the parties have settled and modified the decree
without a written document or consent from the
..... appellants is acceptable? and G
(iii) Whether dismissal of SLP as withdrawn without
leave of the Court to challenge the impugned order
therein before an appropriate court/forum is a bar
for availing such remedy?
,., H
824 SUPREME COURT REPORTS (2011] 9 S.C.R.

A 5. The present appellants filed Second Appeal No. 19 of
2005 before the High Court questioning the judgment and
decree dated 09.06.2005 of the first appellate Court in First
Appeal No.6. While admitting the above second appeal, the
High Court framed two questions of law, one, as to whether the •
B report of the Commissioner is admissible evidence without its
formal proof and the other, whether the reliance can be placed
on a site plan prepared by an Architect when the same record
is available with the Revenue Authorities which has been
withheld by the plaintiff. It is further seen from the order of the r
High Court that during the course of submissions, both the
c counsel agreed that without addressing the questions of law so
formulated, the matter can be settled by modifying the decree
impugned in appeal by incorporating the area of land under
Survey No. 110/65 with the boundary between the lands ,_
thereunder and Survey No. 109/65 belonging to other side
D p
being the Sheesham and Shreen trees currently existing on the
spot. They further conceded that whatever of their respective
land falling on either side would not be claimed by them and
the Sheesham and Shreen trees would be respondent's
property to be cut by him within a reasonable period of time.
E Based on the above submissions by both the counsel, the High
Court modified the impugned decree in the following manner:

"(a) The suit of respondent/plaintiff is decreed restraining
other side from interfering or causing any interference or
F encroaching upon any portion of his land measuring 11
kanals 12 marlas under survey No 110/65 along with his
other proprietary land whatever existing on spot.
(b) The sheesham and shreen trees existing on spot would
G
be the boundary line between two parcels of land belonging
to rival sides as aforementioned with the exact
.....
demarcating line running 1rom centre of trees, which would
be property of respondent/plaintiff to be cut by him at an
appropriate time without undue delay.
H (c) Whenever proprietary land of either parties falls on
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 825
[P. SATHASIVAM, J.]
~

other side of the trees to form part of Opposite Party land A
stands conceded to each other by respective parties over
which their claims would be deemed to have been
abandoned.

~
> (d) No costs." .B
6. By pointing out that the concession given by the counsel
for the appellants before the High Court was not lawful and in
violation of Section 23 of the Indian Contract Act, 1872 and that
the second appeal was disposed of without hearing on
substantial questions of law framed by the Court, the appellants c
filed Review Petition (C) No. No.D-5/2008. Even before the
High Court, an objection was raised as to the maintainability
of the review petition by pointing out the following objections:
"'
A
"(a) that once the petitioner had preferred an appeal before D
the Supreme Court, the review was barred under 0. 47
Rule 1 Sub-Rule (1) of C.P.C.
(b) that application is time barred, period of limitation
prescribed for filing review in terms of Rule 66 Sub Rule
(3) of J&K High Court Rules is 30 days. E

(c) that review application can be maintained only if some
' evidence or matter has been discovered and it was not
within the knowledge of petitioner when the decree was
passed or where there was a mistake or an error apparent F
on the fact of record."
7. In view of the above objections, the learned single Judge
heard the review petition both on merits and its maintainability
at length. A contention was raised with reference to Order XXlll
• Rule 3 of the Code of Civil Procedure, 1908 (hereinafter
G
referred to as "CPC") and Order XLVll sub-rule (1) of Rule 1, _
ultimately, after finding that the question raised is not a question
of law and not an error apparent on the face of the record,
dismissed the review petition. In the present appeal, the
H
826 SUPREME COURT REPORTS [2011] 9 S.C.R.

A appellants challenged not only the dismissal of the review
petition but also final judgment in second appeal filed before
the High Court. With these factual details, let us consider the
questions posed in the earlier paragraphs. Inasmuch as Mr.
Ranjit Kumar, learned senior counsel for the respondent raised •
B an objection as to the maintainability of the present appeal, let
us consider the same at the foremost and finally the merits of
the impugned order of the High Court.

Compromise of Suit
c 8. Order XXlll of CPC deals with "Withdrawal and
Adjustment of Suits". Rule 3 of Order XXlll speaks about
"compromise of suit" which reads as under:

"3. Compromise of suit.- Where it is proved to the ..
D 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,
E
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:
F 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

G
the question, unless the Court, for reasons to be recorded,
thinks fit to grant such adjournment.
Explanation-An agreem&nt 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.·
H
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 827
-~
[P~ SATHASIVAM, J.]

9. The very same rule was considered by this Court in A
Gurpreet Singh vs. Chatur Bhuj Goel, (1988) 1 SCC 270. In
that case, the respondent therein Chatur Bhuj Goel, a practising
advocate at Chandigarh first lodged a criminal complaint
,,} against Colonel Sukhdev Singh, father of the appellant, under
Section 420 of the Indian Penal Code 1860 (hereinafter B
referred to as "the IPC"), after he had served the respondent
with a notice dated 11.07 .1979 forfeiting the amount of
Rs.40,0001- paid by him by way of earnest money, alleging that
he was in breach of the contract dated 04.06.1979 entered into
between Colonel Sukhdev Singh, acting as guardian of the c
appellant, then a minor, and the respondent, for the sale of
residential house No. 1577, Sector-18-D, Chandigarh for a
1 consideration of Rs,2,85,000/-. In terms of the agreement, the
,,, respondent was to pay a further sum of Rs.1,35,000/- to the
appellant's father- Colonel Sukhdev Singh by 10.07.1979 when
D
the said agreement of sale was to be registered and vacant
possession of the house delivered to him, and the balance
amount of Rs.1,10,000/- on or before 31.01.1980 when the
deed of convey;mce was to be executed. The dispute between
the parties was that according to Colonel Sukhdev Singh, there
was failure on the part of the respondent to pay the amount of E
Rs.1,35,000/- and get the agreement registered, while the
.. respondent alleged that he had already purchased a bank draft
)
in the name of the appellant for Rs.1,35,000/- on 07.07.1979
but the appellant's father did not turn up to receive the same.
Although the Additional Chief Judicial Magistrate by order dated F
31.10.1979 dismissed the complaint holding that the dispute
was of a civil nature and no process could issue on the
complaint, the learned Single· Judge, by his order dated
11.02 .1980 set aside the order of the learned Additional Chief
.. Judicial Magistrate holding that the facts brought out clearly G
warranted an inference of dishonest intention on the part of
Colonel Sukhdev Singh and accordingly directed him to
proceed with the trial according to law. Aggrieved Colonel
Sukhdev Singh came up in appeal to this Court by way of
H
828 SUPREME COURT REPORTS (2011) 9 S.C.R.

A special leave. While construing Order XXlll Rule 3 of CPC, this
Court concluded thus:

"10. Under Rule 3 as it now stands, when a claim in suit
has been adjusted wholly or in part by any lawful agreement
~
or compromise, the compromise must be in writing and
B
signed by the parties and there must be a completed
agreement between them. To constitute an adjustment, the
agreement or compromise must itself be capable of being
embodied in a decree. When the parties enter into a
compromise during the hearing of a suit or appeal, there
c is no reason why the requirement that the compromise
should be reduced in writing in the form of an instrument
signed by the parties should be dispensed with. The court
must therefore insist upon the parties to reduce the terms
into writing." "'
D
It is clear from this decision that dL.ring the course of hearing,
namely, suit or appeal, when the parties enter into a
compromise, the same should be reduced in writing in the form
of an instrument and signed by the 'parties. The substance of
E the said decision is that the Court must insist upon the parties
to reduce the terms into writing.

10. In Pushpa Devi Bhagat (dead) through LR. Sadhna
Rai (Smt.) vs. Rajinder Singh and Others, (2006) 5 SCC 566,
the term 'instrument' used in above-referred Gurpreet Singh's
F case (supra} refers to a writing a formal nature, this Court
explained that when the hearing of letters patent appeal
commenced before the High Court, the parties took time to
explore the possibility of settlement and when the hearing was
resumed, the appellant's father made an offer for settlement
G which was endorsed by the counsel for the appellant also. The
respondent was also present there and made a statement
accepting the offer. The said offer and acceptance were not
-
treated as final as the appeal was not disposed of by recording
those terms. On the other hand, the said proposals were
H recorded and the matter was adjourned for payment in terms
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 829
[P. SATHASIVAM, J.]

of the offer. When the matter was taken up on the next date of A
hearing, the respondent stated that he is not agreeable. The
High Court directed that the appeal would now be heard on
merits as the respondent was not prepared to abide by the
'I' proposed compromise. The said order was challenged before
t
this Court by the appellant by contending that the matter was B
settled by a lawful compromise by recording the statement by
appellant's counsel and the respondent's counsel and the
respondent could not resile from such compromise and,
therefore, the High Court ought to have disposed of the appeal
in terms of the compromise. It is in this factual background, the c
question was considered with reference to Gurpreet Singh's
case (supra). This was explained in Pushpadevi's case (supra)
that the distinguishing feature in that case was that though the
' submissions made were recorded but that were not signed by
-~
the parties or their counsel, nor did the Court treat the D
submissions as a compromise. In Pushpadevi's case (supra),
the Court not only recorded the terms of settlement but
thereafter directed that the statements of the counsel be
recorded. The statement of the counsel were also recorded on
oath read over and accepted by the counsel to be correct and
E
then signed by both counsel. In view of the same, in
Pushpadevi's case (supra), it was concluded that there was a
)
• valid compromise in writing signed by the parties (represented
counsel).
11. In the earlier part of our order, we have already F
recorded that during the course of hearing of second appeal,
both counsel agreed that without addressing the questions of
law so formulated, the matter can be settled by modifying the
decree impugned in appeal by incorporating the area of land
.-j under Survey No. 110/65 with the boundary between the lands G
thereunder and Survey No.109/65 belonging to the other side
being the Sheesham and Shreen trees currently existing on the
spot.

H
830 SUPREME COURT REPORTS [2011] 9 S.C.R.
t

A Role of the counsel
12. Now, we have to consider the role of the counsel
reporting to the Court about the settlement arrived at. We have
already noted that in terms of Order XXlll Rule 3 of CPC, ..
agreement or compromise is to be in writing and signed by the
B parties. The impact of the above provision and the role of the
counsel has been elaborately dealt with by this Court in Byram
Pestonji Gariwala vs. Union Bank of India and Others, (1992)
1 sec 31 and observed that courts in India have consistently
recognized the traditional role of lawyers and the extent and
c nature of implied authority to act on behalf of their clients. Mr.
Ranjit Kumar, has drawn our attention to the copy of
Vakalatnama (Annexure-R3) and the contents therein. The •
terms appended in Vakalatnama enable the counsel to perform
several acts on behalf of his client including withdraw or •
D compromise suit or matter pending before the Court. The
various clauses in the Vakalatnama undoubtedly gives power
to the counsel to act with utmost interest which includes to enter
into a compromise or settlement. The following observations
and conclusions in paras 37, 38 and 39 are relevant:
E "37. We may, however, hasten to add that it will be prudent
for counsel not to act on implied authority except when
•
warranted by the exigency of circumstances demanding
immediate adjustment of suit by agreement or compromise
and the signature of the party cannot be obtained without
F undue delay. ln·these days of easier and quicker
communication, such contingency may seldom arise. A
wise and careful counsel will no doubt arm himself in
advance with the necessary authority expressed in writing

G
to meet all such contingencies in order that neither his
authority nor integrity is ever doubted. This essential
precaution will safeguard the personal reputation of
counsel as well as uphold the prestige and dignity of the
-
legal profession.
38. Considering the traditionally recognised role of counsel
H in the common law system, and the evil sought to be
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 831
[P. SATHASIVAM, J.]

remedied by Parliament by the C.P.C. (Amendment) Act, A
1976, namely, attainment of certainty and expeditious
disposal of cases by reducing the terms of compromise
to writing signed by the parties, and allowing the
compromise decree to comprehend even matters falling
outside the subject matter of the suit, but relating to the B
parties, the legislature cannot, in the absence of express
words to such effect, be presumed to have disallowed the
parties to enter into a compromise by counsel in their
cause or by their du!y authorised agents. Any such
presumption would be inconsistent with the legislative c
object of attaining quick reduction of arrears in court by
elimination of uncertainties and enlargement of the scope
of compromise.

39. To insist upon the party himself personally signing the
agreement or compromise would often eause undue delay, D
loss and inconvenience, especially in the case of non-
resident persons. It has always been universally understood
that a party can always act by his duly authorised
-I representative. If a power-of-attorney holder can enter into
an agreement or compromise on behalf of his principal, E
-· so can counsel, possessed of the requisite authorisation
by vakalatnama, act on behalf of his client. Not to
recognise such capacity is not only to cause much
)
inconvenience and loss to the parties personally, but also
to delay the progress of proceedings in court. If the F
legislature had intended to make such a fundamental
1 change, even at the risk of delay, inconvenience and
•""' needless expenditure, it would have expressly so stated."

~
13. In Jineshwardas (D) by LRs and Others vs. Jagrani G
(Smt) and Another, (2003) 11 SCC 372, this Court, by
.....
approving the decision taken in Byram Pestonji's case (supra),
held that a judgment or decree passed as a result of consensus
arrived at before Court, cannot always be said to be one
bassed on compromise or settlement and adjustment. It may, u
832 SUPREME COURT REPORTS [2011] 9 S.C.R.

A at times, be also a judgment on admission.

14. In Jagtar Singh vs. Pargat Singh and Others, (1996)
11 sec 586, it was held that counsel for the appellant has
power to make a statement on instructions from the party to
withdraw the appeal. In that case, respondent No.1 therein, elder
8
brother of the petitioner filed a suit for declaration against the
petitioner and three brothers that the decree dated 04.05.1990
was null and void which was decreed by subordinate Judge,
Hoshiarpur on 29.09.1993. The petitioner therein filed an
C appeal in the Court of Additional Distruct Judge, Hoshiarpur.
The counsel made a statement on 15.09.1995 that the
petitioner did not intend to proceed with the appeal. On the
basis thereof, the appeal was dismissed as withdrawn. The
petitioner challenged the order of the appellate court in the
revision. The High Court confirmed the same which
D necessitated filing-of SLP before this Court. Learned counsel ..
for the petitioner contended that the petitioner had not
authorized the counsel to withdraw the appeal. It was further
contended that the court after admitting the appeal has no
power to dismiss the same as withdrawn except to decide the
E matter on merits considering the legality of the reasoning of the
trial Court and the conclusions either agreeing or disagreeing
with it. Rejecting the said contention, the Court held as under:
"3. The learned counsel for the petitioner has contended
F that the petitioner had not authorised the counsel to
withdraw the appeal. The Court after admitting the appeal
has no power to dismiss the same as withdrawn except
to decide the matter on merits considering the legality of
the reasoning of the trial court and the conclusio'ns either
agreeing or disagreeing with it. We find no force in the
G
contention. Order Ill Rule 4 CPC empowers the counsel to
continue on record until the proceedings in the suit are duly
terminated. The counsel, therefore, has power to make a
statement on instructions from the party to withdraw the
appeal. The question then is whether the court is required
H
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 833
[P. SATHASIVAM, J.]
., to pass a reasoned order on merits against the decree A
appealed from the decision of the Court of the Subordinate
Judge? Order 23 Rules 1(1) and (4) give power to the
party to abandon the claim filed in the suit wholly or in part.
By operation of Section 107(2) of the CPC, it equally
~ applies to the appeal and the appellate court has co- B
f
extensive power to permit the appellant to give up his
appeal against the respondent either as a whole or part
of the relief. As a consequence, though the appeal was
admitted under Order 41 Rule 9, necessarily the Col.'rt has
the power to dismiss the appeal as withdrawn without c
going into the merits of the matter and deciding it under
Rule 11 thereof.
4. Accordingly, we hold that the action taken by the counsel
is consistent with the power he had under Order Ill Rule 4
, >- D
CPC. If really the counsel has not acted in the interest of
the party or against the instructions of the party, the
necessary remedy is elsewhere an~ the procedure
adopted by the court below is consistent with the
provisions of CPC. We do not find any illegality in the order
passed by the Additional District Judge as confirmed by E
the High Court in the revision."

• 15. The analysis of the above decisions make it clear that
)
the counsel who was duly authorized by a party to appear by
executing Vakalatnama and in terms of Order Ill Rule 4, F
empowers the counsel to continue on record until the
proceedings in the suit are duly terminated. The counsel,
therefore, has power to make a statement on instructions from
the party to withdraw the appeal. In such circumstance, the
counsel making a statement on instructions either for withdrawal G
~
of appeal or for modification of the decree is well within his
competence and if really the counsel has not acted in the
interest of the party or against the instructions of the party, the
necessary remedy is elsewhere. Though learned counsel for the
appellant vehemently submitted that the statement of the
H
834 SUPREME COURT REPORTS [2011) 9 S.C.R.

A counsel before the High Court during the course of hearing of
Second Appeal No. 19. of 2005 was not based on any
instructions, there is no such material to substantiate the same.
No doubt, Mr. Garg has placed reliance on the fact that the first
appellant was bedridden and hospitalized, hence, he could not
B send any instruction. According to him, the statement made
before the Court that too giving of certain rights cannot be
sustained and beyond the power of the counsel. It is true that
at the relevant time, namely, when the counsel made a
statement during the course of hearing of second appeal one
c of the parties was ill and hospitalized. However, it is not in
dispute that his son who was also a party before the High Court
was very much available. Even otherwise, it is not in dispute
that till filing of the review petition, the appellants did not question
the conduct of their counsel in making such statement in the
course of hearing of second appeal by writing a letter or by
0
sending notice disputing the stand taken by their counsel. In the
absence of such recourse or material in the light of the
provisions of the CPC as discussed and interpreted by this
Court, it cannot be construed that the counsel is debarred from
making any statement on behalf of the parties. No doubt, as
E pointed out in Byram Pestonji (supra), in order to safeguard
the present reputation of the counsel and to uphold the prestige
and dignity of legal profession, it is always desirable to get
instructions in writing.
F Maintainability of Review Petition
16. Now, let us consider the maintainability of the review
petition filed before the High Court after dismissal of SLP (C}
No. 10939 of 2008 before this Court. It is not in dispute that
G the High Court, by order dated 18.03.2008, based on the
statement of both counsel disposed of Second Appeal No. 19
of 2005 by modifying the decree as stated therein. Against the
..
said order of the High Court, the appellants preferred the above
said SLP before this Court. By order dated 14.05.2008, this
H Court after hearing the counsel for the appellants passed the
following order:
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 835
[P. SATHASIVAM, J.]
"Learned counsel for the petitioner prays to withdraw the A
"!
petition. Prayer made is accepted. The special leave
petition is dismissed as withdrawn"

A reading of the above order makes it clear that based on the
request of the counsel, the SLP came to be dismissed as B
j withdrawn. It is also clear that there is no permission or
r reservation or liberty for taking further action. However,
dismissal of SLP is not a bar for filing review before the same
Court. This aspect was considered by a three-Judge Bench of
this Court in Kunhayammed and Others vs. State of Kera/a
and Another, (2000) 6 sec 359. The above aspect was dealt
c
with elaborately in paras 38, 40 and 44.

"38. The review can be filed even after SLP is dismissed
is clear from the language of Order 47 Rule 1(a). Thus the
words "no appeal" has been preferred in Order 47 Rule D
~
1(a) would also mean a situation where special leave is
not granted. Till then there is no appeal in the eye of law
before the superior court. Therefore, the review can be
preferred in the High Court before special leave is granted,
but not after it is granted. The reason is obvious. Once E
special leave is granted the jurisdiction to consider the
validity of the High Court's order vests in the Supreme
Court and the High Court cannot entertain a review
thereafter, unless such a review application was preferred
in the High Court before special leave was granted. F
40. A petition seeking grant of special leave to appeal may
be rejected for several reasons. For example, it may be
rejected (i) as barred by time, or (ii) being a defective
presentation, (iii) the petitioner having no locus standi to
file the petition, {iv) the conduct of the petitioner disentitling G
__, him to any indulgence by the court, {iv) the question raised
by the petitioner for consideration by this Court being not
fit for consideration or deserving being dealt with by the
Apex Court of the country and so on. The expression often
employed by this Court while disposing of such petitions H
836 SUPREME COURT REPORTS [2011] 9 S.C.R.

A are- "heard and dismissed", "dismissed", "dismissed as
barred by time" and so on. May be that at the admission
stage itself the opposite party appears on caveat or on
notice and offers contest to the maintainability of the
petition. The Court may apply its mind to the
B meritworthiness of the petitioner's prayer seeking leave to
file an appeal and having formed an opinion may say
"dismissed on merits". Such an order may be passed even
ex parte, that is, in the absence of the opposite party. In
any case, the dismissal would remain a dismissal by a non-
c speaking order where no reasons have been assigned and
no law has been declared by the Supreme Court. The
dismissal is not of the appeal but of the special leave
petition. Even if the merits have been gone into, they are
the merits of the special leave petition only. In our opinion
neither doctrine of merger nor Article 141 of the
D
Constitution is attracted to such an order. Grounds entitling
exercise of review jurisdiction conferred by Order 47 Rule
1 CPC or any other statutory provision or allowing review
of an order passed in exercise of writ or supervisory
jurisdiction of the High Court (where also the principles
E underlying or emerging from Order 47 Rule 1 CPC act as
guidelines) are not necessarily the same on which this
Court exercises discretion to grant or not to grant special
leave to appeal while disposing of a petition for the
purpose. Mere rejection of a special leave petition does
F not take away the jurisdiction of the court, tribunal or forum
whose order forms the subject-matter of petition for special
leave to review its own order if grounds for exercise of
review jurisdiction are shown to exist. Where the order
rejecting an SLP is a speaking order, that is, where
G reasons have been assigned by this Court for rejecting the
petition for special leave and are stated in the order still
the order remains the one rejecting prayer for the grant of
leave to appeal. The petitioner has been turned away at
the threshold without having been allowed to enter in the
H appellate jurisdiction of this Court. Here also the doctrine
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 837
[P. SATHASIVAM, J.]
.:.,
A
of merger would not apply. But the law stated or declared
by this Court in its order shall attract applicability of Article
141 of the Constitution.

The reasons assigned by this Court in its order
• expressing its adjudication (expressly. or by necessary B
~
implication) on point of fact or law shall take away the
jurisdiction of any other court, tribunal or authority to
express any opinion in conflict with or in departure from
the view taken by this Court because permitting to do so
would be subversive of judicial discipline and an affront to c
the order of this Court. However this would be so not by
reference to the doctrine of merger.

44. To sum up, our conclusions are:
;, (i) Where an appeal or revision is provided against an D
order passed by a court, tribunal or any other authority
before superior forum and such superior forum modifies,
reverses or affirms the decision put in issue before it, the
decision by the subordinate forum merges in the decision
by the superior forum and it is the latter which subsists, E
remains operative and is capable of enforcement in the
eye of law.
' (ii) The jurisdiction conferred by Article 136 of the
Constitution is divisible into two stages. The first stage is F
upto the disposal of prayer for special leave to file an
appeal. The second stage commences if and when the
leave to appeal is granted and the special leave petition
is converted into an appeal.
(iii) The doctrine of merger is not a doctrine of universal G
_,I
or unlimited application. It will depend on the nature of
jurisdiction exercised by the superior forum and the content
or subject-matter of challenge laid or capable of being laid
shall be determinative of the applicability of merger. The
superior jurisdiction should be capable of reversing, H
838 SUPREME COURT REPORTS [2011] 9 S.C.R.

A modifying or affirming the order put in issue before it.
Under Article 136 of the Constitution the Supreme Court
may reverse, modify or affirm the judgment-decree or order
appealed against while exercising its appellate jurisdiction
and not while exercising the discretionary jurisdiction
B disposing of petition for special leave to appeal. The
doctrine of merger can therefore be applied to the former
and not to the latter.

(iv) An order refusing special leave to appeal may be a
non-speaking order or a speaking one. In either case it
c does not attract the doctrine of merger. An order refusing
special leave to appeal does not stand substituted in place
of the order under challenge. All that it means is that the
Court was not inclined to exercise its discretion so as to
allow the appeal being filed.
D
(v) If the order refusing leave to appeal is a speaking order,
i.e., gives reasons for refusing the grant of leave, then the
order has two implications. Firstly, the statement of law
contained in the order is a declaration of law by the
E Supreme Court within the meaning of Article 141 of the
Constitution. Secondly, other than the declaration of law,
whatever is stated in the order are the findings recorded
by the Supreme Court which would bind the parties thereto
and also the court, tribunal or authority in any proceedings
F subsequent thereto by way of judicial discipline, the
Supreme Court being the Apex Court of the country. But, ·
this does not amount to saying that the order of the court,
tribunal or authority below has stood merged in the order
of the Supreme Court rejecting the special leave petition
G
or that the order of the Supreme Court is the only order
binding as res judicata in subsequent proceedings
between the parties.
(vi) Once leave to appeal has been granted and appellate
jurisdiction of Supreme Court has been invoked the order
H
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 839
[P. SATHASIVAM, J.]

passed in appeal would attract the doctrine of merger; the A
order may be of reversal, modification or merely
affirmation.

>
, ¥ (vii) On an appeal having been preferred or a petition
seeking leave to appeal having been converted into an
B
appeal before the Supreme Court the jurisdiction of High
Court to entertain a review petition is lost thereafter as
provided by sub-rule (1) of Rule 1 of Order 47 CPC."

17. In view of the principle laid down above by this Court,
even after dismissal of SLP, the aggrieved parties are entitled c
to move the court concerned by way of review. In the case on
hand, though the appellants moved an SLP in this Court against
f.
the order of the High Court in Second Appeal, admittedly, the
SLP was dismissed as withdrawn without the leave of the
Court. D
18. Similar question was considered by this Court in
Sarguja Transport Service vs. State Transport Appellate
Tribunal, M.P., Gwalior, and Others, (1987) 1 SCC 5. In this
decision it was held that where a petitioner withdraws a petition
E
filed by him in the High Court under Article 226/227 without
permission to institute a fresh petition, remedy under Article
226/227 should be deemed to have been abandoned by the
petitioner in respect of the cause of action relied on in the writ
petition and it would not be open to him to file a fresh petition
in the High Court under the same article though other remedies F
like suit or writ petition before the this Court under Article 32
would remain open to him. It was further held that the principle
underlying Rule 1 of Order XXlll of CPC should be extended in
_. the interests of administration of justice to cases of withdrawal
~
of writ petition also. The main contention urged by the learned G
counsel for the petitioner in that case was that th~ High Court
was in error in rejecting the writ petition on the ground that the
petitioner had withdrawn the earlier writ petition in which he had
questioned the order passed by the Tribunal on 04.10.1985
without the permission of the High Court to file a fresh petition. H
840 SUPREME COURT REPORTS [2011) 9 S.C.R.
.
A It was urged by the learned counsel that since the High Court
had not decided the earlier petition on merits but only had
permitted the petitioner to withdraw the petition, the withdrawal
of the said earlier petition could not have been treated as a bar
to the subsequent writ petition. While considering the said
B :question, this Court considered sub-rule 3 of Rule 1 of Order "
23 CPC and its applicability to writ petitions filed under Article
226/227 and held as under:

"9. The point for consideration is whether a petitioner after
withdrawing a writ petition filed by him in the High Court
c under Article 226 of the Constitution of India without the
permission to institute a fresh petition can file a fresh writ
petition in the High Court under that article. On this point
the decision in Daryao case is of no assistance. But we
....
are of the view that the principle underlying Rule 1 of Order
D XXlll of the Code should be extended in the interests of
administration of justice to cases of withdrawal of writ
petition also, not on the ground of res judicata but on the
ground of public policy as explained above. It would also
discourage the litigant from indulging in bench-hunting
E tactics. In any event there is no justifiable reason in such
a case to permit a petitioner to invoke the extraordinary
jurisdiction of the High Court under Article 226 of the
Constitution once again. While the withdrawal of a writ
petition filed in a High Court without permission to file a
F fresh writ petition may not bar other remedies like a suit
or a petition under Article 32 of the Constitution of India
since such withdrawal does not amount to res judicata, the
remedy under Article 226 of the Constitution of India
should be deemed to have been abandoned by the
petitioner in respect of the cause of action relied on in the ......
G
writ petition when he withdraws it without such permission.
In the instant case the High Court was right in holding that
a fresh writ petition was not maintainable before it in
respect of the same subject-matter since the earlier writ
H petition had been withdrawn without permission to file a
BAKSHI DEV RAJ & ANR. v. SUDHIR KUMAR 841
[P. SATHASIVAM, J.]

fresh petition. We, however, make it clear that whatever A
we have stated in this order may not be considered as
being applicable to a writ petition involving the personal
liberty of an individual in which the petitioner prays for the
~
¥ issue of a writ in the nature of habeas corpus or seeks to
enforce the fundamental rignt guaranteed under Article 21 B
of the Constitution since such a case stands on a different
footing altogether. We, however leave this question open."

19. In the light of the discussion in the earlier paragraphs
even after dismissal of an SLP with or without reasons, the
aggrieved party is entitled to file a review. In view of the
c
language used in Order XLVll Rule 1(a) of CPC which relates
' to "Review", the present Review Petition (C) No. D-5/2008)
cannot be dismissed on the ground of maintainability. Based
/'"·
on the above discussion and reasons, we hold that the review
petition filed by the appellants was maintainable but in view of D
Order Ill Rules 1 and 4, Chapter relating to the role of Pleaders,
and in view of the conduct of the appellants in not raising any
objection as to the act of their counsel except filing review
petition, we are not inclined to accept the claim of the
appellants. E

20. Finally, Mr. Garg vehemently contended that by the
concession of their counsel, appellants lost their property and
they suffered huge loss in terms of money. On perusal of the
modified decree as available in the order of the High Court in F
Second Appeal No. 19 of 2005 and the sketch produced about
the existence of Sheesham and Shreen trees running as a
demarcating line and whenever those trees fall on either side
the parties having ownership of the land get right to use the
~ same, we are unable to accept the said contention also.
G
21. In the light of the above discussion, we find !10 merit in
both the appeals. Consequently, the same are dismissed.
There shall be no order as to costs.

N.J. Appeal dismissed. H