Anitha Saravanan v. Sasi Kumar, Valsan and The Secretary, Thiroor Service Co-Operative Bank Ltd.

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOMAS P.JOSEPH MONDAY, THE 4TH JULY 2011 / 13TH ASHADHA 1933 OP(C).No. 2108 of 2011(O) ------------------------OS.502/2008 of I ADDL.SUB COURT, THRISSUR .................... PETITIONER ------------------ ANITHA SARAVANAN, D/O.THAIKATTUSSERY APPUKUTTAN, ATTORE DESOM, POTTORE VILLAGE, THRISSUR DISTRICT. BY ADV. SRI.M.K.DILEEP KUMAR RESPONDENTS: --------------- 1. SASI KUMAR, S/O.BALAKRISHNAN, NARANGAL HOUSE, VIYYUR VILLAGE (POST), THRISSUR DISTRICT, PIN 680010. 2. VALSAN, S/O.KAMALAMMA, KOMBATH HOUSE, ATTORE, POTTORE VILLAGE (POST), THRISSUR DISTRICT, PIN 680 581. 3. THE SECRETARY, THIROOR SERVICE CO-OPERATIVE BANK LTD., THIROOR, THRISSUR DISTRICT, POST MULANGUNNATHKAVU, PIN 680 581. THIS OP (CIVIL) HAVING COME UP FOR ADMISSION ON 04/07/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: OP(C).No. 2108 of 2011(O) ## APPENDIX -------------- PETITIONER'S EXHIBITS ---------------------------------- P1:- TRUE COPY OF THE PLAINT IN O.S.NO.502/2008 BEFORE THE SUB COURT, THRISSUR. P2:- TRUE COPY OF THE WRITTEN STATEMENT FILED BY THE PETITIONER IN O.S.502/2008 BEFORE THE SUB COURT, THRISSUR. P3:- CERTIFIED COPY OF THE COMPROMISE PETITION FILED BY PETITIONER AND THE FIRST RESPONDENT IN O.S. 502/2008 BEFORE THE SUB COURT, THRISSUR. RESPPONDENT'S EXHIBITS :- NIL //TRUE COPY// PA TO JUDGE ## **THOMAS P. JOSEPH, J. ~~~~~~~~~~~~~~~~ O.P.(C). No.2108 of 2011 ~~~~~~~~~~~~~~~~~ Dated this the 4[th] day of July 2011** ## **J U D G M E N T** Petitioner is 2[nd] defendant in O.S.No.502 of 2008 of the court of learned Sub Judge, Thrissur. When the suit was pending the dispute was referred to the Lok Adalath where (allegedly) the matter was settled and an award was passed on 10.10.2008. When the first respondent sought to execute that award through the civil court, petitioner has approached this Court under Article 227 of the Constitution to declare that petitioner has executed Ext.P3 compromise without understanding the terms and consequences arising out of it, she was defrauded in the matter of settlement of the suit before the Lok Adalath and to set aside Ext.P3, compromise and the decree in O.S.No.502 of 2008. 2. Learned counsel for petitioner contended that facts and circumstances of the case would indicate that O.P.(C). No.2108 of 2011 -: 2 :- fraud was played on petitioner and she was made to sign the compromise without understanding the contents. It is contended that since proceedings are vitiated by fraud, it is void ab initio. Learned counsel for first respondent contended that the fact of compromise was acknowledged by petitioner even in the proceedings in execution of the award. 3. The whole issue arose out of an agreement allegedly executed by respondents 1 and 2 as per which the first respondent agreed to purchase property belonging to the petitioner and is said to have paid advance to the 2[nd] respondent allegedly on behalf of petitioner. First respondent filed the suit for prohibitory injunction to restrain petitioner from transferring the property to any person other than first respondent. It is while the civil suit was pending that the matter was referred to the Lok Adalath for settlement. Before the Lok Adalath, it is alleged, that a settlement was entered into between petitioner and O.P.(C). No.2108 of 2011 -: 3 :- the first respondent. In the compromise petition it is stated that petitioner received a further sum of `50,000/- also from the first respondent and agreed to pay the entire amount (including the amount allegedly received from the 2[nd] respondent as well) to the first respondent within the time specified and in case payment is not made, petitioner was to execute assignment deed in respect of the property to the first respondent. The Lok Adalath passed award based on that compromise. Accepting the compromise, the learned Sub Judge disposed of the suit. Later contending that the petitioner has not paid the amount within the stipulated time, first respondent filed I.A.No.749 of 2009 for execution of the sale deed. To that application, petitioner filed a counter statement on 7.3.2009 wherein she is said to have admitted fact of compromise before the Lok Adalath but, explained the reason for not paying the amount within the stipulated time. 4. Learned counsel for petitioner points out that O.P.(C). No.2108 of 2011 -: 4 :- even as admitted by the first respondent, the agreement for sale was not between petitioner and the first respondent and there was no privity of contract between petitioner and the first respondent. It is pointed out by learned counsel that even though a counter statement was field in I.A.No.749 of 2009 petitioner is seen declared absent and set ex-parte. 5. There can be no doubt that compromise petition is the result of fraud played on petitioner, the award passed on the basis of that compromise cannot stand. But, that is not a matter which this Court is required to go into under Article 227 of the Constitution since disputed questions of fact which requires evidence to substantiate it are involved. It is agreed by both sides that no decree is passed by the civil court based on the (alleged) compromise so that, petitioner has to move in the same suit as provided in order XXIII, Rule 3 of the Code of Civil Procedure. Since what is challenge is the compromise in the Lok Adalath and the O.P.(C). No.2108 of 2011 -: 5 :- award passed by it, petitioner has to approach the civil court and challenge the compromise and award of the Lok Adalath on the ground of fraud as pleaded by her. In **Maria Chemicals** v. **Union of India** [2004 (2) KLT 273 (SC)] the Apex Court has held referring to the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and decision of the Debt Recovery Tribunal that to a very limited extent jurisdiction of the civil court can be invoked if the action of the secured creditor is alleged to be fraudulent. When a decision of a Tribunal or other authority is challenged on the ground of fraud, the civil court has the jurisdiction to decide that question. In the circumstances, proper course open to the petitioner is to challenge the impugned award of the Lok Adalath in the civil court on the ground that fraud was played on her (as pleaded by her). Since that remedy is available to the petitioner, this writ petition cannot be entertained. O.P.(C). No.2108 of 2011 -: 6 :- Resultantly without prejudice to the right of petitioner to challenge the award of the Lok Adalath as stated above, this writ petition is closed. **Sd/THOMAS P. JOSEPH, JUDGE.** Jvt The words “if the” are inserted after the words “There can be no doubt that” and before the words “compromise petition” in the first sentence in paragraph 5 of the judgment dated 04/07/2011 in O.P.(C) 2108/2011, vide order dated 14/07/2011 in I.A.11318/2011 in O.P.(C) 2108/2011. **Sd/Registrar (Judicial)**