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Ram Juwan v. Devendra Nath Gupta .

Madhya Pradesh High Court
Jan 13, 1960
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Summary of the Legal Opinion

Factual and Procedural Background

The tenant, Devendra Nath Gupta (non-petitioner), sued his landlord Ramjiwan before the Rent Controller under Section 8 of the Madhya Bharat Accommodation Control Act of 1955, alleging that the landlord had, without sufficient cause, cut off the tenant's electric connection and asking for restoration of the connection. The landlord resisted on the ground that the Electric Company had cut off the connection of the whole house (including the disputed portion) because the tenant had not paid electric charges.

The Rent Controller ordered restoration of the electric connection within two days and awarded compensation to the tenant at the rate of eight annas per day. On appeal, the District Judge rejected the landlord's appeal, allowed the tenant's appeal, and increased the compensation to Rs. 2 per day, the maximum payable under the Act. As the District Judge's order was final, the landlord filed a petition under Article 227 of the Constitution of India. During the hearing before the High Court, the parties reached a compromise, and the petition was disposed of according to the terms of that compromise.

The present miscellaneous petition was filed by the landlord claiming that the tenant did not observe the compromise terms and seeking (1) initiation of contempt proceedings for breach of the compromise, and (2) an order directing the tenant to vacate the premises and pay arrears (and that the matter be sent to the lower court for execution).

Legal Issues Presented

  1. Whether a breach of the terms of a compromise (recorded and embodied in a decree) constitutes contempt of court such that committal proceedings can be initiated against the defaulting party.
  2. Whether terms in a consent decree that do not relate to the subject-matter of the suit (extraneous terms, e.g., payment of arrears and eviction) can be enforced by execution of the decree or must be enforced by a separate suit.

Arguments of the Parties

Landlord's Arguments (Applicant)

  • The tenant's failure to carry out the terms of the compromise amounted to a breach of a personal undertaking to the Court and therefore constituted contempt of court punishable by committal.
  • Counsel for the landlord (Mr. Hariharniwas Dwivedi) relied on two authorities to support the proposition that failure to observe compromise terms is contempt: (a) Bajranglal Gangadhar v. Kapur Chand Ltd., AIR 1950 Bom 336; and (b) Suretennessa Bibi v. Chintaharan Dass, (S) AIR 1955 Cal 182.

Tenant's Arguments

The opinion records the tenant's earlier defence in the original suit that the Electric Company had cut off the connection of the whole house because the tenant had not paid electric charges. The opinion does not contain a detailed account of the tenant's legal arguments in response to the present application alleging breach of the compromise.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Bajranglal Gangadhar v. Kapur Chand Ltd., AIR 1950 Bom 336 Held that where terms of a compromise recorded by the Court are not carried out, the defaulting party is guilty of breach of a personal undertaking to the Court and may be punished for contempt (per Bombay High Court Division Bench). The Court examined and disagreed with this precedent on the central point. It held that a compromise embodied in a decree is an agreement between parties and not necessarily an undertaking to the Court capable of committal proceedings; distinguished the scope of undertakings contemplated in authorities cited.
Suretennessa Bibi v. Chintaharan Dass, (S) AIR 1955 Cal 182 Expressed the view that breach of a compromise recorded by the court amounts to contempt because breach of an undertaking given to the Court is misconduct amounting to contempt. The Court observed that the Calcutta decision did not give reasons or cite supporting authorities to justify treating a compromise as an undertaking to the Court and rejected the broad proposition that every breach of compromise is contempt.
Cotton v. Heyl, (1930) 1 Ch 510 English authority relied upon to show that undertakings given in actions which were compromised could be enforced; the facts involved an undertaking given in pending proceedings and contempt was ordered, with reference to the Debtor's Act allowing imprisonment for default. The Court found that the English case involved an undertaking given in pending proceedings and that committal was ordered under statutory provisions (Debtor's Act 1869) enabling imprisonment — distinguishing Cotton's facts and statutory basis from the present Indian context where no similar statute exists.
Vishnu Sitaram v. Ramchandra Govind, 139 Ind Gaz 830 : AIR 1932 Bom 466 Held that terms of a compromise which do not relate to the subject-matter of the suit cannot be enforced in execution of the decree but must be enforced as a contract by a separate suit. The Court expressly agreed with this Bombay High Court view and held that extraneous terms in the consent decree are not enforceable by execution; the landlord must file a separate suit to enforce such terms.
Jasimuddin Biswas v. Bhuban Jelini, ILR 34 Cal 456 Calcutta High Court authority holding that terms of a compromise extraneous to the suit cannot be enforced by execution of the decree and should be pursued by a separate suit. The Court concurred with the Calcutta view (as applied to extraneous terms) and used it to support the conclusion that the consent decree's provisions regarding arrears and eviction (not relating to the original suit) cannot be executed but must be enforced by separate proceedings.

Court's Reasoning and Analysis

The Court divided its analysis into two parts corresponding to the two principal questions raised by the landlord.

On whether breach of a compromise constitutes contempt:

  • The Court examined the authorities relied upon by the landlord (Bombay and Calcutta decisions) and the statements in learned treatises such as Oswald on Contempt and Halsbury's Laws of England concerning undertakings to the court.
  • The Court emphasised a distinction between (a) an "undertaking given to the Court" during the pendency of proceedings (for example, a party orally or by assurance undertakes not to do some act so that the court refrains from issuing an order), and (b) a compromise or agreement between the parties which the court is then obliged to record under Order 23 Rule 3 CPC and pass a decree in its terms.
  • Relying on the nature of a compromise as an agreement between parties rather than an undertaking to the Court, the Court held that the undertakings referred to in the authorities (and in Oswald/Halsbury) are those given in pending proceedings on which the court's conduct changes (e.g., the court refrains from issuing an injunction because of the undertaking). Such undertakings are personal assurances to the court and breaches of them may amount to contempt.
  • By contrast, once parties reach a compromise, the court's role under Order 23 Rule 3 CPC is ministerial/mandatory to record and pass a decree if the agreement is lawful; the Court cannot treat the compromise as a discretionary "undertaking" to itself. Therefore, a compromise embodied in a decree is not necessarily an undertaking to the court the breach of which automatically warrants committal proceedings.
  • The Court carefully distinguished the English authority Cotton v. Heyl on the ground that in that case the undertaking was given in pending proceedings and contempt was ordered under statutory provisions (exceptions to the Debtor's Act 1869) which permitted imprisonment for default — a statutory basis absent in India.
  • Given these distinctions, the Court concluded that the precedents relied on did not support instituting committal proceedings for breach of a compromise embodied in a decree in the present circumstances.

On whether extraneous terms in the consent decree can be executed:

  • The Court observed that the original suit concerned restoration of the electric connection. The consent decree, however, included provisions (payment of arrears and eviction in default) that were not matters relating to that suit; i.e., they were extraneous to the subject-matter.
  • There is a conflict of authority on whether such extraneous terms can be executed: some High Courts (Allahabad, Madras) permitted execution; Bombay and Calcutta High Courts held they could not be executed but could be enforced by a separate suit.
  • The Court aligned itself with the Bombay and Calcutta view, reasoning that Order 23 Rule 3 CPC requires the court to record the adjustment of the suit and pass a decree according to it; references in a compromise to matters extraneous to the suit are in effect separate agreements and should be enforced by ordinary contract remedies (a separate suit), not by execution of the decree.
  • Consequently, the Court held that the parts of the consent decree not relating to the suit could not be executed and that the landlord must bring a separate suit to enforce those terms.

Holding and Implications

Final Disposition: The application is dismissed. The Court decided both questions against the applicant (landlord).

Immediate consequences for the parties:

  • No committal or contempt proceedings were permissible on the basis of the breach of the compromise embodied in the decree, because the Court held that a compromise recorded under Order 23 Rule 3 CPC is not necessarily an undertaking to the Court enforceable by committal.
  • The portions of the consent decree that were extraneous to the original suit (payment of arrears and eviction in default) cannot be executed through decree execution; the landlord must sue separately to enforce those contractual terms.
  • The application was dismissed and the parties were directed to bear their own costs of the application.

Broader implications: The opinion articulates and applies a distinction between undertakings given to a court in pending proceedings and compromises between parties embodied in decrees under Order 23 Rule 3 CPC. The Court expressly rejected the proposition (as applied from certain precedents) that every breach of a compromise recorded by the court is contempt punishable by committal in the absence of statutory authority. The opinion concludes by directing the applicant to seek contractual remedies by a separate suit for extraneous terms. The opinion does not state that it is establishing a new binding precedent beyond the holdings expressed herein.

Show all summary ...

1. The facts giving rise to this Miscellaneous Petition are that the non-petitioner (Devendra Nath Gupta), who is a tenant of the petitioner Ramjiwan, filed a suit before the Rent Controller, under Section 8 of the Madhya Bharat Accommodation Control Act of 1955 (Act No. 23 of 1956), alleging that the landlord, had, without sufficient cause cut off the tenant's electric connection and prayed that the landlord be directed to restore it. This was resisted by the landlord on the ground that because the tenant had not paid electric charges, the Electric Company had cut off the connection of the whole house, including the portion in dispute.

The Rent Controller ordered the landlord to restore the electric connection within 2 days from the order and, awarded compensation for the inconvenience caused to the tenant at the rate of Rs. -/8/- per day. Both the parties went in appeal before the District Judge, who rejected the appeal of the landlord but allowed the appeal of the tenant, and raised, the amount of compensation from annas eight per day to Rs. 2/- per day, the maximum amount that he could have awarded under the Act.

AS the order of the District Judge was final, the landlord, Ramjiwan filed a petition under Article 227 of the Constitution of India. In the course of the hearing of the petition before the High Court, the parties arrived at a compromise and the petition instead of being considered on merits was disposed of according to the terms of the compromise.

2. This is an application of the landlord, complaining that the tenant did not observe the terms of the compromise and that in the circumstances the landlord was entitled to the eviction of the tenant from the premises according to the compromise. The prayers made in the present petition are in the main two :

One: That contempt proceedings may be taken against the opposite party for not obeying the order of the Court and not acting according to the compromise.

Two : That the tenant Devendra Nath Gupta be directed to vacate the premises and pay up the arrears due.

3. In respect of the first contention, namely, that contempt proceedings may be taken against the tenant, it is argued by Mr. Hariharniwas Dwivedi, that the tenant, in not carrying out the terms of the compromise (a compromise is as undertaking to the Court) has committed contempt of the Court and must therefore be punished for it. He relies upon two authorities :

(1) Bajranglal Gangadhar v. Kapur Chand Ltd., AIR 1950 Bom 336.

(2) Suretennessa Bibi v. Chintaharan Dass, (S) AIR 1955 Cal 182.

4. In both these cases it has been held that when the terms of compromise are not carried out by any party then that party is guilty of a deliberate breach of the personal undertaking given by him to High Court and that this misconduct amounts to contempt.

5. I propose to examine both the rulings separately.

6. I shall first deal with the Bombay case AIR 1950 Bom 336. In a suit filed by the plaintiff for specific performance, the parties compromised the action and the consent terms were reduced to writing and a decree was passed in terms of the compromise. The defendant failed to observe the terms of the compromise whereupon a motion was. taken out by the plaintiff for contempt of court. A Single Judge of the Bombay High Court ordered that the defendant should carry out the undertaking within one month from the date of the order, otherwise a warrant would issue for the committal of the defendant to prison. An appeal was filed against the order of the Single Judge before a Division Bench.

In the Division Bench Chagla, C. J., as he then was, took the view that the compromise bet-

ween the parties recorded by the Court was also an undertaking to the Court, and this undertaking can be enforced by proper committal proceedings. In adopting this view Chagla, C. J. referred to Oswald on Contempt from which the following passage was also reproduced in the judgment:

"An undertaking entered into or given to the Court by a party or his counsel or solicitor is equivalent to and has the effect of an order of the Court, so far as any infringement thereof may be made the subject of an application to the Court to punish for its breach."

With great respect and much deference to the learned Judges of the Bombay High Court, I beg to differ. Chapter IV of Oswald on Contempt deals with disobedience to order or breach of undertakings. I have no doubt that when an order or an undertaking is given to the Court, a breach of it is contempt of court. The question is, what is meant in this context by the order of the Court or undertaking given to the Court? Is a decree passed on compromise an undertaking to the Court as decided in AIR 1950 Bom 336 and (S) AIR 1955 Cal 182?

7. The undertaking referred to in Oswald, refers to an undertaking given to the Court which is quite different from what the parties have agreed between themselves. A compromise is an agreement between the parties and not an undertaking to the Court that parties would observe its terms. As for orders disobedience to which is contempt of the court punishable by committal, are meant orders relating to injunctions requiring a person to do an act or abstain from doing it. Other kinds of orders, which fall in this category are orders such as the failure of a party to comply with an order to answer interrogatories, or discovery, or inspection of document.

8. Sir Dinshaw Mulla in his commentary of the Code of Civil Procedure (1953 Edition) page 683 under Order 11 Rule 10 (sic) C. P. C. has stated that apart from the fact that if a party docs not comply with, the order of the Court, penalty is provided, in that if the disobedience is by the plaintiff, his suit is liable to be dismissed and if it is by the defendant, his defence will be struck off, a party is also liable to be committed for contempt. I venture to suggest that the orders referred to in Oswald are such orders.

9. The learned Judges of the Bombay High Court have treated a compromise as if it was an undertaking to the Court. An undertaking contemplated by Oswald is an undertaking given by any person when during the pendency of the suit, the court is assured by the party that it will not do a particular thing. On such an assurance being given, the court does not pass an order which it would have otherwise passed. For instance in a dispute about the building of a wall, the defendant may give an undertaking to the Court that till the final decision he would not build the wall any more.

On such assurance or undertaking being given, the Court would not issue an injunction against the defendant, restraining him to continue building the wall. The undertaking referred to in Oswald is of this kind. But in a case of compromise arrived at between the parties, I am afraid, no undertaking is given to the Court. In Halsbury's Laws of England (3rd Edition) Volume 8 page 29 para 51, it is said "that the breach of an undertaking given to the Court by a person or corporation, in pending proceedings, on the faith of which, the court sanctions a particular course of action or in-action, is misconduct amounting to contempt.'' This passage from Halsbury bears me out that the undertaking is in pending proceedings. Such an undertaking at the conclusion of the case, ceased to exist.

10. In a compromise which is embodied in a Court's decree the parties as between themselves agree to do certain things. No question of any undertaking to the Court is involved in a compromise. Where an action is compromised the Court is bound under Order 23 Rule 3, C. P. C. to record it and pass a decree in terms of it. All that the court is concerned before passing a decree in terms ot the compromise is to see whether the compromise is a lawful agreement or not. Once it finds the agreement between the parties to be lawful (the parties may agree to any terms) the court is bound to record it. If a compromise is an undertaking to the Court, then the Court is a free agent to act or not to act, and the court may accept the compromise or reject it. But under Order 23 Rule 3, the Court has no choice but to record the agreement and pass a decree in its terms.

11. The Bombay High Court in taking the view it did relied upon an English case, Cotton v. Heyl, (1930) 1 Ch 510. But I am afraid that the facts ot the English case, (to which I shall refer in the next paragraph) were not properly appreciated.

12. In coming to the conclusion that a compromise was an undertaking to the Court, the learned Judges of the Bombay High Court after referring to the above English case said that it "goes to show that even if an undertaking was given in an action which was compromised .....

One of the terms was an undertaking to pay the plaintiff a sum of £ 1,000/- forthwith (which was duly paid and a further sum of £ 4,000/- was to be paid out of the first moneys received by the defendant on a future sale of his rights in the invention to the plaintiff. The sum of £ 4,000/- was not paid as stipulated.

14. Now there are two things which were overlooked by the Bombay High Court. First, that it was an undertaking given in a pending case as. the words of the order

"that all further proceedings in the action be stayed except so far as may be necessary for giving effect to the said terms (ot compromise)"
show. Secondly and it is the most important fact which somehow or other escaped the notice of the learned Judge of the Bombay High Court, that in the English case contempt proceedings were taken because the case fell within, the third exception to the Debtor's Act of 1869, Section 4. It seems that the English Debtor's Act of 1869, specifically provided that in certain cases parties on committing default may be imprisoned.

A breach of a term was an offence under the exceptions to Debtor's Act, 1869. Oswald on Contempt page 113, has dealt with the Debtor's Act in detail and for the purpose of this case it is unnecessary to deal with the Act any further. Thus it would appear that in the English case (1930-1 Ch 510), referred to above, committal proceedings were ordered on the basis of a statute, which enabled a court to do so. But in India, we have no such statute.

15. In the Calcutta case, ((S) AIR 1955 Cal 182), the learned Judges have not given any reason for holding that a compromise between the parties amounts to an undertaking to the Court, beyond observing that

"it is settled law that breach of an undertaking given to a Court by a person in a particular course of action is misconduct amounting to contempt."

But I have been unable to find authorities, which the learned Judges had in their mind. The learned Judges seem to be of the view that in recording a compromise and passing a decree in accordance therewith, "the court sanctions a particular course of action." But with respect, I submit that where a case is adjusted by a lawful agreement or compromise, then it is the bounden duty of the Court to record it and pass a decree in accordance with it. No option is left to the Court to examine the terms of the compromise beyond seeing whether the agreement is lawful or not.

The learned Judges of the Calcutta High Court in saying that the Court "sanctions a particular course of action" imply as if a court may or may not record the compromise. But the use of the language "shall order such agreement to be recorded and shall pass a decree" are mandatory and no question of any sanction of the Court arises. Order 23 Rule 3 Civil Procedure Code makes it obligatory on the court to record a compromise duly entered into by the parties to a suit and it also makes it obligatory on. the Court to pass a decree in terms of a compromise. Thus no question of any sanction of the court arises.

16. For reasons stated above, I hold that a compromise between parties on the basis of which a decree has been made, is not at all an undertaking to the court, and, on breach of terms of compromise embodied in the decree, no committal proceedings can be initiated. The first question is, therefore, decided against the applicant (landlord).

17. With regard to the second question, namely, that I should order the tenant to vacate the house and pay up arrears and for that purpose send the case to the lower court for execution of this part of the order, I find that the consent decree embraced matters that did not relate to the suit. The suit in the instant case was for ordering the defendant (landlord) to restore the electric connection which he was alleged to have cut off. The consent decree inter alia was for payment of arrears and for vacating the premises in case a default was made. Thus the consent decree included matters not relating to the suit.

18. Where a consent decree contains terms that do not relate to the suit, there is a conflict of opinion whether such terms can be enforced in execution. While Allahabad and Madras High Courts have held that such terms can be enforced in execution, the High Court of Bombay in Vishnu Sitaram v. Ramchandra Govind, 139 Ind Gas 830: (AIR 1932 Bom 466) and the High Court of Calcutta in Jasimuddin Biswas v. Bhuban Jelini, ILR 34 Cal 456 have laid down that such terms cannot be enforced in execution of the decree but they may be I enforced as a contract by a separate suit.

I find myself in respectful agreement with the Bombay and Calcutta views, because according to Order 23 Rule 3 C. P. C., it is the adjustment of compromise of the suit before the Court that has to be recorded and a decree has to be passed according to it. Any reference in the compromise to matter extraneous to the suit would be an agreement and not a compromise in the suit and the proper thing for the parties in such circumstances is to enforce the agreement by a separate suit.

I, therefore, hold that that part of the order which did not relate to the suit cannot be executed and that the applicant shall have to bring a separate suit for it. The second question is also decided against the applicant.

19. In result, the application is dismissed. The parties shall bear their own costs of this application.