Case Note & Summary
The Supreme Court was hearing a civil appeal directed against a judgment and order dated 23.10.2008 passed by the High Court of Judicature at Madras in AS No.1397/1994, which had set aside the judgment and decree dated 30.09.1994 passed by the II Additional Sub Court at Coimbatore in O.S. No.22/1986. During the pendency of the appeal, the parties themselves settled the matter and produced a Settlement Agreement dated 05.10.2023 along with their affidavits in I.A. No.216386/2023 dated 15.10.2023. The parties appeared before the Court through virtual mode and endorsed the factum of settlement. The Court noted that the Settlement Agreement revealed all parties had put their signatures before the Trial Court pursuant to the order of the Supreme Court dated 29.11.2023. The main legal issue before the Court was whether to dispose of the appeal based on the settlement agreement reached between the parties. The appellants argued through their Senior Counsel Ms. V. Mohana, while the respondents were represented by their counsel. The respondents submitted that the period prescribed in Clause (6) of the Settlement Agreement for handing over a 'No Objection Certificate' could be extended by two months from the date of judgment. The Court interacted with the parties and Mr. Karthik representing their side consented to granting extension of the period. The Court analyzed the settlement agreement and noted that the parties were close relatives and financial liabilities had been fulfilled in terms of the Settlement Agreement dated 15.10.2023. The Court held that the impugned judgment and decree in AS No.1397/1994 and the judgment in O.S. No.22/1986 were liable to be set aside. Accordingly, the Court set aside both judgments and decrees, modified Clause (6) regarding the time period by granting extension of two months from the date of judgment, and made it clear that hereafter the parties would be bound by the terms and conditions of the Settlement Agreement dated 05.10.2023. The Court directed the Registry to draw a decree in terms of the Settlement Agreement and based on the judgment, and closed the execution proceedings pending before the II Additional Sub Court at Coimbatore. The civil appeal was disposed of accordingly, and all pending applications stood disposed of.
Headnote
A) Civil Procedure - Settlement Agreements - Binding Nature and Modification - Code of Civil Procedure, 1908 - The Supreme Court considered a settlement agreement dated 05.10.2023 reached between parties who are close relatives, where financial liabilities had been fulfilled. The Court modified the time period in Clause (6) of the agreement, extending it by two months from the date of judgment. Held that the impugned judgments and decrees were liable to be set aside and parties would be bound by the settlement terms. (Paras 3-4) B) Civil Procedure - Appeal Disposal - Based on Mutual Settlement - Code of Civil Procedure, 1908 - The Supreme Court disposed of the civil appeal after parties reached a settlement agreement during pendency of the appeal. The Court recorded the settlement, modified the time period for compliance, and directed the Registry to draw a decree in terms of the settlement agreement. Held that the appeal stands disposed of based on the settlement. (Paras 3-5)
Issue of Consideration
Whether the appeal should be disposed of based on the settlement agreement reached between the parties
Final Decision
The Supreme Court set aside the impugned judgment and decree in AS No.1397/1994 and the judgment in O.S. No.22/1986. Modified Clause (6) of Settlement Agreement regarding time period by granting extension of two months from date of judgment. Directed Registry to draw decree in terms of Settlement Agreement dated 05.10.2023 and based on judgment. Closed execution proceedings pending before II Additional Sub Court at Coimbatore. Disposed of civil appeal.
Law Points
- Settlement agreements in civil disputes
- court's power to modify terms for extension of time
- binding nature of settlement on parties
- disposal of appeals based on mutual settlement
