Madhya Pradesh High Court
Akhilesh Jain vs Bhagwati Bai Saharia on 11 November, 2025
Author: Hirdesh
Bench: Hirdesh
NEUTRAL CITATION NO. 2025:MPHC-GWL:28613
1 MP-6032-2024
IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE HIRDESH
ON THE 11th OF NOVEMBER, 2025
MISC. PETITION No. 6032 of 2024
AKHILESH JAIN
Versus
BHAGWATI BAI SAHARIA AND OTHERS
Appearance:
Shri Vibhor Kumar Sahu - learned Counsel for petitioner.
Shri Sanjay Singh Kushwaha- learned Govt. Advocate for respondent
No.14/State.
ORDER
The present miscellaneous petition under Article 227 of the Constitution of India has been filed by the petitioner-plaintiff being aggrieved by the impugned order dated 20.09.2024 passed by the Court of First Civil Judge, Senior Division, Guna in Regular Civil Suit No.103 of 2024, whereby the application filed under Order XXIII Rule 3 of the Code of Civil Procedure, 1908 for passing a decree on the basis of compromise has been rejected.
2. Briefly stated, the petitioner-plaintiff instituted a civil suit seeking declaration and permanent injunction against respondents Nos.1 to 13 and the State (respondent No.14 - formal party). It was pleaded that an agreement to sell had been executed between the petitioner and respondents Nos.1 to 13 in respect of agricultural land bearing Survey No.13/2, total area Signature Not Verified Signed by: AVINASH BHARGAV Signing time: 12-Nov-25 05:50:22 PM NEUTRAL CITATION NO. 2025:MPHC-GWL:28613 2 MP-6032-2024 2.487 hectares, out of which the share of respondents Nos.1 to 13 measured 1.776 hectares, situated at village Jaganpur, Patwari Halka No.59 (New No.02), Tehsil and District Guna.
3. The said agreement to sell was registered on 13.06.2023 in the office of the Deputy Registrar, Guna. The total sale consideration was fixed at Rs.84,00,000/-, out of which an amount of Rs.17,00,000/- was received by respondents Nos.1 to 13 as advance, and the balance Rs.67,00,000/- was agreed to be paid at the time of execution of the sale deed. The petitioner, therefore, sought a declaration and injunction restraining the defendants from alienating the suit land to any third person, and further prayed for a direction to execute the sale deed in favour of the petitioner after obtaining necessary permission from the competent authority.
4. During pendency of the suit, on 25.07.2024, an application under Order XXIII Rule 3 CPC was jointly filed by the defendants, stating that the dispute between the parties had been amicably settled and that the defendants were ready to comply with the terms of the agreement and to honour the reliefs sought in the plaint (specifically in paragraph 10). It was also mentioned in the compromise that the sale deed would be executed only after obtaining the requisite permission from the competent authority, as mandated by law.
5. The trial Court, by the impugned order dated 20.09.2024, rejected the said application on the ground that the suit property was originally allotted by the State Government and is not transferable without prior permission of the competent authority, thereby holding that the compromise Signature Not Verified Signed by: AVINASH BHARGAV Signing time: 12-Nov-25 05:50:22 PM NEUTRAL CITATION NO. 2025:MPHC-GWL:28613 3 MP-6032-2024 was not lawful within the meaning of Order XXIII Rule 3 CPC. Aggrieved thereby, the petitioner-plaintiff has preferred this petition.
6. Learned counsel for the petitioner submitted that the trial Court has committed a serious error in rejecting the application. It was contended that the agreement to sell itself, as well as the compromise application, specifically stipulated that the sale transaction would be completed only after obtaining necessary permission from the competent authority under Section 165(7-B) of the Madhya Pradesh Land Revenue Code, 1959 (for short, "the MPLRC").
7. It was urged that the decree sought was merely conditional in nature, binding the parties to honour the terms of the agreement after obtaining statutory permission. Therefore, no illegality or contravention of the MPLRC was involved. The rejection of the application on the assumption that the land is non-transferable, without appreciating the conditional nature of the compromise, is manifestly erroneous.
8. It was further argued that by allowing such a conditional compromise, no immediate transfer of title would take place. Rather, the decree would only record the settlement and bind the parties to complete the transaction as and when the competent authority grants permission. Hence, such a decree would be lawful and enforceable.
9. In support of his submissions, learned counsel relied upon the judgment of the Hon'ble Supreme Court in Babasaheb Dhondiba Kute v. Radhu Vithoba Barde (2014 INSC 122), wherein it was held that a conditional compromise decree can lawfully be passed if the condition is Signature Not Verified Signed by: AVINASH BHARGAV Signing time: 12-Nov-25 05:50:22 PM NEUTRAL CITATION NO. 2025:MPHC-GWL:28613 4 MP-6032-2024 neither illegal nor opposed to public policy.
10. Learned Government Advocate appearing for the State opposed the petition and supported the impugned order. It was submitted that since the land in question was government-allotted land, its transfer without permission is restricted under Section 165(7-B) of the MPLRC, and therefore, the trial Court rightly rejected the compromise application.
11. I have heard learned counsel for the parties and carefully perused the impugned order as well as the record.
12. The short question involved is whether the trial Court was justified in rejecting the application under Order XXIII Rule 3 CPC solely on the ground that the land in question was non-transferable without permission from the competent authority.
13. In Babasaheb Dhondiba Kute (supra), the Hon'ble Supreme Court has authoritatively held that where parties enter into a lawful and conditional compromise, the Court is bound to record it if the compromise is voluntary, the terms are not illegal or contrary to statute, and the condition precedent can be satisfied in accordance with law. The Apex Court clarified that a decree based on such a conditional compromise would take effect upon fulfillment of the specified condition and that the decree itself does not operate as an unlawful transfer.
14. Applying the above principle to the present case, it is apparent that both parties had mutually agreed that the sale deed would be executed only after obtaining permission from the competent authority under Section 165(7-B) of the MPLRC. Such a stipulation makes the compromise Signature Not Verified Signed by: AVINASH BHARGAV Signing time: 12-Nov-25 05:50:22 PM NEUTRAL CITATION NO. 2025:MPHC-GWL:28613 5 MP-6032-2024 conditional and lawful. Passing a decree on that basis would merely recognize the settlement between the parties and would not itself amount to a transfer of the property. The transfer, if at all, would occur only after statutory compliance and permission from the authority concerned.
15. The trial Court, therefore, erred in rejecting the compromise application by misinterpreting the law. The rejection of the compromise has resulted in failure of justice and unnecessary prolongation of litigation between the parties.
16. In view of the discussion hereinabove and in light of the law laid down by the Hon'ble Supreme Court in Babasaheb Dhondiba Kute (supra), this Court finds that the impugned order dated 20.09.2024 suffers from material illegality and cannot be sustained.
17. Accordingly, this miscellaneous petition is allowed. The impugned order dated 20.09.2024 passed by the First Civil Judge, Senior Division, Guna in Regular Civil Suit No.103 of 2024 is set aside. The trial Court is directed to record the compromise under Order XXIII Rule 3 CPC and pass a conditional compromise decree, stipulating that the execution of sale deed shall be subject to obtaining due permission from the competent authority under Section 165(7-B) of the MPLRC.
18. No order as to costs..
(HIRDESH) JUDGE MKB Signature Not Verified Signed by: AVINASH BHARGAV Signing time: 12-Nov-25 05:50:22 PM