Bukhtiarpur Bihar Light Rly. Co. Ltd. vs State Of Bihar And Ors. on 8 September, 1950
21. My learned brother has quoted in full the agreement of 23.6-1950. I agree with his conclusion that that agreement was a contract between the parties, and not an undertaking to the Court. The distinction between an agreement with the sanction of the Court superadded to it, and an undertaking to the Court on the faith of which the Court sanctions a particular course of action or inaction is not easy to define or determine ; much will depend on the circumstances in which the agreement is made, and the words in which it is expressed to embody the intention of the parties : (see the observations in Nisa Kanto v. Saroj Bashini, A. I. R. (85) 1948 Cal. 294 : (49 or. L. J. 567). The agreement in this case did not result in any order of the Court, except disposal of the application without consideration of merits and a termination of the interim order of injunction. It saved "whatever right the parties may have in respect of the matters in dispute" (see the opening clause of the agreement). I accept Mr. P. R. Das's contention that this opening clause does not mean that the points regarding which the parties definitely agreed in the four clauses of the agreement, are to be included in the saving clause, so as to unsettle what has been agreed to. I also accept his argument as to the meaning of Clause 2 of the agreement ; namely, that though affirmatively put, it implies the negative and means that the District Board shall not take possession of the undertaking till the purchase is legally completed. Even accepting the aforesaid contentions, I do not think that the agreement goes beyond a contract between the parties on which the Court disposed of the application without granting any order of injunction. Of course, the formal order of disposal is there, but that does not convert the agreement into an undertaking to this Court. It is worthy of note that the order of 23-6-1950, as recorded, states clearly -- "It is agreed to by the parties etc." There is nothing to suggest that there is an undertaking given to the Court on the faith of which the Court is sanctioning a particular course of action or inaction. Mr. Das has con. tended that on the basis of the agreement the Court refrained from deciding the case on merits, and this would bring the agreement within the category of an undertaking on the faith of which the Court sanctioned a particular course of inaction, that is, refrained from deciding the case on merits, I agree that the Court refrained from deciding the case on merits ; but that does not necessarily mean that the Court did so on the faith of undertaking given to the Court. If Mr. Das's contention is correct, then, every action which is dismissed on compromise, without decision on merits, will give rise to a proceeding in contempt on a breach of a term of the compromise. I do not think that that is correct in law.