Novartis Ag vs Wander Pvt. Ltd.
2004 Latest Caselaw 1046 Del

JUDGMENT

Mukul Mudgal, J.

1. By this application the defendant is seeking extension of time to perform certain obligations in respect of settlement between the parties dated 20th August, 2002 approved by this Court. It is not in dispute that the settlement was arrived at by virtue of a joint application by the parties under Order XXIII Rule 3 CPC. The principal submission of Mr. Chandhiok, learned counsel for the applicant/defendant is that he is seeking extension of time only by 12 days to comply with the conditions imposed by the said terms of settlement. Thus the question of law which has been raised and arises for determination is the power of this Court to extend the time and alter terms of settlement between the parties notwithstanding the opposition by one of the parties to the settlement. The learned senior counsel for the applicant Mr. Chandhiok has relied upon provisions of Section 148 CPC to contend that where any period is fixed or granted by the Court for the doing of any act prescribed or allowed by the Code, the court may, in its discretion, from time to time, enlarge such period, even though the originally fixed period may have expired. Section 148 CPC reads as follows:-

"148. Enlargement of time - Where any period is fixed or granted by the Court for the doing of any act prescribed or allowed by this Code, the Court may, in its discretion, from time to time, enlarge such period, [not exceeding thirty days in total] even though the period originally fixed or granted may have expired."

2. He states that the phrase 'any period fixed or granted by this Court' used in Section 148 need not be fully governed by the doing of any act prescribed or allowed by this Code and would also include a situation such as the present case. He has also relied on the judgment of Supreme Court in Smt. Periyakkal and others vs. Smt. Dakshyani, , the relevant portion of which reads as follows:-

"True, the Court would not re-write a contract between the parties but the Court would relieve against a forfeiture clause; And, where the contract of the parties has merged in the order of the Court, the Court's freedom to act to further the ends of justice would surely not stand curtailed. Nothing said in Hukamchand's case militates against this view. We are, therefore, of the view that the High Court was in error in thinking that they had no power to extend time. Even so, Shri Jawali submitted that this was not an appropriate case for granting any extension of time. We desire to express no opinion on that question. The High Court will decide that question. We accordingly, set aside the judgment dated 15th January, 1979 of the High Court and direct the High Court to dispose of I.A. No. VII in Execution Second Appeal No. 89/74 afresh in accordance with law. The parties will bear their own costs."

He has contended that the above judgment applies to the present case on the ground that the dicta of law laid down by the Supreme Court to the effect that where the contract of parties merges in the order of the Court, the Court's power or freedom to act further the ends of justice would not stand curtailed.

3. He has further relied upon the judgment of Calcutta High Court in Smt. Mangala Ghosh vs. Rabindra Nath Hazra, and in particular paragraph No. 17 of the judgment which reads as under:

"17. Therefore, relying upon the decisions and and also following the decision in Tapan Kr. Chatterjee's case (supra) as in my view the decision in Sunity Chandra Bose's case (supra) is not in conflict with the Tapan Kumar Chatterjee's case (supra) on the point that under S. 28 of the Specific Relief act, 1963, the Court can extend the time for deposit of the purchase-money or balance of the purchase-money, I hold that upon an application made by a party the Court can extend the time stipulated in the compromise petition upon which the consent decree has been passed in a suit for specific performance of contract, even without any consent of the other party, as in such a case the time so stipulated is not the essence of the contract and is a penal clause and such time becomes part of the Court's order and the Court is empowered to relieve the party concerned of the rigours of such penal clause in appropriate cases."

4. Mr. Mukul Rohtagi, learned senior counsel for the plaintiff while opposing this application has contended that the position of law is well settled in this Court by the judgment of the learned Single Judge in Pioneer Engineering Co. vs. D.H. Machine Tools, AIR 1986 DELHI 165 and by the judgment of the Division Bench in Creative Travels Pvt. Ltd. and Anr. vs. Joginder Singh Palta, 1993(52) DLT 371, wherein the Division Bench of this Court by referring to the judgment of the Hon'ble Supreme Court in Smt. Periyakkal's case( supra) found the judgment inapplicable and applied the judgment of the Supreme Court in Hukamchand vs. Bansilal and others, .

5. In my view, the learned Single Judge of this Court in Pioneer Engineering (supra) had squarely dealt with the issue whether a compromise decree arrived at between the parties by virtue of an application under Order XXIII Rule 3 of the Civil Procedure Code the Court could have alleged the time agreed to by the parties and held that the Court did not have jurisdiction under Section 148 CPC. Thus this decision which also refers to and explains the judgment of the Supreme Court in Smt. Periyakkal's case (supra) is clearly and directly on the issue involved in the present case. The relevant position of law laid down by the learned Single Judge reads as under:-

"15. In Smt. Periyakkal v. Smt. Dakshyani, the respondent had obtained a money decree against the appellant. Later in execution of that decree certain property belonging to the appellant was brought to sale and the decree-holder herself purchased that property for Rs.28,000/-. The appellant filed an application for setting aside the sale. The execution Court dismissed the application but on appeal the sale was set aside. The respondent-holder filed second appeal in the High Court. At the hearing of that appeal the parties entered into a compromise whereby the judgment debtor agreed to deposit and the decree-holder agreed to receive a sum of Rs.60,000/- in full and final settlement of the decree. It was further agreed that if the deposit of the aforesaid amount was made on or before 1976 the sale was to stand set aside and the second appeal of the respondent was to stand dismissed. It was also agreed that if the amount of Rs.60,000/- was not deposited on or before the date fixed the second appeal was to stand allowed and the sale was to stand confirmed. The time was stated to be the essence of the contract between the parties. The judgment debtors failed to deposit the agreed amount within the stipulated time. They later filed an application under S. 148 of the Code in the High Court for extension of time for deposit of Rs.60,000/- in terms of the compromise. The High Court dismissed the application on the ground that the Court could not extend time where the time had been stipulated by the parties themselves in the compromise arrived at between them. The Supreme Court reversed that finding. In that judgment time was not fixed under a decree but during the course of execution proceedings it was held that the time for deposit stipulated by the parties became the time allowed by the Court and this gave the Court jurisdiction to extend time in appropriate cases. It was held that the Court had jurisdiction and the matter was remanded by the Supreme Court.

. .... .... ....

There are thus mutual obligations under the decree and the time of three months is the essence of the contract which is the basis of compromise decree. Although the time was granted by the Court under the decree but it was not an act prescribed or allowed by any provision of the C.P.C. or the rules made there under. It is held that S. 148 of the Code is not applicable and the Court under this section has no jurisdiction to extend the time fixed for the performance of an obligation under the compromise decree."

6. Mr. Chandhiok has attempted to persuade me that this is not the correct position of law. He submitted that the Single Judge did not appreciate the correct position of law laid down by the Supreme Court to the effect that the time was fixed by the Court based upon the terms of settlement and the Court could enlarge such time without consent of one of the parties. I am of the view that the law laid down in the above judgment of learned single Judge is binding on me unless I am persuaded to the contrary in which case the only course left to me to refer the matter to the Division Bench after recording my views.

7. The Division Bench of this Court in Creative Travel's case (supra) after finding the judgment of Supreme Court in Periyakkal's case (supra) inapplicable, relied upon the judgment of Supreme Court in Hukamchand's case (supra). The learned Judges noticed the fact that during the appeal, a compromise was arrived at. The Division Bench thus held as follows:-

"(13) In the present case also there is a decree for possession in favor of the respondent which was liable to be executed immediately but for the consent of the parties who had agreed that the execution should be deterred till after 31st October, 1993. This agreement was arrived at when the compromise was recorded in this Court on 15th May, 1993. Just as in the Hukamchand's case, with the disposal of the application under Order Xxi Rule 90 the sale was bound to be confirmed, similarly with the disposal of this appeal the execution of the decree had to follow but just as in Hukamchand's case, with the consent of the parties; the date of execution was postponed, similarly in the present case, with the consent of the parties the date of execution has been postponed till after 31st October, 1993. In Smt. Periyakkal's case however, the question was with regard to deposit of money within the time stipulated. We find that the present case is squarely covered by the decision of a larger Bench of the Supreme Court in the case of Shri Hukamchand (supra) and, therefore, we have no hesitation in coming to the conclusion that this Court has no jurisdiction to extend the time in the absence of the consent of either of the parties. It is to be borne in mind that when litigation is brought to an end by the parties agreeing to certain terms, it would be unfair and unjust for the Court to pass orders, subsequently and without their consent, which would be at variance with the terms of the agreement. In Periyakkal case it was observed that "The Court would not rewrite contract between the parties....." When there is a term in the agreement that if the premises are not vacated by 31st October, 1993 the Court decree would be executed and an undertaking to this effect is furnished, in our opinion that term of agreement cannot be unilaterally altered and th undertaking not acted upon. The parties avoided judgment at the time when the compromise was arrived at. A solemn undertaking was given to this Court that the premises will be vacated by 31st October, 1993. Had the time been fixed for vacating the premises without the consent of the parties, and merely by orders of the Court, there would have been no difficulty for the Court in granting extension. We do feel that the facts as made out in the application give sufficient reasons for extending the time because it appears that the applicants are constructing another house but with the respondent not giving his consent to the extension of any time this Court, in view of the decision of the Supreme Court in Hukamchand's case has no jurisdiction to entertain a request for enlargement of time. For the aforesaid reasons this application is dismissed."

8. The above position of law laid down by the Division Bench clearly states that without the consent of the parties, it is not possible to grant extension of time even though there was cause made out for granting of extension of time. Mr. Chandhiok has attempted to distinguish the the judgment of the Division Bench as not binding on the ground that the dicta of law in Periyyakal's case (supra) extracted above holding that once the contract of the parties is merged in the court's order, the Court's power to act to further the ends of justice would not stand curtailed, to contend that the Division Bench has not correctly applied and wrongly distinguished Periyyakal's case. In my view the Division Bench having noticed the judgment in Periyyakal and distinguished it and thereafter taken the aforesaid view, it is not open for me sitting as a Single Judge to take a view contrary to the view taken by the Division Bench. A plea as to whether or not the decision of Division Bench is not in consonance with the law laid down by the Supreme Court, can not be raised before this Court particularly when the Division Bench noticed the position of law laid down by the Supreme Court in Periyyakal's case (supra).

9. Following the view of the Division Bench and the Single Judge of this Court, I am of the view that this Court has no jurisdiction to enlarge the time under Section 148 CPC in respect of time granted or condition prescribed in a compromise petition forming the basis of a Court order under Order XXIII Rule 3 CPC.

10. This application is accordingly dismissed. A copy of the order be given dusty under the signatures of the Court Master/Private Secretary.