PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU & ORS.

83Copy pinpoint83. We shall now proceed to answer the issue No. 2 whether the High Court was justified in allowing the cross-appeal filed by the Original Defendant No. 2 on the ground that the settlement arrived at between the Appellants (Defendant No 1 and Defendant No. 2) was not valid and binding under Order XXIII Rule 3 of the CPC. H

68 SUPREME COURT REPORTS [2023] 5 S.C.R.

84Copy pinpoint84. Mr. Basant, learned Senior Counsel vehemently submitted that the settlement between the Defendant No. 1 and his sister i.e., the Defendant No. 2 was duly signed on affidavit way back on 29.03.1991. The said settlement was taken on record by the High Court on 9.04.1991 i.e., at the time of the final hearing of the first appeal. The first appeal came to be disposed of on 1.08.2000, modifying the decree to the extent of incorporating the terms of the compromise agreement between the two Defendants. It is only after a lapse of ten years that during the pendency of the appeal filed by the Appellants herein before the Division Bench of the High Court that the Defendant No. 2 thought fit to file cross-appeal, challenging the alleged compromise. Mr. Basant submitted that such cross-appeal is not maintainable and even if it held to be maintainable, the same should not have been entertained and allowed after the lapse of almost ten years from the date of recording of the settlement.

85Copy pinpoint85. We are not much impressed by the aforesaid submissions of D Mr. Basant. It is a settled position of law that right of appeal is the creature of statute. There is no inherent right of appeal. No appeal can be filed, heard or determined on merits unless the statute confers right on the appellant and power on the Court to do so. At this stage, we may look into the provisions of Order XLI Rule 22 of the CPC: E “22. Upon hearing respondent may object to decree as if he had preferred a separate appeal.—(1) Any respondent, though he may not have appealed from any part of the decree, may not only support the decree [but may also state that the finding against him in the Court below in respect of any issue ought to have been in his favour; and may also take any cross- F objection] to the decree which he could have taken by way of appeal provided he has filed such objection in the Appellate Court within one month from the date of service on him or his pleader of notice of the day fixed for hearing the appeal, or within such further time as the Appellate Court may see fit to allow. [Explanation.—A respondent aggrieved by a finding of the Court in the judgment on which the decree appealed against is based may, under this rule, file cross-objection in respect of the decree in so far as it is based on that finding, notwithstanding that by reason of the decision of the Court

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 69 & ORS. [J. B. PARDIWALA, J.]

on any other finding which is sufficient for the decision of the suit, the decree, is, wholly or in part, in favour of that respondent.] (2) Form of objection and provisions applicable thereto.— Such cross-objection shall be in the form of a memorandum, and the provisions of rule 1, so far as they relate to the form and contents of the memorandum of appeal, shall apply thereto. [3***] (4) Where, in any case in which any respondent has under this rule filed a memorandum of objection, the original appeal is withdrawn or is dismissed for default, the objection so filed may nevertheless be heard and determined after such notice to the other parties as the Court thinks fit. (5) The provisions relating to appeals by indigent persons shall, so far as they can be made applicable, apply to an objection under this rule.”

86Copy pinpoint86. The right to prefer cross-objection partakes of the right to prefer an appeal. The learned counsel appearing for the Defendant No. 2 (Respondent No. 2 herein) that a cross-appeal under Order XLI Rule 22 of the CPC is as effective as a regular first appeal and the same would sustain, even if, the regular first appeal is dismissed or withdrawn. A cross-appeal is the exercise of substantive right of appeal and only the procedure varies. (See: Urmila Devi and Others v. Branch Manager, National Insurance Company Limited and Another, (2020)11 SCC 316, para 16.) F

87Copy pinpoint87. Our attention was also drawn to the provisions of Order XLIII of Rule 1-A (2) of the CPC. The same reads as under: “1A. Right to challenge non-appealable orders in appeal against decrees.— Xxx xxx xxx G

(2) In an appeal against a decree passed in a suit after recording a compromise or refusing to record a compromise, it shall be open to the appellant to contest the decree on the ground that the compromise should, or should not, have been recorded.” H

70 SUPREME COURT REPORTS [2023] 5 S.C.R.

88Copy pinpoint88. We are of the view that the cross-appeal objector is entitled under Order XLI Rule 22 of the CPC read with Order XLIII Rule 1-A (2) of the CPC as referred to above, to make good the submission that she was entitled in law to question the legality and validity of the settlement agreement recorded under Order XXIII Rule 3 of the CPC by way of a cross-appeal. B

89Copy pinpoint89. In the aforesaid context, we may refer to the decision of this Court in the case of Banwari Lal v. Chando Devi (Smt) and Another reported in (1993) 1 SCC 581, more particularly, paras 9 to 13 resply therein: C “9. Section 96(3) of the Code says that no appeal shall lie from a decree passed by the Court with the consent of the parties. Rule 1-A(2) has been introduced saying that against a decree passed in a suit after recording a compromise, it shall be open to the appellant to contest the decree on the ground that the compromise should not have been recorded. D When Section 96(3) bars an appeal against decree passed with the consent of parties, it implies that such decree is valid and binding on the parties unless set aside by the procedure prescribed or available to the parties. One such remedy available was by filing the appeal under Order 43, Rule 1(m). E If the order recording the compromise was set aside, there was no necessity or occasion to file an appeal against the decree. Similarly a suit used to be filed for setting aside such decree on the ground that the decree is based on an invalid and illegal compromise not binding on the plaintiff of the second suit. But after the amendments which have been introduced, neither an appeal against the order recording the compromise nor remedy by way of filing a suit is available in cases covered by Rule 3-A of Order 23. As such a right has been given under Rule 1-A(2) of Order 43 to a party, who challenges the recording of the compromise, to question the validity thereof while preferring an appeal against the decree. Section 96(3) of the Code shall not be a bar to such an appeal because Section 96(3) is applicable to cases where the factum of compromise or agreement is not in dispute.

10. The learned counsel appearing for the respondent took a H stand that the High Court was justified in taking the view

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 71 & ORS. [J. B. PARDIWALA, J.]

that the suit had been simply withdrawn by the plaintiff- A appellant under Rule 1 of Order 23 and it had not been compromised in terms of Rule 3 of the said Order 23; as such there was no occasion for the appellant to file an application for recall of the said order and for restoration of the suit in question for being heard on merit. From the copy of the petition which was filed on February 27, 1991 it appears that the terms and conditions of settlement and agreement had been mentioned saying that both parties had entered into a compromise because of which the plaintiff-appellant had thereafter no connection with the disputed land and defendant-respondent shall be deemed to be in possession and the owner of the said disputed land. The prayer made in the said petition also says that the compromise may be ordered to be accepted. On basis of that petition, as already mentioned above, the court passed an order saying that the compromise had been accepted. In the order it has been mentioned that the suit of the plaintiff be “dismissed as per compromise deed Ex. C”. In view of the aforesaid facts and circumstances, it is difficult to hold that by order dated February 27, 1991 the Court allowed the suit to be withdrawn in terms of Rule 1 of Order 23. The order on face of it purported to dismiss the suit of the plaintiff on basis of the terms and conditions mentioned in the petition of compromise. As such, the validity of that order has to be judged treating it to be an order deemed to have been passed in purported exercise of the power conferred on the Court by Rule 3 of Order 23 of the Code. The learned Subordinate Judge should not have accepted the said petition of compromise even if he had no knowledge of the fraud alleged to have been practised on the appellant by his counsel, because admittedly the petition of compromise had not been signed either by the respondent or his counsel. This fact should have been discovered by the Court. In the case of Gurpreet Singh v. Chatur Bhuj Goel [(1988) 1 SCC 270 : AIR 1988 SC G 400] it has been said: (SCC p. 276, para 10) “Under Rule 3 as it now stands, when a claim in suit has been adjusted wholly or in part by any lawful agreement or compromise, the compromise must be in writing and signed by the parties and there must be a completed agreement H

72 SUPREME COURT REPORTS [2023] 5 S.C.R.

A between them. To constitute an adjustment, the agreement or compromise must itself be capable of being embodied in a decree. When the parties enter into a compromise during the hearing of a suit or appeal, there is no reason why the requirement that the compromise should be reduced in writing in the form of an instrument signed by the parties should be B dispensed with. The court must therefore insist upon the parties to reduce the terms into writing.” The requirement of the petition of compromise being signed by the parties concerned has been considered also in the case of Byram Pestonji Gariwala v. Union Bank of India [(1992) C 1 SCC 31 : AIR 1991 SC 2234] . It appears the attention of learned Judges was not drawn to the aforesaid case of this Court in Gurpreet Singh v. Chatur Bhuj Goel [(1988) 1 SCC 270 : AIR 1988 SC 400].

11. The present case depicts as to how on February 27, 1991 D the court recorded the alleged agreement and compromise in a casual manner. It need not be impressed that Rule 3 of Order 23 does not require just a seal of approval from the Court to an alleged agreement or compromise said to have been entered into between the parties. The statute requires the Court E to be first satisfied that the agreement or compromise which has been entered into between the parties is lawful, before accepting the same. Court is expected to apply its judicial mind while examining the terms of the settlement before the suit is disposed of in terms of the agreement arrived at between the parties. It need not be pointed out that once such a petition F of compromise is accepted, it becomes the order of the Court and acquires the sanctity of a judicial order.

12. On behalf of the respondent a stand was taken that the learned Subordinate Judge by his order dated September 20, 1991 could not have recalled the order dated February 27, G 1991 and restored the suit to its original number. It cannot be disputed that the respondent can support the order of the High Court setting aside order dated September 20, 1991 on any other reason than the reason given by the High Court.

13. When the amending Act introduced a proviso along with an explanation to Rule 3 of Order 23 saying that where it is

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 73 & ORS. [J. B. PARDIWALA, J.]

alleged by one party and denied by the other that an adjustment or satisfaction has been arrived at, “the Court shall decide the question”, the Court before which a petition of compromise is filed and which has recorded such compromise, has to decide the question whether an adjustment or satisfaction had been arrived at on basis of any lawful agreement. To make the enquiry in respect of validity of the agreement or the compromise more comprehensive, the explanation to the proviso says that an agreement or compromise “which is void or voidable under the Indian Contract Act …” shall not be deemed to be lawful within the meaning of the said Rule. In view of the proviso read with the explanation, a Court which had entertained the petition of compromise has to examine whether the compromise was void or voidable under the Indian Contract Act. Even Rule 1(m) of Order 43 has been deleted under which an appeal was maintainable against an order recording a compromise. As D such a party challenging a compromise can file a petition under proviso to Rule 3 of Order 23, or an appeal under Section 96(1) of the Code, in which he can now question the validity of the compromise in view of Rule 1-A of Order 43 of the Code.” (Emphasis supplied)

90Copy pinpoint90. We may also refer to and rely upon the decision of this Court E in the case Vipan Aggarwal and Another v. Raman Gandotra and Others reported in 2022 SCCOnLine SC 1357 more particularly paras 4 and 5 resply therein: “4. This Court in a judgment reported in ‘Banwari Lal v. Chando Devi (Smt.) (Through LRS.)’ (1993) 1 SCC 581 held F the question as to whether an aggrieved person against the compromise decree has a right to file an application before the Court which granted the decree or an appeal in terms of Order 43 Rule 1A of the Civil Procedure Code, 1908 (for short, ‘the CPC’). It was held as under:— G “13. When the amending Act introduced a proviso along with an explanation to Rule 3 of Order 23 saying that where it is alleged by one party and denied by the other that an adjustment or satisfaction has been arrived at, “the Court shall decide the question”, the Court before which a H

74 SUPREME COURT REPORTS [2023] 5 S.C.R.

A petition of compromise is filed and which has recorded such compromise, has to decide the question whether an adjustment or satisfaction had been arrived at on basis of any lawful agreement. To make the enquiry in respect of validity of the agreement or the compromise more comprehensive, the explanation to the proviso says that an agreement or compromise “which is void or voidable under the Indian Contract Act…” shall not be deemed to be lawful within the meaning of the said Rule. In view of the proviso read with the explanation, a Court which had entertained the petition of compromise has to examine whether the compromise was void or voidable under the Indian Contract Act. Even Rule 1(m) of Order 43 has been deleted under which an appeal was maintainable against an order recording a compromise. As such a party challenging a compromise can file a petition under proviso to Rule 3 of Order 23, or an appeal under Section 96(1) D of the Code, in which he can now question the validity of the compromise in view of Rule 1-A of Order 43 of the Code.”

5. The appellants had thus the right to avail either the remedy of appeal in terms of Order 43 Rule 1A CPC or by way of an E application before the court granting decree. Therefore, the application filed by the appellants before the Court which granted the decree cannot be said to be without jurisdiction.” (Emphasis supplied)

91Copy pinpoint91. Thus, in view of the aforesaid discussion, we hold that the cross-appeal filed by the Original Defendant No. 2, questioning the legality and validity of the settlement was maintainable in law.

92Copy pinpoint92. We shall now look into the circumstances, as highlighted by the learned Senior Counsel appearing for the Defendant No. 2, rendering G the settlement agreement dated 28.03.1991 invalid and not binding under Order XXIII Rule 3 of the CPC: “First, the alleged compromise agreement has admittedly not been signed by the plaintiff who concededly has a share in the property as a coparcener. A written consent of all parties is necessary. H

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 75 & ORS. [J. B. PARDIWALA, J.]

Secondly, a coparcenary undivided property in specie (Plot A No. 140) has been allotted to Defendant 2 by Defendant No. 1 over which the plaintiff also has an interest. Thirdly, there is variance between the agreement and the compromise petition producing the agreement. The Variance noted is as follows- B

(a) The compromise petition takes in consideration yet another property already purchased by Defendant No. 2 by her own income (Schedule B property) which was not a part of compromise agreement. C (b) The sketch map appended to the petition shows plot no. 1086 and 1085 which for part of plot No. 141 instead of plot no. 140 mentioned in clause 3 of compromise agreement, and does not indicate any consensus ad idem, therefore, the execution of the compromise agreement becomes unenforceable. D (c) The species of suit property, which was given/provided to Defendant no.2 in clause 3 (page 141) of agreement was changed to will be allotted to her in final decree proceeding. (d) The payment of Rs. 12000 which was to be deposited to E court without any caveat in agreement (See para 4 @ 141) was made subject to further orders of the Court in the petition. (e) There is no express mentioning about the mesne profits in agreement whereas a definite clause was inserted in the compromise petition. F (f) The easement rights to property of Defendant No. 2 were recognised in agreement and later in petition was altered to that Defendant No. 2 along with others have to file and take steps to easement rights for which the Defendant 1 shall not object. G (h) The agreement provided that the defendant no. 2 shall sign the compromise petition which was later altered to signing and swearing the affidavit in compromise petition. Fourthly, the judgment dated 01.08.2000 of the first appellate court accepting the compromise does not make allotment of H

76 SUPREME COURT REPORTS [2023] 5 S.C.R.

A the property allotted in specie to the Defendant No. 2. The first appellate court has proceeded on the wrong premise that the Defendant No. 2 has surrendered her rights to the Defendant No. 1. The first appellate court was further wrong in specifically noting that the compromise agreement does not cause any prejudice to the rights of the plaintiff and therefore can be given effect. Fifthly, the compromise agreement was entered into by beckoning a smaller share to the Defendant No. 2, while she has a larger share in view of Vineeta Sharma (supra). The consideration for the alleged compromise/settlement was therefore inadequate and whole agreement has to fall to the ground due to changed and supervening circumstances effectuated by change in law. Lastly, even otherwise, the allotment of a co-ownership property in a specie to one coparcener cannot be modified in D a preliminary decree. Moreover, under Hindu Law, the gift/ renunciation/relinquishment or alienation by one coparcener of his undivided coparcenary interest to another coparcener without consent of other coparceners is void.”

93Copy pinpoint93. It is now well settled that under Order XXIII Rule 3 of the E CPC as it now stands, when a claim in suit has been adjusted wholly or in part by any lawful agreement or compromise, the compromise must be in writing and signed by the parties and there must be a completed agreement between them. To constitute an adjustment, the agreement or compromise must itself be capable of being embodied in a decree. F (See: Gurpreet Singh v. Chatur Bhuj Goel, (1988) 1 SCC 270.)

94Copy pinpoint94. Indisputably, in the case on hand, the plaintiff has not put her signature on the deed of settlement, which was produced before the High Court in first appeal. The Plaintiff has made herself very clear that she never joined in the settlement between her brother i.e., the Defendant G No. 1 and her sister i.e., the Defendant No. 2. On this ground alone, the settlement could be said to be unlawful, being without any written consent of all the parties. In a suit for partition of joint property, a decree by consent amongst some only of the parties cannot be maintained.

95Copy pinpoint95. In Nityamoni Dasi v. Gokul Chandra Sen reported in (1911) 9 Ind Cas 210 (Cal), the Calcutta High Court observed: H

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 77 & ORS. [J. B. PARDIWALA, J.]

“… The decree of the Subordinate Judge must be set aside and the whole case retried, because as this is a suit for partition of joint property, a decree by consent amongst some only of the parties cannot possibly be maintained…..”

96Copy pinpoint96. In Vir Singh and Others v. Kharak Singh and Others reported in AIR 1925 Lah 280, all the proprietors had not assented to the compromise, Moti Sagar, J. observed:— “…the alleged compromise not having been assented to by all the proprietors was clearly contrary to law and the Court was, therefore, fully justified in refusing to enforce it. …”

97Copy pinpoint97. In Taraprasanna Sarkar and Another v. Kalikamohan C Sarkar and Others reported in AIR 1924 Cal 80 Mookerjee and Rankin, JJ., held:— “…There can be no compromise binding upon, all the parties to a partition suit until and unless all the parties have joined in the compromise:…” D

98Copy pinpoint98. In the aforesaid context, we shall also now look into the findings recorded by the Division Bench of the High Court while allowing the cross-appeal filed by the Defendant No. 2. We quote the relevant observations as under: E “The appeal was filed by defendant no. 1 before this Court. In this Appeal challenging the correctness of the decision of the learned Single Judge in F.A. No. 359/96 on the basis of the compromise petition dated 28.3.1991, which is flied and accepted by him is not signed by defendant no.2 and the same is signed by her advocate and not signed by the plaintiff and her counsel. Therefore, it is urged that the same is not legal compromise as provided under Order 23, Rule 3, CPC and on behalf of defendant no.2 her advocate could not have signed the compromise petition as she has not executed special ‘vakalatnama’ giving the authorization in favour of her lawyer to compromise the matter between defendant no.1 and 2 In the First Appeal. Therefore, First Appellate Judge should not have received the compromise petition and accepted the same. The acceptance of the compromise petition by the learned Single Judge should have entered between the parties including the plaintiff. In support of the said legal contention, H

78 SUPREME COURT REPORTS [2023] 5 S.C.R.

A reliance is placed by the learned counsel on behalf of defendant no.2 on the decisions of the apex Court in Ramasrey & Puspa Devi (supra). The compromise petition is in variance to the schedule properties of the suit and, therefore, it is voidable. The compromise was neither recorded by the first appellate court at the time-of filing compromise petition in B writing, nor the parties were present in the court nor signed the petition in court. Therefore, the alleged compromise cannot be termed as compromise between the parties in relation to the subject matter covered therein as the same is illegal for the reason that it is opposed to Order 23, Rule 3, CPC. Hence C the learned Single Judge could not have accepted the same. In support of this contention, learned Single Judge had rightly placed reliance upon the decisions of the Hon’ble Supreme Court In the case of Gurpreet Singh v. Chatur Bhuj Goel, AIR 1988 SC 400; and of this Court in the case of Sanyasi Jena and others v. Mina Jena and others, AIR 1984 Orissa D

213. Further the reliance placed by the learned counsel for the defendant no.1 upon the judgment of Puspa Devi (supra) is distinguished by defendant no.2 counsel stating that compromise petition is being typed in English. Further the same is not signed by defendantno.2. Defendant no.1 with a E view to deprive allotment of share assigned in favour of defendant no.2 by the trial court in respect of the suit schedule properties in the absence of signing the compromise petition by defendant no.2 and there is no special ‘vakalatnama’ executed in favour of her lawyer, the said compromise petition is unlawful and the same could not have been accepted by the first appellate court In the Impugned judgment and modified the trial court judgment. Therefore, the cross- objection/appeal filed by defendant no.2 has to be allowed by setting aside the compromise recorded by the first appellate court In the Impugned judgment by modifying trial court judgment in relation to the share of the defendant no.2 allotted in respect of the suit schedule properties. Having set aside the said compromise, as recorded in the impugned judgment of the First Appellate Court, the trial court judgment is restored with regard to the share assigned by him in favour in of defendant no.2 In respect of suit schedule properties. H

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 79 & ORS. [J. B. PARDIWALA, J.]

Accordingly the cross-objection of the second defendant is allowed by answering the aforesaid point no.(iii) in her favour.” (Emphasis supplied)

99Copy pinpoint99. We are in complete agreement with the aforesaid findings recorded by the High Court in its impugned judgment and order while allowing the cross-appeal.

100Copy pinpoint100. The third question that arises for our consideration in context with the legality and validity of the settlement is whether the learned advocate appearing for the cross-objector i.e., Defendant No. 2 could have signed the compromise petition without an express consent. It is an imperative duty of the Court to ascertain the genuineness and lawfulness of the compromise deed. Indisputably, in the case on hand, the First Appellate Court had neither recorded the statements of the parties in the Court nor had made any inquiry into the terms of the settlement. It is in such circumstances that the High Court in its impugned order has observed that the Compromise Petition was signed by the advocate without any express authority or without special vakalatnama executed in favour of the advocate. In fact, the authority was expressly curtailed in the compromise deed.

101Copy pinpoint101. In the aforesaid context, we may refer to the decision of this E Court in the case of Himalayan Cooperative Group Housing Society v. Balwan Singh and Others reported in (2015) 7 SCC 373, more particularly, paras 22 to 33, which read thus: “22. Apart from the above, in our view lawyers are perceived to be their client’s agents. The law of agency may not strictly apply to the client-lawyer’s relationship as lawyers or agents, lawyers have certain authority and certain duties. Because lawyers are also fiduciaries, their duties will sometimes be more demanding than those imposed on other agents. The authority-agency status affords the lawyers to act for the client on the subject-matter of the retainer. One of the most basic principles of the lawyer-client relationship is that lawyers owe fiduciary duties to their clients. As part of those duties, lawyers assume all the traditional duties that agents owe to their principals and, thus, have to respect the client’s autonomy to make decisions at a minimum, as to the objectives of the H

80 SUPREME COURT REPORTS [2023] 5 S.C.R.

A representation. Thus, according to generally accepted notions of professional responsibility, lawyers should follow the client’s instructions rather than substitute their judgment for that of the client. The law is now well settled that a lawyer must be specifically authorised to settle and compromise a claim, that merely on the basis of his employment he has no implied or ostensible authority to bind his client to a compromise/settlement. To put it alternatively that a lawyer by virtue of retention, has the authority to choose the means for achieving the client’s legal goal, while the client has the right to decide on what the goal will be. If the decision in question falls within those that clearly belong to the client, the lawyer’s conduct in failing to consult the client or in making the decision for the client, is more likely to constitute ineffective assistance of counsel.

23. The Bar Council of India Rules, 1975 (for short “the BCI D Rules”), in Part VI Chapter II provide for the “Standards of Professional Conduct and Etiquette” to be observed by all the advocates under the Advocates Act, 1961 (for short “the 1961 Act”). In the Preamble to Chapter II, the BCI Rules provide as follows: E “An advocate shall, at all times, comport himself in a manner befitting his status as an officer of the Court, a privileged member of the community, and a gentleman, bearing in mind that what may be lawful and moral for a person who is not a member of the Bar, or for a member of the Bar in his non-professional capacity may still be improper for an advocate. Without prejudice to the generality of the foregoing obligation, an advocate shall fearlessly uphold the interests of his client and in his conduct conform to the rules hereinafter mentioned both in letter and in spirit. The rules hereinafter mentioned contain canons of conduct and etiquette adopted as general guides; yet the specific mention thereof shall not be construed as a denial of the existence of others equally imperative though not specifically mentioned.”

24. The Preamble makes it imperative that an advocate has to conduct himself and his duties in an extremely responsible

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 81 & ORS. [J. B. PARDIWALA, J.]

manner. They must bear in mind that what may be appropriate and lawful for a person who is not a member of the Bar, or for a member of the Bar in his non-professional capacity, may be improper for an advocate in his professional capacity.

25. Section II of the said Chapter II provides for duties of an advocate towards his client. Rules 15 and 19 of the BCI Rules, B have relevance to the subject-matter and therefore, they are extracted below: “15. It shall be the duty of an advocate fearlessly to uphold the interests of his client by all fair and honourable means without regard to any unpleasant consequences to himself C or any other. He shall defend a person accused of a crime regardless of his personal opinion as to the guilt of the accused, bearing in mind that his loyalty is to the law which requires that no man should be convicted without adequate evidence. D ***

19. An advocate shall not act on the instructions of any person other than his client or his authorised agent.”

26. While Rule 15 mandates that the advocate must uphold the interest of his clients by fair and honourable means without regard to any unpleasant consequences to himself or any other. Rule 19 prescribes that an advocate shall only act on the instructions of his client or his authorised agent. Further, the BCI Rules in Chapter I of the said Section II provide that the Senior Advocates in the matter of their practice of the profession of law mentioned in Section 30 of the 1961 Act would be subject to certain restrictions. One of such restrictions contained in clause (cc) reads as under: “(cc) A Senior Advocate shall, however, be free to make concessions or give undertaking in the course of arguments on behalf of his clients on instructions from the junior advocate.”

27. Further, the “Code of Ethics” prescribed by the Bar Council of India, in recognition of the evolution in professional and ethical standards within the legal community, H

82 SUPREME COURT REPORTS [2023] 5 S.C.R.

A provides for certain rules which contain canons of conduct and etiquette which ought to serve as general guide to the practice and profession. Chapter III of the said Code provides for an “Advocate’s duty to the client”. Rule 26 thereunder mandates that an “advocate shall not make any compromise or concession without the proper and specific instructions of his/her client”. It is pertinent to notice that an advocate under the Code expressly includes a group of advocates and a law firm whose partner or associate acts for the client.

28. Therefore, the BCI Rules make it necessary that despite the specific legal stream of practice, seniority at the Bar or designation of an advocate as a Senior Advocate, the ethical duty and the professional standards insofar as making concessions before the Court remain the same. It is expected of the lawyers to obtain necessary instructions from the clients or the authorised agent before making any concession/ D statement before the court for and on behalf of the client.

29. While the BCI Rules and the Act, do not draw any exception to the necessity of an advocate obtaining instructions before making any concession on behalf of the client before the court, this Court in Periyar & Pareekanni Rubber Ltd. v. State of E Kerala [(1991) 4 SCC 195] has noticed the sui generis status and the position of responsibility enjoyed by the Advocate General in regard to the statements made by him before the courts. The said observation is as under: (SCC p. 209, para 19)

F “19. … Any concession made by the Government Pleader in the trial court cannot bind the Government as it is obviously, always, unsafe to rely on the wrong or erroneous or wanton concession made by the counsel appearing for the State unless it is in writing on instructions from the responsible officer. Otherwise it would place undue and G needless heavy burden on the public exchequer. But the same yardstick cannot be applied when the Advocate General has made a statement across the Bar since the Advocate General makes the statement with all responsibility.” H

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 83 & ORS. [J. B. PARDIWALA, J.]

(See: Joginder Singh Wasu v. State of Punjab [(1994) 1 A SCC 184] .)

30. The Privy Council in Sourendra Nath Mitra v. Tarubala Dasi [(1929-30) 57 IA 133 : (1930) 31 LW 803 : AIR 1930 PC 158] , has made the following two observations which hold relevance to the present discussion: (IA pp. 140-41) B “Two observations may be added. First, the implied authority of counsel is not an appendage of office, a dignity added by the courts to the status of barrister or advocate at law. It is implied in the interests of the client, to give the fullest beneficial effect to his employment of the advocate. Secondly, C the implied authority can always be countermanded by the express directions of the client. No advocate has actual authority to settle a case against the express instructions of his client. If he considers such express instructions contrary to the interests of his client, his remedy is to return his brief.” D (See: Jamilabai Abdul Kadar v. Shankarlal Gulabchand [(1975) 2 SCC 609] and Svenska Handelsbanken v. Indian Charge Chrome Ltd. [(1994) 2 SCC 155] )

31. Therefore, it is the solemn duty of an advocate not to transgress the authority conferred on him by the client. It is always better to seek appropriate instructions from the client or his authorised agent before making any concession which may, directly or remotely, affect the rightful legal right of the client. The advocate represents the client before the court and conducts proceedings on behalf of the client. He is the only link between the court and the client. Therefore his responsibility is onerous. He is expected to follow the instructions of his client rather than substitute his judgment.

32. Generally, admissions of fact made by a counsel are binding upon their principals as long as they are unequivocal; where, however, doubt exists as to a purported admission, the court should be wary to accept such admissions until and unless the counsel or the advocate is authorised by his principal to make such admissions. Furthermore, a client is not bound by a statement or admission which he or his lawyer was not authorised to make. A lawyer generally has no implied H

84 SUPREME COURT REPORTS [2023] 5 S.C.R.

A or apparent authority to make an admission or statement which would directly surrender or conclude the substantial legal rights of the client unless such an admission or statement is clearly a proper step in accomplishing the purpose for which the lawyer was employed. We hasten to add neither the client nor the court is bound by the lawyer’s statements or admissions as to matters of law or legal conclusions. Thus, according to generally accepted notions of professional responsibility, lawyers should follow the client’s instructions rather than substitute their judgment for that of the client. We may add that in some cases, lawyers can make decisions without consulting the client. While in others, the decision is reserved for the client. It is often said that the lawyer can make decisions as to tactics without consulting the client, while the client has a right to make decisions that can affect his rights.

D 33. We do not intend to prolong this discussion. We may conclude by noticing a famous statement of Lord Brougham: “an advocate, in the discharge of his duty knows but one person in the world and that person is his client”. [Ed.: The statement was made by Mr Henry Brougham, as His E Lordship then was, while defending Queen Caroline in the House of Lords. See The Whole Proceedings on The Trial of Her Majesty, Caroline Amelia Elizabeth, Queen of England, for “Adulterous Intercourse” with Bartolomeo Bergami, Vol. II, p. 2 containing Her Majesty’s Defence, printed and published by John Fairburn, Broadway, F Ludgate Hill (1820).]” (Emphasis supplied)

102Copy pinpoint102. We also refer to the decision of this Court in the case of Byram Pestonji Gariwala (supra), more particularly, the observations G made in para 37, which read thus: “37. We may, however, hasten to add that it will be prudent for counsel not to act on implied authority except when warranted by the exigency of circumstances demanding immediate adjustment of suit by agreement or compromise and the signature of the party cannot be obtained without undue H

PRASANTA KUMAR SAHOO & ORS. v. CHARULATA SAHU 85 & ORS. [J. B. PARDIWALA, J.]

delay. In these days of easier and quicker communication, such contingency may seldom arise. A wise and careful counsel will no doubt arm himself in advance with the necessary authority expressed in writing to meet all such contingencies in order that neither his authority nor integrity is ever doubted. This essential precaution will safeguard the personal reputation of counsel as well as uphold the prestige and dignity of the legal profession.” (Emphasis supplied)

103Copy pinpoint103. Almost six decades back, the Madras High Court speaking through Justice Ramaswami (as His Lordship then was) in the case of C Govindammal v. Marimuthu Maistry and Others reported in AIR 1959 Mad 7 had sounded the note of caution observing as under: “5. … The decisions appear to be fairly clear that even in cases where there is no express authorization to enter into a compromise, under the inherent authority impliedly given to the Vakil he has power to enter into the compromise on behalf of his client. But in the present state of the clientele world and the position in which the Bar now finds itself and in the face of divided judicial authority and absence of statutory backing prudence dictates that unless express power is given in the vakalatnama itself to enter into compromise, in accordance with the general practice obtaining a special vakalatnama should be filed or the specific consent of the party to enter into the compromise should be obtained. If an endorsement is made on the plaint etc., it would be better to get the signature or the thumb impression of the party affixed thereto, making it evident that the party is aware of what is being done by the Vakil on his or her behalf.”

104Copy pinpoint104. Thus, in view of the aforesaid discussion, we hold that the High Court committed no error in holding that the settlement between the Defendant Nos. 1 and 2 resply was unlawful. G OUR FINAL CONCLUSIONS

105Copy pinpoint105. We may draw our final conclusions as under: (i) The preliminary decree drawn by the Trial Court as affirmed by the High Court is modified to the extent that the daughters H

86 SUPREME COURT REPORTS [2023] 5 S.C.R.

A are entitled to 1/3rd share in all the properties scheduled in the plaint i.e., ancestral and self-acquired properties of Late Shri Kumar Sahoo. The Trial Court shall modify the decree accordingly. (ii) As we have held that the settlement between the Original B Defendant Nos. 1 and 2 resply was not in accordance with law, the Appellants herein will not be entitled to the share of the Original Defendant No. 2. (iii) The Appellants shall be entitled to only their 1/3rd share in the suit properties. C (iv) Since the Defendant No. 1 was appointed as receiver, the Appellants shall now furnish accounts before the Trial Court.

106Copy pinpoint106. With the aforesaid clarifications, both the Appeals fail and are hereby dismissed.

107Copy pinpoint107. This litigation by now is almost four decades old. The Original Plaintiff as on date is almost 85 years of age. In such circumstances, the Trial Court shall draw the final decree within a period of three months from the date of receipt of the certified copy of this judgment and order.

108Copy pinpoint108. Parties to bear their own costs.

109Copy pinpoint109. Pending applications, if any, also stand disposed of.

Divya Pandey Appeals dismissed. (Assisted by : Shevali Monga, LCRA)