Krishna Kumar Ojha v. Jitendra Chaudhary (2026): a compromise decree needs the party's signature, not just counsel's

On 1 July 2026, a Bench of Justices Sanjay Karol (who authored the opinion) and Nongmeikapam Kotiswar Singh decided Krishna Kumar Ojha & Ors. v. Jitendra Chaudhary & Ors. (2026 INSC 662), dismissing an appeal against orders of the Trial Court and the High Court of Judicature at Patna that had set aside a 1994 compromise decree in an old partition suit and reopened the matter for full trial. The decision is a compact restatement of two things that repeatedly go wrong in compromise litigation: what Order XXIII Rule 3 of the Code of Civil Procedure, 1908, actually requires, and how far a lawyer may go on his client's behalf.

The facts

In 1989, one Dinbandhu Ojha filed a partition suit seeking a one-fourth share in the property of a common ancestor, Thakur Ojha. Chaturbhuj Chaudhary, arrayed as defendant no. 5 and said to be a predecessor of the present respondents, appeared through counsel on summons. During the pendency of the suit a compromise petition was filed — described as filed jointly by the plaintiffs and defendants — and was accepted by the Sub-Judge-01, Muzaffarpur, by order dated 22 February 1994. A final decree followed on 27 May 1997.

For roughly a quarter of a century nothing happened. Then, on 7 April 2022, the legal representatives of defendant no. 5 filed Miscellaneous Case No. 07 of 2022 seeking to set aside the compromise decree, on the ground that it had been obtained by fraud and without the signature of defendant no. 5. The Trial Court allowed that application on 7 February 2024; the High Court dismissed the appeal against it. The heirs of the original plaintiffs and other co-sharers then came to the Supreme Court.

The question

The Court framed a single, narrow issue: whether the compromise accepted by the Civil Court on 22 February 1994 satisfied Order XXIII Rule 3 CPC. Its answer was that it did not.

Rule 3 permits a decree on compromise only where the Court is satisfied that the suit has been adjusted "wholly or in part by any lawful agreement or compromise in writing and signed by the parties." An Explanation adds that an agreement void or voidable under the Indian Contract Act, 1872, is not "lawful" for this purpose. Surveying its own precedent, the Court distilled the settled position: before the 1976 amendment a compromise could be oral or written, but after it a compromise must be in writing and signed by the parties (Gurpreet Singh v. Chatur Bhuj Goel; Som Dev v. Rati Ram); the signature of all parties is a mandate of law; the compromise must be voluntarily accepted; and the Court's role is not merely to record but to apply its judicial mind to the terms and ensure they are lawful (Banwari Lal v. Chando Devi).

The limits of an advocate's authority

The compromise furnished to the Court recorded that there was "no objection" on behalf of defendant no. 5 — but that statement came through his counsel, whose vakalatnama was dated 27 August 1992. The crucial question, the Court said, was whether counsel had been permitted by his client to act in a way that "sealed the fate regarding the entire property."

Here the Court drew the line that runs through Byram Pestonji Gariwala v. Union Bank of India: a counsel, duly authorised representative or general power-of-attorney holder may sign a compromise on behalf of those he represents, but only where there is express authorisation or an exigency of circumstance; a counsel should not act on implied authority in the absence of exigent circumstances. It reinforced the point with the three-judge decision in Himalayan Coop. Group Housing Society v. Balwan Singh, which describes it as the solemn duty of an advocate not to transgress the authority conferred by the client and holds that a lawyer has no implied or apparent authority to surrender or conclude the substantial legal rights of the client. And it noted the recent decision in Prasanta Kumar Sahoo v. Charulata Sahoo, which recalled the old caution of the Madras High Court in Govindammal v. Marimuthu Maistry that, prudence dictating, express power should be given in the vakalatnama itself before counsel enters into a compromise.

On the record, the Court found no express authorisation by defendant no. 5 permitting his counsel to sign the compromise, and nothing to demonstrate any exigent circumstance. In their absence, the "voluntary" element that Rule 3 requires could not be established, and the requirements of the Rule had not been complied with. The resulting compromise was "contrary to law."

Delay, and why it was excused

The gap between 1994 and 2022 was, the Court accepted, "egregiously large." But it held that delay could not be used to keep in force something not made in accordance with law. The Trial Court had rejected the limitation objection on the reasoning that the applicant claimed to have learnt of the fraudulent decree only shortly before filing — a matter of evidence for trial — that limitation runs against acts of parties and not of the Court, and that the power under Section 151 CPC may be exercised for the ends of justice, especially where fraud is alleged.

Two features of the case drove that conclusion. First, defendant no. 5's rights in the property — "not miniscule" — had been directly affected by a compromise he had not signed. Second, the most basic facts underlying the compromise were themselves contested: whether the parties were even family members (the plaintiff's side asserting, via a family chart, that Chaturbhuj was the maternal uncle of the first opposite party; the applicants denying any such relationship), whether defendant no. 5 knew of the proceedings at all, and whether his counsel had any authorisation. On the timeline the judgment records, defendant no. 5 died some eight years after the 1994 decree.

Outcome

The Court held that the compromise decree had been correctly set aside and that the issues in the partition suit require adjudication in a full trial. Acknowledging the difficulty of taking a 1989 suit to trial some 37 years later, it nonetheless held that the rights of the parties cannot be decided without the due process of collecting and weighing whatever evidence is available. The appeal was dismissed, with no costs.

Why it matters

For practitioners, the case is a reminder that the party's signature on a compromise is not a formality to be papered over by counsel's endorsement. Where a settlement extinguishes substantive property rights, express authority — ideally recorded in the vakalatnama or a special instrument — is the safe course, and its absence can unravel a decree decades later. Equally, limitation is not an automatic shield for a compromise decree said to be fraudulent: where the underlying facts are disputed and substantive rights are at stake, a court may look past even a 25-year delay, though only after a fact-specific inquiry.

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Sources

• Supreme Court of India, Krishna Kumar Ojha & Ors. v. Jitendra Chaudhary & Ors., 2026 INSC 662 (Judgment dated 1 July 2026)
• Code of Civil Procedure, 1908, Order XXIII Rule 3 and Section 151