3. Compromise of suit.- Where it is proved to the satisfaction of the court that a suit has been adjusted wholly or in part by any lawful agreement or compromise in writing and signed by the parties, or where the defendant satisfies the plaintiff in respect of the whole or any part of the subject matter of the suit, the court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a decree in accordance therewith so far as it relates to the parties to the suit, whether or not the subject matter of the agreement, compromise or satisfaction is the same as the subject matter
of the suit: - Provided that where it is alleged by one party and denied by the other than an adjustment or satisfaction has been arrived at, the court shall decide the question; but no adjournment shall be granted for the purpose of deciding the question, unless the court, for reasons to be recorded, thinks fit to grant such adjournment. Explanation : An agreement or compromise which is void or avoidable under the Indian Contract Act, 1872 (9 of 1872), shall not be deemed to be lawful within the meaning of this rule. HIGH COURT AMENDMENTS Allahabad.- (1) In rule 3 of Order 23 between the words “or compromise” and “or where” insert the words “in writing duly signed by parties”; and between the words “subject-matter of the suit” and the words ‘the Court” insert the words “and obtains an instrument in writing duly signed by the plaintiff.” (2) At the end of the Rule 3 of Order 23 add the following, namely: “Provided that the provisions of this rule shall not apply to or in any way affect the provisions of the Order XXXIV, Rules 3, 5 and 8. Explanation - The expression “agreement” and “compromise” include a joint statement of the parties concerned or their counsel recorded by the Court, and the expression “Instrument includes a statement of the plaintiff or his counsel recorded by the Court.” U.P. Gaz., 31 .8.1974, Pt. II, p. 52 (31.8.1974). Provided that” - T.N. Government Gaz. 18.2.1981, Pt. III, S. 2, p. 18. Orissa.- Delete High Court amendment - On, Gaz., 25.5.1984, Pt. III, A, p. 70. Punjab, Haryana and Chandigarh. - Add the following provisos to the rule: “Provided that the hearing of a suit shall proceed and no adjournment shall be granted in it for the purposes of deciding whether there has been any adjustment or satisfaction unless the Court for reasons to he recorded in writing thinks fit to grant such adjournment, and provided further that the judgment in the suit shall not be announced until the question of adjustment or satisfaction has been decided: Provided further that when an application is made by all the parties to the suit either in writing or in open court through their counsel that they wish to compromise the Suit, the Court may fix a date on which the parties or their counsel should appear and the compromise be recorded but shall proceed to hear those witnesses in the suit who are already in attendance, unless for any other reason to be recorded in writing, it considers it impossible or undesirable to do so. f upon the date fixed no compromise has been recorded, no further adjournment shall be granted for this purpose, unless the court, for reasons to be recorded in writing, considers it highly probable that the suit will be compromise on or before the date to which the court purposes to adjourn the hearing.” (21.7.1937).
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