Devi Prasad & Ors vs Vishwa Nath Prasad & Ors

The Supreme Court held that under Order 23 Rule 3 of the Code of Civil Procedure, a compromise can only be accepted if it is proven to the court's satisfaction that it was made lawfully and with the consent of all parties. The court emphasized that when one party alleges forgery of their signature, as in this case, it is mandatory for the court to conduct an inquiry into the allegations before accepting the compromise. The dismissal of the civil revision application was upheld, affirming the lower court's decision to not accept the compromise due to the disputed nature of the agreement.