Compromise Deed (Sulah Nama) (Pakistan)

A Compromise Deed (Sulah Nama) in Pakistan sets out the agreed resolution of the disagreement, defining what each party gives up and what they receive in return.

The Code of Civil Procedure 1908 is the primary procedural statute governing civil litigation in Pakistan, enacted as Act V of 1908. Order XXIII Rule 3 CPC provides that where the parties to a suit satisfy the court that they have agreed to the terms on which the dispute is to be settled, the court shall, if it is satisfied that the agreement is lawful, record the compromise and pass a decree in accordance therewith. A compromise decree under Order XXIII Rule 3 CPC has the same force as a court decree and can be executed through the court's execution machinery under Order XXI CPC. The Federal Shariat Court has affirmed that Sulah Nama conforming to Shariah principles is consistent with Islamic law and enforceable in Pakistan's courts.

A Sulah Nama is widely used in Pakistan outside court proceedings as well — as an out-of-court settlement deed executed before an Oath Commissioner, Notary Public, or registered at the sub-registrar's office under the Registration Act 1908 to give it additional evidentiary weight. Where the Sulah Nama relates to immovable property — land, houses, agricultural plots — and involves any transfer of rights, Section 17 of the Registration Act 1908 requires compulsory registration of the document at the relevant sub-registrar's office, and the appropriate stamp duty under the Stamp Act 1899 must be paid based on the value of the property transferred.

The Qanun-e-Shahadat Order 1984 (President's Order No. 10 of 1984), which governs evidence in Pakistani courts, treats a duly executed Sulah Nama as a document admissible under Article 73 as a document forming part of a transaction and under Article 100 as a document that evidences a right or obligation. Where the Sulah Nama is executed on stamp paper of the appropriate denomination under the Stamp Act 1899, it is admissible in evidence without further proof of its contents. Unstamped Sulah Namas may be impounded by courts under Section 35 of the Stamp Act 1899.

Family Sulah Namas are particularly common in Pakistan for resolving inheritance disputes among legal heirs following the death of a family member, division of property between brothers or cousins, settlement of mehr (dower) disputes in divorce proceedings before Family Courts under the Family Courts Act 1964, and resolution of maintenance disputes. The West Pakistan Muslim Personal Law (Shariat) Application Act 1962 applies Islamic succession rules to Muslim families, and Sulah Namas executed in the context of inheritance often incorporate a settlement of shares under the Hanafi rules of succession recognised in Pakistan.

A Compromise Deed (Sulah Nama) in Pakistan is required across a wide range of civil, family, property, and commercial disputes where the parties prefer a negotiated settlement to prolonged and costly litigation.

A Sulah Nama is needed when two or more family members — brothers, sisters, cousins, or other legal heirs — are in dispute over the inheritance and division of property left by a deceased family member, and they wish to settle their respective shares in the estate without going through succession proceedings in the District Court or the Family Court under the Family Courts Act 1964. The Sulah Nama records the agreed division, releases all signatories from further claims, and if involving immovable property, is registered at the sub-registrar's office under the Registration Act 1908.

A Sulah Nama is required when pending civil litigation — a suit for recovery of money, a property dispute suit, or a declaratory suit — is pending before a Civil Court, and the parties reach a negotiated settlement. The Sulah Nama is filed before the court under Order XXIII Rule 3 of the Code of Civil Procedure 1908, and the court passes a compromise decree that is enforceable without further trial.

A Sulah Nama is needed in criminal matters under compoundable offences. Many criminal offences in Pakistan — such as hurt (ghayr-amd), wrongful confinement, and certain property offences — are compoundable under the Criminal Procedure Code 1898 (CrPC) and the Qisas and Diyat Ordinance (incorporated in the Pakistan Penal Code 1860). A Sulah Nama records the compromise between the complainant and the accused, and the affidavit or compromise deed is filed in the criminal court, enabling the court to acquit the accused or reduce the sentence.

A Sulah Nama is needed when landlord and tenant disputes — over non-payment of rent, eviction, or property damage — are resolved before going to the Rent Controller or Civil Court under the relevant provincial rent control legislation, such as the Punjab Rented Premises Act 2009 or the Sindh Rented Premises Ordinance 1979.

A Sulah Nama is required when a commercial dispute — over a business agreement, a partnership dissolution, or a contractual obligation under the Contract Act 1872 — is settled between business parties, avoiding arbitration proceedings or litigation in the Commercial Court established under the High Courts (Establishment of Commercial Benches) Act 2020.

A valid Compromise Deed (Sulah Nama) in Pakistan under Order XXIII Rule 3 of the Code of Civil Procedure 1908 and the Registration Act 1908 must contain the following essential elements to be legally effective and admissible.

Party Identification: Full legal names, NADRA Computerised National Identity Card (CNIC) numbers (13-digit format), fathers' names, ages, occupations, and residential addresses of all parties — both the party initiating the compromise (musaleh) and the party agreeing to it (musaleh lahu). Where a party is represented by an attorney, the power of attorney reference must be stated.

Background and Dispute Description: A clear statement of the underlying dispute — the subject matter, the nature of the disagreement (property, money, family, contractual), and where applicable, the case number, court name, and date of institution of any pending suit. This ties the Sulah Nama to the specific dispute being settled.

Terms of Compromise: The precise, numbered terms upon which the parties have agreed. These must be clear, specific, and capable of performance. Terms may include: payment of a lump sum or instalments; transfer of property rights; withdrawal of pending cases; release of claims; and any other obligations agreed. Ambiguity in the terms defeats the purpose of the Sulah Nama and may cause further dispute.

Consideration (Badal-e-Sulah): The Sulah Nama must state the consideration — Badal-e-Sulah under Islamic jurisprudence — that the compromising party receives in exchange for giving up their claim. This may be a monetary payment, a share of property, a release from an obligation, or any other lawful benefit. Under the Contract Act 1872, a compromise without consideration is unenforceable as a contract.

Release and Discharge Clause: A clear statement that upon performance of the agreed terms, all parties release each other from all claims, demands, suits, and actions — past, present, and future — arising out of the dispute subject matter. This prevents further litigation on the same matter, consistent with the principle of res judicata under Section 11 CPC.

Registration and Stamp Duty: Where the Sulah Nama involves immovable property, it must be registered at the relevant sub-registrar's office under Section 17 of the Registration Act 1908, and stamp duty under the Stamp Act 1899 must be paid at the rate applicable to the type of instrument (conveyance, release, or agreement). Non-registered documents affecting immovable property rights are inadmissible in evidence under Section 49 of the Registration Act 1908.

Witness Attestation: At least two adult witnesses — both of whom have read the document or had it read to them and confirm the parties signed voluntarily — must attest the Sulah Nama. Under Article 17 of the Qanun-e-Shahadat Order 1984, the testimony of two male witnesses, or one male and two female witnesses, is required for financial transactions.

Oath Commissioner Attestation: The Sulah Nama should be attested by an Oath Commissioner appointed by the relevant High Court (Lahore, Sindh, Peshawar, Balochistan, or Islamabad High Court) or a First Class Judicial Magistrate to give it maximum evidentiary weight in subsequent proceedings.

Forms-legal.com provides this Compromise Deed (Sulah Nama) Pakistan template as a starting point for settlement negotiations. The template reflects requirements under the Code of Civil Procedure 1908, the Contract Act 1872, the Registration Act 1908, the Stamp Act 1899, and the Qanun-e-Shahadat Order 1984. An advocate enrolled at a provincial Bar Council — Lahore, Sindh, Peshawar, Quetta, or Islamabad — should be consulted where the dispute involves immovable property, pending criminal proceedings, or complex family inheritance matters.