PETITIONER: GULABCHAND CHHOTALAL PARIKH Vs. RESPONDENT: STATE OF BOMBAY (NOW GUJARAT) DATE OF JUDGMENT: 14/12/1964 BENCH: <NAME>, K. BENCH: <NAME>, K. SARKAR, A.K. DAYAL, RAGHUBAR AYYANGAR, N. RAJAGOPALA MUDHOLKAR, J.R. CITATION: 1965 AIR 1153 1965 SCR (2) 547 CITATOR INFO : R 1965 SC1325 (62) R 1968 SC1370 (5,6) RF 1977 SC1680 (7) RF 1981 SC2198 (13) ACT: Practice and Procedure-Decision on writ application under Art. 226- suit for same relief-If barred by res judicata. HEADNOTE: The appellant prayed for the issue of a writ of mandamus and a writ of prohibition against the respondent-<ORG> in a writ application filed in <ORG>, on the ground that his liability as surety for some contractors stood discharged on account of a particular action of the <ORG>. <ORG> dismissed the petition on merits after full contest. He thereupon filed a suit against the respondent and raised the same plea that he was discharged from liability as surety on the same grounds. The trial court, the first appellate Court and <ORG> Held that the suit was barred by res judicata in view of the judgment of <ORG> on the writ petition. In appeal to <ORG>, HELD (Per <NAME>, <NAME>, <NAME> and <NAME>.) : On general principles of res judicata, the decision of <ORG> on a writ petition under Art. 226 of the Constitution, on the merits, on a matter, after full contest, will operate as res judicata in a subsequent regular suit between the same parties with respect to the same matter. [574 E-F] The provisions of s. 11, Civil Procedure Code, 1908, are not exhaustive with respect to an earlier decision operating as res judicata between the same parties on the same matter in controversy in a subsequent regular suit and, on the general principle of res judicata, any previous decision on a matter in controversy decided after full contest or after affording fair opportunity to the parties to prove their case by a court competent to decide it, will operate as res judicata in a subsequent regular suit. It is not necessary that the court deciding the matter formerly be competent to decide the subsequent suit or that the former proceeding and the subsequent suit have the same subject matter. The nature of the former proceeding is immaterial. There is, therefore, no good reason to preclude such decisions on matters in controversy in writ proceedings under Arts. 226 or 32 from operating as res judicata in subsequent regular suits on the same matters in controversy, between the same parties, and thus to give limited effect to the principle of finality of decisions after full contest [573 B-E] Case law reviewed. Per <NAME>, J. (dissenting) : The decision given by <ORG> in the writ petition would not preclude the court, before which the suit was filed, from deciding the same question an merits in the suit. [576 F] This view, while it does not make s. 11 of the Code an unnecessary provision, does not lead to any practical difficulties, for, the decision of <ORG> on a question of law will be binding as an authority on Subordinate Courts and its decision on a question of fact will rarely be differed from by the said courts. [576 E-F] Case law considered. 548 JUDGMENT:

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 670 of 1963. Appeal by special leave from the judgment and decree dated March 31, 1958 of <ORG> in <ORG> of 1957.

<NAME> and <NAME> for the appellant. <NAME> and <NAME>, for the respondent. The Judgment of <NAME>, <NAME>, <NAME> and <NAME>, JJ. was delivered by <NAME> <NAME>, J. delivered a dissenting Opinion. <NAME>, J. This appeal, by special leave, raises the question whether a decision of <ORG> on merits on a certain matter after contest in a writ petition under Art. 226 of the Constitution operates as res judicata in a regular suit with respect to the same matter between the same parties.

The facts leading to the appeal are these. The appellant stood surety for a number of contractors who had taken contracts in 1947 for felling timber trees and removing timber in various forests in the erstwhile <ORG> of Baria. The contracts were taken as a result of auctions which took place under the 'Conditions of Auction Sale of Forests in the Baria <ORG> in the Samvat year 2002' corresponding to 1945-46 A.D., though in the plaint these conditions were referred to as Forest Auction Rules. On April 7, 1948, the appellant presented an application to the Baria <ORG> stating therein that certain brokers owed money to the various contractors mentioned in the application and praying that they be restrained to pay the amount due to the contractors until further orders and that those brokers and contractors be also restrained from directly removing the contractors' jungle goods stored in the godowns at Piplod, Baria and Limkheda without the permission of <ORG>. It was further mentioned in the application that if those contractors would arrive at an arrangement with him and carry out the vahivat, be would do the needful in that behalf. On this application, it appears, <ORG> issued notices to the contractors stating therein that the surety, i.e., the appellant, had moved, under cl. 8 of the Conditions of the Auction Sale of jungle goods for attachment of their goods that be lying in the godowns at Baria, Piplod and Limkheda in the <ORG> and the debts or other movable or immovable property belonging to them and for delivering the same to him and directed the contractors not to sell, mortgage, gift away or otherwise dispose of whatever movable or immovable property they had in the <ORG> without the permission of the <ORG>.

Subsequently, the State of Baria merged with the State of Bombay on June 10, 1948. Thereafter, the contractors were allowed by the <ORG> to remove the materials on certain conditions.

The appellant presented a writ petition under Art. 226 of the Constitution to <ORG> of Bombay. That petition is not printed in the appeal record. It was Civil Application No. 261 of 1952. It, along with two other applications, C.As. Nos. 260 and 376 of 1952, was disposed of by a common judgment in C.A. 260 of 1952 which is Exhibit P. 194. The parties agree that what was alleged and what was prayed for by the appellant in his petition could be gathered from the order Exhibit P. 194. The reply filed by the parties in that petition is Exhibit P. 196 and gives the case of the opposite party with respect to the allegations of the appellant in his petition. It however appears from the order of <ORG> on that writ petition that the reliefs claimed were a direction to the respondents i.e., the State of Bombay and the <NAME> of Baria Taluka to raise the attachment levied' on Municipal Nos. 728 and 642 of Deogad Baria, the issue of a writ of mandamus or directions under Art. 226 of the Constitution prohibiting them from selling those Municipal numbers and: from proceeding with the auction sale of properties on February

15. 1952 or on any other date. The appellant had alleged in that petition that the attached properties of the contractors were allowed to be sold by the contractors without the knowledge and consent of the appellant, that the sale was unauthorised and contrary to the terms of the attachment levied by the <ORG> and that therefore it bad put an end to the liability of the appellants under their surety bonds.

It was urged for the appellant at the hearing of that petition that since the State allowed the contractors to sell their own properties the appellant had been discharged from his suretyship in respect of the said contractors and that the State could no longer claim to recover from him the balance due from the said contractors. The writ application was presented because, in default of the contracts to pay the balance amount due from them the Forest Officers of <ORG> had moved the Revenue Officers to recover the said amount from the appellant who was the surety as an arrear of land revenue. The revenue authorities took steps to attach the immovable properties of the appellant and that led the appellant to present that petition.

The contentions for the State of Bombay and the <ORG> in the writ proceedings were :

1.The petition was misconceived as not maintainable and there was no case for the issue of a writ of mandamus because the proper course for the appellant was to redress his so called grievance by proceeding according to the ordinary law through <ORG>.

2.There were no Baria State Forest Auction Rules. What <ORG> laid down were the conditions of such auction sales and the appellant's reference to those conditions as rules was not correct.

3.The contractors had to furnish a surety who also had to execute a separate and independent agreement with the <ORG> in the Form approved by it. The appellant stood surety for the contractors and executed the necessary agreements.

4.The said agreements stipulated three important conditions : (i) that the surety will pay the installment amount as stipulated;

(ii) that if the instalments were not paid on due dates, he will pay interest at one pie per rupee per day and (iii) that if he fails to pay the instalment amounts and the interest, the <ORG> will be at liberty to recover the same from any of his properties and from his successors and assignees.

5.Condition No. 8 of the conditions for auction sales of forests was "So long as the contractor has not paid the deposit or the confirmed sale price in full into the <ORG> or to the <ORG>, the <ORG> shall, at any time present an application to the <ORG> Officer for the recovery of an amount required to discharge his liability in connection with the confirmed sale price or of the amount paid by him without filing a suit for the same in a civil Court. In that case the property, effects and debts of the contractor that may be within the territory of the <ORG> shall, as in the case of land revenue, be attached and auctioned at the cost and risk of the contractor and out of the sale proceeds realised at the auction, the amount due to the surety or an amount equivalent to the amount required to discharge his liability shall be paid to the <ORG>."

<NAME>

6.The appellant had not applied for attachment and sale of all the properties and outstandings of the contractors but had requested the <ORG> to see that the brokers did not pay their dues to the contractors that the materials in the depots were not directly disposed of by the contractors and that the contractors carried on the business after settling with the petitioner.

7.The <ORG> issued the necessary injunction orders of attachment, even though the appellant's request dated April 7, was not at all consistent with the provisions of sale condition No. 8.

8.In order to obviate the complete hold up of the timber trade, a system was devised whereby the contractors were allowed to dispose of the stock of timber, if the sureties consented to its removal and the contractors guaranteed to pay the price realised to the sureties concerned.

9.According to the record, the appellant had requested the <ORG> to release the goods of certain contractors by his letters dated May 19, and 22, of 1948. This scheme adopted by the <ORG> of Baria was solely motivated in view of the inevitable delay on account of the sureties first realising the amount and then depositing the amount in the Government treasury and the appellant was aware of that slight modification in the procedure.

10.At a meeting convened by <ORG>, Panchmahals, Godhra, on August 1, 1948, the appellant was present and it was decided that the contractors be permitted to remove the material on payment of the price of the materials sold.

11. It was denied that as a result of the alleged action of the Forest Officers, the petitioner's security was considerably disminished and the eventual remedy of the petitioner against the contractors was very much impaired and the petitioner was discharged from his suretyship in respect of the said contracts.

<ORG> dismissed the writ petition on July 22, 1952 holding that there was no substance in the contention that the petitioners had been discharged from their liability as sureties. The sole basis on which the contention was raised was that the contractors were permitted by the <ORG> to sell their properties which were under attachment contrary to the terms of the attachment, in view of the sales being held without the knowledge and consent of the appellant. <ORG> held that it was a wrong assumption of the appellant that the attached goods were not to be sold without his knowledge and consent. The prayer made by the appellant in his application dated April 7, 1948 did not include a prayer to the effect that the attached goods be not sold without his knowledge and consent. <ORG> therefore held that the plea that the sales absolved the appellant from his liability as surety could not be accepted. We are no more concerned with the other point raised by the writ petition to the effect that the revenue authorities were not entitled to recover the amount due from the appellant under the summary procedure prescribed by the Land Revenue Code. <ORG> did not accept this contention.

On August 29, 1952, the appellant instituted the suit which has given rise to this appeal. It was alleged that the Baria State had its own laws and rules and regulations, that the contractors of that State were bound to act according to them, that the Baria State had rules known as Forest Auction Rules for the auction of timber of the forests and auctions were held according to those rules and that the people acted on the understanding that the auctions and the surety bonds were in pursuance of the said Rules. Auctions were held in September-October 1947. The appellant stood surety with respect to the 1 1 contracts mentioned in para 2 of the plaint. The alleged rude No. 8 (condition No. 8 of the Forest Auction Conditions) was quoted in the plaint. The appellant executed all the surety bonds on the understanding that the Baria State Forest Auction Rules were the basis of the auction sales and that the surety bonds were in accordance with those rules. Due to certain reasons mentioned in para 5 of the plaint, the appellant. on or about April 13, 1948, applied to the Baria State praying for the assets and properties of the contractors to be taken in attachment and sold and for facilities being made available to him to fulfill his liabilities under the surety bonds. The Baria State authorities attached the assets and properties of the Contractors as prayed. It may be mentioned here that in his deposition the appellant admitted the application, Exhibit 195, dated April 7, 1948 to be the application be had presented for the aforesaid purpose. It was further alleged in the plaint that subsequent to the merger of the Baria State with the Bombay State on October 6, 1948, <ORG>, without asking the plaintiff or without his consent, allowed the said contractors to remove and sell their respective teak and sundry goods which were taken in attachment and thus behaving in contravention of the attachment made in his interest and put an end to his security and that according to law the plaintiff thus became discharged of liability as surety for the said contractors. Another reason for his alleged discharge from liability was alleged to be that even fresh sureties had been obtained from some contractors. It was also mentioned in the plaint that the appellant had to make a petition to <ORG> in order to prevent his property from being sold and that he had been informed that the said petition had been dismissed on the ground that he could lawfully get his reliefs in <ORG>.

On the above facts the appellant prayed inter alia as follows "1. It may be declared that have become is charged from all liability as surety for the contractors mentioned in para 2 of this plaint and a decree may be passed against the defendant No. 2 and defendant No. 1 herein and their servants, officers and agents, in the form of a permanent injunction prohibiting them for all times from attaching my property, selling or causing it to be sold.

2.A permanent injunction may be issued to the defendant No. 1 herein and their servants, agents and officers that these defendants, under the facts mentioned in this plaint shall not, unless in execution of a decree in their favour obtained from a proper and authorised court, attach any property of this plaintiff and sell it in the revenue manner or cause it to be sold."

The State of Bombay contested the suit mostly repeating what they had urged in their reply affidavit filed in the proceedings on the writ application. It did not admit that the writ application filed by the plaintiff was dismissed by <ORG> because another remedy was open and stated that his contentions were not upheld.

Several issues were framed. Issue No. 8A was "Is the suit barred by res judicata in view of <ORG> judgment in Civil Applications No. 260, 261 and 376 of 1952 ?"

<ORG> held on this issue that judgment operated as res judicata in the suit. It recorded its findings on the other issues as well, but we are not concerned with those findings. It dismissed the suit.

On appeal by the appellant, the District Judge agreed with <ORG> that the suit was barred by res judicata in view of the judgment of <ORG> on the writ petition. He accordingly dismissed the appeal. He also recorded his findings on the other points urged before him. On second appeal, the learned Single Judge of <ORG> agreed with the courts below that the decision of <ORG> on the question whether the plaintiff was absolved from liability under the surety agreement must be regarded as res judicata and could not be opened in the suit. He further considered the question whether in the circumstances of the case the appellant was entitled to the injunction prayed for and held that it was open to the appellant to maintain the suit for the determination of the amount due from him as that had not been considered and determined in the writ petition. He therefore allowed the appeal, set aside the order of the District Judge and passed a decree in favour of the appellant declaring that he was liable to pay the amount due under the surety agreement less the amount paid by the contractor and such amount as had been recovered by the <ORG> by sale of the property of the contractor attached under condition No. 8. He further ordered issue of an injunction restraining the <ORG> from enforcing the liability for the amount in excess of the amount declared to be due from the appellant.

The appellant's application for leave to file an appeal under cl. 15 of the Letters Patent of <ORG> was rejected. Thereafter, the appellant filed this appeal after obtaining special leave from this Court. Mr. <NAME>, for the appellant, has urged two points. The first is that a decision in a writ application under Art. 226 for the issue of a writ of mandamus does not operate as res judicata in a regular suit subsequently filed for a declaration of the plaintiff's rights and for the issue of an order of injunction against the defendant. The other is that the doctrine of constructive res judicata cannot be applied when the dispute was first decided in a writ petition and is to be later decided in a regular suit. It has been said that it would be very dangerous to hold that the decision in the writ application operates as res judicata in the regular suit even if identical reliefs on identical grounds were prayed for in a writ petition, with those prayed for in the later regular suit.

The first question is really the main question for decision in this appeal as it is not a case for the application of the principle of constructive res judicata. It is clear from what has been stated above that the appellant prayed for the issue of a writ of mandamus and a writ of prohibition in the writ application on the ground that his liability as surety for the several contractors stood discharged on account of the <ORG>, without the knowledge and consent of the appellant, allowing the contractors to dispose of the goods which had been attached on the application of the appellant, an application which he could present in view of Condition 8 of the Conditions of Auction Sale. The reliefs sought in the plaint are the same and are sought on the same grounds. <ORG> had to determine in the writ petition whether the appellant's liability as surety stood discharged in view of what he had alleged. The same, point has to be directly and substantially decided in the suit also. The orders to be passed if the appellant's contention is upheld would be the same as that which would have been passed if his contention had been accepted in the writ petition. In both cases, on both occasions, the <ORG> had first to hold that his liability as a surety stood discharged, and that as a consequence of such a finding, it had, in the writ proceedings, to issue a writ of mandamus and a writ of prohibition as prayed for in the writ peti- tion, directing the <ORG> of Bombay not to enforce any liability which the appellant had undertaken under the agreements executed as a surety and not to proceed with the realisation of any amount the <ORG> alleged to be due from him and in the suit to pass a decree prohibiting the defendants by a permanent injunction for all time from attaching his property selling or causing it to be sold and also a permanent injunction to the <ORG> of Bombay restraining them from attaching and selling any proper of the appellant unless a proper decree is obtained from the <ORG> in the manner provided for the recovery of land revenue.

It is urged for the appellant that in the writ petition the contention about the appellant's liability as a surety having come to an end was based on the terms of the contract, which was based on the conditions of auction sales, between the appellant and the State of Baria while in the present suit the contention with respect to the cession of his liability as a surety was based on the auction rules. The distinction sought to be made has no substance. It is denied in the reply affidavit filed on behalf of the respondent in the writ petition that there were any Baria State Forest Auction Rules. We have not been referred to any rules, In fact, when we asked for the rules, we were provided by learned counsel for the appellant with a booklet by the name 'Conditions for the Auction Sale of Forests'. Further, the order of <ORG> on the 'writ petition mentions in the early part of the order :

"It would appear that the Baria State had auctioned the teak wood trees ... on the terms and conditions contained in the said Forest Auction Rules."

It may be said that these conditions for the auction sale of forests have been referred to sometimes as rules, probably in view of their binding nature.

It cannot therefore be disputed that if the decision which had been given in a writ petition had been given in a regular suit that decision would have operated as res judicata in the later suit. The question which arises for consideration is whether such a decision in a writ petition can also bar a later suit on account of its operating as res judicata.

Before we deal with the question, we may dispose of the short points urged for the appellant. It is urged that if a decision in a writ application on merits be held to operate as res judicata in a regular suit, the provisions of 0.2, r. 2 C.P.C. would also be applicable to the institution of the subsequent suit with respect to such part of the cause of action for which no relief was sought in the writ petition. The contention is not sound as the provisions of r. 2, 0.2 apply only to suits. Sub-r. (1) requires that every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action; but a plaintiff may relinquish any portion of his claim in order to bring the suit within the jurisdiction of any <ORG>. Sub-rule (2) then provides that where a plaintiff omits to sue in respect of or intentionally relinquishes any portion of his claim, he shall not afterwards sue in respect of the portion so omitted or relinquished. By its very language, these provisions do not apply to the contents of a writ petition and consequently do not apply to the contents of a subsequent suit. Such a view was indicated by this <ORG> in <CITATION> (l) when it was said at p. 324 : ' "The bar of 0.2, r. 2 of the Civil Procedure Code on which the High <ORG> apparently relied may not apply to a petition for a high prerogative writ under Art. 226 of the Constitution, but the High <ORG> having disallowed the claim of the appellant for salary prior to the date of the suit, we do not think that we would be justified in (1)  Supp. 1 S.C.R. 315.

interfering with the exercise of its discretion by <ORG>."

The contention that a decision on a writ petition even on merits should not operate as res judicata as it is discretionary for the Court to pass any order it considers fit on a writ petition and not to decide it after considering all the points urged by the parties, was negatived in <NAME> v. The State of U.P.(1) With regard to the point that the issue of a writ by <ORG> was discretionary as it may refuse to exercise its jurisdiction under Art. 226 as for instance when the party applying for the writ was guilty of laches but <ORG> could not refuse to issue the appropriate writ once it was shown that a fundamental right had been infringed, it was said, at p. 589 :

" and that may be said to constitute a difference in the right conferred on a citizen to move <ORG> under Art. 226 as distinct from the right conferred on him to move this Court. This difference must inevitably mean that if <ORG> has refused to exercise its discretion on the ground of laches or on the ground that the party has an efficacious alternative remedy available to him then of course the decision of <ORG> cannot generally be pleaded in support of the bar of res judicata. If, however, the matter has been considered on the merits and <ORG> has dismissed the petition for a writ on the ground that no fundamental right is proved or its breach is either not established or is shown to be constitutionally justified there is no reason why the said decision should not be treated as a bar against the competence of a subsequent petition filed by the same party on the same facts and for the same reliefs under Art. 32."

In this connection, reference may be made to what was said, about the contention that a previous judgment was not to operate as res judicata against a party as it was based on certain statements recorded before that party was impleaded, in <NAME> v. <NAME>) "It was suggested by Mr. <NAME> that the former judgment ought not to be binding, because certain witnesses having been examined before the present Appellant intervened in the suit, he was refused the opportunity of cross- examining them. Their Lordships think that (1)[1962]1 S.C.R. 574.

(2) L.R. 2 I.A. 283, 286 Sup.C.1./65 2 such an objection is no answer to the defence arising from the former judgment. If there had been any miscarriage of that kind, the matter was one for appeal in that suit. The objection does not appear to have been raised in the appeals which were successively made in that suit to the Civil Judge and to <ORG>; but whether it was so raised or not, their Lordships think that that cannot affect the operation of the final judgment, which must be taken to have been rightly given." Another reason urged in support of the contention is that the petitioner in a writ petition had no right to apply for the issue of the appropriate writ and it is a matter of discretion for <ORG> to entertain any application or to grant it and that a decision in one proceeding can operate as res judicata in a subsequent proceeding only when the party initiating the first proceeding had a right to initiate both the proceedings when the nature of both the proceedings be the same. This is the same contention as the earlier one, put in a different form, and does not merit further consideration.

It is further submitted for the appellant that a writ of mandamus, according to its nature, is to be issued mainly to compel the performance by a public servant of his duty of a public nature, while in a suit the plaintiff prays for the enforcement of his personal rights. The declaration of a personal right is not an essential characteristic in the issue of a writ of mandamus. The difference in the nature of the two proceedings is immaterial if the matter decided inter parties in one proceeding is the same which is to be determined in the subsequent proceedings and the parties to the suit were also parties to the writ petition. It has also been contended, and support is sought from the case reported as L. Janakirama lyer v. <NAME>) that the general principles of res judicata are not to be applied in considering whether a decision in a previous suit bars a later suit on the ground of res judicata.

On the other hand, it is contended for the respondent that the doctrine of res judicata is not confined to the provisions of S. II C.P.C. but is of a general application on grounds of public policy, that the fact that the proceedings on a writ petition are conducted summarily is no reason to reduce the value of the decision arrived at in those proceedings especially when a solemn decision is given after affording an opportunity to the parties to put before the (1) [1962] Supp. 1 S.C.R. 206.

<NAME>

<ORG> all the relevant matters and after fully considering the merits of the matter in controversy and that it would be really dangerous if it be held that a decision so arrived at in proceedings in a writ petition does not bar a subsequent suit for the decision of the same matter in controversy. It is pertinently pointed out that if the writ application presented by the appellant had been allowed by <ORG> on a finding of fact that the liability of the appel- lant as a surety stood discharged and a writ of prohibition had been issued against the <ORG> as prayed for by the appellant in the writ proceedings, the <ORG> could not have sued for a declaration that these orders of <ORG> were bad and that a decree be passed in its favour declaring that the appellant's liability as the surety still continued and that the <ORG> was free to take any action open to it under law for the recovery of the amount due from him. It is not necessary to consider in any detail whether all orders made on a writ petition would bar a subsequent suit. We would limit the consideration of the contentions raised before us to two main points : whether S. 11 C.P.C. is exhaustive with respect to the application of the principle of res judicata in a suit and whether in a subsequent suit general principles of res judicata can bar the consideration of matters directly in issue and identical with. those which had been earlier and after full contest, decided on merits by a competent <ORG> in any other proceeding including proceedings on a writ petition.

Before discussing the law of res judicata as laid down in the Code of Civil Procedure, we may refer to the opinion of the Judges expressed in 1776 in the Duches of Kingston's Case(1) to which reference has been invariably made in most of the cases to be considered by us. It was said in that case :

"From the variety of cases relative to judgments being given in evidence in civil suits, these two deductions seem to follow as generally true : first that judgment of a <ORG> of concurrent jurisdiction, directly upon the point. is as a plea, a bar, or as evidence conclusive, between the same parties, upon the same matter, directly in question in another <ORG>; secondly that the judgment of a <ORG> of exclusive jurisdiction, directly upon the point, is, in like manner, conclusive upon the same matter, t between the same parties, coming incidentally in question in another <ORG>, for a different purpose. But neither the judgment of a concurrent or exclusive jurisdiction is (1) 2 smith's L.C. 13th edn. 644, 645.

evidence of any matter which came collaterally in question, though within their jurisdiction, nor of any matter incidentally cognizable, nor of any matter to be inferred by argument from the judgment."

It is to be noticed that the opinion does not take into account whether the earlier judgment was in a suit or any other proceeding and whether it was used as res judicata in another suit or proceeding. The emphasis is that the judgment be of a <ORG> and that it is relied upon as res judicata in another <ORG>. Of course, the essential conditions that the judgment be directly upon the same point which is for determination in the subsequent suit and be between the same parties are also to be satisfied. It is obvious that the judgment of a <ORG> of exclusive jurisdiction is to be treated as res judicata upon the same matter in another <ORG> which will not be a <ORG> having jurisdiction over the matter.

It would be helpful to consider how the various Codes of Civil Procedure have dealt with the question of the second suit being barred on account of an earlier decision by a Court. The first Code of Civil Procedure was Act VIII of 1859. Its section 1 gave jurisdiction to the civil courts over all suits of a civil nature with the exception of those of which cognizance was barred by any Act of Parliament or by any Regulation of the Codes of Bengal, Madras and Bombay or by any Act of the Governor General of India in Council. Since then Civil Courts had jurisdiction to try all suits of a civil nature except those whose cognizance was barred by any enactment in force. Section 2 provided that <ORG> would not take cognizance of any suit brought on a cause of action which had been heard and determined by a Court of competent jurisdiction in a former suit between the same parties or between parties under whom they claimed. The bar to the second suit was based on the identity of it, cause of action with that of the earlier suit which had been heard and determined by a court of competent jurisdiction between the same parties.

The language of s. 2 of the Code of 1859 seems to be in pursuance of the principle recognised in common law that a cause of action on which a decree has been based merges in the decree and ceases to be a cause of action for any future suit. <NAME> said in King v. <NAME> (1) at p. 2 1 0 of the English Reports :

"If there be a breach of contract, or wrong done, or any other cause of action by one against another, and judgment be recovered in a court of record, the judgment (1) 153 E.R. Exch. 206,13 M & W 494.

is a bar to the original cause of action, because it is thereby reduced to a certainty, and the object of the suit attained, so far as it can be at that stage; and it would be useless and vexatious to subject the defendant to another suit for the purpose of obtaining the same result. Hence the legal maxim, 'transit in rem judicatam the cause of action is changed into matter of record, which is of a higher nature, and the inferior remedy is merged in the higher. This appears to be equally true where there is but one c ause of action, whether it be against a single person or many. The judgment of a court of record changes the nature of that cause of action, and prevents its being the subject matter of another suit, and the cause of action, being single, cannot afterwards be divided into two."

This principle had the approval of <ORG> in <NAME> v. Hamilton.(1) It may be noticed that, in special cases, this principle is applied when even parties to the subsequent suit are not. the same who were parties in the first suit. The finality of the judgement is based on the fact that the cause of action had merged in a decree and therefore no other action can be based on the same cause of action.

In Khugawlee Sing v. Hossein Bux Khan(1) <ORG>, after quoting the opinion in Duchess of Kingston's Case(3) said :

"There is nothing technical or peculiar to the law of England in the rule as so stated. It was recognised by the civil law, and it is perfectly consistent with the second section of the Code of Procedure under which this case was tried.... "

In <NAME> v. <NAME>) <ORG> held that the term 'cause of action' in s. 2 of Act VIII of 1859 be construed with reference rather to the substance than to the form of action, and that even if such an interpretation of the expression be not correct, the provisions of S. 2 of the Code would by no means prevent the operation of the general law relating to res judicata and observed at p. 218 "This law has been laid down by a series of cases in this country with which the profession is familiar, and has probably never been betterlaid down than in a case which (1) (1879) 4 A.C. 504. (2) (1871) 7 Beng.

L.R. 673, 678.

(3) Smith's L.C. 13th edn. 644.(4) (1872-73) I.A. Supp. 212.

was referred to in the 3rd volume of <NAME> (Gregory v. Molesworth), in which Lord <NAME> held that where a question was necessarily decided in effect though not in express terms between parties to the suit, they. could not raise the same question as between themselves in any other suit in any other form; and that decision has been followed by a long course of decisions, the greater part of which will be found noticed in the very able notes of Mr. <NAME> to the case of the Duchess of <NAME>."

In <NAME> Case(1) <ORG> again stated that the expression 'cause of action' in s. 2 of Act VIII of 1859 could not be taken in its literal and most restricted sense, and observed at p. 285 :

"But however that may be, by the general law where a material issue has been tried and determined between the same parties in a proper suit, and in a competent <ORG>, as to the status of one of them in relation to the other, it cannot, in their opinion, be again tried in another suit between them."

It appears that s. 13 of the Code of Civil Procedure of 1877 was enacted in view of what was said about the general law of res judicata in <NAME> Case. (1) That section reads "No <ORG> shall try any suit or issue in which the matter directly and substantially in issue has been heard and finally decided by a <ORG> of competent jurisdiction, in a former suit between the same parties, or between parties under whom they or any of them claim, litigating under the same title."

In <NAME> v. <NAME>) <ORG> had to construe s. 13 of the 1877-Code (Act X of 1877). It referred to S. 2 of Act VIII of 1859 and then observed at p. 202 :

"It is clear that this section would not have applied to the present case, the causes of action in the two suits the non-payment of interest in one and the non-payment of principal in the other being different. In fact, when the first suit was brought the cause of action in the second had not arisen. But independently of this provision in the Code of Procedure, the Courts in India have adopted the rule laid down in the Duchess of Kingston's (1) L.R. 21. A. 283.

(2) (1882) L.R. 9 I.A. 197.

Case(1), and have applied it in a great number of cases. It was recognized as the law in India by <ORG> in <NAME> v. <NAME> (2) . . . . "

The expression 'Court of competent jurisdiction' was construed to mean 'a Court which had jurisdiction over the matter in the subsequent suit in which the decision was used as conclusive' or, in other words 'a Court of concurrent jurisdiction. In considering this matter, <ORG> referred to the fact that in this country there were Courts of various grades with different pecuniary limits of jurisdiction, that a suit had to be instituted in the Court of the lowest grade competent to try it and that it would be improper if a judgment of an inferior Court was to operate as res judicata in a suit in a superior Court, and observed at p. 203 "By taking concurrent jurisdiction to mean concurrent as regards the pecuniary limit as well as the subject matter, this evil or inconvenience is avoided; and although it may be desirable to put an end to litigation, the inefficiency of many of <ORG> makes it advisable not to be too stringent in preventing a litigant from proving the truth of his case. It appears to their Lordships that if this case had arisen before the passing of Act X of 1877, <ORG> in India would have rightly held that the decision of the Extra Assistant Commissioner in the first suit was not conclusive as to the amount of the principal sum due on the bond." and, after quoting s. 13, said :

"The intention seems to have been to embody in the Code of Procedure, by sects. 12 and 13, the law then in force in India, instead of the imperfect provision in sect. 2 of Act VIII of 1859. And, as the words of the section do not clearly shew an intention to alter the law, their Lordships do not think it right to put a construction upon them which would cause an alteration."

This shows that the general law of res judicata was applied to suits in this country despite a specific provision about it in S. 2 of Act VIII of 1859.

The scope of the bar was extended by the Code of Civil Procedure, 1882 (Act XIV of 1882). Its s. 13 dealt with res judicata.

(1) 2 <NAME>'s L.C. 13th edn. 644.

(2) (1871) 7 Beng. L.R. 673.

<NAME>

Section II of the present Code of Civil Procedure (Act V of 1908) deals with res judicata and is in these terms :

"No <ORG> shall try any suit or issue in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit between the same parties, or between parties under whom they or any of them claim, litigating under the same title, in a <ORG> competent to try such subsequent suit or the suit in which such issue has been subse- quently raised, and has been heard and finally decided by such <ORG>."

The above quoted main part of s. 11 is identically the same as the corresponding part of S. 13 of the Code of 1882. Section 11, by its terms, can be applicable only to a subsequent suit when the same matter in controversy had been heard and decided in an earlier suit by a <ORG> competent to try the subsequent suit. There is nothing, however, in its language to exclude the application of the general principles of res judicata to suits.

The general principle of res judicata, has been applied to suits even though the decision on the same matter in controversy had been previously given by a competent Court in proceedings which were not suits under the Code of Civil Procedure. The case law on the subject will be discussed later. It is urged that there seems to be no good principle behind applying the general principles of res judicata to suits in circumstances which do not bring the previous decision within the language of s. 11, and that the legislature's restricting the application of the general principles of res judicata to the circumstances mentioned in s. 11 must be deemed to indicate that the general principle of res judicata be not applied to bar a subsequent suit if the earlier decision of the same controversy between the same parties had been arrived at in proceedings other than suits and in which the entire procedure provided for the decision of the dispute in a regular suit might not have been followed. It appears to us that the reason for the specific provisions of S. 11 is not that the legislature intended to bar the application of the general principles of res judicata to suits when the previous decision is arrived at in proceedings other than suits. The legislature was providing in the Code of Civil Procedure for the trial of suits over which <ORG> was given jurisdiction under the provisions of the Code. The preamble of the Code of 1908 reads "Whereas it is expedient to consolidate and amend the laws relating to the procedure of <ORG>; It is hereby enacted as follows :-"

The Code was dealing with procedure of the civil <ORG>s only and had therefore not to consider what would be the effect on the trial of suits in view of the provisions of other enactments or of general principles of res judicata or of any other kind. It had to restrict its provision about res judicata to the effect of decisions in a civil suit on a subsequent civil suit and therefore enacted s. 11 in the form in which we find it. It made one of the condition-, for the application of a previous decision to operate as res judicata to be that the previous decision is made not only by a <ORG> competent to make it but by a <ORG> which be competent to try the subsequent suit. This condition must have been considered necessary in view of the observations of <ORG> in <NAME> Case(1) on account of the hierachy of <ORG>s under the various Acts constituting <ORG>s of civil judicature and it could have been felt that a decision by a <ORG> which is not competent to decide the subsequent suit be not treated of a binding nature. Such an exceptional procedure seems to have been provided as a matter of precaution as the <ORG> not competent to try the subsequent suit must necessarily be a <ORG> of inferior jurisdiction and therefore more liable to go wrong. Whatever the reason may be, the provisions of s. 1 1 will govern a previous decision in a suit barring a subsequent suit with respect to the same matter in controversy and general principles of res judicata in such particular circumstances will neither be available to bar a subsequent suit nor will be needed. It is in such context that the remarks of this <ORG> in <NAME> Case(2) at p. 224 are to be considered. In that case, the decision in a previous suit could not operate as res judicata in accordance with the provisions of s. 11 of the Code, because the parties in the two suits could not be said to be the same parties or parties who claimed through one another. It was then said :

"Where s. 11 is thus inapplicable it would not be permissible to rely upon the general doctrine of res judicata. We are dealing with a suit and the only ground on which res judicata can be urged against such a suit can be the provisions of s. 11 and no other."

The observations are to be read in the context in which they are made, the context being that the question of res judicata was (1) (1882) L.R. 9 I.A. 197. (2) [1962] Supp. 1 S.C.R. 206.

being considered in connection with the decision in a previous suit and the parties in the two suits being not the same. In fact, general principles of res judicata also require that the earlier decision be between the same parties. A decision not inter parties cannot, even on general principles of res judicata, operate as res judicata in a subsequent suit.

We may now refer to some of the decided cases having a bearing on the applicability of the general principles of res judicata to suits, when the previous decision is not in a suit but in other proceedings.

<CITATION> (1) the question was whether a previous order in an administration suit could operate as res judicata with respect to matters which had been decided in the subsequent administration suit instituted for decision of certain matters left open in the previous suit. It was said at p. 193 :

"The question as to the perpetuity had been definitely and properly before him on the former hearing, and was, in fact, decided without any reservation, as is made plain by the terms of the judgment itself, which show that the determination of the dispute as to the perpetuity was the foundation of the whole judgment ... It is not, and indeed it cannot be, disputed that, if that be the case, the matter has been finally settled between the parties, for the mere fact that the decision was given in an administration suit does not affect its finality : see <NAME> v. <NAME> (22 Ch. D. 182). <ORG>, however, took a different view, and regarding the question as still open decided it against the appellant, but the error in their judgment is due to the fact that they regarded the question as completely governed by s. 11 of the Code of Civil Procedure."

and then reference was made to what has been said in <NAME> v. <NAME>) :

"The binding force of such a judgment depends not upon sect. 13, Act X of 1877, but upon general principles of law. If it were not binding there would be no end to litigation." <CITATION> (3) the question arose about the decision about the title to compensation under (1) L.R. 48 I.A. 187.

(3) L.R. 49 I.A. 129.

(2) L.R. 11 I.A. 37, 41.

proceedings in <ORG> operating as res judicata in a subsequent suit with respect to the rights of the parties. It was said at p. 136 :

"When once the award as to the amount has become final, all questions as to fixing of compensation are then at an end; the duty of the Collector in case of dispute as to the relative rights of the persons together entitled to the money is to place the money under the control of the <ORG>, and the parties then can proceed to litigate in the ordinary way to determine what their right and title to the property may be. That is exactly what occurred in the present case. How the proceedings were commenced is a matter that is not material provided that they were instituted in the manner that gave the <ORG> jurisdiction, for they ended in a decree made by the High <ORG> and appealable to this Board."

The Court then referred to what was said in <NAME> v. <NAME> (1) and in <NAME>'s Case(1) and said that the principle which prevents the same case being twice litigated is of general application, and is not limited by the specific words of the Code in this respect. <CITATION> (3) <ORG> held that a decision in contentious proceedings under the Probate and Administration Act , 1881, was binding in a subsequent suit upon the parties to the earlier suit, including a party whose name had been omitted from the formal order made and reiterated that the terms of S. 11 were not to be regarded as exhaustive in regard to what decisions could operate as res judicata.

In Mst. <NAME> v. Mst. <NAME> (4 ) a decision about title in Land Acquisition Act proceedings was held to be res judicata in a subsequent suit about the title between the same parties.

These decisions of <ORG> well lay down that the provisions of s. 11 C.P.C. are not exhaustive with respect to an earlier decision in a proceeding operating as res judicata in a subsequent suit with respect to the same matter inter parties, and' do not preclude the application to regular suits of the general principles of res judicata based on public policy and applied from ancient times. (1) (1909) A.C. 615, 623.

(3) L. R. 57 I.A. 24.

(2) L.R. 48 I.A. 187.

(4) L.R. 66 I.A. 145.

In <NAME> v. <NAME>) it was said "But in view of the arguments addressed to them their Lordships desire to emphasize that the rule of res judicata, while founded on ancient precedent, is dictated by a wisdom which is for all time. 'It hath been well said,' declared Lord <NAME>, 'interest reipublicae ut sit finis litium, otherwise great oppression might be done under colour and pretence of law' : 6 <NAME>, 9a. Though the rule of the Code may be traced to an English source, it embodies a doctrine in no way opposed to the spirit of the law as expounded by the Hindu commentators. <NAME> and Nilakantha include the plea of a former judgment among those allowed by law, each citing for this purpose the text of <NAME>, who describes the plea thus : "If a person though defeated at law sue again he should be answered, 'You were defeated formerly. This is called the plea of former judgment." [See the Mitakshara (Vyavahara), bk. II, ch. 1 edited by <NAME>, p. 14, and the Mayuka, ch. 1., s. 1 , p. 11 of <NAME>'s edition]. And so the application of the rule by the <ORG> in India should be influenced by no technical considerations of form, but by matter of substance within the limits allowed by law."

This Court had to consider the question of the applicability of the general principles of res judicata in several cases and has repeatedly held that this principle is not based on a rule of technicality but is based on high public policy to bring about an end to litigation by giving finality to judgments inter parties and to save a litigant from harassment a second time. The principles laid down by <ORG> have been generally accepted. <CITATION> (2) this Court approved of what was said by <ORG> in <NAME>'s Case(3); <NAME> Case(4) and Mst. <NAME>'s Case(5) and said at p. 166 ". . . and in these circumstances it has to be held that the question of title to the four anna share was necessarily and substantially involved in the land acquisition proceedings and was finally decided by a court having jurisdiction to try it and that decision thus operates as res judicata. . .

(1) L.R. 43 I.A.91, 98.

(2) [1953] S. C. R. 154.

(3) L.R. 48 I.A. 187.

(4) L.R. 49 I.A. 129.

(5) L.R. 66 I.A. 145.

<NAME>

<CITATION> (1) the question arose for the first time about applying the principle of res judicata in writ applications under Art. 32 of the Constitution and this Court said at p. 103 :

"This Court has laid it down in the case of <CITATION> (2) that the principle underlying res judicata is applicable in respect of a question which has been raised and decided after full contest, even though the first Tribunal which decided the matter may have no jurisdiction to try the subsequent suit and even though the subject- matter of the dispute was not exactly the same in the two proceedings. In that case the rule of res judicata was applied to litigation in land acquisition proceedings. In that case the general principles of law bearing on the rule of res judicata, and not the provisions of s. 1 1 of the Code of Civil Procedure, were applied to the case. The rule of res judicata is meant to give finality to a decision arrived at after due contest and after hearing the parties interested in the controversy."

This case made the decision in a former petition under Art. 32 of the Constitution res judicata in the subsequent petition under the same article with respect to the same matter.

In <NAME>'s Case(3) this <ORG> had again dealt with the question of the applicability of the principle of res judicata in writ proceedings. The matter was gone. through very exhaustively and the final conclusions are to be found at p. 592. We may summarise them thus :

1. If a petition under art. 226 is considered on the merits as a contested matter and is dismissed, the decision would continue to bind the parties unless it is otherwise modified or reversed by appeal or other appropriate proceedings permissible under the Constitution.

2. It would not be open to a party to ignore the said judgment and move this Court under art. 32 by an original petition made on the same facts and for obtaining the same or similar orders or writs.

3. If the petition under art. 226 in <ORG> is dismissed not on the merits but because of the laches of the party applying for the writ or because it is held that (1)  S.C.R. 96.

(2) [1953] S.C.R. 154.

(3) [1962] 1 S.C.R. 574.

the party had an alternative remedy available to it, the dismissal of the writ petition would not constitute a bar to a subsequent petition under art. 32.

4. Such a dismissal may however constitute a bar to a subsequent application under art. 32 where and if the facts thus found by <ORG> be themselves relevant even under art. 32.

5. If a writ petition is dismissed in limine and an order is pronounced in that behalf, whether or not the dismissal would constitute a bar would depend on the nature of the order. If the order is on the merits, it would be a bar.

6. If the petition is dismissed in limine without a speaking order, such dismissal cannot be treated as creating a bar of res judicata.

7. If the petition is dismissed as withdrawn, it cannot be a bar to a subsequent petition under art. 32 because, in such a case, there had been no decision on the merits by the <ORG>.

In arriving at the above quoted conclusions the <ORG> made certain observations which are helpful in determining the question in this case about the decision on a writ petition operating as res judicata in a subsequent regular suit. The basis for the rule is described thus at p. 582 :

"But, is the rule of res judicata merely a technical rule or is it based on high public policy ? If the rule of res judicata itself embodies a principle of public policy which in turn is an essential part of the rule of law then the objection that the rule cannot be invoked where fundamental rights are in question may lose much of its validity. Now, the rule of res judicata as indicated in s. 11 of the Code of Civil Procedure has no doubt some technical aspects, for instance the rule of constructive res judicata may be said to be technical; but the basis on which the said rule rests is founded on considerations of public policy. It is in the interest of the public at large that a finality should attach to the binding decisions pronounced by Courts of competent jurisdiction, and it is also in the public interest that individuals should not be vexed twice over with the same kind of litigation."

Again, it was said at p. 584 :

"The binding character of judgments pronounced by courts of competent jurisdiction is itself an essential part of the rule of law, and the rule of law obviously is the basis of the administration of justice on which the Constitution lays so much emphasis."

Limitations to the applicability of this general rule of res judicata are indicated at P. 585 :

"It is true that the general rule can be invoked only in cases where a dispute between the parties has been referred to a court of competent jurisdiction, there has been a contest between the parties before the court, a fair opportunity has been given to both of them to prove their case, and at the end the court has pronounced its judgment or decision. Such a decision pronounced by a court of competent jurisdiction is binding between the parties unless it is modified or reversed by adopting a procedure prescribed by the Constitution. In our opinion, therefore, the plea that the general rule of res judicata should not be allowed to be invoked cannot be sustained."

The <ORG> also said earlier at p. 585 "In other words, an original petition for a writ under Art. 32 cannot take the place of an appeal against the order passed by the High <ORG> in the petition filed before it under Art. 226."

It can be said with equal force that a regular suit for the determination of the matter which had been decided on merits by <ORG> or this <ORG> on a writ petition cannot be given the status of a de facto appeal against the order of <ORG> or of this <ORG>. A solemn declaration and order by the <ORG> in its extra-ordinary jurisdiction is not to be set at nought by a <ORG> of ordinary jurisdiction whose decisions are subject to the appellate or revisional jurisdiction of that <ORG>.

The contention that the remedies available to the petitioners to move <ORG> under art. 226 and this <ORG> under art. 32 are alternate remedies and so the adoption of one remedy cannot bar the adoption of the other, which was urged in the aforesaid case, was negatived, and it was observed at p. 591 "In such a case the point to consider always would be what is the nature of the decision pronounced by a of res judicata altogether in dealing with writ petitions filed by citizens alleging the contravention of their fundamental rights. Considerations of public policy cannot be ignored in such cases, and the basic doctrine that judgments pronounced by this <ORG> are binding and must be regarded as final between the parties in respect of matters covered by them, must receive due consideration." These remarks can apply with greater force when in a regular suit a party desires to obtain an order which may be at variance with the orders pronounced by <ORG> in a writ petition on matters not concerning fundamental rights under the Constitution.

The appellant relies on the case reported as Smt. <NAME> v. <ORG>) in support of its contention that a decision on a writ petition cannot operate as res judicata on the points in dispute between the parties in the civil suit. The decision was based on two grounds : (1) that the jurisdiction of <ORG> under art. 226 and of <ORG> under art. 32 is almost co-extensive, while the jurisdiction of <ORG> under art. 226 and of the civil <ORG> in a regular civil suit cannot be said to be almost co-extensive and (2) that <ORG> in disposing of writs is not required to go into the detailed examination of facts while in regular civil suits facts can be examined meticulously. It was further held that the plaintiff can take such grounds in the civil suit which he could take in a writ petition. A decision of the <ORG> in a writ petition can be res judicata only with respect to the matters which have been decided on merits by <ORG> or by this <ORG>. <ORG>s do not usually enter into disputed questions of fact but there is no bar to their doing so if they feel disposed to enter into such facts and arrive at a conclusion with respect to them. We do not see why all the grounds which can be urged in support of or against a matter raised for decision in a writ petition cannot be urged in the proceedings on it. It is true that the jurisdiction of the civil <ORG> and <ORG> or this <ORG> cannot be said to be Co-extensive, but it is plain that the civil <ORG>, in the exercise of its jurisdiction, is subject to the appellate or revisional jurisdiction of <ORG> and this <ORG>. We do not consider the reasons for holding that a decision in a writ-petition cannot operate as res judicata in a subsequent regular suit to be sound' (1)(1963) 65 Punj. L.R. 945.

Sup./65-3 and are of opinion that the Punjab Case has been wrongly decided.

On the other hand, <ORG> has held in <CITATION> (") that a decision on merits in a writ petition would operate as res judicata in a subsequent suit. As a result of the above discussion, we are of opinion that the provisions of s. 11 C.P.C. are not exhaustive with respect to an earlier decision operating as res judicata between the same parties on the same matter in controversy in a subsequent regular suit and that on the general principle of res judicata, any previous decision on a matter in controversy, decided after full contest or after affording fair opportunity to the parties to prove their case by a <ORG> competent to decide it, will operate as res judicata in a subsequent regular suit. It is not necessary that the <ORG> deciding the matter formerly be competent to decide the subsequent suit or that the former proceeding and the subsequent suit have the same subject matter. The nature of the former proceeding is immaterial. We do not see any good reason to preclude such decisions on matters in controversy in writ proceedings under arts. 226 or 32 of the Constitution from operating as res judicata in subsequent regular suits on the same matters in controversy between the same parties and thus to give limited effect to the principle ,of the finality of decisions after full contest. We therefore hold that on the general principle of res judicata, the decision of the High <ORG> on a writ petition under art. 226 on the merits on a matter after contest will operate as res judicata in a subsequent regular suit between the same parties with respect to the same matter.

We may make it clear that it was not necessary, and we have not considered, whether the principles of constructive res judicata can be invoked by a party to the subsequent suit on the ground that a matter which might or ought to have been raised in the earlier proceeding was not so raised therein. We therefore dismiss this appeal with costs. <NAME> J. I have persued the judgment prepared by my learned brother <NAME>, J. I regret my inability to agree. I shall briefly give my reasons.

<NAME>, J., has stated the facts fully in his judgment. I need not restate them. The few facts relevant to the question (1) A.I.R. 1960 Bom. 196.

raised are these : The appellant filed a petition in <ORG> under Art. 226 of the Constitution raising the question that he was discharged as surety, and <ORG> negatived his contention. In the suit from which the present appeal arises he again raises the plea that he was discharged as surety : in other words, he seeks to reopen in the present suit the finding given by <ORG> in the writ petition. The question is whether the appellant is barred by res judicata to raise the said question in the suit.

Section 11 of the Code of Civil Procedure deals with the doctrine of res judicata in the context of a suit. It says, inter alia, that no <ORG> shall try any suit or issue in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit. To invoke this doctrine, the section lays down many conditions. The most essential condition is that the matter in question should have been directly and substantially in issue in a former suit. The expression "suit" has not been defined in the Code, but S. 26 thereof says that every suit shall be instituted by the presentation of a plaint or in such other manner as may be prescribed. It is not argued that an application under Art. 226 of the Constitution is a suit within the meaning of s. 26 or S. 11 of the Code. It follows, and indeed it is not disputed, that s. 11 of the Code does not bar the appellant from raising the question of the discharge of his suretyship again in the present suit. But it is said that under the general principles of res judicata the <ORG> would be barred to try his suit on the said issue. When the Code of Civil Procedure enacted s. 1  1 prescribing precisely when an earlier decision would be res judicata in a suit, it is not open to invoke the general principles of res judicata in the context of a subsequent suit, though the conditions laid down in the section were not satisfied, for otherwise the section would become nugatory : it would also introduce anomalies. A decision in a previous suit would not be res judicata in a subsequent suit unless the stringent conditions laid down in s. 11 of the Code were satisfied; whereas a decision in a proceeding which was not a suit would be res judicata whether or not the said conditions were complied with. If the fundamental requisites of res judicata were satisfied, a decision, if it fell under s. II of Code, would be res judicata in a subsequent suit; and even if it did not fall thereunder, it would equally be res judicata. That could not have been the intention of the <ORG>.

The cases cited at the <ORG> do not compel me to accept the construction which would lead to that result. The decisions of <ORG> in <CITATION> (1) and Mst. <NAME> v. Mst. Ram Kali(2) and of this Court in <CITATION> (3) may be explained on the ground that the proceeding under s. 18 of the Land Acquisition Act in <ORG> wherein the title of the claimants would be put in issue were in substance a suit. The decision of this Court in <CITATION> (4 ) , <NAME> v. The State of U.P.(5), <CITATION> , Chhindwara(6) and <CITATION> (7) can be distinguished on the footing that the question of res judicata arose in an application either under Art. 226 or Art. 32 of the Constitution and not in a suit., On the other hand, in <NAME> v. <NAME>) this Court definitely ruled :

"Where s. 11 is thus inapplicable it would not be permissible to rely upon the general doctrine of res judicata. We are dealing with a suit and the only ground on which res judicata can be urged against such a suit can be the provisions of S. 1  1 and no other."

These observations, in my view, correctly represent the law on the subject. This view, while it does not make S. 1 1 of the Code of Civil Procedure an unnecessary provision, does not also lead to any practical difficulties, for the decision of <ORG> on a question of law will be binding as an authority on subordinate <ORG> and its decision on a question of fact will rarely be differed from by the said <ORG>.

I would, therefore, hold that the decision given by <ORG> in the writ petition would not preclude the <ORG> from deciding the same question on merits in the present suit. The order of <ORG> is set aside and the appeal is remanded to <ORG> for disposal on merits in accordance with law. Costs will abide the result.

ORDER In accordance with the Opinion of the Majority the Appeal is dismissed with costs.

(1) [1922] L.R. 49 I.A. 129.

(2) L.R. 66 I.A. 145.

(3) [1953]1 S.C.R. 154.

(4) [1961] 1 S.C.R. 96.

(5) [1962] 1 S.C.R. 574.

(6) [1963] Supp. (1) S.C.R. 172.

(7) [1965] 1 S.C.R. 686.

(8) [1962] Supp. 1 S.C.R. 206.


JUDGMENT <NAME>, <NAME>

1. Rule. By consent of learned Counsel for the parties, rule made returnable forthwith and matter is taken up for final disposal. Heard learned Counsel for the petitioner and learned APP for the Respondent.

2. Both matters can be considered and disposed of, by common order, because the issue involved in both the matters, is common.

3. The Petitioner has approached this court, feeling aggrieved by the orders passed by the learned Chief Judicial Magistrate, Aurangabad, ("<ORG>" for short) on 4.3.2008 in Criminal M.A. Nos. 231 and 232 of 2008. Suffice it to say that the petitioner-bank had approached the <ORG> with applications under Section 14 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act , 2002 (" NPA Act " for brevitys sake). The applications are rejected by learned <ORG> with common line of reasons and we quote the observations:

...Therefore, by this application, Petitioner has prayed for assistance in taking possession of secured assets. Heard learned Counsel for the applicant. He relied on 2007 (1) Bom. C.R. (Cri.) 783. On perusal of judgment cited it is seen that there was decree passed by D.R.T. in favour of said Petitioner, who had prayed for such assistance in taking possession of secured assets by filing application before C.M.M. Admittedly, in our case nowhere Petitioner has come with the case that, he has obtained decree in his favour from competent court D.R.T. and in execution of same he is in need of assistance of this criminal Court.

4. Because of the writ petitions filed by the petitioner, we are required to consider the issue;

Whether, a creditor requesting assistance under Section 14(1) of the NPA Act is required to be armed with a decree for recovery of dues from the borrower, from competent court or D.R.T.?

It appears that the judgment rendered by <ORG> at Bombay of this High Court, in the matter of <CITATION> . 2007 (1) Bom. C.R. (cri.) 783, was placed before the learned <ORG> and reading the facts from that judgment, the learned <ORG> has taken a view that in the reported matter, there was a decree passed by <ORG> in favour of the creditor therein (respondent in that writ petition) and because the present writ petitioner, who is creditor and seeking assistance from the <ORG> for taking possession of secured assets as under Section 14(1)(a) of the NPA Act, is not armed with a decree against the borrower, from the competent court or <ORG>, the learned <ORG> felt that the present petitioner is not entitled to assistance of the <ORG> for taking possession of the secured assets. At present, we are concerned with these observations of the learned <ORG>.

5. During the course of his submissions, Advocate Shri <NAME>, has submitted that on going through the entire judgment in the matter of Trade Well (supra), it appears that the court has not laid down a ratio as understood by the <ORG> i.e. assistance under Section 14(1) of the NPA Act cannot be availed by a creditor, unless he is armed with a decree of competent court/DRT. Learned APP <NAME>, upon going through the judgment, has accepted this position.

Even on going through opening part of the judgment, we can gather as to what question court was dealing with. We quote:

The question which arises in these writ petitions is whether while dealing with written request made by a secured creditor under Section 14 of Financial Assets and Enforcement of Security Interest Act (for short, "the NPA Act "), the Chief Judicial Magistrate or the District Magistrate as the case may be is required to give notice to the borrower or any person who may be in possession of secured asset and give him a hearing?

As the court was seized only of this question and no other issue, the observations of the court on any other issue will have to be treated as "obiter dictum" and not "ratio decidendi".

The court has recorded its ten conclusions in paragraph 90 and first four conclusions (1 to 4) pertain to Section 14 , which we reproduce and to which we shall advert little later.

(1). The bank or financial institution shall, before making an application under Section 14 of the NPA Act, verify and confirm that notice under Section 13(2) of the NPA Act is given and that the secured asset falls within the jurisdiction of <ORG> before whom application under Section 14 is made. The bank and financial institution shall also consider before approaching <ORG> for an order under Section 14 of the NPA act, whether Section 13 of the NPA Act excludes the application of Sections 13 and 14 thereof to the case on hand.

(2). CMM/DM acting under Section 14 of the NPA Act is not required to give notice either to the borrower or to the 3rd party.

(3). He has to only verify from the bank or financial institution whether notice under Section 13(2) of the NPA Act is given or not and whether the secured assets fall within his jurisdiction. There is no adjudication of any kind at that stage.

(4). It is only if the above conditions are not fulfilled that the CMM/DM can refuse to pass an order under Section 14 of the NPA Act by recording that the above conditions are not fulfilled. If these two conditions are fulfilled, he cannot refuse to pass an order under Section 14 .

Even on going through all ten conclusions, we do not find the court laying down ratio as understood by learned CJM, Aurangabad.

In fact, in taking a view as recorded by learned CJM, Aurangabad, he has practically set the provisions of the NPA Act , at knot.

6. We may simply reproduce the statement of objects and reasons and certain provisions from the NPA Act which clearly indicate that this is a special legislation enabling the creditor to recover his dues by taking measures as provided in the NPA Act and in the manner as prescribed in the said Act, without getting entangled in the legal process and the delay or time consumption that occurs when a party is required to recover its dues through legal proceedings.

Statement of Objects and Reasons:- The financial sector has been one of the key drivers in Indias efforts to achieve success in rapidly developing its economy. While the banking industry in India is progressively complying with the international prudential norms and accounting practices, there are certain areas n which the banking and financial sector do not have a level playing field as compared to other participants in the financial markets in the world. There is no legal provision for facilitating securitisation of financial assets of banks and financial institutions. Further, unlike international banks, the banks and financial institutions in India do not have power to take possession of securities and sell them. Our existing legal framework relating to commercial transactions has not kept pace with the changing commercial practices and financial sector reforms. This has resulted in slow pace of recovery of defaulting loans and mounting level of non-performing assets of banks and financial institutions. <ORG> and II and <ORG> constituted by <ORG> for the purpose of examining banking sector reforms have considered the need for changes in the legal system in respect of these areas. These Committees, inter alia, have suggested enactment of a new legislation for securitisation and empowering banks and financial institutions to take possession of securities and to sell them without the intervention of the <ORG>. Acting on these suggestions, the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Ordinance, 2002 was promulgated on the 21st June, 2002 to regulate securitisation and reconstruction of financial assets and enforcement of security interest and for matters connected therewith or incidental thereto. The provisions of the Ordinance would enable banks and financial institutions to realise long term assets, manage problem of liquidity asset liability mismataches and improve recovery by exercising powers to take possession of securities, sell them and reduce non-performing assets by adopting measures for recovery or reconstruction.

Section 13 , whichis regarding enforcement of security interest and more particularly Sub-section (1) of it, reads thus;

13. Enforcement of security interest:

(1). Notwithstanding anything contained in Section 69 or Section 69-A of the Transfer of Property Act, 1882 , any security interest created in favour of any secured creditor may be enforced, without the intervention of the <ORG> or tribunal, by such creditor in accordance with the provisions of this Act.

Sub-section (2) of Section 13 of the Act, requires the creditor to give a notice to borrower whose debt is classified by the secured creditor as NPA, inviting the borrower to discharge, in full; his liabilities to the secured creditor, within sixty days from the date of notice and failing which, the secured creditor is held entitled to exercise all or any of the rights under Sub-section (4).

Sub-section (3) requires the secured creditor to give details regarding amount due from the borrower and the secured assets against which the secured creditor desires to proceed, in case of failure on the part of the borrower to comply with notice under Section 13(2) .

Again we may refer to some part of text of Sub-section (4) of Section 13 , and the opening part reads;

In case the borrower fails to discharge his liability in full within the period specified in Sub-section (2), the secured creditor may take recourse to one or more of the following measures to recover his secured debt, namely:

(a). take possession of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale for realising the secured asset;

(b). take over the management of the secured assets of the borrower including the right to transfer by way of lease, assignment or sale and realise the secured asset;

(c). appoint any person (hereinafter referred to as the manager), to manage the secured assets the possession of which has been taken over by the secured creditor;

(d). require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt.

Sub-section (12) of Section 13 reads:

The rights of a secured creditor under this Act may be exercised by one or more of his officers authorised in this behalf in such manner as may be prescribed.

Sub-section (13) practically operates as injunction against the borrower, either from alienating or transferring or creating encumbrance against the secured assets.

On going through the entire Section 13 of the NPA Act, it is clear that it makes no reference to any judicial forum which the secured creditor is required to approach before taking steps, as permitted by Sub-section (4). The only condition required to be fulfilled by secured creditor, is serving of a notice under Section 13(2) . By virtue of insertion of amended Sub-section (3-A), the secured creditor is also required to communicate reasons to the borrower as to why representation of the borrower is not acceptable to the creditor. By reference to text of Sub-section (3-A), it is evident that mere rejection of the representation of the borrower, does not give the borrower a cause of action to approach <ORG> under Section 17 . It is only after the secured creditor takes steps under Section 13(4) that the borrower can approach <ORG>, by an appeal against such an action by secured creditor. On going through the text of the NPA Act , it is evident that no judicial forum comes into picture till that stage.

7. We feel that the statement of objects and reasons in enacting the NPA Act and the provisions quoted hereinabove, are self-eloquent and clearly indicate that the secured creditor is not required to obtain a decree from a competent court/DRT, before being entitled to take steps as permitted by NPA Act for the purpose of enforcement of recovery, by taking steps against the secured assets. We must, therefore, say that the learned CJM, Aurangabad, was completely on wrong foot in observing that the assistance cannot be sought unless there is a decree in favour the secured creditor.

In fact, we may also usefully reproduce Sub-section (1) of Section 14 and more particularly its opening part, just to confirm that even this Sub-section does not speak of requirement of decree in favour of secured creditor.

Chief Metropolitan Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset:

(1). Where the possession of any secured asset is required to be taken by the secured creditor or if any of the secured asset is required to be sold or transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured asset, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate, within whose jurisdiction any such secured asset....

Later half of Sub-section (1) states that the Chief Metropolitan Magistrate ("CMM") or the District Magistrate ("DM"), on such request being made, may take possession of such assets and documents relating thereto and forward such assets and documents to the secured creditor.

Even Section 14 , which can be availed of, by a secured creditor for the purpose of taking possession of secured assets, under the provisions of this Act, which is referable to Section 13(4) , does not speak regarding requirement of any decree of a competent court in favour of the secured creditor. The Act is a special enactment, enabling the secured creditors to stand on their own, so far as the purpose of recovery of the loans is concerned.

8. On reading the text of Section 14(1) repeatedly, during the course of submissions of learned Counsel for the petitioner and learned <ORG>, a new question has struck our mind and that is why we had adjourned the matter on the last occasion. We have drawn attention of learned Counsel for the petitioner to the titles of the authorities referred to in Section 14 . It refers to Chief Metropolitan Magistrate or District Magistrate. Reference to Chief Judicial Magistrate is conspicuously absent. The terminal portion of Section 14(1) reads:

...the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or, as the case may be, the District Magistrate shall, on such request being made to him...take possession.

The authorities are referred thrice in Sub-section (1) of Section 14 . They are also referred in Sub-section (2) and Sub-section (3) of Section 14 , but every time, reference is made to the designations "Chief Metropolitan Magistrate" and "District Magistrate". There is no reference to "Chief Judicial Magistrate". We have, therefore, posed a question to Advocate <NAME> for the Petitioner that Section indicates assistance from <ORG> and <ORG>, within whose territorial limits the secured assets or documents relating thereto are situated at the time secured creditor desires taking possession of the secured assets. There is no reference to the CJM. We have, therefore, expressed that it would be the <ORG>, so far as metropolitan area is concerned and where there is a <ORG> appointed and posted. So far as other area is concerned, there being no post and appointment of <ORG>, secured creditor desirous of availing benefit of Section 14(1) , will have to approach <ORG>.

Advocate <NAME> has not been able to point out any provision in the NPA Act , or Cr.P.C . which will compel us to accept his proposition that, although words used in the section are "CMM/DM", sofar as area beyond metropolitan area is concerned, the words "CMM" can be read as "CJM". The legislature does not seem to have intended to entrust the function to CJM outside the metropolitan area, although the function is entrusted to CMM, a judicial officer, in metropolitan area.

Even on going through Section 3 of the Code of Criminal Procedure, relating to construction of reference and more particularly Sub-sections (2) and (3) of the same, any reference to Judicial Magistrate is required to be read as "Metropolitan Magistrate", insofar as metropolitan area is concerned by virtue of Sub-section (2), but this is only for the purpose of Cr.P.C . and Section 3(2) is not applicable to any other Acts. Sub-section (3) of Section 3 of . relates to other Acts, but which are passed before commencement of the Cr.P.C . Reference in any such enactment to Presidency Magistrate/Chief Presidency Magistrate is required to be construed as reference to Metropolitan Magistrate/Chief Metropolitan Magistrate. This change is necessitated because under Cr.P.C . 1898, the Magistrates in the metropolitan area, which was then called as "Presidency Town", were designated as Presidency Magistrate/Chief Presidency Magistrate and were so referred in the enactments which were passed before coming into force, the Code of Criminal Procedure, 1973.

9. Our attention could not be drawn by either Counsel to demonstrate that the words "CMM" in Section 14 of the NPA Act, can be read as "CJM", sofar as non metropolitan area is concerned, by any stretch of imagination.

We are, therefore, inclined to confirm the order of <ORG>, Aurangabad, rejecting assistance to the petitioner to recover possession of secured assets, although for different reasons. We have arrived at a conclusion that, sofar as non metropolitan area is concerned, powers vest in <ORG> and not with <ORG>, or Judicial Magistrate. Sofar as metropolitan area is concerned, the two authorities are available to the secured creditor, namely, <ORG> and <ORG>. But, so far as non metropolitan area is concerned, the secured creditor will have to approach the <ORG> only, for assistance under Section 14(1) of the Act.

10. While upholding the order passed by the <ORG>, Aurangabad, we have recorded our views on merits and we only record that the <ORG> could not have rejected assistance to the petitioner, if he (<ORG>) otherwise had jurisdiction to entertain such a request, on the ground that the secured creditor is required to be armed with a decree from the competent court. We may say that assistance cannot be refused either by <ORG> or <ORG>, on this ground.

What is required to be done by <ORG> or <ORG>, while considering the request of secured creditor for assistance to take possession of secured assets, is evident from the conclusions at serial Nos. 1 to 4 drawn by <ORG> at Bombay in the matter of Trade Well (supra) and which we have already reproduced in earlier part of this judgment. To state in brief, <ORG> or <ORG> acting under Section 14 , will not be required to serve a notice upon the borrower or a third party. But, the authority will have to verify from the bank/financial institution/secured creditor that the notice under Section 13(2) of the NPA Act is served; that the secured assets are within territorial jurisdiction of the authority concerned; that the borrower has not discharged liability as indicated in the notice under Section 13(2) and that the secured creditor has communicated reasons for rejection of representation, if any, of the borrower. If all these things are fulfilled by the secured creditor, <ORG>/<ORG> will not be in a position to refuse assistance under Section 14(1) to the secured creditor.

11. We, therefore, dispose of the writ petitions, by confirming refusal by <ORG>, Aurangabad, of assistance under Section 14(1) , not because the petitioner-creditor was not armed with a decree of a competent court, but because the <ORG> does not have power to render such assistance. We clarify that it will be open for the petitioner to approach the <ORG> and refusal of assistance under Section 14(1) of the Securitization Act, by <ORG>, Aurangabad, will not be an impediment in <ORG> providing such assistance to the petitioner/secured creditor upon demonstration by the secured creditor, of fulfilment of requirement as under Section 13(2) and 13 (3- A) of the Act .

12. Writ Petitions are disposed of and rule made absolute, in above terms.