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CASE NO.:

Appeal (civil) 2592-2593 of 2000

PETITIONER:

AANAIMUTHU THEVAR (DEAD) BY LRS.

RESPONDENT:

ALAGAMMAL & ORS.

DATE OF JUDGMENT: 12/07/2005

BENCH:

D. M. Dharmadhikari & Tarun Chatterjee

JUDGMENT:

J U D G M E N T

Dharmadhikari J.

In these two appeals arising out of the impugned common

judgment passed by the High Court of Madras in Second Appeal, the

neat question involved is one of res judicata. The trial court in its

common judgment passed in cross suits jointly tried came to the

conclusion that the judgment in former suit OS No. 843/74 between

the predecessor-in-title of the appellant and the respondents cannot

operate as res judicata to bar the present suit claiming title to the suit

property by the appellant. The High Court by the impugned common

judgment in Second Appeal has reversed the judgment of the two

courts below and held that the judgment in former suit OS No.843/74

decided on 28.2.1976 operates as res judicata under section 11 of the

Code of Civil Procedure. Consequently, the suit filed by the appellant

has been dismissed and the cross suit filed by the respondents has

been decreed.

The facts necessary for deciding the issue of res judicata are as

under:-

The property involved in the two cross suits is house door

No.206 in Harvaipatt township in Madurai, South Taluk. The house

was allotted by Madurai Mills Cooperative Housing Society to mother of

Muthuswami Naidu (the husband of respondent No.1 and father of

respondents 3 to 7). After the death of mother, the formal document

of conveyance by the Housing Society came to be issued in favour of

Muthuswami Naidu on 15.3.1975. Muthuswami Naidu executed a

mortgage deed on 3.12.74 for raising a loan of Rupees three thousand

from one Chhinnaswamy who was co-plaintiff with him in the former

suit OS No. 843 of 1974.

Muthuswami Naidu as the mortgagor under mortgage deed

dated 3.12.1974 and Chinnaswamy as the mortgagee jointly filed civil

suit as OS No. 843/74 in the court of District Munsiff, Thirumangalam

against respondent Alagammal (the wife of Muthuswami respondent

No.1 herein). The mortgagor and mortgagee filed suit simplicitor for

seeking permanent injunction to restrain the respondent wife of

Muthuswami from interfering with the possession of the suit house on

the ground that it was owned and possessed by them.

The aforesaid suit OS No.843/74 was resisted by the respondent

wife pleading inter alia that when disputes had arisen in the married

life of the parties, a village panchayat was called in the year 1971 in

which the respondent agreed to relinquish his ownership of the suit

house in favour of his wife and children for their residence on the

condition that his wife would discharge dues against the house. In

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that suit the wife denied the existence of any alleged mortgage deed

and questioned validity of the same.

On the pleadings of the parties in the former suit OS No.843/74,

the following issues were framed:-

1) Whether the othi deed (mortgage deed) dated 3.12.1974

executed in favour of the second plaintiff is true, valid and

binding upon the defendant?

2) Whether the plaintiffs are entitled to the relief of injunction

prayed for?

3) Whether the defendant was in possession of the suit property?

4) Whether the suit is bad for non-joinder of a necessary party?

5) Whether the alleged settlement pleaded by the defendant is

true?

6) To what relief, if any, are the plaintiffs entitled?

On the first issue, the trial court held that registered mortgage

deed seemed to be genuine but it was not binding as mortgagor had

failed to enter the witness box to prove it. On issue Nos.2 & 3, the

trial court answered them in favour of the respondent wife by

recording a finding that she had proved to be in possession of the suit

house. Tax receipts evidencing payment of house tax were relied in

proof of her possession. On thee findings, it was held that relief of

permanent injunction to restrain the respondent wife from enjoying

the suit property could not be granted. On issue no. 4 regarding the

alleged settlement reached in village panchayat and relinquishment of

ownership and right by Muthuswami in the suit house in favour of his

wife and children, the trial court recorded a finding that fact of such

settlement in panchayat had been proved. The finding recorded in the

words of the trial court is as under:-

"In as much as the possession of the defendant on the date of the

suit having been established and no evidence having been let in by the

plaintiffs to disprove the allegation that the property was settled

upon the defendant in a panchayat which was held about 4 years ago.

It has to be held that settlement pleaded by the defendant is true. I

answer this issue in favour of the defendant."

Issue No.4 on non-joinder of children as parties to the suit, was

also decided in favour of the defendant. It was held that in the

Panchayat settlement, the husband relinquished the property in favour

his wife and children. Therefore, children were necessary parties and

the suit was bad for mis-joinder of a necessary party.

The aforesaid judgment with decree of the trial court at

Thirumangalam in suit OS No.843/74 was not appealed against by

Muthuswami Naidu, the husband or his mortgagee and has attained

finality.

After the judgment and decree against him in the above

mentioned suit OS No. 843/74, Muthuswami Naidu sold the suit house

by registered sale-deed at 15.3.1975 in favour of Annaimuthu Thevar

the appellant herein. On the basis of his purchase, the present

appellant instituted civil suit OS No.335/83 seeking declaration of his

title and possession from respondent and her children.

The respondent wife jointly with her children filed cross suit

registered OS No.202/84 seeking permanent injunction against the

present appellant claiming ownership of the suit house under the

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settlement of the year 1971 in panchayat and the consequent

judgment and decree passed inter se between her and her husband

Muthuswami in civil suit OS No.843/74 decided on 28.2.1976. The

cross suits were jointly tried and decided by common judgments giving

rise to two appeals before the first appellate court and two second

appeals before the High Court which have all been decided by

common judgments.

The trial court and the first appellate court by common

judgments delivered by them respectively rejected the plea of res

judicata raised by the respondent wife and her children on the ground

that in the former suit OS No. 843/74 the question of title to the suit

house was neither directly nor substantially involved and decided. The

trial court and the first appellate court, therefore, decreed the suit of

the present appellant and dismissed the cross suit of the wife and

children.

The High Court in the two Second Appeals by the impugned

judgment, however, took a contrary view and reversed the judgments

of the courts below. On examining the counter pleas and the judgment

of the trial court in the former suit between the husband and wife, the

High Court came to the conclusion that the bar of res judicata squarely

applied to the subsequent suit filed by the purchaser of the suit

property from the husband of the respondent wife. According to the

learned Judge of the High Court in the former suit, the right and title

of husband Muthuswami to the suit house was substantially involved

which was negatived and the right of the wife and children was upheld.

The finding of res judicata recorded by the High Court needs to be

reproduced as arguments have been addressed on it by the learned

counsel on either side before us in these appeals :-

"In the earlier judgement right and title of Muthuswami had been

negatived and that of Alagammal and her children were upheld.

Therefore it follows that the plaintiff in the present suit claiming

title through Muthuswami cannot be sustained as by the earlier

judicial determination right, title and interest of Alagammal and her

children had been upheld and that of Muthuswami had been

negatived. The earlier decision namely Ex.B.14 and B.15 definitely

constitutes res judicata. That apart, a finding in the earlier suit that

Muthuswami has no title or interest in the suit property and

Alagammal and her children are the owners was the decision which

had been directly and substantially necessary for the disposal of the

suit O.S. No. 843 of 1974 and therefore it has to be held that the

issue in the earlier suit in which the matter was directly and

substantially an issue constitutes res judicata."

The High Court placed reliance on the decisions of this Court

reported in Sulachana Amma vs. Narain Nair [1994 (2) SCC 14];

Ishar Singh vs. Sarwan Singh [AIR 1965 SC 948]; and Jumma

Masjid vs. Kodimaniandra Deviah [AIR 1962 SC 847].

Learned counsel appearing for the appellant after taking us

through the issues and findings recorded by the trial court in the

former suit OS No.843/74 contended that question of title to the suit

house was neither expressly nor substantially involved in the said suit

and therefore the judgment cannot operate as res judicata in the

subsequent suit. The contention advanced is that the suit was filed on

the basis of a mortgage deed executed on 3.12.1974 by Muthuswami

in favour of Chinnaswamy. In that suit jointly filed, Muthuswami was

not examined to prove the mortgage deed and hence decree of

permanent injunction was refused on a finding that the respondent

wife and her children were in possession of the suit house on the basis

of the alleged settlement in village panchayat which was reached for

resolving family dispute between Muthuswami Naidu - the husband

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and his wife the respondent.

On the other side, learned counsel appearing for the respondent

wife and her children supported the judgment of the High Court by

contending that the former suit was for permanent injunction on the

basis of right claimed by Muthuswami Naidu as owner of suit house

with competence to execute a mortgage deed in favour of

Chinnaswamy plaintiff No.2 in that suit. The suit for injunction

substantially was based on the claim of ownership of the suit house by

the mortgagor and the right to remain in undisturbed possession by

the mortgagee. It is, therefore, contended that the issue of title was

directly and substantially in issue in the former suit. Alternatively, it is

argued that doctrine of constructive res judicata in accordance with

Explanation IV to section 11 of the Civil Procedure Code clearly barred

the subsequent suit filed by the purchaser from Muthuswami. Reliance

is placed on AIR 1966 SC 1061 and 1997 (2) SCC 552.

The main legal question that requires decision is whether the

judgment in the former suit directly or constructively operates as res

judicata in the subsequent suits which have given rise to these

appeals.

The undisputed facts are that the house in suit was initially

allotted to the mother of Muthuswami by Madurai Mills Co-operative

Housing Society. After the death of his mother, Muthuswami as son

inherited the right in the house. The house was in possession of the

family of Muthuswami. According to the case of the respondent wife,

Muthuswami was a spendthrift and had wayward habits. As pleaded in

the former suit, differences and family disputes arose between

Muthuswami and her. In the year 1971, a village panchayat was held

in which Muthuswami agreed to relinquish his right of ownership in the

suit house in favour of his wife and children. However, pursuant to the

decision of the panchayat and the commitment made by the husband

in the course of panchayat proceedings, no formal document of

conveyance came to be executed in favour of the wife.

Instead of honouring the commitment made in thevillage

panchayat, Muthuswami executed the registered deed of mortgage on

3.12.1974 in favour of Chinnaswamy. Muthuswami as the mortgagor

and Chinnaswamy as the mortgagee jointly filed the former suit OS

No. 843 of 1974 against Alagammal wife of Muthuswami, for seeking a

decree of permanent injunction simplicitor. The foundation of the suit

as appears from the judgment, was that Muthuswami as the owner of

the suit house had executed a mortgage with delivery of possession to

Chinnaswamy. The cause of action for the suit seeking mandatory

injunction was alleged to have arisen as the wife of Muthuswami was

asserting her right to the suit house and interfering with their

possession. The aforesaid former suit was resisted by Alagammal

mainly on the ground that in the village panchayat her husband had

relinquished his right of ownership of the suit house in her favour and

their children for their residence. She also denied the existence and

validity of the registered mortgage deed.

The issues framed in the former suit have been reproduced

above. No specific issue seems to have been framed on title or

ownership of the suit house but the issues raised on the existence and

validity of the mortgage deed and the fact or otherwise of the alleged

settlement pleaded by the defendant in the village panchayat

substantially involved decision on claim of right and ownership of the

house by the husband. The other issue raised was concerning the

dispute as to who was in possession of the suit house.

As is apparent from the judgment in the former suit,

Muthuswami, who was claiming to be the owner and the mortgagor,

did not enter the witness box either to prove the execution of the

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mortgage or to deny the case pleaded by his wife that he had

relinquished his right in the suit house in the settlement reached in the

village panchayat. The suit jointly filed by Muthuswami as

owner/mortgagor and Chinnaswamy as mortgagee was dismissed on

findings inter alia that mortgage was not proved and that in village

panchayat, a settlement had indeed taken place in favour of wife and

children who were in possession. It was also held that the children

were necessary parties to the suit and their non-joinder was fatal to

the suit. The dismissal of the suit filed by Muthuswami as mortgagor

and Chinnaswamy as mortgagee against wife of the former was not

appealed against by either of the plaintiffs. The same, therefore,

attained finality.

The present cross suits arose when Muthuswami, after obtaining

a formal conveyance deed of the house from the housing society on

15.3.1975, executed a registered deed of sale of the suit house on

28.2.1983 in favour of the present appellant.

The present two appeals arise out of the cross suits - the one

filed by the purchaser on the basis of registered sale deed in his favour

on 28.2.1983, against the wife of Muthuswami and her children. The

other suit was filed by wife of Muthuswami and her children seeking

injunction against her husband and the present appellant as purchaser

from him.

On these above undisputed facts, the main argument advanced

by the learned counsel for the appellant is that at the time of filing of

the former suit, Muthuswami had neither any transferable title nor any

right to execute a mortgage. He became owner of the suit house only

on 15.3.1975 when a formal deed of conveyance was executed in his

favour by the housing society. It is also submitted that in the former

suit, there was no issue of title or ownership of the suit house directly

or substantially involved. The findings and the judgment in the former

suit against Muthuswami and the alleged mortgagee rested on the

grounds of non-proof of mortgage deed, fact of settlement in village

panchayat and possession of the house to be with the wife and

children. Non-joinder of children as parties to the suit was also

additional ground to dismiss the former suit. The present subsequent

suit is founded on the registered sale deed executed on 28.2.1983 by

Muthuswami after he had obtained a saleable title under formal deed

of conveyance from the Housing Society on 15.3.1975.

On the other side, learned counsel appearing for the wife

Alagammal and her children supported the judgment on doctrine of res

judicata as applied by the High Court to the subsequent suits. He

contends that in the issues framed in the former suits, the question of

title and ownership of the suit house were substantially involved. In

any case, the doctrine of constructive res judicata applies under

explanation IV to section 11 of the Code of Civil Procedure to the

present case.

Section 11 of the Code which contains the doctrine of res

judicata states :-

"11. Res judicata.- No court 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 Court competent to try such subsequent

suit or the suit in which such issue has been subsequently raised, and

has been heard and finally decided by such Court."

[Emphasis added]

The main part of section 11 undoubtedly applies. The former suit

was jointly filed by Muthuswami as owner and mortgagor with the

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mortgagee. The subsequent suit is by the appellant who is purchaser

from Muthuswami. The present appellant is, therefore, litigating under

the same title which Muthuswami had in the suit house.

The next question that arises is whether the issue of ownership

and title in the suit house was directly and substantially in issue in the

former suit or not. In the subsequent suit undoubtedly the foundation

of claim is title acquired by the present appellant under registered sale

deed dated 28.2.1983 from Muthuswami.

If we examine the nature of claim and pleadings in the former

suit of Muthuswami as mortgagor and plaintiff No. 2 the mortgagee,

the suit appears to be based on the alleged right of Muthuswami as

the owner to execute the mortgage. The decree of mandatory

injunction in the former suit was sought on the ground that

Muthuswami could execute a valid mortgage with possession in favour

of the mortgagee and defendant wife had no right or title, whatsoever,

to interfere with the possession of the plaintiffs. The suit was resisted

by the wife Alagammal on the ground that she had been placed in

possession of the suit house with her children for their residence on

the alleged settlement reached in the village panchayat in the year

1971 in which her husband relinquished his right in the suit house in

their favour. True it is, that relinquishment of an immovable property

cannot be validly made without a written and registered document. It

seems from the conduct of Muthuswami that he had no courage to

enter the witness box in the former suit to face the cross-examination

on behalf of the wife on the existence of alleged settlement in the

village panchayat and relinquishment by him of his right in the suit

house. It is apparent that he wanted to wriggle out of that settlement

reached in village panchayat. As a first attempt in that direction he

executed a mortgage deed to enable the mortgagee to institute a suit

against his wife to dispossess her and deprive her of the right in the

house which Muthuswami had earlier agreed to grant to her in the

village panchayat. Having failed in the joint suit filed by him with his

mortgagee, he did not prosecute the litigation any further and

preferred no appeal. As a second attempt to deprive his wife and

children of right in the house, he executed a registered sale deed in

the year 1983 in favour of the present appellant. The aforementioned

sale deed was executed after he had obtained a document of

conveyance from the housing society and that he could obtain being

an heir his late mother who was the original allottee of the house from

the housing society. The present subsequent suit has been filed by the

present appellant who is purchaser by registered deed dated

28.2.1983 obtained from Muthuswami.

The former suit in which decree of permanent injunction was

sought was clearly founded on the claim of Muthuswami as the owner

of the suit house to execute a mortgage. The issue of title or

ownership of the suit house was thus directly or substantially involved

in the former suit.

We find sufficient force in the alternative contention advanced on

behalf of wife Alagammal and her children that doctrine of constructive

res judicata, as contained in explanation IV to section 11 of the Code

certainly, can be invoked against the present appellant, who claims by

a purchase from Muthuswami. Explanation IV to section 11 of the

Code states :-

"Explanation IV.-Any matter which might and ought to have been

made ground defence or attack in such former suit shall be deemed

to have been a matter directly and substantially in issue in such suit."

In the former suit, respondent Alagammal wife of Muthuswami

clearly set up her own right of ownership to the suit house on the basis

of settlement and relinquishment of the suit house in her favour by the

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husband in the village panchayat. Claim of such ownership and title

might have been found ineffectual in law, as pursuant to such oral

relinquishment in village panchayat, the husband did not execute any

formal written and registered document. On the aforesaid plea of wife

Alagammal, in the former suit in which she had set up claim of

ownership of the suit house on the relinquishment of right by her

husband in village panchayat, it was open to her husband Muthuswami

and his mortgagee to raise a counter plea that the alleged oral

relinquishment in village panchayat was ineffectual in law and

conferred no title on her.

In the former suit the wife had claimed to be in possession with

her children of the suit house pursuant to the settlement reached with

her husband in the village panchayat. In the former suit, in reply to

the plea of the wife, it was open to the plaintiffs to alternatively seek a

decree of possession on the basis of their title to the suit house.

On the date of former suit, true it is that there was no formal

document of conveyance of the suit house executed by the society in

favour of Muthuswami. There existed on that date merely a right he

had inherited in the house allotted to her late mother. Between an

allottee of the house from the housing society and the person merely

in occupation as licencee or member of the family, the allottee has a

better title. In the former suit, the claim of Muthuswami was as an heir

of his late mother who was the allottee of the house and was in

possession. As against him, the claim set up by his wife was of an oral

relinquishment by Muthuswami in her favour in village panchayat.

Between these two competing claims of ownership and right of

possession of the suit house, the husband certainly had a better right

to remain in possession and, if dispossessed, to claim possession. This

ground of seeking possession and permanent injunction was available

to Muthuswami against his wife in support of his joint claim with his

mortgagee. The aforesaid plea founded on ownership and mortgage

having not been raised in the former suit, the doctrine of constructive

res judicata under explanation IV to section 11 of the Code is clearly

attracted.

We can not prepared to accept the argument advanced on behalf

of the above appellant as the successor-in-title of Muthuswami that in

the absence of formal deed of conveyance of the suit house by the

housing society in favour of Muthuswami, the issue of title to the suit

house could neither be raised nor was raised in the former suit. On the

examination of case pleaded by the parties in the former suit and the

judgment rendered therein we find that the plea of ownership to the

suit house was substantially involved for seeking relief of permanent

injunction. Undoubtedly, such plea of ownership could and ought to

have been raised in the former suit. Therefore, this subsequent suit

filed by the present appellant as purchaser from Muthuswami is barred

by constructive res judicata and the High Court was right in holding

accordingly. See the following observations of this Court in the case of

Sulochana Amma v. Narayan Nair, (1994) 2 SCC 14 :-

"(It was) contended that the remedy of injunction is an equitable

relief and in equity, the doctrine of res judicata cannot be extended

to a decree of a court of limited pecuniary jurisdiction. We find no

force in the contention. It is settled law that in a suit for injunction

when title is in issue for the purpose of granting injunction, the issue

directly and substantially arises in that suit between the parties.

When the same issue is put in issue in a later suit based on title

between the same parties or their privies in a subsequent suit the

decree in the injunction suit equally operates as res judicata."

For the reasons aforesaid, these two appeals preferred by the

appellant are dismissed and the judgment of the High Court is upheld.

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In the circumstances, we make no order as to costs in these

appeals.