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CASE NO.:

Appeal (civil) 8246 of 2004

PETITIONER:

Bhanu Kumar Jain

RESPONDENT:

Archana Kumar & Anr.

DATE OF JUDGMENT: 17/12/2004

BENCH:

N. Santosh Hegde, B.P. Singh & S.B. Sinha

JUDGMENT:

J U D G M E N T

(Arising out of S.L.P. (C) No. 6392 of 2003)

S.B. SINHA, J.

Leave granted.

The remedies available to a defendant in the event of an ex-parte

decree being passed against him in terms of Order 9 Rule 13 of the Code of

Civil Procedure (Code) and the extent and limitation thereof is in question

before us in this appeal which arises out of a judgment and order dated

19.12.2002 passed by the High Court of Madhya Pradesh at Jabalpur in First

Appeal No. 109 of 1986.

The fact of the matter relevant for the purpose of this appeal is as

under:

One Shri N.N. Mukherjee was the owner of the premises in suit. He

died leaving behind his wife Smt. Suchorita Mukherjee, (original defendant

No. 1), son Shri P.P. Mukherjee, (original plaintiff) and daughter Smt.

Archana Kumar, (original defendant No. 2). The family is said to be

governed by Dayabhag School of Hindu Law. The original plaintiff filed a

suit for partition in the year 1976. The original defendants filed their written

statements. Respondent No. 2 herein, Surender Nath Kumar who is husband

of Smt. Archana Kumar, Respondent No. 1 herein also filed a written

statement and counterclaim by setting up a plea of mortgage by deposit of

title deeds in respect of property in suit said to have been created by his

mother in law (original defendant No. 1).

Smt. Suchorita Mukherjee died on 15.9.1984 whereupon Respondent

No. 1 herein was transposed as defendant No. 1; whereas Respondent No. 2

was transposed as defendant No. 2 therein. In the suit, the defendant No. 1

did not file any document. Respondent No. 2 also did not file any document

in support of his purported counter claim.

Having regard to the rival contentions raised in the pleadings of the

parties, the following issues were framed:

"1(a) Whether partition of property owned by late

Shri NN Mukherjee had taken place during his life

time?

(b) If so, what property was available for partition?

(c) What were the shares allotted to the Plaintiff

and the defendant No. 1 in the said partition?

(d) Whether the Plaintiff had separated from his

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father during his life time and was in separate

possession of his share in the property?

2. Whether the Plaintiff is entitled to = share and

separate possession of his share in the property

described in para 3 of the plaint?

3. Whether the plaintiff is entitled to claim mesne

profits for the income derived by the defendant

No. 1 from the share in the property? If so, at what

rate and to what sum?

4. Whether the claim in suit is barred by

limitation?

5. Whether the decision in Civil Suit No. 63-A of

1972 decided on 22.11.75 by IInd Civil Judge,

Class II, Jabalpur will operate as res-judicata in the

present case?

(a) Whether the suit is not maintainable as no relief

has been sought against defendant No. 2?

(b) Whether at the request of Defendant No. 1,

Defendant No. 3 spent Rs. 21000/- till 31.10.74 on

construction and alteration of the suit property and

the interest as on 31.10.74 came to Rs. 10,000.00?

(c) Whether in order to secure the above amount

defendant No. 1 deposited the title deeds of the suit

property with defendant No. 2 and created a

mortgage by deposit of title deeds in favour of

defendant No. 3 and the suit property stands

mortgaged with the defendant No. 3?

(d) Whether defendant No. 3 further spent Rs.

9500/- in the year 1976, 1977 and 1980 and

defendant No. 2 spent Rs. 10500.00?

(e) Whether defendant No. 3 is entitled to get

declaration shown as in para 6(A)(B)(C) of the

written statement of defendant No. 3?

(f) Whether the mother of defendant No. 2 had

made will in favour of defendant No. 2 and thus,

after the death of mother defendant No. 2 became

absolute owner and plaintiff has no right?

(g) Whether the plaintiff had already separated in

the year 1951 and thus he has no right over the suit

property?

6. Relief & Costs?"

An additional issue was framed on 13.6.1985 and the case was fixed

for evidence on 3.8.1985. On 3.8.1985 nobody was present on behalf of the

defendant but the plaintiff's advocate was present whereupon, the case was

directed to be placed after some time. At 2.35 p.m. a request was made for

adjournment on the ground that the defendant could not come from Delhi

whereafter an application was filed by the plaintiff that he had closed his

evidence. It was further contended that the burden to prove the additional

issue rested on the defendant and if any evidence is to be adduced, he should

adduce evidence first. It appears that the plaintiff was also not cross-

examined by Respondent No. 1 herein. As the plaintiff was attending to the

court proceedings from Calcutta, a cost of Rs. 200/- was imposed on the

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defendants. It was further directed that if the costs were not paid, the right

of cross-examination will be closed. The matter was again posted on

7.10.1985 on which day again the counsel for the defendant was not present.

Even the costs awarded against them was not paid. Having regard to the fact

that the Respondent No. 1 herein was absent and did not cross-examine the

plaintiff; the case was directed to be posted ex-parte against her and the right

of cross-examination was forfeited. The case was fixed for final argument

on 11.10.1985. Yet again on 11.10.1985 the plaintiff was present but the

defendants were not. Allegedly, owing to strike of the advocates the case

was adjourned for 14.10.1985. On 14.10.1985 the learned Judge fixed the

case for 25.10.1985 for delivery of judgment. The judgment, however, was

not pronounced on 25.10.1985. However, on the next date, viz., 30.10.1985,

an application was filed by the Respondents herein purported to be in terms

of Order 9, Rule 7 of Code for setting aside the order dated 7.10.1985

whereby the suit was posted for ex-parte hearing. The said application was

rejected by an order dated 31.10.1985. A preliminary decree for partition,

thereafter was passed on 1.11.1985 in favour of the plaintiff.

An application under Order 9, Rule 13 of Code was filed by the

Respondents herein on 5.11.1985 which was marked as Misc. Judicial Case

No. 30/1985. The said application was dismissed by an order dated

15.1.1986 by the 6th Additional District Judge, Jabalpur holding that the

defendants failed to prove good and sufficient cause for their absence on

7.10.1985. An appeal marked as Misc. Appeal No. 19/86 thereagainst in

terms of Order 43, Rule 1(d) of the Code was filed on 30.1.1986 which was

also dismissed.

A Civil Revision Application was also filed challenging the order

dated 31.10.1985 whereby and whereunder the Respondents' application

under Order 9, Rule 7 of Code was dismissed. The said petition was also

dismissed. Yet again a regular First Appeal being No. 109/86 was filed in

the High Court. It is contended that the Respondent No. 2 did not file any

appeal against the rejection of his counter claim. The said Misc. Appeal No.

19/86 was dismissed by an order dated 5.4.1994 whereagainst a Special

Leave Petition was filed which also came to be dismissed as withdrawn by

an order dated 16.12.1994. In the meanwhile, it appears that the original

plaintiff transferred his right title and interest in favour of the present

Appellant. The plaintiff died on 1.5.2001. By reason of the impugned

judgment, the High Court allowed the First Appeal No. 109/86 holding:

"i. That the Trial Judge has grossly erred in law

by proceeding ex-parte against the defendants.

ii. The learned counsel further canvassed that

the appellant No. 2, Surendra Kumar, filed the

counter claim and therefore it was incumbent upon

the learned trial judge to decide the counter claim

filed by the defendant in view of the mandate

contained in Order 8 Rule 6(D) of the Code."

Mr. Anup G. Choudhary, learned senior counsel appearing on behalf

the Appellant would submit that as the counter claim filed by the defendants

under Order 8 Rule 6(D) of the Code was dismissed by the learned Trial

Judge, the First Appeal should not have been entertained by the High Court

at the instance of the Respondent No. 2 and, thus, the impugned judgment

must be set aside.

The learned counsel would urge that the subject matter of an

application under Order 9, Rule 13 of the Code and the subject matter of the

appeal being same, it is against public policy to allow two parallel

proceedings to continue simultaneously. Reliance in this behalf has been

placed on Badvel Chinna Asethu and another Vs. Vettipalli Kesavayya and

another [AIR 1920 Madras 962], Munassar Bin Jan Nisar Yarjung (died) his

L.Rs Marian Begum and others Vs. Fatima Begum and others [AIR 1975 AP

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366], M/s. Mangilal Rungta, Calcutta Vs. Manganese Ore (India) Ltd.,

Nagpur [AIR 1987 Bombay 87], Dr. M.K. Gourikutty and etc. Vs. M.K.

Raghavan and Others [AIR 2001 Kerala 398], Rani Choudhury Vs. Lt.-Col.

Suraj Jit Choudhury [(1982) 2 SCC 596] and P.Kiran Kumar Vs. A.S.

Khadar and Others [(2002) 5 SCC 161].

In any event, Mr. Choudhari would contend that the Respondents'

claim would be hit by the doctrine of Issue Estoppel. Reliance in this behalf

has been placed on Y.B. Patil and Others Vs. Y.L. Patil [(1976) 4 SCC 66],

Vijayabai and Others Vs. Shriram Tukaram and Others [(1999) 1 SCC 693]

and Hope Plantations Ltd. Vs. Taluk Land Board, Peermade and Another

[(1999) 5 SCC 590].

As regard the counter claim of Respondent No. 2 herein, Mr.

Choudhari would contend that the same was directed only against his mother

in law being the original defendant No. 1, and, thus, it could not have been

enforced against the plaintiff. The learned counsel in this connection has

drawn our attention to Issue No. 5 framed by the learned Trial Judge.

Drawing our attention to the judgment of the learned Trial Judge, it was

argued that the High Court committed a manifest error in coming to the

conclusion that the learned Trial Judge did not determine the counter claim

which in fact was done.

Mr. Ranjit Kumar, learned senior counsel appearing on behalf of the

Respondents, on the other hand, would contend that the Respondents were

entitled to maintain an appeal against the ex-parte decree in terms of Section

96(2) of the Code. The learned counsel would argue that the High Court in

its impugned judgment having arrived at a conclusion that the suit was

directed to be proceeded ex-parte only against Respondent No. 1 and not

against the Respondent No. 2; he was entitled to raise a contention as

regards the legality or validity of the order dated 31.10.1985. It was further

submitted that in any event, Respondents herein were entitled to assail the

judgment on merit of the matter. Drawing our attention to the provisions of

Order 8, Rule 10 of the Code, the learned counsel would contend that even

in a case where no written statement is filed, the Court may direct the parties

to adduce evidence in which event the Court must pass a decree only upon

recording a satisfaction that the plaintiff has been able to prove his case. If

on the basis of the materials on record, Mr. Ranjit Kumar would urge, the

plaintiff fails to prove his case, the judgment would be subject to an appeal

in terms of Section 96(2) of the Code which confers an unrestricted statutory

right upon a party to a suit.

The learned counsel would further contend that the Appellant herein

has no locus standi to maintain this appeal as upon the death of the original

plaintiff he was not substituted in his place. Mr. Ranjit Kumar would submit

that, in the event if it be held that the Respondents are not entitled to

question the order of the learned Trial Judge to pass an ex-parte decree

against both the Respondents, the matter may be remitted to the High Court

for a decision on merit of the matter.

In reply, Mr. Choudhari would point out that only two contentions

were raised before the High Court and its findings thereupon being ex facie

erroneous, no purpose would be served by remitting the matter back to the

High Court for determination of the merit of the matter. It was argued that

the Respondents have not raised any contention on merit of the matter and in

any event, they having not adduced any evidence, there is no material on the

record of the appeal enabling the court to determine the same on merit. It

was further contended that even the deed in terms whereof the purported

mortgage was created was not annexed with the written statement of the

Respondent No. 2 as it was mandatorily required under Order 8, Rule 1 of

the Code, he cannot raise any contention on merit of the counter claim and

furthermore even no evidence was produced in support thereof.

Order 9, Rule 7 of the Code postulates an application for allowing a

defendant to be heard in answer to the suit when an order posting a suit for

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ex-parte hearing was passed only in the event, the suit had not been heard as

in a case where hearing of the suit was complete and the court had adjourned

a suit for pronouncing the judgment, an application under Order 9, Rule 7

would not be maintainable. (See Arjun Singh Vs. Mohindra Kumar and

others, AIR 1964 SC 993) The purpose and object of Order 9, Rule 7 of the

Code has been explained by this Court in Vijay Kumar Madan and Others

Vs. R.N. Gupta Technical Education Society and Others [(2002) 5 SCC 30]

and Ramesh Chand Ardawatiya Vs. Anil Panjwani [(2003) 7 SCC 350]

It is true that the suit was not directed to be heard ex-parte against

Respondent No. 2 herein but it remains undisputed that both the

Respondents filed application for setting aside the ex-parte decree before the

learned Trial Judge, preferred appeal against the judgment dismissing the

same as also filled a revision application against the order dated 31.10.1985

setting the suit for ex-parte hearing. The said applications and appeal had

been dismissed. Even a Special Leave Petition filed was dismissed as

withdrawn. In that view of the matter it is not permissible for the

Respondents now to contend that it was open to the Respondent No. 2 to

reagitate the matter before the High Court. The contention which has been

raised by the Respondent No. 2 before the High Court in the first Appeal,

furthermore, was not raised in the said application under Order 9, Rule 13 of

the Code and even in the Misc. Petition and the Revision Application filed in

the High Court. Such a question having not been raised, in our opinion, the

Respondents disentitled themselves from raising the said contention yet

again before the High Court in the First Appeal.

It is now well-settled that principles of res judicata applies in different

stages of the same proceedings. [See Satyadhyan Ghosal and others Vs.

Smt. Deorajin Debi and another, AIR 1960 SC 941) and Prahlad Singh Vs.

Col. Sukhdev Singh [(1987) 1 SCC 727].

In Y.B. Patil (supra) it was held:

"4\005 It is well settled that principles of res judicata

can be invoked not only in separate subsequent

proceedings, they also get attracted in subsequent

stage of the same proceedings. Once an order

made in the course of a proceeding becomes final,

it would be binding at the subsequent state of that

proceeding..."

In Vijayabai (supra), it was held:

"13. We find in the present case the Tahsildar

reopened the very question which finally stood

concluded, viz., whether Respondent 1 was or was

not the tenant of the suit land. He further

erroneously entered into a new premise of

reopening the question of validity of the

compromise which could have been in issue if at

all in appeal or revision by holding that

compromise was arrived at under pressure and

allurement. How can this question be up for

determination when this became final under this

very same statute ?..."

Yet again in Hope Plantations Ltd. (supra), this Court laid down the

law in the following terms:

"17\005One important consideration of public policy

is that the decisions pronounced by courts of

competent jurisdiction should be final, unless they

are modified or reversed by appellate authorities;

and the other principle is that no one should be

made to face the same kind of litigation twice over,

because such a process would be contrary to

considerations of fair play and justice."

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It was further held:

"31. Law on res judicata and estoppel is well

understood in India and there are ample

authoritative pronouncements by various courts on

these subjects. As noted above, the plea of res

judicata, though technical, is based on public

policy in order to put an end to litigation. It is,

however, different if an issue which had been

decided in an earlier litigation again arises for

determination between the same parties in a suit

based on a fresh cause of action or where there is

continuous cause of action. The parties then may

not be bound by the determination made earlier if

in the meanwhile, law has changed or has been

interpreted differently by a higher forum. But that

situation does not exist here. Principles of

constructive res judicata apply with full force. It is

the subsequent stage of the same proceedings. If

we refer to Order XLVII of the Code (Explanation

to Rule. 1) review is not permissible on the ground

"that the decision on a question of law on

which the judgment of the Court is based

has been reversed or modified by the

subsequent decision of a superior court in

any other case, shall not be a ground for the

review of such judgment"."

The question which now arises for consideration is as to whether the

First Appeal was maintainable despite the fact that an application under

Order 9, Rule 13 of the Code was dismissed.

An appeal against an ex-parte decree in terms of Section 96(2) of the

Code could be filed on the following grounds:

(i) The materials on record brought on record in the ex-parte

proceedings in the suit by the plaintiff would not entail a decree in

his favour, and

(ii) The suit could not have been posted for ex-parte hearing.

In an application under Order 9, Rule 13 of the Code, however, apart

from questioning the correctness or otherwise of an order posting the case

for ex-parte hearing, it is open to the defendant to contend that he had

sufficient and cogent reasons for not being able to attend the hearing of the

suit on the relevant date.

When an ex-parte decree is passed, the defendant (apart from filing a

review petition and a suit for setting aside the ex-parte decree on the ground

of fraud) has two clear options, one, to file an appeal and another to file an

application for setting aside the order in terms of Order 9, Rule 13 of the

Code. He can take recourse to both the proceedings simultaneously but in

the event the appeal is dismissed as a result whereof the ex-parte decree

passed by the Trial Court merges with the order passed by the appellate

court, having regard to Explanation appended to Order 9, Rule 13 of the

Code a petition under Order 9, Rule 13 would not be maintainable.

However, the Explanation I appended to said provision does not suggest that

the converse is also true.

In an appeal filed in terms of Section 96 of the Code having regard to

Section 105 thereof, it is also permissible for an Appellant to raise a

contention as regard correctness or otherwise of an interlocutory order

passed in the suit subject to the conditions laid down therein.

It is true that although there may not be a statutory bar to avail two

remedies simultaneously and an appeal as also an application for setting

aside the ex-parte decree can be filed; one after the other; on the ground of

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public policy the right of appeal conferred upon a suitor under a provision of

statute cannot be taken away if the same is not in derogation or contrary to

any other statutory provisions.

There is a distinction between 'issue estoppel' and 'res judicata' [See

Thoday vs. Thoday \026 1964 (1) All. ER 341]

Res judicata debars a court from exercising its jurisdiction to

determine the lis if it has attained finality between the parties whereas the

doctrine issue estoppel is invoked against the party. If such an issue is

decided against him, he would be estopped from raising the same in the

latter proceeding. The doctrine of res-judicata creates a different kind of

estoppel viz Estopper By Accord.

In a case of this nature, however, the doctrine of 'issue estoppel' as

also 'cause of action estoppel' may arise. In Thoday (supra) Lord Diplock

held :

"\005"cause of action estoppel" is that which prevents a

party to an action from asserting or denying, as against

the other party, the existence of a particular cause of

action, the non-existence or existence of which has been

determined by a court of competent jurisdiction in

previous litigation between the same parties. If the cause

of action was determined to exist, i.e., judgment was

given on it, it is said to be merged in the judgment\005.If it

was determined not to exist, the unsuccessful plaintiff

can no longer assert that it does; he is estopped per rem

judicatam."

The said dicta was followed in Barber vs. Staffordshire Country

Council, (1996) 2 All ER 748. A cause of action estoppel arises where in

two different proceedings identical issues are raised, in which event, the

latter proceedings between the same parties shall be dealt with similarly as

was done in the previous proceedings. In such an event the bar is absolute in

relation to all points decided save and except allegation of fraud and

collusion. [See C. (a minor) Vs. Hackney London Borough Council,

(1996) 1 All ER 973].

It is true that the Madras High Court in Badvel Chinna Asethu (supra)

held that two alternative remedies in succession are not permissible stating:

"Assuming that it is open to a defendant in the

appeal against the exparte decree to object to the

decree on the ground that he had not sufficient

opportunity to adduce evidence in a case where he

did not choose to avail himself of the special

procedure, it does not by any means follow that,

where he did actually avail himself of the special

procedure and failed, still it would be open to him

to have the same question reagitated by appealing

against the decree."

Oldfield, J. in his concurring judgment stated:

"\005No case has been cited before us in which the

question now under consideration, whether a party

against whom a decree has been passed ex parte

can proceed in succession under O.9, R.13, as well

as by taking objection to the order placing him ex

parte in his appeal against the substantive decree

has been dealt with. On principle it would appear

that he could only do so at the expense of the rules

as to res judicata; and there can be no reason why

the adjudication on his application under O.9,

R.13, if there were one should not be conclusive

against him for the purpose of any subsequent

appeal. In the present case it is suggested that the

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facts that his application under O.9, R.13, was not

carried further than the District Munsif's Court and

that he acquiesced in the District Munsif's

unfavourable order, would make a difference to his

right to appeal against the decree on this ground.

The answer to this is that the District Munsif's

order not having been appealed against, has

become final. It seems to me that it would be a

matter for great regret if a party could pursue both

of two alternative remedies in succession and that

the recognition of a right to do so would be a

unique incident in our procedure. I am

accordingly relieved to find that such a right has

not been recognized by authority\005"

The aforementioned view was reiterated in the subsequent decisions

of different High Courts in Marian Begum (supra) M/s. Mangilal Rungta,

Calcutta (supra) and Dr. M.K. Gourikutty (supra).

However, it appears that in none of the aforementioned cases, the

question as regard the right of the defendant to assail the judgment and

decree on merit of the suit did not fall for consideration. A right to question

the correctness of the decree in a First Appeal is a statutory right. Such a

right shall not be curtailed nor any embargo thereupon shall be fixed unless

the statute expressly or by necessary implication say so. [See Deepal

Girishbhai Soni Vs. United India Insurance Co. Ltd. (2004) 5 SCC 385 and

Chandravathi P.K. and Others Vs. C.K. Saji and Others, (2004) 3 SCC 734]

We have, however, no doubt in our mind that when an application

under Order 9, Rule 13 of the Code is dismissed, the defendant can only

avail a remedy available thereagainst, viz, to prefer an appeal in terms of

Order 43, Rule 1 of the Code. Once such an appeal is dismissed, the

Appellant cannot raise the same contention in the First Appeal. If it be held

that such a contention can be raised both in the First Appeal as also in the

proceedings arising from an application under Order 9, Rule 13, it may lead

to conflict of decisions which is not contemplated in law.

The dichotomy, in our opinion, can be resolved by holding that

whereas the defendant would not be permitted to raise a contention as

regards the correctness or otherwise of the order posting the suit for ex-parte

hearing by the Trial Court and/ or existence of a sufficient case for non-

appearance of the defendant before it, it would be open to him to argue in

the First Appeal filed by him against Section 96(2) of the Code on the merit

of the suit so as to enable him to contend that the materials brought on

record by the plaintiffs were not sufficient for passing a decree in his favour

or the suit was otherwise not maintainable. Lack of jurisdiction of the court

can also be a possible plea in such an appeal. We, however, agree with Mr.

Choudhari that the 'Explanation' appended to Order 9 Rule 13 of the Code

shall receive a strict construction as was held by this court in Rani

Choudhury (supra), P. Kiran Kumar (supra) and Shyam Sundar Sarma Vs.

Pannalal Jaiswal and Others [2004 (9) SCALE 270].

We, therefore, are of the opinion that although the judgment of the

High Court cannot be sustained on the premise on which the same is based,

the Respondents herein are entitled to raise their contentions as regards merit

of the plaintiff's case in the said appeal confining their contentions to the

materials which are on records of the case.

We, however, do not agree with Mr. Ranjit Kumar that the Appellant

herein has no locus standi to maintain this appeal. In terms of Order 22,

Rule 10 of the Code he could have been substituted in place of the plaintiff.

Even if he was not substituted in terms of the aforementioned provision, an

application under Order 1, Rule 10 of the Code on his behalf was

maintainable as he became the legal representative of the original plaintiff.

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For the view we have taken, it is not necessary for us to examine the

claim of the original plaintiff for partition of suit properties or claim of the

Respondent No. 2 herein as regard creation of a mortgage in relation thereto

by the original defendant No. 1 and/ or efficacy thereof. We refrain

ourselves from even considering the submission of Mr. Choudhari to the

effect that even otherwise the Respondent No. 2 herein could not have raised

a counter claim in the partition suit vis-`-vis the plaintiff and the effect, if

any, as regards his non-filing of an appeal relating to his counter claim. We

may notice that Mr. Choudhari has further contended that in terms of Order

17, Rule 2 of the Code in the event, in the suit which was adjourned and if

on the date of adjourned date the defendant did not appear, the court has no

other option but to proceed ex-parte. The High Court, in our opinion, should

be allowed to examine all aspects of the matter.

For the reasons aforementioned, we are of the opinion that although

the judgment of the High Court is not sustainable as the reasons in support

thereof cannot be accepted, the High Court for the reasons assigned

hereinbefore must examine the Respondents' claim on merit of the matter.

The Appeal is, therefore, allowed, the impugned judgment is set aside

and the case remitted to the High Court for consideration of the case of the

parties on merit of the matter. As the suit is pending since 1976, we would

request the High Court to dispose of the appeal at an early date and

preferably within a period of three months from the date of communication

of this order. No costs.