Court name: Supreme Court of India
Case name: State of U.P. & Anr. (Appellants) v. Jagdish Saran Agrawal & Ors. (Respondents)
Coram: Hon’ble Dr. Arijit Pasayat J. and Hon’ble Mukundakam Sharma J.
The disputed land in question is a ‘Nazul property’ or a type of land owned by the Government for non-agricultural purposes. The land was owned by the State but managed by the Municipal Board. The Municipal Board filed a suit in the Trial Court for a permanent injunction against Maharaja Sri Devendra who was the current occupant, from auctioning the said land. The authority of the respondents to occupy the premises was contested.
In the renewed case of the State of U.P. & Ors. v. Jagdish Saran Agrawal & Ors. (1988), the respondent appealed to the District Judge in 1992, upon failing to secure a decree on their behalf. The District Judge of Lalitpur allowed the appeal in the year 1994.
Subsequently, the State of Uttar Pradesh and Municipal Board of Lalitpur filed writ petitions challenging the decree of the District Judge before the High Court of Allahabad. The Learned Single Judge of the Allahabad HC dismissed the writ petitions on grounds of Res Judicata (English Common Law concept). Subsequently, the State and the Municipal Board appealed to the Supreme Court for the dismissal of the High Court’s judgment and to allow their writ petitions.
- Whether the dismissal of suit on grounds of non-prosecution (or any preliminary condition) can operate as Res Judicata or not?
- Whether Order IX Rule 9 is applicable to this present suit?
- Code of Civil Procedure: Section 11: “Res Judicata”, Order IX Rule 8: “Procedure when defendant only appears”, Order IX Rule 9: “Decree against plaintiff by default bars fresh suit.”
Judicial approach in previous judgments
The question before the Court was whether a High Court decision dismissing an appeal based on limitation or because the party had not taken measures to prosecute the appeal, operates as Res Judicata. Summarily, two of the four appeals of the respondent, on the question of title of property were rejected on grounds of limitation and non-prosecution and the Court held that the two dismissed appeals operated as Res Judicata, as against the other two appeals.
It was held that when a lower court dismisses a suit on procedural or technical grounds, then the principle of Res Judicata will not apply in the subsequent suit, as the original suit was not dealt upon merits. However, if the same case is decided on merits by the lower court and subsequently dismissed by the appellate court on preliminary grounds, then the principle shall apply. The rationale involved is that such a dismissal by the appellate court, invariably confirms the decision of the lower court which was decided on merits.
The author however slightly disagrees with this stance. The author believes that just because the appeal was dismissed on preliminary or procedural grounds, it does not mean that the substantial question of law was deliberated upon. Subsequently, it cannot be assumed that the lower court’s question of merit holds good in the eyes of law.
The Court held that for a previous decision to operate as Res Judicata, it should have been on a matter which was “heard and finally decided.” The author believes that the quoted phrase is only applicable when an appeal case is heard on the grounds of its merits and not dismissed due to preliminary lacunae.
- Ram Dawan v. Bhaktabala (1971)
This Court had to decide whether a previous ruling on title in land acquisition proceedings served as Res Judicata in a subsequent suit between the same parties when the claim of title was raised again.
Summarily, it has been established that a dispute with regards to title to receive the compensation amount, it automatically renders the question of title Res Judicata if no appeal is raised on the same decree. Parties should not refrain from appealing just because the subject matter was trivial. The Court also held that merely by the absence of a party before the Supreme Court is of zero consequence, as the decisions of the lower courts have been afforded after full contest on grounds of merit of the issue.
The Supreme Court disagreed with the decision of the High Court who had dismissed the writ petition of the appellant’s opining that the State was not authorized to challenge the validity of the orders passed by the Prescribed Authority (under the Act), as the order subsequently passed by the District Judge had become the ruling, thereby operating the writ petition before the High Court as Res Judicata.
Herein, the Supreme Court said that the High Court’s position is unsustainable as the District Judge did not record any findings on the merits of the case. Instead, it was argued on the nullity of the proceedings initiated.
For the purpose of recurring cause of action (herein, the occupation of the public premises by the Maharaja), the Supreme Court overturned the decree of the High Court and held that the shroud of Res Judicata over a fresh proceeding is removed when there has been a new finding or discovery in the order filed by the appellant, with respect to the merits of the case.
Analysis of the judgment
The dispute dates to 1960 when the Nagar Palika, Lalitpur filed a suit of injunction against the Maharaja. The Trial Court dismissed the suit and the same was absent from Court records. Subsequently, the State of UP initiated fresh proceedings in 1970 with respect to the same dispute. While this suit was on trial, the Eviction Act under which the title to the property was contested, was held ultra vires by the Court.
Consequently, the State amended its case after taking the required steps necessitated by the Act. This case was dismissed by the Prescribed Authority for default in 1976. Subsequently, the application to recall the order was filed in 1977, which too was dismissed.
It must be noted that the suit of 1960 was dismissed on technical grounds by the Court and the State of Uttar Pradesh was not a party to that suit. As per the rules of the Nagar Palika, the State of Uttar Pradesh who is not privy to the suit cannot be made binding on it, even if the land in question is owned by the State. The (amended) suit of 1976 and its appeal in 1977, both were dismissed on grounds of non-prosecution by the petitioner / appellants’ side.
After a decade of dormancy, the State commenced fresh proceedings in 1988. This was contested by the respondents (the occupants of the Nazul premises) that the suit was barred by Res Judicata (as previously, proceedings involving the same parties and same dispute were instituted by the Nagar Palika in 1960 and the State of Uttar Pradesh in 1976 respectively) and Order IX Rule 9 of the CPC. The Prescribed Authority in its January 1992 judgment held that both the 1960 and 1976 judgments do not operate as Res Judicata.
The author agrees with the view on the 1960 judgment not operating under Res Judicata as the State of Uttar Pradesh was not a party to that suit as opposed to this one. However, the author agrees with the view but disagrees with the reasoning on the 1976 judgement and believes that it should not operate as Res Judicata since it was dismissed on grounds of non-prosecution and not merits.
(In Charan Singh & Ors. v. Babulal & Ors., the District Judge was correct in holding that the award was vitiated by a clear error of law because it was based on the premise that the High Court’s decision would not serve as Res Judicata on the issue of title to the properties.
Similarly, The UK Supreme Court in Virgin Atlantic Airways v. Zodiac Seats UK Ltd. have held that Res Judicata prohibits the raising of issues that were not raised in the earlier proceedings and if it can be concluded with due diligence that such issues should have been necessarily raised previously.)
Subsequently, the respondents appealed initially to the High Court which was dismissed due to the availability of alternative remedies. Thereafter, an appeal was filed before the Prescribed Authority in February 1992.
The Prescribed Authority upheld the view regarding the 1960 judgment, however decreed that the 1976 judgment operated as Res Judicata. It was observed that even though the Eviction Act was declared ultra vires during the period of proceedings, the State reshaped its case as per the required and proceeded with it. This suit was dismissed, along with the subsequent application to recall of the order, both were dismissed on grounds of non-prosecution.
Therefore, the order to the amended suit in 1976 was considered as final decision and authority with no further appeals to it. Subsequently, any other suit involving the same parties and the same dispute would operate as Res Judicata. On this basis, the High Court rejected the writ petitions filed by the State and instructed the State to proceed under Order IX Rule 9. The precursor of Rule 9 is that the suit in question must be dismissed under Order IX Rule 8.
The author disagrees with this view as the 1976 suit was dismissed for non-prosecution (i.e., a preliminary condition) and not based on the merits of the case. The primary question whether the respondents were authorized or illegal occupants, was not answered by the Court. The suit was not ‘heard and finally dismissed’ by the Court. The author would have agreed with this view if and only if that suit were to be decided on its merits, as the parties and the dispute are the same as the fresh proceedings initiated in 1988.
Similarly, in the Sennar case, it was held that the application of Res Judicata requires the judgment to be rendered ‘on merits’, which is satisfied when the dispute is resolved on the finding of legal rights, rather than its procedure.
In Mohanlal Goenka v. Benoy Mukherjee, it was determined that there is sufficient evidence to support the conclusion that even an incorrect legal decision acts as “res judicata” between the parties involved. Whether a judicial decision is correct or incorrect has no bearing on whether it is res judicata.
The Supreme Court herein opined that –
- Concerning the 1960 judgement, the State was not a party and therefore, does not operate under Res Judicata.
- With respect to the 1976 judgment, the suit was dismissed for non-prosecution, but not under Order IX Rule 8. Subsequently, Rule 9 is not applicable to the present scenario.
- Also, the merits of the case was not deliberated upon and therefore, does not operate under Res Judicata.
In Arnold v. National Westminister Bank PLC, it was decided that res judicata can apply when a particular issue that is a necessary ingredient in a cause of action has been litigated and decided, and one of the parties seeks to reopen that issue in a subsequent proceeding between the same parties involving a different cause of action in which the same issue is relevant.
Consequently, the order of the High Court is set aside, and the matter is delegated to the District Judge, Lalitpur to proceed with the case on merits. The author concurs with the judgment.
Suggestions / a different perspective
The author (in his limited understanding) shall put forth criticism of the Supreme Court’s stance and appreciate the High Court’s view, with regards to Order IX Rule 9.
The High Court, while examining the writ petition of the State, had held that the order of the 1976 judgment was to be treated as final. Subsequently, the Court advised the State to proceed under Order IX Rule 9 to reinstate the proceedings. Therefore, it can be assumed that the Court accepted that the dismissal of that suit was made under Order IX Rule 8, as dismissal under Rule 8 is a prerequisite to initiate fresh proceedings under Rule 9. (The author is not privy to the order of the 1976 judgment and therefore, this is an assumption.)
Contrarily, when the Supreme Court held that the 1976 suit was dismissed on grounds of non-prosecution, but not under rule 8, the author believes that the Court in its collective wisdom went hyper-technical with the interpretation of Rule 8. Rule 8 says that suit may be dismissed if the plaintiff fails to appear upon being called for hearing. The author asks the question – what good is presence before the Court than absence, if the plaintiff ultimately takes no steps to proceed with the case?
While the High Court’s stance ensures that the State can reopen or reinstate proceedings under Rule 9 only if it has “sufficient cause for non-appearance before the Court”, the Supreme Court’s stance implies that the State can begin proceedings with the recurring cause of action at any point of time, thereby wasting precious judicial time and that of the respondents. The recurring cause of action is against the principle of Res Judicata.
As held in Jallur Seshayya v. Thadviconda Rao, a similar suit, relating to the current suit, was dismissed by the Court two years ago, and the appellant argued that the plaintiffs (in the previous suit) were negligent, and thus the doctrine of res judicata be applied. The privy council, on the other hand, stated that the documents were suppressed, implying that the plaintiff in the previous suit had good faith intentions. This can be categorized as a sufficient cause for non-appearance.
Finally, as rightly held in Satyadhan Ghoshal v. Deorajan Deb, the principle of Res Judicata is founded on the requirement of giving a conclusion to judicial decisions.
To conclude, the ratio decidendi of this case is as long as the other side is not heard and finally dismissed on the question of merits of the case, the principle of Res Judicata does not apply. Therefore, a suit that is dismissed on preliminary conditions does not attract this principle and fresh proceedings can be initiated.
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