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Vishnu Sugar Mills Ltd. Vs. I.S.P. Trading Co. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata High Court
Decided On
Case NumberC.O. No. 2907 of 1983
Judge
Reported inAIR1984Cal246,(1985)2CompLJ28(Cal),88CWN945
ActsCode of Civil Procedure (CPC) , 1908 - Section 11
AppellantVishnu Sugar Mills Ltd.
Respondenti.S.P. Trading Co.
Appellant AdvocateSrenik Singhvi, Adv.
Respondent AdvocateMonoranjan Das, Adv.
DispositionRevision allowed
Cases Referred(Isup All v. Gour Chandra
Excerpt:
- .....the defendant. that preliminary issue is to the effect as to whether the claim put forward in the present suit being commercial suit no. 336 of 1972 is barred by principles of res judicata in view of the decree passed in money suit no. 126 of 1972 by another court between the parties.2. certain facts are not in dispute. the plaintiff i. s. p. trading company entered into an agreement on october 21, 1971, with the defendant to supply 300 pieces of e. r, w. steel boiler tubes. the terms and conditions of the agreement were set out in the defendant's letter dated october 21. 1971. the plaintiff instituted commercial suit no. 336 of 1972 on the allegation that the plaintiff duly supplied the said 300 pieces of e. r. w. steel boiler tubes according to specification and in accordance with the.....
Judgment:

Anil Kumar Sen, J.

1. This is a revisional application at the instance of the defendant in Commercial Suit No. 336 of 1972 of the 10th Bench, City Civil Court, Calcutta. The order impugned is one dated August 10, 1983. By the order impugned the learned Judge has decided a preliminary issue against the defendant. That preliminary issue is to the effect as to whether the claim put forward in the present suit being Commercial Suit No. 336 of 1972 is barred by principles of res judicata in view of the decree passed in Money Suit No. 126 of 1972 by another court between the parties.

2. Certain facts are not in dispute. The plaintiff I. S. P. Trading Company entered into an agreement on October 21, 1971, with the defendant to supply 300 pieces of E. R, W. Steel boiler tubes. The terms and conditions of the agreement were set out in the defendant's letter dated October 21. 1971. The plaintiff instituted Commercial Suit No. 336 of 1972 on the allegation that the plaintiff duly supplied the said 300 pieces of E. R. W. Steel boiler tubes according to specification and in accordance with the terms and conditions of the agreement, the plaintiff received only a sum of Rs. 6000/- by way of advance. But the defendant failed and neglected to pay the balance value of the goods so supplied in spite of the fact that the bills were duly submitted therefor. Adjusting the said advance of Rs. 6000/- against the total value of the goods assessed at Rs. I3,287/- the plaintiff sought for a decree for Rs. 7,287/-together with interest amounting to Rupees 655/75. This suit was filed in the City Civil Court, Calcutta.

3. The defendant, on the other hand, filed Money Suit No, 126 of 1972 in the Court of the learned Subordinate Judge, Gopalganj against the present plaintiff for a decree for a sum of Rs. 7135/-. The said claim was laid on the ground that the defendant advanced a sum of Rs. 6000/- on the self same contract dated October 21, 1971, but in breach of that contract the present plaintiff supplied goods which were not m accordance with the specification nor in terms of the agreement between the parties. The defendant called upon the plaintiff to inspect the tubes rejected by them and to get them satisfied that the tubes supplied were not in accordance with the specification, but the said request was overruled wrongfully. Accordingly the defendant claimed that by rescinding the contract the defendant was entitled to get refund of the advance of Rs. 6000/- together with interest and cost of the transportation. The total figure was arrived at by adding Rs. 6000/- as the advance to be refunded with Rs. 572/- by way of interest and Rs. 563/- towards the cost.

4. On the respective pleadings it is quite obvious to us that the two suits are not only between the same parties but also involve substantially one common issue as to whether the plaintiff had supplied tubes in accordance with the agreement or not and whether the defendant was within his rights to rescind the contract the goods not being supplied in accordance with the agreement. The two suits, in our opinion, should not have been allowed to proceed simultaneously in the two courts, but unfortunately no steps were taken by either of the parties to stay either of the suits. Now in the suit filed by the defendant at Gopalganj the present plaintiff did appear and filed written statement. After having contested the suit for some time the plaintiff withdrew himself and that suit ended in a decree in favour of the present defendant on July 14, 1982. According to the defendant, that decree is now under execution.

5. At this stage when Commercial Suit No. 336 of 1972 came up for hearing before the learned Judge at the City Civil Court, Calcutta the defendant very legitimately raised an objection to the effect that the present suit can no longer proceed being barred by principles of res judicata in view of the ex parte decree passed in Gopalganj suit. This issue has been disposed of by the learned Judge against the defendant and in doing so he has given the following reason :--

'The question whether the contract between the parties should be deemed to have been terminated on passing of a decree for refund of Rs. 6000/- will be considered at the time of argument after defendant concludes examination of witness. It is not enough that the parties are the same and the same matter is directly and substantially at issue in both the suits. Another important condition is that the matter must have been heard and finally decided in the former suit. In this case we find that hearing of the former suit, i.e. Commercial Suit No. 336 of 1972 has not been concluded. The ex parte decree in the subsequent suit, i.e. in Money Suit No. 126 of 1972 of Gopalganj Court where no issues were framed or decided cannot operate as res judicata. The present suit is maintainable even though ex parte decree for refund of Rupees 6000/- has been passed in favour of the defendant. I am of opinion that the present suit is not barred by the principles of res judicata.'

This is the decision which is the subject matter of challenge before us in the present revisional application. Having heard the learned counsel for the parties we have no hesitation to say that the learned Judge did not really appreciate the principles underlying Section 11 of the Civil Procedure Code. If he thought that the suit now pending before him was a former suit only because it was filed earlier than Money Suit No. 126 of 1972 within the meaning of Section 11 he was very much in error. The basic principle underlying Section 11 is that once the parties have undergone adjudication of an issue in a suit, that would be final as between the parties irrespective of whether that suit was filed earlier at point of time or later and no court can try that issue any further in another suit even if that suit had been instituted at an earlier point of time. It is the finality of the decision which creates the bar and such finality is not dependent upon the fact as to whether the suit in which the issue had been decided had been filed before or after the suit in which the same issue has arisen. (Isup All v. Gour Chandra, (1923) 37 Cal LJ 184) : (AIR 1923 Cal 496). Similarly the learned Judge was equally in the error if he thought that the decree in Money Suit No. 126 of 1972 would not constitute res judicata only because it was an ex parte decree where no issues were framed. It is settled principle now that even ex parte decrees do constitute res judicata if the issue involved is one which constitutes the basis or foundation of the decree. It is very unfortunate that the learned Judge totally overlooked the explanation IV to Section 11 of the Code. We are also unable to appreciate the observation of the learned Judge that the question as to whether contract between the parties should be deemed to have been terminated on passing of the decree for refund will be considered at the time of the argument. The present defendant in his suit, Money Suit No. 126 of 1972 claimed refund of the sum of Rupees 6000/- specifically on the plea that the goods supplied not being in terms of the agreement he was entitled to rescind me contract and get refund. Once he obtained such a decree it is necessarily decided between the parties that the defendant was within his rights to rescind the contract lawfully. This issue or this position being conclusive and binding-between the parties, the plaintiff can no longer claim in his suit that he is entitled to get the price of the goods supplied by him on the basis that the goods supplied being in terms of the agreement the defendant is liable to pay the price thereof due after adjustment of advance already made.

6. Mr. Das appearing in support of the order passed by the learned Judge strongly contended that since the issue as to whether the defendant was within his rights to re-scind the contract or not and whether the goods supplied were in accordance with the agreement or not had not been expressly gone into and decided in the Gopalganj suit, there is no decision which can bar the adjudication of such an issue. According to Mr. Das, that which has not yet been decided cannot constitute res judicata. He relies upon certain decisions, which, in our view, are off the point; in all those cases what was decided was that an issue which had not directly and substantially been involved and does, not constitute the basis of the decree, is not concluded by that decree. Those decisions, therefore, stand on a different point and are of no help to us because on the pleadings of the parties in the two suits and upon the finding of the learned Judge the issue raised in the suit before him is an issue which was directly and substantially in issue in the Gopalganj suit and the Gopalganj suit could not have been decreed without deciding that issue in favour of the defendant. In the Gopatganj suit, the present defendant actually raised an issue that the plaintiff having failed to deliver the goods in accordance with the contract, he was entitled to rescind the contract and recover the advance made by him. When that suit was decreed, that issue was decided in his favour. Only because the decree is ex parte it cannot be said that the said issue had not been decided. Moreover even in the alternative what constituted the basis of the plaintiff's suit at City Civil Court would have been a complete defence to the Gopalganj suit, so that even if that had not actually been raised that would fall within the bar of constructive res judicata,

7. If we look at the point from a different angle, in our opinion, we would come to the same conclusion. After all, the principle of res judicata is meant to avoid conflict in decisions. We have repeatedly asked Mr. Das as to whether if we allow the present suit to proceed and if it ends in a decree in favour of the plaintiff, such a decree would not be inconsistent with the decree which the defendant had already obtained against the plaintiff. Mr. Das has failed to answer this question though, in our opinion, there could be no doubt about the fact that the answer would be in the affirmative. Since the answer would be in the affirmative this suit should no longer be allowed, to proceed with a possible risk of ending in an inconsistent decree.

8. In the result, we set aside the order impugned before us and hold that the ex parte decree passed in Money Suit No. 126 of 1972 bars the present suit on principles of res judicata.

9. The revisional application, therefore, succeeds and the impugned order being set aside we dismiss the plaintiff's suit on the ground that the plaintiff's claim is barred by principles of res judicata.

10. There will no order as to costs.

Prabir Kumar Majumdar, J.

I agree.


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