The pendency of a suit in a foreign Court does not preclude the courts in India from trying a suit founded on the same cause of action.
Section 10 requires that a suit must be stayed if the matter directly and substantially in issue in it is also directly and substantially in issue in a previous suit that is pending. The criterion for deciding whether the subsequent suit be stayed or not is whether there is identity of the matters directly and substantially in issue in the two suits; if there is, the subsequent suit must be stayed and if there is not, it will not be stayed.
The object of this section is to prevent two courts of concurrent jurisdiction from simultaneously trying two parallel suits in respect of the same matter in issue. It is to obviate conflict of decisions of two
contradictory decrees being passed in respect of the same subject-matter between the same parties that the present section has been enacted.
Conditions for the applicability of section 10:
In order to attract the application of this section it is necessary that the following conditions must be fulfilled:
(1) A previously instituted suit is pending in a court;
(2) The matter in issue in the second suit is also directly and substantially in issue in a previously instituted suit;
(3) The previously instituted suit must be pending in the same court in which the subsequent suit is brought, or in any other court in India or in any court beyond the limits of India established or continued by the Central Government or in the Supreme Court;
(4) The court in which the previous suit is pending has jurisdiction to grant the relief claimed in the subsequent suit;
(5) The parties in the two suits are the same; and
(6) The parties must be litigating under the same title in both the suits.
To sum up, the conditions for the application of section 10 are:
(1) The matter in issue in the second suit must also be directly and substantially in issue in the prior suit; (2) the prior suit must be pending in the same court or in any court in India having jurisdiction to grant the relief claimed; and (3) where the previously instituted suit is pending in any court in India, etc. such court is of competent jurisdiction to grant the relief claimed in the subsequent suit.
It may, however, also be noted that the term “suit” in this section includes appeal.
The words of section 10 are mandatory and the test to determine whether the matter in issue in the second suit is also directly and substantially in issue in the previously instituted suit and whether if the first suit is determined the matters raised in the second suit will be res Judicata by reason of the decision in the prior suit. It is not necessary that the subject-matter and cause of action should be the same. But what is essential is that there must be substantial identity between the matters in dispute and parties in the earlier and later suits.
Matters in issue:
All the issues in the second suit must be determined by the decision in the first suit before section 10 can come into operation. The words “matter in issue” in section 10, C.P.C., means the entire matter in controversy and not one of the several issues in the case.
Where the earlier suit was for recovery of rent for a certain period and the subsequent suit is for recovery of rent for subsequent years and for ejectment, the matter in issue in the two suits would not be deemed to be the same and section 10, C.P.C., would not be applicable.
The second suit, it must be noted, is not dismissed as barred, it is only the trial of the suit that is not proceeded with and is stayed. The section is no bar to the institution of a second suit. In many cases it is necessary for a party even to institute a second suit in order to save the period of limitation.
One of the most essential conditions of section 10 is that the matter in issue in the later suit which is sought to be stayed must be directly and substantially in issue in the earlier suit which is pending in the same or in any other court of concurrent jurisdiction.
A mere identity of some of the issues in both the suits is not sufficient to attract the section. Unless the decision of the suit operates as res Judicata in the other suit, it cannot be said that the matter is “directly and substantially” the same in both the suits. In other words, the decision in one suit must non-suit the other suit before it can be said that the matter in both the suits is directly and substantially the same.
Different causes of action:
When earlier suit was instituted for recovery of dues payable by appellant-consignors and later suit by appellants for recovery of goods lawfully entrusted to and unlawfully detained by respondent carriers, the later suit could not be stayed. The causes of action in both suits are entirely different.
Where the subject-matter in controversy between two suits remained the same, but reliefs were based on different causes of action, it was held by the Calcutta High Court in Challapalli Sugar Ltd. v. Swadeshi Sugar Supply Pvt. Ltd. that the later suit should be stayed. The matter for determination in the case of an application for stay under section 10 of the Code is not what the basis of the claim in the two suits is but what is the matter in issue in the two suits.
The word ‘trial’ is not used in its widest sense. The concept of trial is applicable only to a regular/ordinary suit. It is not applicable to subsequently filed summary suit under Order XXXVII. In summary suit ‘trial’ begins after the court grants leave to the defendant to contest the suit and it does not mean entire proceedings starting with institution of the suit by lodging a plaint.
Effect of contravention:
A decree passed in contravention of section 10 is not a nullity and cannot be disregarded in execution proceedings.
In a case not covered by section 80 an order for stay may be made under section 151, C.P.C., if the court considers that it is necessary in the interest of justice and in order to avoid unnecessary harassment to any of the parties.
The doctrine of res judicata is based upon two Roman maxims Nemo debet bis vexari pro uno eteadem cause, i.e., no one shall be vexed twice over for the same cause of action, and interest republicae ut sit finis litium, i.e., it is to the interest of the State that there should be an end to litigation.
The first maxim looks to the interest of the litigant, who should be protected from a vexatious multiplicity of suits, for otherwise a man possessed of wealth and capacity to fight may overawe his- adversary by constant dread to litigation. The second maxim is based on the ground of public policy that there should be an end to litigation.
Judicial decisions must be accepted as correct, for otherwise if suits were allowed to be filed endlessly for the same cause of action, it will be impossible for the existing courts to deal with ever growing number of suits. Unlimited or perpetual litigation disturbs the peace of the society and leads to disorder and confusion. It is a rule common to all civilised systems of jurisprudence, and was well understood by Hindu lawyers as well as other modern systems of law.
Rule of res Judicata while founded on ancient precedent is dictated by a wisdom which is for all time and the application of the rule by the Courts should be influenced by no technical considerations of form but by matter of substance within the limits allowed by law.
It is now settled that for judgment to operate as res Judicata between or among co-defendants it is necessary to establish that: (1) there was a conflict of interest between the co-defendants; (2) that it was necessary to decide the conflict in order to give relief which the plaintiff claimed; and (3) that the court actually decided the question. If thus a previous decision can operate as res Judicata between the co-defendants under certain condition there is no reason why a previous decision should not operate as res Judicata between the co-plaintiffs if the same conditions are mutatis mutandis satisfied.
Indian Origin of Res Judicata:
The principle of res Judicata (matter already decided) is founded on the ancient principle of prangnyaya (previous judgment). The doctrine which is Called by its Latin name of res Judicata and which prevents a party from re-agitating a dispute which has already been decided between the parties was evolved and developed by the jurists of ancient India under the title of prangnyaya (previous decision). The principle is thus enunciated in Brihaspati Samriti:
“If a person who has been defeated in a suit according to law (acharena avasanoopi) files his plaint once again he must be told that he has been defeated already; this is called plea of prang-nyaya”. But the pleas had to be raised expressly by the defendant. In Harita Dharma Shastra it is provided that the onus is on the defendant to plead and establish the bar of prangnyaya.
As late as 16th A.D. century Vachaspati Misra, the author of Vyovahara-Chintamani, the great Code on legal procedure, wrote that the burden of establishing the bar of prangnyaya was on the defendant because it was his duty to prove his former victory.—Vyovahara Chintamani, edited by Dr. Ludo Rocher, published by the University of Ghent, 1956, p. 64 (cited by Mr. Justice Dhavan of the Allahabad High Court).
Res judicata connotes a thing already adjudicated upon—res means thing and judicata means already decided.
State of Uttar Pradesh v. Nawab Husain:
The principle of estoppel per rem judicatum is a rule of evidence. As has been stated in Marginson v. Balcburn Borough Council, it may be said to be “the broader rule of evidence which prohibits the reassertion of a cause of action”.
The doctrine is based on two theories: (1) the finality and conclusiveness of judicial decisions for the final termination of disputes in the general interest of community as a matter of public policy and (ii) the interests of the individual that he should be protected from multiplication of litigation.
It, therefore, serves not only a public but also a private purpose by obstructing the reopening of matters which have once been adjudicated upon. It is thus not permissible to obtain a second judgment for the same civil relief on the same cause of action, for otherwise the spirit of contentiousness may give rise to conflicting judgments of equal authority, lead to multiplicity of actions and bring the administration of justice into disrepute.
It is the cause of action which gives rise to an action, and that is why it is necessary for the court to recognise that a cause of action which results in a judgment must lose its identity and vitality and merges in the judgment when pronounced. It cannot, therefore, survive the judgment, or give rise to another cause of action on the same facts. This is what is known as the general principle of res Judicata.
But it may be that the same set of facts may give rise to two or more causes of action. If in such a case a person is allowed to choose and sue upon one cause of action at one time and to reserve the other for subsequent litigation, that would aggravate the burden of litigation, Courts have, therefore, treated such a course of action as an abuse of its process and Somervell, L.J. has answered it as follows in Greenhalgh v. Mallard:
“I think….. it would be accurate to say that res Judicata for this purpose is not confined to the issues which the court is actually asked to decide, but that it covers issues or facts which are so clearly part of the subject-matter of the litigation and so clearly could have been raised that it would be an abuse of the process of the court to allow a new proceeding to be stated in respect of them.”
This is, therefore, another and an equally necessary and efficacious aspect of the same principle, for it helps in raising the bar of res Judicata by suitably construing the general principle of subduing a cantankerous litigant. That is why this other rule has sometimes been referred to as constructive res Judicata which in reality is an aspect or amplification of the general principle.
In Daryao v. State of U.P., the Supreme Court observed:
“Now, the rule of res Judicata as indicated in section 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 consideration of public policy. It is in the interest of the public at large that 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.”
It is thus clear that technical aspects of section 11, C.P.C., as for instance, pecuniary or subject-wise competence of the earlier forum to adjudicate the subject-matter or grant reliefs sought in the subsequent litigation, would be immaterial when the general doctrine of res Judicata is to be invoked.