Gulabchand Chhotalal Parikh v State of Bombay (1964)

The earlier decision in Daryao had held that a writ decision on the merits bars a second writ petition. This case answers the converse and harder question: does it bar a regular civil suit? Section 11 in terms requires a former suit, and requires that the court which decided it should have been competent to try the later suit — a High Court exercising writ jurisdiction does not fit that description comfortably. The majority answers that s. 11 is not exhaustive, and that the general principle of res judicata operates independently of the section. The dissent of Subba Rao J is the classic statement of the contrary view, and is worth knowing for the same reason.

The appellant stood surety for a number of contractors who in 1947 took contracts for felling and removing timber in the forests of the erstwhile State of Baria, the contracts being auctioned under the conditions of auction sale of forests of that State. On 7 April 1948 he applied to the State praying that brokers who owed money to the contractors be restrained from paying it over, and that brokers and contractors be restrained from directly removing the contractors' jungle goods from the godowns without the Government's permission. Notices of attachment were issued to the contractors. The State of Baria merged with the State of Bombay on 10 June 1948, and thereafter the contractors were allowed by Government to remove the materials on certain conditions.

The writ petition. When the contractors defaulted, the forest authorities moved the revenue authorities to recover the balance from the appellant as surety as an arrear of land revenue, and steps were taken to attach his immovable properties. He petitioned the Bombay High Court under Art. 226 for a direction to raise the attachment and for a writ of mandamus or prohibition against the sale, contending that by permitting the contractors to sell their attached properties without his knowledge and consent the State had put an end to his security, so that he stood discharged as surety. The High Court dismissed the petition on 22 July 1952, holding there was no substance in the contention: it was a wrong assumption that the attached goods were not to be sold without his knowledge and consent, his own application of 7 April 1948 having contained no such prayer.

The suit. On 29 August 1952 the appellant sued for a declaration that he was discharged from all liability as surety, and for permanent injunctions restraining the State from attaching and selling his property otherwise than in execution of a decree. The pleaded ground of discharge was the same, though it was now put as resting on "Forest Auction Rules" rather than on the conditions of auction sale. Issue No. 8A asked whether the suit was barred by res judicata in view of the High Court's judgment on the writ applications. The trial court held that it was and dismissed the suit; the District Judge agreed and dismissed the appeal. In second appeal a Single Judge of the High Court agreed that the question whether the plaintiff was absolved from liability was res judicata, but held that the suit could be maintained to determine the amount due, that not having been decided in the writ petition, and decreed to that limited extent. Leave to appeal under the Letters Patent was refused, and the appellant came by special leave.

Does a decision of the High Court on the merits, after contest, on a matter raised in a writ petition under Art. 226 operate as res judicata in a subsequent regular suit between the same parties on the same matter?

The change of label. The appellant urged that in the writ petition the plea of discharge rested on the terms of the contract based on the conditions of auction sale, while in the suit it rested on the auction rules. The Court held the distinction had no substance: no rules were ever produced, counsel when asked for them produced a booklet of conditions, and the High Court's own order had referred to those conditions as rules, probably in view of their binding nature. On the footing that the proceedings raised the same matter, the Court observed that if the earlier decision had been given in a regular suit it would plainly have operated as res judicata in the later suit; the only question was whether its having been given in a writ petition made a difference.

Order 2, rule 2. It was argued that if a writ decision could bar a suit, then O. 2, r. 2 would equally bar a suit for a part of the cause of action for which no relief had been sought in the writ petition. The Court rejected this. By its very language O. 2, r. 2 applies only to suits: it requires every suit to include the whole of the claim, and bars a later suit for a portion omitted or relinquished. Those provisions do not apply to the contents of a writ petition, and consequently not to the contents of a subsequent suit.

Discretion. The argument that a writ decision should not bind because the writ jurisdiction is discretionary had already been negatived in Daryao, and the majority set out the passage from that case drawing the distinction between a refusal grounded on laches or an efficacious alternative remedy — which cannot generally be pleaded in support of the bar — and a dismissal on the merits, which can.

The objection that the civil court and the writ court are not courts of co-extensive jurisdiction was not treated as decisive. Writ courts do not usually enter into disputed questions of fact, but there is no bar to their doing so if they feel disposed to enter into such facts and arrive at a conclusion; and there is no reason why all the grounds which can be urged for or against a matter raised for decision in a writ petition cannot be urged in the proceedings on it. The civil court, moreover, is in exercise of its jurisdiction subject to the appellate or revisional jurisdiction of the High Court and the Supreme Court. The contrary reasoning of a Punjab decision was considered unsound and that case held to have been wrongly decided; a Bombay decision the other way was approved.

The appeal was dismissed with costs. The majority held:

1. The provisions of s. 11 are not exhaustive with respect to an earlier decision operating as res judicata between the same parties on the same matter in controversy in a subsequent regular suit. 2. On the general principle of res judicata, any previous decision on a matter in controversy, decided after full contest or after affording fair opportunity to the parties to prove their case, by a court competent to decide it, will operate as res judicata in a subsequent regular suit. 3. It is not necessary that the court deciding the matter formerly be competent to decide the subsequent suit, or that the former proceeding and the subsequent suit have the same subject matter. The nature of the former proceeding is immaterial. 4. Accordingly, the decision of a High Court on a writ petition under Art. 226, on the merits on a matter after contest, operates as res judicata in a subsequent regular suit between the same parties with respect to the same matter.

The majority expressly made it clear that it was not necessary, and it had not considered, whether the principles of constructive res judicata can be invoked by a party to the subsequent suit on the ground that a matter which might or ought to have been raised in the earlier proceeding was not so raised.

Subba Rao J would have held that the writ decision did not preclude the court from deciding the same question on the merits in the suit, and would have remanded the appeal to the High Court. He distinguished the earlier writ authorities on the footing that in each the question of res judicata arose in an application under Art. 226 or Art. 32 and not in a suit, and relied on an earlier ruling of the Court that where s. 11 is inapplicable it is not permissible to rely on the general doctrine of res judicata, and that in a suit the only ground on which res judicata can be urged is the section and no other. On his view no practical difficulty followed, because a High Court's decision on a question of law binds subordinate courts as authority, and its decision on a question of fact will rarely be differed from by them.

The majority stopped short of constructive res judicata and said so in terms. This case decides only that a matter actually decided in the writ proceeding binds in the later suit; it leaves untouched the question of a plea that might and ought to have been raised. Treating the reservation as a doubt cast on constructive res judicata generally is the standard error, and the reservation should always be quoted alongside the four propositions.