Holding

An order permitting withdrawal of a suit without liberty to institute a fresh suit does not constitute a decree and cannot bar the party from raising the same defence in a subsequent suit.

Summary

The appellants (defendants in the earlier suit) challenged a Madras High Court order that, after allowing them to withdraw their 1973 suit without liberty to file a fresh suit, barred them from raising the defence that the conveyance deed was invalid. The Supreme Court examined whether such a withdrawal order constitutes a decree under Section 2(2) of the Code of Civil Procedure, 1908, and whether it triggers the doctrine of res judicata. Relying on earlier decisions, the Court held that an order permitting withdrawal without adjudication is not a decree and therefore does not preclude the parties from asserting the same defence in subsequent litigation. Consequently, the High Court’s view that the defence was barred was reversed. The appeal was allowed, permitting the appellants to raise the validity of the sale deed in the second round of litigation.

Issues considered

The effect of an order allowing withdrawal of a suit without liberty to file a fresh suit under Order 23 Rule 1(4) of the CPC.
Whether such an order constitutes a decree within the meaning of Section 2(2) of the CPC.
Whether the doctrine of res judicata bars the defence in a subsequent suit when the earlier suit was withdrawn without adjudication.

Legislation cited

Code of Civil Procedure, 1908s. 100, s. 2(2), s. 96

Subjects

withdrawal of suitfresh suitdecree definitionres judicataCPC Order 23 Rule 1(4)civil procedureproperty disputedefence preclusion

Judgment

A KANDAPAZHA NADAR AND ORS.
v. I" -
CHITRAGANIAMMAL AND ORS.

APRIL 16, 2007

B [DR. ARJJIT PASA YAT AND S.H. KAPADIA, JJ.]

Code of Civil Procedure, 1908-0. 2 r. 2, 0. 9, r.9.0. 22 r. IO and 0.
23 r. I (4)-Withdrawal of suit-Without liberty to file a fresh suit-Effect
of-On the defence of the party withdrawing, in a subsequent suit-Held:
c Such withdrawal, without any adjudication, does not constitute a decree,
hence cannot debar the defence in subsequent suit.

Plaintiff-predecessor of the respondents herein filed a suit against the
defendants-appellants, claiming to be owner of the property in question, which
D he had purchased from 'C'. According to the plaintiff the defendants had
entered the possession of the property on the strength of a fraudulent
conveyance deed. The earlier suit in respect of the property in question filed
by the defendants had been withdrawn by them at the stage of second appeal,
·t
without permission to file a fresh suit.
...
E Trial Court held the plaintiff entitled to the suit property. First Appellate
Court inter alia held that withdrawal of the earlier suit by the defendants
barred the plaintiff from filing a subsequent suit, but it did not affect the
defence of the defendants. High Court held that that by application of general
principles of res-judicata, defence of the defendants was barred in view of
•
withdrawal of their earlier suit.
F
In appeal to this Court, appellant-defendants contended that fresh suit ·-
was not barred and Order 23 Rule 1 ( 4) had no application to the facts of the
cases.

Allowing the appeal, the Court
G
'·
HELD: When the court allows the suit to be withdrawn without liberty
to file a fresh suit, without any adjudication, such order allowing withdrawal
~-
cannot constitute a decree and it cannot debar the petitioners herein from
taking the defence in the second round of litigation. If the plaintiff withdraws
"
H 174
KANDAPAZHA NADAR v. CHITRAGANIAMMAL[PASAYAT,J.l 175
- --1 the suit, the order of the court allowing such withdrawal does not constitute A
a decree under Section 2(2) of CPC. That in any event, will not preclude the
petitioners herein (defendants in second round) from raising the plea that
the sale deed executed in favour of the plaintiff was not true and valid.
[Para 19) [181-C-E)

(Rani) Kulandai Pandichi and Anr. v. Jndran Ramaswami Pandia B
Thevan AIR (1928) Madras 416; Saraswati Bala Samanta and Ors. v.
Surabala Dassi and Ors., AIR [1957) Calcutta 57; Devassi v. Anthoni, AIR
(1969) Kerala 78 and Nathji and Anr. v. Languria and Anr., AIR (1925)
Allahabad 272, referred to.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5107 of2000. c
From the Judgment and Order dated 30.04.1999 of the High Court of
Judicature at Madras in S.A. No. 230of1987.

V. Prabhakar, Ramjee Prasad, V. Subramani and Revathy Raghavan for
the Appellants. D

The Judgment of the Court was delivered by
r
DR. ARIJIT PASAYAT, J. 1. Challenge in this Appeal is to the judgment
rendered by a learned Single Judge of the Madras High Court allowing the
second appeal filed by the respondents under Section 100 of the Code of Civil E
Procedure, I908 (in short the 'Code'). Respondents are the legal representatives
of the original plaintiff.

2. According to the plaintiff, the suit properties originally belonged to
one Chelliah Nadar, he had purchased the suit properties under sale deed
F
Ex.A I dated 26.2.1973, the defendants I to 3 fraudulently created a conveyance
deed in their favour the defendants had earlier instituted O.S. No. 298 of 1973
on the file of the District Munsif Court, Srivaikuntam, the defendants obtained
orders of injunction and managed to enter into the suit properties; the
defendants have no right whatsoever, the suit O.S. No. 298 of I973 was
dismissed after contest, in appeal , the first appellate Court decreed the suit G
in favour of the plaintiffs in the said suit , present plaintiff preferred Second
+ Appeal , No. 8 of 1977, pending the said Second Appeal, said suit was
permitted to be withdrawn i.e. suit O.S. No.298 of 1973 but without liberty to
file a fresh suit on the same cause of action, the defendants have no right
in the suit property and the defendants who have no right are in enjoyment
H
176 SUPREME COURT REPORTS [2007) 5 S.C.R.

A of the suit properties since 11.6.1973. r-

3. It was the further case of the plaintiffs that the defendants have cut
and carried away the Odai trees worth Rs.1500/- the defendants have been
tapping toddy from 42 palmyra trees since 1973 standing on the suit properties;
the defendants have also cut and carried away two palmyra trees worth Rs.
B 200/-, the defendants have been cultivating ground nut and derived income
of Rs. 1000/-, the palmyra trees would fetch an income of Rs. 400/- per annum;
the defendants 1 and 3 are liable to pay Rs. 5100/- towards past mense profits
and the plaintiffs are entitled for recovery of possession besides past and
future mense profits from the defendants.
c 4. The defendants 1 and 3 filed a written statement inter alia pleading
that the suit properties originally belonged to Chelliah Nadar and his brother;
the defendants have purchased the properties from Chelliah Nadar on 8.10.1971,
the plaintiff herein attempted to interfere with the defendants' possession, the
plaintiff had not purchased the suit property from Chelliah Nadar, on the
D dismissal of the said suit the defendants herein preferred A.S.No.51 of 1975
which was allowed and decreed; the Second Appeal preferred by the plaintiff
herein was pending, pending the Second Appeal , the defendants herein 1
withdrew the suit itself as they have not proved execution of the sale deed
~
by Chelliah Nadar, the plaintiff has no right to institute this suit, the plaintiff
is not entitled to the suit property, the plaintiff is not entitled to any income
E or value of the trees or income from palmyra trees and that the suit is liable
to be dismissed.
•
5. After contest, the trial Court held that the plaintiff in the present suit
is entitled to the suit property and the plaintiff is entitled to recover possession,
F the defendants I and 3 are liable to pay Rs. 2, 760/- towards past mense profits ;,
and the plaintiff is entitled to future mense profits to be ascertained under
Order 20 Rule 12 of the Code.

6. The first appellate court held that the defendant Nos. 4 to 5 have not
been imp leaded as parties to the first appeal: According to the plaintiff he had
~.
G purchased the suit property from Chelliah Nadar under Exhibit A1 on 26.2.1973.
The contesting defendants also purchased the suit property from brothers of
-\,-
Chelliah Nadar under Exhibit B-7 on 8.10.1971 and claimed to be in possession
of the property. In the earlier suit O.S. No. 298 of 1973 the orders passed have
•
great relevance and reads as follows :
...
H "After somt: lengthy arguments, Mr. K. Sarvabhauman learned
KANDAPAZHANADARv.CfilTRAGANIAMMAL[PASAYAT,J.] J77

counsel for the respondents prayed for leave to withdraw the suit. Mr. A
Ganapathi Subramaniam, learned counsel for the appellant states that
leave could be granted provided he is not given liberty to file a fresh
suit. Recording the statement I grant leave to withdraw the suit making
it clear that the plaintiffs-Respondents will have no liberty to file a
fresh suit. Accordingly the suit will stand dismissed. No costs."
B
7. The High Court observed that in terms of Order XXlll Rule I (4)(b)
when a party to the suit withdraws the suit without permission to institute
fresh suit, the parties shall be precluded from instituting the fresh suit in
respect of such subject matter or such part of the claim. The High Court
observed that the earlier suit was dismissed as the defendant had withdrawn C
the earlier suit at the second appellate stage without securing necessary
permission to institute a fresh suit. The High Court therefore, held that the
general principles of res judicata get attracted and the defendant's claim is
barred in view of the orders passed in the earlier suit between the same
parties. It is to be noted that the first appellate court had observed that the
withdrawal debarred the plaintiffs from filing a subsequent suit but it did not D
affect the defence of the defendants.

8. Learned counsel for the appellants has referred to several decisions
to contend that fresh suit is not barred and Order XXIII Rule I (4) has no
application to the facts of the cases. There is no appearance on behalf of the
respondent in spite of notice. E
9. In order to appreciate contention of learned counsel for the appellant,
it would be appropriate to quote Order XXIII, Rule 1(4) the same read as
follows:

"I (4)Where the plaintiff- F
(a) abandons any suit or part of claim under sub-rule (I), or

(b) withdraws from a suit or part of a claim without the permission
referred to in sub-rule (3 ).

he shall be liable for such costs as the Court may award and shall be G
precluded from instituting any fresh suit in respect of such subject
matter or such part of the claim."

I 0. It would also be relevant to take note of Order IX Rule 9 and Order
XXII Rule JO of the Code which read as foliows:
H
178 SUPREME COURT REPORTS [2007] 5 S.C.R.

A "Order IX, Rule 9-Decree against plaintiff by default bars fresh suit .. .
(I) Where a suit is wholly or partly dismissed under rule 8, the plaintiff
shall be precluded from bringing a fresh suit in respect of the same
cause of action. But he may apply for an order to set the dismissal
aside, and if he satisfies the Court that there was sufficient cause for
his non-appearance when the suit was called on for hearing, the Court
B shall make an order setting aside the dismissal upon such terms as to
costs or otherwise as it thinks fit, and shall appoint a day for proceeding
with the suit."

Order XXII Rule JO(!) Procedure in case of assignment before final
order in suit (I) In other cases of an assignment, creation or devolution
c of any interest during the pendency of a suit, the suit may, by leave
of the Court, be continued by or against the person to or upon whom
such interest has come or developed.

(2) The attachment of a decree pending an appeal therefrom shall be
deemed to be an interest entitling the person who procured such
D attachment to the benefit of sub-rule(!)."

11. The original suit was one for declaration of title and injunction.
Undisputedly the withdrawal was permitted but no liberty to file fresh suit
.,
I

was granted. The purpose of incorporating of Order XXIII Rule 1 is to avoid
E multiplicity of litigation. Jn the earlier suit the respondent-defendant claimed
to be the owner. The provisions contained in Order IX Rule 9 Order XXII Rule
10 relate to different concepts. It is the subject matter which is the relevant
aspect. Plaintiff has to prove his case. Order II Rule 2 also is relevant, the
same reads as follows:

F "Order II Rule 2" Suit to include the whole claim: (I) Every suit shall
include the whole of the claim which the plaintiff is entitled to make
in respect of the cause of action; but a plaintiff may relinquish any
portion of his claim in order to bring the suit within the jurisdiction
of any Court.

G (2) Relinquishment ofpart of claim- where a plaintiff omits to sue in
respect of, or intentionally relinquishes, any portion of his claim, he
shall not afterwards sue in respect of one portion so omitted or -t-
relinquished.

(3) Omission to sue for one of several relieft-A person entitled to
H more than one relief in respect of the same cause of action may sue
KANDAPAZHANADARv.CHITRAGANIAMMAL[PASAYAT,J.) J79

for all or any of such reliefs; but if he omits, except with the leave of A
the Court, to sue for all such reliefs, he shall not afterwards sue for
any relief so omitted."

12. Order II Rule 2 relates to the "relief which can be granted" while
Order XXIII Rule I refers to the "subject matter". The grant of leave is not
a matter of a right. Different subject matters are relatable to provisions contained B
in Order XXIII Rule I. In both the present and the earlier suit the subject
matter is essentially the same.

13. By the impugned judgment it has been held that since the petitioners
herein had withdrawn Suit No.298 of 1973 and since no liberty was given to
the petitioners to institute a fresh suit, the petitioners were precluded from C
raising the plea in defence that sale deed executed by Chelliah Nadar in favour
ofThangaraj Nadar dated 26.2.1973 was not true and valid. In this connection,
the Madras High Court placed reliance on Order XXIII Rule I (4) of Code.

14. The question before us is : what is the effect of order passed by D
the High Court in Second Appeal No.8 of 1977 filed by Thangaraj Nadar, in
the first round of litigation. That order is dated 27.7.78. Under that order, the
Madras High Court granted leave to withdraw the suit filed by the petitioners
herein bearing Suit No.298 of 1973, making it clear that the petitioners herein
(plaintiffs in earlier suit) were not given liberty to file a fresh suit. Does it
mean that petitioners-defendants were estopped from raising the defence E
regarding validity of the conveyance in their favour by Chelliah Nadar dated
8.10.71.

15. In the case of (Rani) Ku/andai Pandichi and Anr v. lndran
Ramaswami Pandia Thevan, AIR (1928) Madras 416, it has been held as
follows: F
"Permission to withdraw a suit decides no matters in controversy and
does not confer any rights on a party and the fact that the person
withdrawing is precluded from bringing a fresh suit on the same cause
of action cannot be said to have that effect. It has been held that an
order permitting the withdrawal of a suit or appeal is not a decree
G
within the meaning of the Civil Procedure Code. We need only refer
to Patlogi v. Gam, (1891) 15 Born. 370, Jogodindra Nath v. Sarai
Sundari Debi, - (1891) 18 Cal. 322 and Abdul Hussain v. Kasi Sahu,
- (I 900) 27 Cal. 362"
H
180 SUPREME COURT REPORTS (2007] 5 S.C.R.

A (emphasis supplied) y -

16. In the case of Saraswati Bala Samanta and Ors v. Surabala Dassi
and Ors., AIR (1957) Calcutta 57, it has been held vide para 3 as follows:

"(3) The order recording the withdrawal of the suit is not a
B decree. There was no question therefore, of drawing the order as a
decree. The order recording the withdrawal can however be formally
drawn up under R.187 Part I, Chapter I of the Civil Rules and Orders,
Vol. I, inasmuch as the order directed payment of costs by the plaintiff
to the defendant. We, therefore, treat the so called decree as an
order."
c
(emphasis supplied)

17. In the case of Devassi v. Anthoni, AIR (1969) Kerala 78, it has been
held vide para I as follows:

D "(!).None of the conditions in Sub-section(!) of Section JOO of
the Code is here satisfied. Indeed, the dismissal of the appellant
defendant's appeal to the court below can be supported on the short
ground that that appeal did not lie. This is a case where the plaintiff i
withdrew his suit under Sub-rule (I) of Rule I of Order XXIII - he
was competent to do that and required nobody's permission since he
E was the sole plaintiff, the defendant, as we shall presently see being
in no sense a plaintiff - and the so-called dismissal of the suit as
withdrawn by the trial Court was not really a dismissal but a mere
recording of the fact ofwithdrawaL It determined none of the matters
in controversy in the suit - there was no claim by the defendant to
be determined - and is not a decree as defined by Section 2 (2) of
F
the Code. It stands on the same footing as a dismissal under Rule 8
of Order IX which, because the word, "dismissal" implying a
determination on the merits is used by the Rule, is expressly excluded
from the definition in Section 2 (2) by Clause (b) of the exclusions
therein. It is the provision in Sub-rule (3) of Rule I of Order XXIII (like
G that in Rule 9 of Order IX) and not any principle of res judicata that
precludes the plaintiff in such a case from bringing a fresh suit in
respect of the same matter. It follows that there being no decree no -t--
appeal lay under Section 96 of the Code. Reference may be made in
this connection to Kulandai v. Ramaswami, AIR (1928) Mad 416 at
p. 418, Saraswati Bala v. Surabala Dassi, AIR (1957) Cal 57 and
H
KANDAPAZHANADARv.CHITRAGANIAMMAL[PASAYAT,J.] 181
Raisa Sultana Begam v. Abdul Qadir, AIR (1966) ~.II 318 at p. 320." A
(emphasis supplied)

18. In the case of Nathji and Anr v. Languria and Anr., AIR (1925)
Allahabad 272, it has been held that where in the case of an application to
withdraw a suit in terms of Order 23 Rule 1(2) C.P.C., the Court allows the suit B
to be withdrawn but refuses permission to bring a fresh suit, the court's order
is erroneous. It was held that if the trial court saw no reason for allowing
the withdrawal in terms of Order 23 Rule I (2), the trial court should have
refased the application seeking liberty to file a new suit and it should have
proceeded with the suit on merits.
c
19. In view of the above judgments, the position in law is clear that
when the court allows the suit to be withdrawn without liberty to file a fresh
suit, without any adjudication, such order allowing withdrawal cannot
constitute a decree and it cannot debar the petitioners herein from taking the
defence in the second round of litigation as held in the impugned judgment. D
The above judgments indicate that if the plaintiff withdraws the suit, the order
of the court allowing such withdrawal does not constitute a decree under
~ Section 2(2) of Code. That in any event, it will not preclude the petitioners
~ herein (defendants in second round) from raising the plea that the sale deed
executed by Chelliah Nadar on 26.2. 73 in favour of Thangaraj Nadar was not
true and valid. Thus, the civil appeal needs to be allowed. E
K.K.T. Appeal allowed.