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Issues involved: Application under Order 7, rule 11 of the Code of Civil Procedure for rejection of plaint based on res judicata and maintainability of suit challenging a compromise decree.
Issue 1: Res Judicata The appellant-petitioner filed a suit seeking a declaration that a compromise decree was obtained fraudulently. The respondent argued that the suit was barred by res judicata. The Court discussed the principle of res judicata as per Section 11 of the Code, emphasizing finality of litigation and equity. It was held that for res judicata to apply, there must be sufficient pleading and records from the earlier proceeding. The Court noted that while considering an application under Order 7, rule 11, only the plaint and its annexed documents should be examined, not the defense of the defendants. Therefore, the plea of res judicata alone cannot lead to rejection of the plaint. Issue 2: Suit challenging a compromise decree The respondent also argued that the suit was not maintainable under Order 23, rule 3A of the Code. The Court referred to relevant judgments but found that this point was not raised in the application under Order 7, rule 11. It was deemed improper to allow a new plea at the appeal stage without giving the appellant a chance to respond. The Court set aside the order, rejected the application under Order 7, rule 11, and directed expeditious disposal of the suit without delving into the merits of the claims. The appeal was disposed of, and no costs were awarded. Separate Judgment: The judgment was delivered by Harish Tandon, J., with agreement from Shubhro Kamal Mukherjee, J. The Court emphasized procedural fairness and adherence to pleadings in deciding on the rejection of the plaint based on res judicata and maintainability of the suit challenging a compromise decree. The importance of not allowing new pleas at the appeal stage without proper opportunity for response was highlighted. The Court directed expeditious disposal of the suit while leaving all issues open for determination.
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