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TMI Blog2013 (12) TMI 1673X X X X Extracts X X X X X X X X Extracts X X X X ..... fficial liquidator had no objection for releasing the premises in favour of the landlord and as the sub- tenant was the only contesting party, and accordingly granted leave. The principle of res judicata debarring the appellant to file an application for grant of leave and further the observation liberty to applicant to apply does not enable the appellant to get out from that legal labyrinth because it does not confer a right on a party to re-agitate the matter. It operates at the successive stages in the same litigation but the basic foundation of Res Judicata rests on delineation of merits and has at least an expression of an opinion for rejection of an application. In order to attract it, it must be manifest that there has been conscious adjudication of an issue. A plea of res judicata cannot be taken aid of unless there is an expression of an opinion on the merits. It is well settled in law that principle of res judicata is applicable between the two stages of the same litigation but the question or issue involved must have been decided at earlier stage of the same litigation The appeal was allowed and the order of set aside was passed by the Division Bench and restore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enancy or sub-tenancy that the premises could be returned to the landlord. The said order was assailed before the Division Bench which by order dated 22.8.2000 accepted the reasoning ascribed by the learned single Judge and dismissed the appeal. 4. As the factual matrix would further undrape, the father of the appellant filed an application for amendment of the plaint in the suit for incorporation of the certain other grounds including the unlawful subletting by the respondent-company to the first respondent and the said amendment was sought to be made in terms of Section 3(1)(b) of the Bombay Rent Act, 1947. Eventually, by order dated 9.11.2000 the said application for amendment was rejected on the ground that the Bombay Rent Act had been repealed on 31.3.2000. Thereafter, Suit No. 226/336 of 2001 was instituted in the Small Causes Court for eviction on the ground of illegal subletting. As set forth, the said suit was filed after obtaining leave from the Companies Court under Section 446 of the Companies Act, 1956 (for short the 1956 Act ). On 2.1.2002 as the original plaintiff, the father of the present appellant expired, an application for substitution was filed and thereaft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e further observed that as no provision of law had been shown under which the proposed defendants to the suit were required to be heard before leave was granted under Section 446 of the 1956 Act. He also took note of the fact that the official liquidator in the earlier proceedings had made a statement to the court that the suit premises were not required by the liquidator for effective management of the winding up proceedings and the order was passed without prejudice to the rights and contentions of the official liquidator and further it was observed that it would be open for the official liquidator to raise all such contentions as permissible in law. The learned Company Judge also took note of the fact that the tenancy right of the company had not been disputed by the plaintiff and no decree could be passed without a full-fledged trial in the suit. Being of this view, he dismissed the application. 8. The said order came to be assailed in appeal No. 779 of 2006 before the Division Bench which by order dated 7.11.2006, upon adumbration of all the facts and delineation of the impugned orders, set aside the orders dated 27.7.2006 and 28.9.2006 as the learned Company Judge had not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noted, the learned Company Judge while granting leave has opined thus: - The issues involved in the suit and the reliefs claimed cannot be adjudicated upon or decided by this Court in exercise of company jurisdiction. That jurisdiction shall be with the court trying the suit. The interest of the company in liquidation is not at all involved in the said suit as already recorded hereinabove for the reasons stated. Therefore, the question of invocation of jurisdiction of the Small Causes Court either under Section 28 of the Bombay Rent Act or under Section 33 of the Maharashtra Rent Act or under Section 41 of the Presidency Small Causes Court Act is not relevant for the purpose of grant of leave because the question of jurisdiction of the court will have to be decided on the basis of the plaint pleadings. The small Causes Court would be well within its right to decide its own jurisdiction. In the event; it comes to the conclusion that it has no jurisdiction to try a suit under the Presidency Small Causes Court Act, in that event, it would be open for that Court either to return or reject the plaint or permit the conversion of the suit. All these conflicting questions need not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge. To interpret the term grant of liberty the Division Bench held that on the basis of the grant of liberty the case could not have been reopened. For the said conclusion reliance was placed on Kewal Chand Mimani v. S.K. Sen and others[(2001) 6 SCC 512]. The Division Bench, however, clarified that the respondent No. 3 therein would be entitled to make an application for grant of leave for instituting a fresh suit after taking recourse to such remedy for annulment of the order dated 23.2.2006 passed in Company Application No. 45 of 2006. 12. We have heard Mr. Shyam Divan, learned senior counsel appearing for the appellant and Mr. Shekhar Naphade, learned senior counsel appearing for the respondents. 13. The central issues that seems to be cemented by the verdict of the Division Bench are that the order dated 23.2.2006 passed by the learned single Judge in Company Application No. 45 of 2006 in Company Petition No. 201 of 1994 operates as res judicata debarring the appellant to file an application for grant of leave and further the observation liberty to applicant to apply does not enable the appellant to get out from that legal labyrinth because it does not confer a right ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the learned Judges of the Division Bench have correctly understood the observation of the learned Company Judge liberty to applicant to apply and in law, no benefit did accrue to the appellant to file another application in the said proceeding for grant of leave. That apart, the appellant chose not to file amendment in the pending suit which was conceded not to be opposed by the respondents but, on some pretext or other he filed another application for grant of leave to institute a suit under another enactment and, therefore, the Division Bench has rightly unsettled and dislodged the order passed by the learned Company Judge. 17. To appreciate the submissions in their proper perspective, we may refer to Section 446 of the 1956 Act which reads as follows: - 446. Suits stayed on winding up order. (1) When a winding up order has been made or the Official Liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced, or if pending at the date of the winding up order, shall be proceeded with, against the company, except by leave of the Tribunal and subject to such terms as the Tribunal may impose. (2) Tribunal shall, notwit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 446(1) of the 1956 Act before institution of execution proceedings. The Court considered the contrary views expressed by different High Courts on the effect and purport of Section 446(1) of the 1956 Act and came to the conclusion that the view that failure to obtain leave prior to institution of suit would not debar the court from granting such leave subsequently and that the only consequence of the same would be that the proceedings would be regarded as having been instituted on the date on which the leave was obtained from the High Court. 21. We have referred to the aforesaid decisions solely for the two purposes. First, grant of leave of the court is not a condition precedent for initiation of a civil action or the legal proceedings. It is because the Section does not expressly provide for annulment of a proceeding that is undertaken without the leave of the court. There can be no shadow of doubt that leave of the winding up court can be obtained even after initiation of the proceeding. The second, the seminal object behind engrafting of the said provision is to see that the interest of the company is safeguarded so that it does not face deprivation of its right and claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the decree. The aforesaid order was challenged in a revision under Section 115 of the Code of Civil Procedure. At the time when the revision application was taken up for hearing, the Calcutta Thika Tenancy Ordinance had come into force on October 21, 1952 and thereafter the Calcutta Thika Tenancy (Amendment) Act, 1953 came into force. The Amendment Act omitted Section 28 of the original Act. In order to decide whether the application under Section 28 was still alive, the High Court had to consider the effect of Section 1(2) of the Amendment Act. The learned Single Judge on interpretation of the provisions came to hold that Section 1(2) of the Amendment Act did not affect the operation of Section 28 of the original Act to the proceeding and on that basis disposed of the application holding that Section 28 was applicable. The High Court had also held that in view of the amended provision of Section 28 of the Thika Act and the Ordinance which was recorded by the learned Munsif, the revisionists before the High Court were Thika tenants. Being of this view, he allowed the revision and set aside the order of the Munsif by which he dismissed the application under Section 28 and remanded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Code and the Court considers that there is not any good cause for the previous non-appearance and proceeds further with the suits and ultimately results in an ex parte decree, can a court in dealing with applications to set aside the ex parte decree under Order IX Rule 13 reconsider the question as to whether the defendant had a sufficient cause for non-appearance on the day in regard to which the application under Order IX Rule 7 had been filed. The Court referred to the decision in Satyadhyan Ghosal (supra) and quoted a passage from the said decision and thereafter took note of two submissions advanced by the learned counsel for the respondents therein which were to the effect that (1) an issue of fact or law decided even in an interlocutory proceeding could operate as res judicata in a later proceeding, and (2) in order to attract the principle of res judicata the order or decision first rendered and which is pleaded as res judicata need not be capable of being appealed against. Dealing with the same the Court observed thus: - We agree that generally speaking these propositions are not open to objection. If the court which rendered the first decision was competent to entert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esigned to ensure the just, smooth, orderly and expeditious disposal of the suit. They are interlocutory in the sense that they do not decide any matter in issue arising in the suit, nor put an end to the litigation. 28. In Prahlad Singh v. Col. Sukhdev Singh[AIR 1987 SC 1145] an ex-parte decree passed in a petition for eviction based on ground of default in payment of rent was set aside on the finding that the landlord had agreed to withdraw the petition and accept rent from the tenant. After the decree was set aside the petition for eviction was once again ordered on the ground of default of payment of rent for the same period. The submission of the tenant that the eviction petition could not be allowed to continue and deserved to be dismissed on the finding of the court in the proceeding for setting aside the ex parte order was negatived by the High Court on the ground that those findings were made in the context of setting aside the ex parte order and not in the context of deciding the main petition for eviction. This Court, in appeal by special leave preferred by the tenant, observed that the view of the High Court was not right, for the decision given by a court at earlier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct does not bar the eviction proceeding against the tenant, had become final and could not be re-agitated. However, the High Court recorded a finding that Section 15 of the Act did not bar the subsequent eviction petition and being of that view dismissed the revision petition. A contention was raised before this Court that order passed by the appellate authority holding that the eviction petition was maintainable and Section 15 of the Act was not a bar, does not operate as res judicata. In that context, this Court observed as follows: - In the light of the above discussion we hold that as the question whether S. 15 of the Act bars the present eviction petition, was decided against the appellants by the appellate authority at the earlier stage of the suit and it was allowed to become final, it is not open to the appellants to reagitate the same at the subsequent stage of the suit. In this view of the matter, we do not find any illegality in the order under appeal to warrant any interference. 31. From the aforesaid decision it is clear that this Court concurred with the view of the High Court as a finding was returned that the proceeding was not barred by Section 15 of the Ke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall not reopen the question of fact in revision. It is manifest that, this Court has taken note of the fact that there was an expression of opinion by the High Court that facts need not be adverted to again by the tribunal and that attracted the principle of res judicata. 34. From the aforesaid authorities it is clear as crystal that to attract the doctrine of res judicata it must be manifest that there has been conscious adjudication of an issue. A plea of res judicata cannot be taken aid of unless there is an expression of an opinion on the merits. It is well settled in law that principle of res judicata is applicable between the two stages of the same litigation but the question or issue involved must have been decided at earlier stage of the same litigation. In the case at hand, as the order dated 23.2.2006 would show that a statement was made by the counsel for the third respondent that in the event of the petitioner s making an application for amendment of the plaint in the pending suit on the basis of the averments made in the summons issued, he would not oppose the same. The learned Company Judge recorded the same and opined that it is not necessary to grant the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment. However, the Division Bench had stated liberty to mention the matter. Shortly thereafter, the matter was taken up by the concerned Collector to which certain objections were raised. In the said case, as the factual matrix would unfurl, on 23.5.1997 the matter was mentioned before the Appellate Bench by the learned advocate for the State arguing for extension of time for making over possession in terms of the order and the High Court thereupon extended the time. However, it directed the matter to appear on a particular day. Subsequently, a formal application was filed by the owners for a direction to restore the possession of the premises in question to the owners as the appellants, as alleged, were not the owners. It was on the state of facts the second judgment was pronounced by the Appellate Bench which directed making over of possession to the owners without prejudice to the rights and contentions of the parties and without prejudice to the rights of the lessee to file a suit for appropriate proceedings for recovery or otherwise and/or to enforce an agreement for purchase of the properties in accordance with law. The High Court allowed 48 hours time from the date of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it must be conferred by law either specifically or by necessary implication. 36. After so stating the Court referred to the decision in State of U.P. v. Brahm Datt Sharma[(1987) 2 SCC 179] wherein it has been held that when proceedings stand terminated by final disposal of writ petition it is not open to the court to reopen the proceedings by means of a miscellaneous application in respect of a matter which provided a fresh cause of action, for if the said principle is not followed, there would be confusion and chaos and the finality of the proceedings would cease to have any meaning. 37. Coming to the case at hand, the Division Bench, after reproducing paragraph 19 of the judgment in Kewal Chand Mimani s case, held that the liberty granted by the learned single Judge to file an application was not maintainable, for the liberty granted by the learned single Judge cannot be used to seek from him orders which are contrary to his principal order rejecting the company application for grant of leave. On a studied scrutiny of the order passed by the learned single Judge on 23.2.2006, we find that the Division Bench has committed three fundamental errors, namely (i) that the learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any Judge adjudicated the matter on merits, the matter would have been absolutely different. He had, in fact, on the basis of a statement made by the learned counsel for the third respondent, had not dwelled upon the merits and, in that context, had granted liberty to applicant to apply, if necessary. It is eminently so because the learned Judge has also stated it is not necessary to grant the present Judge s Summons . Thus, the application for grant of leave was really not dealt with on merits and on the basis of a statement of respondent No. 3 the learned Company Judge opined that it was not necessary for the present and in that context liberty was granted. The principles stated in Arjun Singh (supra), Satyadhyan Ghosal (supra) and the other authorities clearly spell out that principle of res judicata operates at the successive stages in the same litigation but, the basic foundation of res judicata rests on delineation of merits and it has at least an expression of an opinion for rejection of an application. As is evident, there has been no advertence on merits and further the learned Company Judge has guardedly stated two facets, namely, not necessary to grant present Judge s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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