Delhi High Court Explains Concept Of 'Constructive Res Judicata', Says It Applies To Writ Proceedings As Well

The Delhi High Court has held that though the provisions of CPC contained in Order II Rule 2 and Section 11 (pertaining to principle of Res Judicata) may not be strictly applicable to writ proceedings, however, the broad principles enshrined therein including the principle of Constructive Res Judicata will have application even to writ proceedings.A division bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela observed,“The principle of res judicata though appears to be technical or artificial prescribed by the Code of Civil Procedure, however, the said principle is founded on considerations of public policy as well, because in case the doctrine of Constructive Res Judicata is not applied to writ proceedings, it may lead to a situation where a party will be entitled to take one proceeding after another and urge new grounds every time which will be inconsistent with the consideration of public policy.”Section 11 of the CPC contains the principle of Res Judicata, according to which, a subsequent suit in respect of a claim between the same parties is barred if an earlier suit has been tried involving the same issue.The principle of Constructive Res Judicata is an extension of the principle of Res Judicata. The origin of this principle in law can be found in the provisions contained in Order II Rule 2 read with Section 11 of the CPC.Explanation IV appended to Section 11 of the CPC provides that any matter which might or ought to have been made ground of defence or attack in a former suit shall be deemed to have been a matter directly and substantially in issue in such suit. Order II Rule 2 pertains to relinquishment of part of claim, according to which, in a situation where a plaintiff omits to sue in respect of, or intentionally relinquishes, any portion of his claim, he cannot afterwards sue in respect of the omitted portion of his claim or the claim which has been relinquished.It is significant at this juncture to take note of Section 141, according to which the doctrine of Res Judicata is not applicable to any proceedings under Article 226 of the Constitution.The High Court however, held that notwithstanding the said provision, it is well settled that as regards maintainability of successive writ proceedings and application of principle of Res Judicata, the consideration of public policy also plays a significant role.It thus held that the principle of Constructive Res Judicata will be applicable to writ proceedings and holding anything to the contrary will be clearly against the public policy, “as finality of decisions is an important facet of it”.It relied on the Supreme Court judgment in Devilal Modi v. Sales Tax Officer, Ratlam and Others (1964) where it was held that the principle of Res Judicata would be applicable to the writ proceedings as well.Similar view was expressed by the Supreme Court in the State of U.P. v. Nawab Hussain (1977) to hold that there may be a situation that the same set of facts may give rise to two or more causes of action, however, in such a case, if 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 and, therefore, such a course of action will be an abuse of the process of law.As such, the Petitioner's challenge to Clause 3.3 of the Guidelines for Grant of Reward to Informers and Government Servants, 2015 was dismissed.The Guidelines contemplate grant of rewards to informers and Government Servants for intelligence in respect of infringements/ evasion of duty/ service tax etc which are detected under certain enactments, namely the Customs Act, 1962, Central Excise Act, 1944, Narcotic Drugs & Psychotropic Substances (NDPS) Act. 1985 and the Finance Act, 1994.Clause 3.3 lays down the criteria for the grant of reward and allows the competent authority to exercise discretion for evaluation of reward on a case-to-case basis.The Petitioner herein was aggrieved by the quantum of reward granted to it and had thus challenged the provision.The High Court however noted that Petitioner's claim regarding quantum of reward was already dismissed by the High Court in an earlier round of litigation.Though the Petitioner had not challenged Clause 3.3 of the Guidelines in those proceedings, the High Court said that this prayer was available to the Petitioner then and therefore, the present writ petition is barred by the principle of Constructive Res Judicata.“Challenge to Clause 3.3 of the Guidelines, having been omitted by the petitioner in earlier round of litigation, in our opinion, by applying the principle of Constructive Res Judicata, the instant writ petition, where a prayer to strike down Clause 3.3 of the Guidelines as being unconstitutional has been made, will not be maintainable. If such a challenge is permitted, there will be no end to the litigation between the petitioner and the respondents. The principle of Constructive Res Judicata...

Delhi High Court Explains Concept Of 'Constructive Res Judicata', Says It Applies To Writ Proceedings As Well

Kapil Dhyani

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