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Tuesday, April 9, 2013

10. Stay of suit.- No Court shall proceed with the trial of any suit in which the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties, or between parties under whom they or any of them claim litigating under the same title where such suit is pending in the same or any other Court in India having jurisdiction to grant the relief claimed, or in any Court beyond the limits of India established or continued by the Central Government and having like jurisdiction, or before the Supreme Court. Explanation.- The pendency of a suit in a foreign Court does not preclude the Courts in India from trying a suit founded on the same cause of action.”= what “the matter in issue” exactly means? = As in the present case, many of the matters in issue are common, including the issue as to whether the plaintiffs are entitled to recovery of possession of the suit premises, but for application of Section 10 of the Code, the entire subject-matter of the two suits must be the same. This provision will not apply where few of the matters in issue are common and will apply only when the entire subject matter in controversy is same.= while in the first set of petitions, the respondents had sought eviction on the ground that the appellant had ceased to occupy the premises from June 1998, in the second set of petitions, the period of non occupation commenced from September 2001 and continued till the filing of the eviction petitions. That apart, the evidence produced in the first set of petitions was not found acceptable by the appellate authority because till 2-8-1999, the premises were found kept open and alive for operation, The appellate authority also found that in spite of extreme financial crisis, the management had kept the business premises open for operation till 1999. In the second round, the appellant did not adduce any evidence worth the name to show that the premises were kept open or used from September 2001 onwards. The Rent Controller took cognizance of the notice fixed on the front shutter of the building by A.K.Agarwal on 1-10-2001 that the Company is a sick industrial company under the 1985 Act and operation has been suspended with effect from 1-10-2001; that no activity had been done in the premises with effect from 1-10-2001 and no evidence was produced to show attendance of the staff, payment of salary to the employees, payment of electricity bills from September, 2001 or that any commercial transaction was done from the suit premises. It is, thus, evident that even though the ground of eviction in the two sets of petitions was similar, the same were based on different causes. Therefore, the evidence produced by the parties in the second round was rightly treated as sufficient by the Rent Control Court and the appellate authority for recording a finding that the appellant had ceased to occupy the suit premises continuously for six months without any reasonable cause.” In view of what we have observed earlier, the orders passed by the trial court as affirmed by the High Court are vulnerable and therefore, cannot be allowed to stand. In the result, the appeal is allowed and the impugned order of the trial court as affirmed by the High Court is set aside but without any order as to costs.


Page 1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 2908 OF 2013
(Arising out of S.L.P. (C) No. 14808 of 2012)
Aspi Jal & Anr. … Appellants
VERSUS
Khushroo Rustom Dadyburjor …Respondent
J U D G M E N T
The plaintiffs-petitioners, aggrieved by the
order dated 9th February, 2012 passed by the Bombay
High Court in Writ Petition No.7653 of 2011,
affirming the order dated 6th July, 2011 passed by
the Court of Small Causes at Mumbai, in R.A.E Suit
No.173/256 of 2010 whereby it has stayed the
proceedings in R.A.E. No.173/256 of 2010 till the
decision in R.A.E. Suit No.1103/1976 of 2004 andPage 2
R.A.E. Suit No.1104/1977 of 2004, have preferred
this Special Leave Petition under Article 136 of the
Constitution of India.
Leave granted.
The plaintiffs claim to be the owner of the
building known as “ Hanoo Manor” situate at Dadyseth
2
nd Cross Lane in Chawpatty area of the city of
Mumbai. According to the plaintiffs, in one of the
flats of the said building admeasuring 1856.75
sq.ft. situate on the second floor, defendant’s
father, Rustom Dady Burjor (since deceased)was
inducted as a tenant on a monthly rent of Rs.355/-.
The plaintiffs filed a suit for eviction from the
tenanted premises against the defendant being R.A.E.
Suit No.1103/1976 of 2004(hereinafter to be referred
to as the “First Suit”) before the Small Causes
Court on 6th November, 2004 on the ground of bona
fide requirement for self occupation and acquisition
of alternate accommodation by the defendant. The
plaintiffs thereafter filed another suit being
2Page 3
R.A.E. Suit No.1104/1977 of 2004 (hereinafter to be
referred to as the “Second Suit”) on the same day in
the Small Causes Court for eviction of the defendant
on the ground of non-user for several years before
the institution of the suit. The plaintiffs during
the pendency of the aforesaid two suits, chose to
file yet another suit bearing R.A.E. Suit No.
173/256 of 2010 (hereinafter to be referred to as
the “Third Suit”) on 22nd February, 2010 for
eviction of the defendant on the ground of non-user
for a continuous period of not less than six months
immediately prior to the institution of the suit.
The defendant filed an application on 29th
September, 2010 for stay of hearing of the third
suit till final disposal of the first and second
suits. The defendant made the aforesaid prayer inter
alia stating that the parties in all the three suits
are same as also the issues. It was further averred
that the subject matter of all these suits are one
and the same. According to the defendant, since the
matter in issue in the third suit is substantially
3Page 4
in issue in the earlier two suits, the trial of the
third suit is liable to be stayed until the hearing
and final disposal of the previously instituted
first and second suits. The plaintiffs filed reply
objecting to the defendant’s prayer for stay of the
third suit inter alia on the ground that the causes
of action being different, the application filed by
the defendant for stay of the third suit is fit to
be rejected. The Court of Small Causes by its order
dated 6th July, 2011, acceded to the prayer of the
defendant and stayed the third suit till final
decision in the earlier two suits. While doing so,
the trial court observed as follows:
“ 13. On bare reading of the pleading
in both suits, it clearly appears that
both suits are filed on the same ground
i.e. non user. As, I discussed earlier
one test of the applicability of
Section 10 to a particular case is
whether on the final decision being
reached in the previous suit, such
decision would operate as res-judicata
in the subsequent suit. The object of
the section is to prevent courts of
concurrent jurisdiction from
simultaneously trying two parallel
suits in respect of the same matter in
issue. Complete identity of the
subject-matter is not necessary to
attract the application of S.10 and if
4Page 5
a matter directly and substantially in
issue in a previously instituted suit
is also directly and substantially in
issue in a later suit, then under S.10
the later suit shall be stayed.”
Ultimately, the trial court came to the
following conclusion and while staying the suit
proceeded to observe as follows:
“15. .. .. But, in the present case,
it is crystal clear from pleading that
matter in issue in both suits is
directly and substantially identical.
Therefore, this is a fit case to invoke
Section 10 of the Code of Civil
Procedure.”
The plaintiffs assailed the aforesaid order by
way of a petition under Article 227 of the
Constitution of India before the Bombay High Court.
The High Court concurred with the findings and the
conclusion of the trial court and dismissed the writ
petition inter alia, observing as follows:
“ 9. … Admittedly, the Petitioner has
filed R.A.E. Suit No.1104/1977 of 2004
and R.A.E. Suit No. 173/256 of 2010 on
the ground of nonuser, though the period
is different. But, after perusing the
plaints, it is crystal clear that issue
5Page 6
involved in both the suits are similar.
Therefore, in view of Section 10 of the
Civil Procedure Code and judgment in the
matter of Challapalli Sugar Pvt. Ltd.
(Supra), it is necessary, in the
interest of justice, subsequent suit
filed by the Petitioner, i.e. R.A.E.
Suit No.173/256 of 2010 to be stayed and
the same is done by the Trial Court by
giving detailed reasons. Therefore, I do
not find any substance in the present
Petition to interfere in the well
reasoned order passed by the Trial
Court dated 6th July, 2011.”
Mr.Shyam Divan, Senior counsel appearing on
behalf of the appellants submits that in the second
suit, the plaintiffs have sought eviction on the
ground of non-user of the suit premises for several
years prior to the filing of the suits but in the
third suit it has specifically been averred that
“the defendant and his family has not been in use
and occupation of the suit premises for a continuous
period of more than six months immediately prior to
the institution of this suit without reasonable
cause”. Thus, according to Mr. Divan, the matter in
issue in the third suit is non-user of the suit
premises prior to six months from the date of
institution of the said suit. He points out that the
6Page 7
plaintiffs may fail in the earlier two suits by not
establishing the non-user of the tenanted premises
for a period of six months prior to the institution
of those suits, yet, they can succeed in the third
suit by proving the non-user of the suit premises
by the defendants for six months prior to the
institution of that suit. According to him, the
matter in issue in the third suit being
substantially different than the first two suits,
the provisions of Section 10 of the Code of Civil
Procedure, 1908 (hereinafter to be referred to as
the “Code”) is not attracted and hence, the trial
court erred in staying the third suit till the
disposal of the first two suits.
Mr. Harish N. Salve, Senior counsel appearing
on behalf of the defendant, however, submits that
the matter in issue in both the suits being non-user
of the tenanted premises by the defendant, the trial
court rightly held that the provisions of Section 10
of the Code is attracted and on that premise, stayed
the third suit.
7Page 8
We have given our thoughtful consideration to
the rival submissions and we find substance in the
submission of Mr. Divan.
Section 10 of the Code which is relevant for
the purpose reads as follows:
“ 10. Stay of suit.- No Court shall
proceed with the trial of any suit in
which the matter in issue is also
directly and substantially in issue in
a previously instituted suit between
the same parties, or between parties
under whom they or any of them claim
litigating under the same title where
such suit is pending in the same or any
other Court in India having
jurisdiction to grant the relief
claimed, or in any Court beyond the
limits of India established or
continued by the Central Government and
having like jurisdiction, or before the
Supreme Court.
Explanation.- The pendency of a
suit in a foreign Court does not
preclude the Courts in India from
trying a suit founded on the same cause
of action.”
From a plain reading of the aforesaid
provision, it is evident that where a suit is
instituted in a Court to which provisions of the
8Page 9
Code apply, it shall not proceed with the trial of
another suit in which the matter in issue is also
directly and substantially in issue in a previously
instituted suit between the same parties. For
application of the provisions of Section 10 of the
Code, it is further required that the Court in which
the previous suit is pending is competent to grant
the relief claimed. The use of negative expression
in Section 10, i.e. “no court shall proceed with the
trial of any suit” makes the provision mandatory and
the Court in which the subsequent suit has been
filed is prohibited from proceeding with the trial
of that suit if the conditions laid down in Section
10 of the Code are satisfied. The basic purpose and
the underlying object of Section 10 of the Code is
to prevent the Courts of concurrent jurisdiction
from simultaneously entertaining and adjudicating
upon two parallel litigations in respect of same
cause of action, same subject matter and the same
relief. This is to pin down the plaintiff to one
litigation so as to avoid the possibility of
contradictory verdicts by two courts in respect of
9Page 10
the same relief and is aimed to protect the
defendant from multiplicity of proceeding. The view
which we have taken finds support from a decision
of this Court in National Institute of Mental Health
& Neuro Sciences vrs. C.Parameshwara, (2005) 2 SCC
256 in which it has been held as follows:
“ 8. The object underlying Section 10
is to prevent courts of concurrent
jurisdiction from simultaneously trying
two parallel suits in respect of the
same matter in issue. The object
underlying Section 10 is to avoid two
parallel trials on the same issue by
two courts and to avoid recording of
conflicting findings on issues which
are directly and substantially in issue
in previously instituted suit. The
language of Section 10 suggests that
it is referable to a suit instituted in
the civil court and it cannot apply to
proceedings of other nature instituted
under any other statute. The object of
Section 10 is to prevent courts of
concurrent jurisdiction from
simultaneously trying two parallel
suits between the same parties in
respect of the same matter in issue.
The fundamental test to attract Section
10 is, whether on final decision being
reached in the previous suit, such
decision would operate as res-judicata
in the subsequent suit. Section 10
applies only in cases where the whole
of the subject-matter in both the suits
is identical. The key words in Section
10 are “the matter in issue is directly
and substantially in issue” in the
10Page 11
previous instituted suit. The words
“directly and substantially in issue”
are used in contradistinction to the
words “incidentally or collaterally in
issue”. Therefore, Section 10 would
apply only if there is identity of the
matter in issue in both the suits,
meaning thereby, that the whole of the
subject-matter in both the proceedings
is identical.”
In the present case, the parties in all the
three suits are one and the same and the court in
which the first two suits have been instituted is
competent to grant the relief claimed in the third
suit. The only question which invites our
adjudication is as to whether “the matter in issue
is also directly and substantially in issue in
previously instituted suits”. The key words in
Section 10 are “the matter in issue is directly and
substantially in issue in the previously instituted
suit”. The test for applicability of Section 10 of
the Code is whether on a final decision being
reached in the previously instituted suit, such
decision would operate as res-judicata in the
subsequent suit. To put it differently one may ask,
can the plaintiff get the same relief in the
11Page 12
subsequent suit, if the earlier suit has been
dismissed? In our opinion, if the answer is in
affirmative, the subsequent suit is not fit to be
stayed. However, we hasten to add then when the
matter in controversy is the same, it is immaterial
what further relief is claimed in the subsequent
suit.
As observed earlier, for application of Section
10 of the Code, the matter in issue in both the
suits have to be directly and substantially in issue
in the previous suit but the question is what
“the matter in issue” exactly means? As in the
present case, many of the matters in issue are
common, including the issue as to whether the
plaintiffs are entitled to recovery of possession of
the suit premises, but for application of Section 10
of the Code, the entire subject-matter of the two
suits must be the same. This provision will not
apply where few of the matters in issue are common
and will apply only when the entire subject matter
in controversy is same. In other words, the matter
12Page 13
in issue is not equivalent to any of the questions
in issue. As stated earlier, the eviction in the
third suit has been sought on the ground of non-user
for six months prior to the institution of that
suit. It has also been sought in the earlier two
suits on the same ground of non-user but for a
different period. Though the ground of eviction in
the two suits was similar, the same were based on
different causes. The plaintiffs may or may not be
able to establish the ground of non-user in the
earlier two suits, but if they establish the ground
of non-user for a period of six months prior to the
institution of the third suit that may entitle them
the decree for eviction. Therefore, in our opinion,
the provisions of Section 10 of the Code is not
attracted in the facts and circumstances of the
case. Reference in this connection can be made to a
decision of this Court in Dunlop India Limited vrs.
A.A.Rahna & Anr. (2011) 5 SCC 778 in which it has
been held as follows:
“35. The arguments of Shri Nariman that
the second set of rent control
petitions should have been dismissed as
13Page 14
barred by res judicata because the
issue raised therein was directly and
substantially similar to the one raised
in the first set of rent control
petitions does not merit acceptance for
the simple reason that while in the
first set of petitions, the respondents
had sought eviction on the ground that
the appellant had ceased to occupy the
premises from June 1998, in the second
set of petitions, the period of nonoccupation commenced from September
2001 and continued till the filing of
the eviction petitions. That apart, the
evidence produced in the first set of
petitions was not found acceptable by
the appellate authority because till
2-8-1999, the premises were found kept
open and alive for operation, The
appellate authority also found that in
spite of extreme financial crisis, the
management had kept the business
premises open for operation till 1999.
In the second round, the appellant did
not adduce any evidence worth the name
to show that the premises were kept
open or used from September 2001
onwards. The Rent Controller took
cognizance of the notice fixed on the
front shutter of the building by
A.K.Agarwal on 1-10-2001 that the
Company is a sick industrial company
under the 1985 Act and operation has
been suspended with effect from
1-10-2001; that no activity had been
done in the premises with effect from
1-10-2001 and no evidence was produced
to show attendance of the staff,
payment of salary to the employees,
payment of electricity bills from
September, 2001 or that any commercial
transaction was done from the suit
premises. It is, thus, evident that
even though the ground of eviction in
14Page 15
the two sets of petitions was similar,
the same were based on different
causes. Therefore, the evidence
produced by the parties in the second
round was rightly treated as sufficient
by the Rent Control Court and the
appellate authority for recording a
finding that the appellant had ceased
to occupy the suit premises
continuously for six months without any
reasonable cause.”
 (Underlining ours)
In view of what we have observed earlier, the
orders passed by the trial court as affirmed by the
High Court are vulnerable and therefore, cannot be
allowed to stand.
Mr. Divan prays that direction may be issued to
the trial court to hear all the suits together. We
restrain ourselves from issuing such direction but
give liberty to the parties if they so choose to
make such a prayer before the trial court. Needless
to state that in case such a prayer is made, the
trial court shall consider the same in accordance
with law.
15Page 16
In the result, the appeal is allowed and the
impugned order of the trial court as affirmed by the
High Court is set aside but without any order as to
costs.
………………..............................J.
 [CHANDRAMAULI KR. PRASAD]
……………….............................J.
[V. GOPALA GOWDA]
NEW DELHI
APRIL 05, 2013.
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