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Civil Law

Constructive Res Judicata

 07-May-2025

SC Gupta v. Union of India And Anr.  

“In case it is held that the principle of Constructive Res Judicata will not be applicable to writ proceedings, that will clearly be against the public policy, as finality of decisions is an important facet of it.” 

Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela 

Source: Delhi High Court  

Why in News? 

A bench of Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela held that constructive res judicata shall be applicable to writ proceedings as well.  

  • The Delhi High Court held this in the case of SC Gupta v. Union of India and Anr. (2025). 

What was the Background of SC Gupta v. Union of India and Anr.(2025) Case?   

  • The Central Board of Excise and Customs issued revised guidelines on 31st July 2015, for granting rewards to informers and Government Servants in cases of seizure or infringement of customs duties. 
  • The guidelines state that rewards are ex-gratia payments that cannot be claimed as a matter of right and should not be granted as a routine. 
  • The petitioner provided intelligence to the authorities on 29th January 2001, concerning evasion of central excise duty. 
  • The authorities issued a show cause notice to the defaulting company on April 8, 2003, demanding Rs. 23.89 crores in unpaid duties. 
  • On 10th February 2020, a settlement was reached under the "Sabka Vishwas Scheme," reducing the liability to Rs. 11.94 crores (50% of the original demand). 
  • The petitioner made a representation on 18th May 2023, demanding 20% of the realized tax (Rs. 2.33 crores) as a reward. 
  • The authorities granted the petitioner a reward of Rs. 25 lakhs (2% of the claimed reward), which the petitioner found unsatisfactory. 
  • The petitioner raised a grievance with the Centralized Public Grievance Redress and Monitoring System (CPGRAMS), which closed the case on 23rd July 2024. 
  • The petitioner filed a writ petition (W.P.(C) No. 14658/2024) challenging the CPGRAMS order, but it was dismissed by a Single Judge on 29th October 2024. 
  • The petitioner then filed an intra-court appeal (LPA 1219/2024), which was also dismissed by a Division Bench on 17th December 2024. 
  • The current petition challenges the constitutional validity of Clause 3.3.1 of the Guidelines, which gives discretionary power to authorities for determining rewards.

What were the Court’s Observations?

  • The only issue to be determined here was whether the prayer made in the present petition is barred by the principle of constructive res judicata. 
  • The Court observed that an explanation is provided in Section 141 of Civil Procedure Code, 1908 (CPC) which provides that the expression “proceedings” occurring in Section 141 includes proceedings under Order IX but does not include any proceeding under Article 226 of the Constitution of India, 1950 (COI). 
  • The Court held in the present case that if it is held that constructive res judicata shall not apply to writ proceedings it would be against the public policy as finality of decisions is an important facet of it. 
  • The court determined that the principle of Constructive Res Judicata applies to this case, as the petitioner could have challenged Clause 3.3 of the Guidelines in the earlier litigation but failed to do so. 
  • The court held that permitting such a challenge now would lead to endless litigation between the parties, contrary to the public policy purpose of the Constructive Res Judicata doctrine which aims to prevent multiplicity of litigation. 
  • Based on these reasons, the court concluded that the prayer made in the present writ petition is barred by the principle of Constructive Res Judicata and therefore the petition is not maintainable. 

What is Constructive Res Judicata? 

  • 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. 
  • 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 which have been directly and substantially in issue and between the same parties.  
  • 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.  
  • The Hon’ble Supreme Court in the case of M. Nagabhushana v. State of Karnataka, (2011) held that principle of Constructive Res Judicata as explained in the Explanation IV of Section 11 of CPC is applicable to Writ Petitions. 

Civil Law

Order XVIII Rule 17 of CPC

 07-May-2025

Shubhkaran Singh v. Abhayraj Singh & Ors. 

“Under Order XVIII Rule 17 CPC, only the court may question a recalled witness for clarification, and parties cannot recall or cross-examine the witness without the court's express permission.” 

Justices JB Pardiwala and R Mahadevan 

Source: Supreme Court  

Why in News? 

Recently, the bench of Justices JB Pardiwala and R Mahadevan held Order XVIII Rule 17 of the Civil Procedure Code, 1908 (CPC) empowers the court to recall a witness only to seek clarification, not for further examination or cross-examination by parties. 

  • The Supreme Court held this in the matter of Shubhkaran Singh v.Abhayraj Singh & Ors. (2025). 

What was the Background of Shubhkaran Singh v.Abhayraj Singh & Ors.(2025) Case ? 

  • The petitioner, Shubhkaran Singh, filed a petition under Order XVIII Rule 17 of the Civil Procedure Code, 1908 before the trial court. 
  • The petitioner sought to recall certain witnesses for further examination, cross-examination, or re-examination. 
  • The trial court rejected the petitioner's application under Order XVIII Rule 17 of the CPC. 
  • Aggrieved by the trial court's decision, the petitioner approached the High Court of Madhya Pradesh at Jabalpur by filing Miscellaneous Petition No.7264/2024. 
  • The High Court, vide order dated 07th January 2025, dismissed the petition and upheld the trial court's decision. 
  • The petitioner thereafter filed Review Petition No.117/2025 before the High Court, which was also rejected vide order dated 27.02.2025. 
  • Being dissatisfied with both orders, the petitioner approached the Supreme Court of India by way of Special Leave Petition (Civil) Nos.12012-12013/2025. 
  • No offence was alleged in the present matter, as it pertains to a civil proceeding regarding the recall of witnesses under procedural law. 

What were the Court’s Observations? 

  • The Supreme Court observed that Order XVIII Rule 17 of the CPC confers power upon courts to recall witnesses, which should be exercised sparingly and only in exceptional cases for removing ambiguities and clarifying statements, not for filling lacunae in a party's case. 
  • The Court held that the power to recall and re-examine witnesses is exclusively vested with the court trying the suit, not with the parties, and parties cannot object to questions asked by the court or cross-examine witnesses without the court's permission. 
  • The Court emphasized that Order XVIII Rule 17 does not authorize parties to recall witnesses for examining, cross-examining, or re-examining them at their instance. 
  • The Court noted that parties may seek to recall witnesses only by invoking the court's inherent jurisdiction under Section 151 of the CPC if circumstances warrant such action. 
  • Referring to K.K. Velusamy v. N. Palanisamy, the Court reiterated that Order XVIII Rule 17 primarily enables courts to clarify issues by recalling witnesses and is not intended for routine use. 
  • The Court observed that misuse of this provision would defeat the purpose of CPC amendments aimed at expediting trials, noting that no offence was alleged in this matter as it pertains to procedural aspects of civil litigation.

What is Order XVIII Rule 17 of the CPC ?

  • Order XVIII Rule 17 of the Code of Civil Procedure, 1908 empowers the Court to recall any witness who has been examined at any stage of a suit. 
  • The provision vests the Court with the discretionary authority to put such questions to the recalled witness as it deems fit, subject to the law of evidence in force. 
  • This power is exercisable by the Court at any stage of the proceedings, including during the stage of writing the judgment. 
  • The provision serves as a procedural mechanism to assist the Court in clarifying ambiguities and resolving doubts arising from the evidence already on record. 
  • The exercise of power under Order XVIII Rule 17 is judicial in nature and must be exercised in accordance with the established principles of natural justice. 
  • The rule operates as an exception to the general rule that once a witness's examination is complete, they cannot be recalled, thereby enabling the Court to elicit further information when necessary for the just determination of the case. 

Civil Law

Section 17 of Limitation Act

 07-May-2025

Santosh Devi v. Sunder 

“We are of the opinion that the fraud relating to the sale transaction as alleged itself would not help the plaintiff in getting over the plea of limitation in this case. As already discussed, under Section 17 of the Limitation Act, the plaintiff should have been kept out of knowledge of his right to sue by means of fraud. We are of the opinion that the alleged fraud relating to the sale transaction itself has nothing to do with the question viz., that the plaintiff had been kept out of knowledge of his right to file a suit for cancellation of the sale deed because of fraud.” 

Justices J.B. Pardiwala and R. Mahadevan 

Source: Supreme Court  

Why in News? 

Recently, the bench of Justices J.B. Pardiwala and R. Mahadevan held that mere allegation of fraud is insufficient; the plaintiff must prove that the fraud actively concealed the right to sue to claim benefit under Section 17 of the Limitation Act, 1963. 

  • The Supreme Court held this in the matter of Santosh Devi v. Sunder (2025). 

What was the Background of Santosh Devi v. Sunder (2025) Case? 

  • The dispute centers around a sale deed (No. 638) executed and registered on 26th May 2008, along with the corresponding mutation entry (No. 5340) dated 29th August 2008. 
  • The Appellant-Plaintiff, Santosh Devi, filed Civil Suit No. 310-RBT of 2012 in the Court of Additional Civil Judge (SD), Ganaur on 12th October 2012, seeking:  
    • Declaration that the sale deed and mutation were invalid to the extent of 1/2 share executed in favor of the Respondent-Defendant Sunder 
    • Mandatory injunction directing the Respondent to execute and register a corrected sale deed and mutation in favor of the Appellant 
    • Permanent injunction restraining the Respondent from alienating any part of the suit property 
  • The Appellant's contention was that:  
    • She had paid the entire sale consideration for the property. 
    • The Respondent had fraudulently and forcibly managed to get his name included in the sale deed for 1/2 share without contributing to the purchase price. 
    • She only discovered this alleged fraud in March 2010, approximately two years after the execution of the deed. 
  • The Appellant was a signatory to the sale deed and was present at the time of its execution and registration. She was working as a property dealer at the relevant time. 
  • The Appellant served a legal notice on the Respondent on 19.09.2012 regarding the matter, which was allegedly refused by the Respondent on 08.10.2012. 
  • The litigation proceeded through three tiers of courts:  
    • Trial Court: Dismissed the suit primarily on grounds of limitation. 
    • First Appellate Court: Affirmed the trial court's decision. 
    • High Court of Punjab and Haryana: Dismissed the second appeal vide judgment dated 23rd July 2024. 
  • Both the trial court and the appellate court found that the Appellant was fully aware of the contents of the sale deed at the time of its execution, as the deed writer had read it aloud before all parties who then affixed their signatures acknowledging its correctness. 
  • The limitation period for filing a suit for cancellation of a sale deed is three years from the date of execution of the deed (Article 59 of the Limitation Act, 1963). 
  • The Appellant's suit was filed more than four years after the execution of the sale deed. 

What were the Court’s Observations? 

  • The Supreme Court observed that when a registered document is challenged, the initial onus of proof lies upon the person challenging the document, as there exists a legal presumption that a registered document is validly executed. 
  • The Court noted that when fraud is alleged as a ground for exemption from limitation, it is an acknowledged rule of pleading that the plaintiff must set forth the particulars of the fraud with specificity, not merely make general allegations. 
  • The Court observed that Order VII Rule 6 of the Civil Procedure Code, 1908 mandates that "the plaint shall show the ground upon which exemption from such law is claimed," requiring specific factual statements to establish the basis for exemption. 
  • The Court held that mere use of general words such as 'fraud' is ineffective to provide the legal basis for exemption in the absence of particular statements of fact which alone can furnish the requisite foundation for the action. 
  • The Court distinguished between fraud relating to the transaction itself and fraud that prevents a plaintiff from knowing their right to sue, clarifying that Section 17 of the Limitation Act is concerned with the latter. 
  • The Court observed that under Section 17 of the Limitation Act, the plaintiff must establish that they were kept out of knowledge of their right to sue by means of fraud perpetrated by the defendant. 
  • The Court found that the alleged fraud relating to the sale transaction itself had no nexus with keeping the plaintiff unaware of her right to file a suit for cancellation of the sale deed. 
  • The Court noted that no specific reference to the provisions of Section 17 of the Limitation Act was made in the plaint, though the pleading proceeded on the hypothesis that the plaintiff had contributed along with the defendant in the purchase. 
  • The Court observed that for claiming exemption under Section 17 of the Limitation Act, it must be demonstrated that the defendant actively prevented the plaintiff from discovering the fraud or the plaintiff could not, with reasonable diligence, have discovered it earlier. 
  • The Court opined that where an alleged fraud involves a documented transaction to which the plaintiff was party and signatory, a higher threshold of proof is required to establish that the plaintiff could not have discovered the fraud with reasonable diligence at the time of execution. 
  • The Court held that in cases where the plaintiff alleges commission of an offence involving fraud, the burden of proving the elements of such offence, including the time of discovery, rests with the plaintiff when seeking exemption from limitation. 

What is Section 17 of the Limitation Act, 1963? 

  • Section 17(1) creates a legal exception to the normal limitation periods prescribed by the Act by postponing the commencement of the limitation period in cases of fraud, mistake, or fraudulently concealed documents until discovery (actual or constructive). 
  • Under Section 17(1)(a), when a suit is based upon the defendant's fraud, the limitation period begins only when the plaintiff discovers the fraud or could have discovered it with reasonable diligence, rather than from the date of the fraudulent transaction. 
  • Section 17(1)(b) addresses situations where the defendant's fraud conceals from the plaintiff knowledge of a right or title that forms the foundation of a suit, thereby postponing the limitation period until such concealment ends. 
  • The doctrine of reasonable diligence is embedded in Section 17, requiring courts to consider not only when the plaintiff actually discovered the fraud or mistake, but also when they reasonably ought to have discovered it with proper vigilance. 
  • The proviso to Section 17(1) creates an important protection for bona fide purchasers for value, preventing the extension of limitation from affecting innocent third parties who purchase property without knowledge of any underlying fraud, mistake, or concealed document. 
  • Section 17(2) provides a separate remedy for judgment-creditors whose decree execution was prevented by the judgment-debtor's fraud or force, allowing application for extension of the execution period within one year of discovering the fraud or cessation of force.