Sharada Sanghi & Orsv.Asha Agarwal & Ors of

Synopsis

This judgment addresses the interplay between the doctrine of res judicata, the principle against vexatious litigation (nemo debet bis vexari), and the conduct of a litigant who abandons earlier proceedings. The appellants, having obtained a decree for specific performance of a contract, sought to execute it against respondents who claimed independent title under registered sale deeds. Earlier, the appellants had filed suits to cancel those very sale deeds but allowed them to be dismissed for default. The trial court (executing court) dismissed the respondents’ objection, but the first appellate court set aside that order, and the High Court affirmed. The Supreme Court, while holding that dismissal for default does not constitute res judicata under Section 11 CPC, nonetheless upheld the ultimate conclusion on the ground that the appellants’ conduct – abandoning the earlier suits, failing to implead the respondents in the specific performance suit, and thereafter seeking to relitigate the same issues – amounted to an abuse of process. The Court applied the broader equitable maxim that no one should be vexed twice for the same cause and dismissed the appeal.

2. Basic Information of the Judgment

Case Title: Sharada Sanghi & Ors. vs. Asha Agarwal & Ors.

Civil Appeal No.: 2609 of 2013

Bench: Justice Dipankar Datta and another learned judge (the judgment is authored by Justice Dipankar Datta)

Date of Decision: March 25, 2026

Citation: 2026 INSC 292

Appeal From: Judgment and decree dated 21.10.2010 of the High Court of Andhra Pradesh at Hyderabad in Second Appeal No. 470 of 2007, affirming the judgment of the first appellate court dated 17.01.2007.

3. Legal Framework

This judgment involves the interpretation of the Code of Civil Procedure, 1908 (CPC), the Transfer of Property Act, 1882 (TP Act), the Specific Relief Act, 1963, and the principles governing abuse of process and equitable estoppel.

A. Key Provisions of Law:

• Code of Civil Procedure, 1908:
  Section 11: Res judicata – bar of a suit or issue that has been heard and finally decided.
  Order IX, Rules 8 & 9: Dismissal of suit for default and bar on fresh suit on the same cause of action.
  Order XXI, Rules 97–101: Procedure for adjudication of objections to execution by third parties claiming independent title.
  Order XXIII, Rule 1: Withdrawal of suit and permission to file fresh suit.

• Transfer of Property Act, 1882:
  Section 52: Doctrine of lis pendens – transfers pendente lite are bound by the decree.

• Specific Relief Act, 1963 (pre‑2018 amendment): Specific performance was discretionary, based on equitable principles and conduct of the party.

B. Related Precedents (Discussed in the Judgment):

• Shreenath v. Rajesh (1998) 4 SCC 404: Held that under Order XXI Rule 101, all disputes between a decree‑holder and a third party claiming title are to be adjudicated by the executing court itself, obviating the need for a separate suit.

• S.C.F. Finance Co. Ltd. v. Masri (No. 3) [1987] 1 All ER 175 (CA): Laid down the principle that a litigant who has had an opportunity to prove a fact and chooses not to rely on it cannot later raise it before another tribunal – application of the maxim nemo debet bis vexari.

• K.K. Modi v. K.N. Modi (1998) 3 SCC 573: Explained that re‑litigation of an issue already raised or capable of being raised constitutes an abuse of process, even if strict res judicata is not attracted.

• Sarguja Transport Service v. State Transport Appellate Tribunal (1987) 1 SCC 5: Distinguished abandonment/withdrawal of suit without permission (which bars fresh suit) from res judicata, emphasising public policy to prevent abuse.

• S.P. Chengalvaraya Naidu v. Jagannath (1994) 1 SCC 1: Stressed that a litigant who approaches the court with falsehood has no right to relief and can be summarily dismissed.

• Satluj Jal Vidyut Nigam v. Raj Kumar Rajinder Singh (2021) 9 SCC 296: Held that a party cannot take inconsistent stands in successive proceedings after abandoning an earlier plea.

4. Relevant Facts of the Case

1. Specific Performance Suit (OS 329/1988): The appellants (Sharada Sanghi & Ors.) filed a suit for specific performance of an agreement to sell immovable property. The suit was decreed on 28.10.1998 and the decree attained finality.

2. Execution Proceedings: Appellants initiated execution (EP 37/1999). A sale deed was executed through court on 25.01.2001, and warrants for delivery of possession were issued.

3. Objection by Third Parties: Respondents 1–3 (Asha Agarwal & Ors.) filed an application under Order XXI Rules 99–101 CPC, claiming independent title and possession on the basis of registered sale deeds dated 05.07.1990 and 20.07.1990, executed by a GPA holder of one Mir Sadat Ali. Mir Sadat Ali claimed title through an alleged oral gift from the original owner.

4. Earlier Suits (OS 892/1990 & OS 893/1990): The appellants had filed these two suits seeking cancellation of the very same sale deeds. Both suits were dismissed for default (OS 892/1990 on 18.10.1996; OS 893/1990 on 27.10.1998). Restoration applications were also dismissed, and the orders attained finality.

5. Executing Court’s Order (30.01.2006): The executing court dismissed the objection, holding that the respondents had failed to prove any valid title.

6. First Appellate Court (17.01.2007): Allowed the respondents’ appeal, set aside the executing court’s order, and held that the decree in the specific performance suit was not binding on the respondents, and that the appellants must file a separate suit.

7. High Court (21.10.2010): Dismissed the second appeal summarily, holding that no substantial question of law arose.

8. Supreme Court Appeal: The appellants appealed to the Supreme Court.

5. Issues Identified by the Supreme Court

The Court framed two issues:

1. Whether the Appellate Court was right in returning the finding that the claim of the appellants was hit by res judicata and the High Court was right in affirming such finding.

2. Whether the conduct of the appellants is such that the same would disentitle them to any relief.

6. Ratio Decidendi (The Reasoning and Decision of the Court)

A. Issue 1 – Res judicata

• The Court held that dismissal of a suit for default does not constitute res judicata under Section 11 CPC because there is no “hearing and final decision” on merits.

• The Appellate Court’s reasoning that the dismissal operated as res judicata was erroneous. Thus, Issue 1 was answered in favour of the appellants.

B. Issue 2 – Conduct of the Appellants and Abuse of Process

• Although res judicata was not applicable, the Court applied the broader equitable maxim nemo debet bis vexari, si constet curiae quod sit pro una et eadem causa (no one should be twice vexed if it appears to the court that it is for one and the same cause).

• The appellants had earlier filed two suits challenging the very sale deeds under which the respondents claimed title. They allowed those suits to be dismissed for default and also let the restoration applications fail. They thus abandoned the challenge.

• By doing so, they demonstrated that they were aware of the respondents’ claims but chose not to pursue them. Having had the opportunity to litigate the issue and having allowed it to conclude by default, they cannot now re‑agitate the same issue in execution proceedings.

• The Court relied on S.C.F. Finance Co. Ltd. and K.K. Modi to hold that re‑litigation of an issue that was or could have been raised in earlier proceedings constitutes an abuse of process, even when strict res judicata does not apply.

• The Court also noted that the relief of specific performance (before the 2018 amendment) was discretionary, and a party whose conduct is inequitable may be denied the benefit of the decree in execution.

• Additionally, the appellants failed to implead the respondents in the specific performance suit despite knowing of their claims, and did not disclose the pendency of the cancellation suits to the court in the specific performance suit. This conduct was held to be inequitable and disentitled them to relief.

• Applying the principles of Sarguja Transport Service and Order XXIII Rule 1 CPC, the Court observed that permitting the appellants to pursue execution after abandoning the earlier suits would be contrary to public policy and would amount to an abuse of process.

• Consequently, Issue 2 was answered against the appellants, and the appeal was dismissed.

C. Final Conclusion

• The Supreme Court upheld the ultimate conclusion of the first appellate court and the High Court, though on different grounds. The appeal was dismissed.

7. New Legal Principles Established / Reiterated

1. Dismissal for default does not create res judicata: A suit dismissed for default without a decision on merits does not bar a subsequent suit under Section 11 CPC.

2. Broader principle against vexatious litigation: Even in the absence of strict res judicata, a litigant who had the opportunity to prove a fact and chose not to rely on it cannot later raise the same issue in subsequent proceedings – this is an application of the maxim nemo debet bis vexari.

3. Abuse of process independent of res judicata: Re‑litigation of an issue that was raised or could have been raised in earlier proceedings, especially when the earlier proceeding was consciously abandoned, constitutes an abuse of process and can be struck down summarily.

4. Conduct of the litigant in specific performance cases: Since specific performance is an equitable remedy, the court may deny enforcement to a party whose conduct is inequitable, such as failing to implead necessary parties or abandoning earlier proceedings.

8. The Court’s Analysis and Examination of Concepts

• Distinction between res judicata and nemo debet bis vexari: The Court explained that while Section 11 CPC requires a final adjudication on merits, the maxim prevents a party from being twice troubled for the same cause even where no such adjudication occurred, if the party had a full opportunity to litigate and chose not to.

• Consequences of dismissal for default under Order IX: The Court noted that Order IX Rule 9 and Order XXIII Rule 1 operate as a bar on fresh suits, reflecting a policy against relitigation even without a merits decision. This policy was applied by analogy.

• Abuse of process as per K.K. Modi: The Court adopted the view that re‑litigation of an issue already decided or capable of being decided amounts to an abuse of process, even if res judicata is not strictly applicable.

• Equitable discretion in specific performance: The Court emphasised that specific performance is not a matter of right; it is subject to the conduct of the plaintiff. The appellants’ conduct of abandoning the cancellation suits and not impleading the respondents in the specific performance suit disentitled them to relief in execution.

9. Critical Analysis of the Judgment

• Strength – Balancing legal technicalities with substantive justice: The Court correctly corrected the lower courts’ error on res judicata but still upheld the final order by applying the broader principles of equity, abuse of process, and finality of litigation. This approach prevents a party from manipulating the judicial process by abandoning proceedings and then later reviving the same issue.

• Clarity on “abuse of process”: The judgment elaborates that abuse of process is not limited to strict res judicata; it includes cases where a party had the opportunity to litigate and deliberately chose not to, only to later seek the same relief through another route.

• Potential critique – Overlap with res judicata: Some may argue that the Court’s reliance on nemo debet bis vexari in the absence of a merits decision stretches the concept. However, the Court justified it by noting that the earlier suits were dismissed for default after the defendants had filed written statements, and the appellants had the opportunity to prosecute them. The abandonment was conscious.

• Impact on execution proceedings: The judgment reinforces that executing courts can consider the conduct of the decree‑holder and may deny enforcement if the decree‑holder has acted inequitably or abused process.

10. Final Outcome

The Supreme Court dismissed the appeal. While it did not agree with the High Court’s reasoning on res judicata, it upheld the ultimate conclusion on the ground that the appellants’ conduct in abandoning the earlier cancellation suits and failing to implead the respondents in the specific performance suit amounted to an abuse of process, disentitling them to the relief sought in execution. No order as to costs.

11.  (MCQs)

1. Which of the following best describes the effect of dismissal of a suit for default on the same cause of action?
a) It operates as res judicata under Section 11 CPC.
b) It bars a fresh suit under Order IX Rule 9 CPC but does not constitute res judicata.
c) It does not bar a fresh suit in any circumstance.
d) It is automatically deemed to be a decision on merits.

2. The Supreme Court applied the maxim nemo debet bis vexari to the facts of this case because:?
a) The appellants had lost the earlier suits on merits.
b) The appellants had the opportunity to litigate the issue of validity of sale deeds in the earlier cancellation suits but chose to abandon them.
c) The respondents had already been impleaded in the specific performance suit.
d) The decree for specific performance had already been executed.

3. Which of the following was NOT a ground for the Supreme Court to deny relief to the appellants?
a) The respondents were bona fide purchasers for value without notice.
b) The appellants’ conduct in abandoning the earlier cancellation suits.
c) The discretionary nature of specific performance relief.
d) The failure to implead the respondents in the specific performance suit despite knowledge.

4. In the context of this judgment, what is the difference between res judicata and the principle against vexatious litigation (nemo debet bis vexari)?
a) Res judicata requires a decision on merits, whereas the broader principle may apply even without a merits decision if a party had the opportunity to litigate and chose not to.
b) There is no difference; they are identical.
c) Res judicata applies only to criminal proceedings.
d) The broader principle is codified in Section 11 CPC.