The Supreme Court of India, through a Bench comprising Justice B.V. Nagarathna and Justice R. Mahadevan, has ruled that when a High Court sets aside an order rejecting a plaint and restores the suit to the file of the Trial Court, it implies that the suit must be decided in accordance with law on all issues. The Apex Court clarified that such restoration mandates the adjudication of all raised objections, including limitation, res judicata, and bars under Order II Rule 2 of the Code of Civil Procedure (CPC), alongside the merits of the case.
The primary legal question before the Supreme Court was whether the High Court of Karnataka erred in setting aside the Trial Court’s order which had rejected the plaint under Order VII Rule 11 (a) and (d) of the CPC. The Trial Court had initially allowed the defendants’ application for rejection, but the High Court reversed this, restoring the suit.
Dismissing the appeal filed by C.M. Meenakshi, the Bench of Justice Nagarathna and Justice Mahadevan upheld the High Court’s decision. The Court laid to rest the apprehensions that the restoration of the suit might preclude the Trial Court from considering preliminary objections, affirming that all issues remain open for adjudication during the trial.
Background of the Case
The litigation stems from Original Suit No. 26246 of 2023, instituted by the respondents-plaintiffs (Archbishop of Bangalore & Others) concerning a property measuring 1 Acre 04 Guntas at Bilekahalli Village, Bangalore South Taluk. The plaintiffs sought:
- A declaration of absolute ownership of the Suit Schedule Property.
- A declaration that the judgment and decree in O.S. No. 26051/2014 are not binding on them.
- A declaration that sale deeds dated March 15, 2014, and November 13, 2020, are null and void.
- Permanent injunctions against the defendants regarding alienation and structural changes to the property.
During the proceedings, the defendants moved an application (I.A. No. 3) under Order VII Rule 11 (a) and (d) read with Section 151 of the CPC. On March 15, 2024, the 73rd Additional City Civil and Sessions Judge, Mayo Hall Unit, Bengaluru, allowed this application, rejecting the plaint on the grounds that it was barred by law and disclosed no cause of action.
The plaintiffs challenged this rejection in Regular First Appeal No. 683 of 2024. On June 27, 2024, the Karnataka High Court allowed the appeal, setting aside the rejection order and restoring the suit. The appellant then moved the Supreme Court against this restoration.
Arguments of the Parties
Arguments for the Appellant: Learned Senior Counsel Sri Anand Grover, representing the appellant, argued that the High Court’s restoration of the suit was erroneous. He submitted:
- No Cause of Action: The plaint failed to disclose a valid cause of action.
- Limitation Bar: The reliefs claimed were “hit by the law of limitation.”
- Res Judicata: Citing four previous suits filed by the respondents-plaintiffs that were either dismissed or withdrawn, the counsel argued the present suit was not maintainable due to the “application of the principle of res judicata.”
- Order II Rule 2 CPC: The counsel contended that the reliefs sought should have been included in earlier plaints, thus barring the current suit under Order II Rule 2 of the CPC.
Arguments for the Respondents: Learned Senior Counsel for the respondents-plaintiffs defended the High Court’s order, submitting:
- Issues for Trial: Even if contentions regarding limitation and res judicata existed, they were “all matter of trial” and not grounds for threshold rejection.
- Incorrect Dismissal: The Trial Court had erred in allowing the application “at the threshold thereby resulting in dismissal of the suit.”
- High Court’s Reasoning: The High Court had correctly analyzed the scope of Order VII Rule 11 and rightfully restored the suit.
Counsel for Respondent No. 11/Defendant No. 11 voiced a specific apprehension that the Trial Court might interpret the High Court’s order as a directive to ignore the issues of limitation and res judicata.
Court’s Analysis
The Supreme Court addressed the specific concern regarding the scope of the trial post-restoration. Justice B.V. Nagarathna, authoring the judgment on behalf of the Bench, clarified that the High Court’s order did not imply that procedural bars should be ignored.
The Court observed:
“We do not think that this is an implication of the judgment of the High Court, nor can such a construction be given to its observations. All that the High Court meant was that the suit is restored on the file of the Trial Court and that it has to be decided in accordance with law, which would include all the above issues apart from the issues on the merits of the case.”
The Bench cited the following precedents to support its view on how such issues should be handled:
- Srihari Hanumandas Totala vs. Hemant Vithal Kamat, (2021) 9 SCC 99
- Shakti Bhog Food Industries Ltd. vs. Central Bank of India, (2020) 17 SCC 260
Decision
The Supreme Court dismissed the appeal and affirmed the restoration of O.S. No. 26246 of 2023.
In its concluding directions, Justice Nagarathna stated:
“It is needless to observe that with the cooperation of both sides, the Trial Court shall endeavour to expedite the disposal of the suit.”
The appeal was dismissed with parties bearing their respective costs, and all pending applications were disposed of.
