Plea inconsistent with pleadings cannot be raised later; securities transaction challenge on public policy failed.

A litigant cannot introduce a new, inconsistent defence at the appellate stage by amendment or additional evidence when the written statement was confined to squaring up and repayment. The Court held that a plea that securities transactions were void as against public policy could not be entertained because it contradicted the pleaded case and had not been raised before the trial forum. The record also showed no material that the transactions were fictitious, derived-price transactions, or otherwise illegal, and the RBI circulars relied on did not make them void against the respondent. The findings that the transactions were not squared up or repaid were therefore upheld.

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Issues: Whether the appellant could be permitted to raise, by amendment and additional evidence, a new plea that the securities transactions were void as opposed to public policy, and whether the decree could be disturbed on the plea that the transactions had been squared up or repaid.

Analysis: The appellant's case in the written statement was confined to squaring up and repayment. The proposed plea of illegality and public policy was inconsistent with that defence and had not been pleaded before the Special Court. A party cannot be allowed to build up a new case by evidence that is contrary to the pleadings, especially after electing not to seek amendment at the trial stage. The record also disclosed no material to establish that the securities transactions were fictitious, derived-price transactions, or otherwise illegal. The RBI circulars relied upon did not render the transactions void as against the respondent, and there was no basis to reopen the factual findings on squaring up or repayment.

Conclusion: The plea based on public policy was rightly rejected, the request to amend and adduce additional evidence was not entertainable, and the findings that the transactions were not squared up or repaid were upheld.

Final Conclusion: The decree in favour of the respondent was affirmed and the appeal failed.

Ratio Decidendi: A litigant cannot be permitted to advance a new and inconsistent defence contrary to its pleadings by seeking amendment or additional evidence at the appellate stage, and a commercial securities transaction is not shown to be void on public policy unless illegality in its object or consideration is established.

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