Supreme Court overturns High Court decision citing res judicata, clarifies Civil Court jurisdiction post-amendment.

The Supreme Court allowed the appeal, overturning the High Court's decision on the grounds of res judicata and constructive res judicata. It held that the issues were not conclusively settled in the previous suit and that the causes of action in the two suits were distinct. Regarding the jurisdiction of the Civil Court post the Fifth Amendment of the Goa, Daman & Diu Agricultural Tenancy Act, 1964, the Supreme Court clarified that the Civil Court had jurisdiction until the amendment came into effect. The matter was remitted to the Trial Court for further proceedings based on the Court's observations.

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Issues Involved:
1. Res Judicata
2. Constructive Res Judicata (Order 2 Rule 2(3) CPC)
3. Jurisdiction of Civil Court post Fifth Amendment of the Goa, Daman & Diu Agricultural Tenancy Act, 1964

Summary:

1. Res Judicata:
The High Court dismissed the suit on the ground of res judicata, asserting that the subject matter of the second suit was directly and substantially in issue in the previous suit between the same parties. The Supreme Court found this conclusion difficult to sustain. The first suit was dismissed on a technical ground that a suit for a mere declaration without seeking consequential relief of possession could not lie. The issue regarding the plaintiff's status as a lessee was not settled in the first suit and hence could not be barred by res judicata in the subsequent suit brought by the lessee for possession of the demised property.

2. Constructive Res Judicata (Order 2 Rule 2(3) CPC):
The High Court also held that the suit was barred by Order 2 Rule 2(3) of the Code of Civil Procedure, which requires a plaintiff to include the whole of his claim in the framing of the suit. The Supreme Court disagreed, noting that the first suit was for an injunction, not for possession, and was dismissed on the technical ground that the plaintiff was not in de facto possession. The cause of action for the second suit was distinct, based on the allegation of forcible dispossession, and hence not barred by Order 2 Rule 2(3) CPC.

3. Jurisdiction of Civil Court post Fifth Amendment of the Goa, Daman & Diu Agricultural Tenancy Act, 1964:
The High Court concluded that the Fifth Amendment, which came into force during the pendency of the suit, ousted the jurisdiction of the Civil Court. The Supreme Court examined whether the amendment applied retrospectively to pending litigation. It held that the Civil Court had jurisdiction under section 9 CPC until the Fifth Amendment became effective. Post-amendment, questions of tenancy had to be decided by the Mamlatdar, and the Civil Court's jurisdiction was ousted by section 58(2) of the Act. The Supreme Court suggested that the proper course would be to refer the issue of tenancy to the Mamlatdar and proceed based on his decision.

Conclusion:
The Supreme Court allowed the appeal, set aside the High Court's order, and remitted the matter to the Trial Court to follow the appropriate procedure in light of the observations made. The Trial Court was directed to determine the course of action based on the pleadings and nature of the questions required for the grant or refusal of relief claimed in the suit. No order as to costs was made.

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