Res judicata bars reopening a contractual interest dispute once the issue was finally decided between the same parties.

A matter directly and substantially in issue between the same parties, once heard and finally decided, cannot be reopened on the ground that the earlier reasoning was erroneous in law or fact. The prior determination that the tenant was bound by the kabuliyat to pay interest on arrears of rent therefore operated as res judicata. The contractual interest remained binding, and it was also required to be included as an incident of the rent dispute when computing the suit value for the statutory bar to second appeal. The objection to maintainability failed, and the trial court decree was restored with costs.

---

---

Issues: Whether the prior decision between the parties conclusively determined the liability to pay interest at the contractual rate on arrears of rent, so as to operate as res judicata in the present suit; and whether such contractual interest could be excluded from the computation of the amount claimed in the suit for the purpose of the statutory bar to second appeal.

Analysis: The matter directly and substantially in issue in the earlier suit was the same concrete question as in the present suit, namely, whether the tenant was bound by the kabuliyat to pay interest at 75 per cent per annum on arrears of rent. That question had been heard and finally decided against the tenant in the earlier litigation, and the correctness of that decision did not matter once the statutory requirements of res judicata were satisfied. The reasoning of the earlier judgment was not the test; what mattered was that the very issue of the binding character of the stipulation had already been determined between the same parties. The contractual interest claim was also an incident of the rent dispute and had to be taken into account for deciding the statutory value of the suit.

Conclusion: The prior decision operated as res judicata, the contractual stipulation for interest remained binding, and the objection to the maintainability of the second appeal failed.

Final Conclusion: The second appeal succeeded, the appellate decree was set aside, and the decree of the trial court was restored with costs.

Ratio Decidendi: A matter once directly and substantially in issue between the same parties, and heard and finally decided, cannot be reopened merely because the earlier decision is said to be erroneous on law or fact; the conclusive effect attaches to the decision itself, not to the correctness of its reasoning.

---