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Issues: (i) whether a plaintiff can, at the appellate stage, withdraw or treat the suit as not pressed so as to nullify a decree already passed by the trial court and affect rights that have vested under that decree; (ii) whether transferees who have been impleaded in appeal under the transfer pendente lite and whose rights are affected by the withdrawal application are entitled to be heard.
Issue (i): Whether a plaintiff can, at the appellate stage, withdraw or treat the suit as not pressed so as to nullify a decree already passed by the trial court and affect rights that have vested under that decree.
Analysis: Order 23 Rule 1 permits withdrawal or abandonment of a suit, but the rule cannot be applied mechanically after a decree has been passed and challenged in appeal. A decree conclusively determines the rights of the parties, and once rights have crystallised under it, they cannot ordinarily be destroyed by a unilateral withdrawal at the appellate stage. The Court followed the settled view of several High Courts that withdrawal at that stage may be refused where it would prejudice vested or substantive rights created by the decree, and distinguished the case where withdrawal is sought before any decree comes into existence.
Conclusion: The plaintiff could not be permitted to withdraw the suit at the appellate stage so as to destroy the decree and divest rights that had already accrued under it.
Issue (ii): Whether transferees who have been impleaded in appeal under the transfer pendente lite and whose rights are affected by the withdrawal application are entitled to be heard.
Analysis: Once the property had been transferred after the decree and the transferees had been impleaded in appeal, they were materially affected by any order permitting withdrawal. Their position was treated as sufficiently direct to attract the Court's consideration of their accrued interest, and the Court declined to ignore the effect of the transfer and impleadment merely because the original plaintiff wished to compromise or withdraw. The transferees therefore had a right to oppose withdrawal in the appellate proceedings.
Conclusion: The transferees were entitled to be heard, and the withdrawal application could not be allowed to defeat their interest.
Final Conclusion: The appeal succeeded, the High Court's order permitting withdrawal was set aside, the withdrawal application was rejected, and the matter was restored for decision on merits.
Ratio Decidendi: A suit that has already culminated in a decree under challenge in appeal cannot ordinarily be withdrawn unconditionally so as to nullify that decree and defeat vested rights created under it, particularly where transferees affected by the decree have been impleaded and are entitled to be heard.
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