Constructive res judicata bars writ challenge to a foreign exchange issue already decided in suit and appeal.

A writ petition under Article 226 could not be used to reopen a foreign exchange compliance issue that had already been framed in the civil suit, decided on merits, and examined again in appeal. The courts had found that the transaction fell within the RBI's general permission and complied with the FERA framework, giving the issue finality. The same controversy was therefore barred from fresh challenge by constructive res judicata and the principle of finality of adjudication. A party's failure to effectively contest the issue in the proper forum did not create a later right to re-agitate it in writ proceedings.

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Issues: Whether the writ petition could be maintained to reopen an issue already adjudicated in the civil suit and the related appeals, or whether such challenge was barred by finality and constructive res judicata.

Analysis: The dispute regarding compliance with the foreign exchange regime and the effect of the RBI permission had already been framed as an additional issue in the civil proceedings and was decided on merits. The resulting decree was carried in appeal, and the appellate court also examined the same issue and recorded findings that the transaction fell within the general permission under the RBI notification and complied with the statutory framework under FERA. In these circumstances, the same controversy could not be re-agitated in writ proceedings under Article 226 of the Constitution of India. The Court also held that failure to effectively contest the issue in the proper forum did not create a fresh right to reopen it later.

Conclusion: The writ challenge was not maintainable to the extent it sought reopening of an issue already finally decided, and the appeal was liable to be dismissed.

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