JUDGMENT
B.L. Narasimham,C.J.
1. This is an appeal by the plaintiff against the decision of the Additional Subordinate Judge of Cut-tack dismissing his suit for recovery of a sum of Rs. 6000/- from the respondent on the basis of a decree given by the Second Judge of Rangoon (Ext. 2) in Suit No. 1276 of 1951, between the same parties.
2. The learned Judge of the Rangoon Court decreed the plaintiff’s claim for Rs. 4318/8/0 on 9-6-52 and the plaintiff after adding interest at 6 per cent per annum, filed the suit under appeal. The suit is thus based on a foreign judgment.
3. The learned lower court, relying on Division Bench decision of this Court reported in Chintamoni Padhan v. Paik Samal, AIR 1956 Orissa 136 held that the foreign judgment was not given on the merits of the case and that consequently Section 13(b) of the Civil Procedure Code would not apply. He further held that the decree of the Rangoon Court could not be executed here because, at the time of the institution of the suit, Burma was not a ‘reciprocating territory’ within the meaning of Section 44A of the Civil Procedure Code.
4. The judgment of the Rangoon Court may be quoted in full:
“Civil Regular Suit No. 1276 of 1951.
Dated Rangoon the 9th June 1952.
T. Choudhury ….. Dayanidhi Patra.
Before :- U. Shwe B.A., B.L. 2nd Judge
of the Court.
* * * *
JUDGMENT:
The plaintiff claims Rs. 4318/8/0 from the defendant for price of goods sold and delivered. The defendant filed written statement saying that some of the goods sold were returned to the plaintiff as being unfit and unserviceable and that he had paid Rs. 1702-12-0 as the price of goods and further questioned the correctness of the value of goods claimed.
He fails to put in his appearance on the day fixed for hearing and his lawyer Mr. Chaube withdraws his power for want of some instruction.
The suit therefore proceeds ex parte. The points raised by the defendant have to be proved by the defendant except for value of the goods supplied. Plaintiff has given evidence that the value of the goods supplied was fixed at the time of the purchase, and that no articles had been returned to him and no payment has been made for the goods.
There is, therefore, a prima facie case for him. The suit is accordingly decreed in the sum of Rs. 4318-8-0 with costs and interest at court rate, from the date of suit till date of relisation. Sd. Shwe Bin, Second Judge, 9-6-52."
Before the Rangoon Court, though the defendant filed a written statement raising several objections he failed to appear on the date fixed and allowed the suit to be decreed ex parte. But before passing, an ex parte decree the learned Judge took the evidence of the plaintiff and then held that the claim, was proved. He also over-ruled the objections raised by the defendant in his written statement against the claim of the plaintiff. It is true that ultimately he held that there was a “prima facie case” for the plaintiff. Here the expression “prima facie” merely indicates that it is an ex parte judgment inasmuch as, due to the default of the defendant, the plaintiff was not cross-examined, nor was any evidence adduced on behalf of the defendant.
5. On the atoresaid facts, the main question for consideration is whether the foreign judgment can be said not to have been given on the “merits of the case”–for the purpose of Section 13(b) of the Civil. Procedure Code.
6. The leading decision on the aforesaid section is that reported in D.T. Keymer v. Viswanathan Reddi, AIR 1916 PC 121. In that case the defendant’s defence was struck out as he failed to answer the interrogatories and the plaintiff’s claim was decreed by the foreign court. The plaintiff was not examined as a witness, nor did the Court give any reason for holding that the plaintiff’s claim was proved. It was therefore held by the Privy Council that the judgment was not given on the merits of the case.
7. In innumerable subsequent decisions given by the High Courts in India the question as to whether an ex parte judgment passed by a foreign court will, under all circumstances be deemed to have- been given not on the merits of the case, has been fully discussed and the High Courts are unanimous that even an ex parte judgment may be held to be given on the merits of the case, if some evidence has been led and the judgment was given on the basis of that evidence.
Thus in Meher Singh v. Ishar Singh, AIR 1932 Lah 649 it was pointed out that the test for deciding whether a judgment was given on the merits of the case was whether it was given merely as a penalty for any conduct of the defendant, or whether it was based on a consideration of the truth or otherwise of the plaintiff’s case. The Privy Council case was explained on the footing that, there, there was uo consideration of the truth or otherwise of the plaintiff’s case. The same view has been followed in Dr. Kulwant v. Dhan Raj Dutt, AIR 1935 Lah 396.
The Allahabad High Court also, in Ishri Prasad v. Sri Ram, AIR 1927 Allahabad 510 laid down-the same principle by saying that the expression “merits of the case” used in Section 13(b) Civil Procedure Code was used in contradistinction to a judgment by way of penalty. The Bombay High Court also adopted the same view in Vithal Bhai Shiva-bha v. Lal Bhai Bhimbhai, AIR 1942 Bom 199. In that case, though the defendant was absent, the plaintiff’s evidence was taken and alter considering the same, together with the documents, the Court decreed the plaintiffs claim.
It was held that the decision was given on the merits of the case. Similarly, in Abdul Bahim v. Mohd. Din, AIR 1943 Cal 42 it was pointed out that where the plaintiff’s suit was decreed on a date when the defendants, for their own purposes, were not present at the hearing and not represented, the decision of the foreign court was, nevertheless, a decision given on the merits of the case. Again in Mohd. Kassim and Co. v. Seeni Fakir, AIR 1927 Mad 265 a Full Bench of the Madras High Court considered this question, and held, following AIR 1916 PC 121 that where no evidence was given on the side of the plaintiff but his claim was decreed merely because the defendant was absent, the decision was not given on the merits of the case.
In Jayam Sunder Raja Ratnam v. Muthuswami, AIR 1958 Mad 203 it was held that even an ex parte judgment of a “foreign court” if based on a consideration of the evidence adduced in that case by the plaintiff, must be deemed to have been given on the merits of the case. Then again in Sundaram Pillai v. Kandaswami Pillai, AIR 1941 Mad 387 it was held that where due to the absence of the defendant the examination of the plaintiff was formal and brief and he was not subjected to any cross-examination, but yet, the plaintiffs suit was decreed on a consideration of his evidence, the judgment was nonetheless a judgment on the merits of the case.
In Wazir Sahu v. Munshi Das, AIR 1941 Pat 109 the same view was adopted. In a recent Kerala case reported in Govindan v. Sankaran, AIR 1958 Kerala 203 the same principle was followed though in that case it was held that the judgment was not given on the merits of the case because the decree in favour of the plaintiff was given merely on the ground of default of appearance of the defendant and there was not even a formal consideration of the truth or otherwise of the plaintiff’s claim and no evidence was adduced on his behalf.
8. Thus, there seems to be complete unanimity of all the High Courts (with the exception of AIR 1956 Orissa 136) that even an ex parte judgment in favour of the plaintiff may be deemed to be a judgment given on the merits of the case if some evidence is adduced on behalf of plaintiff and the judgment–however brief — is based on a consideration of that evidence. Where however no evidence is adduced on the plaintiffs side and his suit is decreect merely because of the absence of the defendant either by way of penalty or in a formal manner, the principle laid down in “the Privy Council decision reported in AIR 1916 PC 121 would apply and the judgment may not be one based on the merits of the case.
9. In the instant case however, the foreign judgment clearly shows that the plaintiff gave evidence before the Court. The learned Judge of Rangoon also gave his reasons for accepting the plaintiffs claim and rejecting the defendant’s contention. It must therefore be held to have been given on the merits of the case and would be conclusive between the parties under Section 13(b) of the Civil Procedure Code.
10. Mr. D.C. Sahu for the respondent urged that an earlier Division Bench of this Court has already held in AIR 1956 Orissa 136 that unless a judgment is given after contest and alter evidence had been let in by both sides, such a judgment could not be deemed to have been given on the merits of the case within the meaning of Section 13(b), Civil Procedure Code, and that we are bound to follow that decision. The aforesaid view taken in AIR 1956 Orissa 136 seems to run counter to the decisions of almost all the High Courts in India.
Though the learned Judges who decided that case stated that they were following AIR 1927 Mad 265, it is obvious that they failed to notice the distinguishing features of the Madras case and the Orissa case. aS already pointed out, in the Madras case the foreign judgment was given without taking any evidence and without any trial; whereas in the Orissa case though the foreign judgment was given ex parte, the plaintiff’s evidence was taken. Apart from overlooking this distinguishing feature the learned Judge relied on the observations of Venkatasubba Rao J. in the aforesaid Madras case.
But Venkatasulbba Rao J. was one of the Judges who referred the case to the Full Bench and he was not a member of the Full Bench which finally decided the matter. His observations cannot be taken to have been endorsed by the Full Bench and cannot be taken as an authority for the view adopted by the learned Judges of Orissa High Court in AIR 1956 Orissa 136.
11. If the aforesaid observations of the Division Bench in AIR 1956 Orissa 136 were really necessary for the decision of that case, I would have referred this question to a larger Bench so that the correctness of that decision may be re-examined; for, as observed by their Lordships of the Supreme Court in Mahadeolal v. Administrator-General West Bengal, AIR 1960 SC 936 and in Jai Kaur v. Sher Singh, AIR 1960 SC 1118 it would not be proper for a later Division Bench to differ from a previous Division Bench of the same High Court on the same point.
But after a careful perusal of the “judgment in AIR 1956 Orissa 136 I am satisfied that the observations made therein were only in the nature of obiter. As pointed out in Sital Chandra v. Heirs of Mihilal Kolley AIR 1955 Cal 21 the obiter of a previous Division Bench, though entitled to utmost consideration by a subsequent Bench of the same Court, would not be binding unless fundamentally based on sound principles.
12. In the Orissa case the facts were as follows. The Ruler of Dhenkanal purported to resume the lands of some of his tenants in 1932 and resettled the same with new tenants and also granted mutation pattas to them. The new tenants filed a suit in the Court of the District Judge in O. S. 37 of 1938-39 for recovery of possession from the old tenants who were impleaded as defendants, relying mainly on the mutation pattas granted to them. The suit was decreed ex parte in their favour and the learned Judge observed that the mutation pattas filed by the plaintiffs was proof of their title.
Subsequently, however, the very same Judge, as Mutation Officer, reported to the Ruler that the validity of the resumption of the lands was not tree from ambiguity and that the old tenants might succeed in getting their holding, or most part of it, restored; but observed that they should seek redress in the competent Civil Court. This report of the Mutation Officer’ was accepted by the Chief Minister of the State, and the old tenants were permitted to bring a fresh civil suit.
The second civil suit was brought in 1945 in the Court of the Munsif of Dhenkanal. There the previous ex parte decision in O. S. No. 37 of 1938-39 was pleaded as barring the second suit on the principle of res judicata. The learned Judges of the Orissa High Court negatived this contention holding that in the first judgment the validity or otherwise of the resumption proceedings started in 1932 was not decided and that consequently the earlier judgment would not operate as res judicata or even as constructive res judicata, under explanation IV to Section 11 of the Civil Procedure Code.
Having thus disposed of the matter the learned Judges further examined the question as to whether the previous judgment could be said to have been given on the merits of the case within the meaning of Section 13(b) of the Code. They first held the previous judgment to be a foreign judgment because it was only after 1-1-48 that Dhenkanal State merged with the Indian Dominion. Then they held that the ex parte Judgment in O. S. No. 37 of 1938-39 was not given on the merits of the case as the evidence of the defendant was not taken and the suit was not contested.
This latter observation was clearly in the nature of obiter. The learned Judges had in the earlier portion of their judgment held that the previous judgment in O. S. No. 37 of 1938-39 could not operate as res judicata because the question of the validity of the resumption proceeding was not raised or decided in that case. On the other hand the Mutation Officer’s order left this question open to be decided by the Civil Court. After having thus disposed of the question of res judicata, it was not necessary for the Judges to go into the question as to whether it was a foreign judgment and whether Section 13(b) of the Civil Procedure Code would apply. Any observations on this question would be obiter as they were not necessary for the decision of the case and hence they are not binding on this Court.
13. As regards the correctness of the principle laid down in the aforesaid Division Bench decision, I have already shown that it is opposed to the unanimous view taken by all the High Courts, that even an ex parte judgment may be held to be a judgment given on the merits of the case if some evidence is taken and the judgment is based on that evidence. With great respect therefore we are unable to agree with the somewhat wide observations made in AIR 1956 Orissa 136, on this question.
14. For the aforesaid reasons, I would hold that the Rangoon judgment was given on the merits of the case and it is conclusive between the parties. The plaintiff’s suit is decreed with costs throughout and future interest at 6 per cent per annum.
15. The appeal is allowed with costs,
R.K. Das, J.
16. I agree.