1. This application is directed against the order of the learned Munsif, First Court, Monghyr, staying Money Suit No. 38 of 1969 pending in his court till the disposal of Original Suit No. 662 of 1968 pending in the court of the District Munsif at Vijayawada. The learned Munsiff has passed such an order of stay under Section 10 of the CPC (hereinafter to be referred to as the “Code”). The circumstances under which the impugned order came to be passed are as follows:—. Some time in the last week of August, 1968, an agent of the defendants, which are a partnership firm having their Head Office at Vijayawada, negotiated with the plaintiffs, which also are a partnership firm having their Head Office at Khagaria, for sale of cocoanuts. The plaintiffs booked an order for coconuts to be supplied by the defendants, and, in pursuance of this agreement, the plaintiffs made advance payments to the defendants in two equal instalments, one by a bank draft, dated the 9th September, 1968, and the other by a telegraphic transfer, dated 14th September, 1968. The defendants dispatched two wagons of cocoanuts for delivery to the plaintiffs at Barauni on the basis of relative railway receipts which were forwarded to the plaintiffs through the State Bank of India. The first consignment was received on the 25th September, 1968, and it was duly honoured by the plaintiffs. In regard to the second consignment, a notice of the arrival of the railway receipt, together with the usual hundi, was given to the plaintiffs on the 8th October, 1968. But the delivery of the consignment was not taken by the plaintiffs as they were not prepared to honour the hundi on a ground which according to the plaintiffs was that the defendants had not, in accordance with the terms of the agreement between the parties, adjusted the advance of Rs. 1,000/- against the money payable by the plaintiffs at the time of taking delivery of the second consignment According to the plaintiffs, the defendants were actuated with dishonesty from the very inception and so they did not deliberately adjust the advance towards the hundi drawn by them upon the plaintiffs for being honoured at the time of taking delivery of the second consignment. In other words, according to the plaintiffs, the fault lay with the defendants and, by reason of their default, the plaintiffs not only lost the business of dealing in cocoanuts on the occasion of the Chhath festival of that year, but also sustained loss of profits. Accordingly, the plaintiffs instituted the money suit in the first court of the Munsif at Monghyr for recovery of a sum of Rs. 1,000/- paid by them to the defendants by way of advance and a further sum of Rs. 500/- as compensation for loss of profits to them.
2. The defendants appeared in the suit and filed a written statement denying their liability to the plaintiffs. The substantial defence taken by the defendants is that, in the circumstances mentioned in the written statement, the plaintiffs had no justification for refusing to honour the hundi and to take delivery of the second consignment of cocoanuts which had been despatched by the defendants as per the agreement between the parties. The defendants further pleaded that, although they had not given credit to the plaintiffs in respect of the advance of Rs. 1,000/- in the first instance, yet they had telegraphically informed then bankers at Khagaria to deliver the bill and the hundi to the plaintiffs on receiving from them a sum of Rs. 1,000/- less than the billed amount Notwithstanding each action taken by the defendants, the plaintiffs had deliberately failed to honour the hundi and to take delivery of the consignment. Therefore, it became necessary for the defendants to arrange to take delivery of the consignment and to sell the cocoa-nuts through their own agency. In that process, it is said that the defendants suffered a total loss of Rs. 3,265.87 paise, out of which the plaintiffs were entitled to a credit to the extent of Rs. 1,000/-, which was the advance money; but the balance of Rupees 2,265.87 paise was recoverable by the defendants from the plaintiffs, and, for that purpose, the defendants had instituted original suit No. 662 of 1968 in the court of the District Munsif at Vijayawada. A certified copy of the plaint of the Vijayawada suit has been filed by the plaintiffs in the present suit.
3. After filing their written statement on the lines indicated above, the defendants put in a petition before the learned Munsif under Sections 10 and 151 of the Code praying that, as the matter in issue in the Monghyr suit was substantially the same as in the Vajayawada suit and as the parties to both the suits were the same and were litigating for the breach of the name contract the trial of the Monghyr suit should be stayed until the disposal of the Vijayawada suit in order to avoid conflict in judgments and multiplicity of proceedings.
4. The defendants' prayer for stay of the Monghyr suit was resisted on behalf of the plaintiffs. But, by the impugned order, which was passed on the 24th February, 1970, the learned Munsif has directed that the suit pending in his court should be stayed till the disposal of the suit pending in the court of the District Munsif at Vijayawada.
5. On behalf of the petitioners the order of stay thus passed by the learned Munsif is challenged on the ground that the requirements of Section 10 of the Code have not been fulfilled so that the learned Munsif had no jurisdiction to stay the Monghyr suit until the disposal of the Vijayawada suit. It is argued that the issues in the two suits are not identical nor are the Beliefs which the two parties claim against each other. It is further argued that in the Monghyr suit the questions to be decided would be whether the defendants had or had not agreed to make an adjustment of the advance of Rs. 1,000/- in the hundi relating to the second consignment, and whether the defendants had wrongfully omitted to give such an adjustment so as to justify the refusal of the plaintiffs to honour the second consignment. On the other hand, the main question to be decided in the Vijayawada suit would be whether the plaintiffs had deliverately refused to honour the hundi and to take delivery of the second consignment.
6. Several decisions were cited by learned counsel for the petitioners in support of his contention. The decisions referred to were Jugometal Trg. Republike v. Rungta and Sons (Pvt.) Ltd., AIR 1966 Cal 382 at page 385, Bhagwat Prashad Singh v. Sudheshwar Singh, AIR 1954 Pat 11 and Prabir Ram Borooah v. Albert David Ltd., AIR 1957 Assam 120. As against these, Mr. Joshi, on the other side, has relied upon a Bench decision of the Bombay High Court in Jai Hind Iron Mart v. Tulsiram Bhagwandas, AIR 1953 Bom 117. I do not propose to deal with these cases because, while they are undoubtedly instructive, they do no more than illustrate the true scope of Section 10 of the Code. In my opinion, therefore, it will be more profitable to examine the requirements of Section 10, the provisions of which are really not in doubt Under this section, the Court is prohibited from proceeding with the trial of a suit where two conditions exist, namely, (i) where there is a previously instituted suit between the same parties, and (ii) where the matter directly and substantially in issue in both the suits is the same. The first of these requirements of Section 10 can present no difficulty, and, for determining whether the second one exists or not, the Court has to direct its attention to the pleadings of both the suits and to determine what is the matter directly and substantially in issue in the two suits. Having ascertained this, the Court has further to consider whether or not the matter directly and substantially in issue in both the suits is the same. The test to be applied for this purpose is not whether the cause of action or the reliefs claimed in both the suits are the same, nor whether one of the issues arising in both of them is the same. The test is whether the decision of the matter directly and substantially arising in the former suit will decide not merely that suit, but will also operate as res judicata in the subsequent suit between the same parties. It will be noticed that the expression directly and substantially in issue, which has been employed in Section 10, is also to be found in Section 11 of the Code. While Section 10 relates to res sub-judice, that is, a matter which is pending a judicial adjudication, Section 11 relates to res judicata, that is to say, a matter already adjudicated upon by a competent Court Whereas Section 10 bars the trial of a suit in which the matter directly and substantially in issue is pending adjudication in a previous suit, Section 11 bars the trial of a suit or an issue in which the matter directly and substantially in issue has already been adjudicated upon in a former suit. The object of both the sections is similar, namely, to protect the parties from being vexed twice for the trial of the same cause and to achieve the public policy that there should be an end of litigation. Therefore, one of the objects of Section 10 is to prevent competent Courts of concurrent jurisdiction from having to try parallel suits in respect of the same matter in issue, and thereby to pave the way for the application of the rule of res judicata contained in the next following section. So, what the Court has really to see is if the decision of the matter directly and substantially in issue in the former suit will or will not lead to the decision of the matter directly and substantially in issue in the subsequent suit; and if it is satisfied that it will, then it must stay the trial of the subsequent suit and await the decision in the former suit.
7. In the light of the above principles, we have to examine the pleadings of the two suits in the instant case. Upon such examination, it is manifest that the question directly and substantially in issue in both the suits is the same. In the Vijayawada suit, that question is whether the present plaintiffs were justified in declining to honour the second hundi and to take delivery of the second consignment, or it was a mere pretext. If the Vijayawada Court comes to the conclusion that the present plaintiffs were justified in not taking delivery of the second consignment, then that suit will fail, and, since the same question will also arise in the Monghyr suit it must follow that on the same ground, the Monghyr suit will succeed. On the other hand, if the decision in the former suit is that the present plaintiff had no justification to define to honour the second hundi and to take delivery of the second consignment; then not only the Vijayawada suit will succeed, but on the basis of the same decision, the Monghyr suit will fail. Thus, in my judgment the Instant case falls well within the ambit of Section 10 of the Code.
8. In this connection I may point out that, in paragraph 4 of the impugned order, the learned Munsif has observed that there was no dispute between the parties before him that the matter in issue in both the suits is substantially the same. The plaintiffs, however, took the stand that the Vijayawada suit was intended merely to forestall the Monghyr suit and it was thus an abuse of the process of the Court so that the Monghyr Court was not bound to pass an order of day in terms of Section 10 of the Code. But the learned Munsif was not satisfied that the Vijayawada suit was designed to forestall the Monghyr suit on to steal a march over the present plaintiffs. Upon inch finding, there can be no valid justification for declining to pass an order as required by Section 10. For the aforesaid reasons, I am of the opinion that no ground has been made out for interfering with the impugned order. This application is, accordingly, die-missed, but without costs.
9. Application dismissed.