Page 1

1

NON-REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION  

SPECIAL     LEAVE     PETITION     (Civil)     No.     490     of     2012   

Khoday Distilleries Ltd. & Ors. .. Petitioners

Versus

Mahadeshwara S.S.K. LTD. .. Respondent

O     R     D     E     R   

1.  This special leave petition has been filed against the order of  

the High Court of Karnataka at Bangalore dated 9.9.2011 in RP  

No.96/2011 in RFA No.427 of 2006.  On 20.1.2012 notice was  

issued on the special leave petition as well as on the prayer of  

interim relief. The respondent entered appearance and filed a  

detailed counter affidavit and raised a preliminary objection about  

the maintainability of the special leave petition.   

2. Shri Rajesh Mahale, learned counsel appearing for the  

respondent submitted that the petitioner had earlier challenged the  

judgment and order dated 12.11.2008 in RFA No.427 of 2006

Page 2

2

before this Court.  The same came up for hearing before this Court  

on 4.12.2009 and the respondent entered appearance and opposed  

the petition.  This Court, while condoning the delay in filing SLP,  

dismissed the SLP on the same day.  Later the petitioners filed  

Review Petition NO.96 of 2011 for reviewing the Judgment dated  

12.11.2008 in RFA No.427 of 2006 before the High Court of  

Karnataka at Bangalore.  Review petition was dismissed by the High  

Court by the impugned order dated 9.9.2011.  Learned counsel  

placed considerable reliance on the three Judge Bench Judgment of  

this Court in Abbai Maligai Partnership Firm and another v. K.  

Santhakumaran and others (1998) 7 SCC 386 and contended  

that decision would squarely apply to the facts of this case and the  

High Court has rightly dismissed the review petition by holding that  

when the Judgment and decree passed by the High Court was  

confirmed by the Supreme Court by dismissing the SLP, there was  

no question of entertaining the review petition.

3. Mr. Gopal Jain, learned counsel appearing for the petitioners  

submitted that the High Court has committed an error in  

dismissing the review petition since the earlier SLP was dismissed

Page 3

3

by this Court on 4.12.2009 without stating any reason. Reliance  

was placed on a three Judge Bench Judgment of this Court in  

Kunhay Ammed and others v. State of Kerala and another  

(2000) 6 SCC 359.  Learned counsel pointed out that since the SLP  

was dismissed at the admission stage by a non-speaking order it  

would not constitute res-judicata and does not culminate in merger  

of the impugned judgment and the High Court has committed a  

grave error in dismissing the review petition.

4. We notice that large number of review petitions are being filed  

by the parties even after dismissal of the SLPs by this Court, either  

by non-speaking orders or on merits, and depending upon the out-

come of the review petitions again SLPs are being filed before this  

Court and  both sides place reliance on the reasoning of the three  

Judge Bench Judgment in Abbai Maligai Partnership Firm and  

another (supra) or Kunhay Ammed and others (supra), in respect  

of their rival contentions on maintainability.

5. We notice applying the ratio of the Judgments in Abbai  

Maligai Partnership Firm and another (supra) or Kunhay  

Ammed and others (supra) conflicting views are being expressed in

Page 4

4

few of the subsequent judgments of this Court.  In Meghamala  

and others  v.  G. Narasimha Reddy and others (2010) 8 SCC  

383, this Court after referring to Abbai Maligai Partnership Firm  

and another (supra) and Kunhay Ammed and others (supra)  

expressed the following view:

“25. Thus, the law on the issue stands crystallised to  the effect that in case a litigant files a review petition  before filing the special leave petition before this Court  and it remains pending till the special leave petition  stands dismissed, the review petition deserves to be  considered. In case it is filed subsequent to dismissal of  the special leave petition, the process of filing review  application amounts to abuse of process of the court.

26. In view of the above, we are of the considered opinion  that filing of such a review application by the  respondents at a belated stage amounts to abuse of  process of the court and such an application is not  maintainable. Thus, the High Court ought not to have  entertained the writ petition against the order of  dismissal of the review application by the Special Court  and the order of the High Court to that extent is liable to  be set aside.”

6. In Palani Raman Catholic Mission v. S. Bagirathi Ammal  

(2009) 16 SCC 657 this Court has taken the view that review  

petition can be filed if no leave has been granted to file an appeal  

and until there is no appeal in the eye of law in the superior court,  

review can be preferred in the High Court under Order 47 Rule 1.

Page 5

5

This Court, in that case, set aside the judgment of the High Court  

and directed the High Court to consider the review petition in  

accordance with law.

7. Again in Bhakra Beas Management Board v. Krishan  

Kumar Vij and another (2010) 8 SCC 701 this Court held that the  

mere dismissal of a special leave petition at a preliminary stage  

does not constitute a binding precedent, and any order passed by  

the High Court placing reliance on earlier order, can still be  

challenged subsequently.

8. In K. Rajamouli v. A.V.K.N. Swamyi (2001) 5 SCC 37  

following the Judgment in Abbai Maligai Partnership Firm and  

another (supra) and Kunhay Ammed and others (supra) this  

Court further explained the principle of res-judicata and held as  

follows:

“Following the decision in the case of Kunhayammed we  are of the view that the dismissal of the special leave  petition against the main judgment of the High Court  would not constitute res judicata when a special leave  petition is filed against the order passed in the review  petition provided the review petition was filed prior to  filing of special leave petition against the main judgment  of the High Court. The position would be different where  after dismissal of the special leave petition against the

Page 6

6

main judgment a party files a review petition after a long  delay on the ground that the party was prosecuting  remedy by way of special leave petition. In such a  situation the filing of review would be an abuse of the  process of the law. We are in agreement with the view  taken in Abbai Maligai Partnership Firm1 that if the High  Court allows the review petition filed after the special  leave petition was dismissed after condoning the delay, it  would be treated as an affront to the order of the  Supreme Court. But this is not the case here. In the  present case, the review petition was filed well within  time and since the review petition was not being decided  by the High Court, the appellant filed the special leave  petition against the main judgment of the High Court.  We, therefore, overrule the preliminary objection of the  counsel for the respondent and hold that this appeal  arising out of special leave petition is maintainable.”

9. A different note was struck by this Court in Gangadhara  

Palo v. Revenue Divisional Officer and another (2011) 4 SCC  

602 and after referring to the Judgment in K. Rajamouli (supra)  

held as follows:  

“We regret, we cannot agree. In our opinion, it will  make no difference whether the review petition was filed  in the High Court before the dismissal of the special  leave petition or after the dismissal of the special leave  petition. The important question really is whether the  judgment of the High Court has merged into the  judgment of this Court by the doctrine of merger or not.

When this Court dismisses a special leave petition by  giving some reasons, however meagre (it can be even of  just one sentence), there will be a merger of the

Page 7

7

judgment of the High Court into the order of the  Supreme Court dismissing the special leave petition.  According to the doctrine of merger, the judgment of the  lower court merges into the judgment of the higher  court. Hence, if some reasons, however meagre, are  given by this Court while dismissing the special leave  petition, then by the doctrine of merger, the judgment of  the High Court merges into the judgment of this Court  and after merger there is no judgment of the High Court.  Hence, obviously, there can be no review of a judgment  which does not even exist.”

10. We notice that in K. Rajamouli (supra) this Court has  

followed Kunhay Ammed and others (supra) and distinguished  

Abbai Maligai Partnership Firm and another (supra) and in  

Gangadhara Palo (supra) later Bench did not accept the view  

expressed in K. Rajamouli (supra).  To this extent, there is some  

conflict between the Judgments in Gangadhara  Palo (supra) and  

K. Rajamouli (supra) which calls for resolution by a larger Bench.   

11. We may also point out, in this connection, that Article 136 of  

the Constitution does not confer any right of appeal on any party  

but it confers a discretionary power on the Supreme Court to  

interfere in suitable cases.   Clause 1 of Article 136 of the  

Constitution confers very wide and extensive powers on the

Page 8

8

Supreme Court.  Article commences with a non-obstante clause,  

the words are of over-riding effect and clearly indicate the intention  

of the framers of the Constitution that it is a special jurisdiction  

and residuary power unfettered by any statute or other provisions  

of Chapter IV of Part V of the Constitution.  The jurisdiction under  

Article 136 of the Constitution, of course, cannot be barred by  

statute since it is extraordinary power under Article 136.  Article  

136 is an extra-ordinary power which cannot be taken away by  

legislation.  

12. We also notice that several statutes confer on aggrieved parties  

right of appeal to the Supreme Court in contra distinction with the  

powers conferred on the Supreme Court under Article 136 of the  

Constitution, for instance, Section 15Z of the Securities and  

Exchange Board of India Act (SEBI), 1992 confers a right of appeal  

to any person aggrieved by any decision or order of the Securities  

Appellate Tribunal.   So also various regulatory legislations provide  

for statutory right of appeal.  To what extent, the principle of res-

judicata and merger would apply in respect of a decision rendered  

by this Court while exercising its statutory power of appeal as well

Page 9

9

as the one rendered while entertaining an appeal invoking Article  

136 is not seen considered by the larger bench either in Abbai  

Maligai or Kunhay Ammed’  case, which is also, in our view, an  

issue to be considered by the larger Bench.  

13. We notice considerable arguments are being raised before this  

Court as well as before various High Courts in the country on the  

maintainability of review petitions after the disposal of the special  

leave petition without granting leave but with or without assigning  

reasons on which also conflicting views are also being expressed by  

the two-Judge Benches of this Court.  In order to resolve those  

conflicts and for proper guidance to the High Courts, we feel it  

would be appropriate that this matter be referred to a larger bench  

for an authoritative pronouncement.

……………………………J. (K.S. Radhakrishnan)

….…………………………J. (Dipak Misra)

New Delhi, October 19, 2012.

Page 10

10

ORDER     IN     THE     PROCEEDING     PORTION   

Counsel for the petitioner pressed for an interim stay of the  

judgment of the High Court.  Learned counsel for the petitioner  

submits that he has paid the entire amount and the dispute is only  

with regard to the interest portion which roughly would come to  

Rs.1.62 crores.  Considering the facts and circumstances of the  

case we are inclined to give a direction to the petitioner to pay Rs.1  

crore to the respondent within a period of six weeks from today.  

There will be stay of realization of balance amount till the issue is  

decided finally.