Supreme Court Rules on Review Petitions After Dismissal of Special Leave Petitions

The Supreme Court of India, in Khoday Distilleries Ltd. (Now Known as Khoday India Limited) & Ors. vs. Sri Mahadeshwara Sahakara Sakkare Karkhane Ltd., addressed the crucial question of whether a review petition can be maintained before a High Court after the dismissal of a Special Leave Petition (SLP) by the Supreme Court. The ruling clarifies the legal principles surrounding the doctrine of merger and the scope of review jurisdiction after an SLP is dismissed in limine.

Background of the Case

The case originated from a money suit filed by the respondent against the appellant in the City Civil Court, Bangalore, for recovery of Rs. 1,00,76,630/- with interest. The trial court dismissed the suit as barred by limitation, even after finding that the amount was payable by the appellant.

However, the respondent appealed to the Karnataka High Court, which reversed the trial court’s decision and decreed the suit in favor of the respondent on November 12, 2008. The High Court also directed the appellant to pay interest at:

• 12% per annum from July 19, 1994, to August 3, 1994, and
• 10% per annum from August 4, 1994, till payment.

The appellant challenged the High Court’s order by filing an SLP before the Supreme Court, but the SLP was dismissed in limine (without a detailed order) on December 4, 2009.

Filing of Review Petition in the High Court

Following the dismissal of the SLP, the appellant filed a review petition before the Karnataka High Court, arguing that:

• The High Court had granted relief beyond the respondent’s original prayer in the suit.
• The decree included an interest rate that was not sought in the original suit.
• The award of interest from August 4, 1994, was without jurisdiction.

The Karnataka High Court dismissed the review petition on September 9, 2011, holding that since the Supreme Court had already dismissed the SLP, it could not entertain a review petition.

The appellant then filed a fresh appeal before the Supreme Court.

Key Legal Question Before the Supreme Court

The central question before the Supreme Court was:

“Is a review petition maintainable before the High Court after the dismissal of a Special Leave Petition (SLP) by the Supreme Court?”

This issue had conflicting precedents, with different Supreme Court Benches offering varying interpretations of the doctrine of merger.

Arguments by the Appellant

The appellant contended that:

• An SLP dismissed in limine without a speaking order does not constitute a decision on the merits.
• The doctrine of merger does not apply when an SLP is dismissed without detailed reasoning.
• The High Court had wrongly assumed that it had no jurisdiction to entertain the review petition.
• The decree passed by the High Court was beyond the scope of the original prayer in the suit and needed correction.

Arguments by the Respondent

The respondent opposed the review petition, arguing that:

• Once an SLP is dismissed, the High Court cannot entertain a review petition.
• The principle of finality applies, preventing reopening of the case at the High Court level.
• The Karnataka High Court had rightly dismissed the review petition, following the Supreme Court’s decision in Abbai Maligai Partnership Firm v. K. Santhakumaran (1998).

Supreme Court’s Observations

The Supreme Court analyzed the legal position regarding review petitions after the dismissal of an SLP:

• The doctrine of merger does not apply when an SLP is dismissed in limine without assigning reasons.
• A dismissal of an SLP does not mean that the High Court’s order has been affirmed on merits.
• The High Court had the jurisdiction to entertain the review petition and should have examined it on merits.
• The appellant had a legitimate grievance that the decree had been passed beyond the scope of the original suit.

The Supreme Court distinguished its earlier ruling in Abbai Maligai, noting that:

“A distinction must be made between cases where an SLP is dismissed with a reasoned order, thereby affirming the High Court’s judgment, and cases where it is dismissed without any discussion on merits.”

Final Judgment

The Supreme Court set aside the Karnataka High Court’s order and held that:

• The review petition filed by the appellant was maintainable.
• The Karnataka High Court must rehear and decide the review petition on merits.
• Since the Supreme Court had dismissed the SLP in limine, the High Court’s order had not merged with the Supreme Court’s order.

Conclusion

This landmark ruling clarifies that the dismissal of an SLP without detailed reasoning does not preclude a party from seeking a review of the High Court’s order. It ensures that litigants are not denied the opportunity to correct errors in judgments, reinforcing the principles of fairness and justice.

Petitioner Name: Khoday Distilleries Ltd. (Now Known as Khoday India Limited) & Ors..
Respondent Name: Sri Mahadeshwara Sahakara Sakkare Karkhane Ltd..
Judgment By: Justice A.K. Sikri, Justice S. Abdul Nazeer, Justice M.R. Shah.
Place Of Incident: Bangalore, Karnataka.
Judgment Date: 01-03-2019.

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