Finding no contrary or restrictive provisions in the CPC,
we hold and declare that a suit and a counterclaim, if
adjudicated by a single common judgment; both on the original
claim and on the counterclaim, it can be challenged in a
composite appeal. The composite appeal, however, should
show the grounds raised against the decree in the suit and the
decree in the counterclaim separately; whether there are two
decrees or one drawn up. The composite appeal should also be
valued as two separate appeals and the court fees paid
accordingly. This would enable the appeal to be considered on
merits, without the grounds of estoppel and res judicata raised
only for reason of two appeals not being filed. Though an
implied mandate could be drawn from the various provisions,
we are of the opinion that this would ensure avoidance of
procedural rigmarole as also multiplicity of litigations. {Para 29}
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No. of 2026
(Arising out of SLP (C) No.4338 of 2025)
Basudev & Ors. Vs Sanjay Kumar & Ors.
Author: K.Vinod Chandran, J.
Citation: 2026 INSC 831.
Leave granted.
2. The question to be answered in this appeal is as to
whether there should be two appeals filed from the two decrees
drawn up when a suit with a counterclaim is disposed of by a
single judgment. The ancillary question would also be whether
in every such situation two decrees should be drawn up.
3. In the present case, a suit was filed and a counterclaim
was raised. The Trial Court allowed the suit claim and
dismissed the counterclaim. A single appeal was filed by the
defendants; in which the suit was dismissed and the
counterclaim was allowed. The High Court in second appeal
found that the single appeal was incompetent and relied on the
decision of a Division Bench in Ramesh Chand v. Om Raj and
Others1. It was held that in the nature of the disposal, decreeing
the suit and rejecting the counter claim, there ought to be two
separate appeals filed. In the teeth of the principle of waiver
and estoppel the single appeal will have to be rejected was the
finding. We are not concerned with the merits of the claims;
suffice it to notice that when the plaintiffs claimed half share and
sought for an injunction against interference, the defendants
raised a counterclaim of ownership over the entire property.
4. Sri Jayant Bhushan, learned Senior Counsel for the
appellants, would first point out that there is only one decree
drawn up which is produced at Annexure P-13. When the Court
itself had drawn up only one decree, the defendant’s appeal
filed, could not have been rejected is the argument. Reliance
was also placed on Narhari v. Shanker2 and Charan Singh v.
Ram Saroop3.
5. Sri Sanjay R. Hegde, learned Senior Counsel for the
respondents, relied upon Ramesh Chand1, as relied on in the
1 2022 (2) SLC 1145
2 1950 SCC 668
3 C.A. No.1585-1586 of 2025 dated 03.02.2025
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impugned judgment and specifically referred to Premier Tyres
Ltd. v. Kerala State Road Transport Corporation4. The
defendant does not dispute the position that there will be only
one decree, but there has to be two appeals filed, is the
contention.
6. We would first look at the decisions on this point, urged
by both the learned Senior Counsel; in the arguments
addressed and the written submissions.
7. Narhari2 dealt with a suit filed to establish 2/3rd rights
over a property against eight defendants, wherein two sets of
defendants, set up separate claims of 1/3rd rights each over the
suit property. The Trial Court decreed the suit and the two
separate appeals filed were allowed, dismissing the suit and
allowing the counterclaims. The plaintiff preferred two second
appeals, one, within time and the other, delayed. The delayed
appeal was dismissed on the ground of limitation and as a
consequence, the other appeal also stood dismissed, finding it
to be hit by res-judicata. This Court found the ground of resjudicata
to be specious, when there is only one suit, the decrees
founded on the same judgment, deciding the entire suit. It was
4 1993 Supp. (2) SCC 146
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found that the two decrees, in substance are one and besides,
the High Court had failed to give the benefit of Section 5 of the
Limitation Act, especially when there were conflicting
decisions on this question.
8. In Charan Singh3 the Trial Court dismissed the suit and
allowed the counterclaim against which only one appeal was
preferred, which was dimissed as not maintainable. This Court
found the requirement in law, to file two appeals, but went on to
permit the appellant to file a separate memorandum of appeal,
without a certified copy of the judgment since, Order XLI Rule
1 of the CPC permitted the Appellate Court to dispense with the
requirement of filing a copy of the impugned judgment twice
over even when two separate appeals are filed. This was
observed to be in furtherance of ends of justice, so that the
subject matter is considered on its merits.
9. In Girija and Ors. v. Rajan5 the High Court of Kerala
considered an identical substantial question of law as to
whether the single appeal filed from the dismissal of a counter
claim, without an appeal against the decree in the suit, would
fail on the ground of res-judicata. Reliance was placed on a
5 2015 (1) KLT 695
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decision of this Court in Premier Tyres Limited4 to extract the
following: -
“Where an appeal arising out of connected suits is
dismissed on merits the other cannot be heard and has
to be dismissed. Where no appeal is filed, as in this
case from the decree in connected suit, it has the same
effect of non-filing of appeal against the judgment or
decree. Thus, the finality of finding recorded in the
connected suit, due to non-filing appeal, precludes
the court from proceeding with appeal in other suit.”
10. The argument that the power of the Appellate Court under
Order XLI Rule 33 of the CPC was all encompassing, being a
continuation of the original proceeding, empowering it to pass
any decree or make any order and such further orders or
decree as the case may require, was negated. It was held that
the power under Order XLI Rule 33 cannot be invoked against
specific statutory provisions: namely, Section 11 of the CPC.
Res-judicata is non-negotiable and indefeasible, creating an
absolute bar against the Court from deciding a matter which
was substantially in issue and decided in a former case. State of
Punjab v. Bakshish Singh6 was relied on for the principle that
Order XLI Rule 33 is discretionary and in the garb of exercising
such power, the scope of appeal cannot be enlarged. Order VIII
6 (1998) 8 SCC 222
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Rule 6A of the CPC clothes a counterclaim with all the
characteristics of a cross suit, including the vulnerability of
suffering the bar of res-judicata enshrined in Section 11 of the
CPC, if not properly appealed, was the finding. The first appeal
filed in the said case against the decree passed in the suit was
held to be barred by res-judicata since the dismissal of the
counterclaim was not challenged.
11. Shankar Masu Dokare v. Shobha Subhash Dokare and
Anr.7 from the High Court of Bombay considered an identical
issue. Narhari2 was relied on to hold that, when there is one
suit and a counterclaim, there is only; one trial, one finding and
one decision and hence there need not be two appeals. Order
XLI Rule 1 of the CPC postulated only filing of one copy of the
judgment if the suits are tried together, even if two decrees are
passed. Order XX Rule 19 of the CPC posits that the decree
passed in a suit in which a counterclaim is filed, shall be subject
to the same provisions in respect of an appeal, if there was no
counter claim. This cannot be extended to contend that there is
requirement for filing of two appeals. Thus, the prayer in the
suit and the counterclaim are so interlinked that the
7 2014 SCC Online Bom 1859
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requirement was only to file one appeal, which is not in
contravention of any of the provisions of the CPC, was the
finding.
12. Abdul Nazer v. Lakshmana Das8 dealt with a defect noted
by the Registry, that one appeal would not suffice against two
decrees; one dismissing the suit and the other allowing the
counterclaim, based on Girija5. It was held, Rule 6A of Order
VIII of the CPC confers on the counter claim the same effect as
a cross-suit and it is to be treated as a plaint, by a legal fiction
employed by sub-rules (2) and (4) of Rule 6A CPC. Rule 19(1)
of Order XX CPC was also referred, to hold that homogeneity is
evident in the composite decree which has to state what amount
is due to the plaintiff and the defendant, with the sum for
recovery specified, which appears to be due to either the
plaintiff or the defendant. Rule 6C of Order VIII providing for
raising an objection against the counterclaim as being
independent of the original claim in the suit, clearly indicates
that it is a unified proceeding as held in T.K.V.S.
Vidyapoornachary Sons v. M.R. Krishnamahary9. The
decision in Girija5 was reversed in Abdul Nazer8 by a Division
8 2016 SCC OnLine Ker 41103
9 AIR 1983 Mad 291
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Bench and it was held that the single appeal filed would be
maintainable against the decrees respectively passed in the
suit and in the counterclaim.
13. The High Court of Madras in T.K.V.S. Vidyapoornachary
Sons9 held that though Order VIII Rule 6A speaks of a
counterclaim as a plaint at one place and a cross-claim at
another, the operative portion lays down that the court shall
pronounce a single judgment in the suit, both on the original
claim and on the counterclaim. Thus, a suit-claim and a
counterclaim are not distinctly apart and Rule 6C by implication
emphasizes that a suit-claim and a counterclaim constitute a
unified proceeding.
14. Ghanshyam Singh v. Narendra Singh10 from the High
Court of Uttarakhand relied on Rajni Rani & Another v. Khairati
Lal11 to hold that one composite appeal against the two
independent and distinct decrees; in the suit and a
counterclaim, would not be tenable since they are independent
proceedings. Immediately, we have to notice that we are
unable to agree that Rajni Rani11 propounded such a view.
Considerable reliance was placed on Rajni Rani11, in the
10 Second Appeal No.76 of 2022 decided on 22.07.2022 by High Court of Uttarakhand at Nainital
11 (2015) 2 SCC 682
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written submission of the respondents also, to uphold the
impugned judgment, despite accepting that there need be only
a single decree drawn up in the suit and the counter claim.
15. In Rajni Rani11 the suit for declaration of ownership was
resisted with a counterclaim, by some defendants, claiming to
be the real owners of the suit scheduled property, based on a
will. The other defendants sought dismissal of the counterclaim
on the ground that it was barred by Order II Rule 2 of the CPC;
since in an earlier suit between the same parties, with respect
to the very same property, the said claim was not raised. The
learned Trial Judge dismissed the counterclaim against which a
revision was filed under Article 227 of the Constitution of India.
This Court at the very outset made it clear that they would not
advert to the merits of the order and were only concerned
whether a revision petition could have been entertained or
whether it was obligatory to assail the order by way of an
appeal. Extracting Rule 6A, 6B and 6D of Order VIII of the CPC,
it was found that the counterclaim in the suit is in the nature of a
suit and even if the suit is to be dismissed, the counterclaim
would remain alive for adjudication. We cannot but observe
that this was not to declare that the suit could be dismissed at
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the first instance and then the counterclaim was to be
considered as an independent suit. In fact, the court
emphasized in Paragraph 9.6 that the very scheme of a
counterclaim is to avoid multiplicity, and the court is required
to pronounce a final judgment in the suit, both on the original
claim and on the counterclaim; the seminal purpose being to
avoid piecemeal adjudication.
16. In Gumai Singh v. Baburam12, the High Court of Madhya
Pradesh relied on Rajni Rani11 to find that a suit and a
counterclaim when disposed of by a single judgment, there are
two decrees drawn up, and both have to be appealed
separately in two different appeals. The High Court of Madras
in K. Kandasamy v. P. Natarajan & Others13, held otherwise,
that, a single appeal would be maintainable against a common
judgment rendered in a suit and a counterclaim, since Order
VIII Rule 6A of the CPC treats the counterclaim as a cross-suit
which culminates in a single judgment and a composite decree,
which does not necessitate multiplicity of appeals.
17. Ramesh Chand1, as relied on in the impugned judgment,
also found that where both the suit and the counterclaim are
12 Second Appeal No.144 of 2012 decided on 28.07.2025 by Madhya Pradesh High Court at Gwalior
13 2026 SCC OnLine Mad 14
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disposed of by a common judgment, regardless of whether
separate decrees have been prepared, there shall be two
appeals filed (Para 42 (iv)). The appellants argued that that this
would in fact be contrary to the principle enunciated in the very
same decision in Para 42 (i), that when two suits are
consolidated and tried together, the same can be subjected to
challenge by way of a single appeal, while, two suits, which
were not consolidated but are decided by a common judgment,
require a challenge by way of two appeals (Para 42(iii)). As held
in Rajni Devi11. It was found that there could be situations when
the suit is dismissed; in default or as withdrawn, then the
counter claim is continued.
18. The aforesaid decisions clearly indicate that there is a
cleavage of opinion, insofar as whether two appeals are
required to be filed when there is a suit and a counterclaim,
both being disposed of by a common judgment. There also
seems to be dissimilarity in the procedure adopted in the
different States, in drawing up the decree from a single
judgment, allowing one claim and rejecting the other, which
normally gives rise to two decrees. We are in full agreement
with the interpretation of Rule 6A to 6D of Order VIII of the CPC;
Page 12 of 23
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inserted in 1976, as declared in Rajni Rani11. Rule 6A (1)
enabled a counterclaim against the claim in the plaint, in
addition to the right to plead set off. Sub-rule (2) enables the
counterclaim to be treated as a cross-suit, facilitating a common
judgment, both on the suit claim and the counterclaim. The
plaintiff is provided a right to file a written statement in answer
to the counterclaim, especially since the counterclaim is
deemed to be a plaint under sub-rule (4); governed by the rules
applicable to plaints. The rules relating to written statements
are also made applicable to the written statement in reply to the
counterclaim, by virtue of Rule 6G of Order VIII.
19. We also agree with the finding that when Rule 6C of
Order VIII excludes a counterclaim, when it is an independent
cause required to be agitated in an independent suit, it implies
that a counterclaim should be so interlinked with the suit claim
to facilitate adjudication of both; on the evidence led at one
trial. It is noticing Rule 6D, that, even if the suit is stayed,
discontinued or dismissed, the counterclaim may nevertheless
be proceeded with; that Rajni Rani11 expressed the opinion,
that a suit even if dismissed the counterclaim survives, which
was misinterpreted by two High Courts to find a requirement
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for two appeals from a common judgment adjudicating a suit
and counter claim.
20. We reiterate that in Ranji Rani11 the question was
whether the rejection of a counterclaim for reason of it being
barred by Order II Rule 2, has to be challenged in appeal or
whether a revision would lie under Article 227 of the
Constitution of India. The question of two appeals being filed
from a decree in the counterclaim and the suit, did not arise at
all since in Rajni Rani11 the suit was pending before the Trial
Court, and the counterclaim alone was rejected under order VII
Rule 11; which rejection order was amenable only to an appeal.
But there may arise occasions where there should be two
decrees drawn up, like in Rajni Rani11 itself. If the appeal
against the dismissal of the counter claim, on a decree drawn
up, is pending without a stay of the suit and eventually the suit
is either dismissed or allowed, then necessarily there should be
another decree drawn up, which would also have to be
subjected to an appeal.
21. In this context, we also notice Order XX Rule19 from
which sub-rule (1) was noticed in Abdul Nazer8, which applies
to a suit for recovery of money, when a counterclaim is also with
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respect to the money due. Rule 19(1) may not have application
in the very many cases we noticed, wherein the subject matter
of the suit was a claim and counterclaim with respect to
ownership and possession of immovable property. Apposite
would be sub-rule (2) of Order XX Rule 19, which indicates that
any decree passed in a suit, in which a set off or counterclaim is
raised, shall be subject to the same provisions applicable to a
suit in which no counterclaim is raised. It only indicates that
when a counterclaim is raised and decided, the appeal
provisions with respect to a decree in a suit would squarely
apply. It does not, according to us, either require that two
appeals have to be filed or by implication prohibit a single
appeal.
22. Here, we have to notice the judgment of this Court in
Laxmidas Dayabhai Kabrawala v. Nanabhai Chunilal
Kabrawala14, rendered in a slightly different context. Therein
one of the partners, filed a suit for enforcement of an
agreement, entered into with a deceased partner; resisted by
the legal representatives of the deceased, with a counterclaim
of settlement of accounts on dissolution of the firm. The Trial
14 AIR 1964 SC 11
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Court while dismissing the suit held the counterclaim to be not
permissible under the CPC, but left liberty to bring a separate
suit for accounts and share of the profits, if so advised. Even in
the absence of a provision enabling a counterclaim, it was held
by a majority that despite the counter claim raised not
confirming to the requirements of a plaint, as prescribed in the
CPC, it could as well be treated as a cross suit. It is not proper
to deny the court the power and jurisdiction to read and
construe the pleadings in a reasonable manner and consider
the claim raised, as would have been dealt with, if it was made
in the form of a plaint. Eventually the matter was restored to the
Trial Court permitting the defendant to file a fresh written
statement raising the counter claim satisfying the requirements
of a plaint, as provided in the CPC and the plaintiff given further
opportunity to controvert such pleadings by a written
statement. Laxmidas Dayabhai Kabrawala14 even in the teeth
of the unamended CPC, permitting only a cross suit, sans the
enabling provision to raise a counterclaim, directed the
counterclaim to be considered as a cross-suit. This very scheme
has been brought into operation after the amendment of 1976
in the CPC enabling a counterclaim by the defendant in a suit.
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23. In this context, we notice the concurring judgment in
Abdul Nazer8 noticing Owners and Parties Interest in M.V.
‘Vali Pero’ v. Fernandeo Lopez and Others15, as to the rule of
procedure, extracted herein: -
“Rules of procedure are not by themselves an end but
the means to achieve the ends of justice. Rules of
procedure are tools forged to achieve justice and are not
hurdles to obstruct the pathway to justice. Construction
of a rule of procedure which promotes justice and
prevents its miscarriage by enabling the court to do
justice in myriad situations, all of which cannot be
envisaged, acting within the limits of the permissible
construction, must be preferred to that which is rigid and
negatives the cause of justice. The reason is obvious.
Procedure is meant to subserve and not rule the cause of
justice. Where the outcome and fairness of the
procedure adopted is not doubted and the essentials of
the prescribed procedure have been followed, there is
no reason to discard the result simply because certain
details which have not prejudicially affected the result
have been inadvertently omitted in a particular case. In
our view, this appears to be the pragmatic approach
which needs to be adopted while construing a purely
procedural provision. Otherwise, rules of procedure will
become the mistress instead of remaining the handmaid
of justice, contrary to the role attributed to it in our legal
system.”
24. Section 96 of the CPC provides an appeal from every
decree leading to the unequivocal declaration of law by the
15 (1989) 4 SCC 671
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High Courts and this Court, that an appeal is from a decree and
not from a judgment. Order XLI Rule 1 as it was before the
amendment in 01.07.2002 also required the Memorandum of
Appeal to be accompanied by a copy of the decree. As of now,
the word ‘decree appealed from and (unless the Appellate court
dispenses therewith) of the judgment on which it is founded’ has
been substituted with the word ‘judgment’ in Order XLI Rule 1
with effect from 01.07.2002. The intention of the legislature is
very clear that the delay in drawing up decrees shall not
frustrate the appellate remedy and there should be an end to
multiplicity of proceedings.
25. Immediately, we have to notice Rule 6A of Order XX, CPC
having the nominal heading of ‘Preparation of decree’. Sub-rule
(1) speaks of expeditious drawing up of a decree, at any rate,
within fifteen days from the date of pronouncement of
judgment. Sub-rule (2) permits an appeal to be preferred, with
a judgment, if a decree has not been drawn up, which shall for
the purposes of Rule 1 of Order XLI be treated as a decree. It is
also provided that as soon as a decree is drawn up, the
judgment shall cease to have the effect of a decree for the
purpose of execution or for any other purposes. The provision
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insofar as an appeal is concerned is redundant since Rule 1 of
Order XLI permits an appeal to be filed accompanied by a
judgment. Hence, sub-rule (2) of Order XX Rule 6A only applies
insofar as execution, as of now.
26. In this context, we have to notice that before the
amendment brought to Rule 6A of Order XX by Act 46 of 1999,
it provided that “the last paragraph of the judgment shall state in
precise terms the relief which has been granted by such
judgment’(sic). This stood omitted by Act 46 of 1999, the
consequence of which came up for consideration before the
Andhra Pradesh High Court in Faqruddin v. Didde
Mahadevappa and Others16. Therein the suit was filed for
declaration of title, recovery of possession and consequential
injunction. The suit was fully decreed but however in the
operative portion of the judgment, recovery of possession was
omitted, which hence did not figure in the decree also. On
execution being filed, recovery was objected to, on the trite
principle that the Execution Court cannot go beyond a decree.
A learned Single Judge of the High Court agreed with the
objection, but gave liberty to the plaintiff to approach the Trial
16 2004 (5) ALT 469
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Court under Section 152 of the CPC for correction of the decree.
The learned Single Judge noticed that the omission of that
portion in Rule 6A created more problems than it resolved. It
was also noticed that simultaneous to the said omission Order
XLI Rule 1 was also amended, facilitating an appeal to be filed
accompanied by a copy of the judgment and not the decree.
Thus, confining the application of a decree to the execution
proceedings.
27. Lakshmi Ram Bhuyan v. Hari Prasad Bhuyan17 though
rendered after the amendment, did not notice the omission
made in Rule 6A. Therein, the High Court had in Second Appeal
overturned a concurrent decision of the Trial Court and the
Appellate Court but allowed the appeal with costs and a
direction to the Trial Court, to draw up a decree. Since the relief
was not specified, the Trial Court drew up a decree, with
provision for cost alone which was challenged before this
Court. It was held that the obligation cast by Order XX of the
Code that the decree should agree with the judgment, spells
out an obligation on the part of the author of the judgment to
clearly indicate the relief or reliefs to which a party, in his
17 (2003) 1 SCC 197
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opinion, has been found entitled, to enable decree being
framed in such a manner that it agrees with the judgment and
specifies clearly the relief granted or other determination of the
suit. The operative part of the judgment should be so clear and
precise that in the event of an objection being laid, it should not
be difficult to find out by a bare reading of the judgment and
decree whether the latter agrees with the former and is in
conformity therewith. ‘A self-contained decree drawn up in
conformity with the judgment would exclude objections and
complexities arising at the stage of execution’ (sic). The Andhra
Pradesh High Court held that though Rule 6A was amended with
the aforesaid omission, the judgment of this Court having been
pronounced after such amendment, it takes care of the vacuum
created by the omission, being the law of the land under Article
141 of the Constitution of India. For completeness, we have to
notice that even this Court in Lakshmi Ram Bhuyan17 left it to
the decree holder to approach the High Court to get modified
the decree.
28. We have been informed that in certain States, two decrees
are drawn up from a common judgment in a suit and a
counterclaim, but in others there is only one decree drawn up,
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as in this case. The necessity of two decrees or one single
decree, pales into insignificance, especially when the provision
for appeal requires only a judgment to accompany the
Memorandum of Appeal. The proviso to Order XLI Rule 1
enables the certified copy of the judgment to be dispensed
with, when two appeals from a common judgment in two suits
tried together, are preferred, whether or not the appeals are
filed by the same person or not. However, the fact remains that
the claim in the suit and the counterclaim, when treated as
cross-suits, court fees are to be paid for the claim raised in the
suit and also counterclaim raised in the written statement.
Hence, whether it be a single decree or two, when a composite
appeal is filed from a common judgment in the suit and the
counterclaim, necessarily court fees have to be paid on the
valuation in the suit and the counterclaim as applicable to
appeals.
29. Finding no contrary or restrictive provisions in the CPC,
we hold and declare that a suit and a counterclaim, if
adjudicated by a single common judgment; both on the original
claim and on the counterclaim, it can be challenged in a
composite appeal. The composite appeal, however, should
show the grounds raised against the decree in the suit and the
decree in the counterclaim separately; whether there are two
decrees or one drawn up. The composite appeal should also be
valued as two separate appeals and the court fees paid
accordingly. This would enable the appeal to be considered on
merits, without the grounds of estoppel and res judicata raised
only for reason of two appeals not being filed. Though an
implied mandate could be drawn from the various provisions,
we are of the opinion that this would ensure avoidance of
procedural rigmarole as also multiplicity of litigations.
30. On the above reasoning and also finding that there was
considerable flux insofar as whether there should be two
appeals or a composite appeal, in disposal of this appeal, it
would suffice, if we direct the first appeal to be restored, which
we do, and to facilitate that, the impugned orders of the High
Court and the First Appellate Court are set aside. The appellant
herein would be entitled to file a fresh memorandum with
separate grounds taken and pay court fees for the one
additional appeal. The appeal so filed shall be considered by
the First Appellate Court along with the other appeal, on merits
as expeditiously as possible considering the delay that has now
been occasioned. We make it clear that we direct another
appeal to be filed in this case since there is already one appeal
filed, but henceforth a challenge against a common judgment
in a suit and counterclaim, can be by way of a composite
appeal, as directed herein above.
31. The appeal is allowed with the above directions.
32. Pending application(s), if any, shall stand disposed of.
33. The Registry shall forward one copy each of this judgment
to all the High Courts.
.......…….……………………. J.
(J. B. PARDIWALA)
....……….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI;
AUGUST 11, 2026.
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