Alka Gupta v. N K Gupta (2010) 10 SCC 141

This case separates two ideas that students often mix up:

• Res judicata stops a fresh suit only when the same dispute was already decided earlier.
• Order 2 Rule 2 CPC stops a fresh suit only when both suits come from the same cause of action, and a part was wrongly left out first time.

Here, the first suit asked for money under an Agreement to Sell. The later suit asked for partnership accounts. The Supreme Court said: these are different. So, no bar under res judicata or Order 2 Rule 2. The suit must go to trial.

1. Is the later suit barred by the rule of res judicata?
2. Is it barred by Order 2 Rule 2 CPC for splitting claims?

• Res Judicata: The second suit is barred only if the very same matter, directly and substantially, was decided before. “Constructive” res judicata applies only to a claim that should have been raised earlier. Courts cannot assume this bar without a proper plea and framed issue.
• Order 2 Rule 2 CPC: Bar works only when both suits arise from the same cause of action and a claim was omitted or given up earlier. Without a clear plea and issue, dismissal under this rule is unsafe.
• Section 69, Partnership Act: An unregistered firm cannot sue to enforce a contract right, but a partner may still seek dissolution and rendition of accounts.

• No res judicata: The two suits arise from different transactions and issues.
• Order 2 Rule 2 not attracted: Not the same cause of action; also, no proper plea/issue was framed.
• Section 69 not a bar: A partner may sue for dissolution and accounts even if the firm is unregistered.
• Procedural fairness: Courts cannot dismiss a suit without trial based only on doubts about a party’s character.

Different cause, different bar: Money claim under a sale agreement ≠ partnership accounts suit. Without identity of cause and matters in issue, neither res judicata nor Order 2 Rule 2 applies. Section 69 does not prevent suits for dissolution and accounts.

• Clean exam answer on the line between claim on contract price and claim for partnership accounts.
• Shows courts must respect pleadings and issues before applying technical bars.
• Helpful authority to resist hasty dismissals at the threshold.

• 1 Same parties ≠ same cause. Check the transaction and relief.
• 2 O2R2 needs a plea, proof, and identity of cause of action.
• 3 Section 69 allows dissolution/accounts despite non-registration.
• 4 No “character test” at admission: evidence needs trial.

Mnemonic: “PRICE vs. PARTNERS”

• PRICE → Price under sale agreement (first suit).
• PARTNERS → Partnership accounts (second suit).
• Different baskets → no res judicata / no O2R2.

3-Step Hook:

1. Name the basket: contract price or partnership accounts?
2. Match the issues: are they the same core dispute?
3. Check the plea: was O2R2 properly pleaded and framed?

Res Judicata

A decided matter cannot be re-litigated between the same parties.

Order 2 Rule 2 CPC

All claims from the same cause must be sued together; else later claim may be barred.

Rendition of Accounts

Court-ordered accounting of partnership/business profits and liabilities.

Section 69 (Partnership Act)

Limits suits by unregistered firms to enforce contract rights; does not bar dissolution/accounts.