Order 23

Order 23 – Withdrawal and adjustment of Suit.

CPC provides for the withdrawal, adjustment and compromise of suits and deal with two kinds
of withdrawal and adjustment. These are:
• Absolute withdrawal – withdrawal and adjustment of suit without the leave of the court,
and
• Qualified withdrawal – withdrawal and adjustment with the leave of the court.

• Abandonment of a suit or part of his claim against all or any of the defendant is an
absolute and unqualified right of a plaintiff and a court has no power to refuse
permission to withdraw the suit or direct him to proceed with it.
• Where the court is satisfied that a suit must fail by reason of some formal defect or that
there are sufficient grounds for allowing the plaintiff to institute a fresh suit for the
subject matter of a suit or part of a claim it may grant t he plaintiff permission to
withdraw from such suit or such part of the claim with liberty to institute a fresh suit in
respect of the subject matter of such suit or such part of the claim.
• The primary object behind allowing the withdrawal of a suit and subsequently allowing
its fresh institution is to prevent the defeat of Justice on technical grounds. Where the
code grants permission to a plaintiff to withdraw the suit with liberty to file a fresh suit,
the principle of estoppel does not operate and the bar of res judicata r does not apply.
• The court has no power apart from this rule to allow a suit to be withdrawn with liberty
to file as fresh suit and the power should be exercised subject to the conditions
prescribed therein.

Bakhtawar Singh vs. Sada Kaur, AIR 1996 SC 3488 –

Where a suit is filed in the court of competent jurisdiction and withdrawn with the liberty of
file a fresh suit, the period spent in prosecuting the cause in an earlier suit is not to be excluded
in computing limitation. This rule applies to appeal. Hence an appellate court may allow an
appeal to be withdrawn, and the High Court may allow a second appeal to be withdrawn.

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Sarguja Transport Service vs. State Transport Appellate Tribunal, M.P., Gwalior and Ors.
(12.11.1986 - SC) : MANU/SC/0114/1986

The main contention urged before this Court by the learned Counsel for the petitioner is that
the High Court was in error in rejecting the writ petition out of which this case arises, on the
ground that the petitioner had withdrawn the earlier writ petition in which he had questioned
the order passed by the Tribunal on 4.10.1985 without the permission of the High Court to file
a fresh petition. It is urged by the learned Counsel that since the High Court had not decided
the earlier petition on merits but only had permitted the petitioner to withdraw the petition, the
withdrawal of the said earlier petition could not have been treated as a bar to the subsequent
writ petition.

In this case we are called upon to consider the effect of the withdrawal of the writ petition filed
under Articles 226/227 of the Constitution of India without the permission of the High Court
to file a fresh petition. The provisions of the CPC, 1908 (hereinafter referred to as 'the Code')
are not in terms applicable to the writ proceedings although the procedure prescribed therein
as far as it can be made applicable is followed by the High Court in disposing of the writ
petitions. Rule 1 of Order XXIII of the Code provides for the withdrawal of a suit and the
consequences of such withdrawal. Prior to its amendment by Act 104 of 1976, Rule 1 of Order
XXIII of the Code provided for two kinds of withdrawal of a suit, namely, (i) absolute
withdrawal, and (ii) withdrawal with the permission of the Court to institute a fresh suit on the
same cause of action. The first category of withdrawal was governed by Sub-rule (1) thereof,
as it stood then, which provided that at any time after the institution of a suit the plaintiff might,
as against all or any of the defendants 'withdraw' his suit or abandon a part of his claim. The
second category was governed by Sub-rule (2) thereof which provided that where the Court
was satisfied (a) that a suit must fail by reason of some formal defect, or (b) that there were
sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject-matter of a
suit or part of a claim, it might, on such terms as it thought fit, grant the plaintiff permission to
withdraw from such suit or abandon a part of a claim with liberty to institute a fresh suit in
respect of the subject-matter of such suit or such part of the claim. Sub-rule (3) of the former
Rule 1 of Order XXIII of the Code provided that where the plaintiff withdrew from a suit or
abandoned a part of a claim without the permission referred to in Sub-rule (2) he would be
liable to such costs as the Court might award and would be precluded from instituting any fresh
suit in respect of such subject-matter or such part of the claim. Since it was considered that the
use of the word 'withdrawal' in relation to both the categories of withdrawals led to confusion,
the rule was amended to avoid such confusion.

It may be noted that while in Sub-rule (1) of the former Rule 1 of Order XXIII of the Code the
words 'withdraw his suit' had been used, in Sub-rule (1) of the new Rule 1 of Order XXIII of
the Code, the words 'abandon his suit' are used. The new Sub-rule (1) is applicable to a case
where the Court does not accord permission to withdraw from a suit or such part of the claim
with liberty to institute a fresh suit in respect of the subject-matter of such suit or such part of
the claim. In the new Sub-rule (3) which corresponds to the former Sub-rule (2) practically no
change is made and under that sub-rule the Court is empowered to grant subject to the
conditions mentioned therein permission to withdraw from a suit with liberty to institute a fresh
suit in respect of the subject-matter of such suit. Sub-rule (4) of the new Rule 1 of Order XXIII

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of the Code provides that where the plaintiff abandons any suit or part of claim under Sub-rule
(1) or withdraws from a suit or part of a claim without the permission referred to in Sub-rule
(3), he would be liable for such costs as the Court might award and would also be precluded
from instituting any fresh suit in respect of such subject-matter or such part of the claim.
The Code as it now stands thus makes a distinction between 'abandonment' of a suit and
'withdrawal' from a suit with permission to file a fresh suit. It provides that where the plaintiff
abandons a suit or withdraws from a suit without the permission, referred to in Sub-rule (3) of
Rule 1 of Order XXIII of the Code, he shall be precluded from instituting any fresh suit in
respect of such subject-matter or such part of the claim. The principle underlying Rule 1 of
Order XXIII of the Code is that when a plaintiff once institutes a suit in a Court and thereby
avails of a remedy given to him under law, he cannot be permitted to institute a fresh suit in
respect of the same subject-matter again after abandoning the earlier suit or by withdrawing it
without the permission of the Court to file fresh suit. Invito beneficium non datur. The law
confers upon a man no rights or benefits which he does not desire. Whoever waives, abandons
or disclaims a right will loose it. In order to prevent a litigant from abusing the process of the
Court by instituting suits again and again on the same cause of action without any good reason
the Code insists that he should obtain the permission of the Court to file a fresh suit after
establishing either of the two grounds mentioned in Sub-rule (3) of Rule 1 of Order XXIII. The
principle underlying the above rule is founded on public policy, but it is not the same as the
rule of res judicata contained in Section 11 of the Code which provides that no court shall try
any suit or issue in which the matter directly or substantially in issue has been directly or
substantially in issue in a former suit between the same parties, or between parties under whom
they or any of them claim, litigating under the same title, in a Court competent to try such
subsequent suit or the suit in which such issue has been subsequently raised, and has been heard
and finally decided by such Court. The rule of res judicata applies to a case where the suit or
an issue has already been heard and finally decided by a Court. In the case of abandonment or
withdrawal of a suit without the permission of the Court to file a fresh suit, there is no prior
adjudication of a suit or an issue is involved, yet the Code provides, as stated earlier, that a
second suit will not lie in Sub-rule (4) of Rule 1 of Order XXIII of the Code when the first suit
is withdrawn without the permission referred to in Sub-rule (3) in order to prevent the abuse of
the process of the Court.

The question for our consideration is whether it would or would not advance the cause of
justice if the principle underlying Rule 1 of Order XXIII of the Code is adopted in respect
of writ petitions filed under Articles 226/227 of the Constitution of India also. It is common
knowledge that very often after a writ petition is heard for some time when the petitioner or his
counsel finds that the Court is not likely to pass an order admitting the petition, request is made
by the petitioner or by his counsel, to permit the petitioner to withdraw from the writ petition
without seeking permission to institute a fresh writ petition. A Court which is unwilling to
admit the petition would not ordinarily grant liberty to file a fresh petition while it may just
agree to permit the withdrawal of the petition. It is plain that when once a writ petition filed in
a High Court is withdrawn by the petitioner himself he is precluded from filing an appeal
against the order passed in the writ petition because he cannot be considered as a party
aggrieved by the order passed by the High Court.

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K.S. Bhoopathy and Ors. vs. Kokila and Ors. (08.05.2000 - SC) : MANU/SC/0395/2000
withdrawal of suit - Rule 1 (3) of Order 23 of CPC, 1908 - appeal against permission to
withdraw suit and file fresh suit - withdrawal without permission of Court preclude person
from suing on same cause of action - Court's discretion to allow fresh institution of suit has to
be made by considering relevant materials and consequences as to rights of parties - set aside
Order of High Court granting permission to withdraw suit and file fresh suit.

Executive Officer Arthaneswarar Temple v. R. Sathyamoorthy and Ors.[1999] 1 SCR 485

This Court restated the general principles for dealing with the applications under Order XXIII
Rule 1 CPC in the following words:
Various High Courts have rightly held, while dealing with applications under Order 23 Rule 1
CPC, that if an appeal was preferred by an unsuccessful plaintiff against the judgment of the
trial court dismissing the suit and if the appellant-plaintiff wanted to withdraw not only the
appeal but also the suit unconditionally, then such a permission so far as the withdrawal of the
suit was concerned, can be granted if there was no question of any adjudication on merits in
favour of the defendants by the trial being nullified by such withdrawal. On the other hand, if
any such findings by the trial court in favour of the defendant would get nullified, such
permission for withdrawal of the suit should not be granted.

Jet Ply Wood Pvt. Ltd. and Ors. vs. Madhukar Nowlakha (28.02.2006 - SC) :
MANU/SC/8079/2006

Order XXIII Rule 1--Application for withdrawal of suit without leave to file fresh suit - There
is no specific provision in the Code of Civil Procedure for filing application for recalling order
permitting withdrawal of suits - Provisions in Section 151 can be resorted in the interest of
justice.

The inherent powers of the Court to do justice between the parties. There is no doubt in our
minds that in the absence of a specific provision in the Code of Civil Procedure providing for
the filing of an application for recalling of an order permitting withdrawal of a suit, the
provisions of Section 151 of the Code of Civil Procedure can be resorted to in the interest of
justice. The principle is well established that when the Code of Civil Procedure is silent
regarding a procedural aspect, the inherent power of the court can come to its aid to act ex
debito justitiae for doing real and substantial justice between the parties.

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Arunima Baruah vs. Union of India (UOI) and Ors. (27.04.2007 - SC) :
MANU/SC/7366/2007

Appellant filed a suit in the District Court on 28.03.2001. An application was filed for grant of
injunction. On or about 9.04.2001, only a notice to the defendant was issued but no order of
ad-interim injunction was passed. She filed a writ petition before the Delhi High Court on
10.04.2001. Admittedly, in the said writ petition, the fact in regard to pendency of the said suit
was not disclosed. However, before the writ petition came up for preliminary hearing, she filed
an application for withdrawal of the suit on 12.04.2001. The said application allegedly could
not be moved because of the strike resorted to by the lawyers. The writ petition came up for
preliminary hearing on 18.04.2001. A notice was issued therein. Her application to withdraw
the suit dated 12.04.2001 came up for consideration before the Civil Court and upon a statement
made by her, the same was permitted to be withdrawn by an order dated 30.04.2001. The writ
petition, however, was dismissed by a learned Single Judge of the Delhi High Court by an order
dated 29.11.2002, opining:

The petitioner has filed the present writ petition for issuance of a writ of mandamus for
quashing the order dated 19th March, 2001 terminating the services of the petitioner.

Notice was issued in the writ petition.

In the counter affidavit filed by Respondent No. 3, it has been disclosed that the petitioner had
filed a civil suit in the District Court on 28th March, 2001. A photocopy of the civil suit filed
by petitioner for a declaration and permanent injunction is filed with the counter affidavit as
Annexure R3/A. The prayer made in the suit is for a declaration that the order dated 19th March,
2001 is illegal, null and void. An application was also filed for the grant of an ex-parte ad
interim injunction. It appears that no ex-parte ad interim injunction was granted to the petitioner.

However, without disclosing all these facts, the present writ petition was filed on 10th April,
2001. There is not even a whisper in the writ petition about the civil suit. Learned Counsel for
the petitioner does not dispute that such a civil suit was filed. It is stated in the rejoinder
affidavit that a civil suit was subsequently withdrawn but the relevant orders have not been
filed along with the rejoinder affidavit.

In view of gross concealment of fact by the petitioner, it appears that the petitioner is doing
nothing more than forum hunting. Having failed to obtain any injunction in the civil suit, the
Petitioner has resorted to filing the present writ petition.

In view of the conduct of the petitioner and a material concealment of fact, I am not inclined
to entertain the writ petition. The same is, accordingly, dismissed.

Ubi jus ibi remedium is a well known concept. The court while refusing to grant a relief to a
person who comes with a genuine grievance in an arguable case should be given a hearing.
[See Bhagubhai Dhanabhai Khalasi (supra)] In this case, however, the appellant had suppressed
a material fact. It is evident that the writ petition was filed only when no order of interim
injunction was passed. It was obligatory on the part of the appellant to disclose the said fact.

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In this case, however, suppression of filing of the suit is no longer a material fact. The learned
Single Judge and the Division Bench of the High Court may be correct that, in a case of this
nature, the court's jurisdiction may not be invoked but that would not mean that another writ
petition would not lie. When another writ petition is filed disclosing all the facts, the appellant
would be approaching the writ court with a pair of clean hands, the court at that point of time
will be entitled to determine the case on merits having regard to the human right of the appellant
to access to justice and keeping in view the fact that judicial review is a basic feature of the
Constitution of India.

Abdul Rahman vs. Prasony Bai and Ors. (20.11.2002 - SC) : MANU/SC/1026/2002

Code of Civil Procedure, 1908 - Section 24--Withdrawal of suit--Whether High Court has suo
motu power to withdraw suit to itself for disposal from subordinate court?--Held, "yes".

A bare perusal of Section 24, C.P.C., leaves no manner of doubt that the High Court had the
requisite jurisdiction to suo motu withdraw a suit to its file and adjudicate itself all or any of
the issues involved therein.

(2) Code of Civil Procedure, 1908--Section 24 and Order XIV Rule 1--Withdrawal of suit by
High Court to itself--Whether any procedure required to be followed by High Court in
determining issues in suit?--Held, "no" for purposes of disposal of suit on admitted facts,
particularly when suit can be disposed of on preliminary issues.

For the purpose of disposal of the suit on the admitted facts, particularly when the suit can be
disposed of on preliminary issues, no particular procedure was required to be followed by the
High Court. In terms of Order XIV Rule 1 of the Code of Civil Procedure, a civil court can
dispose of a suit on preliminary issues. It is neither in doubt nor in dispute that the issues of res
judicata and/or constructive res judicata as also the maintainability of the suit can be
adjudicated upon as preliminary issues. Such issues, in fact, when facts are admitted, ordinarily
should be decided as preliminary issues.

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Pushpa Devi v. Rajinder Singh MANU/SC/3016/2006 : (2006) 5 SCC 566,

this Court has recognised that the distinction deals with the distinction between the first part
and the second part.

What is the difference between the first part and second part of Rule 3? The first part refers to
situations where an agreement or compromise is entered into in writing and signed by the
parties. The said agreement or compromise is placed before the court. When the court is
satisfied that the suit has been adjusted either wholly or in part by such agreement, or
compromise in writing and signed by the parties and that it is lawful, a decree follows in terms
of what is agreed between the parties. The agreement/compromise spells out the agreed terms
by which the claim is admitted or adjusted by mutual concessions or promises, so that the
parties thereto can be held to their promise(s) in future and performance can be enforced by the
execution of the decree to be passed in terms of it. On the other hand, the second part refers to
cases where the Defendant has satisfied the Plaintiff about the claim. This may be by satisfying
the Plaintiff that his claim cannot be or need not be met or performed. It can also be by
discharging or performing the required obligation. Where the Defendant so 'satisfied' the
Plaintiff in respect of the subject-matter of the suit, nothing further remains to be done or
enforced and there is no question of any 'enforcement' or 'execution' of the decree to be passed
in terms of it.

Further, it is relevant to note the word 'satisfaction' has been used in contradistinction to the
word 'adjustment' by agreement or compromise by the parties. The requirement of 'in writing
and signed by the parties' does not apply to the second part where the Defendant satisfies the
Plaintiff in respect of whole or part of the subject-matter of the suit.

Mahalaxmi Co-operative Housing Society Ltd. and Ors. vs. Ashabhai Atmaram Patel (D)
Th. L.Rs. and Ors. (01.03.2013 - SC) : MANU/SC/0202/2013

The transfer of the suits from one court to another to be tried together will not take away the
right of the parties to invoke Order XXIII Rule 3 and there is also no prohibition under Order
XXIII Rule 3 or Section 24 of the Code of Civil Procedure to record a compromise in one suit.
Suits always retain their independent identity and even after an order of consolidation, the court
is not powerless to dispose of any suit independently once the ingredients of Order XXIII, Rule
3 has been satisfied.

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