Constructive res judicata bars reopening settled writ issues through a subsequent SARFAESI sale notice.

The review petitioners challenged the judgment dated 1 September 2026 in W.A. No. 1560 of 2026, arising from W.P.(C) No. 40284 of 2025, by which the High Court declined to interfere with SARFAESI proceedings initiated by Canara Bank and relegated the petitioners to the remedy before the Debt Recovery Tribunal under Section 17 of the SARFAESI Act.

The petitioners contended that the subsequent writ petition was based on a fresh cause of action arising from the Bank’s auction-sale notice and that, as an MSME, petitioner No. 1 was entitled to the protections under the notification dated 29 May 2015 and the Framework for Revival and Rehabilitation of MSMEs.

They argued that the earlier judgment had erroneously applied res judicata and constructive res judicata, despite the alleged MSME issue not having been adjudicated on merits in the earlier W.P.(C) No. 31231 of 2025.

Whether the judgment dated 1 September 2026 suffered from an error apparent on the face of the record warranting review under Order XLVII Rule 1 CPC, on the ground that res judicata or constructive res judicata had been wrongly applied.

Whether the subsequent writ petition, founded on the SARFAESI sale notice, raised a fresh and legally distinct cause of action so as to avoid the application of constructive res judicata or Order II Rule 2 CPC.

Whether the petitioners’ alleged entitlement to MSME stress-resolution protections, and the absence of an Advisory Committee under the MSME Framework, precluded relegation of the dispute to the Debt Recovery Tribunal.

The Court applied Order XLVII Rule 1 CPC, under which review lies only for an error apparent on the face of the record, and not for re-argument or discovery of an error requiring elaborate investigation.

Relying on A.R. Antulay v. R.S. Nayak, (1988) 2 SCC 602, the Court reiterated that a constitutional court may review an order where it violates constitutional rights, statutory provisions, or natural justice, but the error must be manifest and self-evident.

The Court considered the doctrines of res judicata and constructive res judicata, as well as Order II Rule 2 CPC, in the context of successive writ proceedings and held that a later challenge to consequential action cannot ordinarily reopen an issue already conclusively dealt with on the basis of an efficacious alternative remedy under Section 17 of the SARFAESI Act.

It further relied on State of M.P. v. Ramesh Chandra Bajpai, (2009) 13 SCC 635, and Indusind Media and Communications Ltd. v. Commissioner of Customs, (2019) 17 SCC 108, for the principle that a judgment must be understood in the context of the issues actually decided and that its ratio must be gathered from the facts of the case.

The Court held that the earlier judgment had already considered the relationship between the earlier and subsequent writ proceedings, including the argument that the sale notice constituted a fresh cause of action.

It had concluded that the subsequent reliefs could not be viewed in isolation because they formed part of the continuing original cause of action, and that the petitioners could not reopen the matter merely because the Bank had subsequently issued a sale notice.

The Court also clarified that its earlier reference to finality concerned the scope of interference in writ jurisdiction, rather than a final adjudication of the parties’ substantive merits; the refusal to exercise Article 226 jurisdiction was based on the availability of the statutory remedy before the DRT.

Consequently, the petitioners’ MSME-related contentions, including reliance on the 2015 notification and the Revival and Rehabilitation Framework, did not disclose a patent or self-evident error in the earlier judgment.

The grounds raised required reconsideration of issues already examined and therefore fell outside the narrow scope of review.

It found no error apparent on the face of the record and held that the earlier judgment had adequately considered the alleged fresh cause of action, the applicability of constructive res judicata and Order II Rule 2 CPC, and the availability of the DRT remedy under Section 17 of the SARFAESI Act.

The review petition was accordingly dismissed, with no order as to costs.