STATE OF MAHARASHTRA vs NATIONAL CONSTRN.CO BOMBAY

The Supreme Court addressed the issue of res judicata under Section 11, Explanation IV of the Civil Procedure Code, 1908, holding that the dismissal of a prior suit does not bar a subsequent suit if based on a different cause of action. The Court clarified that the appellants' claim against the Central Bank of India under the performance guarantee was valid, as the suit was filed before the guarantee lapsed. The Court ultimately upheld the appeal, allowing the appellants to pursue their claim against the Bank for the amount stipulated in the performance guarantee.