Section 10 of the CPC applies to the previous suit, which may be at the stage of appeal, and the decision on various points in question in the previous litigation between the parties pending at the stage of appeal, would operate as res-judicata in the present suit.

( 1 ) THE main question is whether the present suit is liable to be stayed under Section 10, Civil Procedure Code. Plaintiff No. 1 and his wife plaintiff No. 2 filed this suit on 27th November, 1975, for recovery of Rs. 18 lacs by sale of the mortgaged property against Mr. M. R. Dhawan defendant No. 2 and his wife Smt. Satya Dhawan defendant No. 3. The plaintiffs also prayed for a declaration under Order 21, Rule 63 of the Code of Civil Procedure that their right to recover the mortgage-debt from defendants Nos. 2 and 3 takes priority over the right of Union of India defendant No. 1 for recovery of its income-tax dues from Mr. M. R. Dhawan defendant No. 2.

( 2 ) THE property known as 6, Jantar Mantar Road, New Delhi, was purchased on 15th May, 1954 in the name of Smt. Satya Dhawan defendant No. 3 from Seth Jagat Narain. She executed a general power of attorney on 1st May, 1955, in favour of her husband, Mr. M. R. Dhawan defendant No. 2 created an equitable mortgage in consideration of Rs. 13,25,000 in favour of the plaintiffs and deposited the title deeds and the said power of attorney with the plaintiffs by means of a memorandum dated 18th May, 1964. There were some income-tax dues payable by Mr. M. R. Dhawan defendant No. 2 to the Union of India and, therefore, the said property was attached by the income-tax Department on 6th July, 1965.

( 3 ) THE plaintiffs previously filed suit No. 425 of 1966 on 17th December, 1965, for the recovery of Rs. 1,10,000 on the basis of the said equitable mortgage dated 18th May, 1964, against Mr. M. R. Dhawan and his wife Smt. Satya Dhawan on the allegations that they advanced various loans to Mr. Dhawan and his wife Smt. Satya Dhawan and thus a total sum of Rs. 13,25,000 become payable by them to the plaintiffs; that Mr. Dhawan for himself and on behalf of his wife created an equitable mortgage by deposit of title deeds with respect to the said property known as 6, Jantar Mantar Road, New Delhi; that Mr. M. R. Dhawan was real owner of the said property and his wife was a mere benami that Mr. M. R. Dhawan had pledged 61,243 shares of Faridabad Glass Works Private Limited with the plaintiffs prior to the creation of the said equitable mortgage ; that Mr. M. R. Dhawan for himself and on behalf of his wife had to repay the sum of Rs. 13,25,000 by instalments as follows :the first instalment of Rs. 1,00,000 and interest Rs. 10,000 yas not. paid as agreed and, therefore, the plaintiffs filed suit for the recovery of the same by sale of the mortgaged property. Mr. M. R. Dhawan in his written statement of the previous suit admitted that the total sum of Rs. 13,25,000 was due from him to plaintiff No. 1 on account of the loan advanced but denied that he had taken any money from plaintiff No. 2 or that his wife Smt. Satya Dhawan had anything to do with the said loan transactions. Mr. Dhawan further submitted that shares of Faridabad Glass Works Private Limited were pledged with the plaintiffs, that the property known as 6, Jantar Mantar Road. New Delhi was the property of his wife and that he had nothing to do with the said property ; that his wife was real owner of the property, that a general power of attorney was executed in his favour by his wife, and he was authorised to manage, the property for and on behalf of his wife. Admissibility of the agreement dated 18th of May, 1964, purporting to create equitable mortgage by deposit of title deeds was denied for want of registration.

( 4 ) SMT. Satya Dhawan filed a separate written statement in the said previous suit denying any knowledge in connection with any advance by the plaintiffs to her husband and alleging that she was the exclusive owner of the property known as 6, Jantar Mantar Road, New Delhi; that her husband had no authority to mortgage her said property and that she was the real owner of the property and was not a benamidar.

( 5 ) THE Income-tax Department, as already stated, had attached the property known as 6, Jantar M