Step 1: Application of Res Judicata:
The doctrine of Res Judicata, as per Section 11 of the CPC, applies not only between the same parties in subsequent suits but also between co-plaintiffs and co-defendants when certain conditions are met.
Step 2: Conditions for Application:
Res Judicata applies between co-defendants or co-plaintiffs if:
1. There is a conflict of interest between them.
2. The court has decided that issue.
3. The decision was necessary for the final adjudication of the case.
Step 3: Final Conclusion:
The correct answer is (C) Both (a) & (b), as the principle applies to co-plaintiffs and co-defendants if the above conditions are satisfied.