Rajasthan High Court - Jaipur
Orbital International Ltd. And Anr. vs Rajasthan State Industrial ... on 20 December, 2001
Equivalent citations: 2002(5)WLC619
JUDGMENT Madan, J.
1. The petitioners (M/s. Orbital International Ltd. & its Director & Share Holder Vivek Vasisth) have prefer this petition seeking a writ of mandamus to direct the respondents (Rajasthan State Industrial Development & Investment Corporation Ltd. (RIICO) & Bhiwadi Industrial Development Authority) to transfer the land bearing No. A-1 133, Phase III, Bhiwadi in their favour.
2. Facts though complexed by the parties but are shorn in details are epitomised for the relevance of disposal of this petition. Admittedly M/s. Opera House Exports Ltd. was allotted an industrial plot No. A-1133, measuring 10000 sq. mtrs. in Phase 111 of RIICO industrial Area, Bhiwadi (Rajasthan) (for brevity "the plot") by the respondents on 21.02.1992 and that apart, pursuant thereto, a lease agreement (Ann.A) was executed on 27.03.1995 by respondent No. 1 (for short "RIICO") in favour of M/s Opera House Export Ltd. for the plot. Similarly, M/s. Opera House Export Ltd. admittedly upon its application for transfer of its rights over the plot in favour of its sister concern viz. M/s. Opera House Credit & Holdings Pvt. Ltd., was accorded transfer permission on 30.8.1997 which resulted in transfer of rights over the plot on 02.06.1998 to the transferee Pvt. Ltd. Company subject to the condition that its Promoter/Director Sushil Kumar & his wife or family members shall hold shares in that private Co. to the extent of 51% only.
3. Though the petitioners averred that one Umesh Kapoor was inducted as a Director with 49% shares in transferee Co. (M/s. Opera House Credit & Holding Pvt.
Ltd.), but respondent No. 2 (BIDA) stated in its reply that no information was ever sent to respondent No. 1 (RIICO) as to the induction of Umesh Kapoor in the transferee Co. Similarly it is the case of the petitioners that subsequently name of the transferee Co. stood changed on 03.11.1998 to M/s. Prakunj Textiles Pvt. Ltd. but respondent (RIICO) did not recognise such change in name. However as per reply, it is the case of respondent No. 2 (BIDA) that no Holdings Pvt. Ltd. to Prakunj Textiles Pvt. Ltd. has been approved by respondent (RIICO), rather its approval or transfer as contemplated in RIICO Disposal Rules, 1979. While admitting the receipt of letters dt. 24.8.2000 (Ann.C) & 2.9.2000 (Ann.D) having been sent by M/s. Prakunj Textiles Pvt. Ltd. (changed name of transferee Co.) as to the application for further transfer of the plot ultimately in the name of M/s. Orbital International Ltd. (present petitioner No. 1), respondent No. 2 (BIDA) in reply averred that by letter dt. 2.9.2000, transfer of the plot was sought in the name of the petitioners Co. but in response thereto, by a letter dt. 12.10.2000 (Ann.R1) to S/Shri Sushil Kumar & Umesh Kapoor of the transferee Co. '(M/s Opera House Credit & Holding Pvt. Ltd.) they were directed to personally appear with requisite information mentioned therein.
4. Thus, admittedly Prakunj Textiles Pvt. Ltd. (Formerly Known as Opera House Credit (P) Ltd.) by its letter dt. 2.9.2000 (Ann.D) applied to transfer the plot in dispute under Rule 18(iv)(a) of the RICO Disposal of Land Rules 1979 in favour of its another group company (petitioner No. 1) and further by its letter dt. 2.3.2001 (Ann.E), petitioner (Co.) also requested for such transfer in the favour reiterating the averments made in letter (Ann.D), inter-alia that vide letter dt. 24.8.2000 M/s. Prakunj Textiles informed the RIICO confirming the shareholdings of Mr. Sushil Kumar &his family members. However, as per para (4) of letter dt. 2.3.2001 (Ann.E) it is an admitted position that though on 3.11.98 name of M/s. Opera House Credit & Holdings (P) Ltd. was changed to M/s. Prakunj Textile (P) Ltd. but RIICO till date did not recognise change of name. Hence, this writ petition.
5. RIICO did not file its reply to this petition obviously because it is not disputed that RIICO (respondent No. 1) constituted an Industrial Development Authority at Bhiwadi (respondent No. 2) to decide disputes as to the allotment of land and transfer of the plots and thereby BIDA is the contesting respondent.
6. According to the respondent BIDA in its reply the transfer has not yet been refused rather it is yet pending consideration and stands with held only because of the disputes having arisen in between the Directors and shareholders of the Company itself as they claimed major shares holding in the company inasmuch as an FIR No. 209/2000 came to be lodged at PS Bhiwadi at the instance of Mr. PK Sharma (one of directors of M/s. Opera House Credit (P) Ltd.) against another Director Umesh Kapoor (applicant herein), and even a suit No. 239/2000 has also been instituted before the Delhi High Court by Prakunj Textiles (P) Ltd. and M/s. Kapoor and Sehgal for an injunction against defendant (Sushil Kumar, Shalini Kumar, Atul Dewan and PK Sharma of M/s. Opera House and in that suit, on 13.10.2001 the Delhi-High Court restrained the defendants from transferring, alienating, dealing or creating any third party interest on whatsoever nature in plot in dispute. It is a case of respondent BIDA in its reply that since two groups of promoters have been claiming major share holdings in their favour, the petitioner company was asked by letter dated 30.3.2001 (Ann.R.2/2) to submit latest intimation as to its share holders on the basis of inspection of companies records through an independent Company Secretary so as to take further action, and pursuant thereto, both Sushil Kumar ad Umesh Kapoor had produced certain documents after filing of this writ petition.
7. On 24.5.2001, Umesh Kapoor claiming himself partner of M/s. Kapoor and Saigal Fabrics and Director as authorised signatory of M/s Prakunj Textiles filed an application seeking impleadment of his partnership Firm and Co. (ibid) as respondents to this writ petition interalia asserting that since outstanding of M/s Kapoor and Saigal (applicant No. 1) could not be repaid, 49% shares worth Rs. 3,00,000/- (30,000 shares each of Rs. 10/-) were transferred by M/s. Opera House Credit (P) Ltd. in favour of M/s. Kapoor and Saigal and thereby Umesh Kapoor had 49% share holdings and Shri P.K. Sharma of Opera Group with 51% share capital. It is the case on behalf of applicants Umesh kapoor that upon change in name of the Company to Prankunj Textiles on 3.11.98, Rs. 29.00 lacs as against outstanding of Rs. 52.55 lacs were transferred as share application money in favour of M/s. Kapoor & Saigal, thereby on 31.03.2000, share holding position is claimed as under-
Kapoor & Saigal Fabrics through Umesh Kapoor 16,87,500/-Opera Group 3,12.500/-
8. According to the impleadment application, the applicants are the necessary party because the property belongs to Prankunj Textiles (P) Ltd. and they have never , transferred its property to anybody, inasmuch as before the BIFR, Opera House Exports (P) Ltd. accepted the properties in dispute having been transferred to M/s. Kapoor and Saigal by handing over possession also, and that apart, complete record as to share holding, appointment of Directors besides constitution of Board of Directors have already been submitted before the Registrar of Companies Delhi. The factum of civil suit having been filed be'fore the Delhi High Court against the original Company Opera House Export (P) Ltd., and its Directors and share holders, apart from factum of a stay order having been passed as disclosed by respondent (BIDA) in its reply referred to above, have also been stated in the impleadment application.
9. On the contrary, in its reply to the impleadment application, the petitioners (Co.) specifically contended that Umesh Kapoor has no legal right or authority as having minor shares to raise any objection to such transfer in favour of the petitioners especially when Shri Sushil Kumar, his wife and family member admittedly hold shares in the transferee company (M/s. Opera House Credit (P) Ltd.) to the extent of 51%. The facts stated in the impleadment application as to the transfer of share holding either worth Rs. 3,00,000/- or Rs. 29.00 lacs to Kapoor Group as against any outstanding as share application money, have totally been denied, specifically stating that neither any ' amount on alleged account of share application money was transferred by M/s Prankunj Textiles (P) Ltd. in favour of M/s. Kapoor and Saigal Fabrics nor in favour of Umesh Kapoor and that the alleged transaction of money transfer or shares is noting but a forgery committed by Umesh Kapoor as he3 had no proper authority & resolution and necessary "consent of major share holders/its directors of M/s. Prankunj Textiles (P) Ltd. In reply to the application, all original title deeds, possession letters are denied by the petitioners Co. to have been with Umesh Kapoor and its has been contended that neither the plot in dispute was ever transferred to M/s. Kapoor and Saighal Fabrics nor the possession thereof was ever handed over to it by M/s. Prankunj Textiles (P) Ltd.
10. Even in reply to para 7 of the impleadment application, petitioners (Co.) specifically contended that neither any stay order is in operation as against the transferee Co., RIICO and BIDA nor was there any stay when the transfer of the plot in dispute was applied, nor any of the parties to this writ petition is party to the suit before the Delhi High Court or to the said stay order in collusive litigation at the instance of Umesh Kapoor without making the petitioners Co. or the present respondent as party thereto. No rejoinder to this reply of the impleadment application has been filed by the applicants through Umesh Kapoor.
11. Moreover, an additional affidavit of Vivek Vasisth, petitioner No. 2 as a Director of the Co. (petitioners) has been filed on 4.12.2001 with advance copy given to Mr. Ajeet Bhandari, and a copy of Form 32 has been annexed thereto, showing that PK Sharma is one of the Directors of the petitioner Co. while Form No. 2 has been annexed to show that PK Sharma & Shalini Kumar are holding majority shareholding in the company and out of total fully subscribed shareholding i.e. 1450 shares each of Rs. 10/-, 750 shares are held by PK Sharma (380) and Shalini Kumar (370) with which they are continuing as major share holdings of transferor Co. (Opera House Credit (P) Ltd.) (later changed in name to Prakunj Textiles (P) (Ltd.) so also in the transferee Co. (petitioners).
12. Having heard the learned counsel for the parties and considered their rival contentions besides material on record, once it stands established by the pleadings on record that the applicants are having only minor share holding in the transferee Co. (Opera House Credit (P) Ltd.) and the documents i.e. title deeds/possession letters alleged to have been in possession of Umesh Kapoor, are assigned by the petitioners to be fabricated one for which complaints/FIR have been lodged by the petitioners Co. and for which Umesh Kapoor and his Co. has also raised disputes by instituting civil suit inter-se share holders of Prakunj Textiles (P) Ltd.), but in my considered opinion, this Court has no jurisdiction to adjudicate upon such facts of their rights having been disputed inter-se share holders in these proceedings under extraordinary jurisdiction by way of allowing these applicants to be imploded as party respondents to this writ petition where the controversy is different than raised by the applicants and the issue raised by the petitioners Co. is with regard to its rights to get the plot in dispute, transferred in its favour.
13. Here let me have a brief resume of the principles governing the powers of the court under 0.1 Rule 10 CPC. As a rule the Court should not add a person as a defendant in a suit when the plaintiff is opposed to such addition, obviously because the plaintiff is the dominoes litis. Thus, he cannot be compelled to fight against a person against whom he does not claim any relief. That being so, it is imperative that the courts must invariably take into account the wishes of the plaintiff before adding a third person as a defendant to his suit claiming no relief against such third person. It is trite that while exercising discretion for adding a person to the suit, under 0.1 (2), Rule 10 CPC a person may be added as a party to a suit in two cases only i.e. when he ought to have been joined and is not so joined meaning thereby when he is a necessary party or when without his presence the questions in the suit cannot be completely decided. As held in GDF Luis v. IPS Fernades (1) and Mahadeo Rice Mills v. Chennaimalal (2), a person may not be added as a defendant merely because he would be incidentally affected by the judgment.
14. Thus viewed, in the instant case, the petitioners Co. has sought only relief of transfer in its favour by writ of mandamus against the respondent B1DA which is an authority to do so for transfer of plot in dispute under R1ICO Disposal of Land Rules 1979 and that is why the petitioners Co. did not wish to fight against applicant and against whom it did not claim any relief. The controversy raised and the relief sought for in this petition is as to whether the petitioners Co. is entitled to get transfer f plot in dispute in its favour under the RIICO Disposal of Land Rules 1979 seeking writ of mandamus against the BIDA (respondent). Keeping in view "real controversy" of transfer of plot in dispute, 1 do not find that the applicants are necessary party to this writ petition and without their presence the question in the petition can be completely decided and furthermore in view of the pleadings on record the applicants having minor share holdings have no direct and substantive interest in this petition seeking transfer of the plot in dispute, and that apart, the disputes as to the rights and interest of the applicants on the, basis of title deed or any other documents (which too are disputed and alleged by the petitioners in this petition assigned them to be forged an fabricated) are already pending adjudication in their own suit before the Delhi High Court, where also the present petitioners and the Respondents both are not party to that stay as has not been disputed by filling any rejoinder to their applications reply at the instance of the applicants. The disputed questions of facts as to the right and interest cannot be adjudicated upon in the litigation having limited controversy as to the transfer of disputed land and having been filed by the petitioners Co. and not by the applicants. Entitlement of right of transfer sought in this petitions required to be adjudicated upon and determined under the RIICO Disposal of land Rules 1979, and its Rule 18 provides for transfer of plot and changes in Constitution, according to which the transfer of plots shall not be allowed except in the case provided in Rule 18, itself. Rule I8(ii-a) contemplates that Private Limited Companies converting themselves into a proprietorship concern will be permitted to do so provided sole proprietor had held the majority shares (minimum 51%) in the private limited company. Similarly Rule 18(iv-B) provides that Private Limited Companies converting themselves into partnership firms shall be allowed to do so provided the original directors of the Company hold majority shares (minimum 51%) in the partnership firm. Rule 18(iv-B-1) provides that permission for change of constitution from one private limited company to another Private Limited Company even before start of commercial production will be allowed entire shareholding by the Directors of the Original company in other new company and under explanation to Rule 18(iv-b-1), in cases of Private Limited Companies if the shareholding of the original promoter is diluted below 51% of the total paid up shares capital, it would be deemed to be a transfer of the plot which is not allowed under these rules.
15. The applicant Umesh Kapoor claims himself as partner of a partnership firm M/s. Kapoor & Saigal Fabrics and even as per averments made in para 1 of the impleadment application after transfer of its share to Kapoor Group, i.e. 49% shares, PK Sharma was director with 51% shares whereas Umesh Kapoor as Director with 49% shares. Furthermore, as per latest additional affidavit dt. 4.12.2001 of petitioner No. 2 which remained unrebutted, so also according to Annexures A & B annexed thereto, PK Sharma & Shalini Kumar are holding majority shares in all 750 shares out of total 1450 shares and the rights in the plot in question was transferred on 2.6.98 with the stipulation that promoter/Director Shri Sushil Kumar & his wife or family members shall hold shares in the M/s. Opera House Credit (P) Ltd. Changed Name M/s. Prakunj Textiles Ltd.) to the extent of 53% and at that time also Umesh Kapoor was inducted as a Director with 49% shares only. According to letter dt. 24.8.2000 (Ann.C), Sushil Kumar and his family members holds 100% shares in Prachi Advertising & Marketing Co. (P) Ltd. and vide another letter dt. 2.9.2000 (Ann.D) Prakunj Textiles (P) Ltd. (formerly known as Opera House Credit (P) Ltd. intended to take the plot in dispute in their another group company i.e. petitioners Co. in place of prachi Advertising & Marketing Co.
16. Thus it stands proved rather not disputed in the pleadings on record consisting of writ petition, its reply and impleadment application, its reply duly supported by additional affidavit accompanying with Ann. A&B, that Umesh Kapoor had only minority share holding (49% shares only) as against majority share holding (minimum 51% as provided under Rule 18, ibid) with Sushil Kumar/PK Sharma/Shalini Kumar & their family members in the petitioners' Co. M/s. Orbital International Ltd. so also in M/s. Prakunj Textiles Ltd, and in this view of the matter, the applicants (Umesh Kapoor & its Group Co.) have no legal right to be impleaded as parties being not necessary one to this petition having different controversy then agitated and disputed by them by way of their impleadment application, but the petitioners Co. having, fulfilled the requisites as contemplated under Rule 18, referred to above, of holding majority shares (minimum 51%) and atleast more than 49% which the applicants hold in Prakunj Textiles Ltd., are legally entitled to get the disputed plot transferred in their favour and withholding of transfer at the record in their reply is totally offended to the constitutional mandate which requires to be set at naught by invoking writ jurisdiction in favour of the petitioners' Co. by way of writ of mandamus but subject to the final adjudication of the disputes and rights agitated in the suit or the property rights in the petitioner's Co. being disputed by the parties including the applicants in the competent court of law.
17. As a result of the discussion made above, the application of applicants M/s. Kapoor & Saigal Fabrics and M/s. Prakunj Textiles Pvt. Ltd. filed Under Order 1 Rule 10 CPC for imploding them as party respondents to the writ petition is dismissed. However, the writ petition is allowed. The respondents are directed to transfer a land bearing No. A-1133, phase III, Bhiwadi Rajasthan in favour of the petitioners Company by observing formalities in accordance with relevant rules within a period of three months from the date of receipt of certified copy of this order. However, in the interest of justice, it is made clear that this transfer by the respondents shall be made subject to the final decision of the suit or the property rights in the petitioners' company disputed by the parties including the applicants in the competent court of law. No order as to costs.