Gujarat High Court
Kohler vs Atul on 8 March, 2010
Author: R. Tripathi
Bench: Ravi R.Tripathi
Gujarat High Court Case Information System
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SCA/9433/2009 14/ 14 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL
CIVIL APPLICATION No. 9433 of 2009
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KOHLER
CO - THROUGH PRESIDENT GLOBAL POWER GROUP DICK FOTSCH & 1 -
Petitioner(s)
Versus
ATUL
AUTO LIMITED & 1 - Respondent(s)
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Appearance
:
Mr.MIHIR
JOSHI, SENIOR ADVOCATE WITH Mr.S.N. THAKKAR for petitioners.
Mr.KAMAL
TRIVEDI, SENIOR ADVOCATE with Mr.NISHANT LALAKIYA for respondent
no.1,
None for respondent
no.2,
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CORAM
:
HONOURABLE
MR.JUSTICE RAVI R.TRIPATHI
Date
: 08/03/2010
ORAL
ORDER
The petitioners-original defendants no.1 and 2 are before this Court being aggrieved by order impugned dated 24.07.2009 passed below exh.17 in Special Civil Suit No.23 of 2008, by the learned Principal Senior Civil Judge, Gondal at Gondal, whereby the learned Judge dismissed exh.17 filed by defendants no.1 and 2 seeking deletion of defendants no.1 and 2 as defendants in the suit.
The learned Trial Judge was also pleased to dismiss the application, exh.24.
Heard learned senior advocate Mr.Mihir Joshi with learned advocate Mr.S.N. Thakkar for the petitioners; and learned senior advocate Mr.Kamal Trivedi with learned advocate Mr.Nishant Lalakiya for respondent no.1. The learned senior advocate for the petitioners vehemently argued that the learned Judge has committed an error in rejecting the application, exh.17, whereby defendants no.1 and 2 have sought deletion of their names as defendants from the suit. The learned senior advocate for the petitioners invited attention of the Court to various provisions of the Code of Civil Procedure, more particularly, Order I, Rule 10(2) and submitted that the learned Judge has committed an error in exercising discretion conferred by Order I, Sub-rule 2 of Rule 10 of the Code. The learned senior advocate for the petitioners also referred to Order I, Rule 3 of the Code, which provides as to who be joined as defendants. The learned senior advocate for the petitioners also placed reliance on the decision of the Hon'ble the Apex Court in the matter of Ramesh Hirachand Kundanmal Vs. Municipal Corporation of Greater Bombay and others, reported in (1992) 2 SCC 524. The learned senior advocate for the petitioners referred to paras 5, 6, 8, 10 and 14.
The judgement relied upon by the learned senior advocate for the petitioners pertains to addition of necessary parties by the Court and not precisely on the point of deletion of a party which is already added as defendants by the plaintiffs. The learned senior advocate for the petitioners also relied upon a decision of the High Court of Delhi in the matter of TBWA Anthem Private Limited Vs. Madhukar Kamath & another, reported in 2001 AIHC 4692, extract of the same from Manupatra was made available for perusal. The learned senior advocate for the petitioners vehemently submitted that in no uncertain terms it is laid down by the High Court of Delhi that when the question of 'impleadment of parties' arises what is required to be considered is, whether a person who is not a party to the contract, can be impleaded as defendant merely because it is alleged that he has violated business ethics as he was aware of confidential and sensitive information of the business activities of the plaintiff.
At this juncture, the learned senior advocate for the petitioners invited attention of the Court to the plaint of the suit being Special Civil Suit No.23 of 2008 and submitted that except the averments made in para 2 of the plaint, there are no averments which refer to defendants no.1 and 2. The learned senior advocate for the petitioners submitted that besides, there is no averment in the plaint to the effect that defendants no.1 and 2 are responsible for payment of damages which are sought for in the suit on the ground that defendant no.3 has not stood to the promise made by it while supplying diesel engines.
2. The learned senior advocate for the petitioners last but not least referred to and relied upon a decision in the matter of Anil Kumar Singh Vs. Shivnath Mishra Alias Gadasa Guru, reported in (1995) 3 SCC 147. The learned senior advocate for the petitioners submitted that the Hon'ble the Apex Court was pleased to observe that, .. .. Since the respondent is not a party to the agreement of sale, it cannot be said that without his presence the dispute as to specific performance cannot be determined. ..
The learned senior advocate for the petitioners submitted that the Hon'ble the Apex Court was pleased to hold that, .. .. the respondent is neither a necessary nor a proper party to adjudicate upon the dispute arising in the suit so as to render an effective and complete adjudication of the dispute involved in this suit.
The learned senior advocate for the petitioners submitted that as the learned Judge posed a wrong question to himself which is reflected in para 13 of the order, which led him to give a finding on the question as to whether, 'defendants no.1 and 2 are necessary parties'.
The learned advocate fro the petitioners submitted that on reading the order it is clear that the learned Judge was conscious to the question whether defendants no.1 and 2 should be allowed to continue to face trial and whether the plaintiffs should be non suited by allowing exh.17.
In reply to the aforesaid submissions made by the learned senior advocate for the petitioners, learned senior advocate Mr.Kamal B. Trivedi for respondent no.1-plaintiff invited attention of the Court to various paras of the plaint, wherein the plaintiff has referred to the defendants. He submitted that in para 2, the relationship between defendants no.1, 2 and 3 is set out. He vehemently submitted that defendant no.1 is the principal company; of which defendants no.2 and 3 are the subsidiary companies. He submitted that at numerous places the plaintiff has referred to all the defendants, as for example in paras 5, 16, 25 and 26. He submitted that these paragraphs are pointed out only to show that the submission made by the learned senior advocate for the petitioners that the plaintiff has not referred to defendants no.1 and 2 in the entire plaint are not correct. He submitted that if the plaint is perused as a whole, it will be clear that the case of the plaintiff in the plaint is that, it is defendant no.3, who supplied diesel engines to the plaintiff, and the said diesel engines are designed by defendant no.2, whereas defendant no.1 is the principal company of defendants no.2 and 3 both.
Besides, the learned senior counsel for respondent no.1, invited attention of the court to the correspondence, which is produced before the Court below, to substantiate the submission that, 'in almost every meeting which was held with regard to defect which was noticed by the plaintiff in the engines supplied by defendant no.3, designed by defendant no.2, defendants no.1, 2 and 3 all were present'. These meetings were held to find out a solution to the problem. Besides, the correspondence which took place between the parties clearly show that every time, attention of the President of defendant no.1 company was drawn and President of defendant no.1-company participated in the exercise undertaken to find out a solution to the problem which was faced by the plaintiff on account of defective engines.
3. The learned senior advocate for respondent no.1 He submitted that in any case the order passed below exh.17 is a discretionary order and unless this Court comes to a definite conclusion that the discretion is not exercised on a sound footing, the order is not required to be interfered with by this Court. The learned senior counsel for respondent no.1 invited attention of the Court to the fact that, earlier Rule 3 of Order 1 of the CPC stood differently, it came to be amended with effect from 1st February 1977. The learned senior counsel for respondent no.1 strenuously submitted that Rule 3 was amended only with a view to make Rule 3 broader. He submitted that when it says, All persons may be joined in one suit .. ..(a) any right to relief in respect of, or arising out of, the same act or transaction or series of acts or transactions alleged to exist against such persons whether jointly, severally or in alternative :- .. (emphasis supplied) The learned advocate for respondents submitted that if earlier version of Rule 3 is perused, then it will be clear that the Legislature only with a view to enlarge the scope of Rule 3, has amended the same. The object of this amendment is to see that, 'persons like the plaintiff are not non-suited by filing application like exh.17 in the present case. The learned senior counsel for respondent no.1 relied upon a decision of Himachal Pradesh High Court in the matter of State Bank of Patiala Vs. Hypine Carbons Ltd. (In Liquidation) and others, reported in A.I.R. 1990 Himachal Pradesh 10. The learned senior counsel for respondent no.1 invited attention of the court to para 26, wherein the learned Judge of Himachal Pradesh High Court has summarised the basic principles emerging out of a discussion of the decision cited before it. It will be beneficial to reproduce the same for ready reference.
The basic principles which emerge from the discussion made in these decisions are these:
The plaintiff may join, in the same suit, several defendants and causes of action where there is community of interest between the defendants or if the evidence, which was sufficient to enable the plaintiff to get a decree against all the defendants, is the same. There should be some nexus which should enable the plaintiff to join various defendants in one suit. The nexus may take the form of the right to relief which the plaintiff is claiming as flowing from the same transaction or series of transactions involving the various defendants. It may also take the form of the same question of law being involved for decision in the suit upon which may depend the right of the plaintiff to seek relief against all the defendants. The nexus may also be that on a common set of facts the plaintiff may claim relief against the defendants. It is not necessary that all the questions of fact arising in the suit are common to each and every defendant. It would be sufficient if one common question of fact arose. Merely because some additional fact was required to be established in regard to some defendant or the other, which was not common to all of them, it would not mean that the causes of action against the defendants cannot be combined in one suit.
The learned senior counsel for respondent no.1 has also submitted that the decision of the Himachal Pradesh High Court is applicable in the present case, because the question which fall for consideration before that Court was, 'whether a particular party's presence is required for adjudicating the issue raised in the plaint'. He submitted that in the case on hand also the question is 'whether the averments made in the plaint by the present plaintiff can be ascertained in presence of defendants no.1 and 2 or whether the plaintiff will stand non suited with a grant of exh.17 whereby deletion of defendants no.1 and 2 as party defendants is sought for. The learned senior counsel for respondent no.1 next relied upon a decision of the Hon'ble the Apex Court in the matter of Prem Lata Nahata and another Vs. Chandi Prasad Sikaria, reported in (2007) 2 SCC 551. The learned senior counsel for respondent no.1 referred to and relied upon paras 13, 14 and 15 of the said judgement. The Hon'ble the Apex Court has reproduced the relevant part of a decision cited before it, in paras 13 and 14. The same are reproduced for ready reference.
13. After the amendment of Order 16 Rule 1 in England, it was held by the Court of Appeal in England in Thomas V. Moore thus:
Whatever the law may have been at the time when Smurthwaite v. Hannay was decided, joinder of parties and joinder of causes of action are discretionary in this sense, that if they are joined there is no absolute right to have them struck out, but it is discretionary in the Court to do so if it thinks right.
14.They Privy Council in Mahant Ramdhan Puri v. Chaudhury Lachmi Narain pointed out:
It is desirable to point out that under the rules as they now stand the mere fact of misjoinder is not by itself sufficient to entitle the defendant to have the proceedings set aside or action dismissed.
Of course, their Lordshps were speaking in the context of sec.99 of the code. Their Lordships referred to the above quoted observation of the court of Appeal in Thomas v. Moore in that decision. It is therefore clear that a suit that may be bad for misjoinder of causes of action is not one that could be got struck out or rejected by a defendant as a matter of right and the discretion vests with the court either to proceed with the suit or to direct the plaintiff to take steps to rectify the defect. In fact, the Privy Council in that case noticed that the suit was bad for misjoinder of causes of action. It further noticed that the trial Judge had in spite of the complications created thereby, tried and disposed of the suit satisfactorily. Therefore, there was no occasion for the court to dismiss the suit on the ground of misjoinder of causes of action at the appellate stage.
The Hon'ble the Apex Court then discussed the scheme of Orders I and II in para 15. The reproduction of the same will facilitate the appreciation of the observations made by the Hon'ble the Apex Court. Para 15 reads as under:
15. It is well understood that procedure is the handmaid of justice and not its mistress. The scheme of Order 1 and Order 2 clearly sows that the prescriptions therein are in the realm of procedure and not in the realm of substantive law or rights. That the code considers objections regarding the frame of suit or joinder of parties only as procedural, is further clear from sec.99 of the code which specifically provides that no decree shall be reversed in appeal on account of any misjoinder of parties or causes of action or non-joinder of parties unless a court finds that the non joinder is of a necessary party. This is on the same principle as of sec.21 of the code which shows that even an objection to territorial jurisdiction of the court in which the suit is instituted, could not be raised successfully for the first time in an appeal against the decree unless the appellant is also able to show consequent failure of justice. The suits valuation act similarly indicates that absence of pecuniary jurisdiction in the court that tried the cause without objection also stands on the same footing. The amendment to sec.24 of the code in the year 1976 confers power on the court even to transfer a suit filed in a court having no jurisdiction, to a court having jurisdiction to try it. In the context of these provisions with particular reference to the rules in Order 1 and Order 2 of the code, it is clear that an objection of misjoinder of plaintiffs or misjoinder of causes of action, is a procedural objection and it is not a bar to the entertaining of the suit or the trial and final disposal of the suit. The Court has the liberty even to treat the plaint in such a case as relating to two suits and try and dispose them of on that basis.
4. Last but not the least, the learned senior counsel for respondent no.1 referred to a decision of the Hon'ble the Apex Court in the matter of Razia Begum Vs. Sahebzadi Anwar Begum and others, reported in A.I.R. 1958 SC 886. The Hon'ble the Apex Court after considering various aspects of the matter and after recording its conclusions in para 13, finally observed as under in para 14:
Applying the propositions enunciated above to the facts of the instant case, we have come to the conclusion that the courts below did not exceed their power in directing the addition of the respondents 1 and 2 as parties-defendants in the action. Nor can it be said that the exercise of the discretion was not sound. Furthermore, this case comes before us by special leave, and we do not consider that it is a fit case where we should interfere with the exercise of discretion by the courts below. The appeal is accordingly dismissed. As regards the question of costs, we direct that it will abide the ultimate result of the litigation, and will be disposed of by the trial court.
Applying the above proposition in the instant case, namely, .. .. the courts below did not exceed their power in directing the addition of the respondents 1 and 2 as parties-defendants in the action. Nor can it be said that the exercise of the discretion was not sound. Furthermore, this case comes before us by special leave, and we do not consider that it is a fit case where we should interfere with the exercise of discretion by the courts below. The appeal is accordingly dismissed. As regards the question of costs, we direct that it will abide the ultimate result of the litigation, and will be disposed of by the trial court. (emphasis supplied) The learned senior counsel for respondent no.1 submitted that the Hon'ble the Apex Court was considering the legality of the order passed by the courts below, wherein the courts below had exercised the discretion vested in them. The Hon'ble the Apex Court having come to the conclusion that the courts below have exercised the discretion vested in them on a sound footing, held that such exercise of discretion is not required to be interfered with.
5. Last, but not the least, the learned senior counsel for respondent no.1 also relied upon a decision of the Bombay High Court in the matter of Clarinda D;Souza Vs. McCann Erickson India Limited, a copy of the said decision reported in Manupatra is made available for reference. In the said judgement learned Judge of Bombay High Court has succinctly put the scope of taking the order passed by the court below while exercising discretion, in scrutiny, in para 27 of the judgement, which reads as under:
27. However strong and well founded, such a view must necessarily at the stage of such an application be only prima facie. It would therefore, be neither fair nor permissible for the court to presume that the evidence will not establish the case pleaded.
It would be setting an extremely dangerous precedent to strike out the name of a defendant under Order 1, Rule 10(2) on the ground that the plaintiff has no cause of action. I am not unmindful of the fact that while under Order 7, Rule 11(a) the power of the Court to reject the plaint is limited to cases where it does not disclose a cause of action the language or Order 1, Rule 10(2) does not expressly contain any such limitation. However, the effect of such an order is really to dismiss the claim against the defendant without permitting the plaintiff an opportunity of leading evidence to prove his case. It is a power which by virtue of its very nature must be carefully circumscribed. I would exclude from its scope the power of a court to strike out the name of a defendant on the ground that the plaintiff has no cause of action against him.
The learned Judge of the Bombay High Court has very aptly put the scope of interference in an order passed below sub-rule (2) of Rule 10 of Order I of the Code of Civil Procedure, which will have its far reaching repercussions. Taking that into consideration this Court finds that the present Special Civil Application does not warrant interference at the hands of this Court. Hence the order passed below exh.17 does not warrant any disturbance. The petition fails. The same is rejected.
(RAVI R. TRIPATHI, J.) karim Top