Bombay High Court
Reliance Enterprise And 2 Ors vs Vivek Mahadeo Mahale And 2 Ors And K. D. ... on 4 January, 2021
Author: A. K. Menon
Bench: A. K. Menon
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
INTERIM APPLICATION (L) NO.3211 OF 2020
IN
SUIT NO. 135 OF 2013
Reliance Enterprise & Ors. .. Applicants/plaintiffs
Vs.
Vivek Mahadeo Mahale & Ors. .. Defendants
And
M/s. K.D. Estate Developers & Ors. .. Respondents.
Mr. Gautam Ankhad a/w Mr. Ashwin Ankhad for the
applicants/plaintiffs.
Mr. Arif Doctor a/w Mr. Bimal Bhabhade i/b. Apte & Co. for defendant
no.1.
Ms. Mehek Bookwala i/b. Laxmi Jessai for respondent nos.2 to 23.
Mr. Anirudh Hariani i/b. Ms. Snehal Marathe for respondent nos.24 to
33.
CORAM : A. K. MENON, J.
DATED : 4TH JANUARY, 2021.
P.C. :
1. By this application, the plaintiffs seek amendment in the cause title of the plaint to join the legal heirs of defendant nos.2 and 3 as additional defendants and to add the respondent no.1 as 1/22 Ial-3211-20 wadhwa plaintiff no.4 and deleting plaintiff nos.1 to 3 thereby substituting the name of present plaintiff nos.1 to 3 with that of the respondent no.1 M/s. K.D. Estate Developers as more partiuclarly set out in Exhibit G to the interim application.
Consequential amendments are also being sought. The application was initially filed by email and is dated 9 th September, 2020. The application is being opposed by defendant no.1, defendant nos.2 to 23 and defendant nos.24 to
33.
2. On 25th November, 2020 the matter was heard via Video Conferencing. The plaintiffs and the contesting defendants submitted that they would file written submissions. On 14 th December, 2020, the learned counsel sought and were granted extension of time to file submissions and stated that they do not wish to make any oral submissions. The respondents who are proposed to be impleaded were also directed to be served with the application. The registry does not appear to have received any submissions from respondent no.1.
3. On behalf of the applicants, it is submitted by Mr. Ankhad that 2/22 Ial-3211-20 wadhwa defendant nos.2 and 3 having expired, it has become necessary to bring the heirs on record. It is their case that the plaintiffs had obtained interim orders dated 21st November, 2012 and 4th April, 2014 and those orders are in force. Defendant nos.2 and 3 passed away on 9th October, 1988 and 13th August, 1991 respectively but this was not known to the plaintiff when the suit was filed. The names of the legal heirs were furnished by Advocate for defendant no.1 some time in December 2012. In March 2014, Chamber Summons bearing (L) no.435 of 2014 was then taken out which came to be rejected under Rule 986 of the Original Side Rules by a self-operative order dated 8 th July, 2014. The plaintiffs did not apply for setting aside the order. The suit later came to be dismissed for want of prosecution on 9th September, 2019. An interim application was taken out on 9th January, 2020 seeking restoration and on 9th March, 2020 the suit was restored.
4. Since the suit was restored, the plaintiffs are seeking to implead the legal heirs. An interim application was filed on 31 st July, 2020 online bearing no.LD/VC/IA/1/2020 seeking restoration of the Chamber Summons (L)no.435 of 2014. Apparently there were errors in the interim application and at the 3/22 Ial-3211-20 wadhwa plaintiffs request the Court permitted withdrawal of that interim application on 31st August, 2020 with liberty to file a fresh application.
5. The plaintiffs apparently sought further information from the defendants Advocates as to whether there was any change in the particulars of legal heirs of defendant nos.2 and 3 furnished by them earlier. The Advocates for defendant no.1 who were unable to contact their clients, stated that particulars known to them had already been furnished in 2014. In these circumstances, the present interim application seeks to bring on record the respondent nos.2 to 23 as defendant nos.2(a) to 2(v) being the legal heirs of original defendant no.2 and to join respondent nos.24 to 33 as defendant nos.3(a) to 3(j) being legal heirs of late defendant no.3.
6. It is further contended that during the pendency of the suit, the plaintiffs 1 to 3 had sold the suit property to defendant no.1 vide a Deed of Conveyance dated 21st July, 2013 which is said to be registered. The plaintiffs contended they could not make this application earlier due to the pandemic but have now filed this present application to complete the necessary pre-trial 4/22 Ial-3211-20 wadhwa formalities. Undoubtedly, there is considerable delay which the plaintiffs recognize, however, they submit that gross and irreparable loss, harm and injury will be caused to the plaintiffs if the reliefs in this application are not granted.
7. The defendant no.1 has filed an affidavit dated 14 th September, 2020 opposing the application. Respondent nos.2, 5, 6, 8, 9, 12 to 18 and 21 have relied upon an affidavit filed by defendant no.6 on their behalf. Respondent no.29 has also filed an affidavit and seeks to oppose the interim application. According to defendant no.1, the plaintiffs have intentionally suppressed the correct facts. When the suit was filed, the plaintiffs had already agreed to sell the property to respondent no.1. The respondent no.1 would have therefore to file an independent suit and cannot be substituted as plaintiff no.4. The Deed of Conveyance in favour of respondent no.1 dated 21st July, 2013 reveals that the agreement to sale had been arrived at in September 2012, monies had also changed hands. The defendant has pressed into service the delay in approaching this Court for the reliefs in this Interim Application and has contended that the plaintiffs are not diligent in prosecuting the suit. The affidavit however admits 5/22 Ial-3211-20 wadhwa of without prejudice negotiations between the defendant no.1 and deponent and admits the fact that respondent no.1 appears to have acquired rights under the Deed of Conveyance dated 21st July, 2013 but the respondent no.1 would have to file a fresh suit to agitate its rights if any. Respondent no.6 in his affidavit has contended that the application is collusive as between the plaintiff and the respondent no.1. He has opposed the application. Respondent no.9 has also sought to oppose the application on grounds similar to that of respondent no.6. It is in this background that I have considered the submissions filed by parties.
8. On behalf of the plaintiffs, it is submitted that the application is liable to be allowed under Rule 10(1) read with Order 22 Rule 10 since there has been a or devolution of interest and transfer of title in the property from plaintiff nos.1 to 3 to proposed plaintiff no.4. It is contended that at the interim stage and in the written submissions, defendant no.1 dated 28 th March, 2020 has stated that they are concerned with the property bearing survey no.120 Hissa no.2B and not the suit property which bears Hissa no.1 and Hissa no.2A. This is recorded in the ad-interim order dated 21st November, 2012 and interim 6/22 Ial-3211-20 wadhwa order dated 4th April, 2014. It is contended that the title of the suit property has devolved on respondent no.1 upon execution of Conveyance dated 21st July 2013 and during the pendency of the suit. Respondent no.1 is vitally interested in the litigation and any orders passed would affect the respondent no.1. The applicants have therefore invoked the courts jurisdiction to permit the amendment. Reliance is placed by the applicants on the following judgments;
1) Amit Kumar Shaw v/s. Farida Khatoon (2005) 11 SCC 403;
2) Shardamma v/s. Mohammed Pyrejan (Dead) through LRs and another (2016) 1 SCC 730;
3) Dhurandhar Prasad Singh v/s. Jai Prakash University (2001) 6 SCC 534;
9. On behalf of defendant no.1, it is contended that the interim application seeks deletion of three original plaintiffs' and substitution of respondent no.1 as the sole plaintiff. The averments in the application are to the effect that the plaintiffs interest has devolved upon respondent no.1 during the pendency of the suit and that the suit be continued by the respondent no.1.
7/22 Ial-3211-20 wadhwa
10. According to the defendant, no application for joinder as a party has been filed by defendant no.1 and therefore this application ought not to be permitted. Order 22 Rule 10 provides that the suit may be continued by order against the person to or upon whom such interest has come or devolved. Reliance is placed on the observations of the Supreme Court in Shardamma (supra) which records that it is at the option of the assignee to move an application for impleadment. Secondly, in the case of Kripal Kaur v/s. Jitender Pal Singh and others (2015) 9 SCC 356 the Supreme Court observed that leave can be obtained by that person upon whom interest has devolved during the pendency of the suit and that the initial duty lies upon the person on whom such an interest has devolved upon any such property must apply for leave. In the case at hand, respondent no.1 had not filed any application therefore the application is misconceived. It is contended that by transfer in favour of respondent no.1 was made during the pendency of the suit but without leave of the court and under Section 52 of the Transfer of Property Act, the subject matter of suit cannot be transferred except under the authority of the Court. 8/22 Ial-3211-20 wadhwa
11. The defendant had contended that the power of attorney of the deponent granted to the deponent is only on behalf of the firm not of the other plaintiffs. Secondly the power of attorney was not in respect of the suit land. The defendant no.1 complained of gross delay and latches on the part of the applicants and the reasons given in the application for delay were far from satisfactory.
12. On behalf of respondent no.2 to 23, the objection that the power of attorney being restricted to plaintiff no.1 has been repeated. Reliance is also placed on decisions of the Supreme Court in Malabar Fisheries Co. v/s. Commissioner of Income Tax, AIR 1980 SC 176, Comptroller and Auditor General v/s. Kamlesh Vadilal Mehta 2003 (2) SCC 349, N. Khadervali Saheb (Dead) by LRs. and another v/s. N. Gudu Sahib (Dead) and others (2003) 3 SCC 229 in support of the plea that partners ought to have signed the power of attorney.
13. It is then contended that under Order 22 Rule 4 of the CPC the applicants/ plaintiffs are required to bring on record the heirs of deceased within time failing which the suit abates. Time had expired and the suit stood abated. It is contended that the 9/22 Ial-3211-20 wadhwa application was time barred since more than 60 days have been gone by from the date of abatement. The first Chamber Summons taken out in 2014 was rejected and this application was filed only on 9th September, 2020 eight years after the plaintiffs became aware that defendant nos.2 and 3 had expired and six years after the Chamber Summons (L) no.435 of 2014 was rejected. Moreover, the relief of setting aside of abatement has not been sought. Lastly, it is contended that there are no reasons for not having filed the application earlier. No case has been made out for condoning gross delay and only relying upon the lockdown is of no consequence in the facts of the case. That no prejudice would be caused to the plaintiffs if the interim application is dismissed, on the other hand, prejudice will be caused to the respondents if it is allowed.
14. On behalf of defendant nos.24 to 28 and 30 to 33 also submissions have been filed. The said defendants have reiterated the objections on the ground of abatement of the suit that the failure to apply for setting aside abatement within time. The bar of limitation has pressed into service as in the case of respondent nos.2 to 23. Lack of reasons for delay in 10/22 Ial-3211-20 wadhwa approaching the Court have also been canvassed. The failure to make out sufficient cause has been emphasized. Reliance is placed on the decision of the Supreme Court in Balwant Singh (Dead) v/s. Jagdish Singh and others (2010) 8 SCC 685 .
15. Having considered all these submissions and the substance of interim application, I am of the view that the application is liable to be allowed reserving the right of the defendants and the respondents agitate the bar of limitation. No doubt, the lack of diligence on the part of the plaintiffs and the first respondent is evident. However, what needs to be considered is whether the respondent no.1 should be added as the plaintiff and whether the suit should be allowed to continue. The amendment sought is a pre-trial amendment. The application seeks amendment in the cause title to implead legal heirs of defendant nos.2 & 3 as additional defendants by inserting paragraph 1(a) after paragraph 1 of the plaint and carrying out consequential amendments, which I am informed includes adding the Deed of Conveyance dated 21 st July, 2013 as an Exhibit. The opposition to the amendment is on the ground of delay and laches, the bar of limitation, the absence of any application by the first respondent, collusion between the 11/22 Ial-3211-20 wadhwa plaintiff and respondent no1 and the bar under Section 52 of the Transfer of Property Act.
16. Primarily it is contended that no case is made out for exercising the jurisdiction vested in this Court under Order 1 Rule 10 and Order 22 Rule10. Order 1 Rule 10 sub-rule (2) empowers the Court to strike out or add parties in order to enable the Court effectively and completely adjudicate upon and settle all the questions involved in the suit and Order 22 Rule 10 deals with the procedure in case of assignment or creation or devolution of any interest during the pendency of the suit and in such cases the suit may after obtaining leave of the Court be continued by or against the person to or upon whom such interest has come or has devolved.
17. It will also be appropriate to consider Section 52 of the Transfer of Property Act which provides that during the pendency of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any 12/22 Ial-3211-20 wadhwa decree or Order which may be made therein, except under the authority of the Court and on such terms as the Court may impose. The aforesaid provisions are material for consideration of the present application. A fair reading of Section 52, the facts at hand, does not act as an absolute bar to the execution of the Deed of Conveyance. It is urged by defendant no.1 and the proposed respondent that an agreement of sale had already been entered into between the plaintiff and respondent no.1 prior to the filing of the suit. The execution of the Deed of Conveyance dated 21 st July, 2013 in the operative portion reveals that as of 25 th September, 2012 i.e. before the filing of the suit, a sum of Rs.1 crore had been paid over towards the first installment of consideration. The balance was payable in two installments first of which, being Rs.4.50 crores was due on 30th November, 2012 and the 2nd installment before 11th February, 2014 that is after filing the suit. The Suit was filed on or about 21st November, 2012.
18. The cause of action is said to have arisen on 12 th November, 2012 when the defendants claimed to be owners of the suit property. In my view, the intention to transfer was evident 13/22 Ial-3211-20 wadhwa from the Deed of Conveyance and as of September 2012 and as early pointed out by the defendant/respondent, an agreement of sale had already been arrived at between the parties. In that view of the matter, I am of the opinion that there will be no express bar under Section 52 of the Transfer of Property Act that can be pressed into service. The only question is whether any terms are to be imposed by the Court while recognizing such transfer but that does not fall for consideration at this stage but only at the final hearing of the suit. It will be open for the defendants to raise this issue in their written statements or in appropriate proceedings if so advised.
19. I have considered the maintainability of the application under the provisions of Order 22 Rule 10. Rule 10 contemplates three different forms under which a party who claims a interest in the property may continue the suit by him or for a plaintiff to continue to suit against such party in whom interest has come or devolved. The interest in such a recipient comes into being either by assignment or some other mode of creation of such interest or by devolution of interest during the pendency of the suit. In the present case it appears that the 14/22 Ial-3211-20 wadhwa respondent no.1 is an assignee and therefore although the applicants have chosen to use the expression of "devolution of interest", the term devolution means an act of transferring rights, duties and powers to another although in legal terms "to devolve" would indicate passing of rights by transmission or succession. Assignment appears to be the mode by which the rights in the property have been transferred thereby creating, prima facie, rights in favour of the first respondent. In the light of the fact that none of the respondents are today in a position to question the fact of assignment and in fact admit that substantial amounts may have been paid over under the Deed of Conveyance, the opposition is largely based on the fact that the first respondent is not applicant herein but it is the original plaintiff who seeks to bring to add the respondent no.1 as a party plaintiff. Rule 10 of Order 22 empowers the Court to grant leave to enable party in whose favour interest has been assigned, created or devolves to continue as a suit and in the instant case such interest is said to have assigned, created and devolved in favour of respondent no.1.
20. In my view, the fact that the application is presented by the 15/22 Ial-3211-20 wadhwa original plaintiffs cannot be seen to be an absolute bar in the facts of the present case. On the aspect of impleadment of legal heirs, the only question to be considered is on the aspect of delay and the fact of abatement of the suit. Setting aside of abatement would necessarily have to be considered while condoning the delay. One important fact of the consideration is avoidance of multiplicity of proceedings and in that light of the matter I am inclined to condone the delay as well and permit the amendment but on terms. Delay is evident from the fact that the suit was presented in 2012 and the ad-interim order came to be passed on 21st November, 2012. On 21st July, 2013 the Deed of Conveyance came to be executed in favour of respondent no.1. This fact is not disputed. On 4 th April, 2014, the defendants in a suit, Court conceded that they are not concerned with the suit property. It is thereafter that the aspect of delay has come to the fore and since the Chamber Summons was taken out on or about 8 th July, 2014 time was granted till 5th August, 2014 to comply with office objections failing which the Chamber Summons was to stand rejected. The pleading indicate that without prejudice negotiations were underway between respondent no.1 and defendant's family members 16/22 Ial-3211-20 wadhwa between February 2018 and February 2019. Meanwhile, the suit came to be dismissed and was subsequently restored pursuant to order dated 9th March, 2020. That order is at Exhibit D to the application. This application has been filed pursuant to liberty granted vide a separate order dated 31 st August, 2020 Exhibit E to the application. Delay has no doubt occasioned. The power to condone delay is wide enough to justify grant of reliefs in this application. The decision in Amit Kumar Shaw (supra) observed that an application under Order 22 Rule 10 can be made also to the Appellate Court even though the devolution of interest occurred when the case was pending in the trial court and no detailed enquiry is contemplated at this stage. Prima facie, I am satisfied that some interest has been created in favour of respondent no.1. Dismissal of the suit cannot be the answer in the facts of the present case and that has been considered in Shardamma (supra) in paragraph 5. Shardamma in fact considered a situation whether assignor was to continue proceedings notwithstanding the fact that he had ceased to have any interest in the subject matter of dispute. It considers a case where the assignee fails to file an application to continue 17/22 Ial-3211-20 wadhwa proceedings and the suit is not liable to be dismissed. These were cases which had arisen post-trial. The Supreme Court observed that if the party does not ask for leave he takes the obvious risk that the suit may not be conducted properly.
21. Dhurandar Prasad Singh (supra) holds that under Order 22 Rule 10 refers a devolution of interest and a suit may proceed with leave of the Court but it is not obligatory that the person claiming agreement or devolution must seek leave. If a party does not ask for leave the interested party takes a chance and the suit may not be conducted properly by the plaintiff on record but would be bound by the result.
22. In the present case, leave to continue the suit is being sought by this application and grant of leave is the only consequence of allowing this application. In paragraph 26 of Dhurandhar Prasad (supra), the Supreme Court observed that the plain language of Rule 10 does not suggest that leave can be sought only by the person on whom interest has devolved. Therefore in the instant case, the original plaintiffs have taken such steps. Dhurandhar Prasad (supra) lays down that even if no steps taken by the assignee, a suit may be continued by the original 18/22 Ial-3211-20 wadhwa plaintiff but the assignee would be bound by the decree unless the decree was based on fraud or collusion.
23. The defendant/respondents have sought to emphasize that even after restoring the suit the application for restoration of the Chamber Summons was once again filed and withdrawn. This alone in my view could not prevent grant of relief in the present application. Reliance placed by the respondents in the observations in Shardamma (supra) that it is at the option of the assignee to move an application for impleadment does not make it mandatory for the respondent no.1 to make the application. Although in Kripal Kaur (supra) the Court observed that it is a rule of prudence the initial duty lies upon a person on whom interest has devolved to apply for leave. In the present case, the respondent no.1 has not done so. The respondent no.1 has not opposed the application and obviously would not be interested in opposing the opportunity to continue the suit in view of the deed of conveyance in its favour.
24. In my view, Kripal Kaur (supra) does not contemplate a prohibition against the application being made by the original 19/22 Ial-3211-20 wadhwa party. In my view, there is no merit in the contention that the suit cannot be continued. I am unable to agree with the contention that the application by the plaintiffs is misconceived. As far as the issue pertaining to the power of attorney is concerned, the firm is duly represented and these are not aspects that will fall for consideration at this interim stage.
25. In Bibi Zubaida Khatoon v/s. Nabi Hassan Saheb and another (2004) 1 SCC 191, the Supreme Court had found that at the trial stage, the alienation did not appear bonafide and the attempt was to transfer so as to complicate and delay the pending suits. The decisions of the Supreme Court cited by the defendants to oppose the application were all post trial. The present case is one of a pre-trial amendment which in my view must be allowed. The objection on the ground that all partners had not filed the application is not something that will be come in the way of amendment being permitted and to that extent, the decisions in the case of M/s. Malabar Fisheries Co. v/s. The Commissioner of IncomeTax, Kerala, AIR 1980 SC 176 (supra) and Controller and Auditor General (supra) will not come to the assistance of the respondents. Furthermore, the interim 20/22 Ial-3211-20 wadhwa orders record that the defendants were not concerned with the plaintiffs claim to the suit property and the plaintiffs continue to rely upon that admission. Whether the power of attorney was to be granted in respect of the land in question or not, is not material at this stage.
26. On the aspect of sufficient cause, the decision of Balwant Singh (supra) does emphasize the fact of taking a very liberal approach should not render provisions of Order 22 Rule 9 (2) and (3) redundant. In my view considering the delay in the instant case, an order of costs would clearly be justified. In the facts of the present case the assignment is not under challenge. The defendants have at the interim stage contended that they have no concern with the suit property.
27. Lastly I may observe that in Perumon Bhagvathy Devaswom v/s. Bhargavi Amma (Dead) Through LRs (2008) 8 SCC 321 the Supreme Court had laid down certain principles to be kept in mind while considering the applications under Order 22. One of these is that while considering reasons of delay, courts are more liberal with reference to application for setting aside 21/22 Ial-3211-20 wadhwa abatement than other cases and will not punish appellant with foreclosure of the appeal for unintended lapses. The Courts tend to set aside abatement and decide the matter on merits, rather than terminate the appeal on the ground of abatement. In the light of the aforesaid I am condoning the delay setting aside the abatement and allowing the application. However, applicant shall be put to terms.
28. In view of the aforesaid I pass the following order;
(i) Interim application is allowed in terms of prayer clauses
(a) to (d) subject to payment of costs of Rs.5000/- each of the defendant no.1 and all the respondents. Plaintiffs are also permitted to annex Exhibits H & I collectively to the plaint.
(ii) Costs to be paid by 2 nd February, 2021. If costs are paid, amendment to be carried out on or before 15th February, 2021.
(ii) Payment of costs shall be condition precedent.
(iv) Registry to issue Writ of summons returnable on 17 th April, 2021.
Digitally signed by Sandhya Sandhya (A. K. MENON, J.) Wadhwa Wadhwa Date:
2021.01.05 11:41:34 +0530 22/22 Ial-3211-20 wadhwa