Gujarat High Court
Saurashtra vs State on 12 August, 2010
Author: H.K.Rathod
Bench: H.K.Rathod
Gujarat High Court Case Information System
Print
SCA/8009/2010 55/ 56 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL
CIVIL APPLICATION No. 8009 of 2010
For
Approval and Signature:
HONOURABLE
MR.JUSTICE H.K.RATHOD Sd/-
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1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
YES
2
To be
referred to the Reporter or not ? YES
3
Whether
their Lordships wish to see the fair copy of the judgment ?
YES
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ? NO
5
Whether
it is to be circulated to the civil judge ?
NO
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SAURASHTRA
FUELS(P) LTD MAHA SHAKTI COKE - Petitioner(s)
Versus
STATE
OF GUJARAT THRO. SECRETARY & 2 - Respondent(s)
=========================================================
Appearance
:
M/S
THAKKAR ASSOC. for
Petitioner(s) : 1,
MS JIRGA JHAVERI, AGP for Respondent(s) :
1,
NOTICE SERVED for Respondent(s) : 1 -
3.
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE H.K.RATHOD
Date
: 12/08/2010
CAV
JUDGMENT
1. Heard learned Senior Advocate Mr. P.M. Thakkar with learned advocate Mr. N.K. Pahwa for M/s. Thakkar Associates for petitioner and learned AGP Ms. Jirga Jhavari of respondent State Authority.
2. The draft amendment is placed on record by learned Senior Advocate Mr. Thakkar on 4th August 2010 and copy thereof is supplied to learned AGP Ms. Jhaveri on 4th August 2010. On 5th August 2010, learned Senior Advocate Mr. Thakkar submitted that petitioner is pressing draft amendment which has been objected by respondent State Authority. Thereafter, matter has been adjourned for filing affidavit-in-reply on behalf of respondent State Authority in respect to draft amendment only. In this view, affidavit in reply on behalf of respondent No.2 is filed on 9th August 2010 and copy thereof is served to petitioner on 9th August 2010 at 04:45 pm., by respondent - State Authority.
3. Accordingly, the matter was heard on 10th August 2010 to decide whether draft amendment which is placed on record by petitioner on 4th August 2010 is to be granted or not ? And thereafter, matter was reserved by this Court for orders.
4. Learned Senior Advocate Mr. P.M. Thakkar, in detail, made his submissions before this Court pointing out almost merits of the matter. He referred Page 25 a letter of Gujarat Water Infrastructure Limited, Annexure-B, dated 8th February 2005. According to him, the water connection approval for 0.75 MLD is granted for petitioner Company at Village Lakhapar, Tal. Mundra, District Kachchh vide letter dated 29th July 2004, for which, petitioner has to deposit Rs.40.50 lakhs. The petitioner has requested by letter dated 13th December 2004 to respondent for revised requirement of raw water of 5 MLD for its Unit situated in Kachchh District, which has been granted. The drawl of water is from the connection of bulk water transmission main line Anjar-Mundra-Mandvi line. He submitted that initially, tentative rate of Rs.15/- (Rupees fifteen only) per 1000 liters has been fixed.
5. Learned Senior Advocate Mr. Thakkar also referred Page 26, Item No.6 and submitted that six months water charges of Rs.135 lakhs shall have to be paid in advance and out of that, Rs.40.50 lakhs has been paid and subsequently balance of Rs.94.50 lakhs has also been paid, which amount is lying with respondent. He submitted that agreement is arrived at between parties on 17th August 2005 in supercessation to earlier agreement dated 5th October 2004. He also submitted that prior to this agreement (Page 53), on 31st March 2005, application was made by petitioner to Range Forest Officer, Mundra for obtaining approval for FCA clearance for installation of water pipeline in forest protected land. He submitted that for approval, it requires permission from Central Government which rotated from State Government under Section 2(ii) of the Forest (Conservation) Act, 1980, it provides for restriction on the dereservation of forests or use of forest land for non-forest purpose, prior approval of Central Government is necessary if any forest land or any portion thereof may be used for any non-forest purpose.
6. Thereafter, learned Senior Advocate Mr. Thakkar referred page 59 and submitted that Central Government has given permission by letter dated 30th June 2006 addressed to the Principal Secretary, Government of Gujarat, Forest and Environment Department on certain conditions in respect to giving approval for diversion of 0.24 hector of protected forest land for laying water pipeline parallel to SH-98, at Lakhpar, Tal. Mundra in favour of Maha Shakti Coke (A Unit of Saurashtra Fuels Pvt. Ltd.) in Kachchh District. He submitted that in respect to application made by petitioner to Range Forest Officer on 31st May 2005, State Government has also approached Central Government by application dated 19th May 2006 which has been considered and approval was granted by Central Government as above vide letter dated 30th June 2006.
7. Thereafter, learned Senior Advocate Mr. Thakkar referred Page 63, a letter written by Maha Shakti Coke (A Unit of Saurashtra Fuels (P) Ltd.) dated 16th January 2007 to Senior Manager, Gujarat Water Infrastructure Limited, Anjar (Kachchh), with a request to grant water connection as work of installation of pipe line is over. Thereafter, on 31st January 2007 (Page 64), General Manager (Civil), Gujarat Water Infrastructure Limited had written a letter to Senior Manager (Civil), GWIL, Anjar, wherein, it has been made clear that with reference to Agreement dated 17th August 2005 as well as Letter dated 30th January 2007, start water to M/s. Maha Shakti Coke, Mundra and immediate action is requested as per orders given by Chief General Manager (Civil) on file.
8. Thereafter, learned Senior Advocate Mr. Thakkar referred Page 27 and pointed out that Agreement dated 17th August 2005 is in supercessation to earlier agreement dated 5th October 2004.
9. Thereafter, learned Senior Advocate Mr. Thakkar referred Clause 5 - Obligation of the Purchaser and also referred Clause 5.6, therefore, Clause 5.6 is quoted as under :
Clause 5.6 - Subject to Clause 13.4 hereof, the Purchaser shall pay for the minimum quantity of water specified in Clause 3.2 irrespective of the consumption or non-consumption of the said amount of water by the Purchaser.
10. Thereafter, he referred Page 47 Method of sale of water to be supplied to petitioner by respondent.
11. He also emphasised Page 33, Clause 5.2 that the Purchaser shall obtain its final compliance certificate from the bulk supplier in accordance with the procedures set out in Annexure-A within 90 days from the effective date.
12. Learned Senior Advocate Mr. Thakkar also referred Clause 11 Joint Obligations (Page 37), the same is quoted as under :
Clause 11.1 Each party shall cooperate and liaise fully with the other party to ensure that this agreement is implemented effectively.
Clause 11.2 Each party shall comply with all laws relevant to the subject matter of this agreement.
Clause 11.3 The parties, may, from time to time through their authorised representatives, agree upon an adopt written protocol for the performance by either or both the parties of any obligation under this agreement. However, to the extent of any inconsistency between them, the provisions of this agreement shall at all times prevail over any protocol adopted.
Clause 11.4 The party shall liaise fully, inter alia
(i) to resolve any difficulties which may arise in implementing this agreement because of any legal and/or regulatory right or obligation of a party which may conflict with this agreement.
(ii) to allow each party to comply with its statutory and contractual rights and obligations to other persons, and
(iii) to minimize any risks to persons, equipment or the environment which may arise in supplying water under this agreement.
13. Learned Senior Advocate Mr. Thakkar referred Item No.3 - Final Compliance Certificate and Commencement of the Water Supply, Sub Clause (i) (Page 48) and submitted that it is an obligation upon Bulk Supplier who shall have to issue a Final Compliance Certificate to the Purchaser, after the successful completion of the stream lining tests. He submitted that this certificate is not supplied by respondent. He also referred Clause 3(ii) and submitted that supply of water by Bulk Supplier to Purchaser shall start one (1) day after issuance of Final Compliance Certificate.
14. According to him, no Final Compliance Certificate has been issued by respondent and therefore, there cannot be any supply in this pipeline which has been installed by petitioner and pipeline cannot be installed by petitioner without prior permission from Central Government as referred above.
15. He submitted that from the date, on which, actual water has been received from respondent i.e. w.e.f. 1st February 2007 and water is being supplied by respondent Nos.2 and 3 regularly to petitioner without any claim whatsoever since then. His submission is that w.e.f. 1st February 2007, regular payment has been made by petitioner to respondents. He also emphasized that there is a vast difference between consumption and supply, so long, consumption is not made by petitioner, question of any payment to respondent does not arise. Therefore, he challenged Item No.5.6 (Page 33) that it being an arbitrary, malafide and unreasonable, therefore, according to him, reasonable interpretation is that petitioner is required to make payment after consumption of water not merely based on condition incorporated in Item No.5.6 (Page 33).
16. He also submitted that as per letter dated 31st January 2007 (Page 64), petitioner received water from respondent and thereafter, water charges have been paid regularly by petitioner to respondent w.e.f. 1st February 2007.
17. He also submitted that prior to letter dated 31st January, 2007 (Page 64), question of supplying water by respondent does not arise, because, Item No.5.6 (Page 33) operates only when petitioner is able to have consumption of water after installing pipeline. So, in absence of water supply from respondent, consumption cannot be made by petitioner.
18. In short, his submission is that Item No.5.6 (Page 33) is arbitrary and unreasonable condition incorporated by respondent in agreement dated 17th August 2005, therefore, same condition is challenged by petitioner in draft amendment which can be considered to be an additional challenge of petitioner and respondent having no authority to incorporate such condition in agreement arrived at between the parties on 17th August 2005, therefore, draft amendment is placed on record challenging Item No.5.6 as referred above by petitioner.
19. Except that, no other submission is made by learned Senior Advocate Mr. P.M. Thakkar appearing on behalf of petitioner before this Court today.
20. Learned AGP Ms. Jirga Jhaveri opposing draft amendment filed by petitioner on 4th August 2010 and affidavit in reply filed by respondent No.2. She Submitted that because of draft amendment dated 4th August 2010, it entirely changes the nature and character of petition and therefore, such amendment cannot be granted and it amounts to a disputed question of facts and for that, petitioner is having Clause 17 Dispute Resolution (Page 42) of agreement for dispute resolution and if any dispute in respect to agreement or any condition thereof, petitioner shall have to resolve it after following procedure prescribed in agreement, therefore, direct writ petition under Article 226 of the Constitution of India in respect to disputed question of facts is not maintainable. She also submitted that there is no undue influence and no coercive method has been adopted by respondent and such issue requires evidence which cannot be based on mere presumption and therefore, she submitted that draft amendment is amounting to withdrawing earlier admission in respect to agreement dated 17th August 2005 which is binding to petitioner, now, by way of draft amendment, it is going to change the very nature and character which causes great prejudice to the right of respective respondents. She submitted that it is not a bonafide draft amendment. Therefore, Hon ble Court may not entertain or allow such draft amendment placed on record by petitioner.
21. I have considered submissions made by both learned advocates. I have scanned the entire papers with draft amendment placed by petitioner and I have also scanned the Affidavit-in-Reply filed by respondent No.2 (Page 76). The question is that in petition, nowhere, petitioner has challenged Item No.5.6 (Page 33). The entire petition based on accepting each terms of agreement dated 17th August 2005 and none of the condition was under challenge in present petition. The petitioner has fully accepted the agreement dated 17th August 2005 with all incorporated conditions and only challenge was before this Court is as per prayer made in Para 9(A) to 9(C), which are quoted as under :
9(A) Your Lordships may be pleased to issue an appropriate writ, order or direction, quashing and setting aside the impugned communications dated 07.04.2010 and 09.07.2010 issued on behalf of respondent No.2 and disconnecting the water supply to the Unit of the petitioner as being illegal, unreasonable, arbitrary and violative of Articles 14 and 19(1)(g) of the Constitution of India;
9(B) Your Lordships may be pleased to direct the respondents to forthwith restore/resumption of water supply to the petitioner, pending the admission, hearing and final disposal of this petition;
9(C) Your Lordships may be pleased to pass such other and further order as the nature and circumstances of the case may be required.
22. The petitioner has challenged action or communication dated 7th April 2010 and 9th July 2010 issued by respondent No.2 and disconnecting the water supply to the Unit of petitioner as being illegal, unreasonable and arbitrary and violative of Articles 14 and 19(1)(g) of the Constitution of India. I have gone through entire petition with earlier draft amendment which was carried out as per Court s order dated 22nd July 2010. Nowhere, such challenge was made by petitioner in present petition. The respondent has filed reply (Page 67) dated 28th July 2010, where, following contentions have been raised by respondent in its reply. The relevant are made in Para 4 to 13, which are quoted as under :
4. I humbly say and submit that none of the fundamental or legal right of the applicant has been violated because of any action or inaction on the part of the present respondent and therefore, the present application is not maintainable in law and the same deserves to be dismissed in limine.
5. I humbly say and submit that my non dealing with the petition parawise may not be construed as admission on my part.
6. I humbly say and submit that the petitioner company M/s. Mahashakti Coke entered into three Water sales agreements with Gujarat Water Infrastructure Ltd.
(1) On dated 25.08.2004 for 0.225 MLD minimum & 0.75 MLD Maximum.
(2) On dated 05.10.2004 for 0.45 MLD minimum & 1.50 MLD Maximum.
(3) On dated 17.08.2005 for 1.50 MLD minimum & 5.00 MLD Maximum.
7. I humbly say and submit that, as per the agreement dated 07.08.2005 between M/s. Mahashakti Coke and Gujarat Water Infrastructure Ltd. There is a Clause No.5.6 which mentioned that Purchaser Company has to pay for minimum quantity of water as specified in Clause 3.2 irrespective of the consumption or non-consumption of the said amount of water.
8. It is humbly submitted that, as per the Clause No.8.2 of the agreement if the purchaser fails to make payment within 14 days from the date of invoice, purchaser shall have to pay penalty equal to interest at the rate of 15% per annum from the due dated until the date on which the bulk supplier receives the payment. It is humbly submitted that, agreement of Gujarat Water Infrastructure Company is dated 25.08.2004 for 0.225 MLD minimum and 0.75 MLD maximum. After period of 7 months petitioner company applied for Forest Department clearance on 31.03.2005 which is fault of petitioner company. It is humbly submitted that no assurance has been given by the supplier company at any point of time to the petitioner as alleged in the memo of the petition.
As per the agreement dated 17.08.2005 Clause-17 mentioned about arbitrator for disputes resolution for amicable resolution. Even as on today petitioner company has not lodge any dispute against the respondent Gujarat Water Infrastructure Ltd. Therefore, petition is not maintainable without raising any objection against the respondent for any disputes.
9. It is humbly submitted that the purchaser has been informed for payment by letter dated 19.07.2006. If then after 09.01.2008, 06.02.2008, 05.03.2008, 12.04.2010 from Anjar office and 22.04.2010, 09.07.2010 from the Head Office. Copy of the letters are attached herewith and marked as Annexure R-I to this affidavit in reply.
10. It is humbly submitted that the Forest Department has given clearance of the petitioner company vide letter dated 30.06.2006. However, without clearance from the Forest Department purchaser has applied thrice and entered into the agreement that Gujarat Water Infrastructure Ltd. Therefore, Clause 5.6 of agreement dated 17.08.2005 is applicable.
11. It is humbly submitted that the Gujarat Water Infrastructure Ltd., was having the ready for supply of Water from day one and from date of first agreement purchaser is drawing water since 01.02.2007.
12. It is humbly submitted that the despite of issuance of several notices for making petitioner company has failed to make any payment. Therefore, connection was discontinued from 07.07.2010. A copy of communication is annexed herewith and marked as Annexure R-II to this affidavit.
13. It is humbly submitted that, as per the Clause No.5.6 of the agreement the purchaser shall pay for the minimum quantity of water as shown I Clause 3.2 of the agreement irrespective of the consumption or non-consumption of water. Also, there is a provision for penalty in Clause No.8.2 of the water sale agreement, the purchaser shall have to pay penalty equal to interest at the rate of 15% per annum from the payment due date until the date on which the payment is received.
23. In view of aforesaid reply submitted by respondent, where, in Para 7, specific contention was raised by respondent that there is a Clause No.5.6 which mentioned that Purchaser Company has to pay for minimum quantity of water as specified in Clause 3.2 irrespective of the consumption or non-consumption of said amount of water.
24. In light of aforesaid contentions raised by respondent in Affidavit-in-Reply as referred above, it is necessary to note that petitioner has not filed any rejoinder against present reply as referred above. Instead of filing rejoinder, straightway, very Clause or Item or Condition 5.6 which has been relied upon by respondent as per agreement dated 17th August 2005, now, petitioner wants to challenge it by way of draft amendment and Para 1 and 2 of draft amendment is quoted as under :
1. The petitioner begs to amend the memo of petition by adding following paragraphs as under :
3.24 The petitioner submits that Clause 5.6 r/w. Clause 3.2 of the Agreement dated 17.08.2005 (Ann-C) is unfair, unreasonable, unconscionable and thus, bad in law. This term is also violative of Article 14 of Constitution of India and is thus liable to be struck down.
3.25 The petitioner submits that Clause 5.6 stipulate as under :
Subject to Clause 13.4 hereof, the Purchaser shall pay for the minimum quantity of water specified in Clause No.3.2 irrespective of the consumption or non-consumption of the said amount of water by the Purchaser.
The petitioner submits that the parties are required to install certain infrastructure for the purpose of supply of water from the transfer point to the Unit of the petitioner. The petitioner submits that between the transfer point and the unit of the petitioner here is an area of 3.5 kms., which is part of forest area. Accordingly, approval of central government through the State Government is required to be obtained as per the provision of Sec.2 of the Forest (Conservation) Act, 1980.
3.26 The petitioner submits that the petitioner thus made an application for getting necessary approval to the Forest Officer vide application dated 31.03.2005 which is even before executing the agreement dated 17.08.2005. The said application came to be routed through the State Government and Central Government granted its approval vide letter dated 30.06.2006 addressed to the State Government. The petitioner submits that only after the aforesaid approval came to be received that the infrastructure required for supply of water could be installed. Immediately after installation, request was made to start the supplied and the supply of water started w.e.f. 01.02.2007.
3.27 The petitioner submits that the Clause 5.6 of the Agreement which stipulate making payment for the minimum quantity of water irrespective of consumption is completely unfair and unreasonable. As stated hereinabove, the petitioner could not install the infrastructure because of non-receipt of approval from the Central Government. The approval as such was required to be obtained by the State Government as per the provision of Sec.2 of the Forest (Conservation) Act which approval admittedly came to be received only on 30.06.2006. The Clause 5.6 is absolute and uncanalized. The term also ignored the requirement of obtaining approvals from the Competent Authority more particularly under the Forest Act.
The term seeks to compel the Purchaser to accept supplied of water which means installment of infrastructure without waiting for the approval under the Forest Act which is an offence as provided in Sec.3 B of the Forest Act. The term therefore is also opposed to public policy and is thus void as per Sec.23 of the Contract Act. The clause is also arbitrary as it gives unfettered and absolute powers to recover this amount irrespective of whether approvals are obtained or not and whether water is consumed or not. The clause is therefore also violative of Article 14 of the Constitution of India.
3.28 The petitioner submits that the respondents have monopoly in the matter of supply of Narmada water. The petitioner has no other source of water supply to the extent required for its industry. The petitioner thus has been compelled to sign the agreement though the terms of the contract as above stated are unfair, unreasonable and unconscionable. The petitioner submits that the respondent State is on stronger position as compared to the petitioner and therefore, the parties to the contract were not at equal terms and equal status when the agreement was signed. The respondents had prepared the agreement and embodied terms which on face of it are conscionable, unfair and unreasonable. The petitioner submits that it is settled principles of law that the contracts where the bargaining power is unequal and that the contracts are not negotiated, the contracts can be questioned in writ jurisdiction more particularly when the superior party is a public authority. The petitioner submits that considering fact that the respondents have monopoly in matter of supply of bulk water to the industry of the petitioner, the petitioner had no option but the sign the contract on dotted lines though the terms on the face of it are arbitrary and unreasonable. The petitioner was under undue influence of the respondent authorities considering their superior status having monopoly in the matter of supply of water to the industry. The agreement therefore is also void in view of the provision of Sec.19 of the Contract Act. The petitioner submits that the petitioner had no choice but to accept the arbitrary and unreasonable terms stipulated by the respondent without any negotiation.
3.29 The petitioner submits that considering the above facts and circumstances, it is clear that Clause 5.6 of the Agreement dated 17.08.2005 is unfair, unreasonable and arbitrary. The term is also violative of Article 14 of the Constitution of India and is, thus, liable to be struck down.
2. The petitioner begs to insert the following paragraphs in the prayer clause :
9AA Your Lordships may please to issue an appropriate writ, order or direction quashing and setting aside the Clause 5.6 of the Agreement dated 17.08.2005 as being unfair, unreasonable and unconscionable and thus violative of Article 14 of the Constitution of India.
25. In view of aforesaid draft amendment placed on record by petitioner on 4th August 2010, Affidavit-in-Reply is filed by respondent No.2 Gujarat Water Infrastructure Limited (Page 76). Para 3 to Para 8 of the said Affidavit-in-Reply are quoted as under :
3. I humbly say and submit that, by way of this amendment petitioner seeking relief of canceling terms of agreement which was already agreed by petitioner in the year 2005 without under any protest or under any coarsen. Therefore, petitioner is not entitled to challenge the terms and agreement at the belated stage in the year 2010. Which is nothing but negative reaction to disconnection of water for non-payment of past dues.
4. I humbly say and submit that with reference to Para 2.24, it is submitted that Clause 5.6 reading with Clause 3.2 of the Agreement, dated 17.08.2005 is just and proper as per the terms of the agreement petitioner is liable to make payment for minimum billing amount. There is not question of Article 14 in a commercial transaction entered into by the parties in agreement.
5. With reference to Para 3.25, I humbly say and submit that, from day one respondent infrastructure was ready to provide water in Mahashakti Coke Industries after the first agreement entered into by the parties. Therefore, respondents are not at fault for any delay. Referring to Clause 5.1 and 5.4, the purchaser is responsible for obtaining all permissions and/or approvals. Even otherwise, terms agreed between the parties are without any force, coarsen.
6. With reference to the Para 3.26 and 3.27, I humbly say and submit that even though permissions and/or approvals to be obtained by petitioner, petitioner had made first agreement on dated 25.08.2004 and second agreement on dated 05.10.2004 and applied to Forest Department for permission after almost seven months and after receiving permission from Forest Department communicated regarding readiness to take water after six and half months.
7. With reference to Para 3.28, it is humbly submitted that there is no coarsen and compelling situation or any threat in which petitioner had to sign the agreement which is accepted by the petitioner for a period of 5 years and challenged is mae in the year 2010. Which is doubting the bonafides of petitioner.
8. With reference to Para 3.29, it is humbly submitted that, considering the above facts and circumstances, it is denied that Clause 5.6 of the agreement dated 17.08.2010 is unfair, unreasonable and arbitrary. It is also denied that the terms is also violative of Article 14 of the Constitution of India and is, thus, liable to be struck down. Other contentions raised in this para are not correct, hence, denied.
26. In light of aforesaid pleadings between parties and considering undisputed facts based on pleadings of petition, nowhere, such challenge was made by petitioner which incorporated in Draft Amendment dated 4th August 2010.
27. The petition is filed by petitioner accepting entire agreement dated 17th August 2005 and none of the conditions has been challenged or disputed by petitioner in present petition. Now, by placing Draft Amendment on record, requested this Court to permit the petitioner and allow Draft Amendment, then, according to my opinion, entire nature and character of petition seems to be changed. The said Draft Amendment changed the colour of entire petition and admissions made by petitioner in petition not challenging agreement or any condition incorporated in Agreement dated 17th August 2005, now, petitioner wants to get rid of such admissions made in petition and cause of action, and the basis on which petition was filed, is also changed and entirely different case has been put up by petitioner on the basis of draft amendment dated 4th August 2010. Such admission made in the petition is not disputing and not disputing agreement dated 17th August 2005 no any condition thereof has been challenged, now, by such Draft Amendment, petitioner wants to withdraw such admission accepting agreement as a whole being a binding to petitioner, such withdrawal from earlier admission made in pleadings of petition, amounts to totally displacing the defence of respondent. In main petition, the real question for determination was whether communication dated 7th April 2010 and 9th July 2010 is legal and valid or not and whether it violates Articles 14 and 19(1)(g) of the Constitution of India or not. Such challenge made in Draft Amendment cannot be permitted, otherwise, it causes such prejudice to other side which cannot be compensated adequately in terms of money. Therefore, according to my opinion, such Draft Amendment constitutionally or fundamentally changed the nature and character as well as colour of the petition. Such challenge has been made by petitioner in Draft Amendment, because, a specific contention raised in reply by respondent relying upon Item No.5.6 as per Agreement dated 17th August 2005 as referred in Para 7 of Affidavit-in-Reply (Page 69) of respondent.
28. In light of this background, question is whether Draft Amendment can be allowed or not in pending petition or in pending suit as analogues principle is applicable as per Order VI, Rule 17 of the Code of Civil Procedure to writ proceedings. The same has been decided by Apex Court in case of Bharat Karsondas Thakkar versus M/s. Kiran Construction Co. & Ors.
reported in AIR 2008 Supreme Court 2134.
The relevant Para 21 is quoted as under :
21. Having carefully considered the submissions made on behalf of the respective parties, and the decisions cited on their behalf, we are of the view that the Division Bench of the High Court erred in law in allowing the amendment of the plaint sought for by the respondent No.1 herein as the plaintiff in the suit. Even if the bar of limitation is not taken into account, the plaintiff, namely, the respondent No.1 herein, is faced with the ominous question as to whether the amendment of the pleadings could have at all been allowed by the High Court since it completely changed the nature and character of the suit from being a suit for specific performance of an agreement to one for declaration of title and possession followed by a prayer for specific performance of an agreement of sale entered into between its assignee and the vendors of the assignees. Along with that is the other question, which very often raises its head in suits for specific performance, that is, whether a stranger to an agreement for sale can be added as a party in a suit for specific performance of an agreement for sale in view of Section 15 of the Specific Relief Act, 1963. The relevant provision of Section 15 with which we are concerned is contained in clause (a) thereof and entitles any party to the contract to seek specific performance of such contract.
Admittedly, the appellant herein is a third party to the agreement and does not, therefore, fall within the category of "parties to the agreement". The appellant also does not come within the ambit of Section 19 of the said Act, which provides for relief against parties and persons claiming under them by subsequent title. This aspect of the matter has been dealt with in detail in Kasturi's case (supra). While holding that the scope of a suit for specific performance could not be enlarged to convert the same into a suit for title and possession, Their Lordships observed that a third party or a stranger to the contract could not be added so as to convert a suit of one character into a suit of a different character.
29. The same issue has been discussed by Apex Court in case of P.A. Jayalakshmi Versus H. Saradha & Ors. reported in JT 2009 (13) Supreme Court Page 428. The relevant discussions made by Apex Court in Para 10.1 to Para 10.3 are quoted as under :
10.1 In North Eastern Railway Administration, Gorakhpur v. Bhagwan Das (Dead) By LRs. [(2008) 8 SCC 511], the law has laid down by this Court in the following terms:
"16.
Insofar as the principles which govern the question of granting or disallowing amendments under Order 6 Rule 17 CPC (as it stood at the relevant time) are concerned, these are also well settled. Order 6 Rule 17 CPC postulates amendment of pleadings at any stage of the proceedings. In Pirgonda Hongonda Patil v. Kalgonda Shidgonda Patil3 which still holds the field, it was held that all amendments ought to be allowed which satisfy the two conditions: (a) of not working injustice to the other side, and (b) of being necessary for the purpose of determining the real questions in controversy between the parties. Amendments should be refused only where the other party cannot be placed in the same position as if the pleading had been originally correct, but the amendment would cause him an injury which could not be compensated in costs. (Also see Gajanan Jaikishan Joshi v. Prabhakar Mohanlal Kalwar)."
10.2 Yet again, in Bollepanda P. Poonacha & Anr. v. K.M. Madapa [(2008) 13 SCC 179], the law is laid down in the following terms :
"15.
A belated counterclaim must be discouraged by this Court. See Ramesh Chand Ardawatiya v. Anil Panjwani. We are, however, not unmindful of the decisions of this Court where a defendant has been allowed to amend his written statement so as to enable him to elaborate his defence or to take additional pleas in support of his case. The Court in such matters has a wide discretion. It must, however, subserve the ultimate cause of justice. It may be true that further litigation should be endeavoured to be avoided. It may also be true that joinder of several causes of action in a suit is permissible. The Court, must, however, exercise the discretionary jurisdiction in a judicious manner. While considering that subservance of justice is the ultimate goal, the statutory limitation shall not be overstepped. Grant of relief will depend upon the factual background involved in each case. The Court, while undoubtedly would take into consideration the questions of serious injustice or irreparable loss, but nevertheless should bear in mind that a provision for amendment of pleadings is not available as a matter of right under all circumstances. One cause of action cannot be allowed to be substituted by another. Ordinarily, effect of an admission made in earlier pleadings shall not be permitted to be taken away. See State of A.P. v. Pioneer Builders6 and Steel Authority of India Ltd. v. Union of India7 and Himmat Singh v. ICI India Ltd." (Emphasis supplied) 10.3 Yet again, in Vidyabai & Ors. v. Padmalatha & Anr. [(2009) 2 SCC 409], this Court upon taking into consideration the effect of the insertion of proviso to Order VI Rule 17 held as under :
"10.
By reason of the Civil Procedure Code (Amendment) Act, 2002 (Act 22 of 2002), Parliament inter alia inserted a proviso to Order 6 Rule 17 of the Code, which reads as under :
"Provided that no application for amendment shall be allowed after the trial has commenced, unless the court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of trial."
It is couched in a mandatory form. The court's jurisdiction to allow such an application is taken away unless the conditions precedent therefor are satisfied viz. it must come to a conclusion that in spite of due diligence the parties could not have raised the matter before the commencement of the trial.
XXX XXX XXX 19.
It is the primal duty of the court to decide as to whether such an amendment is necessary to decide the real dispute between the parties. Only if such a condition is fulfilled, the amendment is to be allowed. However, proviso appended to Order 6 Rule 17 of the Code restricts the power of the court. It puts an embargo on exercise of Its jurisdiction. The court's jurisdiction, in a case of this nature is limited. Thus, unless the jurisdictional fact, as envisaged therein, is found to be existing, the court will have no jurisdiction at all to allow the amendment of the plaint.
30. Similarly, Apex Court has also examined this issue in case of Revajeetu Builders and Developers Versus Narayanaswamy & Sons & Others reported in JT 2009 (13) Supreme Court Page 366. The relevant discussions made by Apex Court in Para 25 to 54 are quoted as under :
25. If we carefully examine all the cases, the statement of law declared by the Privy Council in Ma Shwe Mya v. Maung Mo Hnaung (AIR 1922 PC
240) has been consistently accepted by the courts till date as correct statement of law. The Privy Council observed :
"All rules of court are nothing but provisions intended to secure the proper administration of justice, and it is therefore essential that they should be made to serve and be subordinate to that purpose, so that full powers of amendment must be enjoyed and should always be liberally exercised, but nonetheless no power has yet been given to enable one distinct cause of action to be substituted for another, nor to change, by means of amendment, the subject-matter of the suit."
26. When we apply the principle laid down by the above judgments, the conclusion becomes irresistible that the view taken by the High Court in the impugned judgment cannot be said to be unjustified.
27. We are tracing the legislative history, objects and reasons for incorporating Order VI Rule 17 not because it is necessary to dispose of this case, but a large number of applications under Order VI Rule 17 are filed and our courts are flooded with such cases. Indiscriminate filing of applications of amendments is one of the main causes of delay in disposal of civil cases. In our view, clear guideline may help disposing off these applications satisfactorily.
28. We deem it appropriate to give historical background of Rule 17 of Order VI corresponds to section 53 of the Old Code of 1882.It is similar to Order 21 Rule 8 of the English Law. Order VI Rule 17 CPC reads as under :
"Amendment of Pleadings. - The Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such manner and on such terms as may be just, and all such amendments shall be made as may be necessary for the purpose of determining the real questions in controversy between the parties:
Provided that no application for amendment s hall be allowed after the trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of trial."
29. In our considered view, Order VI Rule 17 is one of the important provisions of the CPC, but we have no hesitation in also observing that this is one of the most misused provision of the Code for dragging the proceedings indefinitely, particularly in the Indian courts which are otherwise heavily overburdened with the pending cases. All Civil Courts ordinarily have a long list of cases, therefore, the Courts are compelled to grant long dates which causes delay in disposal of the cases. The applications for amendment lead to further delay in disposal of the cases.
30. It may be pertinent to mention that with a view to avoid delay and to ensure expeditious disposal of suits, Rule 17 was deleted on the recommendation of Justice Malimath Committee by the Code of Civil Procedure (Amendment) Act, 1999 but because of public uproar, it was revived. Justice C.K. Thakker, an eminent former Judge of this Court in his book on Code of Civil Procedure (2005 Edition) incorporated this information while dealing with the object of amendment.
31. In a recently published unique,unusual and extremely informative book "Justice, Courts and Delays", the author Arun Mohan, a Senior Advocate of the High Court of Delhi and of this Court, from his vast experience as a Civil Lawyer observed that 80% applications under Rule VI Order 17 are filed with the sole objective of delaying the proceedings, whereas 15% application are filed because of lackadaisical approach in the first instance,and 5% applications are those where there is actual need of amendment. His experience further revealed that out of these 100 applications, 95 applications are allowed and only 5 (even may be less) are rejected. According to him, a need for amendment of pleading should arise in a few cases, and if proper rules with regard to pleadings are put into place, it would be only in rare cases. Therefore, for allowing amendment, it is not just costs, but the delays caused thereby, benefit of such delays, the additional costs which had to be incurred by the victim of the amendment. The Court must scientifically evaluate the reasons, purpose and effect of the amendment and all these factors must be taken into consideration while awarding the costs.
32. To curtail delay in disposal of cases, in 1999 the Legislation altogether deleted Rule 17 which meant that amendment of pleading would no longer have been permissible. But immediately after the deletion there was widespread uproar and in 2002 Rule 17 was restored, but added a proviso. That proviso applies only after the trial has commenced. Prior to that stage, the situation remains as it was. According to the view of the learned author Arun Mohan as observed in his book, although the proviso has improved the position, the fact remains that amendments should be permissible, but only if a sufficient ground therefore is made out, and further, only on stringent terms. To that end, the rule needs to be further tightened.
33. The general principle is that courts at any stage of the proceedings may allow either party to alter or amend the pleadings in such manner and on such terms as may be just and all those amendments must be allowed which are imperative for determining the real question in controversy between the parties. The basic principles of grant or refusal of amendment articulated almost 125 years ago are still considered to be correct statement of law and our courts have been following the basic principles laid down in those cases.
34. In the leading English case of Cropper v. Smith[1884 (29) Ch D 700],the object underlying amendment of pleadings has been laid down by Browen, L.J. in the following words :
"It is a well established principle that the object of the courts is to decide the rights of the parties and not punish them for mistakes they make in the conduct in their cases by deciding otherwise than in accordance with their rights ... I know of no kind of error or mistake which, if not fraudulent or intended to overreach, the court ought not to correct if it can be done without injustice to the other party. Courts do not exist for the sake of discipline but for the sake of deciding matters in controversy, and I do not regard such amendment as a matter of favour or grace ... it seems to me that as soon as it appears that the way in which a party has framed his case will not lead to a decision of the real matter in controversy, it is as much a matter of right on his part to have it corrected if it can be done without injustice, as anything else in the case is a matter of right."
35. In Tildersley v. Harper[1989 (10) Ch.D. 393] which was decided by the English Court even earlier than the Cropper's case (supra), in an action against a lessee for setting aside a lease, in the statement of claim it was alleged that the power of attorney of donee had received specified sum as a bribe. In the statement of defence, each circumstance was denied but there was no general denial of a bribe having been given. A prayer for amendment of the defence statement was refused.
36. The Court of Appeal held that the amendment ought to have been allowed. Bramwell, L.J. made the following pertinent observations :
"I have had much to do in Chambers with applications for leave to amend, and I may perhaps be allowed to say that this humble branch of learning is very familiar to me. My practice has always been to give leave to amend unless I have been satisfied that the party applying was acting mala fide, or that, by his blunder he had done some injury to his opponent which could not be compensated for by costs or otherwise."(Emphasis added)
37. In another leading English case Weldon v. Nea [1880 (19) QBD 394 :
56 LJ QB 621], A filed a suit against B for damages for slander. A thereafter applied for leave to amend the plaint by adding fresh claims in respect of assault and false imprisonment. On the date of the application, those claims were barred by limitation though they were within the period of limitation on the date of filing the suit.
The amendment was refused since the effect of granting it would be to take away from B the legal right (the defence under the law of limitation) and thus would cause prejudice to him.
38. The rule, however, is not a universal one and under certain circumstances, such an amendment may be allowed by the court notwithstanding the law of limitation. The fact that the claim is barred by law of limitation is but one of the factors to be taken into account by the court in exercising the discretion as to whether the amendment should be allowed or refused, but it does not affect the power of the court if the amendment is required in the interests of justice. Ganga Bai v. Vijai Kumar [1974 (2) SCC 393]; Arundhati Mishra v. Sri Ram Charitra Pandey [1994 (2) SCC 29].
39. In Steward v. North Metropolitan Tramways Co.10, the plaintiff filed a suit for damages against the tramways Company for negligence of the company in allowing the tramways to be in a defective condition. The company denied the allegation of negligence. It was not even contended that the company was not the proper party to be sued. More than six months after the written statement was filed, the company applied for leave to amend the defence by adding the plea that under the contract entered into between the company and the local authority the liability to maintain tramways in proper condition was of the latter and, therefore, the company was not liable. On the date of the amendment application, the plaintiff's remedy against the local authority was time barred. Had the agreement been pleaded earlier, the plaintiff could have filed a suit even against the local authority. Under the circumstances, the amendment was refused.
40. In the said case, Pollock, J. quoting with approval the observation of Bremwell, LJ. rightly observed : "The test as to whether the amendment should be allowed is,whether or not the defendants can amend without placing the plaintiff in such a position that he cannot be recouped, as it were, by any allowance of costs, or otherwise. According to him such an amendment ought not be allowed."
41. Kisandas v. Rachappa Vithoba11 is probably the first leading case decided by the High Court of Bombay under the present Code of 1908. There, A, plaintiff, averred that in pursuance of a partnership agreement, he delivered Rs.4001 worth of cloth to B, defendant, and sued for dissolution of partnership and accounts. The trial court found that A delivered the cloth worth Rs.4001 but held that there was no partnership and the suit was not maintainable. In appeal, A sought amendment of adding a prayer for the recovery of Rs.4001. On that day, claim for recovery of money was barred by limitation. The amendment was allowed by the appellate court and the suit was decreed. B challenged the decree. The High Court upheld the order and dismissed the appeal. Referring to leading English decisions on the point, Batchelor, J. stated :
"From the imperative character of the last sentence of the rule it seems to me clear that, at any stage of the proceedings, all amendments ought to be allowed which satisfy the two conditions (a) of not working in justice to the other side, and (b) of being necessary for the purpose of determining the real questions in controversy between the parties."
42. In a concurring judgment, Beaman, J. observed that "the practice is to allow all amendments, whether introducing fresh claims or not, so long as they do not put the other party at a disadvantage for which he cannot be compensated by costs."
His Lordship proceeded to state :
"In my opinion two simple tests, and two only, need to be applied, in order to ascertain whether a given case is within the principle. First, could the party asking to amend obtain the same quantity of relief without the amendment? If not, then it follows necessarily that the proposed amendment places the other party at a disadvantage, it allows his opponent to obtain more from him than he would have been able to obtain but for the amendment. Second, in those circumstances, can the party thus placed at a disadvantage be compensated for it by costs? If not, then the amendment ought not, unless the case is so peculiar as to be taken out of the scope of the rule, to be allowed."
43. In Amulakchand Mewaram & Others v. Babulal Kanalal Taliwala[1933 (35) Bom. LR 569], the Bombay High Court again had an occasion to decide a case under Order VI Rule 17. In that case, the Court approved the following observations of Beaumont, C.J. and observed :
"...
the question whether there should be an amendment or not really turns upon whether the name in which the suit is brought in the name of a non-existent person or whether it is merely a misdescription of existing persons. If the former is the case, the suit is a nullity and no amendment can cure it. If the latter is the case, prima facie, there ought to be an amendment because the general rule, subject no doubt to certain exceptions, is that the Court should always allow an amendment where any loss to the opposing party can be compensated for by costs."
44. In L.J. Leach & Co. Ltd. & Another v. Jardine, Skinner & Co. [AIR 1957 SC 357],a suit for damages for `conversion of goods' filed by the plaintiff was decreed by the trial court but the decree was set aside by the High Court. In an appeal before this Court, the plaintiff applied for amendment of the plaint by raising an alternative claim for damages for breach of contract for `non-delivery of goods'. The amendment was resisted by the defendant contending that it sought to introduce a new cause of action which was barred by limitation on the day the amendment was sought and, hence, it would seriously prejudice the defendant.
45. Though the Court noticed `considerable force' in the objection, keeping in view the prayer in the amendment which was not `foreign to the scope of the suit' and all necessary facts were on record, it allowed the amendment.
46. In P.H. Patil v. K.S. Patil14, A obtained a decree for possession against B. He was, however, obstructed in obtaining possession by C in execution. A then filed a substantive suit against B and C. In the plaint, except saying that he had obtained a decree against B, nothing more was stated by A. Hence, he filed an application for amendment which was rejected by the trial court but allowed by the High Court. C approached this Court.
47. Dismissing the appeal and confirming the order of the High Court, this Court observed that the discretionary power of amendment was not exercised by the High Court on wrong principles. There was merely a defect in the pleading which was removed by the amendment. The quality and quantity of the reliefs sought remained the same. Since the amendment did not introduce a new case, the defendant was not taken by surprise.
48. In Pursuhottam Umedbhai & Co. v. Manilal & Sons [AIR 1961 SC 325]a suit was instituted in the name of the firm by the partners doing business outside India. It was held that there was only mis-description of the plaintiff. The plaint in the name of the firm was not a nullity and could be amended by substituting the names of partners.
49. In similar circumstances, in a subsequent case Ganesh Trading Co. v. Moji Ram [1978 (2) SCC 91],this Court reiterated the law laid down in Purushottam Umedbhai & Co. (supra). The Court observed :
"It is true that, if a plaintiff seeks to alter the cause of action itself and to introduce indirectly, through an amendment of his pleadings, an entirely new or inconsistent cause of action, amounting virtually to the substitution of a new plaint or a new cause of action in place of what was originally there, the Court will refuse to permit it if it amounts to depriving the party against which a suit is pending of any right which may have accrued in its favour due to lapse of time. But, mere failure to set out even an essential fact does not, by itself, constitute a new cause of action. A cause of action is constituted by the whole bundle of essential facts which the plaintiff must prove before he can succeed in his suit. It must be antecedent to the institution of the suit. If any essential fact is lacking from averments in the plaint the cause of action will be defective. In that case, an attempt to supply the omission has been and could sometime be viewed as equivalent to an introduction of a new cause of action which, cured of its shortcomings, has really become a good cause of action. This, however, is not the only possible interpretation; to be put on every defective state of pleadings. Defective pleadings are generally curable, if the cause of action sought to be brought out was not ab initio completely absent. Even very defective pleadings may be permitted to be cured, so as to constitute cause of action where there was none, provided necessary conditions, such as payment of either any additional court fees, which may be payable, or, of costs of the other side are complied with. It is only if lapse of time has barred the remedy on a newly constituted cause of action that the Courts should, ordinarily, refuse prayers for amendment of pleadings."
50. In Laxmidas Dayabhai Kabrawala v. Nanabhai Chunilal Kabrawala & Others17, the defendant's prayer for amendment by treating a counter claim as cross-suit was objected to by the plaintiff inter alia on the ground of limitation. The amendment, however, was allowed.
51. When the matter reached this Court, while affirming the order of the High Court, the majority stated :
".....It is, no doubt, true that, save in exceptional cases, leave to amend under O. 6, r.17 of the Code will ordinarily be refused when the effect of the amendment would be to take away from a party a legal right which had accrued to him by lapse of time. But this rule can apply only when either fresh allegations are added or fresh reliefs sought by way of amendment. Where, for instance, an amendment is sought which merely clarifies an existing pleading and does not in substance add to or alter it, it has never been held that the question of a bar of limitation is 17 AIR 1964 SC 11 one of the questions to be considered in allowing such clarification of a matter already contained in the original pleading."
52. The Court further observed that since there was no addition to the averments or relief, it was not possible to uphold the contention of the plaintiff that by conversion of written statement into a plaint in a cross-suit, a fresh claim was made or a new relief was sought. To the facts of the present case, therefore, the decisions holding that amendments could not ordinarily be allowed beyond the period of limitation and the limited exceptions to that rule have no application.
53. In Jai Jai Ram Manohar Lal v. National Building Material Supply [1969 (1) SCC 869], A sued B in his individual name but afterward soughts leave to amend the plaint to sue as the proprietor of a Hindu Joint Family business. The amendment was granted and the suit was decreed. The High Court, however, reversed the decree observing that the action was brought by a `non-existing person'.
54. Reversing the order of the High Court, this Court (per Shah, J., as he then was) made the following oft-quoted observations :
Rules of procedure are intended to be a handmaid to the administration of justice. A party cannot be refused just relief merely because of some mistake, negligence, inadvertence or even infraction of the rules of procedure. The Court always gives leave to amend the pleading of a party, unless it is satisfied that the party Applying, was acting mala fide, or that by his blunder, he had caused injury to his opponent which may not be compensated for by an order of costs. However negligent or careless may have been the first omission, and, however late the proposed amendment, the amendment may be allowed if it can be made without injustice to the other side." (Emphasis Added)
31. This Court had an occasion to decide the said issue in case of Muktaben Mohanjibhai Solanki and Another versus Jagdishbhai Devrajbhai Patel reported in AIR 2009 Gujarat 172.
The relevant is quoted as under with Head Note :
Head Note : Civil Procedure Code (5 of 1908) Order VI, Rule 17 Amendment of written statement Withdrawal of admission earlier made by way of amendment Not permissible Such amendment cannot be allowed.
Where in the original written statement the respondent has categorically admitted that the petitioners were owners in possession of land comprised in sub-plots Nos.111 to 116 in Revenue Survey No.310 and that the respondent was the owner in possession of 500 sq.mtrs., of land in revenue Survey No.311 and in the original written statement, the respondent has not disputed the validity of the sale deeds vide which the petitioners have purchased the suit property and by making the amendment in the written statement, the respondent sought to resile completely from the stand taken by him earlier, as the respondent not only sought to deny the ownership and possession of the petitioners regarding sub-plots Nos.111 to 116 of Revenue Survey No.310, but also sought to put up a case that the Sale Deeds vide which the petitioners have purchased the land were null and void, such an amendment cannot be allowed.
The respondent was not seeking a clarification, or trying to explain the admissions made by him but, in a complete volte-face, is resiling from the categorical admissions made by him. Explaining or offering a clarification regarding an admission stands on one footing whereas resiling from the same, would stand on a totally different footing. Such a course is not permissible.
AIR 2009 SC (Supp.) 363 Rel. on.
32. Recently, said issue has been decided by Madras High Court in case of B.K. Krishnamurthy versus S. Balasubramanian & Ors.
reported in AIR 2010 (NOC) 590 (Mad.).
The relevant is Head Note which is quoted as under :
Civil Procedure Code (5 of 1908), O.VI R.17 Amendment of pleading Originally plaintiff came forward with a suit for declaration Pending suit vide amendment application, he has come forward with prayer of specific performance in respect of same property Character of suit would be changed and entire cause of action would also be changed Also it would cause prejudice to opposite party Court can refuse amendment.
33. Learned Senior Advocate Mr. P.M. Thakkar has not been able to explain any circumstances before this Court that why such subsequent draft amendment is necessary and why same challenge was not made by petitioner at the time of filing present petition. It is a duty of the petitioner to point out before this Court that draft amendment is necessary for deciding real controversy of the subject matter between the parties. Learned Senior Advocate Mr. P.M. Thakkar has merely mentioned relevant provisions of agreement dated 17th August, 2005 but not pointed out any justification which would require such draft amendment to be granted. Once draft amendment is opposed by other side, then, it is the duty of the petitioner to justify amendment which has been placed on record to be granted in the interest of justice, otherwise, petitioner will be put into disadvantageous situation. As regards reason for draft amendment or any justification to grant draft amendment, learned Senior Advocate Mr. P.M. Thakkar has not made any submission before this court. On the contrary, learned Senior Advocate Mr. Thakkar has pointed out merits of the matter and has also made submissions in respect to reasonable interpretation of Condition/Clause No.5.6 while relying upon conditions of agreement dated 17th August, 2005. At the time of filing petition, positive stand including cause of action has been disclosed by petitioner before this court and thereafter, receiving reply from the respondents, all of a sudden, such draft amendment has been filed which is clearly changing the character and nature of petition as well as also changing cause of action and basic prayer in petition and, therefore, apparently, it is an after thought and counter blast against the contentions raised by respondents in their affidavit in reply and, therefore, it is not bona fide on the part of the petitioner and in such circumstances, defence of the respondents to rely upon such condition is put to an adverse situation which is changing entire nature and controversy of the subject matter between the parties.
34. In view of above observations made by Apex Court and considering the facts of present case, when in petition, petitioner has not challenged agreement dated 17th August 2005 or any condition thereof and no prayer is made to that effect, therefore, petitioner seeks to alter the cause of action itself and to introduce indirectly through Draft Amendment in its pleadings and entirely a new or inconsistent cause of action is amounting to virtually substitution of new petition or a new cause of action in place of what was originally there. It also amounts to deprive the respondent from its right which has been accrued in their favour and such amendment seems to be an afterthought and not bona fide. In Affidavit-in-Reply, respondent has relied upon Item No.5.6 of the Agreement dated 17th August 2005 which comes in the way of present petitioner in getting relief, therefore, very defence of respondent now has been challenged by way of Draft Amendment, then, it is virtually a substitution of new case or new cause of action in place of what was originally there. Draft Amendment is causing great prejudice to respondent which cannot be compensated in terms of money to respondent. The Draft Amendment placed on record by petitioner which was not based on mistake or omission on the part of the petitioner. If petitioner wants to change Condition/Clause No.5.6, then, from very beginning, such Clause can be challenged, but, nowhere in present petition, such Clause is challenged. On the contrary, entire Agreement has been admitted by petitioner in petition. If the Draft Amendment is permitted, then, the real controversy and question raised in present petition is changed and alteration of the same, the nature and character of petition is also changed. No explanation is given by petitioner for subsequent challenge made in draft amendment.
35. Therefore, according to my opinion, Draft Amendment placed on record by petitioner dated 4th August 2010 cannot be granted, otherwise, it amounts to permit the petitioner to change entire nature and character of petition including prayer clause and cause of action. This agreement remained continue, binding for more than five years between parties and benefits flowing from that, has been received therefor and it is binding to petitioner. It is being a valid agreement not disputed during five years period. Now, all of sudden, challenge is made, because, just to damage the defence of respondent which cause great prejudice to the rights of respondent and therefore, according to my opinion, this amendment is not bona fide, afterthought and just to raise for damaging the defence of respondent. Therefore, same is not granted and Draft Amendment placed on record by petitioner dated 4th August 2010 is hereby rejected.
36. It is made clear by this Court that while giving dictation, this Court has taken sufficient care and not observed anything on merits, for that, petition is still pending at before this Court. Therefore, order is passed by this Court without expressing any opinion on merits.
37. Today, this Court has pronounced the CAV Judgment on Draft Amendment placed on record by petitioner dated 4th August 2010. Thereafter, learned advocate Mr. Pahwa for petitioner requests to adjourn this matter on 23rd August 2010 in respect to hearing of main petition. Considering his request, matter is adjourned to 23 rd August 2010.
Registry is directed to notify this matter in First Board.
Sd/-
[H.K. RATHOD, J.] #Dave Top