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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 2205 OF 2020
Prasad Dattajirao Patil .. Petitioner
Mr. Shreehari Aney, Senior Advocate through VC a/w. Mr. Mandar
Goswami, Mr. Sachin Nerkar and Mr. Rahul Rane, Advocate for
Petitioner.
Mr. Amrut Joshi a/w. Yarad Udwadia, Mr. Mani Thevar and Ms. Kavita Sharma i/by Ganesh and Co. for Respondent Nos.1, 2 and 3. ...................
JUDGMENT
1. Heard Mr. Aney, learned Senior Advocate for Petitioner and Mr. Joshi, learned Advocate for Respondent Nos.1, 2 and 3.
2. This Writ Petition takes exception to the order dated 26.08.2019 passed below Exhibit “74” in Special Civil Suit No.689 of 2016 pending before the Trial Court. Respondent No.1 is the Plaintiff. Respondent No.4 is Vasant Dada Patil Seva Sanstha, a Trust whereas Respondent Nos.[5] to 8 are the office bearers of the said Trust. Respondent Nos.[9] to 13 are the Trustee and members of the said Trust.
3. Before I advert to the impugned order passed below Exhibit “74”, it is pertinent to narrate the relevant facts leading to the passing of the impugned order. 1 of 17
4. Respondent No.4 - Trust decided to construct a hospital building and school building on land owned by it. This was in 2013. At that time, Petitioner was the president of Respondent No.4 - Trust. According to the Petitioner, this was however not to his knowledge at all. It was decided that the name of the hospital would be ‘Dr. P.D. Patil Hightech Hospital and Medical Research Centre’ and the name of the school would be ‘Smeeta Patil New English School’. A tender was floated in February 2014 by the Trust for construction of the hospital and school building.
5. Respondent No.1 was the successful bidder and was awarded the work for construction for the hospital building and school building. Two work orders dated 25.03.2013 and 02.04.2013 were issued by the Trust in favour of Respondent No.1 - Firm. Construction commenced. On 05.09.2013 the first Running Account Bill (for short “RA Bill”) was raised for Rs.2.52 crores. According to Respondent No.1 this bill was certified by the Project Management Consultancy (for short “PMC”) for Rs.2.20 crores, but Respondent No.4 - Trust did not pay the said amount. On 11.12.2013, second RA Bill was raised for Rs.3.24 crores by Respondent No.1 – Firm which included the previous unpaid amount under the first RA Bill. The PMC certified the second RA Bill for Rs.2.47 crores. Since both bills remained unpaid, Respondent No.1 – Firm did not continue construction further and by letter dated 20.01.2014 called upon Respondent No.4 - Trust and its office bearers 2 of 17 including Petitioner to pay the outstanding amount. On 25.01.2014, third RA Bill for amount of Rs.63.64 lakhs was also certified by PMC.
6. In April 2014, Respondent No.4 - Trust issued 3 cheques totalling to an amount of Rs.[4] crores and handed them over to Respondent No.1 - Firm with instructions to present them on due dates. Thereafter, on 10.09.2014 Respondent No.4 - Trust reissued 3 new post dated cheques to Respondent No.1 - Firm totalling to an amount of Rs.3.99 crores. On presentation, the cheques were dishonoured. The Respondent No.1 - Firm initiated legal action under Section 138 of the Negotiable Instruments Act, 1881 (for short “NI Act, 1881”) against Respondent No.4 - Trust and its office bearers. Criminal complaint was filed in 2015 against Petitioner and Respondent No.5 only. In the proceedings before the Judicial Magistrate First Class, Pune though initially Petitioner was impleaded as a party, that Court in Criminal Revision Application Nos.374 and 375 of 2015 passed an order to delete the name of the Petitioner.
7. In the above backdrop, Respondent Nos.[1] to 3 (Respondent No.1 - Firm and its partners) filed Special Civil Suit No.689 of 2016 in the Trial Court for recovery of money (outstanding amounts under the RA bills) and other consequential reliefs including injunction.
8. Petitioner was served with the Suit Summons and filed his written statement denying his liability as Managing Trustee of 3 of 17 Respondent No.4 - Trust. It was the specific case of Petitioner in his written statement that he was never a founder member or even a trustee of Respondent No.4 - Trust, that he had never applied for membership of the said trust at any point of time or even given his consent to insert his name as members of Managing Committee of the Trust. According to him sometime in November – December, 2012 he came to know that for the first time without his written or oral consent his name was added in the Managing Committee of the Trust for the period 2003 – 2008 and 2008 – 2013 and only at the time he realised that the Hospital and Medical Research Centre which was contemplated to be constructed in February 2013 was in his name. Petitioner further stated that once he came to know about the above fact, he immediately sent a legal notice dated 26.12.2012 through his lawyers to Respondent No.4 - Trust endorsing a copy to the Assistant Charity Commissioner and the Cosmos Cooperative Bank Ltd., Pune. In the written statement filed by Petitioner in the Suit he stated that when he came to know that Respondent No.5 had without his consent appointed him as Managing Trustee of Respondent No.4 - Trust, he immediately called upon Respondent No.5 to delete his name. It was specifically pleaded by Petitioner in his written statement that at no point of time in the past he was ever associated with Respondent No.4 - Trust or its functioning or management. 4 of 17
9. In view of the above facts, Petitioner filed Application below Exhibit “37” in Special Civil Suit before the Trial Court under Order I Rule 10(2) of the Code of Civil Procedure, 1908 (for short “CPC”) for striking out his name as Defendant No.4 in the array of parties as office bearers and member of the Trust. The principle defence being that Petitioner was never related to the subject transactions based on which the Suit was filed nor had ever dealt with the management of Respondent No.4 - Trust. This Application was resisted by Respondent Nos.[1] to 3. After hearing both sides, by order dated 26.08.2019 the Trial Court allowed the Application below Exhibit “37”. However, on the same date Application below Exhibit “74” also came to be allowed by the Trial Court. This Application below Exhibit “74” was filed by Respondent Nos.[1] to 3 under Order VI Rule 17 of the CPC to amend the Suit plaint. By virtue of the amendment, Respondent Nos.[1] to 3 sought to modify the array of party Defendants and implead Vasant Dada Patil Seva Sanstha i.e. the Trust as principal Defendant No.1 in the Suit and to add Dr. P.D. Patil Hightech Hospital and Medical Research Centre as Defendant No.1A and renumber the nomenclature of Petitioner from Defendant No.4 to Defendant No.12. This Application seeking amendment was filed on 17.04.2019 and was allowed on 26.08.2019 by a separate order. The Application below Exhibit “74” was staunchly resisted by Petitioner on the ground of limitation and also a new case having been now pleaded in the Suit. 5 of 17 Petitioner resisted the Application by stating that the Respondent Nos.[1] to 3 sought the proposed amendment after a hiatus of more than 3 years when the defence of Petitioner was already placed on record in his written statement filed in the year 2016 and Petitioner’s Application below Exhibit “37” for striking out the Petitioner’s name being filed on 29.06.2016 was pending. It was pleaded that Petitioner filed substantive documentary evidence in the form of documents below Exhibit “39” on 29.06.2016 and Exhibit “59” on 19.09.2016. It was therefore averred by Petitioner that despite knowing the Petitioner’s defence from 2016 onwards, there was abnormal delay in filing the Application seeking amendment below Exhibit “74”. Respondent Nos.[4] – 13, incidentally did not file any reply to the Application below Exhibit “74”. Application below Exhibit “74” was allowed by the impugned order dated 26.08.2019 which is challenged in the present petition. By virtue of that order, the Plaintiff i.e. Respondent No.1 was allowed to amend the Suit plaint and it was directed that Petitioner’s name as Defendant No.4 be struck off and he be added as Defendant No.12 in his personal capacity. Plaintiff was also directed to pay cost of Rs.5000/- for this to Defendant No.4 i.e. Petitioner. It was held that after the amendment was carried out, Defendant No.4 i.e. Petitioner would be at liberty to file fresh or additional written statement. 6 of 17
10. Mr. Aney, learned Senior Advocate appearing for Petitioner has made the following submissions in challenge to the impugned order dated 26.08.2019 passed in Application below Exhibit “74”:-
10.1. He would submit that there is no privity of contract between Petitioner and the Respondent - Company where under the alleged claim had arisen. He would submit that Petitioner has no liability nor rights under the contract on which the alleged claim is based. He would submit that Petitioner is neither a necessary nor a proper party in the Suit plaint as he is not a Trustee of the Defendant – Trust nor had any association with the Trust at all.
10.2. He would submit that the Trust, in reply through its Advocate Mr. Milind Sawant dated 19.01.2013 and its amendment Application filed before the Charity Commissioner to the Change Report, has categorically admitted, that the Petitioner Mr. P.D. Patil has never submitted his consent in writing or orally for being a trustee of the trust.
10.3. He would submit that the Charity Commissioner has therefore held that Petitioner’s name was wrongly included in the names of trustees as stated in the Trust’s resolution and has directed appropriate correction in the records of the Trust. He would submit that the learned Sessions Court has similarly opined that Petitioner was not involved in the alleged criminal case of cheque bouncing and 7 of 17 cheating and has therefore discharged him from the criminal proceedings instituted by the Respondent No.1 - Firm against the trustees of the Trust.
10.4. He would submit that even if for the sake of argument the Respondent’s submission it to be accepted that it was mislead into believing that the Trust had nexus with the Plaintiff – Company, there is no claim that can be found on such assumption for initiating civil action for recovery of payment of RA bills personally from the Petitioner.
10.5. He would submit that if at all such a claim is sought to be raised, the Respondent - Firm will need to raise it in an appropriate proceeding, subject to cause of action and provided it is in limitation.
10.6. In support of his above submissions, he would rely on the order dated 21.10.2016 passed by the Court of Sessions at Pune in Criminal Revision Application No.375 of 2015 and more specifically on the contents of paragraph Nos.[9] to 12 which are findings returned by the said to arrive at a decision as to whether the Petitioner was responsible for the day to day affairs of the said Trust.
10.7. For the sake of immediate reference, the said paragraph Nos.[9] to 12 are reproduced below:- “9. Heard the learned counsel for both the sides. Perused the entire record. On perusal of complaint itself, it seems that the tender has been issued by accused no.1, accused no.1 himself 8 of 17 has confirmed the bills. It is accused no.1 who executed the agreement for this transaction with the complainant. In the entire complaint, there is no averment that how the accused no.2 is responsible for day-to-day management of this institute and center. No responsibility has been fixed by the complainant.
10. It is very material to note that though according to the complainant, the accused no.2 was the Vice-President of the trust, however, it is specifically stressed on behalf of accused no.1 that he was totally unaware of his nomination or even his post as a Vice-President of the trust. The learned counsel for accused no.2 has drawn my attention towards the rules and regulations for becoming a trustee. It seems that as per Clause-3 of the regulation, the person/candidate is required to fill-up the form and to pay the requisite fee. However, no such document has been placed on record by the complainant to show that it is the accused no.2 who applied for becoming a trustee or consequently he became a vice-president. It further seems that one Mulik proposed the name of accused no.2 for the post of Vice-President. However, everything occurred in absence of accused no.2 who is completely unaware of the said correspondence or affairs. On the contrary, the accused no.2 has relied upon the change report dated 17.09.2007 as well as notice reply given by accused no.1 in which he has admitted that accused no.2 was completely unaware of the fact that his name was proposed and accused no.2 became a Vice-President. If we see the change report and the further orders, it seems that the name of accused no.2 has been deleted as ab-initio. So, at the relevant time, he was not working as a vice-president or even a trustee of the trust.
11. It is very material to note that admittedly, there was no application made by applicant no.2 to complete the formality of becoming a trustee or vice president. The attention has also been drawn towards list no.9. If we see this document, the name of accused no.2 is appearing in list no.9 however, he has not signed it. So, again this fact confirms the absence of accused no.2 on that particular day. So, entire things brought on record go to show that accused no.2 was not a trustee nor the Vice- President of the trust. He was also not responsible for day-today affairs of the trust.
12. It is also material to note that there is no postponement of issuance of process as such. It is the complainant to show the vicarious liability and the specific role to be played by accused no.2 to fix the responsibility. However, in the entire complaint, the role of the accused no.2 is silent to fix the responsibility on behalf of the trust and day-to-day management by accused no.2.” 9 of 17
10.8. On the basis of his above submissions, he would submit that the Application filed below Exhibit “74” changes the entire complexion and nature of the suit proceedings as also the cause of action by impleading the Petitioner in his personal capacity, which is impermissible in law and hence the impugned order dated 26.08.2019 passed below Exhibit “74” should be quashed and set aside. He has also placed reliance upon an Application which is the amendment Application filed by Respondent No.4 - Trust dated 08.10.2013 and signed by the reporting Trustee - Mohanrao P. Shinde which categorically admits and states that Petitioner is not a Member nor a Trustee nor had participated in any of the meetings of the Trust and his name was included as a Trustee in the Change report due to a typographical mistake in the resolution of the Trust dated 10.02.2008.
10.9. In view of the above, he would submit that Petitioner has no nexus whatsoever with the Trust and therefore the impugned order is bad in law and deserves to be quashed and set aside.
11. PER CONTRA, Mr. Joshi, learned Advocate appearing for Respondent Nos.[1] to 3 i.e. Plaintiffs in the suit proceedings has vehemently opposed the Petition and made the following submissions on behalf of the Respondent No.1 - Firm:-
11.1. He would submit that Defendant No.4 is appropriately impleaded in his capacity as a Trustee of Defendant No.1 - Trust and 10 of 17 all the Defendants are jointly and severally liable to pay the claimant Plaintiff.
11.2. That privity of contract between Plaintiff and Defendant No.4 as stated by Defendant No.4 in Application below Exhibit “37” can be considered only at the time of trial and not at interim stage.
11.3. That Petitioner despite being aware of the cause of action in the Suit filed has averred in his written statement that Defendant No.1 Trust is not a registered trust and does not exist in the eyes of law.
11.4. That in furtherance to existence of documentary evidence, Defendant No.4 – Petitioner cannot be exempted from the reliefs claimed against him. Hence Plaintiff has every right to proceed against all Defendants.
11.5. That the amendment proposed by Plaintiff below Exhibit “E” was sought to ascertain the real question in controversy between parties in connection with the tender and Defendant No.4 never mentioned that he is not a Trustee. Hence, in the order dated 26.08.2019 by virtue of the doctrine of estoppel and allegations made against Defendant No.4 of stage management, Defendant No.4 was struck out as a Trustee and was impleaded as Defendant No.12 in his personal capacity.
11.6. That this Writ Petition impugns only one of the two partly 11 of 17 allowed orders passed by the Trial Court and order passed below Exhibit “37” which is not challenged in this Petition survives and Suit continues to prevail against Petitioner as Defendant in his personal capacity even if the impugned order is quashed and set aside;
11.7. That it was argued and prayed by the learned Senior Advocate on behalf of the Petitioner before this Court that the Petitioner is not personally liable to any monetary decree in any manner. Hence, such reliefs cannot be granted as there is no such prayer in the present Writ Petition and no case is made out by Petitioner of him not being a necessary or proper party. Also that this Court cannot discharge the Petitioner from the very roots as the Plaintiff being the dominus litis has filed a case with specific averments and such onus ultimately lies on the Plaintiff even if it fails subsequently.
11.8. He would submit that it is a well settled position of law under the scope of Article 227 of the Constitution of India that no interference with respect to the discretion exercised by a Civil Court on whether a person ought to remain as a party to a Suit or not is impermissible and unwarranted especially at the interim stage of a Suit. The above proposition is enumerated in the following decisions of the Supreme Court and this Court and the same is relied upon by Respondents:- 12 of 17
(i) Jai Singh and Ors. Vs. Municipal Corporation of Delhi and Anr.1;
(ii) Shalini Shyam Shetty and Anr. Vs. Rajendra Shankar
(iii) Shri. Bhagwan Dhondiba Nazirkar and Anr. Vs. Shri.
11.9. That without exhausting the existing available remedy in the form of first appeal as under Section 105 of CPC, the power under Article 227 of the Constitution of India cannot be used to challenge each and every error of the Civil Court.
11.10. That the plaint cannot be rejected merely on the basis of defence of Defendant from his written statement and to relieve him from monetary liability would amount to rejection of plaint under Order VII Rule 11 of the CPC.
12. I have heard Mr. Aney, learned Senior Advocate for Petitioner and Mr. Joshi, learned Advocate for Respondent Nos.1, 2 and 3. With their able assistance perused the record and pleadings of the case. Submissions made by them have received due consideration of this Court.
13. From the above pleadings, it is seen that on 26.08.2019, the learned Trial Court passed two separate orders. One order dated
3 Civil WP No.692 of 2000 decided on 01.07.2019 (Bombay High Court) 13 of 17 26.08.2019 was passed in Application filed below Exhibit “37”. This Application was filed by Defendant No.4 – Writ Petitioner before me under Order – I Rule 10(2) of CPC. That Application came to be partly allowed by virtue of which the name of Defendant No.4 i.e. Writ Petitioner before me was directed to be struck off as Defendant No.4 and Managing Trustee of the said Trust. It was further directed by the same order that the Defendant No.4 be impleaded as Defendant No.12 in his personal capacity. The reasons which prevailed with the learned Trial Court to pass the said order are enumerated in paragraph Nos.[7] to 10 of the said order dated 26.08.2019 allowing Application below Exhibit “37”. The principal ground which prevailed upon the learned Trial Court to pass the such an order was that Defendant No.4 had not taken any active part in the transaction between the Plaintiff and Defendant No.1 – Trust. The learned Trial Court opined that the name of Defendant No.4 was used in the said transactions by the Defendant No.1 – Trust and office bearers of Defendant No.1 – Trust who indulged in the said transaction with the Plaintiff. The next most important criterion which weighed with the learned Trial Court for allowing the Application is that the name of Defendant No.4 was consented to be deleted by Defendant No.1 – Trust and Defendant Nos.2, 3, 5 to 11 from the Summary Criminal case which was filed by Plaintiff against Defendant No.5. These specific findings are returned in paragraph No.8 by the learned Trial Court for allowing the name of 14 of 17 Defendant No.4 to be struck out as an office bearer of Defendant No.1 – Trust but it was also directed that Defendant No.4 will be arrayed as Defendant No.12 in his personal capacity.
14. Prima facie, the learned Trial Court found that explanation given by Plaintiff in the proposed amendment sought for in paragraph Nos.3, 4(f) and 5 of Exhibit “74” was not inconsistent with the documents filed on record and by virtue of the proposed amendment it showed that Plaintiff had admitted that Defendant No.4 was not the Trustee of the said Trust. If this be the case then the learned Trial Court ought not to have allowed the proposed amendment but it still went ahead and allowed the Application filed below Exhibit “74” on the basis of the said amendment. If that amendment is allowed to prevail then it clearly runs contrary to the findings returned by the learned Trial Court while allowing Application filed below Exhibit “37”. If the orders passed below Exhibits “37” and “74” are seen it is very clear that the operative part of both the orders are the same but what is important to be noted is that allowing the Application below Exhibit “74” would allow Plaintiff to amend the suit plaint by virtue of which the amendment which is proposed would now bring out a completely new case altogether different from the original case pleaded in the suit plaint by the Plaintiff against the Defendant No.4. that cannot be allowed. 15 of 17
15. The proposed amendment sought for by Plaintiff cannot be a reason to state that it is absolutely necessary to decide the real question. What is sought in the amendment and more specifically in paragraph No.21A to be introduced after paragraph No.21 is that according to Plaintiff, Defendant No.4 is personally liable and therefore he is required to make good the loss of Plaintiff and therefore liable to pay amount jointly and severally. Such an amendment was infact not appreciated by Trial Court while deciding the Application filed below Exhibit “37”. The reasons returned by the learned Trial Court in paragraph No.10 of its order while determining the Application below Exhibit “37” infact run contrary to reasons which are given by the learned Trial Court while determining Application filed below Exhibit “74”. Though clause (2) of the operative part in both the orders determining Exhibits “37” and “74” is the same, the difference is that the amendment has been allowed while determining Application filed below Exhibit “74” and such an amendment if allowed to be prevailed, would clearly change the nature and consequences of the suit proceedings.
16. That apart, allowing this amendment would be also beyond limitation since the said amendment is effected by virtue of Application filed below Exhibit “74” in the month of April – 2019 for the first time when Plaintiff was clearly aware about the factual position in the year 2016 itself when the Defendant No.4 by his written statement had 16 of 17 refuted the charges made in the suit plaint with reasons. From the above discussion and more specifically due to the fact that Defendant No.1 – Trust has now admitted the fact that Defendant No.4 was not a Trustee of the said Trust and his name was inadvertently added by mistake and that too typographically in the resolution which was passed in the year 2008 and which was appended to the Change Report filed by the Trust in the year 2008, the order passed below Exhibit “74” is clearly not sustainable. Therefore it needs to be interfered with. Thus order dated 26.08.2019 passed below Exhibit “74” is quashed and set aside. The Application filed below Exhibit “74” seeking amendment is dismissed. Needless to state that all contentions of parties are expressly kept open in the Suit proceedings strictly in accordance with law.
17. In view of the above observations and findings, Writ Petition succeeds and the impugned order passed below Exhibit “74” is quashed and set aside. Since the Suit is of the year 2016, the learned Trial Court is directed by this Court to decide the said Suit proceedings as expeditiously as possible and in any event within a period of 8 months from today strictly in accordance with law.
18. With the above directions, Writ Petition is allowed and disposed. [ MILIND N. JADHAV, J. ] Ajay