Allowed

Vardhman Developers Limited v. Andheri Krupa Prasad Co-Operative Housing Society Limited and 20 Others

Bombay HC20 Aug 2014CHS/734/2014

Case brief

AI extract

What is this about?

The court allowed a chamber summons for amendment of plaint. It held that a defect in serving mandatory notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960 prior to filing a suit is a formal defect. The plaintiff can serve notice subsequently and amend the plaint by deleting and adding the society. This approach prevents defeating the suit on mere technicalities.

What did the court decide?

Chamber summons allowed for amendment of plaint by deleting and adding the society and incorporating averments of service of notice under Section 164 of the Maharashtra Co-operative Societies Act, 196

Vardhman Developers Limited Vs Andheri Krupa Prasad… — Landlord and Tenant | Bombay HC (2014)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY

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ORDINARY ORIGINAL CIVIL JURISDICTION

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CHAMBER SUMMONS NO.734 OF 2014 IN SUIT NO.94 OF 2014

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Vardhman Developers Limited ...Applicant In the matter between

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Vardhman Developers Limited ...Plaintiff vs Andheri Krupa Prasad Co-Operative Housing Society Limited And Ors. ...Defendants.

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Mr. S.U. Kamdar, Senior Advocate a/w. Mr. Chetan Kapadia, i/b. Kishore Thakordas & Co., for the Plaintiff.

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Mr. Ahmed Abdi a/w. Mr. Satyaprakash Sharma, i/b. Abdi & Co., for Defendant Nos. 2, 3, 4 to 8, 12 to 18 and 20 and 21.

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Mr. Pratik Sakseria a/w. Mr. M. Bhatt, i/b. M. Bhatt & Co., for Defendant No.1.

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CORAM : S.C. GUPTE, J.

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DATED : AUGUST 20, 2014

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P.C. :

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. This Chamber Summons is taken out by the Plaintiff for amendment of the plaint by deleting the name of Defendant No.1 Society from the cause title with liberty to join Defendant No.1 Society as a party Defendant to the suit and amending the plaint by incorporating the necessary averments, which are part of the Schedule to the Chamber Summons. The Applicant/Plaintiff has filed the present suit for specific

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performance for a development agreement and consent terms and supplemental development agreement entered into between Defendant No.1 Society and the Plaintiff. It is the Plaintiff's case in the suit that these agreements are binding on Defendant Nos. 2 to 21, who are members of Defendant No.1 Society. It is the grievance of the Plaintiff in the present suit that Defendant Nos.2 to 21 refused to handover vacant possession of their respective flats to enable the Plaintiff to carry out the work of redevelopment in terms of the development agreement, consent terms and supplemental development agreement referred to above. Plaintiff has, accordingly, sought directions against Defendant Nos. 2 to 21 to handover vacant possession of their respective flats and shift to the transit accommodation by accepting transit compensation, corpus fund and transportation charges payable to members of Defendant No.1 Society in terms of the suit development agreement.

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The present suit was filed without serving a notice required by Section 164 of the Maharashtra Co-operative Societies Act, 1960. Defendant No.13 herein, has taken out a Notice of Motion, being Notice of Motion No.851 of 2014, praying for rejection of the plaint under the provisions of Rule 11 of Order VII of the Code of Civil Procedure on the ground that the suit filed against Defendant No.1 is not maintainable for want of notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960.

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It appears that since the filing of the present suit, the Plaintiff has served a notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960 and has thereupon filed the present Chamber Summons seeking an amendment of the plaint by permitting the Plaintiff to delete the

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name of Defendant No.1 Society from the cause title of the present suit in the first place and simultaneously to add Defendant No.1 Society as a party Defendant, now that the notice has already been served under Section 164 and the statutory period of notice has expired. The Chamber Summons is opposed by Defendant Nos. 3 to 8 and 10 to 21.

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Mr. Kamdar, learned Senior Counsel appearing for the Plaintiff, submitted that the defect in the present suit, as originally filed, namely, want of notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960 is a technical or formal defect and that the Plaintiff has since given the statutory notice required under Section 164 and now seeks to delete and rejoin Defendant No.1 Society as a party Defendant after service of such statutory notice. Learned Counsel submits that this course is permissible as held by the Division Bench of this Court in Sahara India Commercial Corporation Ltd. Vs. M/s. B. Jeejeebhoy Vakharia & Associates¹ , as also a judgment of a learned Single Judge of this Court in the case of Shri Ashok Dattatraya Kulkarni Vs. The State of Maharashtra² .

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On the other hand, it is submitted by Mr. Abdi, learned Counsel appearing for Defendant Nos. 2, 3, 4 to 8, 12 to 18 and 20 and 21 that the defect in the suit on account of want of statutory notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960 is not a formal defect but goes to the root of the matter. Learned Counsel relies on the judgments of this Court in the cases of C.F. Marconi Vs. Madhav Co-Operative Housing Society Ltd.³ and Mohan Meakin Limited Vs. Pravara Sahakari

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1 Appeal No.78 of 2009 decided on 22 April 2009.

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2 Chamber Summons No.862 of 2013 decided on 3 April 2014.

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3 1985(2) Bom.C.R. 357

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Sakhar Karkhana Ltd.⁴ in support of his case that a suit instituted without notice under Section 164, ought to be dismissed. Learned Counsel further submits that by an amendment made to the objects Clause 7 of Defendant No.1 Society (amendment brought in 2014 before the filing of the present suit), redevelopment of the building of Defendant No.1 Society has been made an express object of the Society and thus, forms part of the business of the Society. Learned Counsel submits that accordingly, it was mandatory to issue a notice under Section 164 of the Maharashtra Co-operative Societies Act.

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The Division Bench of this Court in the case of Sahara India Commercial Corporation Ltd. was concerned with a similar application by way of a Chamber Summons. In that case, a suit was originally instituted against a Co-Operative Societies Act, 1960. After the maintainability of the suit was objected to by the defendants in that suit on the ground of want of notice under Section 164 of the Act, the plaintiff filed a Chamber Summons praying for a similar relief in the following terms :-

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“(i) Permit the Plaintiff to delete Defendant No.4 from the suit and allow the amendment as per schedule annexed hereto and add Defendant No.4 again to the suit.”

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A learned Single Judge of this Court rejected the prayer and the matter was carried in appeal before the Division Bench. The Division Bench inter alia noted the provisions of Order XXIII Rule 1(3), which is in the following terms :-

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“XXIII Rule 1

(3) Where the Court is satisfied -

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(a) that a suit must fail by reason of formal defect, or

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(b) that there are sufficient grounds for allowing the plaintiff to institute a fresh suit for the subject matter of a suit or part of a claim,

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it may, on such terms as it thinks fit, grant the plaintiff permission to withdraw from such suit or such part of the claim with liberty to institute a fresh suit in respect of the subject-matter of such suit or such part of the claim.”

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On a consideration of the relevant provisions, the Division Bench noted that the plaintiff in an appropriate case i.e., where, according to the plaintiff, there is a formal defect in the suit or there are sufficient grounds for allowing the plaintiff to institute a fresh suit on the same cause of action, may withdraw the suit with liberty to institute a fresh suit in respect of the subject matter of such suit. The Division Bench noted that in the case before it admittedly no notice was given under Section 164 when the suit was instituted and that in view of the objections raised to the maintainability of the suit for want of such notice, the plaintiff had served this notice and thereafter by an application for amendment of the plaint sought to delete the defendant society and simultaneously add the defendant society with averments concerning the service of statutory notice on the defendant society in the interregnum. This Court, after considering the judgments in this behalf, held as follows :-

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Our laws and procedures are based on the principle that as far as possible, no proceeding in a court of law should be

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allowed to be defeated on mere technicalities. Thus, the submission of the learned counsel for the plaintiff was that, that the procedural laws cannot be interpreted in such a way so as to defeat the main object of justice and, therefore, a substantial compliance of those provisions is a sufficient compliance, the object being to give information to the said statutory body or Government or the public officer, information about the cause of action and the nature of the suit which he is likely to face. Therefore, the learned senior counsel submitted that though on the date of the filing of suit the notice under section 164 of the MCS Act was not given, yet by way of abundant precaution in view of the objection of the defendants, the said notice was given and after the maturity of the said notice, the plaintiff is trying to remove a formal defect in the suit.”

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What we find is that the procedure required to be followed should be such that interest of justice furthers and makes progress. It cannot be allowed to be used in such a manner which will frustrate the interest of justice. In the present matter, the defect which has been pointed out viz. non compliance of section 164 of the MCS Act is a formal defect. Therefore, the plaintiff is taking abundant precaution not to allow to frustrate his cause of action for such a technicality in law, though the plaintiffs comes with an assertion and still assets that the notice under section 164 is not necessary. Therefore, relying upon the judgment of this Court in AIR (32) 1945 Bom. 74 (supra), we are inclined to allow the Chamber Summons. We do not agree with the learned single Judge that all this has been done by the plaintiff purely with an intention to circumvent the provisions of law. On the contrary, the plaintiff is trying to carry out all these amendments in order to overcome the objections raised by the defendants, which, at a point

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of time and for a limited purpose, were waived by the defendants also. Therefore, if the plaintiff is taking precaution to protect his suit by overcoming the objections which have been raised by the defendants maintaining the initial stand taken by the plaintiff, we do not find that there is any intention to circumvent the provisions of law and thus we do not approve the observations made by the learned single Judge to that effect.

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In that view of the matter, the Division Bench allowed the plaintiffs/appellants' application for amendment of the plaint.

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In Ashok Dattatraya Kulkarni (supra), a learned Single Judge of our Court allowed a similar amendment. The Court in the case of Ashok Dattatraya Kulkarni noted that instead of withdrawing the suit and then filing a fresh suit in the same case after service of the statutory notice and expiry of the notice period, the plaintiff in that suit sought to amend the plaint by deleting the name of defendant No.5 society from the cause title in the fist place and adding its name simultaneously in the cause title after carrying out the amendments proposed in the Chamber Summons. The Court found this course perfectly in order.

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It is clear from the law laid down by our Court in the case of Sahara India Commercial Corporation Ltd. (supra) and followed by a learned Single Judge of our Court in the case the of Ashok Dattatraya Kulkarni (supra) that it is permissible to the plaintiff in a case where a suit is filed against a society without notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960, to give such notice subsequent to the filing of the suit and amend the suit thereafter by deleting

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and simultaneously adding the defendant society and incorporating averments in respect of the statutory notice served in the interregnum.

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The judgments under Section 164 cited by Mr. Abdi on the business of the Society and the requirement of statutory notice under Section 164 of the Maharashtra Co-operative Societies Act, 1960 are besides the point. There is no quarrel with the proposition that wherever the matter touches on the business of the Society and statutory notice under Section 164 of the Maharashtra Co-operative Act, 1960 is not given, the suit is liable to be dismissed for want of its maintainability. The judgments do not consider the question whether in an appropriate case the plaintiff should be allowed to serve such statutory notice after filing of the suit and then move an amendment for simultaneous deletion and addition of the defendant society. That is considered by our Court in the case of Sahara India Commercial Corporation Ltd. (supra) and Ashok Dattatraya Kulkarni (supra), as noted above.

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In the premises, the Chamber Summons is allowed in terms of prayer clauses (a) and (b). The amendment to be carried out within a period of two weeks from today. There shall be no order as to costs.

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The application of the learned Counsel for the Defendants for stay of this order is rejected.

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( S.C. GUPTE, J. )

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Vardhman Developers Limited v. Andheri Krupa Prasad Co-Operative Housing Society Limited and 20 Others

Case brief

What is this about?

What did the court decide?

Vardhman Developers Limited v. Andheri Krupa Prasad Co-Operative Housing Society Limited and 20 Others

Case brief

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