Partly allowed

All India Handloom Fabrics Marketing Co-Op Society Ltd. v. M/S Evans' Fraser and Co(India) Ltd.

Bombay HC28 Mar 2016APP/403/2016

Case brief

AI extract

What is this about?

The High Court allowed in part the appellant's appeal against a Single Judge's order dismissing a Chamber Summons seeking amendment of plaint. The Court quashed the impugned order, permitted the amendment subject to excluding a specific prayer, and kept issues of limitation and maintainability open for trial.

What did the court decide?

Impugned order quashed; Chamber Summons made absolute to permit amendment excluding prayer clause (e-5).

All India Handloom Fabrics Marketing Co-Op… — Contract and Commercial Disputes | Bombay HC (2016)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
APPEAL (L) NO.717 OF 2014

¶5

The All India Handloom Fabrics
Marketing Cooperative Society Ltd. ...Appellant
vs.
M/s.Evans' Frazer Co.(India) Ltd. ...Respondent

¶6

Mr.Neveille Mukerji i/b Veritas Legal for the
appellant

¶7

Mr.Shailesh Rajda i/b M/s.DSR Associates for the
respondent

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CORAM : A.S.OKA, &
 P.D.NAIK,JJ.

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 DATE : MARCH 28, 2016

¶10

ORAL JUDGMENT: (PER A.S.OKA,J.)

¶11

1The submissions of the learned counsel for the
parties were heard in the last week. The order
dated 28th January 2015 directs that the appeal shall
be disposed of finally at the stage of admission.

¶12

2By this appeal, the appellant-original
plaintiff has taken an exception to the Order dated
16th September 2015 passed by the learned Single
Judge on a Chamber Summons taken out by the
appellant. For the sake of convenience, the parties
are referred in this order with reference to their
status before the Trial Court.

¶13

3By the Chamber Summons No.607 of 2013, the
plaintiffs sought leave to amend the plaint. By
the impugned order, the Chamber Summons has been

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dismissed.

3With a view to appreciate the submissions made
by the learned counsel for the parties, a brief
reference to the facts of the case will be
necessary. Initially, the present suit was filed by
the plaintiffs in the Court of Small Causes at
Mumbai. The defendants are the owners of the
building known as Fort House, D.N.Road, Mumbai.
According to the case of the plaintiffs, in the year
1956, they were granted permission to occupy the
ground floor of the said building admeasuring 7000
sq ft on Leave and Licence basis. Subsequently, an
area of 3474 sq ft on the rear side was permitted to
be occupied by the plaintiffs. The total area in
possession of the plaintiffs was 10,474 sq ft. It
is stated that initially Leave and Licence was
granted for a period of 5 years which was extended
by a further period of 5 years.

¶18

4In October 1982, a major fire broke out in the
building in which substantial part of the building
was destroyed.

¶19

5The plaintiffs filed a suit against the
defendants and Mumbai Municipal Corporation in the
City Civil Court, Mumbai. The case made out in the
plaint was that the plaintiffs and the defendants
have carried out repairs to the said building and
that the plaintiffs offered to contribute towards
cost of construction of the portion of the building
which was in their possession. It is alleged that a

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sum of Rs.10,00,000/- was paid by the plaintiffs to
the defendants.

¶22

6Thereafter,therewasaprolonged
correspondence between the parties. The appellants
filed a present suit being RAD Suit No.1436 of 1999
in the Court of Small Causes at Mumbai. In the said
suit, the plaintiffs relied upon the consent terms
filed in RAD Suit no.925 of 1996 filed by them
against the defendants. Some of the relevant
clauses in the said consent terms are clauses 1,
4,4a read thus:

¶23

“1Agreed and declared that prior to the
destruction by fire of the building known as
Fort House situate at 221, Dr. D.N. Road,
Fort, Bombay 400 001, the plaintiffs were
occupying since 1956 a portion on the ground
floor of the said Fort House having an area
of about 10,474 sq ft as the monthly tenants
of the defendants at the monthly rent of
Rs.11,200/-

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2...

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3...

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4Agreed and declared that in lieu of and
in substitution for the monthly tenancy of
the premises having built up area of 8380 sq
ft in the re-constructed building as provided
in clause 3 above, the defendants hereby
agree and undertake to give to the plaintiffs
on ownership basis free of cost of

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construction the possession of the premises
on the ground floor with proper frontage in
proportion to the frontage the plaintiffs
were enjoying all along till the property was
destroyed by fire, on the left hand side of
the said building Fort House while entering
the same viz towards the property known as
Badri Mahal, Jeejeebhai Dadabhai Lane to be
reconstructed by the defendants having a
built up area of 5100 sq ft.

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4(a)It is further agreed that the plaintiffs
will not claim any monthly tenancy rights as
provided in clause 3 above and that the said
monthly tenancy rights of the plaintiffs
under clause 3 above will stand merged in the
ownership rights of the plaintiffs as
provided in clause 4 about but instead of
8380 sq ft built up area the defendant will
give built area of 5100 sq ft on ownership
basis.

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5Agreed and declared that the re-
constructions of the building by the
defendants shall be in accordance with the
building plans approved by Municipal
Corporation of Greater Bombay and the said
building will be completed with reasonable
despatch and unless prevented by the factors
beyond the control of the defendants, the
defendants agree and undertake to give
possession of the said premises admeasuring

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5100 sq ft built up in the said re-
constructed building on the ground floor with
proper appropriate and proportionate frontage
as agreed to be given by or before June 2001
or earlier as may be possible and such
possession shall be given to the plaintiffs
by the defendants before the defendants give
possession to any other party or person or
before the defendants themselves start using
and occupying any portion in the said re-
constructed building. The intent being that
the defendants shall first secure the
possession of the said agreed premises to
the plaintiffs before allowing others or
themselves to occupy the said reconstructed
building.”

¶34

7The first prayer in the suit was that the
consent terms/agreement dated 19th August 1996 filed
in the Court of Small Causes in RAD Suit No.921 of
1996 is still valid, subsisting and binding
enforceable contract by and between the parties to
the suit. The second prayer is for declaring
clauses 8 and 12 of the consent terms as null and
void.

¶35

8It appears that an objection to the
jurisdiction of the Court of Small Causes to
entertain the said suit filed by the plaintiffs was
raised by the defendants. By the Judgment and Order
dated 18th December 2007, the Court of Small Causes
dismissed the suit by observing that the suit was

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not maintainable and that the said Court has no
jurisdiction to entertain the suit. An appeal was
preferred by the plaintiffs before the Appeal Bench
of Court of Small Causes. By Judgment and Order
dated 5th December 2012, the said appeal was partly
allowed. The Appeal Bench while holding that the
Court of Small Causes had no jurisdiction to
entertain the suit directed to return the plaint for
presentation before the appropriate Court.
Thereafter, on 1st March 2013, the plaintiffs filed
the plaint in this Court. It is claimed that the
plaint was filed as it is without making any
material amendments.

¶38

9By the Chamber Summons on which impugned order
has been passed, the plaintiffs sought amendment of
plaint for incorporating additional averments and
prayers. One averment which is sought to be added
was that as per the terms of the said consent
terms/agreement, the plaintiffs are entitled to
possession of the premises admeasuring 5100 sq feet
on ownership without payment of any monitory
consideration. A prayer to that effect was sought to
be added. In the alternative, a prayer was sought
to be added seeking a decree directing the
defendants to provide to the plaintiffs an area of
8380 sq ft on the pre existing rental basis on the
ground floor in the newly constructed building. By
way of amendment, a prayer was sought to be
incorporated for an injunction restraining the
defendant from giving away or parting with the
possession of the premises admeasuring 8380 sq ft

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including 5100 sq ft on the ground floor in the
front side of the newly constructed building. The
another prayer sought to be added is of a decree for
possession directing the defendants to place the
plaintiffs in possession of the premises admeasuring
5100 sq ft on ownership basis or the premises
admeasuring 8380 sq ft on tenancy basis. A prayer
was sought to be incorporated directing the
defendants to pay compensation at Rs.11,200/- per
month from 1st July 2001 till the plaintiffs are
placed in possession of the premises in newly
constructed building. Prayer (e5) was also sought
to be added. However, the learned counsel for the
appellants on instructions stated that the
appellants are not pressing for incorporation of the
said prayer.

¶41

10The learned Single Judge while passing the
impugned order observed that all the prayers which
are sought to be added by way of amendment ought to
have been made in the original suit. The learned
Judge held that evidence has been led on all
material issues and therefore, the plaintiff is
cannot get an opportunity to lead new evidence,
thereby possibly improving upon the case already
made out before the Court of Small Cases.

¶42

11The learned Senior Counsel for the appellants
submitted that in the suit for declaration filed by
the plaintiffs the prayers are sought to be added
for consequential reliefs. He submitted that only
because evidence was adduced before the Court of

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Small Causes, it cannot be said that the suit is partly heard before this Court. His submission is that the trial will have to be conducted de novo as there is a concluded finding that the Court of Small Causes had no jurisdiction to entertain the suit. His submission is that the findings recorded by the Court of Small Causes are the findings by the “Coram non judis”. He urged that the reasons given by the learned Single Judge for rejecting the prayer for amendment have no basis as the amended provisions of the Code of Civil Procedure, 1908 will not apply to the original suit which was filed in the year 1999. Moreover, it cannot be said that the suit is part heard.

¶45

12The learned senior counsel representing the
respondents pointed out that the prayers sought to
be incorporated are time barred. Secondly, he
submitted that the prayer sought to be added by way
of prayer clause (e-4) for compensation from 1st July
2011 contains inadvertent mistake, as in the
proposed paragraph No.30A of the plaint, it is
contended that the compensation at the rate of
Rs.11,200/- per month is payable upto 30th June 2001
and not from 2011. He submitted that apart from the
fact that the proposed amendments will change the
entire nature of the suit, proposed amendments are
barred by limitation. He submitted that the very
fact that the plaintiffs were forced to file a suit
for recovery of possession shows that the possession
of the defendants of the premises claimed by the
plaintiffs has become adverse to the plaintiffs and

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therefore, by virtue of Article 65 to the Schedule
to the Limitation Act,1963, the prayer for
possession is completely time barred.

¶49

13We have given careful consideration to the
submissions. As far as amended provisions of said
Code of 1908 and in particular Rule 17 of Order VI
are concerned, after the institution of the suit in
this Court, the same has not reached the stage of
hearing. The evidence was recorded before the Court
of Small Causes which ultimately held that the said
Court had no jurisdiction to entertain the suit.
Therefore, in any event, it cannot be said that the
Chamber Summons for amendment was moved after the
trial commenced.

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14We have already adverted to the prayers made in
the plaint and relevant clauses of the
agreement/consent terms sought to be relied upon by
the plaintiffs. When the suit was filed, the
building was not reconstructed. In the suit, the
substantive prayer was for declaration that the
consent terms/agreement dated 20th August 1996 are
valid, subsisting and binding enforceable contract
by and between the plaintiffs and the defendants.
Now, we must make a reference to the prayers sought
to be added by way of amendment. Prayer (e-1) is
for perpetual injunction restraining the defendants
from parting with possession of the premises agreed
to be allotted to the plaintiffs. Prayers (e-2) and
(e-4) which are material read thus:

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(e-2)That the defendants may be ordered
and decreed to hand over possession of the
suit premises namely 5100 sq ft on ownership
basis or 8380 sq ft on tenancy basis as per
said Consent Terms dated 20th August 1996.
(e-3)...

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(e-4)The defendants may be ordered and
decreed to pay the compensation at
Rs.11,200/- p.m from 1st July 2011 till
possession is given to the plaintiffs as
compensation for the period the plaintiffs
are kept out of and deprived of possession of
the premises in the new building Fort House,
reconstructed by the defendants.”

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15The prayer (e-3) is for ad-interim relief in
terms of prayers (e-1) and (e-2). As far as the
prayer (e-2) is concerned, the limitation will start
running from the date on which the possession of the
defendants of the premises in question becomes
adverse to the plaintiffs. The issue of bar of
limitation is a matter for trial. As far as prayer
(e-4) is concerned, we are not on the question
whether there is a typographical error in the
prayer. Suffice it to say that prayer (e-4) is a
consequential prayer to prayer (e-2). On plain
reading of the said prayers, it cannot be said that
when the Chamber Summons was taken out on 20th July
2013, the prayers e-2 and 3-4 were was barred by
limitation.

¶56

16In any event, even if amendment is permitted,

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the issue of bar of limitation of the prayers in the
amended plaint always remains open.

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17The learned Single Judge has not considered the
merits of the Chamber Summons. He observed that the
evidence has been already led on material issues.
As stated earlier, the said evidence is adduced
before the Court of Small Causes which had no
jurisdiction. Therefore, there was no impediment
in the way of deciding the Chamber Summons on merits
especially when the recording of evidence before
this Court had not commenced.

¶60

18In our view, the Chamber Summons ought to have
been made partly absolute by permitting the
amendment as sought, except the prayer clause (e-5).
To that extent, the Appeal must succeed.

¶61

19Hence, we pass the following order:

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(I)Impugned order dated 16th September 2014 is
hereby quashed and set aside and the Chamber
Summons No.607 of 2013 is made absolute in
terms of prayer clause (a);

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(II)We however make it clear that the
plaintiffs are not entitled to incorporate
prayer clause (e-5) which is sought to be added
by way of amendment;

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(III)We make it clear that the issue of
maintainability of the added prayers as well as
the issue of bar of limitation in relation to
amended prayers is expressly kept open;

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(IV) Appeal is partly allowed on above terms;

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(V) We make it clear that we have made no adjudication on the merits of the controversy in the pending suit.

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(VI) Amendment shall be carried out within a period of three weeks from the date on which this Judgment and order is uploaded on the website of this Court.

¶69

(P.D.NAIK,J.)

All India Handloom Fabrics Marketing Co-Op Society Ltd. v. M/S Evans' Fraser and Co(India) Ltd.

Case brief

What is this about?

What did the court decide?

All India Handloom Fabrics Marketing Co-Op Society Ltd. v. M/S Evans' Fraser and Co(India) Ltd.

Case brief

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What did the court decide?

What the court decided

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