The High Court dismissed a petition challenging the Additional District Judge's order granting leave to defendants to amend their written statement in a suit for injunction, rejecting the claim that the amendments altered the suit's structure.
The petition challenging the amendment of the written statement was dismissed.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF HIMACHAL PRADESH SHIMLA
CMPMO No. 227 of 2014 Date of Decision: 08/04/2015
Sunil Kumar Bansal & another …..Petitioners
Versus K.T.S Educational and Charitable Trust …& others. ….Respondents.
K.T.S Educational and Charitable Trust …& others.
Coram:
The Hon’ble Mr. Justice Sureshwar Thakur, Judge .
Whether approved for reporting?1 Yes.
For the petitioners: Mr. S.D Gill, Advocate. For the Respondents: Mr. Neeraj Gupta, Advocate, for respondents No. 1 and 3.
Sureshwar Thakur, J (oral)
The plaintiffs/petitioners herein are aggrieved by the order rendered by the learned Additional District Judge, Solan, on an application preferred by the defendants/ respondents No. 3 and 4, herein before him under Order 6 Rule 17 C.P.C, claiming leave of the learned Additional District Judge, Solan, to incorporate certain amendments in the written-statements of defendants No. 3 and 4. Alongwith the application, the amended written statement was
1 Whether reporters of the local papers may be allowed to see the judgment?
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also filed. The leave, as prayed for, was granted. The proposed amendments to the written-statement of the defendants concerned exist in paragraph 5 of the application filed under Order 6 Rule 17 CPC. Since an inference and conclusion is to be drawn by this Court whether the amendments as proposed to be incorporated in the written-statement of the defendants concerned and as exist in paragraph 5 of the application alter its structure and character from the one as initially projected in the written-statement of the defendants concerned, or, whether the proposed amendments are merely an endeavor to clarify certain ambiguities occurring in the written-statement previously instituted by the defendants concerned, it is deemed apt to extract in verbatim paragraph 5 of the application under Order 6 Rule 17 C.P.C:-
“ The trust has been constituted vide deed dated 21.6.1997 registered with sub Registrar, Solan on 19.7.1997, the nature of the trust is matter of conclusion to be drawn on the basis of trust deed. It will not be out of place to submit humbly that no contribution from the general public has been obtained.
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In para 4 on merits of the written statement in 10th line after word Prem Goyal word sold has been used, the applicants intend to substitute word sold by transferred”. in the end of this para, the applicants intend to add:
“on account of resign by Mrs. Santosh Garg, Parmod Singla and Shri Prem Goyal new trustees i.e defendant No. 3 to 5 were inducted as trustee”.
In para-5 of the written statement in 3rd line after 1st word 3 word purchased interest has been used, the applicants intend to substitute word purchased by the following:-
“Made it possible and met with the conditions of resign and leaving of trust by Smt. Santosh Garg, Sh. Parmod Singla and Shri Prem Goyal and due to this reason got right and choice to have 3 trustees on the Board.”
In para-5, after words accordingly a written agreement was created it is mentioned, “Rs. 3.70 crore was fixed consideration to be paid by defendant No. 3”, these words are intended to be substituted:-
“Rs. 3.70 crore was advanced by the defendant No.3 to the Trust
to bail out the trust out of the crises.”
During pendency of suit Shr. T.R Bansal has transferred his rights in favour of smt. Balninder Kaur and has submitted resignation from the Board of Trustee, this fact is intended to be pleaded by adding following in end of para-9:-
“However, Sh. T.R Bansal has transferred his rights and resigned from the post of trustee and smt Balninder Kaur has been included as a Trustee in Board of Trustees. It is humbly submitted that the financial health of the trust could not improve due to acts of the plaintiffs due to which various trustees have been leaving their post after taking away their membership contribution and other monies advanced to the trust”.
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In para-12 in the first line words” amount of their share in the trust” have been used, these words are intended to be replaced by:
“that after receiving amount of their share/membership contribution and further amounts advanced”
In the end of para-26 the applicants intend to add:-
“The defendants No. 3 to 5 have been spending much time in India to look after the affairs of the trust. Moreover, on account of new scientific and technological advancement the meeting of board of trustees can be held even by way of circulation video conference/meeting.”
The applicants further intend to bring the acts and conduct of the nonapplicants/plaintiff, after dismissal of the suit vide order 19.5.2008, when the management of the trust and school was taken over by the 2/3rd majority of the trustee and affairs were checked, the following misdeeds of the non-applicants/plaintiffs transpired subsequently the suit has been restored. The following facts have come to knowledge of the applicants during pendency of suit, as such the applicants intend to add the following in the end of para-30:-
“The plaintiffs have not been pumping their money in the school and on the contrary have been causing loss and injury to the trust by their acts, conduct , deeds and omissions etc. etc. some of them are detailed as under:-
(i) The main work which the trust had been executing is running of KTS Public School, year-wise strength of the student in the school tells a lot about the mismanagement of the affairs of the trust afater dismissal of the suit, when the 2/3rd majority of the trustees checked the affairs of the trust and further in accordance with the terms of MOU authorized Sh. Jitender Singh to manage and look after the management, only 6 students were found on the rolls of the school and only 2 teachers were working in the school.
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Art of Living Association had to be got vacated after having negotiations under stress and strains, even police had to intervene in the said matter.
(v) The plaintiffs have cut and removed 7 big chil/pine tress the logs and wood after cutting the tress, the timber has been misappropriated, only small portion of the timber was found in dome No.3, the matter was reported by the defendant No.3 to the Divisional Forest Officer, Solan. On receipt of information Divisional Forest Officer, Solan, summoned plaintiff No.1, the plaintiff No.1 made false statement to said official, stating that these trees were damaged by termite and fell down of their own. With regard to same tress, the plaintiffs filed affidavit in the Hon’ble High Court of HP wherein plaintiffs stated that these tress have been cut by them after obtaining permission from concerned officials during the construction of the school in the year 2005. The building of the school has been constructed in the year 1998-99. The DFO solan has informed the replying defendants that no permission has ever been obtained by the plaintiff for cutting and removing trees. The plaintiffs have been causing damage to the trust property and misappropriating the same.
(vi) Besides causing loss of Rs. 53,00,000/- the plaintiffs have removed major portion of metal fence of the school alongwith metal postures (Angle irons), approximately 100 door/window frames ventilator frames, furniture, chairs gas cylinder, science equipment kept in the school and tour iron bars/saria has also been found to have been removed, the plaintiffs have misused the same so as to have undue benefit.
(vii) Four tv Sets have also been removed from the school premises. In earlier 2002, a contract was granted for metaling of parking in front of school gate. Amount of Rs. 60000/- (Rupees Sixty
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thousand) was paid in advance to the contractor. After bringing some material, equipment and road roller, the contractor fled away without performing his part of contract and the plaintiffs sold coal Tar Drums. Tar Melting Machine and road roller and pocketed the money, the persons who are witness to such wrong acts can be produced by the replying defendants in the Hon’ble Court.
(viii) The plaintiffs failed to make payment of electricity bills of the school, electricity supply has been disconnected w.e.f 23.9.2008, the plaintiffs paid only amount of Rs. 10,000/(Rupees Ten Thousand) against one bill out of Rs. 47,890/further the plaintiffs failed to pay electricity bill with regard to dome and mess building and as such failed to make total payment of Rs. 63,060/- said amount at present had to be paid by defendant No.3 and this liability has been fastened on the trust by the plaintiffs. Payment of the electricity bills was necessary so as to make effort to run the school and meet other objectives of the trust.
(ix) The plaintiffs have employed staff at lesser amount of salary what was being shown in the record of the trust. After making payment to the staff, the plaintiffs have been taking back portion of the amount paid, the witnesses to said effect can be produced by the replying defendants. A letter dated 7.4.2005 signed by the plaintiff Sunil Kumar Bansal and Principal as a salary of staff for the month of 2005 shows crediting of Rs. 61,200/- in the account of the employees of the school, but on the reverse of the letter plaintiff No.1 has with his own hand writing shown that actual pay of the staff for the said month as paid is Rs. 48, 900/-.
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Jatin Sehran and Shivangi verma who were not students of KTS Public School were allowed to reside in the school premises, these students have informed replying defendant No.3 that they have been making payment for boarding and lodging @ Rs. 25,000/-p.a.
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such payment to his wife. Besides this, plaintiff No.1 and his wife have connived with Sh. T.R Bansal, Ex Trustee so as to charge Rs. 3,000/- from each student of the KTS School under the pretext of providing internet information.
(xv) The plaintiffs have been extracting money from various persons after alluring them to have benefits from the trust. The plaintiffs received amount of Rs. 30,00,000/- (Rupees thirty lacs) from Sh. Rakesh Bansal and Smt. Balbir Kaur after representing that they are the only trustees and if amount is paid to them, the above mentioned person would be made trustees and in future various types of benefits will be available to the trustees from the trust as the school is likely to run in very good manner and generate heavy income, after finding that they have been cheated sh. Rakesh Bansal and Smt. Balbir Kaur have lodged FIR No. 242 dated 18.9.2007 with P.S Solan. According to information of replying defendant a case has been put in against the plaintiffs in the Court of law.
(xvi) In the year 2002, the trust was to make payment of Rupees one Crore so as to clear the liabilities/debts. At that time it was decided that all the six trustees should make arrangement of money payment of approximately Rs. 16,66,666/- each so as to clear the liability. As defendant No.3 and 3 other trustees were having one line of thought and plaintiffs were having other line of thought finally agreed that replying defendant No.3 will advance amount of Rs. 65,00,000/- as loan to the trust and the plaintiffs will pay Rs. 35,00,000/- so as t clear the liability of Rupees one crore/ The defendant N.3 made payment of Rs. 65,00,000/- approximately to the trust by depositing the same in the loan account of the trust kept and maintain with Indus Bank, Chandigarh. Despite of time and again request, the plaintiff failed to make payment of Rs. 35,00,000/- and on
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account of this amount having remained standing. The interest continued to increase the liability of the trust. This conduct of the plaintiffs caused great loss and injury to the trust. The amount of Rs. 35,00,000/- increased to amount more than Rupees one crore. Xvii) On account of above mentioned liability of more than Rupees one crore, the Indus Bank filed a case before Debt recovery Tribunal, Chandigarh the matter was decided in favour of the Bank, an appeal was preferred by the plaintiffs before Debt Recovery Appellate Authority Tribunal, Delhi, when replying defendants came to know about said proceedings, moved an application for become party to the appeal. The plaintiffs acted with culpable negligence and did not pursue the mater property, due to which the appeal was dismissed and the Bank became entitled to take over possession of the trust property on 21.1.2008 After dismissal of the appeal, the plaintiffs contacted defendant No.3 to bail out the trust, after negotiations etc. all the trustees arrived at an understanding and MOU and agreement came into existence. In pursuance of the MOU the defendant No.3 took initiative to save the trust property and succeeded in getting one time settlement for Rs. 1,01,00,000/- (Rs.One crore & one Lac). Out of this amount the defendant has paid amount of Rs. 91,00,000/- (Rupees Ninety one Lacs) and plaintiffs got amount of Rs. 10.00.000/- (Rupees ten lacs) adjusted from the account of their sisters kept and maintained with the Indus Bank. Had the plaintiffs made payment of Rs. 35,00,000/- earlier, the liability of Rs. 1,01,00,000/- would not have been fastened on the trust, the plaintiffs have never acted in the interest of trust but on the contrary have always been trying to take undue advantage and gain. The amount has been paid on above
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mentioned dates and the same was to be returned alognwith interest, but till today not even a single penny has been returned on the contrary the trust property has been damaged in such a manner that in order to run the school and other projects of the trust heavy amount would be required.
(xvii) in the year 2002, replying defendant was made trustee of the trust. Thereafter the plaintiffs and other three trustees i.e. all remaining trustees requested the replying defendant to advance amount of Rs. 50,00,000/- (one Lac US Dollars) to the trust, this amount was also returnable by the trust alongwith interest. Till today no amount against said head has been returned to the replying defendant No.3 there has been gross financial mismanagement on the part of the plaintiffs, had replying defendant No.3 not advanced money from time to time, the property of the trust would have been sold and the trust would have come to an end. Now the plaintiffs are again trying to have undue advantage and gain.
(xviii) Payments to various employees has not been made and they have got legal notices issued to the trust and defendant No.3 this act has brought bad name of the trust.
(xix) Payment to various local shop keepers has not been made and they have also issued notices to the trust and defendant No3. All these facts have caused loss, injury and prejudice to the trust. The applicants further intends to change 3rd and 4th lines of para 32 by substituting the same as under:-
“Trustees, There exist no situation where under the
Hon’ble Court may have to exercise the discretion to appoint trustees. The trust is being managed on the basis of decisions taken by majority of the trustees, the replying defendants assure the Hon’ble Court that the trust will be run as per trust deed and after taking decisions in board of trustees.”
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Santosh Garg, Parmod Singla and Prem Goel had sold their rights in the Trust to defendant No. 3”, however by way of the proposed amendment the defendants No. 3 and 4 desire to in dire contradiction thereto plead/contend in the written-statement that “ on account of resign by Ms. Santosh Garg, Parmod Singla and Prem Goel (defendants No. 3 to 5) were inducted as trustee”. Further more it is also contended that in the original writtenstatement of the defendants No. 3 and 4, they had projected the contention “that defendant No. 3 purchased the interest of trustees Santosh Garg, Parmod Singla and Prem Goel and in their place nominated defendants No. 3,4 and 5 as trustees and Rs. 3.70 crores was fixed consideration to be paid by defendant No.3” whereas now by way of the proposed amendment defendants No. 3 and 4 want to contend that “with the condition of resign and leaving of Trust by Ms. Santosh Garg, Parmod Singla and Prem Goel, defendant No.3 got right and choice to have three trustees of the Board and Rs. 3.70 crore was advanced by defendant No.3 to the Trust to bail out the Trust out of the crises.”
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striking of issues. It was at a stage, prior to the striking of issues when the application at hand had come to be instituted before the Court concerned. The substitution in the status, character of defendant No.1, as, proposed in application under Order 6 Rule 17 in as much as it having been contended therein that the learned Additional District Judge, Solan permit the defendants concerned to alter its status and character from the one contended in the previous written/statement to be its being a Charitable trust to its rather being a partnership firm would not in any way preclude, prejudice or affect the rights of the plaintiffs to claim injunction in case relief of injunction is proven to be affordable by apposite evidence as may come to be adduced by the plaintiff on the relevant issue as would be struck by the court where the suit is pending. Further more, the appropriate and the apt nomenclature of or the apt status and character of defendant No.1 would facilitate the plaintiffs to claim relief of injunction in case evidence on record as adduced before the learned trial Court permits rendition of a decree for injunction in their favour, besides, it would preclude any objection qua mis-nomenclature of necessary parties. Consequently, way for facilitating rendition of an
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executable decree, would hence be opened by an appropriate status and character of defendant No.1 being permitted to be reflected. Obviously, any substitution of the status / character of defendant No.1 by replacement of the hitherto status and character though may be diverse inter-se the one projected in the original written-statement, and as now proposed it would also facilitate the plaintiffs/petitioners herein to establish their right for claiming injunction, against the appropriate reflected defendants, especially when the suit is at a pre-issue stage as also when it would facilitate the plaintiffs to on the apposite issue as would be struck hereinafter obtain relief. Consequently, in face thereof, the argument as projected by the learned counsel for the plaintiffs/petitioners herein that the dire alteration or substitution in the status and character of the defendant No.1 is impermissible stands to be discountenanced. Further more, even if, in the original written-statement, it has been contended therein that the induction of defendants No.3 to 5 as trustees is for the reason that the trustees and founders of the trust, namely, Santosh Garg, Parmod Singla and prem Goel had sold their rights in the trust to defendant No.3, however by way of the proposed amendment, it
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has been contended that on account of resignation of Santosh Garg, new trustees defendants No. 3 to 5 were inducted as trustees. Even the aforesaid alteration or substitution in the extantly instituted application under Order 6 Rule 17 C.P.C qua the manner of acquisition of rights by defendants No. 3 & 4 in defendant No.1 would not in any way affect or impinge upon the rights of the plaintiffs/petitioners herein to claim the relief of injunction against the defendants No.3 and 4, especially when their appropriate capacities have been unfolded in the application under Order 6 Rule 17 CPC. Consequently, when the appropriate capacities of defendants No. 3 and 4 would come to be reflected in the appropriate paragraph of the written-statement, therefore, such reflection would facilitate the rendition of a tenable and executable decree against them. Furthermore the reasons as attributed hereinabove by this Court for concluding that the proposed amendment would facilitate the rendition of a tenable and executable decree against the defendants especially when their appropriate and apt capacities as proposed to be reflected in the proposed amendment comes to be reflected in the appropriate paragraph of the written-statement. In sequel, for reiteration, it
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forestalls the submission of the learned counsel for the petitioners herein, that the amendments are uncalled for as they would erode the character and grossly alter the substratum of the capacities of the defendants concerned. Rather the amendments are apt and germane besides relevant for enabling the learned court concerned to frame appropriate issue on which the party defendants in their appropriate capacities, would be, subject to the onus as cast on them adduce their respective evidence. Besides, the amendments being rather of a clarificatory nature besides erasing ambiguity qua the capacities of the defendants were tenably permitted to be incorporated in the written-statement. This court does not find any error in the reasonings formed by the learned court below in permitting the defendants concerned to carry out amendments in the written-statement previously instituted. Consequently, there is no merit in the petition, same is accordingly dismissed.
8th April, 2015 (priti)
( Sureshwar Thakur ), Judge.
3 issues framed by the court
Whether the amendment to the written statement altering the nature of the defendant from a trust to a partnership firm grossly alters its structure and character and is therefore impermissible.
Whether the proposed amendments are of a clarificatory nature intended to erase ambiguities regarding the capacities of the defendants.
Whether the pre-issue stage of the suit permits amendments to facilitate the framing of appropriate issues and rendition of a decree.
Sunil Kumar Bansal & another
K.T.S Educational and Charitable Trust
Sureshwar Thakur
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
