Dismissed

Ranjana Sharma v. Kccb and Others

Himachal Pradesh HC7 Nov 2024FAO(OS)/22/2024

Case brief

AI extract

What is this about?

The High Court dismissed the appeal against orders rejecting applications to implead a third party (an agent/power of attorney holder) in a suit for recovery filed against the principal borrower. The court held no privity of contract existed with the agent and affirmed the lower court's view.

What did the court decide?

Appeal dismissed; findings of the learned Single Judge in OMP No. 214 of 2023 and OMP No. 143 of 2024 affirmed.

Ranjana Sharma Vs Kccb and Others — Contract and Commercial Disputes | Himachal Pradesh HC (2024)

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( 2024:HHC:11046 )

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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.

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FAO(OS) No. 22 of 2024 Decided on: 7^th November, 2024 Ranjana Sharma .......Appellant Versus Kangra Central Cooperative Bank Amb and ors. ...Respondents

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Coram

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The Hon’ble Mr. Justice Tarlok Singh Chauhan, Acting Chief Justice

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The Hon’ble Mr. Justice Satyen Vaidya, Judge.

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Whether approved for reporting?¹ No.

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For the appellant: Mr. Neel Kamal Sood, Senior Advocate with Ms.Seema Azad, Advocate. For the respondents: Mr. Umesh Kanwar, Advocate for respondent No.1.

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Tarlok Singh Chauhan, ACJ (Oral)

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Appellant/defendant No.1 aggrieved by the order

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passed by the learned Single Judge dated 28.06.2024, whereby his application for impleading one M/s Jhajj, express ways through its proprietor and another application moved by her for placing on record certain documents also came to be dismissed.

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The facts are not in dispute. Appellant/defendant

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No.1 filed an application being OMP No. 214 of 2023 for

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1 Whether the reporters of Local Papers may be allowed to see the judgment? Yes.

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( 2024:HHC:11046 )

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impleading the M/s Jhajj, express ways through its proprietor as a party.

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It was averred that plaintiff/respondent No.1 had filed a suit for recovery which was pending adjudication before this Court. The loan was disbursed to defendant No.1, whereas, proposed defendant No.4 had entered in an agreement which had been submitted to the plaintiff. Possession of three buses, in fact, had been handed over to proposed defendant No.4 and the same were in its custody and were being regularly plied.

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It was further averred that it had been agreed between the parties that it would be the proposed defendant No.4 who would be regularly paying the installment to the bank, but had failed to do so. Since proposed defendant No.4 had not returned the buses to them and the bank had not taken any action to take possession of the buses, therefore, it had become necessary to implead proposed defendant No.4 who was not only a necessary, but a proper party.

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The application was opposed by the bank on the ground that there was no privity of contract between the plaintiff and defendant No.4 and rather the application was malafide and had been filed in collusion by defendant No.1 with defendant No.4. It was defendant No.1 who had signed

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( 2024:HHC:11046 )

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all the documents at the time of availing the loan and defendants No.2 and 3 had stood guarantors. The violation of any agreement between defendant No.1 and defendant No.4 would not make him a necessary or a proper party.

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Heard. It is not in dispute that there is no privity of contract between the plaintiff and defendant No.4. Defendant No.4, in fact, is the power of attorney holder of defendant No.1 that means that he, at best, is the agent of defendant No.1, but then, he is neither a necessary nor a proper party, in view of Section 230 of Indian Contract Act which specifically provides that an agent cannot enforce the contracts entered into by him on behalf of the principal nor is he personally bound by them. Since the agent acts on behalf of the principal; only the principal is liable and the agent cannot be made liable.

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As observed above, the plaintiff had advanced loan to defendant No.1 and defendants No. 2 and 3 had stood guarantors as per plaintiff. It is defendant No.1 who has failed to deposit the loan amount and that is why the plaintiff had filed the suit for recovery.

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The learned Single Judge had rightly observed that a stranger to the contract cannot be sued, therefore,

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( 2024:HHC:11046 )

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proposed defendant No.4 being a stranger cannot be made a party to the suit.

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Moreover, it is the settled law that the plaintiff is the ‘ dominus litis ’ and he/she is not bound to sue every possible adverse claim in the same suit and he/she may choose to implead only those persons against whom he wishes to proceed and the defendant cannot dictate terms to the plaintiff to implead a certain party. It is for the Court to see whether a person is necessary or a proper party or whether the plaintiff has unnecessarily joined any party as defendant, who may not be necessary or proper party at all only on the ground that the plaintiff is the ‘ dominus litis ’.

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Having said so, we find no fault with the findings recorded by the learned Single Judge in OMP No. 214 of 2023. Accordingly, the same are affirmed.

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As regards findings in OMP No. 143 of 2024, this application had been dismissed by the learned Single Judge as it was on the basis of the documents appended with this application that defendant No.1 has sought to implead defendant No.4. Once, defendant No.4 is not a necessary party, then, no fault can be found with the findings recorded by the learned Single Judge to the effect that these

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( 2024:HHC:11046 )

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documents are not relevant for the adjudication of the dispute.

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Therefore, we find no fault with the findings recorded by the learned Single Judge in OMP No. 143 of 2024. Accordingly, the same are affirmed.

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In view of the discussion made hereinabove, we find no merit in the instant appeal and the same is accordingly dismissed, so also the pending applications, if any.

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( Tarlok Singh Chauhan ) Acting Chief Justice

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November 07, 2024 ( Satyen Vaidya ) (naveen) Judge

Ranjana Sharma v. Kccb and Others

Case brief

What is this about?

What did the court decide?

Ranjana Sharma v. Kccb and Others

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

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