Ravinder Kumar Bansal And Others vs Pankaj Gupta And Others

Sandeep Sharma, J.

By way of instant application filed under Order 1 Rule 10 read with Section 151 of the Code of Civil Procedure, prayer has been made on behalf of

the applicants-plaintiffs for adding Shri Birbhan Goel as proforma defendant No. 4. Prayer made in the application referred to herein above is opposed

by the non-applicants/defendants by way of a detailed reply filed to the application. Applicants-plaintiffs have filed above captioned civil suit for

recovery of an amount of Rs. 4,74,32,000/- as balance consideration in terms of agreement dated 21.3.2013. As per agreement dated 21.3.2013,

applicants-plaintiffs agreed to transfer their complete equity share of Atul Castings Limited (ACL) having its registered office at Village Dandi Kania,

Tehsil Nalagarh, District Solan, Himachal Pradesh in favour of the defendants for a total sale consideration of Rs. 8,51,00,000/-. Since non-

applicants/defendants allegedly failed to make complete payment in terms of agreement referred to herein above, suit bearing No. 25 of 2016 titled

Ravinder Kumar Bansal and others vs. Pankaj Gupta and others came to be filed for recovery of amount, as has been taken note herein above.

Ms. Ambika Kotwal, learned counsel representing the applicants/ plaintiffs contended that while going through the pleadings and documents at the

time of framing of issues, it transpired to the counsel for the applicants/plaintiffs that as per Clause 2 (c) of the agreement dated 21.3.2013, one Shri

Birbhan Goel is also a beneficiary of the said agreement but inadvertently, that too under bonafide inference of law and facts, he could not be arrayed

as a defendant in the suit for recovery on the basis of agreement dated 21.3.2013 and as such he may be ordered to be impleaded as proforma

defendant. While inviting attention of this Court to agreement dated 21.3.2013, Ms. Ambika Kotwal, made a serious attempt to persuade this Court to

agree with her contention that since Birbhan Goel is beneficiary of the agreement dated 21.3.2013, he being a necessary party for proper and

complete adjudication of the matter, deserves to be arrayed as a proforma defendant. In support of aforesaid contention, Ms. Ambika Kotwal, placed

reliance upon following judgments to persuade this Court to agree with her contention that it is not necessary that relief should be claimed against a

person proposed to be added as party respondent or plaintiff because his/her presence may be otherwise essential for proper adjudication of the case:

(i) Savitri Devi v. District Judge, Gorakpur, AIR 1999 SC 976

(ii) Vidur Impex and Traders Pvt. Ltd. v. Tosh Apartments Pvt. Ltd., AIR 2012 SC 2925

(iii) Chet Ram V/s Brij Lal, Latest HLJ 2015 (HP) Suppl. 616

While placing reliance upon the aforesaid judgment, Ms. Kotwal, further argued that the plaintiffs being the dominus litus are otherwise entitled to

array anybody as a party because exclusion, if any of the proposed defendant at this stage, would ultimately lead to multiplicity of proceedings, which

is against the very object of the provisions contained in Order 1 Rule 10 (2) CPC.

Mr. Ramakant Sharma, learned Senior Advocate duly assisted by Mr. Basant Thakur, Advocate, while opposing/refuting aforesaid prayer made on

behalf of the applicants-plaintiffs and submissions made by the learned counsel representing the applicants/plaintiffs, vehemently argued that neither

Shri Birbhan Goel is a necessary nor a proper party for the adjudication of the lis at hand as such, application deserves to be dismissed. Mr. Ramakant

Sharma, learned Senior Advocate, while inviting attention of this court to para-5 of the application filed on behalf of the applicants-plaintiffs contended

that since it is an admitted case of the parties that no relief has been claimed against the proposed proforma defendant, as such, prayer made in the

instant application deserves to be rejected being devoid of any merit. Apart from above, Mr. Sharma, learned Senior Advocate, while referring to the

written statement having been filed on behalf of the non-applicants/defendants, argued that a sum of Rs. 28,83,597/- is due and payable to the

defendants by the applicants/plaintiffs and as such, there is no force in the arguments of the learned counsel representing the applicants/plaintiffs that

non-applicants/defendants have failed to pay balance sale consideration in terms of agreement dated 21.3.2013.

Having heard the learned counsel representing the parties and gone through the record, one thing is quite apparent that in terms of the agreement

dated 21.3.2013, validity and legality whereof is otherwise subject matter of the civil suit pending before this Court, applicants/ plaintiffs have agreed to

transfer their complete equity share of Atul Castings Limited in favour of the defendants, for a total sale consideration of Rs. 8,51,00,000/-. Similarly, it

emerges from the pleadings adduced on record by the plaintiff that as of today, an amount of Rs. 4,74,32,000/- is payable by non-

applicants/defendants towards alleged balance consideration. As has been noticed herein above, controversy with regard to complete payment in

terms of agreement dated 21.3.2103 is pending adjudication before this Court in the main suit. No doubt, perusal of clause 2 (c) of agreement dated

21.3.2013 suggests that as per agreed terms inter se parties, an amount of Rs. 225.00 Lakh is payable to Shri Birbhan Goel by the non-

applicants/defendants. It would be profitable to take note of the aforesaid clause as stands mentioned in the agreement dated 21.3.2013, as under:

“Rs.225.00 Lakh payable to Shri Birbhan Goel by the first party shall now be paid by second party. If payment is not made by 5.4.2013, then

interest @ 1.5% per month will also be paid. Two post dated cheques for the same have already been issued to Shri Birbhan Goel.â€​

It is evident from a bare reading of aforesaid Clause contained in agreement dated 21.3.2013 that defendants being second party to the agreement

are/were under obligation to pay an amount of Rs. 225.00 Lakh to Mr. Birbhan Goel before 5.4.2013, whereafter interest at the rate of 1.5% per

month is/was payable. Noticeably, Clause referred to herein above clearly suggests that at the time of entering into agreement two post-dated cheques

qua amount referred to herein above were issued to Shri Birbhan Goel. Interestingly, neither in the plaint nor in the application at hand, there is

averment, if any, that amount as mentioned in the aforesaid clause has not been paid to Shri Birbhan Goel by the defendants, rather, application in this

regard is conspicuously silent. Further, in para-6 of the plaint, it has been mentioned that person namely Birbhan Goel is persistently demanding amount

in terms of agreement dated 21.3.2013 from the applicants-plaintiffs, but, interestingly, no documents/notice(s), if any, received in this regard have

been placed on record. Even during the pendency of this application, matter was repeatedly adjourned to enable learned counsel representing the

plaintiffs to place on record letter or notice, if any, issued by Shri Birbhan Goel, claiming aforesaid amount from the applicants/plaintiffs.

Otherwise also, once it is not in dispute that as per agreement, this amount is/was to be paid by the defendants, where is/ was occasion for Shri

Birbhan Goel to approach applicants/ plaintiffs for the payment of amount as stated in aforesaid clause. Leaving everything aside, as has been noticed

herein above, two post-dated cheques already stand issued in favour of Shri Birbhan Goel, qua the amount mentioned in the aforesaid clause and as

such, Shri Birbhan Goel could always present these cheques in the bank concerned after expiry of the date i.e. 5.4.2013 as mentioned in the

agreement. In the event of dishonouring of cheques, he could always initiate proceedings under Section 138 of the Negotiable Instruments Act against

the non-applicants/defendants, who had issued cheques in favour of Shri Birbhan Goel. Though, applicants/ plaintiffs in para Nos. 6 and 7 of the plaint,

have stated that cheques issued in favour of Shri Birbhan Goel in terms of agreement dated 21.3.2013, were actually snatched and destroyed by the

non-applicants/defendants and in this regard, FIR was also lodged with the police but non-applicants/defendants in their written statement have

disputed aforesaid fact and have categorically stated that in lieu of amount of cheques in question, material to M/s Shri Kangra Steel Limited has been

supplied. Otherwise also, these allegations/counter allegations can not be seen at the stage of deciding the application but shall be decided in the main

suit, on the basis of evidence led on record by the respective parties.

It is not in dispute that no relief, whatsoever has been claimed against Shri Birbhan Goel, who is proposed to be added as a party rather,

applicants/plaintiffs in para-5 have admitted themselves that no relief is claimed against Birbhan Goel, and at the same time, no cogent and convincing

reasons have been placed on record to substantiate their argument that impleadment of Shri Birbhan Goel is necessary as well as proper for

adjudication of the case at hand.

True it is that as per agreement dated 21.3.2013, Shri Birbhan Goel is to receive some amount but, as has been noticed herein above, that amount is

payable by non-applicants/ defendants and in this regard, action, if any, is/was to be taken by Shri Birbhan Goel against the non-applicants/defendants,

if permissible under law, for recovery of such amount. Definitely, applicants/ plaintiffs can not hold brief for Shri Birbhan Goel, who has chosen not to

approach this Court, seeking his impleadment. Similarly, Ms. Kotwal was unable to show from the record that Shri Birbhan Goel, who is proposed to

be impleaded as defendant has initiated any proceedings for recovery of amount in terms of agreement, in any court of law.

There can not be any quarrel with the proposition of law laid down by the Hon'ble Apex Court, as has been relied upon by Ms. Kotwal, that it is

not necessary that any relief is sought against a party, who is proposed to be impleaded, but to prove that the person proposed to be impleaded as

party is a necessary or property party, applicants are required to prove /show that such a person has a direct interest in the case as held by Hon'ble

Apex Court in Razia Begum vs Sahebzadi Anwar Begum & Others, AIR 1958 SC 886 , wherein it has been held as under:

“13. As a result of these considerations, we have arrived at the following conclusions:-

(1) That the question of addition of parties under R. 10 of O I of the Code of Civil Procedure, is generally not one of initial jurisdiction of the court, but

of a judicial discretion which has to be exercised in view. of all the facts and circumstances of a particular case; but in some cases, it may raise

controversies as to the power of the court, in contra distinction to its inherent jurisdiction, or, in other words, of jurisdiction in the limited sense in which

it is used in s. 115 of the Code;

(2)That in a suit relating to property in order that a person may be added as a party, he should have a direct interest as distinguished from a

commercial interest in the subject matter of the litigation;

(3)Where the subject-matter of a litigation is a declaration as regards status or a legal character, the rule of present or direct interest may be relaxed

in a suitable case where the court is of the opinion that by adding that party it would be in a better position effectually and completely to adjudicate

upon the controversy ;

(4) The cases contemplated in the last proposition have to be determined in accordance with the statutory provisions of ss. 42 and 43 of the Specific

Relief Act ;

(5) In cases covered by those statutory provisions the court is not bound to grant the declaration prayed for, on a mere admission of the claim by the

defendant, if the court has reasons to insist upon a clear proof apart from the admission;

(6)The result of a declaratory decree on the question of status such as in controversy in the instant case affects not only the parties actually before the

court but generations to come, and, in view of that consideration, the rule of I present interest' as evolved by case law relating to disputes about

property does not apply with full force; and (7)The rule laid down in s. 43 of the Specific Relief Act is not exactly a rule of res judicata. It is narrower

in one sense and wider in another.â€​

Further, this Court in State Bank of India v. Krishana Pottery Udyog Association, 1994(2) Sim. L.C. 197 has held as under:

“8. In the instant suit, privity of contract is in between the parties to the suit in question. In fact, the Board is not in any way concerned with the

terms and conditions relating to the advancement of the loan or repayment thereof. Further, the Board had agreed to extend interest subsidy benefit to

the loanee in case the latter owned a small scale industrial unit and this benefit had been given under a statutory scheme applicable in the case of such

loanees. It is well settled that in order a party may be added as a defendant in the suit, he should have a legal interest in the subject-matter of the

litigation- legal interest not as distinguished from an equitable interest, but an interest which the law recognizes. A person who would be only indirectly

or commercially affected by the result of the litigation, cannot be impleaded as a party as a person having a direct interest in the subject-matter in

dispute. The expression “all the questions involved in suit†cannot be read as “questions involved between the parties to the suitâ€. [See

Bindeshwari Chaudhary’s case (supra)]. In the instant case, the Board, as observed, had simply bound itself to the payment of interest on the loan

advanced to the defendants and that too till the time, their industrial unit/Association continued to remain in production. What was the amount of loan

advanced or how it was to be repaid, were not the contractual terms entered into in between the parties to the suit in question and the Board. Thus, in

that view of the matter, the Board having no legal interest, cannot be directed to be arrayed as a defendant in the present suit. Further, the plaintiff-

bank has not sought any relief against the Board. This fact also cements the conclusion arrived at on this aspect of the case. Accordingly, issue No.1

is decided against the defendants and in favour of the plaintiff â€​

Similarly, though this Court is in agreement with Ms. Kotwal, that very object and purpose of provisions contained in Order 1 Rule 10 (2) CPC is

to avoid multiplicity of proceedings, but, in the case at hand, though there is mention of Shri Birbhan Goel in agreement dated 21.3.2013, but as per

agreement, there appears to be no liability, if any, of applicants/ plaintiffs to pay the amount to Shri Birbhan Goel, rather, amount if any, is to be paid by

the non-applicants/defendants and in this regard, proceedings, if any, are /were to be initiated by Shri Birbhan Goel against the non-

applicants/defendants.

Otherwise also, at the cost of repetition, it may be observed that there is no material adduced on record by applicants/plaintiffs to demonstrate that

the person namely Shri Birbhan Goel is pressing hard for money in terms of agreement, from the applicants/ plaintiffs.

Consequently, in view of detailed discussion made herein above, this Court is convinced and satisfied that impleadment of Shri Birbhan Goel as

proforma defendant is not necessary or proper in the instant proceedings, for proper adjudication of the case. Accordingly, the application is dismissed

being devoid of merits.