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Judgment
Biswaroop Chowdhury, J.: This application is filed by the defendant no-1 and 2 praying for the following reliefs:-
a)Plaint filed in C.S. No. 280 of 2012 as against the defendant no. 1 to 34 be rejected;
b)C.S. No. 280 of 2012 be dismissed as against the defendant Nos. 3 to 34.
c)Alternatively the names of defendant Nos. 3 to 34 be deleted from the array of parties and all pleadings and prayers concerning and/or affecting these defendants be expunged under Order VI Rule 16 of the Code of Civil Procedure.
d)Stay of all further proceedings in C.S. No. 280 of 2012 pending disposal of the present application.
e)Alternatively leave be granted to the applicants to file written statement and delay in filing the same be condoned.
f)Ad-interim orders in terms of prayers above;
g)Such further or other order or orders be passed and/or directions be given as this Hon’ble Court may deem fit and proper.
The case of the applicants may be summed up thus;
The present suit has been filed not only against the applicant Nos. 1 and 2 but also against the applicants/defendants Nos-3 to 34 which have been alleged to be the A.K. Group of companies pursuant to leave granted by Order dated 27th April 2017.
Pursuant to the leave granted by the aforesaid order dated 27th April 2017 the plaintiff amended the instant suit by claiming the following reliefs:-
a)A decree declaring that all the properties and assets including the defendant Nos. 3 to 34 and those mentioned in the schedule being annexure ‘E’ are the properties and assets belonging to the plaintiff’s husband;
aa) Decree for partition of the assets and property mentioned in the schedule being Annexure ‘E’ hereof among the plaintiff and the defendant nos. 35 to 37 in accordance with the shares of the said parties as stated in paragraph 48 hereof by metes and bounds or otherwise as the Hon’ble Court may deem fit and proper;
ab) Decree for declaration that the equity shares particulars whereof have been given in schedule ‘A2’ hereof are properties and assets belonging to the plaintiff’s husband:
ac) Decree for partition of the said shares mentioned in schedule ‘A2’ hereof amongst the plaintiff and the defendant nos. 35 to 37 in accordance with the shares of the said parties as stated in paragraph 48 hereof:
b)A decree for enquiry into the properties and assets of the business of the plaintiff’s husband;
ba) Decree for partition of all properties assets and business as may be found due upon such enquiry amongst the plaintiff and the defendant nos. 35 to 37 in accordance with shares of the said parties as stated in paragraph 48 hereof.
c)A decree directing the defendant Nos. 1 and 2 to disclose true and faithful accounts of all the businesses and incomes derived therefrom;
d)A decree for such sum in favour of the plaintiff as may be found due and payble on such accounts being furnished by the defendants Nos. 1 and 2;
e)Perpetual injunction restraining the defendants from dealing with and/or dealing and/or disposing and/or transferring and/or acting in whatsoever nature with regard to the assets and properties and the share and/or books of accounts and documents of whatsoever in nature of the companies and the firms and/or properties and Assets as stated in schedule being Annexure ‘E’ hereof.
f)Perpetual injunction restraining the defendant No. 1 and 2 and/or his associates from holding any meeting and/or giving any effect and/or further effect to the purported Board Meetings of the said Companies as mentioned in the schedule being Annexure ‘E’ herein and/or the Minutes so recorded in the Board Meeting;
g)Declaration that the documents and/or the minutes relating to any Board Meeting conveyed after 8th October 2011 be delivered up and cancelled upon the same being adjudged null and void.
h)Receiver.
i)Injunction.
j)Attachment.
k)Costs.
l)Such further relief or other relief’
From the averments made in the plaint and the documents disclosed therewith, it appears that plaintiff is neither a director nor a shareholder of the defendant Nos. 3 to 34. The plaintiff at best is entitled to 1/4th of the shareholding of Late Arun Kumar Bhutoria. The other three co-sharers having 1/4th share in the estate of Arun Bhutoria and the defendant Nos. 35 to 37 who are the mother and two sons of Late Arun Kumar Bhutoria.
The plaint also does not disclose any cause of action against either the petitioners herein or the defendant Nos. 3 to 34. The plaint case against the petitioners and the defendant No. 3 to 34 is also barred by law, especially the Benami Transaction (Prohibition) Act 1988 and the Companies Act 2013.
The defendant no-1 and 2 are directors of several of the companies i.e. defendant Nos. 3 to 34. The defendant Nos. 1 and 2 and their immediate family members are also shareholders of several of those companies. The said defendants are vitally interested in the management and affairs of the defendant Nos. 3 to 34. However the defendants Nos. 3 to 34 have several other directors as well as shareholders particulars whereof are in public domain as in the records of the Ministry of Corporate Affairs which can be accessed by any person so interested. There were several other share holders of the defendant Nos. 3 to 34 at the time of filing of the suit would be evident inter alia from Annexure ‘A2’ to the plaint. These defendants however do not admit the correctness of Annexure A2 to the plaint.
Going by the admitted plaint case that Late Arun Kumar Bhutoria had passed away leaving behind the plaintiff and the defendant Nos. 35 to 37 as his heirs intestacy, in the partition suit, name of the other defendants can be impleaded. Late Arun Kumar Bhutoria did not and could not have any right or title or interest in any of the assets and properties or businesses of the defendant Nos. 3 to 34. Late Arun Kumar Bhutoria was a shareholder in such companies. His shareholding is disputed as more fully stated in Annexure ‘A2’ to the plaint.
For partition of the shares of Late Arun Kumar Bhutoria more fully stated in Annexure ‘A-2’ to the plaint neither the defendant Nos. 3 to 34. Companies nor the defendant Nos. 1 and 2 are necessary or proper parties. So far as reliefs claimed in the suit pertaining to the assets and properties of the defendant no. 3 to 34 and the businesses and officers of the said defendants as in prayers (a), (aa), (c), (d), (e) to the extent it is against the defendant Nos. 1 to 34) (f) and (g) are concerned, the plaint does not disclose a cause of action. The defendant Nos. 3 to 34 are all independent limited companies controlled by their respective board of directors and are juristic entitles. Even otherwise this Hon’ble Courts jurisdiction to entertain any suit or consider any relief in respect of these claims as are barred by Section 430 of the Companies Act 2013.
In the circumstances the present applicants i.e. defendant Nos. 1 to 34 being neither necessary nor proper parties should be deleted from the array of defendants. Further, the defendant Nos. 7, 8, 15, 18, 20, 23, 29 and 33 have been presently struck off from the register of companies and the same stand dissolved.
The suit filed against these defendants and/or concerning these defendants should be dismissed being barred by law and also the plaint discloses no cause of action so far as the case as made out and reliefs claimed against these defendants.
In view of Section 430 of the companies Act 2013 being notified the present suit can no longer be entertained by this Hon’ble Court.
The present suit is also frivolous and vexatious and has been filed in abuse of process of law.
In any event the plaintiff does not and cannot have any right, title or interest in any of the assets or properties of the defendant no. 3 to 34.
No cause of action is disclosed in the plaint against the defendant Nos. 1 and 2.
If at all the plaint filed in the present suit is held to be maintainable leave may be granted to the defendant Nos. 1 and 2 to file their written statement and delay in filing the written statement be condonded.
The said application was contested by the plaintiff by filing Affidavit in opposition to the Affidavit filed by Defendant No-1, on behalf of Defendant no-3, as well as Affidavit in opposition to the Affidavit filed by Defendant No-2 on behalf of himself and defendant no. 4, 5, 6, 10, 13, 24, 28, 30, 31, and 34. in GA NO-11 of 2025. In the affidavit in opposition to the affidavit of defendant no-1 the plaintiff has contended that the Defendant no-1 has filed this affidavit not only in his personal capacity but also on behalf of a company being Defendant No. 3.
It is further contended as follows:-
The instant suit being C.S. No. 280 of 2012 was originally filed against the Defendant Nos. 1 and 2 inter alia praying for a declaration that all properties and assets belonging to Defendant Nos. 3 to 34 are the assets and properties of the plaintiff’s husband. A decree was also sought directing Defendant Nos. 1 and 2 to faithfully disclose accounts of all businesses and income derived therefrom.
ii)The suit pertains to the partition of family properties and assets held for the benefit of family members.
iii) The suit pertains to the partition of family properties and assets held for the benefit of family members, where the consideration for such properties originated from the funds of the Karta namely deceased husband of the plaintiff Arun Kumar Bhutoria.
iv) Pursuant to an Order of this Hon’ble Court dated April 27, 2017 plaintiff was permitted to convert the suit into a partition suit. This conversion followed an Order of the Hon’ble Division Bench dated April 28, 2014, which recorded that the pendency of the appeal would not preclude plaintiff from filing suit for partition or seeking appropriate relief therein.
Following the said order, the plaint was amended to include additional reliefs for partition of assets and properties mentioned in the plaint among plaintiff and Defendant Nos. 35 to 37. No appeal was filed by the Defendants.
vi) Despite the order dated 27-04-2017 and the suit being pending for over a decade Defendant Nos. 1 and 2 and the corporate defendants, (including Defendant No. 3) have till date failed to file any Written Statement.
vii) After a lapse of 13 years the Defendants 1 and 2 have filed an application under Order 7 Rule 11 of the Code of Civil Procedure for dismissal of the suit. This is clear attempt to frustrate the judicial process and delay the partition of assets.
viii) The Defendant No-1 in collusion with Defendant No. 2 and their associates, is actively eroding the business of the Companies (Defendant Nos. 3 to 34). Despite repeated requests they have failed to produce documents or render true and faithful accounts and have brought about material changes in the said Defendant companies to the detriment of the plaintiff. Several companies within the AK Group have been struck off, further jeopardizing the interest of the plaintiff.
ix) Sudden appearance of Counsel for various corporate defendants including Defendant No. 3 (AK Computech Pvt. Ltd.) at this late stage of the current application is a tactical plot designed solely to delay the proceedings and to further erode the assets of the Defendant companies after having wrongfully taken complete control of the same taking advantage of the sudden demise of the plaintiff’s husband.
Counsel appearing for the Defendant No-3 initially appeared without proper authorization. When this was challenged in Court, they sought leave to Produce ‘de facto’ authorizations.
xi) The Bar under Section 430 of the Companies Act 2013 does not apply as this is a Civil Suit for partition of family assets, which cannot be adjudicated by the NCLT.
xii) The prohibition of Benami Property Transactions Act 1988, is also inapplicable as the properties were created and held for the benefit of family members from the karta’s funds.
Now with regard to the affidavit filed by Defendant no-2 it is contended by the plaintiff in her affidavit in opposition that the defendant no-2 has filed this affidavit not only in his personal capacity but also on behalf of a large group of companies being Defendant Nos. 4, 5, 6, 10, 13, 24, 28, 30, 31 and 34. The other contentions are same as taken with regard to Affidavit filed by Defendant no-1. The Defendant no-1, and Defendant no-2 also filed affidavit as Director of Defendant no-3 Company and Defendant no-4 Company.
The main contention of the said defendants are that the allegation of oppression and mismanagement raised against defendants No-3, 4 and other corporate entities being party defendant in the suit is not maintainable in view of Section 430 of the Companies Act 2013.
The Defendant no-36 has filed Affidavit and supported the plaintiff’s case to continue with the suit. It is contended that the Defendant no-1 has forged and fabricated the minutes dated March 20 2024, to mislead this Court.
As this application is filed by the Defendant no-1 and 2 praying for dismissal of the suit under Order 7 Rule 11 of the Code of Civil Procedure it is necessary to confine to the averments made in the plaint and consider the submissions on the points of law and decide the issue without further going into the dispute of facts.
Learned Advocate for the Defendant no-1 and 2 submits that the present suit after amendment is a partition suit has also been held in the Order dated 21st July 2014.
Learned Advocate further submits that the suit is bad for mis-joinder and non-joinder of parties under Order 1 Rule 10(2) of the Code of Civil Procedure.
The plaintiffs in a partition should plead as defendants:-
the heads of all branches.
ii) the females who are entitled to a share on partition.
iii) the purchaser of a portion of the plaintiff’s share the plaintiff himself being a co-percener.
iv) if the plaintiff himself is a purchaser from a co-percener his alienor.
The above are necessary parties and if any of them is not joined, the suit is liable to be dismissed. The entire joint family must be represented either expressly or im-plicitly. Reference may be made to S.6. of the Hindu Succession Act 1956, and particularly to the proviso to that section.
It is desirable that the following persons should be made parties, though not necessary parties they are proper parties to such suit.
A mortgagee with possession of the family property or of the undivided interest of a coparcener;
ii) Simple mortgagees of items of the family property;
iii) Purchaser of the undivided interest of a co-parcener.
iv) Persons entitled to provision for their maintenance and marriage i.e. widows, daughters sister and such like and distinguished heirs;
Any person entitled to maintenance from the family.
The plaintiff may also implead any other coparcener or any person interested in the family such as a mortgagee or a lessee. Such a person may himself apply and be made a party.’
Learned Advocate also submits that it is not the plaint case that any of the defendant Nos. 1 to 34 are the heirs in intestacy of or have any share in the estate of Late Arun Kumar Bhutoria. Thus they are neither necessary nor proper parties. The present application is under Order 1 Rule 10(2) read with Order 7 Rule 11 of the Code of Civil Procedure for striking off the names of the defendants Nos. 1 to 34 and dismissing the suit against these defendants.
It is submitted by Learned Advocate that defendant nos. 1 and 2 have been impleaded as ostensible owners of shares in the defendant nos. 3 to 34. Therefore if the defendant Nos. 1 and 2 are necessary or proper parties by virtue of them being shareholders of the defendant Nos. 3 to 34, then in that case other shareholders of the defendant no- 3 to 34, more fully stated in the plaint itself in Annexure ‘A2’ against whom reliefs have also been claimed non-impleadment of these other share-holders result in non-joinder of necessary parties. The suit is thus barred other way i.e. for non-joinder of necessary party. It is further submitted that the suit as framed cannot be proceeded with. Thus by virtue of Order 1 Rule 10(2) of the Code of Civil Procedure the names of the defendant Nos. 1 to 34 are liable to be struck off.
Learned Advocate relies upon the following Judicial decisions:-
Laxmi Niwas VS Lindroy International Private Limited and ors. Reported in 2018(2) CHN 42.
The Church of Christ Charitable Trust and Educational Charitable Society VS M/S Ponniamnan Educational Trust. Reported in (2012) 8 SCC P-706.
Sheela Ram Vidhani VS S.K. Trading Company. Reported at 2021 SCC. Online Bom 864. (DV).
Bacha F. Gurdar. VS Commissioner of Income Tax Bombay Reported in (1954) 2 SCC P-563.
Ramesh Kumar Bhagchandika VS Mahash Kumar Bhaqchandika and ors. Reported at 2014 SCC. Online Del 1324.
Amratlal Bhanji Laxman VS Kusum Probhudas Laxman and ors. 2009 SCC Online Bom-776.
K.S. Mothilal VS K.S. Kasimaris Teramique (P) Ltd. Reported at (2003) 113 Comp, Cas 562.
Narendra Kumar Berlia VS Om Prakash Berlia and others. Reported in 2011(3) CHN-147.
Hindusthan Commercial Bank Ltd. VS Punnu Sahu. 1971 (3) SCC-124.
Shashi Prakash Khemka VS NEPC Meion Ltd. Ors. Reported at (2019) 212 Comp. Cases 385(SC).
Bhaskar Gupta VS Calcutta Club Limited and ors. MANU/WB/1435/2022.
Suraj Prakash Arora and ors. VS Roshanara Club Limited and ors. Manu/DE/2685/2025.
Inacio Martins VS Narayan Hari Naik and ors. (1993) 3 SCC. 123.
Learned Advocate for Defendant no-3 submits that the assets of the Defendant No-3 cannot be a subject matter of a partition suit and an attempt towards such a relief would clearly fall within the ingredients of Order VII Rule 11 of CPC and on a bare perusal of the statements made in the plaint, the suit would clearly appear to be one barred by Section 430 of the Companies Act 2013.
Learned Advocate further submits that the clear bar put by Section 430 of the Act of 2013 by the legislature is aimed to impede any civil court from entertaining an action which is maintainable only before NCLT or the NCLAT as the case may be.
Learned Advocate also submits that a perusal of the plaint as amended would reveal that the properties of the companies were sought to be dealt with and partitioned and the plaintiff if at all would be required to initiate appropriate proceedings before the NCLT and if such step is taken in future by the plaintiff the answering defendant reserves its rights to defend the same appropriately.
The following decisions are relied by the Learned Advocate.
Narendra Kumar Berlia and ors VS Om Prakash Bertia and ors. Reported in 2011 SCC Online Cal-923.
Pesticide and Brewaries Ltd. VS Narendra Kumar Berlia. 2011 SCC Online Cal-1570.
Bacha F. Gurdar VS Commissioner of Income Tax. Reported in 1954 (2) SCC.563.
Amrat Lal Bhanji Laxman VS Kusum Probhudas Laxman and ors. Suit No.-3461 of 2009.
Mr. Vijay Nahar. VS Mr. Anil Nahar and Anr. C.S. No-86 of 2004.
It is submitted that the petition filed by Defendant Nos. 1 and 2 being supported by the Defendant No. 3 that the plaint be rejected for the aforesaid reasoning.
Learned Advocate for the Defendant no. 4,5,6,10,13,24,28,30,31, and 34 submits that the plaintiff has filed the instant suit for partition of the assets and properties mentioned in Annexure ‘E’ to the plaint in accordance with the shares of the parties as mentioned in paragraph 48 of the plaint as well as for declaration and injunction.
Learned Advocate further submits that the plaintiff is neither a shareholder nor a director of the defendant companies being defendant Nos. 4,5,6,13,24,28,30,31 and 34. The plaintiff has sought for partition of the shares of the said defendants, the share holdings and the Board of Directors of the said defendants.
Learned Advocate also submits that from perusal of Annexure A2 to the plaint it is evident that the plaintiff namely Suchandra Bhutoria, is neither a director nor a shareholder of the said defendants. As such relief if any with respect to the shares held by the said defendants in the name of late Arun Kumar Bhutoria could only be obtained by filing an application under Section 58 and 59 of the companies Act 2013 before the National Company Law Tribunal. Thus there is specific remedy available under the Companies Act 2013 under Provisions namely Section 58 and 59, for the plaintiff for seeking transmission of shares of Late Arun Kumar Bhutoria.
It is submitted by Learned Advocate that in company jurisprudence there cannot be partition of the company. Either majority shareholders of the company buy out the shares of minority share holders of the company or vice-versa. The second scenario is winding up of the Company and thereafter the assets and liabilities of the company being divided amongst the share holders of the company.
It is further submitted that in the instant case, the companies being the said defendants hold several assets described in Annexure ‘E’ to the plaint. A company being a separate independent juristic entity the assets of these companies cannot be partitioned without going through the rigours of the provisions of the Companies Act 2013 which enable the majority share holders to buy out the shares of the minority shareholders or vice-versa or for winding up of the company.
Learned Advocate also submits that there cannot be a partition of the assets held by a company.
The following decisions are relied upon.
Shashi Prakash Khemka VS NEPC MICON Reported in (2019) 18 SCC-569.
Bacha F. Gurdar VS Commissioner of Income Tax Bombay. Reported in (1954) 2 SCC. P 563.
Shyamlal Purohit and anr. VS Jagannath Roy and Anr. (1970) 40 Comp. cases 138.
T. Arivandandam. VS T.V. Satyapal and Anr. (1977) 4 SCC. 467.
Learned Advocate for the Plaintiff submits that the instant suit was filed by the plaintiff in the year 2012. The said suit was initially a suit for declaration and perpetual injunction. However when an appeal was preferred by the plaintiff against an interlocutory order, the Division Bench of this Hon’ble Court by an order dated 28th April 2014, inter alia held that the pendency of the appeal could not preclude the appellant from filing a suit for partition as well as praying for appropriate reliefs in the suit. Thereafter the plaintiff filed an application seeking amendment of the plaint before the interlocutory Court and by an order dated 27th April 2017, it was observed that the plaintiff can make necessary and suitable amendment to the existing pleading in order to convert the suit to a partition suit when a reading of the plaint pre-eminantly chose the ascertainment of the right of the plaintiff in relation to various properties treating the said property as that of the joint family property. After making such observations the Hon’ble Court has allowed the amendment of the plaint.
Learned Advocate further submits that the application has been filed after a period of 13 years from the date of institution of the suit. Had the defendant nos. 1 and 2 genuine cause they could have filed it immediately after receiving the copy of the plaint and not waited for almost 13 years. It appears from the application that the defendant nos. 1 and 2 had prayed firstly for rejection of the plaint and alternatively for deletion of the names of the defendant nos. 1 to 34 from the array of parties.
Learned Advocate also submits that from the averments made in the plaint that the plaint discloses a cause of action against defendant no- 1 to 34. The defendants nos. 1 and 2 are the persons who did not discharge their obligation what they were entrusted upon and on the contrary they did not hold the properties as trustees of Late Arun Kumar Bhutoria for the benefit of all his legal heirs. They have misused the properties siphoned of money and those facts have been pleaded in the plaint. The amended plaint discloses cause of action against the defendant nos. 1 and 2 and/or the defendant nos. 1 to 34.
It is submitted by the Learned Advocate that the plaintiff has sought for partition of the companies namely, the defendant no-3 to 34 as the said companies were formed out of the fund of Late Arun Kumar Bhutoria. The A.K. Group of Companies was his creation and he did that out of his own fund. The question of deletion of the names of the defendant nos. 1 to 34 from the array of the parties does not and cannot arise as they are certainly necessary parties.
It is submitted that partial rejection of the plaint is not permissible in law and if it appears from a bare reading of the plaint, that a slightest cause of action is disclosed the matter should be relegated to the trial and the plaint cannot be rejected.
It is further submitted that the bar under Section 430 of the companies Act 2013 does not apply in the instant case as the instant suit is a suit for partition and the plaintiff has asked for partition of the assets and properties which belonged to her husband Late Arun Kumar Bhutoria. The companies namely the defendant nos. 3 to 34 have been impleaded because those companies were formed out of the fund of Late Arun Kumar Bhutoria. Therefore reliefs claimed by the plaintiffs in the instant suit cannot be a bar because of Section 430 of the Companies Act 2013.
It is also submitted that the bar under the provisions of the prohibition of Benami Property Transaction Act 1988 does not apply in the instant case as the properties were held for the benefits, of the members of the family and the consideration of the property which has been purchased and or created comes out from the funds of the Karta.
Learned Advocate distinguishes the decisions as relied upon by the Defendant no. 1, 2 and 3 as follows:-
2015. 8 SCC-331-It is submitted that the judgment holds that the rejection of the plaint is a drastic step and what requires to be considered under Order VII Rule 11 CPC is only the averments made in the plaint which are to be read as a whole. Therefore this decision goes against the defendant nos. 1 and 2 as the amended plaint discloses a cause of action against all the defendants.
In the matter of Bhaskar Gupta VS The Calcutta Club Limited and ors it is submitted that the judgment is distinguishable for the sole reason that the same has decided the fate of an interlocutory application filed under Order XXXIX, Rules 1 and 2 and there the issue was not of rejecting the plaint.
(1971) 3 SCC.124- With regard to this decision it is submitted that the same does not apply to this case in view of the law laid down by the Division Bench of this Court in the case of Santosh Kumar Agarwalla and others VS Sajjan Kumar Agarwalla and others.
2025. SCC. Online S.C. 1208 (Para-8) With regard to the said decision it is submitted that the said decision does not support the contention of the defendants as in paragraph 8 of the said judgment, the Court held that the rejection of the plaint under Order VII Rule 11 Code of Civil Procedure is permissible only when the plaint on its face without considering the defence fails to disclose the cause of action is barred by any law and not otherwise. At the preliminary stage the Court is required to confine its examination strictly on the averments made in the plaint and not venture into the merits and veracity of the claim.
(2013) 13 CC. 562-With regard to this judgment it is submitted that this judgment is distinguishable because here the plaintiff is claiming a right in the companies by way of inheritance as the companies were formed out of the funds of Late Arun Kumar Bhutoria since deceased. Therefore the instant suit is maintainable.
2014 Online Delhi-1320: In the said case the amendment was declined but in the instant case, the amendment was allowed and this Hon’ble Court has held that from the pleading made in the original plaint prior to amendment, it-pre-eminently exists that the property in respect of which the partition has been sought for belonged to joint family property.
2011 SCC Online Cal-1570-It is submitted that facts are different from the instant case. In the said case ad-interim order was challenged in a letters patent appeal under clause-15 of the Letters Patent. In the instant case the suit is for partition and the Court is deciding whether the suit should be dismissed at this threshold or not.
(1954) 2 SCC-563-In this matter the point involved was whether a shareholder of the company acquires merely a right to participate in the profits of the company but does not have any interest in the assets and observation was made relating to a point raised under the Income Tax Act. Here in the instant case the facts are totally different and the plaintiff’s contention is that the companies were formed out of the funds of Late Arun Kumar Bhutoria since deceased therefore the said decision is factually distinguishable.
In the matter of Baimahakore VS Bai Mangola and ors it is submitted that the point involved relating to a property held in trust based on a credit entry in books of accounts.
(2012) 8 SCC-P-706-With regard to this decision it is submitted that while scrutinizing the plaint’s averments, it is the duty of the court to ascertain the materials for cause of action. This judgment does not support the case of the defendant as from plain reading of plaint it will be clear that the plaint discloses cause of action.
Similarly it is submitted by the Learned Advocate for the plaintiff that the decisions relied upon by Learned Advocate for the defendant no. 4,5,6,10,13,24,28,30,31, and 34 namely 2025 SCC Online-Cal-8307, 2026 SCC Online Cal-7121, (2019) 18 SCC.569, 1990 (2) SCC. 42, (1970) 40 Comp. Case-138, (1977) 4 SCC-467 are not applicable to the facts of the case.
Learned Advocate for the defendant no-36 submits that by filing this application after a period of 13 years from the date of institution of the suit the object of the defendant no-1 and 2 is to cause delay in hearing of the suit. Learned Advocate further submits that in the case as made out in the amended plaint, the plaintiff has specifically sought for a decree for partition of the assets of the companies and/or assets and the properties mentioned in the schedule being Annexure E to the plaint amongst the Legel heirs of Arun Kumar Bhutoria since deceased. Learned Advocate also submits that the point the suit is barred because of Section 430 of the companies Act 2013 and the provisions of the prohibition of Benami Property Transactions Act 1988 cannot be an acceptable proposition of law as firstly the instant suit is a suit for partition and it has been categorically pleaded in the amended plaint that the properties in respect of which partition has been sought for belonged to Late Arun Kumar Bhutoria.
Before proceeding to decide on the issue it is to be remembered that while deciding an application under Order 7 Rule 11 Courts are to confine within the four corners of the plaint and not beyond that; Thus the Courts are to follow the conditions provided under Order 7 Rule 11 of the Code of Civil Procedure which are as follows:-
Order 7 Rule 11-Rejection of plaint The plaint shall be rejected in the following cases:-
a)Where it does not disclose a cause of action.
b)Where the relief claimed is undervalued and the plaintiff on being required by the Court to correct the valuation within a time to be fixed by the Court fails to do so:
c)Where the relief claimed is properly valued but the plaint is returned upon paper insufficiently stamped and the plaintiff on being required by the Court to supply the requisite stamp-paper within a time to be fixed by the Court fails to do so;
d)Where the suit appears from the statement in the plaint to be barred by any law;
Provided that the time fixed by the Court for the correction of the valuation or supplying of the requisite stamp paper shall not be extended unless the Court for reasons to be recorded is satisfied that the plaintiff was prevented by any cause of an exceptional nature from correcting the valuation or supplying the requisite stamp paper as the case may be within the time fixed by the Court and that refusal to extend such time would cause grave injustice to the plaintiff.
e)Where it is not filed in duplicate.
f)Where the plaintiff fails to comply with the provision of rule 9.
In the instant case much argument was raised on the ground that the suit is barred under law in view of the provisions contained in Section 430 of the companies Act 2013, the said section is quoted hereinbelow.
S. 430-Civil Court not to have jurisdiction-No Civil Court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal is empowered to determine by as under this Act or any other law for the time being in force by the Tribunal or the Appellate Tribunal.
Upon perusal of the relief prayed for in the plaint it will appear that the suit is filed for declaration and for partition of the assets and property mentioned in the schedule being Annexure ‘E’.
Thus from the nature of suit it is clear that Civil Courts have power to adjudicate the same as empowered under Section 9 of the Code of Civil Procedure:-
As per Section 9 of the Code of Civil Procedure the Courts shall (subject to the provisions herein contained) have jurisdiction to try all suits of civil nature excepting suits of which their cognizance is either expressly or impliedly barred.
As per Explanation I-A suit in which the right to property or to an office is contested is a suit of a civil nature notwithstanding that such right may depend entirely on the decision of questions as to religious rites or ceremonies.
As per explanation II – For the purpose of this Section it is immaterial whether or not any fees are attached to the office referred to in Explanation I or whether or not such office is attached to a particular place.
It is held in different judicial pronouncements that there is an inherent right in every person to bring a suit of a civil nature and unless the suit is barred by statute one may at one’s peril bring a suit of ones choice. It is no answer to a suit however frivolous the claim may be that law confers no such right to sue. A suit for its maintainability requires no authority of law. It is enough if no statute bars the suit.
The defendants/applicants could not satisfy this Court that the suit for partition is barred before a civil Court nor does the Companies Act 2013 provides that to obtain a declaration that a property in the name of a Company belongs to plaintiff has to move the Tribunal or Appellate Tribunal.
It is well known that disputes and differences between co-sharers gives rise to the necessity of partition of joint property. The plaintiffs have stated the cause for filing partition suit. A decree for enquiry of plaintiff’s property is also prayed for in the suit. It is necessary that all persons who are entitled to a share in the property by inheritance must be made parties to the suit for partition. As plaintiff defendant no-35,36, and 37 are heirs of Arun Kumar Bhutoria and the properties lying in the name of defendants Companies are claimed to be purchased by funds of Arun Kumar Bhutoria a declaration is sought that the said properties belong to Arun Kumar Bhutoria.
Thus it is a suit for declaration and partition which is maintainable before Civil Court.
Now with regard to Benami the property is claimed to be purchased-by Karta of a Hindu Undivided family thus it comes within exception of Section 2(9) (A)(b) of the Benami Act. The Hon’ble Division Bench of this Court in the case of Santosh Kumar Agarwal and Sajjan Kumar Agarwal FMAT No-543 of 2023 observed as follows:-
‘49. Although it is pleaded by the appellant that benami is a new ground argued for the first time in the appeal, since the court can suo moto reject the plaint under Order VII Rule 11 of the Code and/or return a plaint under Order VII Rule 10 thereof, and the argument of benami has been made on the basis of the averments in the plaint itself and no new facts are required to be decided, we are of the opinion that the said ground can be validly urged by the defendants/respondents even for the first time in the present appeal.
50.The argument of the plaintiffs/appellants that since the latest amendments to the Benami Act came in 2016, ten years subsequent to the institution of the suit, the same cannot be applied, is not acceptable, since as on the date when the application under Order VII Rule 11 of the Code was filed, the 2016Amendment had already come into force. The relevant juncture for deciding the applicability of the bar incorporated in the Benami Act by the 2016 Amendment is the date when the decree is passed. Hence, the said defence of the plaintiffs is not tenable in the eye of law.
51.Even considering from such angle, Section 2(9)(A)(b) of the Benami Act, in sub-clauses (i) and (iv) thereof, incorporates certain exceptions to the bar of benami. Sub-clause (i) contemplates, as one of such exceptions,a scenario when the property is held by a Karta or a member of a Hindu Undivided Family (HUF), if the property is held for his benefit or for the benefit of the other members in the family and the consideration for such property has been provided or paid out of the known sources of the HUF. In the present case, the said exception is very much applicable at a glance, since the entire title to the suit properties and the shares of the parties in the suit properties are claimed on the premise of the joint family nucleus which allegedly forms the basis of acquisition of the properties.
52.Again, under sub-clause (iv), where the names of the lineal ascendants or descendants and the individual appear asjoint owners and the consideration for the property has been provided or paid out of known sources of the individual, it is very much arguable that the exception to the bar envisaged in the Benami Act is attracted.
53.Such exceptions cannot be ruled out at the threshold,in the preliminary stage when the court adjudicates on an application for rejection/return of plaint. Such questions are to be decided upon taking detailed evidence and, as such, can only be finally adjudicated at the hearing of the suit upon a full-fledged trial on evidence; not at the inception under Order VII Rule 11 or Order VII Rule 10 of the Code.
54.Thus, we are of the opinion that the bar under the Benami Act is, to say the least, an arguable issue and required to be decided upon adduction of detailed evidence on facts. Hence, no occasion arises at this premature stage for the court to return the plaint or reject the plaint on the ground of benami.’
Thus the plea of Benami Transaction cannot be sustained at this stage without Trial.
Although defendant no-1 and 2 in their written notes of argument have contended and specified as to who should be necessary parties but such contention was not made in the application for dismissal of suit and is taken up for the first time in written argument thus this plea cannot be sustained. Further the plea of non-joinder of necessary parties can be taken in the written statement to enable the Court to frame an issue as to whether the suit is bad for non-joinder of necessary parties. Moreover Order 1 Rule 10(2) of the Code of Civil Procedure empowers Courts to strike out or add parties at any stage of the proceedings.
In the facts and circumstances the petition GA 11 of 2025 stands dismissed with regard to prayer a to d of the Master Summons dated 23rd day of May 2025. However with regard to prayer e in the interest of justice same stands allowed by condoning delay subject to the payment of costs of 1500 GM. by the defendant no-1 and-2/applicants. Out of 1500 GM.,1200 GM be paid to the plaintiff and 300 GM. to the Legal Aid and Advice Society West Bengal having office at New Secretariat Building Ground Floor. The written statement shall be filed within 3 weeks after vacation and costs must be paid within one week after vacation. Application GA-11/2025 stands disposed. The Suit may be placed before Regular Bench having determination in the matter for disposal.