Bombay High Court

Messrs.Hongkong Investment Co vs Alvaro Jose Elvino De Braganza on 15 December, 2008

Bench: A.M. Khanwilkar

          IN THE HIGH COURT OF JUDICATURE AT BOMBAY

            ORDINARY ORIGINAL CIVIL JURISDICTION

                 CHAMBER SUMMONS NO.1114 OF 2007
                               IN
                       SUIT NO.937 OF 1974




                                                               
     Messrs.Hongkong Investment Co.
     Pvt.Ltd.                                ...Plaintiffs




                                       
           V/s.

     Alvaro Jose Elvino De Braganza
     & Anr.                                  ...Defendants




                                      
           And

     Hongkong Investment Company
     Pvt.Ltd. (In Liquidation)               ...Applicant




                             
           And

     Maria Lalita Braganza & Ors.            ...Respondents
                   ig         WITH
                 
             COMPANY APPLICATION NO.464 OF 2007
                             IN
               COMPANY PETITION NO.141 OF 1989
                            WITH
                OFFICIAL LIQUIDATOR'S REPORT
      


     Kalawanti Shamsunder Advani             ...Applicant
   



         Versus

     Lila Filomena & Ors.                    ...Respondents





                              WITH

              COMPANY APPLICATION NO.37 OF 2008
                             IN
               COMPANY PETITION NO.141 OF 1989





     Mr.Indresh Shamsunder Advani & Ors. ...Applicants

        Versus

     M/s.Hongkong Investment Co.Pvt.Ltd.
     (In liquidation)                    ...Respondents

                             ......

     Mr.Rajeev   Ravi i/b M/s.Bilawala           &    Co.          for
     Applicant/Official Liquidator.




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     Mr.Milind   Sathe with          Mr.Chirag Balsara  i/b
     Junnarkar & Associates         for Respondent No.2 in
     Chs/1114/2007.




                                                                       
     Mr.Satish Shah i/b Munir Merchant for Applicants in
     CA/37/2008.




                                               
                               ......

                               CORAM:       A.M.KHANWILKAR, J.

DECEMBER 15, 2008.

P.C.

1. Heard Counsel for the parties.

Although all Respondents are served, only

Respondent No.2 has appeared to oppose this

Application.

3. The Applicants pray for following reliefs

in the present Chamber Summons:

"(a) that the abatement of the suit, if any, be set aside;

(b) that the delay of about 17-1/2 years in making the present application be condoned;

(c) that the Applicant be permitted to amend the plaint and proceedings as per the Schedule appended hereto and the

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Applicant and Respondents be brought on record of the suit;

(d) that costs of this Chamber Summons and of the orders to be made thereon be

provided for;

And

(e) for such other and further reliefs as the nature and circumstances of the case may require be granted."

4. Insofar as prayer clause (a) is concerned,

I am in agreement with the argument of the

Plaintiffs that the same is redundant. This is so

because in the proceedings such as the present one,

provisions of Order 22 Rule 4 of the Code of Civil

Procedure will have no application.

5. The question, however, is: whether the

decree passed by this Court on 2nd March 1979 is a

preliminary decree or can be treated as final

decree. Relying on the operative part of the

Judgment and Decree, Counsel for the Respondent

No.2 submits that it is a final decree. The

operative part reads thus :

"There shall be a Decree in terms of Prayers (a), (c) and (d). As regards

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rendition of the Accounts, the Suit is referred to the Commissioner for Taking Accounts. Costs and further orders reserved.

At this stage, Mr.Mody applies for Appointment of Receiver. Order dictated separately."

6. Besides the reliefs already granted, the

Plaintiffs have asked for further reliefs in the

Suit in the following terms:

"(b) that, in the alternative to prayer

(a) above, the said Partnership firm of

"Messrs.Shamkala Farms and Motels: between the Plaintiffs and the Defendants be dissolved by this Honourable Court as from the 14th day of September 1974, or

the date of this suit, or from such other date as to this Honourable Court may seem just;

(e) that the Defendants may be ordered and decreed to render a full true and complete

account of their dealings and transactions with the properties and assets of the said

firm including the said immoveable property more particularly described in Exhibit "A" here, and the produce, rents, incomes, and profits thereof as also of all amounts received or receivable by them

for or in connection therewith on the footing of wilful default;

(f) that the Defendants may be ordered and decreed to pay to the Plaintiffs the amounts that may be ascertained and/or

found to be due and payable to the Plaintiffs at the foot of the said accounts with interest thereon at the rate of 6% (six per cent) per annum from the

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fate of the suit till payment and/or realisation;

(g) that for the purposes of prayers (a) to (f) above, all inquiries be made,

accounts taken, directions given and Orders passed as to this Honourable Court may appear just and proper."

7. Going by the said pending reliefs read

with the Judgment as a whole and in particular, the

operative part of the decree reproduced hitherto, I

have no hesitation in taking the view that the

Judgment and Decree dated 2nd March 1979 is only a

preliminary decree. If it is a preliminary decree,

in the light of exposition of Division Bench of our

High Court in the case of Dawarali Jafarali Saiyad

vs. Bai Jadi & Ors. reported in A.I.R. 1940 Bom.

318, 318 provisions of Order 22 Rule 4 will have no

application. This settled legal position has been

restated by the Apex Court in the case of Ratna @

Ratnavati (Smt.) vs. Syndicate Bank & Ors.

     reported    in   (1995) 1 SCC 407.
                                   407           Relevant          part      of

Para 6 of the said decision reads thus:

"6............ The preliminary decree declares rights of the plaintiff and liabilities of the respective defendants and they become final. The suit would not

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abate between the date of preliminary decree and final decree. In this view of the matter, the question which emerges is whether it is not necessary for the decree-holder to make an application

within the limitation prescribed under Article 120 of the Schedule to the Limitation Act, 1963 to have the legal

representatives brought on record. Section 52 CPC adumbrates that a money decree passed against the legal representative of the deceased defendant, out of the property of the deceased in his

hands, may be executed by attachment or sale of that property. If the legal representatives fail to satisfy the court that he duly applied the property to discharge the debt or the court is not

satisfied of his so doing, the court would proceed against the legal representatives personally and to apply the property by

sale to satisfy the decree debt. At the time when the application for passing the final decree is filed, it is enough if the legal representatives are impleaded, all

or any of the legal representatives or one of the LRs of the deceased defendant judgment-debtor to represent the estate of the deceased. If death of defendant takes place pending passing of final decree they may be brought on record under Section 151

CPC or Order 1 Rule 10 CPC."

(emphasis supplied)

8. There is one more decision on which

reliance is rightly placed by the Counsel for the

Plaintiffs in the case of Bhusan Chandra Mondal vs.

Chhabimoni Dasi reported in A.I.R. (35) 1948 Cal.

363. As aforesaid, the Judgment and Decree dated

2nd March 1979 is only a preliminary decree, for

which reason, provisions of Order 22 Rule 4 will

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have no application. It necessarily follows that

relief in terms of prayer clause (a) is

unnecessary.

9. Insofar as prayer clause (b) is concerned,

the matter has been contested by the Respondent

No.2 on the assertion that the original Plaintiffs

were fully aware about the death of concerned

Defendants as back as in 1982 itself. In any case,

the Official Liquidator became aware of that fact

the year 1990. No explanation is offered as to

why steps have not been taken immediately

thereafter by the Official Liquidator. The

argument though attractive at the first blush,

however, deserves to be rejected. The Apex Court

in the case of Ratna @ Ratnavati (supra) has

observed that at the time when the Application for

passing final decree is filed, it is enough if the

legal representatives are impleaded. The Court

went on to observe that if death of Defendant takes

place pending passing of final decree, legal

representatives can be brought on record under

Section 151 of the C.P.C. or under Order I Rule 10

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of C.P.C.

10. To get over this position, Counsel for the

Respondent No.2 submits that this decision of the

Apex Court can be distinguished, keeping in mind

provisions of Article 137 of the Limitation Act.

This argument merely deserves to be stated to be

rejected. If the exposition of the Apex Court is

considered in proper perspective, it goes on to

observe that the Suit which is pending for final

decree cannot abate merely because the Defendant

has died in the intervening period after the making

of the preliminary decree. The Apex Court has

considered the provisions of Article 120 of the

Limitation Act as well as Section 52 of C.P.C. to

take the view that it is enough if the legal

representatives are impleaded before passing of

final decree. If there is no question of abatement

coupled with the fact that it is open to apply for

impleadment of the heirs and legal representatives

at the time of applying for passing of a final

decree, the fact that the present Application has

been filed after almost 17 years by the Official

Liquidator, does not affect the merits of the

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Application. Significantly, in the present case,

Application for passing of the final decree is yet

to be considered. In my view, it is indisputable

that the final decree is yet to be passed. Indeed,

according to the Respondent No.2 the decree passed

by this Court itself is a final decree, which

contention I have already rejected. If I were to

hold that the said decree is a final decree, then

obviously the question of entertaining the present

Application would not have arisen.

11. In

the circumstances, even if the present

Application is filed after lapse of 17 years that

would make no difference. For, that request can be

entertained in exercise of powers under Section 151

of the C.P.C. or can be proceeded on the basis of

Order 1 Rule 10 of the C.P.C. at any time while or

before considering the Application for passing a

final decree. Thus understood, the right to apply

accrues at the time of considering the Application

for passing a final decree. On this finding, the

present Application is not hit by the provisions of

Article 137 of the Limitation Act. In the fact

situation of the present case, therefore, in the

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interest of justice, I am inclined to entertain

this Application since the Suit has not progressed

even an inch after the passing of the preliminary

decree dated 2nd March 1979. More so, the Official

Liquidator is espousing the cause of the

stakeholders of the Company which is in

liquidation. The interest of stakeholders in the

Company will have to be secured by the Official

Liquidator in right earnest. Even for that reason,

though this Application is filed after over 17

years, I am inclined to entertain the same in the

interest of justice.

12. It is not necessary for me to elaborate on

the stand taken by the Plaintiffs that the

Respondents have withdrawn Suit No.46/82/A in the

Court of Civil Judge, Senior Division, Panaji so as

to frustrate the issues required to be addressed in

considering Notice of Motion No.649 of 1982. I do

not wish to consider the argument of the Plaintiffs

about the conduct of the Respondents in the present

Application. The same is left open to be

considered at the appropriate stage.

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     13.          Counsel      for    the       Respondent           No.2       then

     contends      that      if the Court is inclined to                    ignore

     the    delay      of    17 and a half years and                 allow        the




                                                                               
     Application        in    terms      of prayer clause              (c),       may




                                                      
     observe      that the impleadment of the Respondents is

     for    the    limited        purpose      of   passing          the      final

     decree,      while      it    will    always        be     open       to     the

Respondents to challenge the preliminary decree, if

so advised. Counsel for the Plaintiffs has invited

my attention to the purport of Section 97 of the

C.P.C. to counter this argument. However, it is

not necessary ig to make any observation in that

behalf in the present Application. Those

questions, as and when are required to be

addressed, will have to be considered on its own

merits at the appropriate stage.

14. In the circumstances, Application is made

absolute in terms of prayer clauses (b) and (c).

Amendment be carried out within one week from