Kunj Behari vs M/S. K.D. Churiwala & Sons Huf And ...
1989 Latest Caselaw 21 Del

ORDER

1. By this application the defendants seeks dismissal of the petition on the ground that Rishi Kumar being necessary party to the suit was added as a party after expiry of limitation and the suit has become incompetent and not maintainable. The application has arisen from the following facts. Shri Kunj Behari and Rishi Kumar filed this petition under S. 20 of the Arbitration Act praying that the agreement dated 3-2-1979 and 6-2-1979 be directed to be filed in this Court and further proceeding in the matter of appointment of arbitrator may be taken. The suit was filed by both the petitioners through one counsel Mr. Sabharwal on 12-2-1985. Petitioner 2 Rishi Kumar filed an application I.A. 939/ 85 through another counsel, Mr. Mohinder Goel and prayed that in view of the compromise arrived at between petitioner 2 and the respondent, the Court may grant him necessary permission for sale and transfer of certain flats by the respondent in favor of the petitioner 2 and may be allowed to withdraw his name from the array of the petitioners and the petition be continued in the name of other petitioner Kunj Behari petitioner 1 only. the application was directed to be listed on 21-4-1985. In view of the fact that Mr. Mohinder Goel, Advocate, had filed vakalatnama for petitioner 2, whereas previously both the petitioners were represented by one counsel Shri Sabharwal, Shri Sabharwal was discharged in respect of his vakalat nama as far as petitioner 2 was concerned, I.A. 939 / 185 was adjourned from time to time. Thereafter, the suit was listed on 1st Oct., 1985 when none appeared on behalf of the petitioners and the suit was dismissed for default. An application, I.A. 5701/85, was filed on behalf of petitioner 1 under O. 9, R. 9, C.P.C. on 4th October, 1985 for setting aside the dismissal and restoration of the suit, The application was allowed on 30th Oct., 1986. The operative portion of the order reads as under:-

"Application is, therefore, allowed and the suit is restored to its original number, as far as respondent 1 is concerned. There is no application on behalf of respondent 2. The question whether the suit is maintainable only by plaintiff No. 1 will be considered or, the next date of hearing. To be listed on 21-1-1987."

The suit was listed on 22nd Jan., 1987 to decide the question whether the suit was maintainable only by petitioner 1. On that date, Mr. Goel appeared for petitioner 2 and requested that the matter might be adjourned so as to enable petitioner 2 to file an application for restoration of the suit qua him. Request was acceded to and the matter was adjourned. In the meanwhile, petitioner 1filed an application being I.A. 656/87 under O. 1, R. 10, C.P.C. praying that petitioner 1may be permitted to transpose petitioner 2 as respondent 7 or any other order which may be just and proper be passed. Petitioner 2 also moved an application being I.A. 663 / 87 for restoration of the suit, The application was contested on behalf of the respondent and by order dt. 22-4-1987 the application was dismissed. Application of petitioner 1 under O. 1, R. 10, C.P.C. was disposed of by order dt 30-11-1987. The prayer of petitioner 1 for transposing petitioner 2 as respondent was disallowed on the ground that the person who is to be transposed as plaintiff or defendant should be a party to the suit. Since petitioner 2 ceased to be a party to the suit, as the suit qua him was dismissed. He could not be transposed as a respondent. However, it was held that petitioner 2 was a party to the arbitration agreement and he as a necessary party for these proceedings. His presence was necessary for effectual and complete adjudication of all the questions involved in the suit. The application was allowed to the extent that petitioner was permitted to implead petitioner 2 as respondent in the suit. Now, this, application, I.A. 2343/88, which is under disposal has been filed by the respondent seeking disposal of the suit on the ground that Rishi Kumar being necessary party was added as party vide order dt. 30-11-1987 after expiry of the period of limitation and, therefore, the petition should be dismissed as having become barred by time. It is stated in the application that Rishi Kumar was added as a party under the provision of O. 1. R. 10(2), C.P.C. after expiry of the period of limitation, The proceedings against Rishi Kumar shall be deemed to have taken with the service of summons within the meaning of sub-rule (5) of R. 10, O. 1. C.P.C. but no such summons have yet been served, nor can any be served long after expiry of the limitation period.

2. The application is being opposed on behalf of Kunj Behari, petitioner 1. In the reply, it is stated that the suit on behalf of Rishi Kumar was not restored. As he was a necessary party to the arbitration suit, the petitioner sought addition or transposition of Rishi Kumar in the suit. Not withstanding the dismissal of Rishi Kumar's application for restoration of the suit, the petitioner could still ask for addition of Rishi Kumar as a party to the suit. There is no question of limitation. Even otherwise the respondent has no locus standi to raise this objection. Rishi Kumar was always a party to the suit and there was no requirement to have him as respondent in this suit. It was only after Rishi Kumar's application for restoration was dismissed, the necessity of addition of Rishi Kumar arose.

3. I have heard the counsel for the parties. Contention of the applicant is that Rishi Kumar was necessary party to the suit. The suit qua him was dismissed. He was made a party to the suit by order dt. 30-11-1987. On that date, when he was directed to be added as a party, the suit had become barred by time. Sub-rule (5) of R. 10 of O. 1, C.P.C., provides that subject to the provision of Limitation Act, S. 22, the proceedings as against any person added as defendant shall be deemed to have begun only on the service of the summons. It is contended that according to the petitioner, as alleged in the plaint, cause of action arose on 26-3-83 and the suit was filed on 6-2-1984. Rishi Kumar was added as a party on 30-11-1987. The period prescribed for filing application under S. 20 of the Arbitration Act is three years from the date when the cause of action arose. Obviously, cause of action, according to the petitioner, arose on 26-3-83 and Rishi Kumar was added on 30-11-1987, which is beyond the period of limitation It is also contended that RishiKumar was a necessary party to these proceedings. In support of, his contention, the learned counsel has relied upon the following judgments: .

4. On the other hand, contention of the counsel for the petitioner is that the provisions of sub-rule (5) of R. 10, O. 1, C.P.C. are not attracted in this case. Rishi Kumar was not added as new party because of the change in the circumstances he was required to be imp leaded as a respondent initially the suit was properly instituted impleading all the necessary parties.

5. I have given my thoughtful consideration to the controversy involved There is no quarrel with the proposition of law enunciated by the counsel for the respondent. If it is held that Rishi Kumar was added as a new party to the suit and unless it is shown that it was a mistake made in good faith as contemplated under S. 20 of the Limitation Act, the petition would be barred by time. In my opinion, the contention of the petitioner is well founded. Rishi Kumar was not added as a new party to the suit. When the suit was instituted, he was one of the petitioners. Thereafter, he chose not to contest the petition. The result was that the suit qua him was dismissed. Thereafter, the petitioner Kunj Behari moved an application under O. 1, R. 10, C.P.C. for transposing the name of Rishi Kumar as respondent. This was not permitted on the ground that he ceased to be a party to the suit at that time as the suit qua Rishi Kumar stood dismissed. He was permitted to be imp leaded as respondent in the case. There is no doubt that Rishi Kumar is a necessary party because he is one of the signatories to the arbitration agreement. The necessity of impleading him as respondent had arisen because of the peculiar circumstances of the case. Petitioner is not at fault. Nothing can be attributed to the conduct of the petitioner 1. This is not a case where petitioner 2 is given up by petitioner 1 of his volition. Rishi Kumar was not imp leaded as a new party to the suit. He was already a party when the suit was instituted. Provision of O, 1, R. 10(5), C.P.C. and S 20 of Limitation Act are not attracted to the facts and circumstances of this case. The rigour of limitation as contemplated by O. 1, R. 10(5) C.P.C. and S. 20 of the Limitation Act is applicable only in those cases where a new party is added to the suit. Petitioner 2 cannot be, by his conduct, allowed to defeat the rights of petitioner 1. In the result the application fails and is dismissed with no order as to costs.

6. Application dismissed.