M/S Ms Shoes East Ltd. vs Anand Khandelwal
2016 Latest Caselaw 147 Del

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*IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                 Date of Decision: January 08, 2016
+     CS(OS) 1005/1998
      M/S MS SHOES EAST LTD.                      ..... Plaintiff
                    Through  Mr.G.P.Thareja and Mr.Pavan
                             Sachdeva, Advocates
                    versus
      ANAND KHANDELWAL A+                      ..... Defendants
                    Through  Mr.Sanjeev Anand, Advocate for
                             proposed defendants Nos.1, 2, 4 &
                             9
                             Mr. C. Rajaram & Mr. B. Anand,
                             Advocates for proposed defendants
                             Nos.7 and 10

CORAM:
HON'BLE MR. JUSTICE JAYANT NATH

JAYANT NATH, J.

IA No.7591/2006 & IA No.9204/2007

1. The plaintiff has filed the present two applications. IA No.7591/2006 is filed under Order I Rule 10 CPC for impleadment of defendants No.2 to 10, namely, Mr.Ajay Khandelwal as defendant No.2, Mrs. Vijay Prabha Khandelwal as defendant No.3, Mrs. Deepika Khandelwal as defendant No.4, Mr.Madan Lal Gupta as defendant No.5, Ram Charitable Trust as defendant No.6, Miss Mausumi Bhattacherjee as defendant No.7, Mr.Mahesh Sharma as defendant No.8, Mr.Satya Prakash Khandelwal as defendant No.9 and Arjun Industries as defendant No.10.

2. IA No.9204/2007 is filed under Order VI Rule 17 CPC for

amendment of the plaint.

3. The facts giving rise to these two applications are common. Hence, the same are being disposed of by a common order.

4. The plaintiff has filed the present suit seeking a decree of Rs.2,34,44,300/- against the defendant. The plaint is short and bereft of details. It is the contention of the plaintiff in the plaint that the plaintiff entered into a MOU dated 1.11.1994 with the defendant whereby the defendant agreed to sell the Trust Property of Ram Charitable Trust bearing Khasra No.225, Village Bhojpura, Jaipur measuring approximately 11,060 sq. yards and another plot being Khasra No.220, Village Bhojpura situated in village Bhojpura, Jaipur measuring approximately 8000 sq. yards. The responsibility of effecting transfer was on the defendant and all charges for clearance from appropriate authorities for construction of a Five Star hotel project was also the responsibility of the defendant.

5. The plaintiff is stated to have paid vide Cheque dated 25.10.1994 for Rs.5 lacs and Cheque No.29203 dated 20.03.1995 for a sum of Rs.1,50,00,000/- being a total of Rs.1,55,00,000/-. The total agreed consideration was Rs.3,00,00,000/- out of which the said Rs.1,55,00,000/- was paid to the defendant.

6. It is the contention of the plaintiff that the defendant failed to perform its obligations under the MOU. Hence, the present suit for recovery of dues with interest.

7. The suit was filed on 20.03.1998. Mr.Anand Khandelwal who was impleaded as Managing Trustee of M/s. Ram Charitable Trust, Jaipur died on 27.10.1999.

8. The plaintiff filed IA No.11960/1999 to implead the LRs of Shri Anand Khandelwal. The plaintiff also thereafter filed an application under Order 6 Rule 17 CPC read with Order 1 Rule 10 CPC, but withdrew the same with liberty to file a fresh application. As no steps were taken by the plaintiff thereafter, on 26.08.2002 the suit was adjourned sine die to be revived only when an application is filed by the plaintiff. The suit was revived by the Court on 15.09.2005 suo motto

9. On 25.03.2008 this Court dismissed IA No.11960/1999 which was filed by the plaintiff under Order 22 Rule 4 CPC. The Court concluded that the plaintiff had not sued Mr.Anand Khandelwal in his individual capacity but as Managing Trustee of Ram Charitable Trust, Jaipur. No relief was sought against Anand Khandelwal in his personal capacity. Hence, the application to implead the personal legal heirs of deceased Shri Anand Khandelwal was rejected.

10. Now, the plaintiff has filed the present two applications. The two applications are based on common facts and are inter-dependent on each other inasmuch as the impleadment of new defendants is sought based on additional facts which are sought to be added to the plaint by means of the application under Order 6 Rule 17 CPC. The two applications are hence dealt with together being in effect a composite application.

11. IA No.7591/2006 (Order I Rule 10 CPC) gives a narration in detail of the facts as to how the transaction took place between the plaintiff and defendant/Mr.Anand Khandelwal and as to why proposed defendants No.2 to 10 are necessary and proper parties. It is urged that on 1.11.1994 the defendant alongwith his son Shri Ajay Khandelwal and proposed defendant No.2, Shri Madan Lal Gupta father of Shri Anand Khandelwal

and proposed defendant No.5 approached the Managing Director of the plaintiff pointing out that the defendant is the Managing Director of the trust vide trust deed dated 28.03.1988. On the representations of Shri Anand Khandelwal and proposed defendants No.2 and 5 the MOU was signed and advance payment made.

12. Subsequently, after default as the defendant failed to refund the payment or complete the transaction, on 23.12.99 the plaintiff filed a petition under section 156(3) Cr.PC before the CMM, Tis Hazari Courts, Delhi. The Court directed registration of an FIR. Consequently, an FIR was registered under section 420/120-B/506 IPC being FIR No.41/2000 dated 20.01.2000. Based on the investigations, it is stated that certain new facts have come to light.

13. It is stated that the investigations show that the trust deed dated 28.03.1988 was amended in 1992 vide another trust deed dated 24.07.1992. The two new trustees as per registered trust deed dated 24.07.1992 are proposed as defendant No.7 and 8. On the date of the transaction in question the said two were also trustees of the defendant Trust.

14. It is further stated that Sh.Anand Khandelwal proposed defendant No.2 Shri Ajay Khandelwal and Madan Lal Gupta proposed defendant No.5 played a fraud on the plaintiff with malafide intention and for wrongful gain to themselves. They made false representations about the name of the trustees to the plaintiff and did not inform that the trust deed had been amended on 24.07.1992. Hence, it is averred that proposed defendant No.2 and proposed defendant No.5 being a party to the fraud can be sued in their individual capacity, and need to be impleaded as

defendants.

15. It is further averred that the payment was received by the trust on 20.03.1995 and on the very next date i.e. on 21.03.1995 the amount was transferred to an account of Arjun Industries Limited proposed defendant No.10. The said proposed defendant No.10 had four Directors, namely, Mr.Anand Khandelwal, Mr.Satya Prakash Khandelwal proposed defendant No.9, Miss Mausumi Bhattacharjee proposed defendant No.7 and late Shri Surender Singh. Proposed defendant No.7 was looking after the day to day affairs of proposed defendant No.10. The said Rs.1.5 crores were utilised by proposed defendant No.10 for its business purposes and in fact proposed defendant No.7 received Rs.2.5 lacs out of the said sum. In fact Rs.1,39,20,188/- was used by proposed defendant No.10 to import machinery for itself. Hence, it is urged that these proposed defendants have in conspiracy with Mr.Anand Khandelwal defrauded the plaintiff and are necessary and proper parties to the present suit.

16. As far as proposed defendant No.3 is concerned, she is the widow of the deceased late Shri Anand Khandelwal. Proposed defendant No.4 is the wife of proposed defendant No.2. They are said to have been bequeathed a portion of the residential property in Vasant Vihar in which Shri Anand Khandelwal had resided. They are intermeddlers and hence necessary and proper parties.

17. Based on the above allegations, it is urged that the plaintiff seeks to add these persons as defendants to the suit and also seeks to incorporate all these facts in the plaint by adding additional paragraphs to the said effect. The amendment application now seeks a decree of the said amount

of Rs.2,34,44,300/- against all the proposed defendants.

18. The two applications are a jumble of facts intermixed. It will be useful to categorise the proposed defendants. Essentially, there are three categories of proposed defendants. As far as defendant No.5 the father of Shri Anand Khandelwal is concerned, learned counsel made a submission that he does not press for his being impleaded as a party.

19. Proposed defendant No.2 the son of Shri Anand Khandelwal is sought to be impleaded on the grounds of having played a fraud alongwith deceased Sh.Anand Khandelwal on the plaintiff. Proposed defendants No.3 and 4 are sought to be impleaded on the grounds of having rights in the property in Vasant Vihar in which Sh. Anand Khandelwal lived. Defendants No.2 to 4 are the immediate relatives of Sh.Anand Khandelwal and form one category.

20. Proposed defendant No.10 is sought to be impleaded for having participated in a conspiracy to defraud the plaintiff inasmuch as it is urged that the funds paid pursuant to the MOU were transferred to Defendant No.10 and utilised by Defendant No.10 for its purposes. Defendants No. 7 and 9 are said to be Directors of defendant No.10 and are said to have actively participated in the said conspiracy. Proposed defendant Nos.7, 9 and 10 form the second category of proposed defendants.

21. Defendants No.7 and 8 are also sought to be impleaded on the ground of being trustees of Ram Charitable Trust. They form the third category.

22. I may also look at the replies of the proposed defendants to the two applications. An objection which is common to all the proposed

defendants is that the applications are hopelessly barred by limitation. The MOU is of 1.11.1994 and the suit is filed on 20.03.1998. Shri Anand Khandelwal has died on 27.10.1999. The plaintiff has now in 2006/2007 filed the present applications. It is urged that the claim of the plaintiff against the proposed defendants, if any is barred by limitation on the date of filing the applications and the present application cannot be allowed.

23. Proposed defendants No.2 to 4 have in their reply taken the objection that in an application to implead defendant No.2 as the LR of deceased defendant Sh.Anand Khanelwal this Court had already dismissed the application on 25.03.2008 holding that the defendant is Ram Charitable Trust and proposed defendant No.2 who was sought to be impleaded as personal LR of Sh.Anand Khandelwal would not be the appropriate LR as he is not a trustee of the Trust. It is urged that proposed defendants No.3 and 4 are also not trustees of the said Trust. The plaintiff cannot overcome the said order of this Court dated 25.03.2008 in this roundabout manner. It is further urged that proposed defendants No.3 and 4 cannot be impleaded merely because they are likely to succeed to any rights in the Vasant Vihar property.

24. Proposed defendants No.7 and 10 have filed their reply admitting the receipt of Rs.1.5 crores from Shri Anand Khandelwal. They however clarify that this payment was payment towards allotment of 15 lac equity shares in defendant No.10 which were duly allocated to him against the consideration paid. Form (II) is also said to have been submitted with ROC, Delhi. It is urged that it was a simple case of consideration received for allotment of shares and there is no question of any fraud. Proposed defendant No.7 has further admitted that she was the trustee of

Ram Charitable Trust from July 1992 to July 1993 but states that she had resigned thereafter. With the reply, copies of two documents have been filed i.e. purported resignation letter of proposed defendant No.7 dated 05.07.1993 and alleged resolution dated 30.07.1993 of the Trust accepting the resignation of proposed defendant No.7. A plea of limitation is also raised.

25. Proposed defendant No.8 has also filed his reply where he has denied the entire contents of the applications. He has showed ignorance of the transaction of the plaintiff with the defendant.

26. I have heard learned counsel for the parties and perused the record.

27. Learned counsel for the plaintiff has submitted that proposed defendant No.7 and defendant No.8 are the trustees of the Trust and are necessary and proper parties and have to be so impleaded. Under CPC all trustees who at the relevant time were trustees and who succeed the managing trustees are to be impleaded as parties to the suit and that the suit would fail in their absence. Stress is also placed on the fact that police investigation showed that proposed defendants No.7 and 8 at the relevant time were trustees.

28. Regarding proposed defendant No.10 it is urged that as he has cheated the plaintiff in conspiracy with proposed defendant Nos.7 and 9 and Sh. Anand Khandelwal they are also necessary and proper parties. Regarding defendants No.3 and 4 it is urged that they are intermeddling in the estate of the deceased defendant and hence are legal representatives as defined under section 2(11) of CPC.

29. On the issue of limitation it is urged that when the statute provides that certain parties have to be impleaded, limitation law is not applicable.

Hence, it is urged that where a statute commands the plaintiff to do something there is no question of any limitation.

30. Learned counsel appearing for the defendants have reiterated their contentions as stated in their replies.

31. I will first deal with the prayer to implead the first category of proposed defendant , i.e. defendants No.2 to 4. In my opinion, the order of this Court dated 25.3.2008 is a bar to impleadment of the said defendants No.2 to 4. This Court on 25.03.2008 held as follows:-

"There is substance in the submissions made by counsel for the legal heir of the deceased defendant. A perusal of the Memo of parties shows that the plaintiff has not sued Sh.Anand Khandelwal in his individual capacity, but as Managing Trustee of M/s Ram Charitable Trust, Jaipur. It is not the case of the plaintiff that any relief is sought against Sh.Anand Khandelwal in his personal capacity. As such the suit is based on a MOU dated 1.11.1994, a perusal of which shows that the same was executed between M/s Ram Charitable Trust, Jaipur and M/s M.S. Shoes East Limited, and not between Sh.Anand Khandelwal and Sh.Pawan Sachdeva."

32. It is not the case of the plaintiff that defendants No.2 to 4 are trustees of the trust. They are sought to be impleaded as legal representatives of Shri Anand Khandelwal in his personal capacity, i.e. intermeddling in the personal estate of Late Sh. Anand Khandelwal or playing fraud in conspiracy as alleged against proposed defendant No.2. In view of the order dated 25.3.2008 they cannot be impleaded inasmuch as this court has already held that it is the trust who is the defendant. The trust does not die. At best, the plaintiff is entitled to implead the successor trustees. Further, on allegations of fraud against proposed defendant

No.2, the claim is misconceived and barred by limitation, as elaborated later.

33. Coming to the prayer to implead proposed defendant Nos.7, 9 and 10 (defendants No.7 and 9 being Directors of defendant No.10) and amend the plaint incorporating facts alleging fraud against the said proposed defendants. The contention is that they have in connivance with Shri Anand Khandelwal cheated the plaintiff and siphoned off the funds of the plaintiff that were paid pursuant to the MOU to the Trust. The proposed defendants have denied the contention of the plaintiffs claiming that the money was received as consideration for shares allotted. However, while disposing off the present application this Court is not required to go into the merits of the contention of the plaintiff.

34. However, in my opinion, the said proposed amendment of the plaintiff is misconceived. It proposes to introduce in the plaint a claim which is on the date of the applications barred by limitation. The MOU between the parties is of 1.11.1994. Rs.1.5 crore was paid on 20.3.1995. The suit was filed on 20.03.1998. As per the averments in the present application the defendant has transferred Rs.1.5 crores to defendant No.10 vide cheque dated 20.03.1995. Now in 2006, to amend the present plaint to add this claim after a lapse of 9 years would be clearly hit by law of limitation. It is true, that facts now sought to be added are facts which as per the plaintiff came to their knowledge after filing of the suit. However, the application is silent about the date of knowledge of the plaintiff of these facts.

35. It may be noted that the applications of the plaintiff states that an FIR was registered on 20.01.2000 on the complaint of the plaintiff. It is

stated that the investigation of the police revealed that the payment of Rs.1.5 crores was given to the proposed defendant No.10 by Shri Anand Khandelwal. Defendant No.10 does not deny receipt of the money but states it is for consideration. If an FIR was registered in 2000 presumably the police investigations took place in 2000 itself. In the arguments, there were no averments made about the outcome of the FIR. However, the record reveals that the plaintiff filed one application in 2011 being IA 11829/2011 under Section 151 CPC for allowing service on proposed defendant No.6 through its trustee i.e. proposed defendants No. 7 and 8. Along with this application a photocopy of the chargesheet was attached which is said to have been filed by the police pursuant to the FIR of 2000. The date on the chargesheet is not very legible but appears to be 31.05.2001. Hence, by 2000/2001 the plaintiff had presumably full knowledge about the facts on the basis of which the amendment application is filed in 2006/2007. Even counted from the date of knowledge, the claim now sought to be added is barred by limitation.

36. The conduct of the plaintiff in pursuing this case may also be noted. The suit was registered as per order dated 28.05.1998. Thereafter, the matter has been continuously dragged on account of non-prosecution of the matter by the plaintiff. On 09.10.2001, on an application filed by the plaintiff under Order 6 Rule 17 read with Order 1 Rule 10 CPC being IA No. 9526/2001 the court noted that the plaintiff seeks to implead certain more persons as parties and noted that there are certain formal defects in the application and permitted the plaintiff to withdraw the application with liberty to file a fresh application. Thereafter, the plaintiff kept requesting for adjournment. On 26.08.2002 the court noted that

despite opportunity the application has not been filed and adjourned the suit sine die stating that it would be revived when the application is filed. No steps were taken by the plaintiff despite this order. On 15.09.2005, this court issued notice to the counsel for the parties and revived the suit. It is only thereafter that the present applications have been filed. On the face of it, the proposed claim of the plaintiff when the present applications were filed in 2006/2007 had become barred by limitation.

37. The law as regard to amendment is quite clear. Normally, the amendments in the plaint which seek to introduce claims which are barred by limitation are not to be allowed to be added. Reference may be had to the judgment of the Supreme Court in the case of Muni Lal vs. Oriental Fire & General Insurance Co. Ltd. & Anr., (1996) 1 SCC 90, where the Supreme Court held as follows:-

"5. Admittedly, by the date of the application for amendment filed, the relief stood barred by limitation. The question, therefore, is whether the Court would be justified in granting amendment of the pleadings in such manner so as to defeat valuable right of defence of bar of limitation given to the defendant.....

6. On a consideration of this case in its proper perspective, we are of the view that granting of amendment of plaint seeking to introduce alternative relief of mandatory injunction for payment of specified amount is bad in law. The alternative relief was available to be asked for when the suit was filed but not made. He cannot be permitted to amend the plaint after the suit was barred by limitation during the pendency of the proceeding in the appellate court or the second appellate court. Considered from this perspective, we are of the opinion that the District Court and the High Court were right in refusing the prayer of amendment of the suit and the courts below had not

committed any error of law warranting interference."

38. Similarly in Revajeetu Builders and Developers vs. Narayanaswamy and Sons & Ors., (2009) 10 SCC 84, the Supreme Court noted as follows:-

"63. On critically analyzing both the English and Indian cases, some basic principles emerge which ought to be taken into consideration while allowing or rejecting the application for amendment:

(1) Whether the amendment sought is imperative for proper and effective adjudication of the case?

(2) Whether the application for amendment is bona fide or mala fide?

(3) The amendment should not cause such prejudice to the other side which cannot be compensated adequately in terms of money;

(4) Refusing amendment would in fact lead to injustice or lead to multiple litigation;

(5) Whether the proposed amendment constitutionally or fundamentally changes the nature and character of the case? and (6) As a general rule, the court should decline amendments if a fresh suit on the amended claims would be barred by limitation on the date of application.

These are some of the important factors which may be kept in mind while dealing with application filed under Order VI Rule 17. These are only illustrative and not exhaustive."

39. In Pankaja and Anr. vs. Yellappa (D) by Lrs. & Ors., AIR 2004 SC 4102, the Supreme Court did mention that court has a discretion to even allow amendments which are barred by limitation. The court held as follows:

"14. The law in this regard is also quite clear and consistent that there is no absolute rule that in every case where a relief is barred because of limitation an amendment should not be allowed. Discretion in such cases depends on the facts and circumstances of the case. The jurisdiction to allow or not allow an amendment being discretionary the same will have to be exercised in a judicious evaluation of the facts and circumstances in which the amendment is sought. If the granting of an amendment really subserves the ultimate cause of justice and avoids further litigation the same should be allowed. There can be no straight jacket formula for allowing or disallowing an amendment of pleadings. Each case depends on the factual background of that case."

40. However, in this case given the lackadaisical manner in which the plaintiff has been prosecuting the present case, I am not inclined to exercise discretion in favour of the plaintiff and permit the amendment of the plaint introducing a claim which is barred by limitation. To recapitulate some of the relevant facts in this regard. The MOU between the plaintiff and the defendant is dated 01.11.1994. The suit is filed on 20.03.1998. Sh. Anand Khandelwal has died on 27.10.1999. The application under Order XXII Rule 4 CPC was filed for impleading the LRs of Sh. Anand Khandelwal in the year 1999. Thereafter, virtually no steps have been taken to prosecute the present suit. The suit was adjourned sine die on 26.08.2002. On 15.09.2005 this Court revived the suit. The application under Order I Rule 10 and the application under Order 6 Rule 17 CPC were filed finally in 2006/2007. Further, the police has filed chargesheet in 2001 on the strength of which it appears that, though not specifically stated, that the plaintiff received knowledge about the involvement of the defendant Nos.6 to 10. It is clear that the plaintiff

has acted in a highly casual and lethargic manner. Application lacks bona fide and no discretion can be shown in favour of the plaintiff to permit introduction of a time barred claim by way of amendment.

41. There is another reason which persuades me to disallow the present application for amendment/impleadment of defendants No. 7, 9 and 10 on the ground of having fraudulently deceived the plaintiff. The original suit is based on the MOU between the plaintiff and Ram Charitable Trust dated 01.11.1994 and the advance paid to Ram Charitable Trust pursuant to the said MOU. As Ram Charitable Trust had failed to perform its obligations, a refund has been sought from the said Trust. The original cause of action is based on breach of the MOU dated 01.11.1994. Now a new cause of action is proposed to be added based on alleged cheating, fraud and conspiracy by late Sh.Anand Khandelwal and defendants No. 7, 9 and 10.

42. On the issue of change in the nature of the suit the Supreme Court in Ganesh Trading company vs. Moji Ram, (1978) 2 SCC 91 held as follows:-

"5. It is true that, if a plaintiff seeks to alter the cause of action itself and to introduce indirectly, through an amendment of his pleadings, an entirely new or inconsistent cause of action, amounting virtually to the substitution of a new plaint or a new cause of action in place of what was originally there, the Court will refuse to permit it if it amounts to depriving the party against which a suit is pending of any right which may have accrued in its favour due to lapse of time. But, mere failure to set out even an essential fact does not, by itself, constitute a new cause of action. A cause of action is constituted by the whole bundle of essential facts which the plaintiff must prove before he can succeed in his suit. It must be antecedent to the

institution of the suit....."

43. To the same effect is the judgment of the Supreme Court in the case of Revajeetu Builders and Developers vs. Narayanaswamy and Sons & Ors.(supra). It is obvious that the plaintiff seeks to introduce a virtually new cause of action. The original suit is based on breach of the MOU dated 01.11.1994. Now a new cause of action is sought to be added of loss allegedly suffered by the plaintiff on account of fraud and criminal conspiracy by Sh. Anand Khandelwal and defendant Nos.7, 9 and 10. A complete new cause of action is sought to be introduced. To introduce the new cause of action, large number of new facts are proposed to be added. It will change the entire nature of the suit. The amendment of the plaint to add facts pertaining to proposed defendants No.7,9 and 10 cannot be permitted on this ground also.

44. The last leg of the contention of the plaintiff is to implead proposed defendants No.7 and 8 as trustees of Ram Charitable Trust. It is the allegation of the plaintiff that as per amended trust deed dated 24.07.1992 the proposed defendants were trustees in the trust on the date of the transaction. Proposed defendant No.2 Shri Ajay Khandelwal has filed documents one of them being a photocopy of the said trust deed dated 24.07.1992. A perusal of the same shows that proposed defendants No.7 and 8 as per the said registered trust deed were also inducted as trustees in place of previous trustees w.e.f. 24.07.1992.

45. Proposed defendant No.7 has admitted being a trustee but states that she resigned in July 1993. She has filed copy of the resignation letter dated 5.7.1993 and a copy of the purported resolution dated 30.07.1993 of the trustees accepting her resignation. The proposed defendant No.7

was inducted as a trustee based on a registered document, namely, the amended trust deed dated 24.07.1992. She has not placed on record any amendment to the registered trust deed. She also does not mention as to whether anybody else succeeded her as a trustee. The authenticity and validity of her resignation letter and resolution of the trust are disputed questions of facts. These issues will have to be gone into at the time of trial.

46. Regarding proposed defendant No.8 he only makes a general denial in his reply. In my opinion, proposed defendants No.7 and 8 were prima facie trustees on the date of the MOU and would be necessary and proper parties as trustees of the Ram Charitable Trust.

47. The question of limitation would also arise when permitting defendant Nos.7 to 8 to be impleaded. On the issue of limitation in the context of proposed defendants No.7 and 8, reference may be had to a judgment of the Madhya Pradesh High Court in the case of Khasgi Trust Shri And Anr. vs. Mahesh Kumar Naraindas Khandelwal, 1992 JLJ 315(MANU/MP/0356/1992). This was a suit filed by a tenant for permanent preventive injunction. A preliminary issue was framed as to whether the suit is maintainable as defendant No.1 was a Trust and not a jurisitic person. It was urged that a suit instituted impleading the trust without impleading the trustees, the trust not being a legal entity would not be properly instituted. The Court (Justice R.C.Lahoti, as he then was) held as follows:-

"15. On a review of several authorities noticed herein- above and following the law laid down by the Apex Court in its application to the facts of the present case it must be held that though the suit was filed against a Trust in the

name of the Trust without impleading all or any of the trustees, the error or omission was not a deliberate one, the Plaintiff had intended to sue the trustees and the name of the Trust impleaded as Defendant No. 1 should be deemed to be a collective description of the trustees who should have been sued. If only the defect would have been pointed out at a proper stage the Plaintiff would certainly have taken prompt steps, as he has done, in rectifying the same. The suit cannot be thrown out on the belated objection raised for the first time before this Court and here too belatedly. Order 1, Rule 10 Code of Civil Procedure is clearly attracted to the facts of the case and impleading of the trustees, if allowed at this stage, would not be a case of new parties being joined but would have the effect of curing the defect retrospectively."

48. In the present case the suit has been filed effectively against the trust impleading only the Managing Trustee. Other trustees have not been impleaded as a party erroneously. In my opinion, this is a curable defect and cannot oust the plaintiff especially as the Trust never came forward to defend the case or take any such objection.

49. Reference may again be had to the judgment of the Supreme Court in the case Ganesh Trading company vs. Moji Ram (supra) where the Supreme Court held as follows:-

"2. Procedural law is intended to facilitate and not to obstruct the course of substantive justice. Provisions relating to pleadings in civil cases are meant to give to each side intimation of the case of the other so that it may be met, to enable Courts to determine what is really at issue between parties, and to prevent deviations from the course which litigation on particular causes of action must take."

"5. It is true that, if a plaintiff seeks to alter the cause of action itself and to introduce indirectly, through an

amendment of his pleadings, an entirely new or inconsistent cause of action, amounting virtually to the substitution of a new plaint or a new cause of action in place of what was originally there, the Court will refuse to permit it if it amounts to depriving the party against which a suit is pending of any right which may have accrued in its favour due to lapse of time. But, mere failure to set out even an essential fact does not, by itself, constitute a new cause of action. A cause of action is constituted by the whole bundle of essential facts which the plaintiff must prove before he can succeed in his suit. It must be antecedent to the institution of the suit. If any essential fact is lacking from averments in the plaint the cause of action will be defective. In that case, an attempt to supply the omission has been and could sometime be viewed as equivalent to an introduction of a new cause of action which, cured of its shortcomings, has really become a good cause of action. This, however, is not the only possible interpretation; to be put on every defective state of pleadings. Defective pleadings are generally curable, if the cause of action sought to be brought out was not ab initio completely absent. Even very defective pleadings may be permitted to be cured, so as to constitute cause of action where there was none, provided necessary conditions, such as payment of either any additional court fees, which may be payable, or, of costs of the other side are complied with. It is only if lapse of time has barred the remedy on a newly constituted cause of action that the Courts should, ordinarily, refuse prayers for amendment of pleadings."

Accordingly, defendants No.7 and 8 are liable to be impleaded as defendants No.2 and 3 being prima facie trustees of defendant trust on the date of the transaction.

50. Hence, IA No. 7591/2006 is allowed to the extent that the proposed defendants No.7 and 8 are impleaded along with the proposed defendant trust as the defendants to the suit. The plaintiff may file amended memo

of parties within four weeks.

51. The issue comes about the consequential amendments to the plaint. IA No. 9204/2007 seeks amendments in the plaint which are all inter- mixed. The paras dealing with alleged conspiracy and misappropriation by the proposed defendants No. 7, 9 and 10, contentions regarding proposed defendants No. 2 to 4 are mixed up with the contention that the proposed defendants No.7 and 8 were trustees of the Ram Charitable Trust on the date of the MOU. Hence, the present application as framed cannot be allowed and is dismissed. However, liberty is granted to the plaintiff to within four weeks from today file a fresh application for amendment of plaint for adding paras pertaining to the factum of the defendant No.7 (Miss Mausumi Bhattacharjee) and defendant No. 8 (Mr.Mahesh Sharma) being impleaded as trustees of the Ram Charitable Trust, defendant No.6.

52. With these directions, the present two applications stand disposed off.

(JAYANT NATH) JUDGE JANUARY 08, 2016 N