IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION APPEAL APPEAL APPEAL NO. 598 OF 2005 NO. 598 OF 2005 NO. 598 OF 2005 WITH WITH WITH CHAMBER CHAMBER CHAMBER SUMMONS NO.961 OF 2005 SUMMONS NO.961 OF 2005 SUMMONS NO.961 OF 2005 1. M/s.Chitralekha Builders. 2. Smt.Nina Anil Shah. ... Appellants. V/s. 1. G.I.C. Employees Sonal Vihar Co-op. Housing Society Ltd. 2. Shri Pandurang Harichandra Vaity, 3. Smt.Damayanti P. Vaity, 4. Shri Pradip Pandurang Vaity, 5. Shri Kishore Pandurang Vaity, 6. Kum.Sadhana P. Vaity, 7. Kum.Nirmala P. Vaity, 8. Gopal Harishchandra Vaity, 9. Smt. Mahananda Gopal Vaity, 10. Kiran Gopal Vaity, 11. Mahesh Gopal Vaity, 12. Madhukar Gopal Vaity, 13. Avnish Gopal Vaity, 14. Vasudev Harishchandra Vaity, 15. Smt.Nandini Vasudev Vaity, 16. Kum.Swati V. Vaity, 17. Kumar Dipak V. Vaity, 18. Kum.Priti V. Vaity, 19. Kumar Sandip V. Vaity, 20. Anant Langda Vaity, 21. Smt.Sunanda Anant Vaity, - 2 - 22. Smt.Thakibai Baburao Vaity, 23. Bhiwa Bama Vaity, 24. Smt.Devikabai Bhima Vaity, 25. Manhor Bhiwa Vaity, 26. Kamlakar Bhiwa Vaity, 27. Namdev Bhiwa Vaity, 28. Kum.Sharda Bhiwa Vaity, 29. Dilip Bhiwa Vaity, 30. Premnath Bhiwa Vaity, 31. Bharti Bhiwa Vaity, 32. Kum.Rajani Bhiwa Vaity, 33. Ravindra Bhiwa Vaity, 34. Dinesh Bhiwa Vaity, 35. Barat Yesu Vaity, 36. Kusum Yesu Vaity, 37. Revati Yesu Vaity, 38. Smt.Bhima Bhiku Kenu, 39. Smt.Savitri Baburao Vaity, 40. Smt.Tai Baburao Madhani, 41. Yamuna Ganesh Vaity, 42. Malati Wife of Kamlakar Patil, 43. Bhalchandra Atmaram Patil, 44. Lalita Bhalchandra Vaity, 45. Smt.Prabhavati Anand Madhani, 46. Smt.Narmada Damodar Vaity, 47. Smt.Manjua Ratnakar Vaity, 48. Smt.Gulab Bhagwan Subedar, - 3 - 49. Jaywant Damodar Vaity, 50. Ganesh Damodar Vaity, 51. Kailash Damodar Vaity, 52. Shri Hemant Damodar Vaity, 53. Kumar Keshamath Damodar Vaity, 54. M/s.Shreenath Builders, 55. Mrs.Kusum Bhaskarrao Gorule. ... Respondents. E.K.Sasidharan for the appellant H.N.Thakore with Ms.Jyoti Ghag i/b. Thakore & Jariwala for respondent No.1. Bimal Bhabhde i/b. Apte & Co. for respondent Nos.2 to 52. P.S.Rao i/b. A.C.Mahimkar for respondent No.54. CORAM CORAM CORAM : V.C.DAGA AND A.S.AGUIAR, JJ. : V.C.DAGA AND A.S.AGUIAR, JJ. : V.C.DAGA AND A.S.AGUIAR, JJ. RESERVED RESERVED RESERVED ON : 2nd August, 2005. ON : 2nd August, 2005. ON : 2nd August, 2005. PRONOUNCED PRONOUNCED PRONOUNCED ON : 19th August 2005. ON : 19th August 2005. ON : 19th August 2005. JUDGMENT JUDGMENT JUDGMENT : : : (Per V.C.Daga, J.) -------- -------- -------- . Admit. 2. Heard finally by consent of parties at the stage of admission, dispensing with the record and proceedings since the parties agreed that all the relevant documents for deciding appeal are available on record. - 4 - 3. This appeal is directed against the order dated 26th October, 2004 passed by learned single Judge to the extent it rejects Chamber Summons No.1334/2004 in Suit No.1335/1988. 4. The chamber summons was moved by the appellants to become co-plaintiffs in the suit filed by respondent No.1 and respondent No.55 against respondent Nos.2 to 54 (original defendant Nos.1 to 53). According to the appellants, they were and are interested in the suit property. Without their presence all the questions involved in the suit cannot be effectually and completely decided. Outline Outline Outline Chronology : Chronology : Chronology : ----------------- ----------------- ----------------- 5. The outline chronology leading to the present appeal is as under: 6. The property in question bears Survey No.281, C.T.S.No.727; admeasuring 5082 sq.yrds. or thereabout equivalent to 4249.29 sq.mts. situated at village- Mulund, Taluka- Kurla, Mumbai- 400 080; more particularly described in Exh.B forming part and parcel of the plaint ("the suit property" for short). - 5 - 7. The parties to the appeal are hereinafter referred to in their original capacity i.e. as described in the suit for the sake of clarity. 8. The suit was filed for specific performance of an agreement dated 28th April, 1980 entered into between plaintiff No.2 - Mrs.Kusum Gorule @ Geetanjali Sohani ("Mrs.Kusum" for short) and defendant Nos.1 to 52 in the suit/ respondent Nos.2 to 53 herein, the original owners of the suit property ("Vaity family"). According to the plaintiffs, an agreement dated 28th April, 1980 was for the benefit of plaintiff No.1/ respondent No.1 - G.I.C. Employees Sonal Vihar Co-operative Housing Society Ltd. ("G.I.C. Society" for short) with whom Mrs.Kusum under an agreement dated 9th May, 1980 agreed to provide constructed area after developing the suit property. 9. The suit filed was registered as Suit No.1335 of 1988 on the original side of this Court. During the pendency of the suit, disputes and differences arose between plaintiffs inter se and they found it difficult to prosecute suit as co-plaintiffs. Consequently, Chamber Summons No.1324/2003 was taken out by plaintiff No.1 (G.I.C. Society) for transposition of plaintiff No.2 (Mrs.Kusum) as defendant, along with another Chamber Summons No.1325/2003 for amendment to implead the present - 6 - appellants, applicants in Chamber Summons No.1324/2003 so as to make them parties to the suit as defendants along with plaintiff No.2. As a counter blast, Chamber Summons No.276/2004 was taken out by plaintiff No.2 - Mrs.Kusum to transpose plaintiff No.1 as defendant. 10. The present appellants had also taken out Chamber Summons No.1334/2004 to become co-plaintiffs in the suit contending that plaintiff No.2 Mrs.Kusum had transferred her interest in the agreement dated 28th April, 1980 in favour of the partnership firm M/s.Chitralekha Builders of which appellant No.2 is one of the partners with Mrs.Kusum and two others. 11. The chamber summons was opposed by the plaintiffs contending that the appellants herein could not be the co-plaintiffs in absence of their consent since the plaintiffs are ‘dominus litis’. The learned single Judge, simultaneously, heard all the chamber summonses and chose to dispose them of by a common order dated 26th October, 2004, the details of which are given hereinafter. 12. Chamber Summons No.1325/2003 taken out by plaintiff No.1 (G.I.C. Society) came to be rejected, where as Chamber Summons Nos.1324/2003 and 276 of 2004 came to be allowed in terms of the following order : - 7 - (i) Plaintiff no.1 is transposed as Defendant No.54. (ii) Plaintiff no.2 shall not settle compromise or withdraw the suit without giving at least four weeks written notice of her intention to do so to Plaintiff no.1 and their advocates. (iii) If Plaintiff no.2 withdraws or compromises the suit in any manner and for any reason whatsoever, Plaintiff no.1 shall without further orders be transposed as the Plaintiff. (iv) It will be open to Plaintiff no.1 to continue even as a Defendant to take all steps, and urge all contentions in support of the decree sought. It is agreed between the parties that in the prayers the reference to Plaintiff no.1 shall now read as Defendant no.54 without a formal amendment to that effect. (v) The disputes between the Applicants in Chamber Summons No.1334 of 2004 and Plaintiff no.2 shall not affect the rights of Plaintiff no.1 in any manner whatsoever. 13. Chamber Summons No.1334/2004 taken out by the appellants herein also came to be rejected. This order to the extent it rejects Chamber Summons No.1334/2004 is a subject matter of challenge in this appeal. Subsequent Subsequent Subsequent Events : Events : Events : ----------------- ----------------- ----------------- 14. The ordinary rule of civil law is that rights of the parties stand crystalised on the date of institution of lis. However, the Court has power to take note of the subsequent events and mould relief - 8 - accordingly. The subsequent events urged by the appellants are basically the factual events, which are not in dispute. They were allowed to be brought on record by way of affidavits and counter affidavits. 15. The appellants have filed affidavit dated 25th July, 2005 stating that subsequent to the impugned order dated 26th October, 2004, plaintiff No.1 (respondent No.1 herein) (G.I.C. Society) was transposed as defendant No.54, with the result, original plaintiff No.2 (respondent No.55 herein; Mrs.Kusum) alone continued to be the plaintiff. Mrs.Kusum during the pendency of the suit, entered into consent terms with Vaity family , defendant Nos.1 to 52 (respondent Nos.2 to 53). The consent terms dated 16th February, 2005 drawn were recorded by learned single Judge (S.K.Shah, J.) on the very same day. i.e. 16th February, 2005. The decree in terms of said consent terms came to be passed, whereby it was, inter alia; agreed that the vendors i.e. defendant Nos.1 to 52 (Vaity family) shall execute conveyance in respect of suit property, in favour of Mrs.Kusum or her nominee. In terms of the said consent terms, deed of conveyance was executed on 25th July, 2005 by defendant Nos.1 to 52 in favour of nominee of Mrs.Kusum - M/s.Oswal Enterprises, Sultan Road, Mumbai. That is how, the dispute between Mrs.Kusum and Vaity family has come to an end. - 9 - However, the Court Receiver is still in possession of the suit property, since possession has not yet been handed over either to Mrs.Kusum or her nominee in terms of consent decree and deed of conveyance. 16. After consent decree in favour of Mrs.Kusum, pursuant to the order of the learned single Judge dated 16th October, 2004, there was again transposition of the parties. Accordingly, respondent No.1 (G.I.C. Society) came to be transposed as plaintiff and, in turn, plaintiff No.2 (Mrs.Kusum) came to be transposed as defendant No.54 in the suit. In view of the subsequent events, now what remains is only a suit between the plaintiff - G.I.C. Society on one hand and defendant - Mrs.Kusum on the other along with M/s.Shreenath Builders, whose stake in the suit is hardly of any consequence. 17. In the light of the above subsequent events having taken place during pendency of the appeal, the appellants herein have now taken out another chamber summons in this appeal being Chamber Summons No.961/2005, to seek amendment to their original Chamber Summons No.1334/2004, praying therein that the appellants herein be impleaded in the suit as defendants instead of co-plaintiffs. The appellants have also prayed for certain interim reliefs mentioned in the Schedule of Amendment appended to the Chamber - 10 - Summons No.961/2005. The respondents in the appeal were given an opportunity to file their counter affidavits, if advised. Accordingly, one of the contesting respondents, Mrs.Kusum has filed her counter affidavit to oppose amendment to the chamber summons. 18. The plaintiff - G.I.C. Society, which is a dominus litis, has given its no-objection for joining the appellants as party defendants to the suit. All the parties to the appeal addressed this Court on merits. The appeal and Chamber Summons No.961/2005 both were heard together and by consent of parties the same are being decided on merits by this common judgment and order. Submissions Submissions Submissions : : : ----------- ----------- ----------- 19. The learned counsel appearing for the appellants submitted that presence of the appellants is absolutely necessary in order to effectually and completely adjudicate upon all the issues between the parties. He further submitted that the appellants were non-suited by the learned single Judge on the main ground that it was not open for the appellants to force themselves as co-plaintiffs in the suit against the desire of the plaintiffs. The impugned reads as under: - 11 - "8. As far as Chamber Summons No.1334 of 2004 is concerned, the same is not maintainable. It is not open to a party to force himself as a Co-Plaintiff. If any authority is required for this proposition, a reference may be made to the case of Mustafa Shareef v. Asif Sharif reported in 1997 Mh.L.J. (NOC)-11 page 7. There is another reason why Chamber Summons No.1324 of 2004 is liable to be dismissed. An identical Chamber Summons bearing No.1040 of 1998 taken out by the Applicant was dismissed by an order dated 15th July, 1999. For the latter reason Chamber Summons no.1325 of 2003 is also liable to be dismissed. The disputes and differences between Plaintiff no.2 and the Applicant in Chamber Summons No.1334 of 2004 are not related to the dispute in the present suit. 20. Learned counsel for the appellants submits that, firstly, the learned single Judge could not have relied upon the decision in the case of Mustafa Mustafa Mustafa Shareef Shareef Shareef (supra) as full text of judgment was not available; secondly, the very same judgment in unequivocal terms lays down that, if a person applying has a stake in the litigation, then it is incumbent on the part of the Court to give him hearing by adding him as defendant. Thus, according to him, the judgment of Mustafa Shareef Mustafa Shareef Mustafa Shareef (supra) was not properly applied. 21. So far as second ground used for rejection of chamber summons is concerned, submission is that Chamber Summons No.1040 of 1998; taken out by the appellants/ applicants was dismissed in default on - 12 - 15th July, 1999. This dismissal order could not have been used to non-suit the appellants. He placed reliance on the provision of order 9 rule 3 of Code of Civil Procedure, 1908 ("C.P.C." for short) to contend that in spite of dismissal of the chamber summons in default it was always open either to move a fresh chamber summons or to apply for an order to set the dismissal aside. That dismissal of chamber summons in default without there being any final adjudication on merits cannot operate as res-judicata. Reliance was placed on the judgment of the Apex Court in the case of Krishan Lal v. State of Jammu & Kashmir Krishan Lal v. State of Jammu & Kashmir Krishan Lal v. State of Jammu & Kashmir, 1994 (1) U.J. (SC) 573 in support of his latter submission. He, thus, submits that the impugned order was erroneous and cannot stand to the scrutiny of law. 22. Learned counsel thus submits that now in the changed scenario of the litigation, G.I.C. Society is the sole plaintiff; they having extended their no-objection for adding present appellants as defendants in the suit, there should no difficulty in allowing the appellants to be impleaded as party defendants in the suit. He submits that Mrs.Kusum (respondent No.55 herein) hardly can have any objection, if the sole plaintiff G.I.C. Society has no objection to add these appellants as defendants. Her objection, if any, has no legs to stand. It should be ignored. - 13 - 23. In order to demonstrate the interest in the suit property, reliance is placed on the deed of partnership dated 8th April 1989 of which existence and execution is not in dispute. Relevant recitals of the said partnership deed read as under: " DEED OF PARTNERSHIP ..... ..... ..... . WHEREAS by an agree development dated 28th day of April , 1980 with the owners of the property situated at C.T.S. No.727, Saojini Naidu Road, Mulund (W), Bombay- 80 has given the possession of same property for the development and SMT.GEETANJALI G. SOHANI is persuation of agreement in actual possession of the said property and started development activities. . AND WHEREAS party of the FIRST PART i.e. SMT.GEETANJALI G. SOHANI approach the party of the SECOND PART i.e. SMT. NEENA ANIL SHAH to join with her in partnership dor the development of the property at C.T.S. No.727 Sarojini Naidu Road, Mulund (W), Bombay 400 080. . WHEREAS PARTY of the FIRST PART i.e SMT. GEETANJALI G. SOHANI brings the property situated at C.T.S.No.727, Sarojini Naidu Road, Mulund (W), Bombay 80 in the partnership business and Smt. NEENA ANIL SHAH will bring the require capital for the purpose of development of property C.T.S.No.727 admisering about 3851.20 sq.mts. . AND WHEREAS the parties here to have decided to carry on business in partnership in the firm name in style of CHITRALEKHA BUILDERS as builders development works, Contractors, Suppliers of Building materials, Real Estate Agents, etc., and accordingly have started the said business in partnership as 8th Day of April 1989. - 14 - . AND WHEREAS THE PARTIES HERETO NOW desirous to record the said terms and conditions into writing and THEREFOR NOW, THIS INDENTURE WITNESSESS as hereinafter recorded. TERMS AND CONDITIONS ..... ..... ..... ..... ..... ..... 8. CAPITAL: The required capital of the partnership business shall be brought by party of the second part i.e. Smt.Nina Anil Shah, However party of the first part is depositing the land as capital by C.T.S.No.727 admeasuring about 3851.20 sq.mts at sarajini Naidu Road Mulund (West) Bombay-400 080. 24. Relying on the aforesaid recitals of the deed of partnership dated 8th April, 1989, the learned counsel for the appellants urged that Mrs.Kusum was in possession of the suit property in part performance of contract. Her possession was referable to section 53A of the Transfer of Property Act. She was, thus, competent to bring the said asset as her capital in the partnership firm. Alternatively, it is submitted that even if the agreement dated 28th April, 1980 is treated to be a development agreement, in that event also it was open for Mrs.Kusum to bring her asset as stock-in-trade forming capital of the partnership firm. In support of this submission reliance is placed on clause-4 of the terms and conditions of the deed of partnership, which reads as under: - 15 - 4. BUSINESS: The business of the partnership shall be as Builders, Developers Contractors, suppliers of Building materials, Real Estate Agent etc. However the parties here to shall be at liberty to carry on any other business as may be agreed upon from time to time. 25. It is thus urged that in either of the situations by virtue of section 14 of the Partnership Act, all the assets with the aid of which the business was carried on by the original proprietor of M/s.Chitralekha Builders (proprietary firm) must be deemed in law to have become the asset of the partnership firm. He, thus, submits that the appellants have direct interest in the suit property. The interest of the appellants in the suit property was sufficient for them to claim impleadment as party to the suit as such the learned single Judge ought to have allowed their chamber summons. Now the submission is that, at any rate, at least, at this stage, they should be allowed to be party to the suit to protect their interest in the suit property. 26. In the submission of the learned counsel for the appellants, even in the present changed scenario the present appellants are necessary parties to the suit; may be as defendants, because plaintiff - G.I.C. Society is now enforcing its right against the property which, according to him, is the property of - 16 - the partnership firm in which the present appellants have interest in the capacity of partners. According to him, nominee of Mrs.Kusum cannot claim any interest in the suit property because the transaction would be hit by section 19 of the Partnership Act. Alternatively, it is submitted that, at the most, nominee of Mrs.Kusum could be said to have entered into the shoes of Mrs.Kusum. Any act of Mrs.Kusum, however, cannot affect interests of other partners. It is, thus, urged that to protect the interest of the partnership ;firm and its property the appellants should be made parties to the suit either by allowing the chamber summons or in exercise of discretionary power of the Court vested under order 1 rule 10 of C.P.C. 27. Learned counsel for the appellants further submits that one of the questions in the suit would be whether the plaintiff - G.I.C. Society is entitled to claim specific performance of the agreement or, in alternative, are they only entitled to claim damages. In the event suit is decided in favour of the plaintiff - G.I.C. Society, then the ultimate sufferer would be either the partnership firm or its partners as such their immovable property is at stake. In the event of monetary decree for damages, the same would be the liability of the partnership firm and its partners. He, thus, submits that considering the - 17 - matter from any angle, the appellants ought to have been and ought to be joined as parties to the suit. At any rate, even in the changed circumstances, their presence before the Court for effective and complete adjudication of all the questions is necessary. The appellants, thus, prayed that their chamber summons seeking amendment to their original chamber summons be allowed and they be added as party-defendants in the suit by allowing their appeal. Per Per Per Contra : Contra : Contra : ---------- ---------- ---------- 28. The learned counsel appearing for respondent No.1 - G.I.C. Society submitted that the society has no objection to permit amendment to the chamber summons moved by the appellants vide Chamber Summons No.961/2005 and further it has no objection for Mrs.Neena A. Shah being added as party defendant to the suit along with the partnership firm as per chamber summons. In support of this submission, plaintiff - G.I.C. Society has also filed on record its affidavit dated 25th July, 2005. 29. Learned counsel appearing for the contesting respondent No.55 - Mrs.Kusum tried to support the impugned order. He contends that the Chamber Summons No.961/2005 and the prayers made therein are mala fide. The intention is to make false claim upon the - 18 - property in which the appellants have no interest at all. It is further urged that the appellant - Mrs.Neena A. Shah herself has dissolved the partnership vide her letter dated 18th July, 1989, consequently, the firm is not in existence with effect from 18th July, 2005. That pursuant to the dissolution, the appellants have invoked arbitration clause and Justice A.A.Agarwal (Retd.) has been appointed as an Arbitrator vide order of this Court dated 22nd July, 2005 passed in exercise of the power under the provisions of section 11 of the Arbitration and Conciliation Act, 1996 to resolve the alleged disputes between the appellants and respondent No.54 as such their presence in the suit is not necessary. 30. It is further urged that Mrs.Kusum had filed suit in her personal capacity as proprietress of M/s.Chitralekha Builders. She had never brought her asset in the partnership firm as such appellants have no right to claim any interest in the suit property. That, at any rate, the partnership agreement was nothing but a financial arrangement between the parties to the agreement. That pursuant to the consent decree, Mr.Kusum having become the owner of the suit plot was entitled to deal with the same in absence of any prohibitory order operating against her. The appellants having not filed any appeal against the consent decree dated 16th February, 2005, - 19 - one has to presume that they have accepted Mrs.Kusum as an owner of the suit property. That Mrs.Kusum has executed deed of conveyance in favour of M/s.Oswal Enterprises and, in that view of the matter, the suit property cannot be said to be the property of the partnership. That the appellants cannot have any legal interest in the subject matter of the suit as such they are not entitled to participate in the suit. It is, thus, urged that the appellants are not entitled to claim impleadment as defendant Nos.54 and 55 in the suit. Mrs.Kusum asserted her sole right to defend the suit. In conclusion, learned counsel appearing for Mrs.Kusum urged that the appeal be dismissed as infructuous holding it to be without any merit. Rejoinder Rejoinder Rejoinder : : : --------- --------- --------- 31. In rejoinder, without prejudice to the earlier submissions, learned counsel for the appellants urged that whether the firm itself has been dissolved or not is a question which can be decided by the competent Court during the trial of the suit. That may be one of the issues to be tried. He, however, urged that the partnership firm is not a legal entity distinct from its members. Therefore, the decree that may be passed against the firm under order 30 would be the decree against each member