- 1 - IN THE HIGH COURT OF JUDICATURE AT BOMBAY O.O.C.J. APPEAL NO.569 OF 2001 IN SUIT NO.3433 OF 1997 ... S.S.Jhuria & ors. ...Appellants v/s. Union of India & ors. ...Respondents ... Mr.H.J.Thakkar, Sr.Counsel i/b Bhai Shankar Kanga & Girdharlal for the Appellants. Mr.S.R.Rajguru for the Respondents Nos.1 to 3. Mr.K.R.Bulchandani i/b Zohair & co. for Respondent No.4. Mr.S.N.Shah with Mr.L.S.Jain for Respondent No.5. ... - 2 - CORAM: D.K.DESHMUKH & J.H.BHATIA, JJ. DATED: 24TH OCTOBER, 2007 P.C.: 1. By this Appeal the Appellants who are original Plaintiffs challenge the judgment and order dated 30th March, 2001 passed by the learned single Judge of this Court in Suit No.3433 of 1997. By that judgment the learned single Judge has decided only the preliminary issue and has disposed of the suit. . At the outset, the learned Counsel appearing for the Appellants stated before us that the Appellants do not claim any reliefs against Defendants Nos.1,2 & 3 and they sought leave of the court to delete allegations made against Defendants Nos.1, 2 & 3 as also prayers by which reliefs are claimed by the Plaintiffs against Defendants Nos.1, 2 & 3. 2. According to the averments in the plaint, the - 3 - Plaintiffs are the trustees and beneficiaries under a Declaration of Trust dated 1st April 1951 made by one Kanhaiyalal J. Poddar, who was the grandfather of the Plaintiffs Nos. 1 & 2 and the Defendant No.4 and he was also a great grandfather of Plaintiff No.3. Plaintiff No.3 was appointed as a trustee of the said trust by registered Deed of Appointment dated 10-4-1996. Defendant No.5 is the wife of the Defendant No.4. Defendant No.1 is the Union of India and Defendants Nos. 2 & 3 are the officers of the Union of India. According to plaint, by declaration of Trust dated 1st April, 1951 executed by the said Mr.Kanhaiyalal J. Poddar an amount of Rs.2 lakh was declared as a Trust Fund for the benefits of the members of the family of the son of the said Mr.Kanhaiyalal J. Poddar. The name of the son was Ram Niwas K. Poddar. The said Kanhaiyalal Poddar appointed himself as the trustee of the said trust. One Ajay Singh Randhir Singh was appointed as additional trustee of the Trust by Kanhaiyalal J. Poddar. One Deviprasad Khandelwal had by an agreement dated 2-7-1942 acquired the right to grant of lease by Bombay Municipal Corporation of a plot of land being plot No.6, Worli Estate, Scheme No.52 at Abdul Gaffar Khan Road, Worli, Bombay for a period of - 4 - 999 years. The said Deviprasad Khandelwal entered into an agreement dated 29-2-1956 agreeing to transfer and convey all his rights under that agreement in favour of one of the trustees of the trust by name Mr.Ajaysingh Randhir Singh. On payment of full consideration to the said Khandelwal, he executed irrecoverable power of attorney in favour of Mr.Ajaysingh Randhir Singh and Mr.Ramniwas K. Poddar. The Bombay Municipal Corporation executed the Indenture of Lease dated 19-2-1964 with the said Mr.Ajaysingh Randhirsingh as confirming party of the said land with structure thereon in favour of one Smt.Shantidevi S. Juria, the Plaintiff No.1, Smt.Shakuntala Devi S. Kayal, Plaintiff No.2, Shri D.R.Poddar, Defendant No.4 and Smt.Uma D. Poddar, Defendant No.5. The said lease was for a period of 999 years from 14th July, 1942. The consideration for the lease i.e. Rs.25,000/- was paid from the Trust Fund of Rs.2,00,000/-. According to the Plaintiffs, before the lease of the land was granted by the Corporation in the year 1964, Mr.Ramniwas Poddar had appointed four persons, in whose favour the lease was executed, as trustees of the said Trust. Defendants Nos. 4 & 5, however, declined to act as Trustees. They also disowned their signatures - 5 - on the lease deed. According to the Plaintiffs, the aforesaid land and the structure thereon is the property of the Trust of which they are the trustees. The title of the Trust to the property, according to the Plaintiffs, was disputed by Defendants Nos.4 & 5, and therefore, Defendants Nos.4 & 5 were joined as parties. According to the Plaintiffs, the authorities to the Income-tax Department were also treating the property as belonging to the said Poddars and not to the trust and therefore, these authorities were also joined as parties. 3. The principal relief claimed in the suit was a decree of declaration that the above referred property is the property owned by the Trust and the permanent injunction consequent upon the declaration is also claimed in the plaint. 4. The suit was resisted by all the Defendants. On the basis of rival pleadings, the learned single Judge framed nine issues. The issues framed by the learned single Judge read as under:- ISSUES - 6 - 1. Whether the Plaintiffs prove that the suit property belongs to the Trust dated 1-4-1951 settled by late Kanhaiyalal J. Poddar? 2. Whether the Plaintiffs prove that Defendants Nos.4 and 5 are not co-lessees of the suit property in respect of the lease deed to the contrary? 3. Whether Defendants Nos.1 to 3 are liable to render accounts of the amounts collected by them from the suit property? 4. What order and decree against Defendants Nos. 1 to 3? 5. Whether the suit is barred by law of limitation as alleged in para 2 of the written statement of Defendant No.4? 6. Whether the plaint is liable to be rejected as alleged in para 1 of the written statement of Defendant No.4? - 7 - 7. Whether the suit is barred by res-judicata or principles analogous thereto as alleged in para 2 of the written statement of Defendant No.4? 8. Whether the suit is bad for non joinder or misjoinder or parties or for multifariousness as alleged in para 2 of the written statement of Defendant No.4? 9. What order and decree against Defendants Nos.4 to 5? By order dated 6-2-2001 while framing the issues, the learned single Judge directed that out of nine issues framed by him, issues Nos.5,6,7 and 8 would be treated as preliminary issues. Relevant portion of the order reads as under: Issues Nos.5,6,7 and 8 are to be treated as preliminary issues. Parties to file affidavits of documents and exchange inspection before next date. - 8 - For hearing preliminary issues suit is fixed on 13-2-2001. The learned single Judge pursuant to his order dated 6-2-2001 decided the preliminary issues by his order dated 30th March, 2001. The learned single Judge answered Issue No.5 in the affirmative and held that the suit is barred by the law of limitation. The learned single Judge answered issue No.6 in the negative and held that the plaint is not liable to be rejected. The learned single Judge has answered Issue No.7 also in the negative and held that the suit is not barred by the principle of res-judicata. The learned single Judge answered Issue No.8 in the affirmative and held that the suit is bad for non-joinder of necessary parties. The learned single Judge also framed Issue No.8A and answered the same in the negative holding that the suit is not barred in view of the provisions of Section 293 of the Income-tax Act. In view of the answers given in relation to issue Nos.5 & 8, the learned single Judge held that the suit is liable to be dismissed and dismissed the suit. The learned single Judge, thus, found that the suit is barred by the law of limitation and is also liable to be dismissed for - 9 - non-joinder of necessary parties. The present Appeal is directed against this order of the learned single Judge. 5. The learned Counsel appearing for the Appellants submits that the learned single Judge has dismissed the suit by trying the issue of limitation as a preliminary issue. The learned Counsel submits that the issue of limitation is never an issue of pure question of law, it is a mixed question of law and fact and therefore, the learned single Judge had no jurisdiction to try that issue as a preliminary issue in view of the provisions of Order XIV Rule 2 of the Civil Procedure Code. The learned Counsel relies on a judgment of the Supreme Court in the case of Ramesh B. Desai & ors. v/s. Bipin Vadilal Mehta & ors., 2006(6) All MR (S.C.) 56. The learned Counsel further submits that the learned single Judge has decided the issue of limitation as a preliminary issue without requiring the parties to lead any oral evidence. According to the learned Counsel following such course of action was not open to the learned single Judge, even if it is assumed that the parties declined to lead oral evidence in view of the judgment of the Supreme Court in the case of - 10 - Gunwantbhai Mulchand Shah v/s. Anton Elis Farel, AIR 2006 SC 1556. The learned Counsel further submits that the Plaintiffs also desire to amend their plaint. They have submitted an application for amendment in the plaint. The learned Counsel submits that this court should permit the Plaintiffs to amend the pleadings. The learned Counsel further submits that the finding recorded by the learned single Judge on issue No.8 that the suit is bad for non-joinder of necessary parties also suffers from non-application of mind. The learned single Judge has held that the suit is bad for non-joinder of necessary parties, because according to him all trustees have not been joined as parties. The learned Counsel submits that this finding is contrary to the record. 6. The learned Counsel appearing for the Defendant No.4 submits that the learned single Judge tried only the preliminary issue with the consent of the parties and therefore the Appellants cannot take exception to the order of the learned single Judge directing the trial of certain issues as preliminary issues. It is submitted that the Plaintiffs themselves declined to lead any oral evidence in support of their case and therefore, the learned single Judge was justified in - 11 - deciding the issue of limitation as a preliminary issue. The learned Counsel submits that perusal of the plaint itself shows that the suit is clearly barred by the law of limitation. The learned Counsel also opposed the application made for amendment in the plaint. He submits that according to amended provisions of Order VI Rule 17 of CPC, an application for amendment in the plaint, after the trial has commenced, can be allowed only in one contingency namely that the facts which are to be brought on record by amendment were not within the knowledge of the Plaintiffs even after due diligence. 7. The learned Counsel appearing for the Defendant No.5, on the other hand, submits that the plaint does not disclose the date on which the cause of action arose. For that purpose he relies on the provisions of Order VII Rule 1. According to the learned Counsel, the learned single Judge was perfectly justified in dismissing the suit as barred by law of limitation. According to him, in any case, the suit is liable to be dismissed, because it does not disclose as to when the cause of action accrued to the Plaintiffs. The learned Counsel also read from the judgment of the learned single Judge to show that - 12 - it was the case of the Plaintiffs themselves that the suit is not really for a decree of declaration, but only for lifting of attachment levied by Defendants Nos.1, 2 & 3. 8. Now, first taking up the finding recorded by the learned single Judge on Issue No.8 for consideration, the learned single Judge has held that the suit for protection of the trust property has to be filed by all the trustees of the Trust. The learned single Judge also observed that it was not disputed before him that when the suit is filed on behalf of the Trust, all the trustees must be joined as parties. The learned single Judge says that in the plaint, however, there is no statement made that all the trustees have been joined as parties to the suit and therefore, according to him the suit is bad for non-joinder of necessary parties. 9. Reading of Issue No.8 which has been decided by the learned single Judge by holding that the suit is bad for non-joinder of necessary parties shows that the issue was framed on the basis of statement made in paragraph 2 of the Written statement of the Defendant No.4. Perusal of paragraph 2 of the - 13 - written statement of Defendant No.4 shows that only relevant averment is to be found in paragraph 2(c). It reads as under:- That the suit is bad for non-joinder of necessary or proper parties in as much as all the beneficiaries under the Deed of Trust are not made parties to the suit. The Trustees representing the deity installed in the family temple at Mathura are not made parties to the suit. The said deity is 1/4th beneficiary under the said Trust. Annexed hereto and marked Exhibit "1" is a list of the trustees representing the deity. Perusal of this paragraph shows that it is not the objection that all the trustees of the Trust for whose benefit decree of declaration is claimed are not joined as parties to the suit. The allegation is that all the beneficiaries under the deed of Trust are not joined as parties to the suit. It is further claimed that the deity installed in the temple at Mathura is one of the beneficiary and that the deity is represented by trustees whose names are given in Exhibit "1" to the written statement. Thus, it is - 14 - not the objection raised by Defendant No.4 that all trustees of the Trust for whose benefits the decree of declaration is sought are not joined as parties. Therefore, the answer given by the learned single Judge in paragraph 15 to issue No.8 is totally irrelevant because that was not the objection raised by the Defendant No.4 and that was not the issue. The objection of the Defendant No.4 was that beneficiaries should have been joined as parties and that objection as is clear from paragraph 15 of the judgment has not been decided by the learned single Judge. Thus, answer given to issue No.8 suffers from non-application of mind, and therefore is liable to be set aside. 10. Now, so far as answer given to Issue No.5 is concerned, Issue No.5 was framed on the basis of allegations contained in paragraph 2 of the Written statement of the Defendant No.4. Perusal of paragraph 2 of the written statement of Defendant No.4 shows that it is paragraph 2(a) which is relevant. It reads as under:- (a) That the suit is barred by the law of limitation as it is filed beyond the period - 15 - prescribed by law of limitation as the- (i) reliefs against this Defendant and his wife for permanent injunction from claiming as tenants in common under the Indenture of lease is time barred, in as much as this Defendant claimed as tenant-in-common way back in 1982. Similarly the relief for permanent injunction against this Defendant to claim the property as owner is also time barred as he had claimed the property as the owner way back in 1969 which this Defendant subsequently gave up; (ii) The monetary claim against this Defendant is also time barred, for which the period of limitation is 3 years. 11. The objection of the Defendant No.4 thus was that the suit in so far as it claims permanent injunction against Defendants Nos.4 & 5 is barred by the law of limitation, as Defendant No.4 claimed to be the tenant in common wayback in 1982. It is further claimed that suit for permanent injunction against the Defendant No.4 to claim the property as owner is time barred as he had claimed the property - 16 - as owner way back in 1969. But that stand was subsequently given up. It was also claimed that the monetary claim is also barred by the law of limitation. 12. Now, at this juncture, if one peruses the prayer clauses of the suit, it shows firstly that there is no monetary claim made against Defendant No.4. Therefore, there is no question of any monetary claim made against the Defendant No.4 being barred by the law of limitation. In the plaint following reliefs are claimed: (a) That this Hon’ble Court may be pleased to declare that the suit property being plot No.6, Worli Estate Scheme No.52, Abdul Gaffar Khan Road, Worli Sea Face, Bombay with the building constructed thereon and more particularly described in Schedule Exhibit-"A" hereto belongs to the trust declared under the Declaration of Trust dated 1st April 1951 made by Kanhaiyalal J. Poddar. (b) That the defendants Nos.1 and 2 be - 17 - decreed and ordered to pay to the plaintiffs Rs.2.25 lacs as per particulars of claim Exhibit "A-1" hereto annexed together with interest @ 24% p.a. on the annual collections from 1st day of January of every succeeding year till 31st December, 1996. (c) That the defendants Nos. 1 to 3 be directed to disclose the amounts collected by them and a decree for the total amount together with interests at the rate of @ 24% p.a. on the amount and on the collections from 1st day of January of every succeeding year till 31st December, 1996 be passed. (d) That the defendants Nos. 1 to 3 by themselves their servants and agents be restrained by an order of permanent injunction of this Hon’ble Court from asserting any title adverse to the said Trust to the said property or initiating or continuing any assessment proceedings on the footing that the said property - 18 - belongs to the estate of Ramniwas K. Poddar or from recovering any taxes, duties or dues of Ramniwas K. Poddar or his estate from the said property. (e) That the defendant No.4 and 5 by themselves their servants and agents be restrained by an order of permanent injunction of this Hon’ble Court from claiming as tenants in common of the said property or the land and building comprised therein or any part thereof. (f) That the Defendant No.4 be restrained by an Order of permanent injunction of this Hon’ble Court from claiming any part of the property to be belonging to him as owner thereof. 13. So far as relief of permanent injunction is concerned, by prayer clause (e) permanent injunction is claimed against Defendants Nos.4 & 5 restraining them from claiming to be the tenant in common of the suit property and by prayer clause (f) a permanent - 19 - injunction is claimed against Defendant No.4 restraining him from claiming to be the owner of any part of the property. From the statement made in paragraph 2(a) of the written statement of Defendant No.4, it is clear that though the Defendant No.4 was claiming that relief claim by prayer clause (f) against him is barred by law of limitation, because he had claimed to be the owner of the property in 1969, but at the same time he stated that subsequently he has given up that plea. Therefore, it will be safe to deduce from this that so far as prayer clause (f) is concerned, Defendant No.4 was not claiming that it is barred by the law of limitation. So far as relief claimed by prayer clause (e) is concerned, the case of Defendant No.4 was that he had claimed to be tenant in common in 1982 and therefore the suit filed in the year 1997 was barred by the law of limitation. Perusal of prayer clause of the plaint shows that the Plaintiffs were also claiming by prayer clause (a) a decree of declaration that the Trust is the owner of the property. So far as that prayer is concerned, the Defendant No.4 was not claiming that the relief for a decree of declaration is barred by law of limitation. Thus, the case of the Defendant No.4 was that only - 20 - relief claimed by prayer clause (e) for permanent injunction is barred by the law of limitation because he has claimed to be the tenant in common in 1982. Issue No.5 has been framed because of averments made in the written statement of the Defendant No.4 and it is clear from those averments that the Defendant No.4 is claiming that only the relief claimed by the prayer clause (e) is barred by the law of limitation and not the entire suit, but on the basis of the finding recorded on this issue the learned single Judge has held that the entire suit is barred by the law of limitation. The issue No.5 framed on the basis of these pleadings cannot be said to be purely an issue of law, at best it can be said that it is a mixed issue of fact and law. Perusal of the order dated 6-2-2001 passed by the learned single Judge shows that it is by that order that the learned single Judge framed the issues and at the same time directed that he will treat issues Nos.5, 6, 7 & 8 as preliminary issues. Thus, it is by order dated 6-2-2001 that the learned single Judge directed trial of issue No.5 as a preliminary issue and decided it by order dated 30th March, 2001. At this juncture, in view of the submissions made by the parties it becomes necessary to look at the provisions of Order - 21 - XIV Rule 2 of CPC, which have been considered by the Supreme Court in its judgment in the case of Ramesh B. Desai. Rule 2 of Order XIV reads as under:- Court to pronounce judgment on all issues.- (1) Notwithstanding that a case may be disposed of on a preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues. (2) Where issues both of law and of fact arise in the same suit, and the Court is of opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to- (a)the jurisdiction of the Court, or (b) a bar to the suit created by any law for the time being in force, and for that purpose may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with - 22 - the decision on that issues. 14. Perusal of the above provisions shows that it lays down that where issues of both of law and of fact arise in the same suit and the court is of the opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to the jurisdiction of the Court or a bar to the suit created by any law for the time being in force. The above quoted provisions has been considered by the Supreme Court in its judgment in the case of Ramesh B. Desai (supra). The observations of the Supreme Court found in paragraph 12 of that judgment are relevant. They read as under:- 12. Sub-rule (2) of Order XIV, Rule 2 CPC lays down that where issues both of law and of fact arise in the same suit, and the Court is of opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to (a) the jurisdiction of the Court, or (b) a bar to the suit created by any law for the - 23 - time being in force. The provisions of this Rule came up for consideration before