1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELATE JURISDICTION WRIT PETITION NO.1699 OF 2008 Maharashtra State Electricity Distribution Company Limited ...Petitioner vs. Appa Annaapa Gavarai ...Respondent Mr.G.S.Kulkarni a/w Mr.S.K.Chari i/b M/s.M.V.Kini & Company for the petitioner Mr.U.P.Warunjikar for the respondent CORAM :A.S.OKA,J. DATE : MARCH 8, 2010 P.C.: 1 By order dated 17 th March 2008 this Court directed that the petition shall be disposed of finally at the stage of admission. The petitioner has taken an exception to the Judgment and Order dated 30 th November 2007 passed by the learned District Judge by which the application made by the petitioner at Exhibit-24 has been rejected. 2 With a view to appreciate the submissions made by the learned counsel for the parties, it will be necessary to consider the facts of the case in brief. A suit was filed by the Executive Engineer, Maharashtra State Electricity Board (hereinafter referred to as the said Board) against the respondent for recovery of money. The suit was contested by the respondent. One of the contentions raised in the written statement was that the suit was not competent as the Executive Engineer who has purported to file the suit was not competent to file the suit on behalf of the said Board. On the basis of the said contention, issues were framed by the trial Court. The trial Court answered the issue as regards maintainability of the suit in favour of the original 2 plaintiff. The suit was decreed by the trial Court. An appeal was preferred by the respondent before the District Court. Initially, appeal was allowed ex-parte. The appeal has been subsequently restored. 3 An Application at Exhibit-24 was made by the present petitioner. It was contended that Maharashtra State Electricity Board was divided into four different companies which have been registered under the Companies Act,1956. One of the four companies is the petitioner- company. A prayer in the application was for permitting the original plaintiff to be substituted by the petitioner-company. A prayer was also made for adding an averment that as per  the delegation of financial powers G.O.2 (S & 5) of 18 th February 1965 , prior to 18 th February 2006, executive engineer was empowered to file a suit on behalf of the Board. By the impugned order, the said application has been rejected by the Appellate Court. 4 The learned counsel for the petitioner invited my attention to the findings recorded by the Appellate Court in the impugned order. He submitted that in view of Maharashtra Electricity Reforms Transfer Scheme, 2005, the undertaking of the Maharashtra State Electricity Board stands transferred in favour of the petitioner- company and therefore, the prayer for substitution ought to have been allowed. 5 The contention of the learned counsel for the respondent is based on the consistent stand taken before the trial Court as regards the maintainability of the suit filed by the Executive Engineer. He submitted that not only in the written statement, but even during the course of hearing of the suit repeatedly a contention was 3 raised by the respondent that the suit was not maintainable. He submitted that the appeal preferred by the respondent was earlier allowed on 17 th August 2006 by holding that the suit at the instance of the executive Engineer was not maintainable. Thereafter, the said decree was set aside. Even thereafter no steps were taken for correcting the error and the present application has been filed belatedly on 27 th October 2007. Considering this conduct, he submitted that no interference is called for in writ jurisdiction. He submitted that the suit is filed in the year 2001 and therefore, the inherent defect in the plaint cannot be permitted to be corrected in the year 2007 in the Appeal. 6 I have given careful consideration to the submissions. The first amendment is sought for substituting original plaintiff by the present petitioner. As stated earlier, the original plaintiff was the Executive Engineer of the Maharashtra State Electricity Board. Reliance has been placed on the subsequent event of formation of four different companies which were registered under the Companies Act,1956. A reliance has been placed on Maharashtra Electricity Reforms Transfer Scheme, 2005 framed by the Government of Maharashtra in exercise of power under sections 131, 133 and 134 of the Electricity Act,2003. The scheme was framed as a result of the formation of the four different companies for the purpose of giving effect to the transfer of properties, interest, rights, liabilities, obligations, proceeding and personnel of the Maharashtra State Electricity Board to the transferees and for the matters incidental and ancillary thereto. Reliance is placed on the clause (8) of the said scheme which provided that all proceedings of whatsoever nature by or against the said Board pending on the date of transfer 4 shall not abate or discontinue or otherwise in any way prejudicially affected by reason of the transfer under this scheme. It is further provided in clause (8) of the scheme that the proceedings shall be continued, prosecuted and enforced by or against the Transferee to whom the same are assigned in accordance with this scheme under the scheme assignment is placed against the petitioner. 7 What is invoked by the petitioner is essentially the power under Rule 10 read with rule 11 of Order XXII and Rule 10(2) of the Order I of the Code of Civil Procedure, 1908 (hereinafter referred to as the said Code). Section 21 of the Limitation Act,1963 reads thus : 21. Effect of substituting or adding new plaintiff or defendant  (1) Where after the institution of a suit, a new plaintiff or defendant is substituted or added, the suit shall, as regards him, be deemed to have been instituted when he was so made a party; Provided that where the Court is satisfied that the omission to include a new plaintiff or defendant was due to a mistake made in good faith it may direct that the suit as regards such plaintiff or defendant shall be deemed to have been instituted on any earlier date. (2) Nothing in sub-section (1) shall apply to a case where a party is added or substituted owing to assignment or devolution of any interest during the pendency of a suit or where 5 a plaintiff is made a defendant or a defendant is made a plaintiff. In view of sub section 1 of section 21 of the when a new plaintiff is substituted or added, the suit as regards the said substituted plaintiff shall be deemed to have been instituted when he was so made a party. However, sub section (1) of section 21 is not applicable when the substitution is as a result of transfer or devolution of interest during the pendency of the proceedings. In the present case, sub-section (1) of section 21 will not apply as the substitution is claimed on the basis of the transfer of right, title and interest of the said Board in favour of the petitioner under the said scheme. It is obvious that after the said scheme came into force, the Board will not be in a position to prosecute the suit or defend the pending appeal. Even if the substitution is permitted, the same will not have the effect of curing the defect in the suit, if any, at the time of institution of the suit. 8 The learned District Judge while dealing with the said application has observed that the petitioner-company has come into existence when the suit was pending and that a specific objection to the institution of the suit by the Executive Engineer has been taken. Even if substitution is permitted, the issues as regards the alleged defect in the suit and limitation will always remain open. Moreover, the effect of the substitution on the alleged defect at the time of institution of the suit will have to be considered by the Appellate Court while deciding the appeal. The other amendment sought is for relying upon the delegation of powers by the said Board to its Executive Engineers. There was no ground to deny the relief claimed in application at Exhibit-24. 6 Application ought to have been allowed by the Appellate Court However, considering the delay on the part of the petitioner, the Appellate Court ought to have imposed costs. The amount of costs is quantified at Rs.7500/-. 9 Hence, I pass the following order : i) Impugned order dated 30 th November 2007 is quashed and set aside. The application at Exhibit-24 is allowed subject to the petitioner paying costs of Rs.7,500/- to the respondent within a period of eight weeks from today. Payment of costs will be a condition precedent. ii)It is made clear that the issues regarding limitation as well as the effect of substitution of on the alleged defect in the suit at the time of institution thereof are expressly kept open. iii)It will be open for the respondent to raise all permissible contentions by filing additional written statement to the amended plaint. iv)Amendment to be carried out within a period of two weeks from the date on which writ of this order is received by the Appellate Court. v) Additional written statement shall be filed by the respondent within a period of eight weeks from the date on which a copy of amended plaint is served to him. vi)Writ Petition is allowed in above terms. JUDGE