1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION NOTICE OF MOTION NO.467 OF 2007 IN SUIT NO.3537 OF 2004 Quadricon Pvt.Ltd. ....Plaintiff Versus Shri Bajrang Alloys Ltd. ....Defendant Mr.Zal T. Andhyarujina with Mr.H. S. Jain i/b Thakoredas & Madgavkar for the Plaintiff. Mr.M. S. Doctor with Mr.Darshan Mehta i/b M/s.Dhrue Liladhar & Co. for the Defendant. CORAM : S.J. VAZIFDAR, J. DATE : 12TH DECEMBER, 2007. ORAL JUDGMENT : 1. This is the Plaintiff's application for leave under clause 12 of the Letters Patent. 2. The questions that arise in this case fall into two categories. The first is whether leave under clause 12 of the Letters Patent can be granted after the plaint is not only presented under rule 1 of Order IV but is also admitted and entered in the register under rule 2 of that 2 Order of the Code of Civil Procedure, 1908. The second is whether the Plaintiff is entitled to leave under clause 12 even assuming the first question is answered in the affirmative. I have answered the first question in the negative and the second in the affirmative. FACTS 3(A). It is admitted that the plaint was presented on 29.9.2004 that it was admitted on 10.12.2004 without leave having been sought or obtained. (B)(i). The Defendant took out Notice of Motion No.745 of 2005 raising a preliminary issue of jurisdiction under Section 9(A) of the Code of Civil Procedure, 1908 and for a declaration that this Court does not have jurisdiction to try the present suit and consequently for an order that the plaint be returned under order VII Rule 10 of the CPC. (ii). The Plaintiff filed an affidavit in reply dated 27.3.2006. In paragraph 15, the Plaintiff stated that it intended applying for leave under clause 12 of the Letters Patent which it did on 27.3.2006. (iii). By an order dated 26.4.2006 in Notice of Motion No.745 of 2005, D.K. Deshmukh, J. recorded that the Defendant did not press 3 prayer clause (a) of Notice of Motion wherein the Plaintiff sought the decision of this Court under Section 9(A) of the CPC on the preliminary issue as to jurisdiction. The learned Judge held that there was no power to grant an interim decree of declaration and that therefore there was no question of granting the other prayer for the return of the plaint. The learned Judge held that the plaint could be returned only on the application of the Plaintiff and not on the application of the Defendant. The learned Judge therefore dismissed the Notice of Motion. (C). The Defendant filed Appeal No.896 of 2006 against the said order dated 26.4.2004. The Appeal was disposed of by an order dated 13.12.2006. The Division Bench while dismissing the Appeal held that it was open to the Defendant to make an application for rejection of the plaint under Order VII Rule 11 of CPC and that if such an application is made, it would be considered uninfluenced by the order dated 26.4.2004. (D). In the circumstances, the Defendant took out Notice of Motion No.467 of 2007 for an order rejecting the plaint under Order VII Rule 11 of the CPC. 4 4. This order is restricted to the Plaintiff's application for leave under clause 12 of the Letters Patent. 5. Mr.Doctor submitted that leave cannot be granted under clause 12 of the Letters Patent at this stage. He further submitted that leave under clause 12 in any event ought not to be granted as no part of the cause of action had arisen within the jurisdiction of this Court. 6. Admittedly, the suit was presented/lodged on 29.9.2004 and the plaint was admitted on 10.12.2004. The leave under clause 12 of the Letters Patent was not sought either before the plaint was presented or before it was admitted. WHETHER LEAVE UNDER CLAUSE 12 OF THE LETTERS PATENT CAN BE GRANTED AFTER A PLAINT IS ADMITTED AND ENTERED IN THE REGISTER OF CIVIL SUITS 7. I must express my appreciation for the thorough research and well presented submissions by both Mr.Andhyarujina and Mr.Doctor. I did at one stage during the arguments think that it was open to me to answer the first question on principle on a line of reasoning I will refer to later. However, having considered again all 5 the authorities upon reserving the judgment, I find that it is not open to me to decide the matter on principle. I find myself bound by the judgments of this Court and it is on this basis that I must answer the question. 8. The judgment in Bai Amrit, ILR (1884) 8, Bom.380, is not of any assistance while deciding the question before me. The question was neither raised nor decided in the judgment. 9. In Rampurtab Samruthroy v. Premsukh Chandamal, ILR, (1890) 15, Bom.93, the Plaintiff who had earlier obtained the leave under clause 12 of the Letters Patent applied for an amendment. Telang, J. held that granting the amendment would be permitting the Plaintiff to obtain an adjudication upon a cause of action different from that for which leave of the Court had been obtained and one which must be substantiated by very different evidence, and which must involve an investigation of an entirely different character. The learned Judge further held :- “I consider that such a proceeding is not sanctioned by law. In Shaikh 1 Ind.Jur. (N.S.), 218.) Abdool Hamed v. Promothonath Bose, Phear, J., decided in Calcutta that the leave required by clause XII of the Letters Patent must be granted, if at all, at the time of the acceptance 6 of the plaint, and cannot be granted afterwards. And this view, which is entirely in consonance with the express words of clause XII, has, I believe, been always accepted in this Court.” (emphasis supplied.) It is clearly held therefore that leave under clause XII cannot be granted after the plaint is accepted. 10. A Division Bench of this Court in Devidatt v. Shriram, 30(4) BLR, 236 affirmed the judgment in Rampurtab's case and held as follows :- “Clause 12 of the Letters Patent defines the limits of the original jurisdiction of this Court and reading the clause, apart from authority,it seems to me clear that in a case in which the cause of action has arisen in part only within the local limits of the original jurisdiction, it is a condition precedent to the maintenance of the suit that the leave of the Court should have been first obtained. The condition of obtaining leave is an essential qualification of the suit. This, I think,has been the general view of High Courts in India, see e.g., the judgments of Sir Richard Couch in Hadjee Ismail Hadee Hubbeed v. Hadjee Mahomed Hadjee Joosub, of Sir Basil Scott in Abdul Kadir v. Doolanbibi, of Mr.Justice Telang in Rampurtab Samruthroy v. Premsukh Chandamal and of a special bench of the Calcutta High court in Laliteshwar Singh v. Rameshwar Singh. ................................................................................. In my judgment the words of cl. 12 of the letters 7 Patent are quite clear and make the obtaining of leave a condition precedent to the entertainment by this Court of a suit in which the cause of action arises in part outside the jurisdiction, and the condition is not one which it is competent for a Court to ignore or for the parties to `waive'. The question then is whether the granting of leave under cl. 12 is a condition precedent going to the root of the jurisdiction of the Court or a mere matter of procedure capable of being waived by conduct or agreement of the parties. Clause 12 of the Letters Patent provides that the High Court of judicature at Bombay in the exercise of its ordinary original civil jurisdiction shall be empowered to receive, try and determine suits of every description, if in the case of suits for land (omitting unnecessary words) the land is situate, or in all other cases, if the cause of action shall have arisen either wholly, or in case the leave of the Court shall have been first obtained, in part, within the local limits of the ordinary original civil jurisdiction of the High Court. The rest of the clause is not material. The words “empowered to receive” seem to me to be important and the meaning is that the Court on the ordinary original civil jurisdiction has no jurisdiction even to receive a plaint where a part of the cause of action only shall have arisen within the local limits of its jurisdiction unless leave of the Court shall have been first obtained.” 11(A). In Ramgopal Chunilal v. Ramsarup Baldevdas, 36, BLR, page 84, the Division Bench distinguished between the two stages contemplated under rules 1 and 2 of Order IV of the CPC while 8 considering when a suit is deemed to be instituted within the meaning of Section 3 of the Indian Limitation Act. It was contended on behalf of the Appellants that a plaint cannot be presented except to a Judge who is the only person who can give leave to sue under clause 12 of the Letters Patent and that the presentation of the plaint to proper officer in the Prothonotary's office does not institute a suit where leave to sue is required under clause 12 of the Letters Patent. The Division Bench held that the arguments involved a confusion between “presentation of the plaint” and “admission or receipt of the suit”. The Division Bench held at page 87 as under :- “It is quite clear under our Rules and practice that the proper officer to receive the plaint is the Prothonotary, or somebody in his office to whom the duty is delegated by him. The only question is whether that rule can apply to a case to which cl.12 of the Letters Patent is applicable. It is settled law that giving of leave under cl.12 is a judicial act which cannot be delegated by the Court to the Prothonotary or any other officer, and the clause provides in effect that until leave is granted the Court shall not receive, try or determine the suit. But, I think, that the argument of the appellant really involves a confusion between “presentation of the plaint” and “admission or receipt of the suit”. To my mind, the plaint,even where leave is required,is presented when it is handed over by the plaintiff or his agent to the proper officer in the Prothonotary's office. If leave is required, the plaint 9 must be submitted to the Chamber Judge and leave obtained from him under cl.12 of the Letters Patent. When that leave is obtained the officer in the Prothonotary's office must see that the plaint is in order and admit it under Order IV, rule 2, and he cannot admit the plaint until the leave of the Judge has been obtained. But, to my mind, the obtaining of the leave of the Judge and the admission of the plaint does not affect in any way the presentation of the plaint for the purposes of the Indian Limitation Act. That being so, I think that the decision of the learned Judge is right and this suit was instituted within the period of limitation, viz., on May 25, 1932, and the plaintiffs are entitled to judgment in their favour.” (B). It is important to note that the question whether the leave ought to be applied for at the stage before presentation of the plaint under Order IV rule 1 of the CPC or at the stage before the admission thereof and its being entered in the register of civil suits did not arise in this case. The Division Bench did not deal with the question which falls for my consideration where admittedly leave was not even sought at either stage. 12. In an unreported judgment dated 8.12.1976 in Suit No.130 of 1977 in the case of – M/s.Shiv Silk Mills and other v. M/s.B. M. Khanna & Sons and others, Mridul, J. held that the expression “in case the leave of the Court shall have been first obtained” postulates that 10 but for such leave which was to be obtained before-hand, the suit would be unauthorized and incompetent. It was further held that the leave under clause 12 of the Letters Patent is a condition precedent for maintainability of the suit and in the absence of such leave the suit is rendered incompetent and the proceedings in respect thereof are a nullity. The learned Judge further held “it is well settled practice of this Court that a suit in respect of which leave is not obtained has to be dismissed”. The learned Judge held that there was an established practice of this Court not to return the plaint in such a case but to dismiss the suit. As far as this aspect is concerned, the learned Judge also noted the insertion of rule 269-A in Original Side Rules. 13. I must clarify that I do not find it necessary while considering the present application for leave under clause 12 of the Letters Patent to consider the consequence of leave not having been obtained though required. If and when an application is made by the Plaintiff or by either party based on this judgment, the point would be considered. 14. Before dealing with the judgments relied upon by Mr.Andhyarujina, it is necessary to refer to one other judgment. In 11 Rhoda J. Mehta & Ors. v. Homi F. Mehta & Ors., 1989 Mh.L.J. 124. The Plaintiff had filed the suit without obtaining the leave under clause 12 of the Letters Patent prior to the lodging of the plaint and sought an order for return of the plaint for presentation in the proper Court. It was contended on behalf of the Defendant that the suit ought to be dismissed. The learned Judge permitted the return of the plaint having held that the Court was not empowered to receive the plaint at the time when it was presented to this Court. The learned Judge differed with the judgment of Mridul, J. on the question whether the suit ought to be dismissed or whether the plaint ought to be returned. The learned Judge also differed with the judgment of another learned single Judge of this Court in Union Bank of India v. Sunpac Corporation and Ors., 1986 Mh.L. J. 237 which I shall refer to shortly. The learned Judge held that if the Court is not permitted to receive the plaint, before or after admission of a suit, it should not make any difference as the Court cannot deal with such a suit at all. The learned Judge held as follows :- “8. As rightly pointed out by Mr.Justice Rangnekar in the case of Devidatt Ramniranjandas vs. Shriram Narayandas (supra), the most important words in Clause XII of the Letters Patent 12 are “empowered to receive”. If I am not empowered to receive a plaint,it must necessarily mean that I ought not to have really admitted the plaint. If I have admitted the plaint, that is per se without jurisdiction and, if that is so, I must necessarily return the plaint to the person who has lodged the same.” Whether the plaint ought to be returned or whether the suit ought to be dismissed is again a question which need not detain me while considering the present application for leave under clause 12 of the Letters Patent. Suffice it to state that the effect of the judgment is that the leave ought to have been taken prior to lodging the plaint and not merely prior to admitting the suit. This view has been held to be per incuriam as I shall shortly demonstrate but that is of no relevance to the question before me as here the leave was not sought even before the next stage viz. the admission of the plaint and its entry in the register. 15. Jhunjhunwala, J. followed this judgment in Noorjahan v. Sadrunnisa, 1993 Mh.L. J. 208. Paragraph 4 of the judgment reads thus :- “4. Clause XII of the Letters Patent as applicable to this Court provides that this Court in exercise of its Ordinary Original Civil Jurisdiction shall be empowered to receive, try and determine 13 suits of every description if in the case of suits for land (omitting unnecessary words) the land is situate, or in all other cases, if the cause of action shall have arisen either wholly or in the case of the leave of the court shall have been first obtained, in part, within the local limits of the Ordinary Original Civil Jurisdiction of this Court (emphasis supplied). The words “empowered to receive” mean that the Court on the Ordinary Original Civil Jurisdiction has no jurisdiction even to receive a plaint where a part of the cause of action only shall have arisen within the local limits of its jurisdiction unless leave of the Court shall have been first obtained. The leave under clause XII of the Letters Patent is a condition precedent to jurisdiction, so that unless the condition is fulfilled by obtaining the necessary leave to sue, the Court will have no jurisdiction to entertain the suit. Such leave affords the very foundation of the jurisdiction and hence, it must be obtained before the institution of the suit. It cannot be granted after the suit has been instituted. (emphasis supplied.) In addition therefore to holding that the Court has no jurisdiction even to receive a plaint where leave under clause 12 of the Letters Patent though required is not taken, the learned Judge also held that such leave cannot be granted after the suit has been instituted. This latter finding is relevant for the purpose of the present case. 16. From the above judgments, one thing is clear. As held in Rampurtab's case, the leave must be granted at the time of 14 acceptance of the plaint and cannot be granted afterwards. This judgment was affirmed by the Division Bench in Devidatt' s case holding that the leave under clause 12 of the Letters Patent is a condition precedent to the maintenance and entertainment of the suit and that the leave of the Court should be first obtained i.e. obtained before the institution of the suit. The judgment in Noorjahan' s case also inter-alia held that the leave cannot be granted after the suit has been instituted. 17. Admittedly in the present case, the plaint has not only been presented but has also been admitted. In view of the above judgment, leave cannot be granted now at this stage. 18. Mr.Andhyarujina's reliance upon four judgments of this Court in support of his submission that leave can be granted even at this stage is not well founded. 19(A). In Union Bank of India v. Sunpac Corporation, 1986, Mh.L. J. 237, Sawant J. following the judgment in Ramgopal's case drew a distinction between “presentation” and “admission” of a plaint. The learned Judge held that so long as the plaint is not admitted and entered in the register of suits all defects including that of the absence 15 of leave under clause 12 of the Letters Patent can be removed without returning the plaint considering that there is no question of returning the plaint which is not admitted and that it simply remains under objection till it is admitted. In other words according to the learned Judge, it is necessary for a party to obtain the leave not at the stage of presentation of the plaint to the proper officer but prior to its admission and entry in the register of suits. (B). I do not see how this judgment is of any assistance to the Plaintiff. In the present case, admittedly the plaint has been admitted and entered in the register of suits. The question whether leave can be granted after the suit has been admitted and entered in the register did not arise before the learned Judge and there is nothing in the judgment which deals with the issue. 20. R.J. Kochar, J. in an unreported judgment dated 11.3.1999 in S.S. (Ldg.) No.213 of 1999, Nat Steel Equipment Pvt. Ltd. v. Bangalore Heart Hospital and Research Centre and Frank C. Spenccer Centre & anr. followed the judgment in Sunpac Corporation. For the above reasons this judgment too is of no assistance for deciding the question before me. 16 21. Mr.Andhyarujina relied upon a judgment of a learned single Judge, Khanwilkar, J. in Air India Ltd. v. Caribjet Inc., 2004(4) Bom. C.R., 53 and the judgment of the Division Bench (to which I was a party) in Caribjet Inc. v. Air India Ltd., 2005 (3), B.C. R., 1994, upholding the judgment. In that case the Plaintiff presented the plaint before the authorized officer of this Court on 20.7.2001. Leave under clause XII of the Letters Patent was granted by an order of this Court dated 8.9.2001. Thereafter the suit came to be numbered on 13.9.2001. It was contended that the Plaintiff had lodged the suit on 20.7.2001 without obtaining prior leave under clause 12 of the Letters Patent which was impermissible. The learned Judge following the judgment in Union of India v. Sunpac Corporation and the judgment in Nat Steel Equipment Pvt. Ltd. held that the plaint having been lodged prior to obtaining leave under clause 12 of the Letters Patent would make no difference and that it is only upon numbering of the suit that the suit can be said to have been received by this Court. The learned Judge therefore rejected the contention on behalf of the Defendant that the plaint be returned to the Plaintiff. 17 It must be noticed that in this case leave was obtained prior to the suit being admitted and numbered whereas in the case before me the plaint has been admitted and entered in the register and numbered without leave having even been sought. It is however, important to note that in paragraph 14 of the judgment, the learned Judge, referring to a judgment of this Court in M/s.Transasia Bio-Medicals Ltd. v. M/s.Revijay Clinical Laboratory and Hospital, 2002 (5) B.C. R. 1, observed :- “The opinion expressed in this judgment is that there can be no question of granting a post-facto leave. There can be no dispute that the said proposition is a view which has prevailed since long”. (emphasis supplied) This observation namely that there can be no question of granting post-facto leave is relevant in the present case. 22. The judgment in Air India Ltd. v. Caribjet Inc. was affirmed by a Division Bench (to which I was a party) in Caribjet Inc. v. Air India Ltd. 2005 (3) B.C. R., 94. Nowhere in this judgment has it been held that leave under clause 12 of the Letters Patent can be granted even after a plaint has been admitted pursuant to its having earlier 18 been presented. In fact in paragraph 10, the question was framed thus : “The question, therefore, is whether even lodging / filing / presentation of the plaint before the authorized officer of this Court is impermissible”. Following the judgments in Ramgopal Chunilal's case, Union of India v. Sunpac Corporation and others the judgment of the learned single Judge was affirmed. In paragraph 11 it was held :- “So long, therefore, as the plaint is not admitted and entered in the register of suits, all defects including that of the absence of leave under the said clause, can be removed without returning the plaint.” The above observations do not by any stretch of imagination indicate that the defect can be cured even after the plaint has been admitted. If anything, the observations are to the contrary. 23. Mr.Andhyarujina submitted that if, as held by some of the above judgments, a plaint cannot be admitted without leave under clause 12 of the Letters Patent, an order admitting the plaint would be a nullity. In that event, according to him, the plaint would still remain at the stage of having been