Case: Lila Filomena Braganza Vs. Hong Kong Investment Company Private Limited (In Liquidation), Through The Official Liquidator High Court, Bombay &amp; Others

legal representative has filed the appeal against the preliminary decree before any final decree is passed. By the preliminary decree, only rights in the immovable properties were declared. The demarcation of the property which would go to the share of the party is yet to be done, and therefore, in our opinion, it cannot be said that there is absolutely no justification for entertaining the appeal against the preliminary decree. One more aspect that is to be noted is that the present appellant was brought on record of final decree proceedings on 15.12.2008. Thus, taking overall view of the matter, therefore, in our opinion, it will be in the interest of justice to consider this appeal on merits.5. So far as the merits of the matter are concerned, it was contended on behalf of the appellant that the decree of declaration that the plaintiff has one half share in the land, is absolutely illegal. It was contended that in the absence of a registered document, right of the original defendants in the one half land owned by them cannot be extinguished and one half right in favour of the plaintiff in the land cannot be created without there being a registered document to that effect. Reliance was placed on the provisions of Section 17 of the Registration Act to claim that any conveyance of immovable property can be brought about only by a registered document. It was further contended that the deed of partnership is alleged to have been signed in 25.5.1974 and as per the averments in the plaint itself, the defendants denied their signature on the partnership deed in July,1974 and the partnership was dissolved by the plaintiff in September,1974, and therefore, it cannot be said that the partnership has started carrying on any business. It was, therefore, contended that no partnership had come into existence. It was also contended that even assuming that the immovable property is brought as capital by one of the parties in the partnership business and the other party bringing some other property or money, then the property becomes the asset of the partnership firm. In the present case, there is no capital contribution made by the plaintiff at all. According to the averments in the plaint, the plaintiff was to contribute for development of the property to the extent of Rs.3,00,000/-. Before the dissolution of the firm, no development of the property took place nor is there any evidence or averments that the plaintiff contributed anything towards the business of the firm before September,1974, and therefore, it cannot be said that in view of this situation, the plaintiff gets one half share in the immovable property.6. We have heard the learned Counsel appearing for original plaintiff. His basic submission was in relation to the application for condonation of delay which we have dealt with above. So far as the learned Counsel appearing for applicant who has filed the chamber summons for permission to intervene is concerned, we find that he has no locus in the matter because he claims to be the legal heir of the major shareholder and the Director of the plaintiff Company which is under liquidation. We do not find that when the company is a plaintiff and it is represented by the official liquidator, the legal representative of the share holder or the Director of the Company under liquidation will have any locus, and would either be a necessary or proper party in the Civil Suit. This is an appeal filed against a preliminary decree, and therefore, only those parties who are parties to the suit can be the parties to the appeal. If the applicant wanted to join as party in the appeal, he should have first taken up the proceedings in the pending civil suit for being joined as a party. Unless the applicant is permitted by the trial Court to be joined as a party, the appeal Court cannot permit anybody to be joined as a party. In any case, in our opinion, according to the settled Law the applicant cannot be termed either as a necessary party or as a proper party, and therefore, his application could not have been considered.7. As pointed above, the applicant has no locus in this proceeding and so far as the Official Liquidator is concerned, his only contention was in relation to the delay in filing of the appeal. Therefore, the only question that we have to consider is, in the facts and circumstances, whether it would be in the interest of justice to set aside the preliminary decree. In our opinion, it would be in the interest of justice to set aside the preliminary decree for the following reasons:-(i) That by the preliminary decree which is ex-parte decree, it has been declared that the plaintiff has one half share in the vast immovable property and that share has been given to the plaintiff only because the defendants and the plaintiff had signed partnership deed in the month of May,1974 without the plaintiff contributing any money towards business of the firm. In our opinion, it will be highly improper if a person is given share in the immovable property without spending anything for acquiring the property. We find no consideration whatsoever for which one half share could be given to the plaintiff in the immovable property. We find that it cannot be said on the basis of the material presently available on record that the partnership had commenced the business for which it was entered into. There was no business carried out by the firm. Addressing merely letters, making inquiries from the various agencies, in our opinion, does not amount to carrying out any business.(ii) We further find that the question whether without there being any registered deed, it can be said that the defendants have divested themselves of 50% ownership in the immovable property, has also to be considered in the light of the provisions of Section 17 of the Registration Act, which has not been done.8.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]Perusal of the above quoted Section 5 shows that the Court gets power to admit the appeal which is filed after expiry of period of limitation only after the appellant satisfies the Court that he had sufficient cause for not preferring the appeal within the period of limitation. Thus, when a Court of law admits an appeal for final hearing which is filed beyond the period of limitation, it implies that the Court is satisfied before making the order of admission of appeal that there was sufficient cause shown for not filing the appeal within limitation. That the Court has not given reasons for recording its satisfaction that the sufficient cause has been shown, may be the ground for challenging the order of the Court admitting the appeal either by filing an appeal against that order or by making an application for recall or review of that order. But without making an application for recall or review of that order, it cannot be urged either before the same Court or before theCourt that the order admitting the appeal should be ignored and the question that the sufficient cause has been shown by the appellant or not should be reconsidered. In our opinion, following such course of action would not be in accordance with law. In our opinion, if it was the grievance of the original plaintiffs that the appeal has been admitted without condoning the delay and without considering the sufficient cause, then its remedy was either to apply for recall or review of the order, or to challenge the order of admission of the appeal in an appeal. Having done none of these things, now the order passed by the Appeal Court admitting the appeal for final hearing is binding on the original plaintiffs, and therefore, the question of delay in filing the appeal cannot be reagitated.4.We also find from the record that the appeal has been filed by the legal representative of the original defendants. The legal representative has filed the appeal against the preliminary decree before any final decree is passed. By the preliminary decree, only rights in the immovable properties were declared. The demarcation of the property which would go to the share of the party is yet to be done, and therefore, in our opinion, it cannot be said that there is absolutely no justification for entertaining the appeal against the preliminary decree. One more aspect that is to be noted is that the present appellant was brought on record of final decree proceedings on 15.12.2008. Thus, taking overall view of the matter, therefore, in our opinion, it will be in the interest of justice to consider this appeal on merits.5.So far as the merits of the matter are concerned, it was contended on behalf of the appellant that the decree of declaration that the plaintiff has one half share in the land, is absolutely illegal. It was contended that in the absence of a registered document, right of the original defendants in the one half land owned by them cannot be extinguished and one half right in favour of the plaintiff in the land cannot be created without there being a registered document to that effect. Reliance was placed on the provisions of Section 17 of the Registration Act to claim that any conveyance of immovable property can be brought about only by a registered document. It was further contended that the deed of partnership is alleged to have been signed in 25.5.1974 and as per the averments in the plaint itself, the defendants denied their signature on the partnership deed in July,1974 and the partnership was dissolved by the plaintiff in September,1974, and therefore, it cannot be said that the partnership has started carrying on any business. It was, therefore, contended that no partnership had come into existence. It was also contended that even assuming that the immovable property is brought as capital by one of the parties in the partnership business and the other party bringing some other property or money, then the property becomes the asset of the partnership firm. In the present case, there is no capital contribution made by the plaintiff at all. According to the averments in the plaint, the plaintiff was to contribute for development of the property to the extent of Rs.Before the dissolution of the firm, no development of the property took place nor is there any evidence or averments that the plaintiff contributed anything towards the business of the firm before September,1974, and therefore, it cannot be said that in view of this situation, the plaintiff gets one half share in the immovable property.6.We have heard the learned Counsel appearing for original plaintiff. His basic submission was in relation to the application for condonation of delay which we have dealt with above. So far as the learned Counsel appearing for applicant who has filed the chamber summons for permission to intervene is concerned, we find that he has no locus in the matter because he claims to be the legal heir of the major shareholder and the Director of the plaintiff Company which is under liquidation. We do not find that when the company is a plaintiff and it is represented by the official liquidator, the legal representative of the share holder or the Director of the Company under liquidation will have any locus, and would either be a necessary or proper party in the Civil Suit. This is an appeal filed against a preliminary decree, and therefore, only those parties who are parties to the suit can be the parties to the appeal. If the applicant wanted to join as party in the appeal, he should have first taken up the proceedings in the pending civil suit for being joined as a party. Unless the applicant is permitted by the trial Court to be joined as a party, the appeal Court cannot permit anybody to be joined as a party. In any case, in our opinion, according to the settled Law the applicant cannot be termed either as a necessary party or as a proper party, and therefore, his application could not have been considered.7.As pointed above, the applicant has no locus in this proceeding and so far as the Official Liquidator is concerned, his only contention was in relation to the delay in filing of the appeal. Therefore, the only question that we have to consider is, in the facts and circumstances, whether it would be in the interest of justice to set aside the preliminary decree. In our opinion, it would be in the interest of justice to set aside the preliminary decree for the followingThat by the preliminary decree which isdecree, it has been declared that the plaintiff has one half share in the vast immovable property and that share has been given to the plaintiff only because the defendants and the plaintiff had signed partnership deed in the month of May,1974 without the plaintiff contributing any money towards business of the firm. In our opinion, it will be highly improper if a person is given share in the immovable property without spending anything for acquiring the property. We find no consideration whatsoever for which one half share could be given to the plaintiff in the immovable property. We find that it cannot be said on the basis of the material presently available on record that the partnership had commenced the business for which it was entered into. There was no business carried out by the firm. Addressing merely letters, making inquiries from the various agencies, in our opinion, does not amount to carrying out any business.(ii) We further find that the question whether without there being any registered deed, it can be said that the defendants have divested themselves of 50% ownership in the immovable property, has also to be considered in the light of the provisions of Section 17 of the Registration Act, which has not been done.