Case: New Redbank Tea Co. Pvt. Ltd Vs. Kumkum Mittal &amp; Others

er of the dispute between the parties is Dharanipur Tea Estate situate in District Jalpaiguri in West Bengal. One Dhirendra Nath Bhowmick (deceased) had obtained the lease of the land of the said tea estate from the Government of West Bengal. The said lease was for a term of thirty years commencing from October 27, 1964. The New Red Bank Tea Co. Pvt. Ltd., appellant 1 owns the Red Bank Tea Estate and Surendra Nagar Tea Co. Pvt. Ltd., appellant 2 herein, owns the Surendra Nagar Tea Estate. Dhirendra Nath Bhowmick and his wife, Smt Reba Bhowmick, respondent 3 herein, were having controlling block of shares in both these companies4. On March 16, 1977, Dhirendra Nath Bhowmick granted afor the Dharanipur Tea Estate in favour of appellant 1. By virtue of his control over appellants 1 and 2, Dhirendra Nath Bhowmick was the Managing Director of the said two companies and the three tea gardens were under his management. On May 14, 1981, Dhirendra Nath Bhowmick and respondent 3 sold their controlling shares in appellants 1 and 2 to Robin Paul, appellant 3, and his group for valuable consideration and the charge of the three tea estates was handed over to appellant 3 and his group. In May 1984, Dhirendra Nath Bhowmick and respondent No. 3 filed a suit (Title Suit No. 8 of 1984) against the appellants as well as respondents 4 to 10 and 12 in the court of Assistant District Judge, Jalpaiguri seeking for a declaration that the transfer of controlling interest of shares in appellants 1 and 2 are not valid and prayed for a declaration that Dhirendra Nath Bhowmick had all the legal and equitable rights, title and interest in respect of the Dharanipur Tea Estate and for restoration of possession. The said suit was subsequently transferred to the High Court on November 27, 1984 under Clause 13 of the Letters Patent and it was renumbered as Extraordinary Suit No. 1 of 1985.5. While the said suit was pending, respondent 11 filed a suit (Suit No. 240 of 1990) in the High Court for specific performance of an agreement dated January 15, 1990 said to be executed by Dhirendra Nath Bhowmick and M/s Dharanipur Tea Industries Pvt. Ltd., respondent 7 herein, in favour of respondent 11 for the sale of the Dharanipur Tea Estate. In the said suit respondent 11 filed applications for injunction as well as for appointment of receiver which were dismissed by the learned Single Judge of the High Court by order dated April 1, 1991. Respondent 11 filed appeals against the said order of the learned Single Judge and the said appeals were disposed of by a Division Bench of the High Court by a consent order dated August 2, 1991 wherein it was recorded that the respondents (defendants in Suit No. 240 of 1990) had agreed to execute the Deed of Conveyance in favour of(respondent 11 herein). By the said order a receiver was appointed over the Dharanipur Tea Estate who was empowered to take possession of Dharanipur Tea Estate and allow respondent 11 to run the said tea estate until the Deed of Conveyance was executed and the Registering Authority was directed to register the Deed of Conveyance without insisting upon production of "no objection certificate" under Sectionand a certificate under Sectionof the Income Tax Act, 1961 and the police authorities and other appropriate administrative authorities were directed to afford all facilities, cooperation and help for the purpose of carrying out of the said order. On the basis of the said order the Receiver on August 3, 1991 obtained symbolic possession of the Dharanipur Tea Estate and posted Mr. Rungta as the authorised representative for respondent 11 to run, manage and look after the affairs of the said tea estate and the appellants were dispossessed from the said tea garden. The said order of the High Court dated August 2, 1991 was set aside by this Court by order dated September 9, 1991 in C.A. No. 3569 of 1991, New Red Bank Pvt. Ltd. v. Tarai Tea Company Pvt. Ltd. on the view that Extraordinary Suit No. 1 of 1985 as well as Suit No. 240 of 1990 ought to have been tried together and the suit for specific performance filed by respondent 11 could not have been decreed by consent without determining the legal title to and factum of possession of the suit property and that the title and possession could not have been decided without impleading appellant 1 as a party to the suit. This Court, while setting aside the decree for specific performance as well as the order appointing the Receiver, directed the Receiver to deliver back the possession of the property to appellant 1. With the setting aside the decree for specific performance, the sale deed that had been executed and registered stood automatically cancelled. Thereafter appellant 1 was impleaded as a defendant in Suit No. 240 of 1990 by order dated November 18, 1992.

Court's reasoning:
8. Feeling aggrieved by the said order of the learned Single Judge, respondent 11 filed an appeal which was allowed by the Division Bench of the High Court by judgment dated September 22, 1993 on the view that the learned Single Judge was not right in holding that the presence of respondent 11 was not necessary for effectual and complete adjudication of the matter in dispute. According to the learned Judges the addition of respondent 11 is necessary to avoid the possibility of a multiplicity of the judicial proceedings and that if respondent 11 is kept out of the suit and ultimately the same is dismissed, such outcome will not bind them and they will nonetheless have to challenge the decree passed in such suit by way of a separate proceeding only to continue the suit for specific performance. The present appeal is directed against the said judgment of the Division Bench of the High Court9. The application for being impleaded as a defendant was moved by respondent 11 under Order I, Rule 10(2) CPC which provides as under"(2) The Court may at any stage of the proceedings, either upon or without the application of either party, and on such term as may appear to the Court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit, be added." *10. The said provision empowers the court to implead as a party to a suit a person (i) who ought to have been joined, whether as plaintiff or defendant; or (ii) whose presence before the court may be necessary in order to enable the court to effectually and completely adjudicate upon and settle all the questions involved in the suit. It is not the case of respondent 11 that they ought to have been joined as a defendant in E.O. Suit No. 1 of 1985. Their application has been allowed by the Division Bench of the High Court on the ground that presence of respondent 11 is necessary for effectual and complete adjudication of the matter in dispute. We find it difficult to agree with this view of the High Court.In the instant case respondent 11, admittedly, have no legal interest in theof the dispute in E.O. Suit No. 1 of 1985. All that they are claiming is specific performance of the agreement for sale of Dharanipur Tea Estate said to have been executed by Dhirendra Nath Bhowmick and respondent 7 on January 15, 1990. The said agreement was executed long after the institution of E.O. Suit No. 1 of 1985. Moreover, the reliefs claimed by the plaintiffs in E.O. Suit No. 1 of 1985 relate to the validity of the agreement dated May 14, 1981 whereby the plaintiffs in that suit had transferred their controlling shares in appellants 1 and 2 in favour of appellant 3 and his group. In the said suit, the possession of Dharanipur Tea Estate is claimed only on the basis of control over appellant 1 which is aof the said tea estate. On the other hand Suit No. 240 of 1990 filed by respondent 11 relates to specific performance of the agreement relating to the sale by Dhirendra Nath Bhowmick and respondent 7 of Dharanipur Tea Estate. Respondent 11 cannot be said to be directly interested in the matter of validity of agreement executed by Dhirendra Nath Bhowmick and respondent 3 on May 14, 1981. We are, therefore, unable to hold that the presence of respondent 11 is necessary for effectual and complete adjudication of the matter in E.O. Suit No. 1 of 1985. The presence of respondent 11 in those proceedings, on the other hand, might cause prejudice to the rights of the appellants in the said suit. Moreover, both the suits are being tried together in accordance with the directions given by this Court by its order dated September 9, 1991.