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2003 DIGILAW 232 (DEL)

USHA DONGRE v. JYOTI TENT HOUSE

2003-03-04

PRADEEP NANDRAJOG, USHA MEHRA

body2003
PRADEEP NANDRAJOG, J. ( 1 ) THE present judgement disposes of FAO (OS) Nos. 265/93, 247/93 and 1/94. ( 2 ) ALL the three appeals are directed against the order dated 27. 9. 93 disposing of various interim applications filed in Suit No. 1122/88. , the effect of the order sought to be impugned is that the suit filed by Jyoti Tent House" (Regd.) under Order 37 of the Code of Civil procedure stood decreed against the defendants therein. However, a direction was" issued that the name of the Bombay Society be deleted from the array of parties. ( 3 ) AGGRIEVED by the said order, Defendant no. 2 has filed FAO (OS) 247/93. Defendant no. 3 has filed FAO (OS) 1/94 and the plaintiff has filed FAO (OS) 265/93. ( 4 ) IN brief, facts leading to the passing of the impugned order be noted. Jyoti Tent house filed suit under Order 37 of the Code of Civil Procedure on the basis of cheque no. 890979 dated 30. 11. 85 drawn in its favour by "national Society for Equal Opportunities for the Handicapped" in the sum of rs. 3,72,201. 50. Needless to say that the said cheque, when presented, was dishonoured with the remarks "as referred to drawer". ( 5 ) JYOTI Tent House filed the suit impleading the following as defendants:- (1) M/s National Society for Equal opportunities for the Handicapped; (i) Head Office ; NASEOH India, Postal colony Road, Chembur, Bombay 400071; (ii) Registered office E-67, Ansari Nagar, new Delhi-29, (2) Sh. Om Wadhwa, President M/s national Society for Equal Opportunities for the Handicapped, resident of A-9/ 15, Vasant Vihar, New Delhi-110057, (3) Ms. Usha Dongre, Secretary M/s national Society for Equal Opportunities for the Handicapped, D-4/207, safdarjung Enclave, New Delhi. " ( 6 ) IT was stated in the suit that the defendant no. 1 is a registered society of which defendant no. 2 is the President/chairman and defendant no. 3 is the Secretary. It was alleged that all defendants are jointly and severally liable for the claim in the suit. ( 7 ) AVERMENTS pertaining to the issuance of the cheque were that the defendants-society made a request to the plaintiff to provide catering services at the Fourth National Sports meet for the handicapped persons organised by the defendant at Jawahar Lal Nehru stadium, New Delhi. Certain advance payments were received. ( 7 ) AVERMENTS pertaining to the issuance of the cheque were that the defendants-society made a request to the plaintiff to provide catering services at the Fourth National Sports meet for the handicapped persons organised by the defendant at Jawahar Lal Nehru stadium, New Delhi. Certain advance payments were received. The plaintiff provided the requisite catering services and presented a bill which, after adjustment of the payments already made, was certified for payment for the sum of Rs. 3,72,201. 50 and it was towards liquidation of the said due that the cheque no. 890979 dated 30. 11. 85 drawn on State bank of India, Ansari Nagar, New Delhi in favour of the plaintiff for the sum of rs. 3,72,201. 50 was issued. When presented for encashment, the cheque was dishonoured. Notices were served upon the defendants to pay the amount under the cheque. No payment being received, the suit was filed claiming decree in the sum of Rs. 5,12,201. 50 being the principal amount and cumulative interest thereon from the date of the cheque till the date of filing of the suit, pendente lite and future interest was also claimed. ( 8 ) AS noticed above, in the memorandum of parties two addresses of the defendant no. 1 were given, being the head office address and the other being the registered office address. ( 9 ) ON the filing of the suit, summon is in the prescribed form were served upon the defendants. Since, two addresses of defendant No. 1 were set out in the memo of parties, defendant No. 1 was served at the delhi address as also at the Bombay Address. Defendants 2 and 3 served at the addresses given. ( 10 ) APPEARANCE was entered on behalf of defendants 2 and 3. Appearance was entered on "behalf of defendant No. l under the authority of one Sh. K. D. Sethi, Vice President from Bombay. No appearance was entered by any person from the Delhi office. ( 11 ) AN application under Order 1 Rule 10 (2) read with Order 38 Rule 6 (2) and Section 151 of the Code of Civil Procedure being IA no. 3485/88 was filed under the signatures of sh. K. D. Sethi. In this application it was stated that appearance was being entered as the plaintiff had, against the name of defendant no. 3485/88 was filed under the signatures of sh. K. D. Sethi. In this application it was stated that appearance was being entered as the plaintiff had, against the name of defendant no. l given two addresses and summons of the suit were served at the address given in bombay. It was stated in the said application that the memo of parties stated in the suit was misleading and was an attempt to cause confusion. It was stated that "national Society for Equal Opportunities for the Handicapped" is the Society registered at Bombay under the Societies Registration Act, 1860. It is as well a Society registered at Delhi under the punjab Societies Registration Act, 1860 as extended to the Union Territory of India. It was alleged that it is thus incorrect to state that defendant No. l has its head office at bombay and the registered office at Ansari nagar. It was further alleged that to draw the distinction, one may refer to the society registered at Delhi being "delhi Society. " It was further alleged that defendants 2 and 3 were the office bearers of the Delhi Society and it was the Delhi Society which had entered into some kind of transaction with the plaintiff and as a result thereof had become indebted to the plaintiff. Thus, it was prayed that in the memo of parties the words " (ii) Head Office, naseoh India, Postal Colony Road, Chembur, bombay 400071" be deleted. ( 12 ) IN sum and substance case pleaded in IA 3488/88 was not to confuse the Delhi Society and Bombay Society as the same entity and that further proceedings be taken in the suit with the said clarification and it is only the delhi Society which should be proceeded against. ( 13 ) IT may also be mentioned here to complete the record, that on 19th May, 1988 in IA No. 2796/88 an order for attachment of the bank account being SB A/c No. 9198 with the Bank of Baroda, Chembur, Bombay was ordered and pursuant thereto attachment was effected. It was, thus, prayed in IA no. 3485/88 that the attachment be lifted. ( 14 ) BY way of abundant precaution, an application under Order 37 Rule 3 (5) being IA no. 4955/88 was also filed on behalf of the bombay Society under the signatures of Sh. K. D. Sethi. It was, thus, prayed in IA no. 3485/88 that the attachment be lifted. ( 14 ) BY way of abundant precaution, an application under Order 37 Rule 3 (5) being IA no. 4955/88 was also filed on behalf of the bombay Society under the signatures of Sh. K. D. Sethi. ( 15 ) DEFENDANTS 2 and 3 entered appearance summons for judgment were taken out by the plaintiff. In response thereto, defendant no. 2 filed an application for leave to defend being IA NO. 4821/88. Defendant No. 3 likewise moved an application for leave to defend being IA No. 7263/88. As noted above, an application for leave to defend, by way of abundant caution being IA No. 4955/88 was filed on behalf of the Bombay Society. No application for leave to defend on behalf of the Delhi Society came to be filed. ( 16 ) BY order dated 27th September, 1999, ia No. 4821/88 and 7263/88 filed by defendants 2 and 3 were dismissed on the ground that defendants 2 and 3 being the office bearers of defendant No. 1 at Delhi were responsible for the acts of the Society at delhi. There being no application for leave to defend by the Delhi Society and the cheque having been signed by defendants 2 and 3, suit against the Delhi Society and defendants 2 and 3 was dismissed. ( 17 ) ON the application being IA No. 3485/88 filed by the Bombay Society it was held that the Society at Bombay and the Society at delhi were different societies and since the entire transactions between the plaintiff was with the Delhi Society, in the memo of parties the address of the defendant No. 1 which was the address of the Bombay Society was required to be deleted. As a consequences, there was no need for the Court to proceed with IA No. 4955/86, same was dismissed as not pressed ( 18 ) THREE appeals came to be filed which are subject matter of disposal by the present judgment. We may take up the appeals filed by defendants 2 and 3. Appeal by defendant no. 2 (0m Wadhwa) is FAO (OS) 247/93 and appeal by defendant No. 3 (Ms. Usha Dongre) is FAO (OS) 1/94. The case pleaded by said defendants is short and simple. We may take up the appeals filed by defendants 2 and 3. Appeal by defendant no. 2 (0m Wadhwa) is FAO (OS) 247/93 and appeal by defendant No. 3 (Ms. Usha Dongre) is FAO (OS) 1/94. The case pleaded by said defendants is short and simple. The suit was based on a cheque issued by a Society and there was no question of any vicarious liability of the office bearers of the Society. At no stage did they stood personal guarantee for payment of the amount covered by the cheque. There is no averment in the suit, save and except that officer bearers of the society are responsible for the acts of the society. This averment, is insufficient to make defendants 2 and 3 liable for payment under the cheque in dispute. ( 19 ) IN our opinion the said submission of the appellants in FAO (OS) 247/93 and 1/94 is legally sound. Apart from the fact that there are no averments to show as to how said two persons are jointly and severally liable for making payment under the cheque, even otherwise on the suit as framed they cannot be made liable. Defendant No. 1 is admittedly a Society and for a normal business transaction, no vicarious liability can be fastened upon its officer bearers in the absence of pleadings and proof that they were personally liable due to they having stood personal guarantee. We, accordingly, allow fao (OS) 247/93 and FAO (OS) 1/94. The impugned order is quashed in so far the same relates to defendants 2 and 3. IA Nos. 4821/88 and 7263/88 filed by them for leave to defend is consequently allowed. ( 20 ) COMING to the second part of the impugned order, in our opinion, the matter has been over simplified in the impugned order The averment made by the so called bombay Society that it is a body different than the so called Delhi Society, did not merit the directions in the order that the plaintiff could not proceed against the, so called bombay Society. The consequent direction for no proceeding ahead with further adjudication in IA No. 4955/88, being consequential also needs to be rectified. ( 21 ) OUR reasons for the same. The consequent direction for no proceeding ahead with further adjudication in IA No. 4955/88, being consequential also needs to be rectified. ( 21 ) OUR reasons for the same. From the pleadings of the parties it is evident that the national Society for Equal Opportunities for the Handicapped" is an All India Society having its registered address at Chembur, Bombay. It has regional chapters in the various States and Union Territories of Delhi. It was at the behest of the "national Society for Equal opportunities for the Handicapped" that a decision was taken to hold a National Sports meet for the Handicapped in the month of october, 1985 at New Delhi. The head officer at Bombay interacted with the Delhi chapter and requested it to make the necessary arrangements. The Sports Meet was financed by the Union Government. ( 22 ) SINCE the office bearers of the regional chapters constitute the membership of the governing counsel of the Apex body, their names are printed on the letter heads of the apex body. The names of defendants 2 and 3 accordingly, appear on the letter heads of the Apex body at Bombay during the relevant period. The letter evidencing the fact that it was the Apex body at Bombay which was to conduct the Sport Meet is evidenced by letter dated 20th September, 1984 addressed to the Secretary, Railways Sports Control Board to make available Jawahar Lal Nehru Stadium to it for the Sports Meet. Copy of this letter has been endorsed to defendant No. 2. What is the status of the regional chapters vis-a-vis the national body needs to be further dilated upon? By letter dated 23rd November, 1984 (which is on record of the suit file) the Apex body has referred to the regional chapters as "naseoh branches". What is the functional implication of the same needs to be further dilated upon? We are not further dilating on the issue because it would have a bearing on the application for leave to defend filed by the apex body, and as would be evident from our judgment hereunder; the said application in our opinion requires consideration on merits, which has to be done in the suit. ( 23 ) PROCEEDING further with the narration of fact, the President of the Apex body at bombay requested defendant No. 2 to arrange for catering facilities. He was requested to make all arrangements. ( 23 ) PROCEEDING further with the narration of fact, the President of the Apex body at bombay requested defendant No. 2 to arrange for catering facilities. He was requested to make all arrangements. This was duly and fully complied with by defendants 2 and 3 and indeed the All India Sports Meet under the ages of the Apex body at Bombay was held at Jawahar Lal Nehru Stadium, New Delhi. Coordination work thereof was done by the delhi chapter. We may at this stage note averments made by defendants 2 and 3 in the application filed by them for leave to defend. It is their common case that the "national society for Equal Opportunities for the handicapped" (NASEOH), defendant No. 1, is a Society registered under the Bombay Public trust Act, 1950 with its registered office at chembur, Bombay and branch office in different parts of the country. Thus, the so called Delhi Society is referred to as the branch office. This, as noticed above, is in line with the letters of the Society at Bombay that in the states of Union Territories what existed were its branches. ( 24 ) ON the mere fact that the Delhi branch has a separate registration and the All India society registered at Bombay has a separate registration, the findings in the impugned order has been arrived at, since the cheque in question was issued by the Delhi branch or we may say the Society registered at Delhi. Was this enough justification to strike out the bombay address from the memo of parties, effectively resulting in an adjudication that the defendant No. 1 with its registered office at Bombaywas not liable under the cheque in question? To our mind, this is an over simplification of the issue. In the least, matter required further consideration and the application for leave to defend being IA no. 4955/88 required consideration on merits. ( 25 ) WE have noticed from the facts above that the Sports Meet held at Jawahar Lal nehru Stadium, New Delhi was organised by the Apex body registered having its head office at Bombay. The Delhi chapter was acting on behalf of the main body and undertook to provide breakfast, lunch and dinners to the participants who had arrived at New Delhi from the various States. This arrangement was obviously on behalf of the apex body. The Delhi chapter was acting on behalf of the main body and undertook to provide breakfast, lunch and dinners to the participants who had arrived at New Delhi from the various States. This arrangement was obviously on behalf of the apex body. The plaintiff was clearly given to understand that it was a national function and he was required to provide catering facilities. The plaintiff admittedly has provided catering facilities for which the entire bill has not been cleared. Settlement of the bills clearly shows that the cheque amount was found due and payable and cheque was issued. The fact that "national Society for Equal opportunities for the Handicapped" is registered by the same name at two places and technically there are two separate legal entities in existence may have no bearing if principles of estopple are applied. We have noted above that the letter of the body registered at Bombay has referred to the body registered at Delhi as its branch pleadings in the application for leave to defend are also suggestive thereof. If the plaintiff was given to understand that the Delhi office is a branch of the main office of the main registered body at Bombay the Bombay Society may be estopped from pleading that the Dein society is a separate body. All these issues require consideration. One cannot loose Sight of the basic fact that it was indeed an evens organised by the Bombay Society which has an All India character and the Delhi chapter (Delhi Society) was acting as an agent, under the instructions of the Bombay Society, which is the national body. All these aspects would require consideration on the facts as noted by us above. ( 26 ) SINCE the aforesaid facts have not been taken into consideration in the impugned order and as the consequence of the cryptic finding in IA No,3485/88 [order 1 Rule 10 (2)] the consequence was that IA No. 4955/88 became infructuous, the matter needs reexamination. ( 27 ) AS a result of our findings above, the impugned order, in so far it relates to IAs 3485/88 and 4955/88 require to be set aside. Consequently, FAO (OS) No. 265/93 is also allowed. ( 27 ) AS a result of our findings above, the impugned order, in so far it relates to IAs 3485/88 and 4955/88 require to be set aside. Consequently, FAO (OS) No. 265/93 is also allowed. ( 28 ) PARTIES are directed to appear before the single Judge in the suit on 28/3/2003 who would proceed to dispose of IA No. 4955/88 (being the leave to defend the application filed by defendant No. 1 under the authority of the Bombay office) in light of our observations above. ( 29 ) IN the peculiar facts and circumstances of the case, there shall be no order as to costs.