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2005 DIGILAW 1332 (MAD)

P. Ashoka & Others v. Nehru Edwin Raj & Others

2005-08-11

R.BANUMATHI

body2005
Judgment :- (PRAYER: Revisions filed against the order dated 25.02.2003, made in I.A.No.17501/2002 in O.S.No.3572/2000 on the file of the VII Assistant Judge, City Civil Court, Madras.) Common Order These two revisions are preferred against the order of the VII Assistant Judge, City Civil Court, Chennai, dated 25.02.2003, made in I.A.No.17501/2002 in O.S.No.3572/2000, allowing the petition filed under Or.1, R.10(2) CPC ordering impleading of the proposed parties/Respondents 2 and 3 as the Defendants 2 and 3. Plaintiff and the proposed parties have separately preferred these revisions. 2. O.S.No.3572/2002 :- This suit was filed by the Plaintiff for recovery of Rs.2,00,500/- on the basis of the Promissory Note in favour of the Plaintiff. Case of the Plaintiff is that the Defendant has borrowed a sum of Rs.2,00,000/- from one Rajini Swaminathan on 11.3.1997. Inspite of repeated demands, the Defendant has not paid the amount to the said Rajini Swaminathan. On 11.10.1999, the suit promissory note was assigned in favour of the Plaintiff for consideration. The Plaintiff had issued a legal Notice on 25.02.2000 demanding the payment of money. The Defendant received the notice and sent a reply with false allegations. Hence the Plaintiff has filed the suit for recovery of Rs.2,00,500/- with interest at 12% p.a. 3.Denying borrowal from Rajini Swaminathan, the Defendant has filed the Written Statement contending that Plaintiff's sister Mangammal had obtained loan for her business unit from Tamil Nadu Industrial Investment Corporation. Their residential premises at No.2, III Cross Street, West CIT Nagar, Chennai was brought for auction due to default in payment of the loan amount and the undertaking. At that time, the Plaintiff and his mother Kamala and sister Mangammal approached their Defendant for assistance in clearing the loan amount and for saving the property. As a well-wisher of the Plaintiff's family, the Defendant signed blank pro-note in good faith, without knowing the name of the promisee. Later on, money has been arranged through other sources to discharge the debt of Tamil Nadu Industrial Investment Corporation. Though the debt was discharged, signed pro-note was neither returned nor was it acted upon. The Defendant has no knowledge of the said Rajini Swaminathan using the suit promissory note as a vexatious document and cannot be relied upon to sustain the claim of the Plaintiff. The Plaintiff and his family members who are responsible for bringing into existence the suit pro-note are guilty of breach of faith. The Defendant has no knowledge of the said Rajini Swaminathan using the suit promissory note as a vexatious document and cannot be relied upon to sustain the claim of the Plaintiff. The Plaintiff and his family members who are responsible for bringing into existence the suit pro-note are guilty of breach of faith. The Plaintiff is not entitled to the amount claimed. 4. I.A.No.17501/2002 :- This application was filed by the Defendant to implead Plaintiff's mother Kamala and sister Mangammal. Reiterating the defence in the Written Statement, the Defendant has filed this application stating that he had no contact with Rajini Swaminathan and that no amount was borrowed by him at any time. The said Rajini Swaminathan and the Plaintiff are friends. In collusion with the Plaintiff, the suit has been filed against the Defendant. Plaintiff's mother Kamala and Mangammal are necessary parties for effective adjudication. It is further alleged that unless Plaintiff's mother Kamala and sister Mangammal are impleaded as parties, the Defendant would be subjected to hardship and there would not be effective adjudication. 5.The Plaintiff has resisted the application for impleading his mother and sister and filed a counter statement contending that the Plaintiff having admitted the execution of the promissory note is bound to prove the non passing of consideration for the promissory note. According to him, his mother Kamala and sister Mangammal have nothing to do with the borrowing of the amount, covered by the promissory note executed by the Defendant in favour of Rajini Swaminathan. It is further alleged that the Defendant having admitted the execution of the promissory note, the Defendant has to prove the failure of consideration rebutting the presumption of passing consideration under the Negotiable Instruments Act. The mother and sister of the Plaintiff are not at all necessary parties much less for effective adjudication. 6.Upon consideration of the rival submissions of both parties, the learned Assistant Judge allowed the application finding that the proposed parties are connected with certain dealings with Rajini Swaminathan from whom the Plaintiff had obtained the promissory note by assigning. The proposed parties are ordered to be impleaded on the ground that the Plaintiff had not shown as to what prejudice would be caused to him by impleading the proposed parties. The proposed parties are ordered to be impleaded on the ground that the Plaintiff had not shown as to what prejudice would be caused to him by impleading the proposed parties. 7.Assailing the impugned order, the learned counsel for the Plaintiff and the proposed parties has contended that the dispute between the proposed parties and the Defendant are interse dispute between them and that the suit is not the appropriate forum to settle their dispute. Contending that the Plaintiff is the dominus litus, the learned counsel for the Revision Petitioners submitted that the Plaintiff cannot be compelled to fight out the litigation against the parties whom he does not claim any relief. In support of his contention, the learned counsel for the Revision Petitioners relied upon the decision of the Division Bench reported in AIR 1999 Madras 109 [Bank of Rajasthan Limited., Vs. Transocean Bulk Carriers Limited and others]. It is also submitted that when the proposed parties have no connection with the borrowal, the trial court erred in ordering impleading of the Plaintiff's mother and his sister. 8.Contending that there is no error apparent on the face of the record warranting interference under Art.227 of the Constitution of India, the learned counsel for the first Respondent has submitted that for effective adjudication, the proposed parties – mother and sister are necessary parties. It is also submitted that the Plaintiff is not justified in disowning his mother and sister stating that he has no connection with the alleged transaction between the Plaintiff and his mother and sister. Drawing the attention of the Court to the counter statement filed by the Plaintiff, the learned counsel for the Defendant has submitted that no where in the counter statement, the Plaintiff has alleged as to how he is prejudiced by impleading his mother and sister. The learned counsel has also contended that the Court below had rightly ordered impleading of the proposed parties and the same has to be sustained, giving an opportunity to the Defendant to effectively put-forth his defence. 9.Upon consideration of the contentions of both parties, impugned order and other materials on record, the following points arise for consideration in this revision :- (i)whether the proposed parties are necessary parties for the complete and effective adjudication ? (ii)whether the impugned order directing impleading of the proposed parties suffers from material irregularity warranting interference ? 9.Upon consideration of the contentions of both parties, impugned order and other materials on record, the following points arise for consideration in this revision :- (i)whether the proposed parties are necessary parties for the complete and effective adjudication ? (ii)whether the impugned order directing impleading of the proposed parties suffers from material irregularity warranting interference ? 10.The Defendant is alleged to have borrowed a sum of Rs.2,00,000/- from Rajini Swaminathan on promissory note, on 11.03.1997. The said promissory note has been made over to the Plaintiff for consideration. The Plaintiff is the son of the proposed party No.1 (Kamala) and brother of proposed party no.2 (Mangammal). The Defendant seeks to implead them stating that the Plaintiff's sister Mangammal had borrowed loan from Tamil Nadu Industrial Investment Corporation for running her business Unit. It is further alleged that there was default in payment of the instalments and the residential house of the proposed parties were brought for auction sale by Tamil Nadu Industrial Investment Corporation. For raising amount for discharge of the said loan, the Defendant had signed blank promissory note which had been misused by the Plaintiff and his family members to create a promissory note. Further, according to the Defendant, he had no contact with Rajini Swaminathan and that he has not borrowed any amount from her and the said Rajini Swaminathan and the Plaintiff are friends and the suit has been filed in collusion with the Plaintiff. By a careful consideration of the defence set forth by the Defendant, it is seen that the dispute between the Defendant and the proposed parties is an interse dispute between them. The Plaintiff's case is a simple suit based on the promissory note executed by the Defendant where the Defendant has admitted his signature. The Plaintiff filed the suit for recovery of money against the Defendant. By impleading the proposed parties, the simple issue involved in the suit would only be complicated. 11.In the supporting affidavit, the Defendant had stated, "In fact, the proposed second Defendant do not have her funds for which I signed several pronotes in Blank. Already the said Mangammal was in debt to TIIC. I have paid Rs.8,00,000/- to Mangammal. The said Mangammal and her mother R.Kamala and the Plaintiff were my family friends". 11.In the supporting affidavit, the Defendant had stated, "In fact, the proposed second Defendant do not have her funds for which I signed several pronotes in Blank. Already the said Mangammal was in debt to TIIC. I have paid Rs.8,00,000/- to Mangammal. The said Mangammal and her mother R.Kamala and the Plaintiff were my family friends". The Defendant has further alleged, "In fact, I have no contact with Ms.Rajini Swaminathan and no amount was borrowed by me at any time. The said Ms.Rajini Swaminathan and the Plaintiff are friends as per letter of Plaintiff dated 1.7.2002 in collusion the Plaintiff falsely filed the present suit against me." 12.Without proper appreciation of the above averments, the learned Judge has observed, "vdnt ,e;j epiyapy; u$pdp rhkpehjDld; Vw;gl;Ls;s rpy Dealingsy; 2tJ kw;Wk; 3tJ vjph;kDjhuh;fs; rk;ge;jg;gl;Ls;shh;fs; vd;Wk;. mjdhy; mth;fs; ,e;j tHf;fpy; jug;gpdh;fshf nrh;f;fntz;Lnkd;W kDjhuh;-gpujpthjp TwtJ Vw;g[ilajhf ,e;j ePjpkd;wk; Kot[ bra;fpd;wJ". The Court below erred in saying as if the proposed parties had some dealings with Rajini Swaminathan. There seems to be no proper understanding of the defence wherein the Defendant has alleged that Defendant had no dealing with Rajini Swaminathan. The above observation of the lower court is erroneous and not sustainable. 13.Or.1, R.10 CPC enables the Court to add any person at any stage of the proceeding if the presence of such person is found necessary to effectively/completely adjudicate upon all the controversies involved in the case. For determining the question as to who is a necessary party, few of the tests are :- (i) there must be a right to some relief against such party in respect of the matter involved in the suit in question; (ii)it should not be possible to pass an effective decree in the absence of such party. The eventual interest or otherwise of a party in the fruits of litigation cannot be held to be the true test of impleading a party; -and- (iii)that an equitable grounds, the Defendant has some dispute (regarding the subject matter of the dispute) with the party is not the true test. 14.In order that a party may be added as a Defendant in a Negotiable Instruments Act suit, he should have a legal interest distinguished from an equitable interest, but an interest which the law recognizes. 14.In order that a party may be added as a Defendant in a Negotiable Instruments Act suit, he should have a legal interest distinguished from an equitable interest, but an interest which the law recognizes. That person who would be only indirectly or commercially affected by the result of a litigation cannot be impleaded as a party as a person having a direct interest in the subject matter in dispute. 15.In AIR 1968 Madras 142 [Krishnamachari Vs. Dhanalakshmi], it was held that to add any person as Defendant in the suit, it is essential that he should have a legal and tangible interest in the subject matter of the dispute. 16.The proposed parties should have legal interest distinguished from equitable interest. It may be that in view of the defence set forth by the Defendant, on equitable grounds, the proposed parties may seem to be necessary parties. But viewed in the light of issues/involved in the suit the proposed parties have no legal interest in the subject matter of the dispute to add them as parties to the suit. 17.The Plaintiff is the domius litus. He cannot be compelled to fight out the litigation whom he does not choose to bring the lis. Submitting that the Plaintiff cannot be compelled to be impleaded as party, who has no direct interest in the suit claim, the learned counsel for the Revision Petitioners relied upon the decision of the Division Bench reported in AIR 1999 Madras 105, wherein this Court us held :: “Doctrine of "Dominus litis" is applied to one, who though not originally a party has made himself such, by intervention or otherwise, and has assumed the entire control and responsibility for one side and it is treated by the Court as liable for costs and a person who is really and directly interested in the suit as a party. When the cause of action is between the Appellant Plaintiff and Defendants 1 to 5 for recovery of Rs.1,22,00,000/- being the amount of two cheques, there is no direct interest of the proposed applicant and the Plaintiff and it is a lis between Plaintiff and Defendants 1 to 5 and any transaction between Respondent No.6 and the proposed applicant is independent of the cause of action of the Plaintiff/ Appellant. Therefore, it cannot be said that the proposed applicant has a direct interest in the suit claim. Therefore, it cannot be said that the proposed applicant has a direct interest in the suit claim. The Plaintiff has no interest in the transaction claimed by the proposed applicant. It is a matter interse between the Respondent No.6 and the Appellant. When the transaction between applicant and Respondent No.6 constitutes a different cause of action and his claim is subject to proof of the transaction between him and the sixth Respondent which can be secured by resorting to a legal remedy, he is unnecessary party, that too, at the appellate stage." 18.The above decision squarely applies to the case in hand. The Plaintiff has filed the suit for recovery of money from the Defendant. It cannot be said that the proposed parties have any direct interest in the suit claim. Let us assume that the proposed parties are impleaded as the Defendants in the suit. They would not file any Written Statement nor would object to the claim of the Plaintiff. On the other hand, the Defendants would be entangled in the interse dispute between them. The real controversy between the Plaintiff and the Defendant would be complicated and the entire trial proceedings may have to be deflected to the inters controversy between the Defendants. Or.1 R.10(2) CPC cannot be stretched to such an extent of impleading the parties as the Defendants would be having the inters dispute among them. 19.Trial court erred in saying that the proposed parties are involved in dealings with Rajini Swaminathan. The trial court has neither properly appreciated the defence put-forth nor the subject matter of the controversy. The proposed parties are neither necessary parties nor proper parties to the suit. The impugned order suffers from material irregularity warranting interference, in exercising the power under Article 227 of the Constitution of India. Hence setting aside the impugned order, these two revisions are to be allowed. 20.For the foregoing reasons, the order dated 25.02.2003, made in I.A.No.17501/2002 in O.S.No.3572/2000 on the file of the VII Assistant Judge, City Civil Court, Madras is set aside and these two revisions are allowed. Consequently, C.M.P.No.10444/2003 is closed. In the circumstances of the case, there is no order as to costs.