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2012 DIGILAW 2300 (RAJ)

Yogeshwari Kumari v. Sh. Arvind Singh Mewar

2012-12-12

NIRMALJIT KAUR

body2012
JUDGMENT 1. - This is an application for seeking clarification of the order dated 11.06.1993 passed by Single Bench of this Court in S.B.Civil Misc. Appeal No. 84/1986. The clarification sought are as under:- "(a) Clarify that the true and correct purport of the order dated 11.06.1993 passed by this Hon'ble Court in S.B.Civil Misc. Appeal No. 84 of 1986 is that the appellant, in any capacity whatsoever, in which he is in possession/management/control of the suit properties cannot, either by himself or through his agents, servants or officers, either directly or indirectly, dispose of or cause to dispose of and/or alienate or otherwise deal with the suit properties till the decision of the suit; (b) Further clarify that the appellate court cannot create or indirectly cause creation of any third party interest in the suit properties (in his possession/management/control) and that he is duty bound to prevent the disposing of and/or alienation of or otherwise dealing with the suit properties by his agents, servants or officers; and (c) Pass ad-interim ex-parte order directing the appellant, his agents, servants and officers not to alienate and/or to prevent from alienation the said properties, being Jag Mandir, Fateh Prakash Palace, Garden Hotel and Shiv Niwas Palace, to IHC-Taj Group during the pendency of this application." 2. The brief facts of the case are that on 18.04.1948, the erstwhile Ruler of Mewar Maharana Bhopal Singh signed the Instrument of Accession with the Government of India, pursuant whereto, the erstwhile State of Mewar merged in the then United States of Rajasthan. Thereafter, pursuant to the Covenant of Merger, Maharana Bhopal Singh forwarded a list of the properties to be retained by him as his personal and private properties, which was approved by the Ministry of States, Government of India, vide its letter dated 29.09.1950. On 04.07.1955, Maharana Bhopal Singh expired and Maharana Bhagwat Singh succeeded to the throne of Mewar. Vide letter dated 02.08.1955, the President of India recognised Maharana Bhagwat Singh as the Ruler of the former State of Mewar as per Clause 22 of Article 366 of the Constitution. Maharana Bhagwat Singh incorporated the Lake Shore Palace Hotel Pvt. Ltd. (for short "LSPH") on 27.05.1972 and thereafter, incorporated the Lake Palace Hotels & Motels Pvt. Ltd. (for short "LPHM") on 02.03.1963 as family concerns/companies under the provisions of the Companies Act, 1956. Maharana Bhagwat Singh incorporated the Lake Shore Palace Hotel Pvt. Ltd. (for short "LSPH") on 27.05.1972 and thereafter, incorporated the Lake Palace Hotels & Motels Pvt. Ltd. (for short "LPHM") on 02.03.1963 as family concerns/companies under the provisions of the Companies Act, 1956. The registered offices of LSPH & LPHM are situated at City Palace, Udaipur, Rajasthan. LSPH is the holding company of LPHM. LSPH owns and/or holds 49.5% shares of LPHM. The main assets of LSPH are the assets of LPHM, which primarily owns heritage properties of historical importance. On 22.04.1983, partition suit along with application for Temporary Injunction was filed by the plaintiff-Shri Mahendra Singh before the court of District Judge, Udaipur against following defendants: 1. Maharana Bhagwat Singh (father) 2. Smt. Sushila Kumari (mother) 3. Rajmata Virad Kunwar (grand mother) 4. Shri Arvind Singh Mewar (brother)(personal capacity) 3. Thereafter, on 08.05.1984, the plaintiff filed an application under Order 1 Rule 10 of the C.P.C. for impleadment of defendants No. 5 to 12 including the companies LPHM and LSPH, in the suit. The said application was allowed on 12.10.1984. Maharana Bhagwat Singh died on 03.11.1984. He had three children, namely, Shri Mahendra Singh, Smt. Yogeshwari Kumari and Shri Arvind Singh. He left behind his Will dated 15.05.1984. Under the Will, Shri Arvind Singh and one Shri A. Subramaniyam were appointed as Executor of the Will. The High Court granted probate of the Will vide order dated 13.11.1987. The appeal was filed against the order granting probate, which was dismissed by the Division Bench of this Court on 12.05.1993. The SLP, too, was dismissed by Hon'ble the Supreme Court on 09.05.1994. Meanwhile, Rajmata Virad Kunwar also died on 03.12.1984. The trial court decided applications for taking LRs of late Maharana Bhagwat Singh and Rajmata Virad Kunwar on 23.03.1985. The following parties were finally impleaded as defendants:- 1. LRs of Maharana Bhagwat Singh 1/1 Shri Arvind Singh 1/2 Shri A.Subramaniam 2. Sushila Kumari 3. LRs of Rajmata Virad Kunwar 3/1 Shri Mahendra Singh 3/2 Shri Arvind Singh 3/3 Yogeshwari Kumari 4. Shri Arvind Singh The applications for temporary injunction were decided by the trial court vide order dated 02.12.1985. The relevant portion of the said order reads as under:- "Shri Arvind Singhji shall render true and correct account of the suit-properties (immovable) which are in his possession/management/control duly audited by a Chartered Accountant. Shri Arvind Singh The applications for temporary injunction were decided by the trial court vide order dated 02.12.1985. The relevant portion of the said order reads as under:- "Shri Arvind Singhji shall render true and correct account of the suit-properties (immovable) which are in his possession/management/control duly audited by a Chartered Accountant. These accounts must be submitted after every year and the account of the above immovable properties from the date of the institution of the application i.e. from 22.4.1983 be submitted in the court as per the above order within 3 months from today. Thereafter he will continue to submit the above accounts every year. Defendant No. 1- servants are further restrained from disposing of and/or alienating or otherwise dealing with the suit property till the decision of the suit." 5. Three appeals were filed by Shri Arvinid Singh against the order dated 02.12.1985 and cross-objections were filed by Shri Mahendra Singh against the rejection of his prayer in respect of appointment of Receiver. Two more appeals were filed by Shri Mahendra Singh and Smt. Sushila Kumari against the order dismissing their application under Order 40 Rule 1 of the C.P.C. All these appeals were decided by the High Court vide common order and judgment dated 11.06.1993. The relevant operative portion of the said judgment reads thus:- "When there is no sufficient evidence on record to show that the suit-properties in question are transferred or mis-managed by Shri Arvindsingh or there is no imminent danger from the side of Shri Arvindsingh since 1983 till now. The suit itself will be decided within six months, therefore, there is no justification now to appoint the receiver for these properties left by Maharana Bhagwatsingh or the properties declared by late Maharana Shri Bhagwatsingh in his declaration in 1969 and 1971. Further while major part of the properties specified in the declaration before the income-tax were transferred even before filing of the suit and those transferees are not made parties in the application for appointment of receiver. Thus, I find no justification for appointment of receiver. However, to safeguard the interest of the plaintiff, direction of the learned District Judge will be modified suitably hereinafter. Learned District Judge has issued directions referred to above in his order dated 2.12.85. He has restricted the directions only to immovable properties. Thus, I find no justification for appointment of receiver. However, to safeguard the interest of the plaintiff, direction of the learned District Judge will be modified suitably hereinafter. Learned District Judge has issued directions referred to above in his order dated 2.12.85. He has restricted the directions only to immovable properties. Why he had restricted his directions only for immovable properties, no reason or justification has been given. Similarly, no reason has been given as to why Shri Arvindsingh has not rendered the true and correct account of the income arising out of these immovable and movable properties, therefore, in the interest of justice it is directed that Shri Arvindsingh shall render true and correct account of the suit properties i.e. immovable and movable properties, which are in his possession, management and control. He should also render the true and correct account of the income arising out of these properties since 1983 and onwards. It is further directed that Shri Arvindisingh will allow the access of Shri Mahendrasingh to the account maintained in respect of income arising out of immovable and movable properties, which are in possession and control of Shri Arvindsingh, as and when Shri Mahendrasingh wants to see the accounts of income of these properties, maintained by the executors. He should file the true and correct account of income arising out of these properties duly audited by the chartered Accountant in the trial court within two months from the date of this order. Thereafter he will contuse to submit the above account every year by end of 'May'. It is further ordered that Shri Arvindsingh is an Executor of the Will of Maharana Bhagwatsingh (defendant No. 1), his agents servants or officers are further restrained from disposing and/or alienating or otherwise dealing with the suit-properties till decision of the suit." 6. The present application has been moved by Smt. Yogeshwari Kumari, the daughter of Maharana Bhagwat Singh and the sister of non-applicant No. 1 Shri Arvind Singh and plaintiff/non-applicant No. 2-Shri Mahendra Singh for clarification of the above order dated 11.06.1993 alleging therein that Shri Arvinid Singh in his capacity as the Chairman and Managing Director of the Company LPHM & LSPH is in his possession/management/control of the properties, namely, Jag Mandir, Fateh Prakash Palace, Garden Hotel and Shiv Niwas Palace, which are the part of the suit properties mentioned in the Schedule annexed to the plaint. However, he is planning to alienate the said property to the Indian Hotels Company Ltd. (IHC) i.e. the Taj Group, by granting the Taj Group long term lease for 25 years and the same is, therefore, in the violation of the order dated 11.06.1993 passed by this Court. Accordingly, the clarification has been sought that Shri Arvinid Singh be restrained from disposing of or alienating the property "in any capacity whatsoever". Meaning thereby that, it should be clarified that the direction was issued to Shri Arvind Singh not only in his personal capacity but also in his capacity as Chairman and Director of the Company. 7. While seeking the said clarification, Shri J.P. Joshi, Senior Advocate along with Shri Mr. Siddharth Joshi, Mr. Mrinal Mandal, Mr. M.K. Mishra submitted that this Hon'ble Court vide its order dated 11.06.1993 has upheld the injunction order granted by the learned trial court and restrained the appellant-Shri Arvind Singh, his agents, officers or servants from disposing of and/or alienating or otherwise dealing with the suit properties till the decision of the suit. However, the appellant-Arvind Singh under the pretence that he, as the Chairman and the Managing Director of the companies LSPH & LPHM, has expressed that he is not bound by the said order dated 11.06.1993 and is proceeding to alienate and/or is otherwise dealing with the said properties by giving them on long lease/complete management to IHC-Taj Group. It was contended that the fact that the said order applied to Shri Arvind Singh even in his capacity as the Director of the Company was evident from the fact that while declining relief to Shri Mahendra Singh for appointment of receiver, this Hon'ble Court has taken precaution to see that the properties were preserved till the suit was finally decided and had accordingly, modified the order of the trial court in the following terms:"It is further ordered that Shri Arvind Singh is an Executor of the Will of Maharana Bhagwat Singh (defendant No. 1), his agents servants or officers are further restrained from disposing and/or alienating or otherwise dealing with the suit properties till decision of the suit." 8. It was further contended that this was the only remedy available to the applicant and the necessity for seeking clarification has arisen only because of the conduct of the respondent No. 1 who under the shelter of the companies intends to alienate the suit properties by taking a position that the companies have not been injuncted by the Hon'ble Court from alienating the properties. It was further contended that the applicant through this application wants to emphasis that injunction order had been granted to preserve and protect the suit properties and injunction is in relation to the suit property and not in relation to individuals. Thus, suit properties are required to be preserved during pendency of the suit irrespective of the fact whether those properties are under the management control and possession of respondent No. 1 or indirectly held by him through companies and this is the true purport of the order passed by the Hon'ble High Court dated 11.06.1983 which is required to be explained in the present circumstances. It was further contended that respondent No. 1 has no intention to part with the property and he wants to cling on to the properties which are being held by him even as an executor of the Will. Moreover, the respondent No. 1 has been taking contradictory stands. When it comes to giving benefits under the Will, he takes a position that there is an injunction order restraining him from alienating the property or dealing with the property in any manner whatsoever but when it comes to alienating the property to third party by creating third party rights, he takes a position that the said injunction order does not prohibit him or the companies in which he is Managing Director from alienating the properties or creating third party rights. It was, therefore, submitted that in view of the contrary stand it has become imperative for the court to explain the true and correct purport of the order. 9. Shri M.S. Singhvi, Senior Advocate along with Mr. Arun Bhansali, Mr. Aslam Naushad, Mr. Ramit Mehta filed their reply to the application and submitted: 1. The application for clarification is not maintainable because the order was very specific and unambiguous. The Court had categorically confined the scope of injunction against the estate of original defendant No. 1 Maharana Bhagwat Singhji. 2. Arun Bhansali, Mr. Aslam Naushad, Mr. Ramit Mehta filed their reply to the application and submitted: 1. The application for clarification is not maintainable because the order was very specific and unambiguous. The Court had categorically confined the scope of injunction against the estate of original defendant No. 1 Maharana Bhagwat Singhji. 2. The application is a gross abuse of the process of the Court as the order dated 11.06.1993 was passed 19 years ago. The present application has been filed by Smt. Yogeshwari Kumari under the garb of seeking clarification/modification, which amounts to review and is accordingly not maintainable. 3. The applicant is guilty of concealment of material facts. It has not been brought to the notice of the Court that applicant had filed an application under Order 39 Rule 1 and 2 of the C.P.C seeking injunction against the non-applicant No. 1 qua the same property, which are also subject matter of the present application. Secondly, the applicant has not mentioned that the name of defendants No. 5 to 12 were deleted from the array of parties from the suit and that she herself was one of the applicants to the application which resulted into passing of the order dated 01.08.1994 whereby the defendants No. 5 to 12 were deleted. It was contended that the cumulative effect of the orders dated 18.09.1993 and 01.08.1994 is that the properties transferred to the defendants No. 5 to 12 which includes LPHM and LSPH are no more suit properties. Hence, the application should be dismissed for not coming to the Court with clean hands. 4. Further, the plaintiff Shri Mahendra Singh moved an application under Section 11 of the Rajasthan Court Fees and Suit Valuation Act raising objection qua the court fee. The court dismissed the same and held that the plaintiff was only claiming the share from the sale/transfer of properties. Thus, the plaintiff himself is not claiming the said property in the suit, whereas, the applicant being defendant is claiming the suit property. It was further contended that the applicant had sought clarification/modification regarding the properties named Jag Mandir, Fateh Prakash Palace, Garden Hotel and Shiv Niwas Palace. Thus, the plaintiff himself is not claiming the said property in the suit, whereas, the applicant being defendant is claiming the suit property. It was further contended that the applicant had sought clarification/modification regarding the properties named Jag Mandir, Fateh Prakash Palace, Garden Hotel and Shiv Niwas Palace. It is submitted that the properties Jag Mandir and Garden Hotel were sold to the LPHM in 1963 and Fateh Prakash Palace was sold in the year 1972 to the LPHM and Shiv Niwas Palace was leased to the LSPH in the year 1978 for 99 years by Maharan Bhagwat Singh. The said properties having being sold/transferred long before filing of the suit on 22.04.1983, and the said properties not being subject matter of the suit, no relief can be sought by the applicant in the present proceedings. That properties Jag Mandir, Fateh Prakash Palace and Garden Hotel are properties of LPHM and Shiv Niwas Palace is on 99 years' lease with LSPH as stated above and the same are not the part of the suit properties though mentioned in the Schedule annexed to the plaint and on appeal being filed by the respondent No. 1 as Executor of the Will of Maharana Bhagwat Singh, and other appeals, this Hon'ble Court vide order dated 11.06.1993 with slight modification in the direction had dismissed all the appeals. This Hon'ble Court clearly noticed the status of properties as mentioned in the suit i.e. (a) properties which do not belong to Maharana Bhagwat Singh on 22.04.1983, (b) properties which belong to public charitable trust settled before 22.04.1983, (c) properties which belong to Government of Rajasthan and Government of India on 22.04.1983 and (d) properties which are included in the estate of deceased Maharana Bhagwat Singh. The Hon'ble Court dealt with the aspect whether on each nature of property whether receiver can be appointed and gave an answer in the negative. It is therefore, implied that the said directions were issued only to Shri Arvind Singh and not to the Chairman and Director of the Company nor the order can be understood to be passed against these properties, which were the properties of LPHM and LSPH. It is therefore, implied that the said directions were issued only to Shri Arvind Singh and not to the Chairman and Director of the Company nor the order can be understood to be passed against these properties, which were the properties of LPHM and LSPH. It was further contended that these properties are owned by/is on lease with the companies and the decision regarding the said properties are taken by the respective Board of Directors of the said companies, which are in the best interest of the said companies. 5. The plaintiff-Shri Mahendra Singh filed an application under Order 39 Rule 2A alleging therein that the appellant has executed lease-deed on 23.04.1992 in respect of the property of LPHM and therefore, it has violated the Temporary Injunction granted against him. This application was rejected by the trial court vide judgment dated 02.12.1998 holding there in that the property w7hich has been leased out belongs to LPHM and not to the appellant and therefore, the injunction granted by the trial court is not binding on the company. The order dated 02.12.1998 has attained finality. It was further submitted that even on merits the applicant is not entitled to the clarification as it runs beyond the scope of the suit inasmuch as at the time of final disposal of the suit, the trial court cannot make the order in respect of the properties of the companies as the companies have been deleted from the array of the defendants in the original suit and that in fact these companies were not parties at any stage in the application for Temporary Injunction including Civil Misc. Appeal No. 84/1986. While deciding the appeal, vide judgment dated 11.06.1993, this Court has categorically held that in the absence of the transferees of Maharana Bhagwat Singh as parties to the application, no direction can be issued against those transferees. Subsequent to the judgment of this Court, the transferees were even deleted from the array of the defendants in the original suit as well. Therefore, when no direction can be given at the time of decision of the suit, interim direction as prayed for by the applicant in the form of clarification is beyond the scope of the suit. It was further contended that the status of the company is different vis-a-vis the Managing Director. Therefore, when no direction can be given at the time of decision of the suit, interim direction as prayed for by the applicant in the form of clarification is beyond the scope of the suit. It was further contended that the status of the company is different vis-a-vis the Managing Director. Managing Director is only one of the members of the Board which manages the company. Learned counsel for the respondent No. 1 concluded his argument by stating that it was abundantly clear from the order dated 11.06.1993 that directions were issued only against respondent No. 1 in his capacity as Executor of Will and not in any other capacity. 10. Finally, the learned counsel for the appellant in rebuttal submitted that the objections taken by the respondent No. 1 with regard to suppression of facts was misconceived as the applicant had duly mentioned the facts in para 26 of their application. Further, the objection of the respondent No. 1 that the application under Section 11 of the Rajasthan Court Fees and Suit Valuation Act, wherein, respondent No. 2 had made a concession that he is not seeking a declaration in relation to property already alienated and is not claiming any relief for setting aside the alienation is binding on the defendants and no clarification can be given, is misconceived as in the suit for partition, all the parties were plaintiffs as well as defendants and therefore, any concession given by plaintiff cannot bind the defendants. The defendant has a separate right. Also, the application under Order 6 Rule 16 of the C.P.C. filed by the respondent No. 1 to strike off of the suit properties from the pleadings is still pending and till as such time, the said properties are struck out from the plaint, they continue to be the suit property; and prayed for acceptance of the application for clarification. 11. Reply was also filed by non-applicant No. 2, Shri Mahendra Singh, stating therein that Shri Arvind Singh is wrongfully in control of the said companies and the injunction of this Hon'ble Court dated 11.06.1993 is applicable on him in every capacity but at the same time submitted that applicant Smt. Yogeshwari Kumari has not put forward any claim to her share in the family estate. Over the years, no such claim has been made by her before the trial court. Over the years, no such claim has been made by her before the trial court. The partition suit was filed on 22.04.1983, over which, the prevailing law is applicable and that the trial court has to only ratify an HUF that has been in existence for decades. Shri Pushpendra Singh Bhati, learned counsel for the non-applicant No. 2-Shri Mahendra Singh, contended that the non-applicant No. 1 cannot take the plea that Company is not a party as in the argument raised before this Court, the Company is being duly defended through non-applicant No. 1, Shri Arvind Singh himself; and that in the interest of justice and in fair play, the property should be protected from alienation which was the purpose of the order dated 11.06.1993 in its true letter and spirit. 12. After hearing the learned counsel for the parties as also going through the order and judgment dated 11.06.1993 which is sought to be clarified/modified as also the other various documents, following important facts have emerged with regard to the status of the properties mentioned in clause (c) of the prayer in the present application i.e. before filing of the partition suit on 22.04.1983:- (a) The Lake Palace Hotels and Motels Private Ltd. (LPHM) was incorporated on 02.03.1963; (b) The Late Shore Palace Hotel Pvt. Ltd. (LSPH) was incorporated on 27.05.1972. (c) The properties i.e. Jag Niwas (Lake Palace Hotel), Jag Mandir, Garden Hotel were sold to LPHM on 25.05.1963 and Fateh Prakash Palace and Banshi Ghat to Pipli Ghat were sold to LPHM on 06.05.1972. Shiv Niwas Palace was leased out for 99 years to LSPH by Maharana Bhagwat Singh on 14.12.1978. 13. It is evident from the above that these properties already stood transferred before filing of the suit. This Court noticed the said fact and accordingly refused to appoint a Receiver. The other facts which have emerged are:- (i) the LPHM was arrayed as one of the defendant No. 5 and the Lake Shore Palace Hotel (LSPH) was impleaded as respondent No. 5 & 6 in pursuance to an application under Order 1 Rule 10 and Order 6 Rule 17 of the C.P.C. vide order dated 12.10.1984. The other facts which have emerged are:- (i) the LPHM was arrayed as one of the defendant No. 5 and the Lake Shore Palace Hotel (LSPH) was impleaded as respondent No. 5 & 6 in pursuance to an application under Order 1 Rule 10 and Order 6 Rule 17 of the C.P.C. vide order dated 12.10.1984. (ii) Thereafter, after almost one year on 19.09.1985, another application was filed by Shri Arvind Singh and Shri A. Subramaniyam, i.e. Executors of the Will under Section 11 of the Court Fees and Suit Valuation Act objecting that in the amended plaint, suit valuation has not been mentioned and proper court fee has also not been given by the plaintiff. The said application was rejected by recording the finding that the plaintiff-Shri Mahendra has not sought cancellation of any sale or any document and has simply prayed in para No. 35(f) of his plaint that the properties declared to various trust companies or person be declared as property of the Hindu Undivided Family (HUF) and that he be given the share received by sale, transfer or otherwise by the HUF property. After passing of the said order dated 18.09.1983, an application under Order 1 Rule 10(2) of the C.P.C. was filed by defendants No. 1 (Shri Arvind Singh), 3 to 12D including 3/3 (Smt. Yogeshwari Kumari-the application herein) for deleting the names of defendants No. 5 to 12. The said application under Order 1 Rule 10(2) of the C.P.C. was allowed by the trial court on 01.08.1994. While allowing the said application, the trial court concluded that even if the plaintiff succeeds in the suit, still the title and possession of the properties received by defendants No. 5 to 12 will not be affected and consequently, the defendants No. 5 to 12 were ordered to be deleted. A copy of this order has been placed on record as Annexure-R/5 by non-applicant No. 1 Shri Arvind Singh along with his reply. The said order dated 01.08.1994 was challenged before the High Court vide Revision Petition No. 815/1994. The said revision petition was dismissed vide order dated 12.05.2000. Thus, the order deleting the name of defendants No. 5 to 12, which includes LPHM & LSPH was upheld and has attained finality. 14. The said order dated 01.08.1994 was challenged before the High Court vide Revision Petition No. 815/1994. The said revision petition was dismissed vide order dated 12.05.2000. Thus, the order deleting the name of defendants No. 5 to 12, which includes LPHM & LSPH was upheld and has attained finality. 14. From the above facts, it is evident that as on date, the name of Company stands deleted from the array of defendants in the original suit. 15. In the case of Western coalfields Ltd. v. Special Area Development Authority, Korba & Anr., reported in AIR 1982 Supreme Court 697(1) after taking into consideration various judgments rendered by Hon'ble the Apex Court held in no uncertain terms that the Company was a separate entity from the Central Government. Observation in para 20 are as under:- "The short answer to this contention is that even though the entire share capital of the appellant companies has been subscribed by the Government of India it cannot be predicated that the companies themselves are owned by the Government of India. The companies, which are incorporated under the Companies, have a corporate personality of their own, distinct from that of the Government of India. The lands and buildings are vested in and owned by the companies the Government of India only owns the share capital. In Rustom Cavasjee Cooper v. Union of India (1970) 3 SCR' 530, 555: ( AIR 1970 SC 564 at p. 584) (The Banks Nationalisation case) it was held: "A company registered under the Companies Act is a legal person, separate and distinct from its individual members. Property of the Company is not the property of the shareholders. A shareholder has merely an interest in the Company arising under its Articles of Association, measured by a sum of money for the purpose of liability, and by a share in the profit." 16. In the case of Heavy Engineering Mazdoor Union v. The State of Bihar, reported in (1969) 3 SCR 995 , wherein the Heavy Engineering Corporation Limited was incorporated under the Companies Act and its entire share capital was contributed by the Central Government, it was held that the Company has a separate existence and the law recognises it as a juristic person separate and distinct from its members. In the said case, entire shares were held by the Central Government and the President. In the said case, entire shares were held by the Central Government and the President. Still, was held that the same do not make any difference to the position of the Company as a separate juristic person. 17. Hon'ble the Apex Court in the case of Khetrabasi Biswal v. Ajaya Kuamr Baral & Ors., reported in (2004) 1 SCC 317 held in no uncertain terms that non-joinder of necessary party vitiates the very order passed and amounts to a nullity. Para 6 of the said judgment reads thus:- "6. The procedural law as well as the substantive law both mandates that in the absence of a necessary party, the order passed is a nullity and does not have a binding effect. 18. The argument of the learned counsel for the applicant, Shri J.P. Joshi and learned counsel for the non-applicant No. 2- plaintiff, Dr. Pushpendra Singh Bhati that the Company is represented through Shri Arvind Singh, who is the Chairman and Managing Director, does not help. Non-applicant No. 1, Shri Arvind Singh has been arrayed as a party in his individual capacity. Even, before this Court, Shri Arvind Singh is represented in his personal capacity. In any case, it is the Company which owns the property and not the Managing Director or the Director or the shareholders. 19. Non-applicant No. 1, Shri Arvind Singh has been arrayed as a party in his individual capacity. Even, before this Court, Shri Arvind Singh is represented in his personal capacity. In any case, it is the Company which owns the property and not the Managing Director or the Director or the shareholders. 19. As per Section 2(26) of the Companies Act, 1956, the definition of a "managing director" is as under:- ""Managing director" means a director who, by virtue of an agreement with the company or of a resolution passed by the company in general meeting or by its Board of directors or, by virtue of its memorandum or articles of association, is entrusted with [substantial powers of management] which would not otherwise be exercisable by him, and includes a director occupying the position of a managing director, by whatever name called: [Provided that the power to do administrative acts of a routine nature when so authorised by the Board such as the power to affix the common seal of the company to any document or to draw and endorse and cheque on account of the company in any bank or to draw and endorse any negotiable instrument or to sign any certificate of share or to direct registration of transfer of any share, shall not be deemed to be included within substantial powers of management: Provided further that a managing director of a company shall exercise his powers subject to the superintendence, control and direction of its Board of directors;]" 20. A perusal of the above shows that the Managing Director is under the control and direction of its Board of directors which are further responsible to the Company. Thus, the Company, as already held above, is a separate entity and is a necessary party. 21. Hon'ble the Apex Court in the case of Mrs. Bacha F.Guzdar v. Commissioner of Income Tax, Bombay, reported in AIR 1955 SC 74 , while explaining the distinction between the 'company' and the 'shareholders' held as under: "A shareholder has got no interest in the property of the company though he has undoubtedly a right to participate in the profits if and when the company decides to divide them. The interest of a shareholder 'vis-a-vis' the company was explained in the 'Sholapur Mills Case'- 'Charanjit Lal v. Union of India', AIR 1951 SC 41 at pp. 54, 55(b). The interest of a shareholder 'vis-a-vis' the company was explained in the 'Sholapur Mills Case'- 'Charanjit Lal v. Union of India', AIR 1951 SC 41 at pp. 54, 55(b). That judgment negatives the position taken up on behalf of the appellant that a shareholder has got a right in the property of the company. It is true that the shareholders of the company have the sole determining voice in administering the affairs of the company and are entitled, as provided by the Articles of Association, to declare that dividends should be distributed out of the profits of the company to the shareholders but the interest of the shareholder either individually or collectively does not amount to more than a right to participate in the profits of the company. The company is a juristic person and is distinct from the shareholders. It is the company which owns the property and not the shareholders." In the case of Ranjeet Mal v. General Manager, Northern Railway, New Delhi & Anr., reported in AIR 1977 Supreme Court 1701 , Hon'ble the Apex Court justified the order of the High Court, vide which, the petition was dismissed because the Union of India was not made a party to the proceedings holding therein in para 7 as under:- 7. "The Union of India represents the Railway Administration. The Union carries administration through different servants. These servants all represent the Union in regard to activities whether in the matter of appointment or in the matter of removal. It cannot be denied that any order which will be passed on an application under Article 226 which will have the effect of setting aside the removal will fasten liability on the Union of India, and not on any servant of the Union. Therefore, from all points of view, the Union of India was rightly held by the High Court to be a necessary party. The petition was rightly rejected by the High Court." 22. Thus, it is settled proposition of law that company is a separate legal entity. Hence. No clarification which is against the provision of law can be given in the facts of the present case. As is evident, the properties were transferred before filing of the suit. They are the properties of the Company. The company stands deleted from the array of defendants. Hence. No clarification which is against the provision of law can be given in the facts of the present case. As is evident, the properties were transferred before filing of the suit. They are the properties of the Company. The company stands deleted from the array of defendants. Hence, no clarification qua the properties of the Company, which will bind the Company, can be passed in the absence of the Company. 23. Another reason why the prayer for clarification requires to be rejected is the finding of the High Court qua the status of the properties while refusing to appoint the Receiver. The relevant portion of the order dated 11.06.1993 passed by High Court reads as under:- "The suit was filed in the year 1983 and in the suit as well as in the application, the allegations of mismanagement and transfer was against the defendant No. 1, that is, late Maharana Bhagwatsingh and not against Shri Arvindsingh. In compliance with the directions of the learned District Judge in his order dated 2.12.85, Shri Arvindsingh has filed a list of properties and their position as on 22.3.83. The properties as enumerated in the plaint, have been shown in Four Schedules by Shri Arvindsingh. In Schedule-I, he has shown the properties, which do not belong to Maharana Bhagwatsingh on 22.3.83. In Schedule-II, he has shown the properties, which belong to public Charitable Trust settled before 22.3.83 i.e., before filing of the suit. In Schedule-III, the properties are shown which belong to the Government of Rajasthan or Government of India as on 22.3.83. In Schedule-IV he has shown the properties, which are included in the estate of deceased Maharana Bhagwatsingh. Thus, if we go-bye the different positions of those properties as shown, can a receiver be appointed in respect of all the properties whom in Annx.A and B of the Plaint ? Answer will be in negative, therefore, we deal with these categories of properties separately. The properties which were not belonged to Maharana Bhagwatsingh on 22.3.83 and transferred earlier from filing of the suit and the transferees are not made parties in the application for appointment of receiver. There is no question of appointment of receiver for such properties without hearing, the transferees that will be against the principles of natural justice. The properties which were not belonged to Maharana Bhagwatsingh on 22.3.83 and transferred earlier from filing of the suit and the transferees are not made parties in the application for appointment of receiver. There is no question of appointment of receiver for such properties without hearing, the transferees that will be against the principles of natural justice. The properties shown in Schedule-II, they were also settled before filing of the suit and transferees or alienates are not made parties in the application for appointment of receiver, therefore, without hearing the alienates or transferees concerned, no order of appointment of receiver can be made in the back of those transferees or alienates. The properties enumerated in Schedule-III, they belong to the Government of Rajasthan or Government of India, when the defendant has nothing to do with these properties and they belong to the State Government or the Central Government, there is no question of appointment of receiver for such properties. Now, we left with the properties specified in Schedule-IV, which are included in the Estate of Maharana Bhagwatsingh. They are part of the City Palace Udaipur, Gassghar, Gaushala, Motor Garage, Mohan Mandir, Natni Chabutra, Nahar Magra Palace, Keshar Bagh, Saheloin ki Bari and near Shitlamataji Arshi Vilas, Water Palace and the properties left by Maharana Bhatwatsingh" 24. The court specifically held that property in Schedule I, II & III stands already transferred and further held that no order could be passed qua these properties in the absence of the Transferees. With respect to the other properties for which clarification is being sought, i.e. Jag Niwas (Lake Palace Hotel), Jag Mandir and Garden Hotel, they were sold to LPHM on 25.05.1963 and Fateh Prakash Palace was sold to LPHM on 06.05.1972. Shiv Niwas Palace was leased out for 99 years to LSPH on 14.12.1978. Now, after the filing of the suit, both LPHM & LSPH stands deleted from the array of the defendants. Therefore, applying the same test qua these properties as applied qua the properties in Schedule I, II & III by the order dated 11.06.1993 sought to be clarified, it is not understood as to how an order can be passed now, qua the properties, which belong to the Company (LPHM & LSPH), in the absence of the Company (LPHM & LSPH). 25. 25. This Court can also not lose sight of the fact that plaintiff-Shri Mahendra Singh had filed an application under Order 39 Rule 2A read with Section 151 C.P.C. against non-applicant No. 1-Shri Arvind Singh stating that he had violated the order dated 02.12.1985 passed by the trial court by transferring some properties through execution of lease-deeds inspite of the fact that he and his agents, officers and servants were restrained from alienating and otherwise transferring the suit property till the decision of the suit. The Additional District Judge, Udaipur dismissed the said application vide order dated 02.12.1998 and held that it cannot be said that the disputed property was transferred by Shri Arvind Singh in his personal capacity. It was observed that in the case, in which, order dated 02.12.1985 was passed, LPHM was not a party and as such, there is no question of any contempt being committed by Shri Arvind Singh while acting as Chairman of LPHM. The said order dated 02.12.1998 was not challenged by the plaintiff. The same has attained finality. The argument of learned counsel for the applicant that the order dated 02.12.1998 is not binding on the applicant-Smt. Yogeshwari Kumari as the application was moved by plaintiff-Shri Mahendra Singh and not by her and that the said order was passed under Order 39 Rule 2A of the C.P.C. which are proceedings of contempt, cannot be sustained. The parties to the suit are bound by the findings of orders passed during the pendency of the suit and which have attained finality. 26. In view of the facts & circumstances and discussion, as above, the application for clarification/modification of the order dated 11.06.1993 is dismissed. This Court need not express any opinion upon any other issue raised herein as the conclusion arrived at by this Court, as the result of the forgoing discussion, is sufficient to dismiss the application.Application for clarification dismissed. *******