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2014 DIGILAW 1671 (BOM)

Samar Vijaykumar Pupala v. Shalini Pratap Hambir

2014-07-31

M.S.SONAK, MOHIT S.SHAH

body2014
JUDGMENT (PER M.S.SONAK, J.): 1] Heard the learned counsels for the parties. With their consent, the Appeal is taken up for final disposal. 2] This Appeal is directed against the order dated 17 April 2014 passed by the learned Single Judge of this Court revoking the leave granted under Clause XII of the Letters Patent and returning the plaint for presentation before the appropriate court. 3] The brief facts and circumstances in which the impugned order came to be passed are as follows: (A) By a Deed of Partnership dated 4 January 1971 the following persons constituted themselves into a partnership firm to function under the name and style of M/s. Hotel Anarkali (“the said firm”) (I) Vijaykumar Narsingrao Pupala (Appellant – Plaintiff's father) (II) Surendra Narsingrao Pupala (Appellant – Plaintiff's uncle) (III) Pratap Ramchandra Hambir (husband of Respondent / Defendant No.1) (B) By Registered Indenture dated 30 March 1971, the said firm purchased property at Mahableshwar, Satara and constructed thereon structures, which form Hotel Anarkali (the land together with the structures is referred to as 'the said property'). (C) Consequent upon death and retirement of partners, the said firm underwent reconstitution inter alia in the year 1977, 1982, 1992 and finally in the year 2003. Clause 19 of the Deed of Reconstituted Partnership dated 16 March 2003, reads thus : “If any of the partners die/dies during the continuance of the partnership, one or more members of the legal heirs shall have the right to be automatically admitted as a partner/s or for the benefits of the partnership depending upon the age of the legal heir.” (D) One of the partners, i.e. Shri Pratap Ramchandra Hambir expired on 2 May 2003. In terms of clause 19 as aforesaid, Respondent No. 1 i.e. Shalini Pratap Hambir was admitted as a partner, in place of her deceased husband. The constitution of the firm as on 17 May 2003 was therefore as follows:- Shri Vijaykumar N. Pupala and ] Mrs. Madhu V. Pupala ] 50% Shalini Pratap Hambir 50% (E) On 1 February 2007, Appellants parents Shri Vijaykumar N. Pupala and Mrs. Madhu V. Pupala expired in a road accident. The constitution of the firm as on 17 May 2003 was therefore as follows:- Shri Vijaykumar N. Pupala and ] Mrs. Madhu V. Pupala ] 50% Shalini Pratap Hambir 50% (E) On 1 February 2007, Appellants parents Shri Vijaykumar N. Pupala and Mrs. Madhu V. Pupala expired in a road accident. (F) On 26 March 2007, the Appellants consistent with clause 19 as aforesaid, gave notice to Respondent No. 1 to complete the formalities for the formal reconstitution of the firm; (G) Between 26 March 2007 and 19 March 2008, several meetings were held and correspondence exchanged in the matter of completion of formalities; (H) On 19 March 2008, Respondent Nos. 1 to 3 executed Deed of Assignment purporting to assign their 50% undivided share in : (i) The land situate at Mahableshwar, Satara; (ii) The structures known as Hotel Anarkali existing on the aforesaid land; and (iii) The running business of Hotel Anarkali along with the goodwill of the said business (all the aforesaid collectively referred to as “the said premises”) (I) Upon the Appellants acquiring knowledge about the assignment as aforesaid, meetings were held, correspondence exchanged and mediation attempted. Ultimately, the Appellants instituted Civil Suit No. 1468 of 2008 in this Court on 30 April 2008, on the ground that the substantial and material part of cause of action had arisen in Mumbai. However, since the said property was situated in Satara, outside the territorial limits of the Original Jurisdiction of this Court, leave was obtained under Clause XII of the Letters Patent prior to or at the stage of institution of the suit; (J) Written statements were filed by Respondent Nos. 1 to 3 on 13 April 2011 and by Respondent Nos. 4 to 6 on 18 April 2011. On 16 June 2011, Respondent Nos. 4 to 6 took out Chamber Summons No. 969 of 2011 seeking revocation of leave under Clause XII of the Letters Patent, primarily on the ground that this Court did not have territorial jurisdiction to entertain the suit; (K) By order dated 17 April 2014 ('impugned order'), the learned Single Judge has made the Chamber Summons absolute in terms of prayer clauses (a) and (b); revoked the leave under Clause XII of the Letters Patent and ordered the return of the plaint for presentation before the appropriate court. (L) As indicated earlier, this Appeal by the Appellants/ Plaintiffs is directed against the aforesaid impugned order dated 17 April 2014. 4] Mr. D. D. Madon, the learned Senior Advocate for the Appellants – Plaintiffs made the following submissions in support of the Appeal: (A) That the Chamber Summons taken out by Respondent Nos. 4 to 6 was premised on the basis that the said property was beyond the territorial jurisdiction to which the Original Jurisdiction of this Court extends and therefore, the suit was not maintainable in terms of Sections 16 and 17 of the CPC. Mr. Madon submitted that in terms of Section 120 of the CPC, the provisions of Sections 16 and 17 of the CPC were specifically made inapplicable to the Chartered High Courts, which includes the High Court of Judicature at Bombay. Accordingly, the Chamber Summons as taken out, was misconceived and ought to have been rejected. (B) The learned Single Judge, by focusing upon the number of reliefs which made reference to the said property, has incorrectly regarded the suit as being 'suit for land'. In fact, upon a meaningful reading of the plaint in its entirety, it is clear that the Appellants have primarily and substantially sued for enforcement of their rights as guaranteed by the contract of partnership. Mr. Madon submitted that in this case there was absolutely no dispute as to the title of the Appellants to the said property, or for that matter the other assets of the said firm. Further, Mr. Madon submitted that the bank accounts and the branch office of the firm is located at Mumbai. Therefore, there was no case made out by Respondent Nos. 4 to 6 to seek revocation of leave. (C) The Chamber Summons seeking revocation of leave was admittedly filed by Respondent Nos. 4 to 6 after delay of 3 years and 45 days. Such inordinate delay has been condoned by the learned Single Judge without assigning any reasons. 5] Mr. Girish Godbole, learned counsel for Respondent Nos. 4 to 6 has however submitted that from the perusal of prayer clauses (b) to (g) of the plaint, it is clear that the suit as filed, is a 'suit for land' and consequently, since the land is situate outside Mumbai, no leave under Clause XII of the Letters Patent could at all have been granted in this case. Mr. 4 to 6 has however submitted that from the perusal of prayer clauses (b) to (g) of the plaint, it is clear that the suit as filed, is a 'suit for land' and consequently, since the land is situate outside Mumbai, no leave under Clause XII of the Letters Patent could at all have been granted in this case. Mr. Godbole placed reliance upon the decision of Mahajan, J. in the case of M/s. Moolji Jaitha and Co. vs. The Khandesh Spinning and Weaving Mills Co. Ltd. (AIR 1950 Federal Court 83) and the decision of the Supreme Court in case of Adcon Electronics Pvt. Ltd. vs. Daulat & Anr. ( 2001 (7) SCC 698 ), to submit that a suit which seeks determination of title to land; possession of land, or other reliefs which would directly affect the title to or possession of the land are covered by expression 'suits for land'. By reference to prayer clauses (b) to (g) in the plaint, Mr. Godbole submitted that in the event the same are granted, then both the title and possession of Respondent Nos. 4 to 6 to the said property would be directly affected. On the aspect of condonation the delay Mr. Godbole submitted that the records would bear out, that from the date of the institution of the suit until shortly before the Chamber Summons was taken out, settlement talks were in progress between the parties. Upon failure of such talks, the Chamber Summons was taken out. Consequently the delay, if any, in filing the same was adequately explained. 6] Mr. Gauraj Shah, learned counsel for Respondent Nos. 1, 2 and 3 submitted that at the stage of grant or revocation of leave, the Court is required to go by the averments contained in the plaint and the defence is clearly irrelevant. The plaint, proceeds on the erroneous basis that the said firm was in existence on the date when the Deed of Assignment dated 19 March 2008 came to be executed by Respondent Nos. 1 to 3. Mr. Shah submits that in fact, upon the simultaneous demise of the parents of the Appellants on 1 February 2007, there was no 'firm' in existence, as there could be no firm comprising only a single partner. Further, Mr. 1 to 3. Mr. Shah submits that in fact, upon the simultaneous demise of the parents of the Appellants on 1 February 2007, there was no 'firm' in existence, as there could be no firm comprising only a single partner. Further, Mr. Shah submitted that since the Appellants claim to have been automatically admitted as partners of the said firm, there was no question seeking any declaration in terms of prayer clause (a) of the plaint. Mr. Shah also adopted the submissions made by Mr. Godbole in defence of the impugned order. 7] We have considered the rival contentions and perused the material on record. 8] In the affidavit supporting the Chamber Summons, the case made out is that most of the reliefs pertain to the said property at Mahableshwar, which is beyond the territorial jurisdiction of this Court and therefore leave as granted, needs to be recalled. Such objection, obviously relates to the provisions contained in Sections 16 and 17 of the CPC. However, as pointed out by Mr. Madon, by virtue of Section 120 of the CPC, the provisions contained in Sections 16 and 17 of the CPC are incapable to Chartered High Court, in the exercise of their Original Civil Jurisdiction. Therefore, if this Court were to go by the averments in the affidavit supporting the Chamber Summons, then no case was made out for the recall of leave. 9] However, before the learned Single Judge as well as in the Appeal Court by reference to the reliefs in prayer clauses (b) to (g), submissions were made that suit as filed, is substantially, a 'suit for lands or other immovable property' and since again 'land or immovable property' is not situate in Mumbai, there was no question of grant of leave under Clause XII. The submission is based upon the peculiar wordings of Clause XII of the Letters Patent, which reads thus : “Original jurisdiction as to suits.- And We do further ordain that the said High Court of Judicature at Bombay, in the exercise of its ordinary original civil jurisdiction, shall be empowered to receive, try, and determine suits of every description, if, in the case of suits for land or other immovable property such land or property shall be situated, or in all other cases if the cause of action shall have arisen, either wholly, or in case the leave of the Court shall have been first obtained, in part, within the local limits of the ordinary original jurisdiction of the said High Court, or if the defendant at the time of the commencement of the suit shall dwell or carry on business, or personally work for gain, within such limits; except that the said High Court shall not have such original jurisdiction in cases falling within the jurisdiction of the Small Cause Court at Bombay, in which the debt or damage, or value of property sued for does not exceed one hundred rupees.” [Emphasis supplied] 10] In order to appreciate such submission, the key expression to be analysed is 'suit for land' as employed in Clause XII of the Letters Patent. This expression has been analysed in several decisions, including that of the Federal Court and the Supreme Court. 11] The Federal Court in the case of Moolji Jaitha (supra) speaking through Mahajan, J. has observed thus : “If an attempt is made to find a comprehensive definition of the phrase, it will eventually be discovered that it has created further complications. 11] The Federal Court in the case of Moolji Jaitha (supra) speaking through Mahajan, J. has observed thus : “If an attempt is made to find a comprehensive definition of the phrase, it will eventually be discovered that it has created further complications. I therefore content myself by saying that where the nature of the suit is such that in substance it involves a controversy about land or immovable property and the Court is called upon to decide conflicting claims to such property and a decree or order is prayed for which will bring about a change in the title to it, that suit can be said to be in respect of land or immovable property; but where incidentally in a suit, the main purpose of which or the primary object of which is quite different, some relief has to be given about land, the title to it not being in dispute in the real sense of the term, then such a suit cannot fall within the four corners of this expression. He added: “In my opinion, if the suit is for specific performance and a decree for possession of the land sold is claimed, such a suit would certainly be a suit for land; but if the suit is simpliciter for specific performance, i.e., for the enforcement of the contract of sale and for execution of a conveyance, in that event there can be no good ground for holding that such a suit is a suit for determination of title to land or that the decree in it would operate on the land.” [Emphasis supplied] 12] In the case of Adcon Electronics (supra), the Supreme Court after quoting and analysing the aforesaid passage from the decision of Mahajan, J. has observed thus:- “From the above discussion it follows that a “suit for land” is a suit in which the relief claimed relates to title to or delivery of possession of land or immovable property. Whether a suit is a “suit for land” or not has to be determined on the averments in the plaint with reference to the reliefs claimed therein; where the relief relates to adjudication of title to land or immovable property or delivery of possession of the land or immovable property, it will be a “suit for land”. We are in respectful agreement with the view expressed by Mahajan, J. in M/s.Moolji Jaithas case (supra)”. We are in respectful agreement with the view expressed by Mahajan, J. in M/s.Moolji Jaithas case (supra)”. 13] Applying the aforesaid analysis to the facts and circumstances of the present case, we find from the averments in the plaint that the suit as filed is primarily and substantially for the enforcement of the contracted terms of partnership including in particular those contained in Clauses 11(b), 14 and 19 of the Deed of Partnership dated 17 May 2003. 14] Clause 15 of the Partnership Deed provides that death or retirement of any of the partners shall not dissolve the firm and the surviving partner/s shall be entitled to continue to carry on the partnership business along with other person or persons. Clause 19 provides that if any of the partner/s die/dies during the continuance of the partnership, one or more members of the legal heirs shall have the right to be automatically admitted as partner/s for the benefit of the partnership depending upon the age of that legal heir. The legal heirs of the deceased will have to intimate in writing within three months of such death regarding the nomination of member/s to become a partner/s. After the expiry of period of three months or in case of intimation of refusal to join the firm before the expiry of period of three months, the partnership business and the property shall be taken over by the existing partners and they shall pay within six months from the death of the partner the net amount standing to the credit of the capital and current account and share and profit and loss, at the time of death to such legal heir with interest @ 12% on the unpaid balance. 15] Upon a meaningful reading of the plaint in its entirety, it does appear that the suit is for the purpose of seeking a declaration that the Appellants/ Plaintiffs are partners of the firm, in terms of clauses 15 and 19 of the Partnership Deed. Such declaration was necessary on account of the failure on the part of Respondents 1, 2 and 3 in completing procedural formalities. It appears to be the case of the Appellants / Plaintiffs that in terms of clause 19 as aforesaid, upon their furnish of intimation within the period prescribed, they have a right to be automatically admitted as partners of the firm. It appears to be the case of the Appellants / Plaintiffs that in terms of clause 19 as aforesaid, upon their furnish of intimation within the period prescribed, they have a right to be automatically admitted as partners of the firm. The defence that there was no partnership in existence consequent upon the simultaneous demise of the parents of the Appellants / Plaintiffs is hardly relevant at the stage of either grant or revocation of leave. This is in fact the case of Mr. Gauraj Shah, learned counsel appearing for Respondent Nos. 1, 2 and 3. Further, this is what has been held by the Supreme Court in the case of Adcon Electronics (supra) (at paragraph 15), which is quoted above. 16] The reliefs in clauses (b) to (g) of the plaint are in the context of clauses 11(b) and 14 of the Deed of Partnership. Clause 11(b) provides that no partner shall without the previous consent of the other partners assign, mortgage or charge as share in the partnership or the assets or profits of the firm or any part thereof or make any other person a partner with him therein. Similarly, clause 14 provides that no partner shall assign, transfer, sale, mortgage, charge or otherwise deal with his share in the partnership firm or enter into any sub partnership in every person or persons without previous written consent of other partners and any partner acts contrary, such actions shall not be binding upon the other partners or the partnership assets. 17] Further, in order to appreciate the true scope and import of the reliefs in prayer clauses (b) to (g) of the plaint, most of which concern the Deed of Assignment and Conveyance dated 19 March 2008, it is necessary to make reference to the actual Deed of Assignment and Conveyance dated 19 March 2008. 18] By the aforesaid Deed of Assignment, Respondent Nos. 1 to 3 have purported to assign their one half undivided share in 'the said premises' to Respondent nos. 4 to 6. 18] By the aforesaid Deed of Assignment, Respondent Nos. 1 to 3 have purported to assign their one half undivided share in 'the said premises' to Respondent nos. 4 to 6. The expression 'the said premises' as described in the Deed of Assignment, includes the following: (i) in the land situated at Village Mahableshwar, Taluka Mahabaleshwar, District Satara and which is more particularly described in the First Schedule hereunder written and hereinafter referred to as “the said land”; (ii) in the structures known as “Hotel Anarkali” existing on the said land and which are more particularly described in Second Schedule here under written and hereinafter referred to as “the said structures of Hotel Anarkali; and (iii) in the running business of “Hotel Anarkali” which has been run and managed from the said land and as structures of Hotel Anarkali with the goodwill of the said business. 19] The Deed of Assignment, in terms admits and acknowledges that the Appellants / Plaintiffs are entitled to the other half undivided share in 'the said premises'. The Deed acknowledges that the Appellants/ Plaintiffs had shown their willingness to become partners in the said firm but proceeds to state that on account of the conduct of the Appellants/ Plaintiffs, and the fact that there is no male member in the family of Respondent Nos. 1 to 3, it became impossible to accept the Appellants / Plaintiffs as partners in the said firm and continue the business of the firm smoothly. The Deed also acknowledges that the Appellants / Plaintiffs are in joint possession of 'the said premises.' The Deed also records that the recitals shall form an integral part of the instrument. 20] Therefore, if the reliefs in prayer clauses (b) to (g) are construed with reference to the contents of the Deed of Assignment, it is clear that the suit as filed, is primarily and substantially, for enforcing the various clauses of the contract of partnership. Even the Deed of Assignment, in respect of which reliefs have been sought for in the plaint, does not merely concern land or immovable property but rather it concerns 'the said premises'. As noted earlier, the expression 'the said premises' includes, apart from land and structure, the running business of Hotel Anarkali along with the goodwill thereof. Further, from the Deed itself, it is clear that neither Respondent Nos. 1 to 3 nor Respondent Nos. As noted earlier, the expression 'the said premises' includes, apart from land and structure, the running business of Hotel Anarkali along with the goodwill thereof. Further, from the Deed itself, it is clear that neither Respondent Nos. 1 to 3 nor Respondent Nos. 4 to 6 who claim through Respondent Nos. 1 to 3, have any issues with regard to one half undivided share of the Appellants / Plaintiffs, in so far as 'the said premises' are concerned. In fact there are admissions to the effect that the Appellants / Plaintiffs continue to both own and possess one half undivided rights to the said premises. Upon the meaningful reading of the plaint, it is apparent that the Appellants / Plaintiffs are basically protesting against foisting of Respondent Nos. 4 to 6 as partners in the said firm along with them, contrary to the terms of the partnership contract. Merely because there is reference to 'the said property' or the Deed of Assignment in prayer clauses (b) to (g) of the plaint, that by itself does not render the suit to be 'suit for land'. The primary and substantial object of the suit in the present case, is the enforcement of the terms of the Partnership contract. There may be reliefs which relate to 'the said property', but the same construed in the perspective indicated above, would be only incidental. There is no dispute as to the title or possession to 'the said property' in the real sense of the term. In such circumstances, we are of the opinion that the suit as filed cannot be regarded as being 'suit for land'. Accordingly, leave under Clause XII was rightly granted and Respondent Nos. 4 to 6 have not made out any case for revocation of the same. 21] In the plaint, the Appellants / Plaintiffs have averred that the said firm has its branch office in Mumbai. There is no traverse to these averments in the written statements filed by the Respondents. The averments in the plaint as also the reliefs, basically seek to enforce the rights of the Appellants / Plaintiffs qua the business of the said firm. In such a situation, the circumstance that the said firm has a branch office in Mumbai assumes relevance. There is no traverse to these averments in the written statements filed by the Respondents. The averments in the plaint as also the reliefs, basically seek to enforce the rights of the Appellants / Plaintiffs qua the business of the said firm. In such a situation, the circumstance that the said firm has a branch office in Mumbai assumes relevance. Therefore, irrespective of whether the suit as filed is a 'suit for land' or not, once it is the case of the Appellants / Plaintiffs that the said firm has immovable property within the local limits of the Original Jurisdiction of this Court, there was no case made out for revocation of leave under Clause XII of the Letters Patent. 22] In view of the aforesaid, we do not propose to go into the question as to whether sufficient cause was shown by Respondent Nos. 4 to 6 in taking out the Chamber Summons seeking revocation of leave after the expiry of a period of almost 3 years and 45 days, beyond the last date of limitation prescribed for the purpose. 23] In the result, the Appeal is allowed, the impugned order dated 17 April 2014 revoking leave under Clause XII of the Letters Patent is set aside and the Civil Suit No. 1468 of 2008 is restored to the file of the learned Single Judge against all the Defendants. 24] In the facts and circumstances, there shall be no order as to costs.