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Lakshmi Commercial Bank Ltd. Vs. Bengal National Textiles Mills Ltd. and Others - Court Judgment

SooperKanoon Citation
SubjectBanking;Limitation
CourtKolkata High Court
Decided On
Case NumberSuit No. 331 of 1984
Judge
Reported inAIR1992Cal278
ActsLimitation Act, 1963 - Sections 3(2) and 5
AppellantLakshmi Commercial Bank Ltd.
RespondentBengal National Textiles Mills Ltd. and Others
Appellant Advocate R.K. Khanna, Adv.
Respondent Advocate Girish Gupta, Adv.
Cases Referred(Lakshmi Commercial Bank Ltd. v. Bengal National Textile Mills Ltd.
Excerpt:
- .....date of the presentation of the plaint may be relevant but the leave when granted is nevertheless leave granted prior to the institution of the suit. 3. where by amendment of a plaint, a cause of action is altered or a new cause of action added, it is not a new suit but the old suit in a new form. in such a case, no amendment can be ordered if it requires leave to be granted under clause 12 of the lettes patent, at the time of the amendment. 4. it follows that leave under clause 12 of the letters patent cannot be granted in such a case, at any stage after the institution of the original suit. 5. but where a new party is added, the suit as regards the added party must be deemed to have been commenced on the date when he was so added. consequently, if the cause of action against the added.....
Judgment:
ORDER

1. This is an application made by way of Master's Summons on behalf of the named plaintiff in the suit. However, it is today an undeniable fact that the Lakshmi Commercial Bank Ltd. has merged into Canara Bank which is a nationalised Undertaking.

2. There are several prayers in the Summons. The suit was originally presented in 1984 without first obtaining leave under Clause 12. The said leave is sought for today for the purpose of regularising the suit. The third defendant has died during these years and another person is sought to be substituted in his place. There has been a change of name of the first defendant, as named in the plaint and amendments are sought in that regard also.

3. The point of primary importance is whether leave under Clause 12 of the Letters Patent can, in law, be granted today.

4. Under Clause 12 of the Letters Patent it has been clearly provided that this Court shall not receive, try or determine suits in case such leave is necessary in terms of the Clause, unless such leave has been first obtained.

5. In the absence of a leave, therefore, being first obtained, this Court and no Judge of this Court can receive, try or determine a suit.

6. Mr. Girish Gupta appearing on behalf of the first defendant has most helpfully relied upon the case of Kshitish Kumar Som v. State of Bihar, reported in : AIR1953Cal639 . It was ajudgment of Justice p. N. Sinha, sitting singly and His Lordship, drawing upon His Lordship's experience on the Original Side as well as upon decided authorities, laid down the following five propositions with regard to grant of leave under Clause 12. The said five propositions are binding upon me and the tame are set down below:

'1. Where leave under clause 12 of the Letters Patent is necessary, the granting of such leave is the condition precedent to the Court having jurisdiction to entertain the suit.

2. Therefore, such leave is to be obtained at the time of the institution of the suit. In the Original Side of this High Court, the practice is to present the plaint before the Master who places it before a judge of this Court for granting the requisite leave. It does not mean, however, that such leave is granted after the institution of the suit. For the purpose of limitation the date of the presentation of the plaint may be relevant but the leave when granted is nevertheless leave granted prior to the institution of the suit.

3. Where by amendment of a plaint, a cause of action is altered or a new cause of action added, it is not a new suit but the old suit in a new form. In such a case, no amendment can be ordered if it requires leave to be granted under clause 12 of the Lettes Patent, at the time of the amendment.

4. It follows that leave under clause 12 of the Letters Patent cannot be granted in such a case, at any stage after the institution of the original suit.

5. But where a new party is added, the suit as regards the added party must be deemed to have been commenced on the date when he was so added. Consequently, if the cause of action against the added party requires leave under clause 12 of the Letters Patent it is open to the Court to grant such leave, if asked for at the time of the amendment. In fact, if such leave has not been asked for or obtained in such a case, the court has no jurisdiction to entertain the suit against such an added defendant.'

7. In second proposition it would be found that his Lordship clearly contemplated the possibility of a suit being instituted on a particular date for the purpose of limitation and the suit being receivable by this Court on another date, the same being subsequent to grant of leave under Clause 12. The delay that His Lordship contemplated as between these two points of time, was the delay that would occur for the putting up of the plaint by the learned Master before the Interlocutory Bench. The delay probably would never be even of a day. But what is import ant for our purpose is not the degree of delay but the' possibility of there being at all a difference in date between the two purposes, one for limitation and another for reception of the suit for trial.

8. It is this delay and difference in date that shows up glaringly in the instant case. There cannot be any dispute that the suit was presented or more accruately, the plaint was presented to a proper Officer of this Court in 1984. In the judgment of Justice Sinha such proper Officer within the contemplation of His Lordship in accordance with the practice then prevalent, would be the learned Master. The suit thus stood institution on the date appearing in the original plaint for the purposes of limitation in the year 1984 itself.

9. Sub-section (2) of Section 3 of the present Limitation Act is relevant in the above regard and the material portion thereof is set out below:

'For the purposes of this Act --(a) The suit is instituted

(i) In an ordinary case, when the plaint is presented to the proper Officer;

(ii) In the case of a pauper, when his application for leave to sue as pauper is made.'

10. The practice of grant of leave under Clause 12 has varied from time to time. Mr. Girish Gupta has pointed out that initially in the early years of this Century leave used to be granted by the learned Registrar on the Original Side. That practice was subjected to scrutiny and the Full Bench of this Court decided that the question of grant of leave was a judicial act deciding upon rights of parties and as such, could not be preformed excepting by a Judge of this Court.

11.According to the practice prevailing today the plaint need not necessarily be routed to the learned Interlocutory Judge by its first being presented to the learned Master. Leave can be obtained by presenting the plaint in Court before the learned Interlocutory Judge himself. As such, for the purpose of limitation the learned Master as well as the learned Interlocutory Judge would both be approached for the first presentation of plaint.

12. In case there is a delay of two or three days between presentation of the plaint to an Officer of this Court, like the learned Master, and the grant of a leave under Clause 12 by way of an interlocutory order, nobody would bother his head about it. But the delay in this case is not of two or three days but is of 8 years. The exact position in law regarding grant of leave subsequent to presentation of the plaint to an Officer of this Court, therefore, must be clarified for the purpose of this application.

13.Prior to grant of leave under Cl. 121 the suit might be instituted for the purpose of I the Limitation Act but that is about all. No steps can be taken in the suit. The suit cannot j be tried,received ordetermined. Any departmental issuance of any writ or summons on such a plaint which requires leave under clause 12 of the Letters Patent bin has not got it, is an issuance of only a purported writ of summons which s of no effect or legal validity. Any steps taken in the suit by any of the parties or any of the learned Advocates on their behalf prior to grant of leave under Clause 12 is also of no legal effect whatsoever. Just as by keeping the plaint outside the door of the presenting Department, steps in the suit cannot be taken either by way of service of process or otherwise, so also can no such steps be taken if the plaint is merely presented to an Officer for the purpose of the Limilation Act but no leave is obtained even where the same isnecessary onthe express wording of Clause 12.

14. The point, however, remains to be answered whether leave under Clause 12 can be granted in law later on in time after the presentation of the plaint in the department to an Officer. In my opinion, the second propo-. sition in Justice Sinha's judgment quoted above is itself an authority for an affirmative answer to the aforesaid question. The juris diction to grant leave under Clause 12 to a plaint presented prior tiiereio in point of time exists in law. Whether that jurisdiction would be exercised by the Court would depend upon the facts and circumstances of the case as well as the currenl trend of law relating to condonation of delays in the matter of approaching courts and Tribunals.

15. The propriety of the grant of leave tinder clause 12 of the Letters Patent has not been much in issue. There are naturally, no paragraphs in the plaint as presented stating which part of the cause of action arose within jurisdiction. The mind of the learned Advocate handling the case at that time not being addressed to the issue of clause 12 (or leave thereunder) at all, the body of the plaint itself would have to be looked into today for the purpose of ascertaining if any part of the cause of action has even been pleaded to have arisen within jurisdiction. Even after grant of leave under Clause 12, it is open to parties to pray for a revocation therefore on grounds well settled in law today. But that is not the application before me. Naturally, there can be no application for revocation unless a leave has at all first been granted.

16. From a copy of the plaint as sought to be amended annexed to the affidavit in support of the Master's Summons, it appears that the addressees given at paragraphs 2, 3 and 11 of the plaint are addresses within the local limits of the original jurisdiction of this Court as delineated in the Letters Patent. It would be possible therefore to grant a leave under Cl. 12 and the same need not necessarily be refused for want of pleading in the plaint itself.

17. How should the matter of delay be dealt with? The delay is long but in my opinion not unexplained. The learned previous advocate whose name is mentioned in the third paragraph of the affidavit in support of the Summons was communicated with by the Bank again and again continuously from the year 1984. Several letters regarding queries by the Bank are annexed to the said affidavit. It is also a matter evident from the records that the said learned Advocate fell into an elementary lapses in not obtaining leave under Clause 12 of the Letters Patent. Such a lapse could not only have occurred on the part of one wholly unfamiliar with the practice and procedure on the original side of this Court.

18. The Bank's case is that in 1989 the papers were taken away from the learned Advocate who had fallen into the error of not taking leave under Clause 12 of the Letters Patent and that the present Advocates of the Bank were engaged in March 1991. The Master's Summons is dated 31st May, 1991.

19. I am of the opinion that the long delay of even eight (8) years should be condoned on an application of two principles. The first of these principles is that a party litigant should not be made to suffer for lapses on the part of the litigant's advocate-on-Record. The authorities in this regard have now become numerous. Mr. Rajesh Khanna appearing for the petitioner Bank relied on several cases in this regard, reported in : [1981]3SCR509 ; : AIR1984SC41 ; : AIR1986Cal437 ; AIR 1977 SC2319 and : AIR1979Cal107 . The lapses of the erstwhile Advocate of the plaintiff are manifest in both the dilatory nature of his carrying on with the progress of the suit as well as in his lapse in not obtaining leave through what must have been lack of efficiency or knowledge. If the Bank, namely the Canara Bank, is to be deprived of its rights of prosecuting the claim against the defendants it is the Bank that would have to pay for the default of its pleader or Advocate. That should be avoided if possible, as the law on the subject today lays down.

20. The second principle is that in matters of Government litigations extention of time like extension of time under Section 5 of the Limitation Act is granted with a much greater facility than in other cases. Again and again the Supreme Court has made this point clear. Though no case in this regard was actually cited before me, yet the authorities are too well known and too numerous to be overlooked by me. On a parity of reasoning, if a Government Undertaking or an Article 12 authority, is likely not to have an adjudication of its claims on merits because of mere delay on the part of its Advocate-on-Record or even itself, then the Court would rather try to prevent such procedural dismissal of the claim. The Court would rather attempt to let the issue go to trial on matters of substance.

21. In the instant case, therefore, the Bank's claims should be tried by way of trial of the suit and accordingly the long lapse prior to the prayer for leave under Clause 12 being at all made is condoned.

22. The above discussion, I hope and' venture to think would be sufficient for the first two prayers in the Master's of Summons. The prayers are set out below:

(a) Leave be granted under Clause 12 of the Letters Patent for institution of the said Suit No. 331 of 1984 (Lakshmi Commercial Bank Ltd. v. Bengal National Textile Mills Ltd.) in this Hon'ble Court,

(b) Delay, if any, in making this application be condoned;

(c) Abatement of Suit No. 331 of 1984 (Lakshmi Commercial Bank Ltd. v. Bengal National Textile Mills Ltd.) be set aside;

(d) Cause title and the body of the plaint in Suit No. 331 of 1984 (Lakshmi Commercial Bank Ltd. v. Bengal National Textile Mills Ltd.) be amended as indicated in red ink in copy of the plaint annexed marked 'A' and consequently amendment of the suit register be effected.

(e) Such amendments as aforesaid be carried out within the period of 4 weeks from the date of the order to be passed herein;

(f) Leave be given to reverify the plaint;

(g) Fresh Writ of Summons do issue under the signature and seal of this Hon'ble Court for service on the defendants;

(h) Sheriff of Calcutta be directed to act accordingly for service of such Summons,

(i) Costs of and incidental to this application be costs in the suit;

(j) Such further and other order or orders be made and/or direction or directions be given as to this Hon'ble Court may deem fit and proper.'

23. So far as prayer (c) is concerned, the question of setting aside any abatement in the suit does not arise because the suit cannot be treated to have been received by this Court for any purpose before this Court proceeds to grant leave under Clause 12. The third defendant as named and pleaded in the plaint having died, there is no suit against the third defendant.

24. The suit against Binod Chand Kan-karia, as sought to be continued by substitution after setting aside of abatement, cannot today be instituted without prejudice to the possible rights of Binod Chand Kankaria with regard to the question of limitation. If Binod Chand Kankaria is to be added as a party to this suit fresh leave under Clause 12 of the Letters Patent would be needed even if this Court grants leave under Clause 12 of the Letters Patent to the plaint as it originally stood. Accordingly, the plaintiff bank would have to satisfy a future court oh, a future occasion about its rights to add Binod Chand Kankaria as a party' to this suit. For the purpose of enabling the bank to consider the position in that regard the Bank is restrained by way of injunction from making any application or instituting any proceedings against Binod Chand Kankaria for a period of two weeks from date hereof.

25. Since I have already decided to grant an order in terms of prayers (a) and (b) of the suit, the question of amendments can be gone into. The amendments as indicated in red ink in the copy annexed to the supporting affidavit of Ranjan Kumar Ghosh shall be permitted to be made excepting for the substitution of the original 3rd defendant and the conseqential amendments, the same being apparent from the cause title and the body of the plaint like in Paragraphs 4 and 5. No amendment shall be permitted which seeks to make allegations against Binod Chand Kankaria in place of the original defendant No. 3.

26. So far as the other amendments are concerned, these are consequent upon the take over the rights and liabilities of the original plaintiff by the Canara Bank and the change of name of the first defendant.

27. The justice of the case deserves that Canara Bank be permitted to make this application for grant of subtequent leave under Clause 12 of the Letters Patent by virtue of its take over of the rights of the Lakshmi Commercial Bank Ltd. The effect in law would be that upon grant of leave under Cl. 12 at the instance of Canara Bank, the Original suit of Lakshmi Commercial Bank Ltd. as provided in the original plaint will stand properly received by this Court. Thereafter, upon grant of permission to amend the cause title by substituting Canara Bank in the place of Lakshmi Commercial Bank Ltd., Canara Bank will become plaintiff in the suit. It would, to my mind, be placing over emphasis upon mere procedure, in case this application were disposed of only by grant of leave under Clause 12 at the instance of Canara Bank leaving it to take all consequential steps by way of subsequent applications. There shall accordingly be orders in terms of prayers (d) and (e) excepting that the amendments with regard to the third defendant are disallowed.

28. The inclusion of the paragraph being paragraph MA regarding the usual pleading for clause 12 is permitted to be inserted but the same will naturally now come in after Cl. 12 leave has been granted. Even without the said paragraph 11A the plaint would be good (if it were otherwise good) but I permit the said paragraph to remain on record if only because it makes the plaint consistent with the usual manner and method of drafting plaints on the original side, which might not have been so well known to the learned Advocate-in-Charge of the case at the time of draft of the plaint.

29. Prayers (g) and (h) are refused and they do not arise because the question of issuance of Writ of Summons shall arise only now when the suit becomes receivable either by a judge of this Court or by a department of this Court.

30. There shall accordingly be orders in the manner indicated above, granting leave under Clause 12, permitting to incorporate amendments of the plaint and reverification thereof. If necessary, fresh leave under Clause 12 is also to be treated as granted for the purpose of the amendments allowed herein. The injunction regarding Binod Chand Kankaria shall operate for two weeks as indicate above. The Bank should pay the costs of this application, in spite of getting orders in its favour, assessed at 150 G.Ms, to be paid to M/s. L.P. Agarwalla & Co. Such costs are to be paid in course of a week from today in default of which, the application shall stand dismissed with costs.

31. Stay of operation of the order is prayed for on the part of the first defendant, but the same is refused.

32. The suit appearing in today's list could not properly have appeared at all and as such must stand out of the list for the time being.

33. All parties including the department are to act on a signed copy of this dictated order on the usual undertaking.

34. Order accordingly.


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