INDIAN POTASH LIMITED Vs. POTASH RESEARCH INSTITUTE

JUDGEMENT

(1.) On the application under Order 7 Rule 11 Code of Civil Procedure moved by ther defendants, following preliminary issue was framed :- 1) whether the suit does not disclose any cause of action and if so its effect? OPD. Thei relevant facts to decide the aforesaid issue in right perspective need to be recapitulated in brief.

(2.) The plaintiff is a Joint Sector Company under the Administrative Control, of Department of Fertilisers, Union Ministry of Chemicals & Fertilisers. The plaintiff states that over 90% of the equity of the plaintiff company is held by Government funded State Co-operative Federations and Public Sector Companies. The plaintiff in furtherance of its objective-of doing research in the field of agriculture and fertilisers decided to float a Society for the said purpose. Accordingly, defendant no.1 society was former and registered under the Societies Registration Act, 1860. The primary objective of the defendant no.l as per memorandum of association and rules and regulations have been detailed in para 3 of the plaint.

(3.) The plaintiff was the prime funding agency for the defendant no.1 society. Between the year 1977 to 1982, the plaintiff contributed nearly Rs.4.50 crores towards the funding of the Institute which was primarily utilized for c6ristruction of building for office, laboratories and residential complex and purchase of research equipment etc. About Rs.2.5 crores was retained by the Institute as the corpus which is invested in deposits with Public Sector undertakings. A further sum of Rs.75 lakhs, was contributed by the Indo Canadian Agriculture., Extension Project which was being implemented by the plaintiff at that time. The annual budget of the Institute was estimated to be nearly Rs.45 lakhs which was to be met out of the income from interest on deposits.