KANTHAL INDIA LTD Vs. ANANT PRASAD BHATIA

JUDGEMENT

(1.) These are three applications. The two applications are for revocation of leave under cl.12 of the Letters Patent taken out by the defendants Nos. 1 and 2 respectively. The other is an application for amendment of the plaint taken out by the plaintiff. By consent of the parties all the three applications are taken up and are heard together.

(2.) Mr. Biswaroop Gupta, learned Counsel for the defendant 1 in the application taken out on his behalf for revocation of leave under cl.12 of the Letters Patent submitted that on the basis of the plaint filed in this suit no cause of action against the defendant 1 arose within the jurisdiction of this Court. Therefore, so far as the said defendant is concerned this Court has no jurisdiction to entertain or try the suit. Mr. Gupta also urged that in any event the plaint does not disclose any cause of action whatsoever against the defendant No. 1. Therefore, no leave could be granted under cl.12 of the Letters Patent inasmuch as the suit itself was not maintainable against the defendant 1. Similar contentions were also raised by Mr. Gour Roy Chowdhury, learned counsel for the defendant 2 on whose behalf the other application for revocation of leave under cl.12 of the Letters Patent has been taken out.

(3.) To appreciate the rival contentions of the parties in all these applications it is necessary to note what case the plaintiff has made out in the plaint as against the defendants. There are three defendants in this suit. The third defendant B.M. Singh and Sons is the sole selling agent of the products of the plaintiff and as such it has been made a party to this suit but no relief has been claimed against it in this suit as will appear from para 22 of the plaint, but the defendant 3 has been joined in this suit as the plaintiff has been advised to impaled the said defendant, as his presence is necessary for complete adjudication of the disputes. Thus the defendant 3 is a defendant, which in common parlance is known as pro forma defendant. The case of the plaintiff as laid in the plaint is that the defendant 2 was the Branch Manager of the plaintiff of its Varanasi Unit. The defendant 1 was a director of the plaintiff and is the father of the defendant 2. By a written agreement dated 1st June, 1973 made within the jurisdiction of this Court in Calcutta the plaintiff appointed the defendant 3 as the sole selling agent of its products and as such agent the defendant 3 became entitled to receive from the plaintiff certain commission on percentage basis on the value of the products of the plaintiff sold. It is next pleaded that with effect from Aug. 1978 the defendant 3 appointed or engaged the defendant 1, inter alia, as its agent to watch the interest of the defendant 3 at Varanasi and the defendant 3 agreed to pay to the defendant 1 one per cent of the commission due to the defendant 3 from the plaintiff in respect of the Varanasi unit. The plaintiff was informed of the said arrangement between the defendant 3 and the defendant 1 by a letter dt. 4th Dec., 1978 by the defendant 3 which was received by the plaintiff at its registered office in Calcutta within the jurisdiction of this Court. It is also pleaded that the plaintiff duly made all payments to the defendant 1 and to the defendant No.3 in terms of the above arrangement. It is next pleaded that the above arrangement was modified or varied with effect from 1st Aug., 1980 by an agreement between the defendant 1 and the defendant 3. One of such variation was that from Aug., 1980 every month an amount equivalent to about 1% of the commission due to the defendant 3 for the preceding month would be paid to the defendant 1 and this would be treated as payment on defendant 3's special account. The other variation was that all amounts paid to the defendant 1 by the plaintiff's Varanasi unit on behalf of defendant 3 should be confirmed by the plaintiff's Calcutta office as per existing practice and the said arrangement would continue until further advice was received from the defendant 3. The defendant No. 3 informed the plaintiff by a letter dt. 11th Sept., 1980 of the aforesaid arrangement which was received by the plaintiff at its registered office within the jurisdiction of this Court and the plaintiff agreed to comply with or to give effect to the same at its registered office within the jurisdiction of this Court. The defendant 1 acted as such agent of the defendant 3 at Varanasi and the plaintiff paid to the defendant 1 various amounts on account of the commission payable by the defendant 3 to the defendant 1 in the said special account an account of defendant 3. On or about Nov. 25, 1980 the defendant 3 sent a letter to the plaintiff from Calcutta within jurisdiction of this Court to the plaintiff's Varanasi unit, a copy of which was sent to the Calcutta office of the plaintiff within the jurisdiction of this Court instructing or requesting the plaintiff not to make any more payment to the defendant 1 in the said special account and to suspend the authority of the defendant 1 to receive any further payment in the said special account for and on behalf of defendant 3. It is also pleaded that the defendants 2 and 3 had due knowledge of the said letter of the defendant 3. In spite of suspension of authority to receive any further money on behalf of defendant 3 in the said special account, the, defendant I in collusion and conspiracy with the defendant 2 wrongfully and illegally and with the knowledge of the plaintiff withdrew from the said special account an aggregate sum of Rs. 65,000/- by three several cheques which were drawn on the Punjab National Bank at Varanasi. It is next pleaded in the plaint that the plaintiff came to know of the withdrawal of the said amount of Rs. 65,000/-. There were meetings of the Board of Directors held on 31st March, 1981 and on the 16th and 17th March, 1981 and the defendant 1 attended those meetings of the Board of Directors. It is pleaded that the defendant 1 took the responsibility of having made payments and he would get defendant 3 acknowledge the receipt of the said amount of Rs. 65,000/- failing which he would take the liability personally, which, however, the defendant 1 failed to do. The said board meetings were held outside the jurisdiction of this Court. Thereafter the defendant No. 1 resigned from the Board of Directors of the plaintiff and his resignation was accepted at the board meeting of the plaintiff held on 23-6-1981. It is also pleaded that the defendant 3 disputed the unauthorised withdrawal of Rs. 65,000/- from the said special account by the defendant 1 and thereupon the plaintiff paid the said amount to the defendant 3 which defendant 1 was legally bound to pay to defendant 3 but failed to do so. It is also pleaded that the defendant 1 in collusion and conspiracy with the defendant 2 withdrew the said amount and by the said wrongful and illegal act caused deprivation of the said amount to the plaintiff.