SETH KIRPAL CHAND Vs. TRADERS BANK LTD JAMMU

JUDGEMENT

(1.) THIS is a revision application directed against an order of the District Judge, Jammu, allowing an amendment of the plaint under O. 6, R. 17, Civil P. C. The facts out of which this revision application has arisen are briefly these: A suit was instituted on behalf of the non -applicant plaintiff Bank on 3rd Baisakh, 2006, corresponding to 15th April, 1949 by Mr. Mahajan Advocate for the non -applicant. The plaint had been signed and verified by Mr. P. K. Vohra, the Manager of the plaintiff. An objection having been taken that neither the suit had been instituted through a validly and properly authorised person nor had the plaint been signed and verified by such person. Mr. Mahajan got back the plaint and got it signed by the Secretary of the plaintiff Bank and presented it in the Court on 12th Chet 2006. The defendant again objected that the Secretary was not a competent person to institute the suit nor could he sign and verify the plaint. This objection was made an issue between the parties. Eventually on 28th Baisakh, 2008 an amended plaint was filed on behalf of the plaintiff Bank with an application for permission to file the same in which it was stated that the plaint had been duly signed and verified by Mr. Vohra, Manager of Jammu Branch on behalf of the Bank but it transpired that Mr. Vohra had no power of attorney on behalf of the Bank at the time but the plaintiff Bank by resolution of the Board No. 20 dated 18 -10 -1949 confirmed and ratified the action of Mr. Vohra and that he was given a power of attorney dated 17 -5 -1950 by the Bank authorising him to institute suits and do other acts specified therein on behalf of the plaintiff. This application was opposed on behalf of the defendant applicant on the main ground that the subsequent ratification by the plaintiff Bank could not validate the institution of the suit by Mr. Vohra and that the suit should be thrown out and no permission for amendment given to the plaintiff. The learned District Judge, after hearing arguments on the point, disallowed the objection raised by the applicant and allowed amendment on payment of Rs. 80/ - as costs to the applicant.

(2.) A preliminary objection was taken by the learned counsel for the non -applicant that, as Rs. 80/ - as costs had been accepted by Mr. Inder Das Grover, the applicant could not file a revision petition against the order of the learned District Judge allowing amendment of the plaint. The learned counsel for the applicant submitted that he had accepted costs without prejudice to the right of the applicant to file and press the revision application and that he had given a receipt to Mr. Vohra, Manager of the plaintiff Bank, specifying this fact Mr. Vohra, who was present in the Court, stated that he could not recall to mind what Mr. Inder Das had stated at the time of accepting the cost; and that he would look into his record. Since then Mr. Inder Das has filed an affidavit to sup port the statement made by him in the Court. No counter -affidavit has been filed by Mr. Vohra, nor has he produced the receipt of Mr. Inder Das be fore the Court. In these circumstances, it is held that the counsel for the applicant accepted costs without prejudice to the right of the applicant to file the revision application and, therefore, the preliminary objection raised by the learned counsel for the non -applicant is disallowed.

(3.) THE learned counsel for the applicant has drawn my attention to Note 2 of Chitaleys Code of Civil Procedure 1951 Ed. under O. 29, R. 1, Under R. 1 of O. 29, in suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case. The relevant portion of Note 2 referred to above to which my attention has been invited by Mr. Inder Das states: "The rule does not authorise such persons to institute suits on behalf of the corporation." It merely authorizes the persons mentioned therein to sign and verify pleadings on behalf of a corporation. In this view the institution of the suit and the presentation of the plaint should be done by the party in person or by his recognised agent, or by a pleader appearing, applying or acting, as the case may be, on his behalf, as required by order 3, rule 1, C. P. C. It is, therefore, contended that in the case of a corporation, if the initiative to institute the suit was not taken by the corporation itself, it cannot, by subsequent ratification, validate the action of a person instituting the suit, if at the time of the institution of the suit he was not competent or authorized to institute it. In support of this contention Mr. Inder Das cited before me - Secy. Notified Area Committee, Okara v. Kidar Nath, AIR 1932 Lah 388 A; - Notified Area Committee, Okara v. Kidar Nath, AIR 1935 Lah 345 B; - Tila Mahomed Haji Mahomed Amin v. Municipal Committee, Peshawar, AIR 1941 Pesh 76 C; - Chunnilal Bhag -wanji v. Kanmal Lalchand, AIR 1944 Bom 201 D; - Dr. Satya Charan Law v. Rameshwar Prasad, AIR 1950 FC 133 E. AIR 1932 Lah 388 A is a case in which the plaintiff was the Notified Area Committee, Okara. The suit had been brought by the secretary without consulting the Notified Area Committee and without any resolution of that Committee having been passed for the purpose, Later on, however, the Committee passed a resolution delegating power to bring suits on behalf of the Committee to the Secretary. In this case Dalip Singh J. held, inter alia, that "a suit must be decided to be good or bad on the day when it is instituted and it cannot be ratified subsequently." AIR 1935 Lah 345 B, which is also a Single Bench case, followed - AIR 1932 Lah 388 A. In - AIR 1941 Pesh 76 C, it was held that in suits against a municipality the secretary could engage a counsel under a general power of attorney given to him and special authorization by the municipality was not necessary. This case, therefore, is not directly in point. The learned counsel for the applicant, however, laid special stress on an observation made in this case by the learned Judicial Commissioner to the following effect: "Defending an action is certainly different from instituting an action. The latter step requires initative which should certainly come from the municipality itself and not from its agent." In - AIR 1944 Bom 201 D Sir John Beaumont C. J. held that though the next friend of a minor can appoint a recognized agent under O. 3, R. 1, "he has no right to pass a general power of attorney in respect of the minors property." Such a power of attorney, according to this ruling, would not enable the attorney to file suits in the name of unspecified minors, using the grantors name as next friend. It was further held that such a defect could not be cured by amendment, AIR 1950 FC 133 E has been cited to focus attention on an observation of Fazl Ali J. in that case which is as follows: "The correct position seems to us to be that ordinarily the directors of a company are the only persons who can conduct litigation in the name of the company, but when they are themselves the wrongdoers against the company......the majority of the share -holders must in such a case be entitled to take steps to redress the wrong." I am afraid this case is not much to the point. It appears that the observation of the learned Judge in this case is based on the provisions contained in the Articles of Association of the Company, according to which the directors of the company had the power to institute, conduct, defend, compound, or abandon any legal proceedings by or against the company. The learned counsel for the non -applicant in reply submitted that the two Lahore and the Peshwar case cited by the learned counsel for the applicant related to the municipalities which were statutory bodies and which were governed by the peculiar provisions of the statutes by which those - authorities were created & none of the case cited by the learned counsel for the applicant related to a joint stock company. So far as - AIR 1944 Bom 201 D was concerned, he referred to a later Bombay case - Dahyabhai Girdhardas v. Bobaji Dahyaji, AIR 1953 Bom 28 F, in which the view taken by Sir John Beaumont was departed from by the present Chief Justice. It was held in -AIR 1953 Bom 28 F, that the learned Chief Justice in - AIR 1944 Bom 201 D "was in error in the view that he took". It was laid down that a plaint signed by the son of the plaintiff who had no proper authority to sign it on behalf of the plaintiff can be allowed to be amended at a later stage by allowing the plaintiff to sign irrespective of the bar of limitation, inasmuch as the defect is merely formal. Mr. Mahajan referred to a number of other cases out of which he laid special stress on ILR 25 Allahabad 635 H. In this case the plaint in a suit on behalf of the Maharaja of Rewah, a Ruling Chief, had been signed and filed by one Abdul Rehman who was not a recognized agent at the time when the suit was filed under S. 432, Civil P. C. as then in force. The Court of first instance had decreed the suit. On appeal the appellate court of District Judge, Mirzapur took the view that the plaint was not properly signed and presented and dismissed the suit. The High Court accepting the second appeal held: "Whatever defect might have existed in it plaint in consequence of Abdul Rehman not having been appointed the recognized agent of the Maharaja by the Government until the 16th of April 1900, that defect was cured as soon as he was so appointed on 16 -4 -1900. On that date the prescribed period of limitation for the suit had not expired...................... As soon as Abdul Rahman was appointed the recognized agent of the plaintiff Maharaja, he became competent to institute the suit and verify the plaint on behalf of the Maharaja. The plaint was already before the Court, and Abdul Rahman had signed and verified it. It became a valid and effective plaint for all purposes as soon as the formal order for his appointment was obtained." In his further submissions the learned counsel for the applicant argued that the learned counsel for the non -applicant had not been able to refer to a case of any joint stock company, nor had he been able to show why the case of a joint stock company should be distinguished from that of a municipality when both fell within the definition of the term corporation as contained in O. 29, R. 1, C. P. C.