2006 (3) TMI 750 - SC - Indian Laws

Amendment of pleadings - Order 6 Rule 17 of CPC - HELD THAT - Order 6 Rule 17 of CPC declares that the Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such a manner and on such terms as may be just. It also states that such amendments should be necessary for the purpose of determining the real question in controversy between the parties. The proviso enacts that no application for amendment should be allowed after the trial has commenced unless the Court comes to the conclusion that in spite of due diligence the party could not have raised the matter for which amendment is sought before the commencement of the trial. The real controversy test is the basic or cardinal test and it is the primary duty of the Court to decide whether such an amendment is necessary to decide the real dispute between the parties. If it is the amendment will be allowed; if it is not the amendment will be refused. On the contrary the learned Judges of the High Court without deciding whether such an amendment is necessary has expressed certain opinion and entered into a discussion on merits of the amendment. In cases like this the Court should also take notice of subsequent events in order to shorten the litigation to preserve and safeguard rights of both parties and to sub-serve the ends of justice - It is settled by catena of decisions of this Court that the rule of amendment is essentially a rule of justice equity and good conscience and the power of amendment should be exercised in the larger interest of doing full and complete justice to the parties before the Court. The respondents have filed their amended written statement and the appellants their replication to the amended written statement and conducted admission and denial of documents and more so the issues were framed and despite the said fact the High Court has allowed the appeal of the respondents and dis-allowed the application of the petitioner for amendment of the plaint. Since the Court has entered into a discussion into the correctness or falsity of the case in the amendment there are no other option but to interfere with the order passed by the High Court. Since it is settled law that the merits of the amendment sought to be incorporated by way of amendment are not to be adjudged at the stage of allowing prayer for amendment the order passed by the High Court is not sustainable in law as observed by this Court in SAMPATH KUMAR VERSUS AYYAKANNU AND ANR. 2002 (9) TMI 865 - SUPREME COURT . Now that the amended plaint written statement and the issues have been framed it is for both parties to contest the suit on merits on the basis of the amended plaint written statement and the issues now framed. The suit was filed in the year 1997. Now that the pleadings are complete and the suit is ready for trial the High Court is requested to dispose of the suit as expeditiously as possible and at any rate not later than 6 months from the date of receipt of the copy of the order from this Court or on production of the same by either party whichever is earlier - appeal allowed.

Issues Involved:
1. Amendment of Pleadings
2. Determination of Real Controversies
3. Bona Fide of Amendment Application
4. Consistency with Original Case
5. Applicability of Sections 60 and 61 of the Indian Trusts Act
6. Judicial Precedents on Amendment of Pleadings

Detailed Analysis:

1. Amendment of Pleadings:
The appellants sought to amend the original plaint under Order VI Rule 17 read with Section 151 CPC, aiming to incorporate new facts and reliefs, including the sale of GPI shares and investment of proceeds in government bonds/securities. The application was initially allowed by the learned single Judge but subsequently dismissed by the Division Bench of the High Court on grounds that it introduced a new and inconsistent case.

2. Determination of Real Controversies:
The Supreme Court emphasized that amendments necessary for determining the real questions in controversy should be allowed. The Court noted that the proposed amendment did not change the basic structure of the suit but merely altered the nature of relief claimed. The Court reiterated that the object of Order VI Rule 17 is to allow amendments that help in resolving the real dispute between the parties.

3. Bona Fide of Amendment Application:
The Division Bench of the High Court had dismissed the amendment application on the grounds of lack of bona fides, suggesting it was made for collateral purposes. However, the Supreme Court found that the amendment sought was in the interest of the beneficiaries of the Trust and aimed to address the alleged misuse of Trust assets by respondent No.1. The Court held that the amendment was necessary and not made with any malafide intention.

4. Consistency with Original Case:
The Supreme Court disagreed with the High Court's view that the proposed amendment introduced a new and inconsistent case. The Court observed that the entire case revolved around the GPI shares and the dividends not being accounted for. The amendment sought to address these issues by proposing the sale of shares and reinvestment of proceeds, which was consistent with the original plaint's objectives.

5. Applicability of Sections 60 and 61 of the Indian Trusts Act:
The respondents argued that the proposed amendments were contrary to Sections 60 and 61 of the Indian Trusts Act, which allow beneficiaries to enforce the terms of the Trust. The Supreme Court found that the amendments were within the ambit of these sections, as they sought to protect the interests of the beneficiaries and ensure the proper management of Trust assets.

6. Judicial Precedents on Amendment of Pleadings:
The appellants relied on several Supreme Court judgments, including M/s Ganesh Trading Co. vs. Moji Ram, Jai Jai Ram Manohar Lal vs. National Building Material Supply, Gurgaon, and Ragu Thilak D. John vs. S. Rayappan and Others. These cases support the principle that amendments should be liberally allowed to promote justice and resolve the real controversies. The Supreme Court found these precedents applicable and held that the High Court had erred in dismissing the amendment application.

Conclusion:
The Supreme Court allowed the civil appeals, set aside the Division Bench's order, and reinstated the learned single Judge's order permitting the amendment of the plaint. The Court directed the High Court to expedite the trial and dispose of the suit within six months, emphasizing that the merits of the amendment should not be adjudged at the stage of allowing the amendment application.

← Previous Next →