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The Indian Penal Code
The Code Of Civil Procedure (Amendment) Act, 2002
Article 21 in The Constitution Of India 1949
The Companies Act, 1956
Kashi Nath Mishra vs Vikramaditya Pandey And Ors. on 14 March, 1996

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View the actual judgment from court
Bombay High Court
H vs Companies Act, 1956 And Having Its on 30 July, 2009
Bench: A.M. Khanwilkar

1

IN THE HIGH COURT OF JUDICATURE AT BOMBAY rt

ORDINARY ORIGINAL CIVIL JURISDICTION ou

APPEAL NO.229 OF 2009

IN

CHAMBER SUMMONS NO. 218 OF 2009

IN

C

SUIT NO. 95 OF 2006

NTPC Limited ) (Formerly National Thermal Power ) h

Corporation Limited) a Company ) incorporated under the Companies Act, 1956) ig

and having its Registered ) office at NTPC Bhawan, Scope Complex, 7, ) Institutional Area, Lodhi Road ) H

New Delhi 110 003. ).. APPELLANT VERSUS

y

Reliance Industries Limited ) a Company incorporated under the ) ba

Companies Act, 1956 and having its ) Registered Office at 3rd Floor, Maker ) Chambers IV, 222, Nariman Point ) Mumbai 400 021. ).. RESPONDENT om

Mr. D.D. Madan with Mr. V.R. Dhond and Mr. S.V. Doijode and Ms. Meenakshi Iyer i/b Doijode Associates for the Appellant. Mr. Milind Sathe a/w Mr. C.S. Balsara i/b M/s. Junnarkar & B

Associates for the Respondent.

CORAM : SWATANTER KUMAR, C.J. And A.M. KHANWILKAR, J.

JUDGMENT RESERVED ON : 22ND JULY 2009 JUDGMENT PRONOUNCED ON : 30TH JULY 2009 ::: Downloaded on - 09/06/2013 14:51:02 ::: 2

JUDGMENT (Per Swatanter Kumar, C.J.) rt

ou

The National Thermal Power Corporation Limited (for short "NTPC") claims that it is the largest thermal C

electricity generating company of India and it intends to enhance the capacity of its existing combined cycle power stations in the State of Gujarat. Thus it invited International h

competitive bids for supplying natural gas to its Power Plants. ig

As per the terms inviting the tender, the NTPC issued RFP H

documents to the qualifying bidders and after financial evolution of techno-commercially acceptable bids, the NTPC y

was to issue Letter of Intent (for short "LOI") to the preferred ba

bidder. Reliance Industries Limited (for short "RIL") was also one of the bidders. The terms were amended vide letter om

dated 15th March 2004. According to the NTPC, RIL confirmed unconditional acceptance of all provisions of RFP documents read together with amendments. As the Letter of Intent was B

issued and as required RIL vide its letter dated 17th June 2004 acknowledged receipt of the LOI dated 16th June 2004 and sent the duplicate copy thereof duly signed. The Co- ordinating Committee of the NTPC along with representatives of RIL was constituted. A meeting was held on 20th October 2004 where it was proposed that a master network of various ::: Downloaded on - 09/06/2013 14:51:02 ::: 3

activities to be undertaken by the parties be drawn and key rt

milestone dates be identified to be used as the basis for monitoring the progress. Vide letter dated 6th May 2005, ou

certain changes were suggested by RIL. Though NTPC was not required to even consider the same but certain C

amendments were made as suggested in letters dated 19th May 2005 and 17th June 2005 as RIL further wanted some h

changes in the project. This was carried on and according to ig

NTPC, RIL's action and conduct clearly spelt out their intention not to perform their contract and it constituted an H

anticipatory breach/ repudiation of the contract. In addition to this, there were certain disputes on quantum pricing and y

finalisation of GSPA. This compelled the NTPC to file a Suit ba

on the Original Side of this Court for declaration and specific performance. The prayers made in the Suit were as under :- om

"(a) That this Hon'ble Court be pleased to declare that a valid, concluded and binding contract exists between the parties for supply of B

Natural Gas of 132 Trillion btu annually for a period of 17 years between the Plaintiff and the Defendant having regard to the documents Exhibits D, E, F and G hereto and the Letter of Intent duly issued by the Plaintiff and signed and returned by the Defendant.

(b) That this Hon'ble Court be pleased to pass a decree of specific performance of the valid, concluded and binding contract set out in prayer (a) above including directing the Defendant to ::: Downloaded on - 09/06/2013 14:51:02 ::: 4

rectify the document sent by them and sign the same in conformity and accordance with agreed rt

terms and for that purpose if necessary to direct the Defendant to initial corrections made by the Plaintiff in the document sent by the Defendant to ou

the Plaintiff which would be in accordance with the Agreement.

(c) That pending the hearing and final disposal C

of this Suit the Defendant, its servants and agents be restrained by an order of injunction of this Hon'ble Court from supplying and entering into any contract or arrangement or making any commitment for any part of the 132 trillion Btu of h

Natural Gas to be supplied to the Plaintiff annually for a period of 17 years from its Gas Field situated ig

at KG Basin (Block KG-DWN-98-3) in the State of Andhra Pradesh.

H

(d) For interim and ad interim relief in terms of prayer (c) above.

(e) For costs of the Suit.

y

(f) For such further and other reliefs as may be ba

required by the nature and circumstances of the case."

om

2. Written Statement had been filed on behalf of RIL. Various objections were taken including that the Plaint does not disclose cause of action, there was suppression of B

material facts, Natural Gas is a traded commodity and a Suit for specific performance for sale thereof is not maintainable in law. On merits, the stand taken is that correct facts have not been stated. According to the Defendant, as per case made out by Plaintiff there were discussions between the ::: Downloaded on - 09/06/2013 14:51:02 ::: 5

parties and in furtherance thereto letters dated 12th August rt

2004 and 15th July 2004 were issued and accordingly 30 days time to sign the GSPA from the date of acceptance of LOI was ou

reckoned. According to the Defendant, case made out by the Plaintiff is inconsistent as Plaintiff alleges several different C

dates and events by which concluded and binding contract came into existence. Whereas Defendant specifically denied h

that there was complete, and concluded contract between ig

the Plaintiff and the Defendant. Defendant denied that it had attempted to renegotiate the terms. The Defendant denied H

that all terms of draft GSPA had been agreed upon or were finalized. According to Defendant, no LOI was accepted y

resulting into concluded contract. The Defendant specifically ba

denied that in May 2004 it had made an offer which was accepted by the Plaintiff and communicated the acceptance om

by letter dated 16th June 2004. Defendant denies having made any offer capable of being accepted. Defendant denies that any act on its part amounts to anticipated B

breach/repudiation of any contract. Defendant has specifically denied that Plaintiff is entitled to specific performance of any contract pertaining to supply of natural gas as there is no valid and subsisting agreement. ::: Downloaded on - 09/06/2013 14:51:02 ::: 6

3. As is evident from the pleadings of the Defendant rt

that it had taken a plea of there being no concluded contract between the parties and thus prayed that the Suit of the ou

Plaintiff be dismissed. During pendency of the Suit, RIL filed Chamber Summons No.218 of 2009 under Order VI Rule 17 of C

the Code of Civil Procedure seeking to amend its written statement. In the affidavit in support of the said Chamber h

Summons, it was averred that the amendments prayed for ig

were material and necessary for appropriate adjudication of the suit. The main ground for seeking amendment was that H

certain events which had transpired after filing of the written statement, which was filed on 31st October, 2007, and the y

submission as an alternative to the plea already taken was ba

that there was no valid, subsisting, binding and concluded agreement between the parties. The Defendant wanted to om

take up the plea that even if there was an agreement, it had been frustrated or had become incapable of performance in view of the subsequent events. These subsequent events B

included declaration of New Exploration and Licensing Policy of 1999. The Government of India had constituted an Empowered Group of Ministers (EGOM) to take decisions in relation to NELP Contract. On 12th September, 2007, the said EGOM had taken a decision in regard to commercial ::: Downloaded on - 09/06/2013 14:51:02 ::: 7

utilization and pricing of gas under NELP and had approved rt

the formula for valuation and sale of natural gas under the Production Sharing Contract. The Defendant had submitted ou

the formula under which the price discovered by the Defendant was US$ 4.32 per MMBTU. However, the EGOM C

modified the same by which the said price had been reduced and fixed at US$ 4.20 per MMBTU. This decision had been h

communicated to the Plaintiff by the letter dated 10th ig

October, 2007. Another ground taken was that, on 28th May, 2008 and 27th October, 2008, NGOP took decisions in regard H

to commercial utilization of natural gas under NELP and framed the guidelines for sale of natural gas by NELP y

contractors which are to be binding and the same relates to ba

the allocation of gas. A reference is also made to the affidavit filed by the Union of India during the course of om

hearing of the appeal in a company matter where it intended to improve on certain facts which have bearing on the contract in question were disclosed in those affidavits and B

they were not known to the Defendants earlier. This affidavit was filed on 13th January, 2009 and it also stated the decision which had been taken in regard to the commercial utilization of gas. With particular reference to Article 21.6.2(b) of these decisions, the matter with regard to the scope and ::: Downloaded on - 09/06/2013 14:51:02 ::: 8

interpretation for Production Sharing Contract which is rt

subject matter of the present suit was also covered and referred to by these different decisions. The Applicants pray ou

that the price to be determined under Article 21.6.2(b) is not different from the price fixed pursuant to Article 21.6.2(c). C

Thus, the entire matter is interconnected. h

4. This application of the RIL was opposed by the ig

NTPC on various grounds including undue delay, that the evidence of the Plaintiff in the suit had already started as H

they had filed their affidavits by way of evidence and the matter was fixed for cross examination. While relying upon y

the judgment of the Supreme Court in Vidyabai & Ors. v. ba

Padmalatha & Anr., JT 2009 (1) SC 302, where the issues were framed and trial had commenced, the Plaintiff prayed om

that the amendment should not be permitted. The learned Single Judge noticed that the amendment application has to be dealt with while keeping in mind the facts and B

circumstances of a given case and relying on the judgment of Supreme Court in Shikharchand Jain v. Digambar Jain Praband Karini Sabha & Ors., (1974) 1 SCC 675 referred to the subsequent events and certain facts which ought to be brought to the notice of the Court for proper and full ::: Downloaded on - 09/06/2013 14:51:02 ::: 9

adjudication to give complete justice to the parties. Learned rt

Single Judge allowed the Chamber Summons and consequently granted the amendments prayed for. Relevant ou

part of the order reads as under:- C

"21. These EgoMs, though referred and observed specifically to exclude the dispute/suit from its decision or recommendation yet just cannot be h

overlooked by the Court while considering the case of the plaintiffs as averred. As noted, the documents and the averments as raised/made by ig

the plaintiffs itself, based upon and revolve around terms and conditions of GSPA and all other necessary and connected aspects. The say H

of Government and such policies always play important role. In my view, all these issues are interlinked and interconnected and depends upon the declared policy and the scheme of such y

agreement to apply of natural gas. ba

22. I am not accepting the submission that if chamber summons is allowed, it would cause grave harm and irreparable loss and injury to the plaintiffs. In view of the events and material on om

record, I am of the view the amendment is bona fide and filed within the reasonable time. The affidavit of Government dated 13.01.2009 play an important role in a matter of this nature specifically when it deals with the natural resource and in the present case the supply of B

gas. Those averments/affidavit and the respective stand and the submission of the Government in other matter is within the knowledge of the defendant, who is concerned defendant in the present case also. Therefore, moved this application to bring of those material on record for adjudication of the Suit in question, where the plaintiff is also claiming the respective quantity of gas from the defendants again based upon the relevant terms and conditions of GSPA, in my view such amendment and the material are ::: Downloaded on - 09/06/2013 14:51:02 ::: 10

necessary for proper adjudication of the controversy involved in the present suit also. rt

Therefore, this chamber summons filed on 6.2.2009, just cannot bar or attract the proviso of Order 6, Rule 17 of CPC as contended by the ou

learned sr. counsel for the plaintiffs.

23. Once the conditions are fulfilled and the Court comes to a conclusion that it is necessary C

to determine the controversy between the parties, based upon the facts and circumstances of the case, it is primary duty of the court to pass an appropriate order to give full opportunity to both the parties. This proviso, no way restricts h

the power of the court to grant amendment, if case is made out."

ig

H

5. With development of law the provisions of Order VI Rule 17 of the Code of Civil Procedure have received y

liberal construction. Despite its liberal construction, the ba

principles dealing with the application for amendment during the pendency of a suit are well settled. In fact, the om

provisions of the Code were amended by the Amending Act of 2002 with effect from 1st July, 2002 wherein proviso to Order VI Rule 17 was introduced. In terms of this proviso, B

there was a kind of restriction placed upon the Court to allow application for amendment after trial had commenced unless the Court came to the conclusion that: (a) in spite of due diligence, the party could not have raised the matter before the commencement of trial. This proviso has to be read and ::: Downloaded on - 09/06/2013 14:51:02 ::: 11

construed keeping in view the language of the principle rt

provision which opens with the words "the Court may at any stage of the proceedings allow either party to alter or amend ou

its pleadings in such manner and on such terms as may be just." The Court has also to keep in mind that the C

amendments to be made are necessary for the purpose of determining the real question in controversy between the h

parties. Thus, it is evident that wide judicial discretion is ig

vested in the Court while dealing with application for amendment of the pleadings. The Court is expected to be H

more careful while dealing with application for amendment in cases where trial has commenced but there is no absolute y

bar in law in allowing application for amendment in cases ba

where trial has even begin. The legislature in its wisdom has not created an absolute bar thus this bar in absolute terms om

cannot be created by the judge made law. In fact, it would depend on the facts and circumstances of a given case and it is not possible to state a strait-jacket formula which can B

universally be applied to all cases.

6. In the case of Salem Advocate Bar Association, T.N. v. Union of India, (2005) 6 SCC 344, a three Judge Bench of the Supreme Court examined the validity of the ::: Downloaded on - 09/06/2013 14:51:02 ::: 12

amended provisions of Order VI Rule 17 of the Code of Civil rt

Procedure and held as under :-

ou

"26. Order 6 Rule 17 of the Code deals with amendment of pleadings. By Amendment Act 46 of 1999, this provision was deleted. It has again C

been restored by Amendment Act 22 of 2002 but with an added proviso to prevent application for amendment being allowed after the trial has commenced, unless the court comes to the conclusion that in spite of due diligence, the party h

could not have raised the matter before the commencement of trial. The proviso, to some ig

extent, curtails absolute discretion to allow amendment at any stage. Now, if application is filed after commencement of trial, it has to be H

shown that in spite of due diligence, such amendment could not have been sought earlier. The object is to prevent frivolous applications which are filed to delay the trial. There is no y

illegality in the provision."

ba

7. In the case of Sampath Kumar v. Ayyakannu and om

Anr., JT 2002(7) SC 182, the Supreme Court held as under:- "9. Order 6 rule 17 of the CPC confers jurisdiction on the court to allow either party to B

alter or amend his pleadings at any stage of the proceedings and on such terms as may be just. Such amendments as are directed towards putting-forth and seeking determination of the real questions in controversy between the parties shall be permitted to be made. The question of delay in moving an application for amendment should be decided not by calculating the period from the date of institution of the suit alone but by reference to the stage to which the hearing in the suit has proceeded. Pre-trial amendments ::: Downloaded on - 09/06/2013 14:51:02 ::: 13

are allowed more liberally than those which are sought to be made after the commencement of rt

the trial or after conclusion thereof. In former case generally it can be assumed that the defendant is not prejudiced because he will have ou

full opportunity of meeting the case of the plaintiff as amended. In the latter cases the question of prejudice to the opposite party may arise and that shall have to be answered by C

reference to the facts and circumstances of each individual case. No strait-jacket formula can be laid down. The fact remains that a mere delay cannot be a ground for refusing a prayer for amendment."

h

ig

H

8. The principles in relation to amendment of pleadings have remained quite consistent over a considerable period of time but y

amendments which are necessary to provide a solution to the real ba

controversy between the parties without really altering, especially, the cause of action can be allowed and a hyper-technical approach need om

not be encouraged in relation to such law. Prejudice is one of the factors that may be considered by the Court but it is not the sole criteria for accepting or rejecting an application for amendment. B

Another important facet of the law of amendment is that the proposed amendment should not result in injustice to the other side and should not lead to unexplained withdrawal of an admission which had provided other party with the benefit of such an admission. These principles were referred with approval by the Supreme Court in the ::: Downloaded on - 09/06/2013 14:51:02 ::: 14

case of B.K. Narayana Pillai v Parameshwaran Pillai and another, rt

(2000) 1 SCC 712, where the Court held as under :- ou

"3. The purpose and object of Order 6 Rule 17 CPC is to allow either party to alter or amend his pleadings in such manner and on such terms as may be just. The C

power to allow the amendment is wide and can be exercised at any stage of the proceedings in the interests of justice on the basis of guidelines laid down by various High Courts and this Court. It is true that the h

amendment cannot be claimed as a matter of right and under all circumstances. But it is equally true that the ig

courts while deciding such prayers should not adopt a hypertechnical approach. Liberal approach should be the general rule particularly in cases where the other side H

can be compensated with the costs. Technicalities of law should not be permitted to hamper the courts in the administration of justice between the parties. Amendments are allowed in the pleadings to avoid y

uncalled-for multiplicity of litigation." ba

This principle was stated by the Supreme Court as back as in 1957 in om

the case of Pirgonda Hongonda Patil v Kalgonda Shidgonda Patil and others, AIR 1957 SC 363 and was again reiterated in the case of North Eastern Railway Administration, Gorakhpur v Bhagwan Das B

(Dead) by LRs, (2008) 8 SCC 511, where the Supreme Court held as under :-

"16. Insofar as the principles which govern the question of granting or disallowing amendments under Order 6 Rule 17 CPC (as it stood at the relevant time) are concerned, these are also well settled. Order 6 Rule 17 ::: Downloaded on - 09/06/2013 14:51:02 ::: 15

CPC postulates amendment of pleadings at any stage of the proceedings. In Pirgonda Hongonda Patil v Kalgonda rt

Shidgonda Patil, AIR 1957 SC 363 which still holds the field, it was held that all amendments ought to be allowed which satisfy the two conditions : (a) of not ou

working injustice to the other side; and (b) of being necessary for the purpose determining the real questions in controversy between the parties. Amendments should be refused only where the other party cannot be placed C

in the same position as if the pleading had been originally correct, but the amendment would cause him an injury which could not be compensated in costs. (Also see Gajanan Jaikishan Joshi v Prabhakar Mohanlal h

Kalwar, (1990) 1 SCC 166".

ig

9. In the case of Usha Balasaheb Swami and others v Kiran H

Appaso Swami and others, (2007) 5 SCC 602, the Supreme Court noticed that the provisions of Order 6 Rule 17 of the Code of Civil y

Procedure clearly confer the Courts with the power to allow, at any ba

stage of the proceedings, alterations and amendments of the pleadings and also explained the restriction placed in the proviso. om

The Court while specifying the distinction in law between amendment of a plaint and a written statement, indicated that the Courts would B

be more liberal while dealing with the application for amendment of written statement and held as under :- "19. It is equally well-settled principle that a prayer for amendment of the plaint and a prayer for amendment of the written statement stand on different footings. The general principle that amendment of pleadings cannot be allowed so as to alter materially or substitute cause of ::: Downloaded on - 09/06/2013 14:51:02 ::: 16

action or the nature of claim applies to amendments to plaint. It has no counterpart in the principles relating to rt

amendment of the written statement. Therefore, addition of a new ground of defence or substituting or altering a defence or taking inconsistent pleas in the ou

written statement would not be objectionable while adding, altering or substituting a new cause of action in the plaint may be objectionable. C

20. Such being the settled law, we must hold that in the case of amendment of a written statement, the courts are more liberal in allowing an amendment than that of a plaint as the question of prejudice would be far less in h

the former than in the latter case (see B.K. Narayana Pillai v Parameswaran Pillai (2000) 1 SCC 712 and ig

Baldev Singh v Manohar Singh, (2006) 6 SCC 498). Even the decision relied on by the plaintiff in Modi Spg. (1976) 4 SCC 320, clearly recognises that inconsistent H

pleas can be taken in the pleadings. In this context, we may also refer to the decision of this Court in Basavan Jaggu Dhobi v Sukhnandan Ramdas Chaudhary, 1995 Supp (3) SCC 179. In that case, the defendant had initially taken up the stand that he was a joint tenant y

along with others. Subsequently, he submitted that he ba

was a licensee for monetary consideration who was deemed to be a tenant as per the provisions of Section 15-A of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. This Court held that the om

defendant could have validly taken such an inconsistent defence. While allowing the amendment of the written statement, this Court observed in Basavan Jaggu Dhobi case as follows : (SCC p. 180, para 3) B

" 3. As regards the first contention, we are afraid that the courts below have gone wrong in holding that it is not open to the defendant to amend his written statement under Order 6 Rule 17 CPC by taking a contrary stand than what was stated originally in the written statement. This is opposed to the settled law. It is open to a defendant to take even contrary stands or contradictory stands, thereby the cause of action is not in any manner affected. That will apply only to a case of the plaint being amended so as to introduce a new cause of action.""

::: Downloaded on - 09/06/2013 14:51:02 ::: 17

rt

10. Another purpose of taking a liberal approach while dealing with amendment application is to ensure that there is no ou

multiplicity of litigation and furthermore the rights of the parties are not jeopardize to an extent that the real controversy between the C

parties becomes incapable of solution. The purpose before the Court keeping in view the scheme of the Code is to frame issues on all h

factual matters which the parties are at dispute and then to record ig

finding on each issue while giving the parties chance to lead evidence H

in support of their respective claims. The purpose is to ensure complete adjudication of the real dispute and controversy between the parties. The amendments which are necessary for determination y

ba

of real controversy in the suit can be allowed and it will take within its ambit inconsistent pleas particularly when they are taken as om

alternative pleas. Much greater care is needed to be taken by the Court where there are inconsistent/destructive pleas which would vary the cause of action and cause great prejudice or loss of an B

accrued right to the other side. In such cases the Court would be justified in rejecting an application for amendment. It is well settled law that though the rights of the parties have normally to be decided as on the date of the suit, but in the interest of justice subsequent events normally would form a sufficient ground for favourably ::: Downloaded on - 09/06/2013 14:51:02 ::: 18

considering the application for amendment of the written statement. rt

It may be more so where the amendments are being claimed on the basis of some benefits without altering the cause of action and ou

primarily founded on subsequent events. Alternative pleas which are not destructive of each other can be considered by the Court C

particularly when the application moved is not intended to delay the suit unnecessarily. (See Mehar v Yash Pal, 1999 (1) PLR 403). h

Another settled principle is that amendments prayed for as a result of ig

subsequent events, the Court is not concerned with the merits of the H

amendments i.e. it is not for a Court to examine whether on the amended facts the Petitioner will succeed or fail. It is a matter to be y

gone into during the trial of the suit and is not a relevant ba

consideration for considering an application for amendment unless the amendment otherwise was impermissible in law. (See Baldev Raj om

v Municipal Committee Palwal and another, 1993 (3) PLR 573).

11. Reverting back to the facts of the present case, it is clear B

that the written statement on behalf of the present Respondent had been filed on 31st October, 2007. All the decisions of the authorities concerned including the Government of India which are sought to be introduced by way of amendment are of subsequent period. The affidavit which was filed by the Union of India discloses certain ::: Downloaded on - 09/06/2013 14:51:02 ::: 19

material facts and its policy decision taken on 13th January, 2009. rt

The details of all these facts have been given by the Respondent/Applicant in the affidavit-in-support of the Chamber ou

Summons in paragraphs 4(i) to 4(ix). The Government decisions that have been stated therein relate to the dates of 28th May, 2008 C

and 23rd October, 2008; and 9th January, 2009, respectively. It has been averred that despite their due diligence, the Applicant could not h

have brought these facts on record because relevancy of these facts ig

have been pleaded as, according to the Applicant, Empowered Group H

of Ministers' decisions have a bearing on the concept of gas utilization policy which in turn is a general and specific policy in regard to the utilization as well as pricing of the natural gas. An y

ba

ancillary but an important question that has to be further considered by us is the relevancy of these amendments for complete, proper and om

just adjudication of the dispute between the parties. We have already noticed in some details at the opening of this judgment the facts pleaded by the parties in their respective pleadings. After B

denying various averments made in the plaint, the Respondent had taken the stand that there was no concluded subsisting agreement between the parties and as such the suit for specific performance would not lie. By way of amendment, the Respondent wants to add an alternative plea on the basis of the same cause of action within the ::: Downloaded on - 09/06/2013 14:51:02 ::: 20

ambit and scope of the existing suit and by referring the subsequent rt

events that even if there was a contract it stands frustrated as it is incapable of being performed because of these subsequent events. ou

Thus, it is difficult for the Court to hold that the subsequent events are not relevant. They have a specific bearing upon the factual C

matrix of the case. The dispute between the parties as well as the issues would require determination of the Court to completely and h

finally dispose of the suit in accordance with law. The relevancy is ig

the construction of limited scope and the merits of the amended H

pleading is not of much consequence. It is nobody's case that the amendment sought to be made by the present Respondents are y

barred by any law, per se.

ba

12. It is well settled principle of law that it is open to the om

parties to raise even mutually inconsistent pleas and if the relief could be founded on the alternative plea, it could be granted. ( Ref : Arundhati Mishra (Smt.) v. Sri Ram Charitra Pandey, (1994)2 SCC B

29.)

13. A very serious objection has been raised on behalf of the NTPC on the ground that the trial in the present case has already commenced and therefore, the application for amendment would be ::: Downloaded on - 09/06/2013 14:51:02 ::: 21

liable to be rejected in face of the proviso to Order VI Rule 17 of the rt

Code of Civil Procedure. This argument at a first glance is attractive but when examined in some depth with reference to the facts and ou

circumstances of the case, we hardly find any merit in the submissions. The principal provision of Order VI Rule 17 of the Code C

is the Court to permit the amendment of the pleadings at any stage of the suit. Of course, this jurisdiction and discretion of the Court is to h

be exercised cautiously and in accordance with well settled cannons ig

of civil jurisprudence. The proviso while imposes a limitation of H

exercise of power of the Court to allow amendment there it clearly states that the amendment can be allowed even after commencement of a trial where despite due diligence, an Applicant was not able to y

ba

bring the facts on record. Thus, the test is exercise of due diligence and bonafide of the applicant. In the case of Usha Devi v. Rijwan om

Ahamd & Ors., (2008)3 SCC 717, the Supreme Court noticed as under: -

"12. He lastly submitted that the prayer for amendment B

was made after the commencement of the trial and the trial court had, therefore, rightly rejected the prayer. He maintained that the trial of the suit would commence with the settlement of the issues. In support of the submission that the framing of the issues marked the commencement of trial of the suit, Mr. Sharma, relied upon the decision of this Court in Ajendraprasadji N. Pandey v. Swami Keshavprakeshdasji N., (2006)12 SCC

1. In para 57 of the decision, it was observed as follows: (SCC p.18)

::: Downloaded on - 09/06/2013 14:51:02 ::: 22

"57. It is submitted that the date of settlement of issues is the date of commencement of trial. (Kailash v. rt

Nankhu, (2005)4 SCC 480). Either treating the date of settlement of affidavit which is treated as examination- in-chief as date of commencement of trial, the matter ou

will fall under proviso to Order 6 Rule 17 CPC. The defendant has, therefore, to prove that in spite of due diligence, he could not have raised the matter before the commencement of trial. We have already referred to the C

dates and events very elaborately mentioned in the counter-affidavit which proves lack of due diligence on the part of Defendants 1 and 2 (the appellants )" (emphasis supplied) h

From the above quoted passage, it appears that the ig

decision did not hold that settlement of issues marks the commencement of trial. Earlier in the decision, the Court exhaustively examined the proceedings from date H

to date and on that basis came to hold and find that the prayer for amendment was made after the commencement of trial."

"15. In view of the decision in Sajjar Kumar (2005) 13 y

SCC 89 we are of the view that this appeal too deserves ba

to be allowed. We may clarify here that in this order we do not venture to make any pronouncement on the larger issue as to the stage that would mark the commencement of trial of a suit but we simply find that om

the appeal in hand is closer on facts to the decision in Sajjan Kumar and following that decision the prayer for amendment in the present appeal should also be allowed.

B

xxxx xxxxx xxxxx

18. This appeal is accordingly allowed. The orders of the trial court and the High Court are set aside and it is directed that the appellant may be allowed to make the proposed amendment in the plaint subject to payment of Rs.10,000 as cost to the respondent-defendants. The amendment will be allowed in case the amount of cost is paid within two months from today." ::: Downloaded on - 09/06/2013 14:51:02 ::: 23

rt

14. In the present case certain issues were framed and evidence by way of affidavit had been filed. If we assume this as ou

commencement of the trial even then we are of the considered view that there is sufficient ground that the Applicant could not bring the C

facts on record despite exercise of due diligence inasmuch as practically all the events occurred subsequent to the filing of the h

written statement. The Applicants have acted with due diligence and ig

bonafidely. There is no occasion for the Court to disturb the order H

passed by the learned Single Judge. Furthermore, the learned Single Judge has exercised its judicial discretion and we find no error in the impugned order as a result of which any interference of this Court is y

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called for.

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15. Learned counsel appearing for the Respondents had raised an objection with regard to the maintainability of the present B

appeal, as, according to him, in view of the judgment in the case of Shah Babulal Khimji v. Jayaben D. Kania & Anr., (1981)4 SCC 8, and Full Bench Judgment of this Court in the case of Mohd. Riyazur Rehman Siddiqui v. Deputy Director of Health Services, 2008 (6) Mh.L.J. 941, the present appeal is not maintainable as by allowing ::: Downloaded on - 09/06/2013 14:51:02 ::: 24

the application, no rights of the parties have been decided. There is rt

no determination finally or otherwise of any of the issues that are subject matter of the suit and as such the appeal would not be ou

maintainable. On the other hand, learned counsel appearing for the Appellant while relying upon some part of the same judgments C

contended that the same appeal would be maintainable. h

16.

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In Paragraph 120 of Shah Babulal Khimji's case (supra), H

the Supreme Court had spelled out certain illustrations of interlocutory orders which may be judgment and therefore y

appealable. Sn order granting leave to amend the plaint by ba

introducing a new cause of action which completely alters the nature of the suit and takes away a vested right of limitation or any other om

valuable right accrued to the defendant, the order would be appealable. Furthermore, this is an order which to an extent certainly decide the right of the parties. To the extent and in the B

sense that earlier RIL could not have pleaded frustration of contract and its case was restricted only to there being no binding and subsisting contract. Allowing this alternative plea and to some extent inconsistent has given a cause to the NPTC to raise grievance in the appeal as the order passed by the learned Single Judge would in the ::: Downloaded on - 09/06/2013 14:51:02 ::: 25

facts and circumstances of the case be a judgment within the rt

meaning of Clause 15 of the Letters Patent Act. But for such amendment, the appellant could not have pleaded and the ou

Respondents were not required to meet the case of frustration of contract. Thus, to that extent, the rights of the parties stand affected. C

Even in the case of Jugal Kishore Paliwal v. S. Sat Jit Singh & Anr., (1984)1 SCC 358, the Supreme Court had held that an order refusing h

amendment of written statement at the time of framing of issues ig

would certainly not be a purely interlocutory order against which no H

Letters Patent Appeal would lie and following the view taken in Shah Babulal Khimji's case (supra), the order was held to be appealable. y

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17. Even the Full Bench of this Court in the case of Mohd. Riyazur Rehman Siddiqui (supra), while discussing Clause 15 of the om

Letters Patent, had explained the word "judgment" appearing in the clause, and observed that the word "judgment" has undoubtedly a concept of finality in a broader and not a narrower sense. B

18. The nature of the right affected is also a relevant consideration. The right in strict sense is duty which is something owed by one to another. Correspondingly the latter has a right against the former. Every legal right has distinguishable ::: Downloaded on - 09/06/2013 14:51:02 ::: 26

characteristics, like it is vested in a person, it is available against a rt

person and such right is enforceable in accordance with the provisions of law. Right to appeal is a statutory right. It is neither ou

natural nor fundamental right. Such rights are capable of being determined by judgment of the Court of law. The judgment therefore C

could be order which is determinative of some substantial controversy between the parties and is prejudicially affecting their h

rights in the trial. It is said that effect of an order, whatever its form ig

may be, would depend on the nature of the application on which it is H

made if it puts an end to the suit or proceedings so far the Court before which the suit or proceedings is pending is concerned and it is something more than a mere formal expression of adjudication. y

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19. Applying these tests to the present case, we have already om

noticed that the order passed by the Court substantially affects the rights of the parties as the nature and scope of the suit itself would be on a different footing for such an amendment. Therefore, we are of B

the considered view that the present appeal is maintainable and the objections raised by the Respondents is without merit. Hence, we decline to reject the argument as to the maintainability of the present appeal.

::: Downloaded on - 09/06/2013 14:51:02 ::: 27

20. For the reasons afore-stated, we find no merit in the rt

contentions raised by the Appellant but would modify the order of the learned Single Judge only to the extent that the Respondent shall ou

be liable to pay costs of Rs.25,000/- (Rupees Twenty Five thousand only) for seeking amendment in question. C

h

ig CHIEF JUSTICE H

A.M. KHANWILKAR, J.

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uday/judgments09/appeal229-09

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