TMI Blog2009 (11) TMI 1007X X X X Extracts X X X X X X X X Extracts X X X X ..... It is claimed that some properties were purchased by Kailash Berry in his name, and others, jointly with Defendant Nos 1, 2 and Defendant No. 4. It is claimed that certain other properties were also purchased by the late Kailash Berry in the sole name of Defendant No. 1 or Defendant No.4. The properties so held either in the name of the defendants, or jointly, it is urged, are in a fiduciary capacity, for the benefit of the deceased. The plaintiff alleges that Defendant No.1 separated from her husband in 1968 and was living with the deceased, who used to care for her; it is contended that the Defendant No. 4 was disliked by the deceased, and used to depend on him (the deceased) during his life time. Similarly, it is alleged that the defendant No. 2 (apparently the son of a predeceased brother of the deceased Kailash Berry) was in jail in England. The deceased had a power of attorney, and used it to acquire several movable and immovable properties for the benefit of his family, with the intention of creating an empire. 3. It is submitted that during his lifetime, the deceased used to operate all the accounts, and manage his investments, even though some of them were in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it No. 586/2006 to be dismissed as withdrawn and observed that the plaintiff there (i.e the Defendant No. 3 here) could seek such remedies as were available in law. The present plaintiff was co-plaintiff in that suit, and had been granted transposition as defendant, by previous order dated 6-4-2009. She did not object to dismissal of CS (OS) 586/2006; nor did she seek transposition back as plaintiff. The plaintiff in that suit, nor the present plaintiff, sought leave- at that time, to file another suit. Though the plaintiff filed the present suit on 25th February, 2009, during pendency of the previous suit, the court had not issued summons. Both the suits were listed together, when the other suit was dismissed as withdrawn. In these circumstances, the plaintiff was asked to address the court about maintainability of the suit, in the light of provisions of Order II, Rule 2, CPC, and Order 23, Rule 1. The other question of maintainability pertained to applicability of provisions of the Benami Transactions (Prohibition) Act, 1988. 6. Arguing about applicability of Order II, Rule 2, the plaintiff submits that there is a material difference between the two suits - the previous one, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht leave to be, and was permitted to transpose herself as defendant. Without leave of court, she filed the present suit; notice was not issued. In the meanwhile, the previous suit was withdrawn. At that stage, the court heard arguments about maintainability of the present suit. 9. The first question is whether the present suit, filed before the withdrawal of the previous suit- or even the plaintiff's transposition, asking for the same, was considered and allowed, is maintainable. The provisions under the Civil Procedure Code (CPC) in this regard are extracted below: Order 2 Rule 2. Suit to include the whole claim. (1) Every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action; but a plaintiff may relinquish any portion of his claim in order to bring the suit within the jurisdiction of any court. (2) Relinquishment of part of claim. - Where a plaintiff omits to sue in respect of, or intentionally relinquishes, any portion of his claim, he shall not afterwards sue in respect of the portion so omitted or relinquished. (3) Omission to sue for one of several reliefs. - A person entitled to more than one r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ituting any fresh suit in respect of such subject-matter or such part of the claim. (5) Nothing in this rule shall be deemed to authorise the Court to permit one of several plaintiffs to abandon a suit or part of a claim under sub-rule (1), or to withdraw, under sub-rule (3), any suit or part of a claim, without the consent of the other plaintiffs.] 1-A. When transposition of defendants as plaintiffs may be permitted.--Where a suit is withdrawn or abandoned by a plaintiff under Rule 1, and a defendant applies to be transposed as a plaintiff under Rule 10 of Order I, the Court shall, in considering such application, have due regard to the question whether the applicant has a substantial question to be decided as against any of the other defendants.] ............. ................... ............... In State of Maharashtra v. National Construction Co., (1996) 1 SCC 735, the Supreme Court explained the rationale and working of Order 2, Rule 2 as follows: Both the principle of res judicata and Rule 2 of Order 2 are based on the rule of law that a man shall not be twice vexed for one and the same cause. In the case of Mohd. Khalil Khan v. Mahbub Ali Mian3 the Privy Coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this case. Since the plaintiff withdrew from the previous suit, without seeking any leave, to file the present suit, and rather only sought transposition, and even at a later stage, did not object to the withdrawal of the suit, Order 2 Rule 2 precludes this suit. 11. The court is also of the opinion that Order 23 Rule 1 (4) precludes the present suit. That provision precludes a latter suit, in respect of the same subject matter, if the plaintiff withdraws the previous suit, or part of the claim, or withdraws from the suit, without seeking leave to file another suit, for that cause. A latter suit, for the same cause of action is barred. This provision -even before its amendment was commented upon by the Supreme Court, in Hulas Rai Baij Nath v. Firm K.B. Bass Co., AIR 1968 SC 111 thus: The language of order 23 Rule 1 sub-rule (1) CPC, gives an unqualified right to a plaintiff to withdraw from a suit and, if no permission to file a fresh suit is sought under sub-rule (2) of that Rule, the plaintiff becomes liable for such costs as the Court may award and becomes precluded from instituting any fresh suit in respect of that subject-matter under sub-rule (3) of that Rule. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bservations of E. S. Venkataramiah, J. (as the learned Chief Justice then was) are to be quoted here : (SCC p. 12, para 9) [W]e are of the view that the principle underlying Rule 1 of Order 23 of the Code should be extended in the interests of administration of justice to cases of withdrawal of writ petition also, not on the ground of res judicata but on the ground of public policy as explained above. It would also discourage the litigant from indulging in bench-hunting tactics. In any event there is no justifiable reason in such a case to permit a petitioner to invoke the extraordinary jurisdiction of the High Court under Article 226 of the Constitution once again. While the withdrawal of a writ petition filed in the High Court without permission to file a fresh writ petition may not bar other remedies like a suit or a petition under Article 32 of the Constitution of India since such withdrawal does not amount to res judicata, the remedy under Article 226 of the Constitution of India should be deemed to have been abandoned by the petitioner in respect of the cause of action relied on in the writ petition when he withdraws it without such permission. Now, in this case, the plai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion to outlaw the practise of benami transactions, whereby someone purchases, or holds property, on behalf of the other. The practice is made subject matter of an offence; Section 3 prohibits it. To give teeth to this intention, actions and suits, on the part of the real owners against benamidars, or ostensible owners, are not maintainable. Section 4(3) provides for exceptions to such a rule; in the event the ostensible owner claims that the benamidar holds the property, in a fiduciary capacity, and establishes it, the suit lies. 14. As to what is a fiduciary capacity has been explained by the Supreme Court, in Canbank Financial Services -vs- Custodian AIR 2004 SC 5123, as follows: Fiduciary duty : Chapter IX of the Indian Trusts Act provides for certain obligations in the nature of trusts. The Trusts Act recognizes various kinds of trusts including resulting trust. An express trust, however, may be created by reason of an agreement between the parties, (Barclays Bank Ltd. v. Quistclose Investments Ltd. [1970] AC 567 (HL)) ([1969] 39 Comp Cas 105 (HL)). By reason of section 88 of the Indian Trusts Act, a person bound in fiduciary character is requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fiduciary capacity for Defendant No. 1. This event is neither pleaded nor substantiated even prima facie through any document filed along with the plaint. Even if the plaint is read as it stands, no case is made out to show that Defendant No. 3 was in fact holding the property at 32, Sultanpur Farms, Mehrauli, New Delhi in any fiduciary capacity for Defendant No. 1. Viewed from any angle, the bar under Section 4 of the Benami Act would apply and prevent the Plaintiff from claiming any relief vis-a-vis the properties shown to be owned by Defendant No. 3 and FMPL. 15. According to Law Lexicon, one acts in a fiduciary capacity, in the following circumstances: One is said to act in a fiduciary capacity or to receive, money or contract a debt in a fiduciary capacity , when the business which he trasnsacts. or the money or property which he handles, is not his own or for his own benefit, but for ' the benefit of another person, as to whom he stands in a relation implying and necessitating great confidence and trust on the one part and a high degree of good faith on the other part. The term is not restricted to technical or express trusts, but includes also such offi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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