TMI Blog2009 (10) TMI 963X X X X Extracts X X X X X X X X Extracts X X X X ..... not be permitted and that too after a lapse of four years after the institution of the suit. The High Court has set aside the order of the trial court which allowed the amendment under Order VI Rule 17 CPC. HELD THAT:- In our considered view, Order VI Rule 17 is one of the important provisions of the CPC, but we have no hesitation in also observing that this is one of the most misused provision of the Code for dragging the proceedings indefinitely, particularly in the Indian courts which are otherwise heavily overburdened with the pending cases. All Civil Courts ordinarily have a long list of cases, therefore, the Courts are compelled to grant long dates which causes delay in disposal of the cases. The applications for amendment lead to further delay in disposal of the cases. It may be pertinent to mention that with a view to avoid delay and to ensure expeditious disposal of suits, Rule 17 was deleted on the recommendation of Justice Malimath Committee by the Code of Civil Procedure (Amendment) Act, 1999 but because of public uproar, it was revived. Justice C.K. Thakker, an eminent former Judge of this Court in his book on Code of Civil Procedure (2005 Edition) incorporated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... must be exercised judiciously and with great care. COSTS:- The Courts have consistently laid down that for unnecessary delay and inconvenience, the opposite party must be compensated with costs. The imposition of costs is an important judicial exercise particularly when the courts deal with the cases of amendment. The costs cannot and should not be imposed arbitrarily. In our view, the following parameters must be taken into consideration while imposing the costs. We can conclude our discussion by observing that while deciding applications for amendments the courts must not refuse bona fide, legitimate, honest and necessary amendments and should never permit mala fide, worthless and/or dishonest amendments. When we apply these parameters to the present case, then the application for amendment deserves to be dismissed with costs of ₹ 1,00,000/- (Rupees One Lakh) because the respondents were compelled to oppose the amendment application before different Courts. This appeal being devoid of any merit is accordingly dismissed with costs. - Dalveer Bhandari and H.S. Bedi, JJ. For Appellant: Mukul Rohtagi, Sr. Adv., Navkesh Batra, Sandeep Narain, Shri Narain, Ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2(A). With the enactment of the Urban Land (Ceiling Regulation) Act, 1976, the first defendant firm was prohibited from holding vacant land in excess of ceiling limits. As provided by the said Act, such vacant land, in excess of ceiling limits, was liable to be acquired by the State Government. Therefore, the first defendant firm applied to the State Government for exemption, under Section 20(1) of the said Act, and sought permission to hold excess vacant land to an extent admeasuring 16194 square metres. Vide Government Order dated 17.07.85, in exercise of its power under Section 20(1) of the said Act, the state government permitted the first defendant firm to hold the excess vacant land. Subsequently, as stated in para 4 hereinafter, the first defendant firm made another application to the state government to exempt the balance excess vacant land admeasuring 3444 square metres and the same was permitted by the state government vide its order dated 18.04.87. Thus, the entire extent of vacant land in excess of ceiling limits admeasuring a total aggregate extent of 19638 square metres was exempted, by the state government, under Section 20(1) of the said Act. 2(B). Thereafter, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermitted by any court of law. It was further submitted by the respondents that by the order of the trial court the rights accrued to the respondents have been taken away. 9. The respondents submitted that the original suit was instituted for recovery of ₹ 52,97,111/-. Alternatively, the appellant requested the court to declare it as the absolute owner based on the basis of sale deed dated 30.9.1987 and direct the respondents to deliver vacant possession of the plaint schedule property. The respondents also submitted that the appellant relying upon the sale deed dated 30.9.1987 requested the court to declare it as the absolute owner and since it sought possession of the property from the respondents meaning thereby that the respondents are in possession of the entire suit property. If the appellant are in possession of only a portion of the suit property, the same ought to have been mentioned in the plaint and the prayer in respect of the same would be limited and not seeking relief of possession in respect of the entire suit property. Now by virtue of the amendment, the appellant is trying to contend that the respondents are to be treated as trespassers and unauthorized oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... endment is necessary to elucidate the real points in controversy. It was also submitted by the appellant that the amendment will not cause any prejudice to the respondents. It was also submitted that the stand taken up by the respondents is totally dishonest, wrong and not bona fide. The appellant submitted that the court should be liberal in allowing amendments and the respondents be compensated by costs. 16. The learned Counsel for the respondents submitted that in the original plaint, the appellant rightly sought only for recovery of sale price relying on Section 65 of the Contract Act. Section 65 of the Contract Act is as follows: When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it. 17. The original plaint expressly so avers and relies on Section 65 of the Contract Act clearly admitting that the sale deed has become void. This admission is now sought to be got rid off and the sale deed is sought to be asserted as valid. It was submitted that the appellant cannot, therefore, see ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r case.... 20. The learned Counsel for the respondents further relied on the decision in Heeralal v. Kalyan Mal and Ors. (1998) 1 SCC 278 wherein the court proceeded on the basis that the earlier admissions of the defendant cannot be allowed to be withdrawn. The Court examined the facts and held that the defendant cannot be permitted to withdraw any admission already made. 21. The respondents have also relied on the decision in Gautam Sarup v. Leela Jetley and Ors. (2008) 7 SCC 85. In the said case, it was held that by amendment the admission in the original pleadings cannot be sought to be got rid off. 22. In Modi Spinning Weaving Mills Co. Ltd. and Anr. v. Ladha Ram Co. (1976) 4 SCC 320, the trial court while rejecting an application under Order VI Rule 17 said that the repudiation of clear admission is motivated to deprive the plaintiff of the valuable right accrued to him and it is against law. The High Court on revision affirmed the judgment of the trial court and held that by means of amendment the defendant wanted to introduce an entirely different case and if such amendments were permitted it would prejudice the other side. 23. In the said case, a three-Judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct cause of action to be substituted for another, nor to change, by means of amendment, the subject-matter of the suit. 26. When we apply the principle laid down by the above judgments, the conclusion becomes irresistible that the view taken by the High Court in the impugned judgment cannot be said to be unjustified. 27. We are tracing the legislative history, objects and reasons for incorporating Order VI Rule 17 not because it is necessary to dispose of this case, but a large number of applications under Order VI Rule 17 are filed and our courts are flooded with such cases. Indiscriminate filing of applications of amendments is one of the main causes of delay in disposal of civil cases. In our view, clear guideline may help disposing off these applications satisfactorily. 28. We deem it appropriate to give historical background of Rule 17 of Order VI corresponds to Section 53 of the Old Code of 1882. It is similar to Order 21 Rule 8 of the English Law. Order VI Rule 17 CPC reads as under: Amendment of Pleadings.-- The Court may at any stage of the proceedings allow either party to alter or amend his pleadings in such manner and on such terms as may be just, and all su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had to be incurred by the victim of the amendment. The Court must scientifically evaluate the reasons, purpose and effect of the amendment and all these factors must be taken into consideration while awarding the costs. 32. To curtail delay in disposal of cases, in 1999 the Legislation altogether deleted Rule 17 which meant that amendment of pleading would no longer have been permissible. But immediately after the deletion there was widespread uproar and in 2002 Rule 17 was restored, but added a proviso. That proviso applies only after the trial has commenced. Prior to that stage, the situation remains as it was. According to the view of the learned author Arun Mohan as observed in his book, although the proviso has improved the position, the fact remains that amendments should be permissible, but only if a sufficient ground therefore is made out, and further, only on stringent terms. To that end, the rule needs to be further tightened. 33. The general principle is that courts at any stage of the proceedings may allow either party to alter or amend the pleadings in such manner and on such terms as may be just and all those amendments must be allowed which are imperative for d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herwise. (Emphasis added) 37. In another leading English case Weldon v. Neal (1880) 19 QBD 394 : 56 LJ QB 6219, A filed a suit against B for damages for slander. A thereafter applied for leave to amend the plaint by adding fresh claims in respect of assault and false imprisonment. On the date of the application, those claims were barred by limitation though they were within the period of limitation on the date of filing the suit. The amendment was refused since the effect of granting it would be to take away from B the legal right (the defence under the law of limitation) and thus would cause prejudice to him. 38. The rule, however, is not a universal one and under certain circumstances, such an amendment may be allowed by the court notwithstanding the law of limitation. The fact that the claim is barred by law of limitation is but one of the factors to be taken into account by the court in exercising the discretion as to whether the amendment should be allowed or refused, but it does not affect the power of the court if the amendment is required in the interests of justice. Ganga Bai v. Vijai Kumar (1974) 2 SCC 393; Arundhati Mishra v. Sri Ram Charitra Pandey (1994) 2 SCC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h satisfy the two conditions (a) of not working in justice to the other side, and (b) of being necessary for the purpose of determining the real questions in controversy between the parties. 42. In a concurring judgment, Beaman, J. observed that the practice is to allow all amendments, whether introducing fresh claims or not, so long as they do not put the other party at a disadvantage for which he cannot be compensated by costs. His Lordship proceeded to state: In my opinion two simple tests, and two only, need to be applied, in order to ascertain whether a given case is within the principle. First, could the party asking to amend obtain the same quantity of relief without the amendment? If not, then it follows necessarily that the proposed amendment places the other party at a disadvantage, it allows his opponent to obtain more from him than he would have been able to obtain but for the amendment. Second, in those circumstances, can the party thus placed at a disadvantage be compensated for it by costs? If not, then the amendment ought not, unless the case is so peculiar as to be taken out of the scope of the rule, to be allowed. 43. In Amulakchand Mewaram and Ors. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he quality and quantity of the reliefs sought remained the same. Since the amendment did not introduce a new case, the defendant was not taken by surprise. 48. In Pursuhottam Umedbhai Co. v. Manilal Sons AIR 1961 SC 325 a suit was instituted in the name of the firm by the partners doing business outside India. It was held that there was only mis-description of the plaintiff. The plaint in the name of the firm was not a nullity and could be amended by substituting the names of partners. 49. In similar circumstances, in a subsequent case Ganesh Trading Co. v. Moji Ram (1978) 2 SCC 91, this Court reiterated the law laid down in Purushottam Umedbhai Co. (supra). The Court observed: It is true that, if a plaintiff seeks to alter the cause of action itself and to introduce indirectly, through an amendment of his pleadings, an entirely new or inconsistent cause of action, amounting virtually to the substitution of a new plaint or a new cause of action in place of what was originally there, the Court will refuse to permit it if it amounts to depriving the party against which a suit is pending of any right which may have accrued in its favour due to lapse of time. But, mere f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther observed that since there was no addition to the averments or relief, it was not possible to uphold the contention of the plaintiff that by conversion of written statement into a plaint in a cross-suit, a fresh claim was made or a new relief was sought. To the facts of the present case, therefore, the decisions holding that amendments could not ordinarily be allowed beyond the period of limitation and the limited exceptions to that rule have no application. 53. In Jai Jai Ram Manohar Lal v. National Building Material Supply (1969) 1 SCC 869, A sued B in his individual name but afterward sought leave to amend the plaint to sue as the proprietor of a Hindu Joint Family business. The amendment was granted and the suit was decreed. The High Court, however, reversed the decree observing that the action was brought by a `non-existing person'. 54. Reversing the order of the High Court, this Court (per Shah, J., as he then was) made the following oft-quoted observations: Rules of procedure are intended to be a handmaid to the administration of justice. A party cannot be refused just relief merely because of some mistake, negligence, inadvertence or even infraction of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alter or amend his pleadings in such manner and on such terms as may be just. The 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 the Supreme Court. It is true that the amendment cannot be claimed as a matter of right and under all circumstances. But it is equally true that the courts while deciding such prayers should not adopt hypertechnical approach. Liberal approach should be the general rule particularly in cases where the other side 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 uncalled for multiplicity of litigation. 60. In Suraj Prakash Bhasin v. Raj Rani Bhasin and Ors. (1981) 3 SCC 652, this Court held that liberal principles which guide the exercise of discretion in allowing amendment are that multiplicity of proceedings should be avoided, that amendments which do not totally alter the character of an action should be readily granted while care should be taken to see that injust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar- ty at the cost of other party should be properly calculated in terms of money and the costs be awarded accordingly. (iv) The imposition of costs should not be symbolic but realistic; (v) The delay and inconvenience caused to the opposite side must be clearly evaluated in terms of additional and extra court hearings compelling the opposite party to bear the extra costs. (vi) In case of appeal to higher courts, the victim of amendment is compelled to bear considerable additional costs. All these aspects must be carefully taken into consideration while awarding the costs. 66. The purpose of imposing costs is to: a) Discourage malafide amendments designed to delay the legal proceedings; b) Compensate the other party for the delay and the inconvenience caused; c) Compensate the other party for avoid- able expenses on the litigation which had to be incurred by opposite party for opposing the amendment; and d) To send a clear message that the parties have to be careful while drafting the original pleadings. FACTORS TO BE TAKEN INTO CONSIDERATION WHILE DEALING WITH APPLICATIONS FOR AMENDMENTS: 67. On critically analyzing both the English and Indian case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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