Revajeetu Builders & Developers Vs. M/S. Narayanaswamy & Sons &
Ors.  INSC 1647 (9 October 2009)
SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.6921 OF
out of SLP (c) No.1552 OF 2007) Revajeetu Builders & Developers .....
Appellant Versus Narayanaswamy & Sons & Others ..... Respondents
This appeal is directed against the judgment and order dated
16.9.2006 passed by the High Court of Karnataka at Bangalore in Writ Petition
No.36550 of 2003.
Brief facts in nutshell are as under:
appellant (original plaintiff) filed an Original Suit no. 2265 of 1996 before
the XXXI Additional City Civil Judge, Bangalore against the respondents
(defendant nos. 1 to 10) for recovery of Rs.52,97,111/with interest at the rate
of 18% per annum from the date of filing of suit till payment. The appellant
alternatively had taken the plea that if the court for any reason comes to the
conclusion that a decree for a sum of Rs.52,97,111/cannot be passed as prayed
by the appellant against respondents (original defendant nos. 1 and 2), then
the court may at least pass a decree for Rs.19,12,500/with interest at the rate
of 18% from the date of suit till the date of realization against the
The appellant also claimed that it be declared absolute owner of
the scheduled property on the basis of the sale deed dated 30.9.1987. The sale
deed was executed by the respondents in favour of the appellant after obtaining
permission from the State of Karnataka under the provisions of the Urban Land
(Ceiling & Regulation) Act, 1976.
A petition in public interest was filed by one S. Vasudeva which
ultimately came up before this Court in Civil Appeal Nos.1454-56 of 1993
challenging the aforementioned transfer of land. This court in those
proceedings held that the sale deed executed by the respondent in favour of the
appellant on 30.9.1987 is held to be invalid and inoperative. It may be
pertinent to mention that after the institution of the suit, the Urban Land
(Ceiling and Regulation) Act, 1976 has been repealed.
After the Act has been repealed, the appellant filed an
application under Order VI Rule 17 of the Code of Civil Procedure, 1908 (for
short `CPC') seeking leave of the trial court to add two additional paragraphs
as 2(A) and (B) and few prayers and to delete certain paragraphs in the plaint
and also to delete the prayer (a), (b) and (c).
2(A) and (B) are set out as under:
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.
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
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
Thereafter, the defendant firm approached the plaintiff and offered to sell, to
the plaintiff, an extent of 5 acres 24 guntas in survey nos.6/1 and 6/2,
Dasarahalli, VI Block, Jayanagar, Bangalore, together with building thereon.
This extent of 5 acres 24 guntas comprised of 19638 square feet of excess
vacant land, in addition to the land with buildings and vacant land within
ceiling limits. The first defendant firm, therefore, obtained permission from
the state government under orders dated 06.03.87 and 18.04.87 to sell to the
plaintiffs, the excess vacant land admeasuring 19638 square metres, as set out
in paras 3 and 4 hereinafter.
thereto, the first defendant firm executed a registered Sale Deed dated
30.09.87 in respect of the total aggregate extent of 5 acres 24 guntas i.e.
including the excess vacant land admeasuring 19638 square metres as aforesaid
(19638 sq. metres)."
The appellant sought to add the following prayers in the plaint by
an amendment in the plaint:(a) to declare that from 1.4.1988, the defendants
are trespassers and or in unauthorized occupation of the building which they
were permitted, under the Sale Deed dated 30.9.1987 to use as a licensee till
issue a mandatory injunction directing the defendants to vacate and deliver to
the plaintiff, vacant and peaceful possession of the building within 30 days;
and (c) to issue a permanent injunction restraining the defendants or any of
them, or their agents, representatives, servants or any other persons claiming
through, under or on behalf of any of them from interfering with or in any
manner disturbing, hindering, obstructing, the plaintiff's enjoyment and
possession of the entire suit schedule property including the building portion
ordered to be evicted in terms of prayer (b) hereinabove.
The trial court vide order dated 5.4.2003 allowed application for
amendment filed under Order VI Rule 17 CPC.
respondents aggrieved by the said order of the trial court preferred a writ
petition No.36550 of 2003 under Article 227 of the Constitution before the High
Court of Karnataka on the ground that the amendment as sought and granted has
changed the entire nature of the suit and cause of action. The respondents also
submitted that the fact of allowing amendment would be taking away admissions
in the plaint by the appellant and such an amendment cannot be permitted 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.
The respondents submitted that the original suit was instituted
for recovery of Rs.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 occupants of the building in question.
The learned counsel for the respondents submitted that when the
appellant had originally sought possession of the entire property from the
respondents, by giving up such a claim, now the appellant is trying to
introduce a new case which would certainly affect the rights of the respondents
when the appellant had earlier requested the court to pass a decree for
possession of the entire property. Learned counsel for the appellant also
submitted that the trial court without considering or properly comprehending
implications of all these aspects has allowed the amendment application.
In the impugned judgment, the High Court after considering the
rival contentions came to the definite conclusion that the appellant while
seeking permission to amend the plaint is trying to introduce a new case which
was not his case in the original plaint and proposed amendment if allowed would
certainly affect the rights of the respondents adversely. In the impugned
judgment, the High Court also held that the appellant cannot be permitted to
withdraw the admissions made in the plaint as it would affect the rights of the
The High Court in the impugned judgment also held that any such
amendment which changes the entire character of the plaint cannot 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.
Being aggrieved by the impugned judgment, the appellant has
preferred this appeal.
We have heard the learned counsel for the parties and have also
perused the written submissions filed by the parties.
It is submitted by the learned counsel for the appellant that the
suit, as originally framed, was only for refund of sale consideration and
alternatively for possession. The appellant also submitted that the relief for
possession was always there, although it was in respect of the entire land
which is sought to be amended and reduced to the licensed area only. According
to the appellant, the amendment under Order VI Rule 17 is consequent to the
subsequent Urban Land (Ceiling &
Repeal Act, 1999 which validated all exemption orders notwithstanding any court
orders, judgments or decrees to the contrary. The appellant also submitted that
the amendment 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.
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."
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, seek
any amendment of the plaint relying on the circumstances as to the earlier
decision having been overruled by seeking amendment of the plaint. This has the
effect of changing the character of the suit and also omitting an admission
Respondents (Defendant nos.1, 2, 4 and 7) filed written statement
to the original plaint. They prayed the court to pass a decree in favour of the
appellant for a sum of Rs.27,30,339.45/. This is an admission of the
respondents in favour of the appellant to an extent of Rs.27,30,339.45/-. The
appellant now cannot be permitted to take a complete somersault.
The respondents also submitted that the appellant cannot now seek
recovery of possession of the property. To grant amendment at this stage would
not only have the effect of appellant getting rid of the admissions made in the
original plaint but defeating the provisions of Order XII Rule 6 of the CPC by
changing the cause of action and entire character of the suit and causing
serious prejudice to the respondents. The respondents relied on the decision of
this court in Usha Balashaheb Swami & Others v. Kiran Appaso Swami &
Others1 wherein the court has held that by way of amendment, admission made in
pleadings and particularly in the plaint cannot be sought to be omitted or got
rid of. The Court further observed that a prayer for amendment of the plaint
stand on different footing.
relevant observations of the Court are set out as under:
..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 action or the nature of claim applies to amendments to
plaint. It has no counterpart in the principles relating to 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 written statement
would not be objectionable while adding, altering or substituting a new cause
of action in the plaint may be objectionable.
being the settled law, we must hold that in the case of amendment of a written
1 (2007) 5 SCC 602 statement, the courts are more liberal in allowing an
amendment than that of a plaint as a question of prejudice would be far less in
the former than in the latter case......."
The learned counsel for the respondents further relied on the
decision in Heeralal v. Kalyan Mal & Others2 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.
The respondents have also relied on the decision in Gautam Sarup
v. Leela Jetley & Others3. In the said case, it was held that by amendment
the admission in the original pleadings cannot be sought to be got rid off.
In M/s Modi Spinning & Weaving Mills Co. Ltd. & Another v.
Ladha Ram & Co.4, 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
1 SCC 278 3 (2008) 7 SCC 85 4 (1976) 4 SCC 320
In the said case, a three-Judge bench of this court observed:
It is true that inconsistent pleas can be made in pleadings but the effect of
substitution of paragraphs 25 and 26 is not making inconsistent and alternative
pleadings but it is seeking to displace the plaintiff completely from the
admissions made by the defendants in the written statement. If such amendments
are allowed the plaintiff will be irretrievably prejudiced by being denied the
opportunity of extracting the admission from the defendants. The High Court
rightly rejected the application for amendment and agreed with the trial
judgment has been referred in Usha Balashaheb Swami (supra) and the court
observed that Modi Spinning's case (supra) was a clear authority for the
proposition that once a written statement contained an admission in favour of
the plaintiff, by amendment such an admission of the defendant, cannot be
withdrawn and if allowed, it would amount to totally displacing the case of the
In the same judgment of Usha Balashaheb Swami (supra), the Court
dealt with a number of judgments of this Court and laid down that the 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 the cause of action
or the nature of claim applies to amendments to plaint. It has no counterpart
in the principles relating to 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 written statement would not be objectionable
while adding, altering or substituting a new cause of action in the plaint may
If we carefully examine all the cases, the statement of law
declared by the Privy Council in Ma Shwe Mya v. Maung Mo Hnaung5 has been
consistently accepted by the courts till date as correct statement of law. The
Privy Council observed:
rules of court are nothing but provisions intended to secure the proper
administration of justice, and it is therefore essential that they should be
made to serve and be subordinate to that purpose, so that full powers of
amendment must be enjoyed and should always be liberally exercised, but
nonetheless no power has yet been given to enable one distinct cause of action
to be substituted for another, nor to change, by means of amendment, the
subject-matter of the suit."
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.
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 5 AIR 1922 PC 249 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
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:
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 such amendments shall be made as may be necessary for the purpose
of determining the real questions in controversy between the parties:
that no application for amendment shall 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 before the commencement
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 this information while dealing with the object of
In a recently published unique, unusual and extremely informative
book "Justice, Courts and Delays", the author Arun Mohan, a Senior
Advocate of the High Court of Delhi and of this Court, from his vast experience
as a Civil Lawyer observed that 80% applications under Rule VI Order 17 are
filed with the sole objective of delaying the proceedings, whereas 15%
application are filed because of lackadaisical approach in the first instance,
and 5% applications are those where there is actual need of amendment. His
experience further revealed that out of these 100 applications, 95 applications
are allowed and only 5 (even may be less) are rejected. According to him, a
need for amendment of pleading should arise in a few cases, and if proper rules
with regard to pleadings are put into place, it would be only in rare cases.
Therefore, for allowing amendment, it is not just costs, but the delays caused
thereby, benefit of such delays, the additional costs which 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.
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.
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 determining the real question in controversy
between the parties. The basic principles of grant or refusal of amendment
articulated almost 125 years ago are still considered to be correct statement
of law and our courts have been following the basic principles laid down in
In the leading English case of Cropper v. Smith6, the object
underlying amendment of pleadings has been laid down by Browen, L.J. in the
is a well established principle that the object of the courts is to decide the
rights of the parties and not punish them for mistakes they make in the conduct
in their cases by deciding otherwise than in accordance with their rights ... I
know of no kind of error or mistake which, if not fraudulent or intended to
overreach, the court ought not to correct if it can be done without injustice
to the other party. Courts do not exist for the sake of discipline but for the
sake of deciding matters in controversy, and I do not regard such amendment as
a matter of favour or grace ... it seems to me that as soon as it appears that
the way in which a party has framed his case will not lead to a decision of the
real matter in controversy, it is as much a matter of right on his part to have
it corrected if it can be done without injustice, as anything else in the case
is a matter of right."
In Tildersley v. Harper7 which was decided by the English Court
even earlier than the Cropper's case (supra), in an action against a lessee for
setting aside a lease, in the statement of claim it was alleged that the power
of attorney of donee had received specified sum as a bribe.
statement of defence, each circumstance was denied but there was no general
denial of a bribe having been 6 (1884) 29 Ch D 700 7 (1878) 10 Ch. D 393 given.
A prayer for amendment of the defence statement was refused.
The Court of Appeal held that the amendment ought to have been
allowed. Bramwell, L.J. made the following pertinent observations:
have had much to do in Chambers with applications for leave to amend, and I may
perhaps be allowed to say that this humble branch of learning is very familiar
to me. My practice has always been to give leave to amend unless I have been
satisfied that the party applying was acting mala fide, or that, by his blunder
he had done some injury to his opponent which could not be compensated for by
costs or otherwise."
In another leading English case Weldon v. Neal8, 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.
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.
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 8 (1880) 19 QBD 394: 56 LJ QB 621 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.9
In Steward v. North Metropolitan Tramways Co.10, the plaintiff
filed a suit for damages against the tramways Company for negligence of the
company in allowing the tramways to be in a defective condition. The company
denied the allegation of negligence. It was not even contended that the company
was not the proper party to be sued. More than six months after the written
statement was filed, the company applied for leave to amend the defence by
adding the plea that under the contract entered into between the company and
the local authority the liability to maintain tramways in proper condition was
of the latter and, therefore, the company was not liable. On the date of the
amendment application, the plaintiff's remedy against the local authority was
time barred. Had the agreement been pleaded earlier, the plaintiff could have
filed a suit even against the local authority. Under the circumstances, the amendment
In the said case, Pollock, J. quoting with approval the
observation of Bremwell, LJ. rightly observed: "The test as to whether the
amendment should be allowed is, 9 Ganga Bai v. Vijai Kumar (1974) 2 SCC 393;
Arundhati Mishra v. Sri Ram Charitra Pandey (1994) 2 SCC 29.
16 QB 178 whether or not the defendants can amend without placing the plaintiff
in such a position that he cannot be recouped, as it were, by any allowance of
costs, or otherwise.
to him such an amendment ought not be allowed."
Kisandas v. Rachappa Vithoba11 is probably the first leading case
decided by the High Court of Bombay under the present Code of 1908. There, A,
plaintiff, averred that in pursuance of a partnership agreement, he delivered
Rs.4001 worth of cloth to B, defendant, and sued for dissolution of partnership
and accounts. The trial court found that A delivered the cloth worth Rs.4001
but held that there was no partnership and the suit was not maintainable. In
appeal, A sought amendment of adding a prayer for the recovery of Rs.4001. On
that day, claim for recovery of money was barred by limitation. The amendment
was allowed by the appellate court and the suit was decreed. B challenged the
decree. The High Court upheld the order and dismissed the appeal. Referring to
leading English decisions on the point, Batchelor, J. stated:
the imperative character of the last sentence of the rule it seems to me clear
that, at any stage of the proceedings, all amendments ought to be allowed which
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."
In a concurring judgment, Beaman, J. observed that "the
practice is to allow all amendments, whether 11 (1909) 33 Bom 644 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."
Lordship proceeded to state:
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."
In Amulakchand Mewaram & Others v. Babulal Kanalal Taliwala12,
the Bombay High Court again had an occasion to decide a case under Order VI
Rule 17. In that case, the Court approved the following observations of
the question whether there should be an amendment or not really turns upon
whether the name in which the suit is brought in the name of a non-existent
person or whether it is merely a misdescription of existing persons. If the
former is the case, the suit is a nullity and no amendment can cure it. If the
latter is the case, prima facie, there ought to be an amendment because the
general rule, subject no doubt to certain exceptions, is that the Court should
always allow an amendment where any loss to the opposing party can be
compensated for by costs."
35 Bom. L.R. 569
In L.J. Leach & Co. Ltd. & Another v. Jardine, Skinner
& Co.13, a suit for damages for `conversion of goods' filed by the
plaintiff was decreed by the trial court but the decree was set aside by the
High Court. In an appeal before this Court, the plaintiff applied for amendment
of the plaint by raising an alternative claim for damages for breach of
contract for `non-delivery of goods'.
amendment was resisted by the defendant contending that it sought to introduce
a new cause of action which was barred by limitation on the day the amendment
was sought and, hence, it would seriously prejudice the defendant.
Though the Court noticed `considerable force' in the objection,
keeping in view the prayer in the amendment which was not `foreign to the scope
of the suit' and all necessary facts were on record, it allowed the amendment.
In P.H. Patil v. K.S. Patil14, A obtained a decree for possession
against B. He was, however, obstructed in obtaining possession by C in
execution. A then filed a substantive suit against B and C. In the plaint,
except saying that he had obtained a decree against B, nothing more was stated
by A. Hence, he filed an application for amendment which was rejected by the
trial court but allowed by the High Court. C approached this Court.
Dismissing the appeal and confirming the order of 13 AIR 1957 SC
357 14 AIR 1957 SC 363 the High Court, this Court observed that the
discretionary power of amendment was not exercised by the High Court on wrong
principles. There was merely a defect in the pleading which was removed by the
amendment. The quality and quantity of the reliefs sought remained the same.
amendment did not introduce a new case, the defendant was not taken by
In Pursuhottam Umedbhai & Co. v. Manilal & Sons15 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.
In similar circumstances, in a subsequent case Ganesh Trading Co.
v. Moji Ram16, this Court reiterated the law laid down in Purushottam Umedbhai
& Co. (supra). The Court observed:
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 failure to set out even an essential fact does not,
by itself, constitute a new cause of action.
of action is constituted by the whole bundle of essential facts which the
plaintiff 15 AIR 1961 SC 325 16 (1978) 2 SCC 91 must prove before he can
succeed in his suit. It must be antecedent to the institution of the suit. If
any essential fact is lacking from averments in the plaint the cause of action
will be defective. In that case, an attempt to supply the omission has been and
could sometime be viewed as equivalent to an introduction of a new cause of
action which, cured of its shortcomings, has really become a good cause of
action. This, however, is not the only possible interpretation; to be put on
every defective state of pleadings.
pleadings are generally curable, if the cause of action sought to be brought
out was not ab initio completely absent. Even very defective pleadings may be
permitted to be cured, so as to constitute cause of action where there was
none, provided necessary conditions, such as payment of either any additional
court fees, which may be payable, or, of costs of the other side are complied
with. It is only if lapse of time has barred the remedy on a newly constituted
cause of action that the Courts should, ordinarily, refuse prayers for
amendment of pleadings."
In Laxmidas Dayabhai Kabrawala v. Nanabhai Chunilal Kabrawala
& Others17, the defendant's prayer for amendment by treating a counter
claim as cross-suit was objected to by the plaintiff inter alia on the ground
amendment, however, was allowed.
When the matter reached this Court, while affirming the order of
the High Court, the majority stated:
is, no doubt, true that, save in exceptional cases, leave to amend under O. 6,
17 of the
Code will ordinarily be refused when the effect of the amendment would be to
take away from a party a legal right which had accrued to him by lapse of time.
But this rule can apply only when either fresh allegations are added or fresh
reliefs sought by way of amendment. Where, for instance, an amendment is sought
which merely clarifies an existing pleading and does not in substance add to or
alter it, it has never been held that the question of a bar of limitation is 17
AIR 1964 SC 11 one of the questions to be considered in allowing such
clarification of a matter already contained in the original pleading."
The Court further 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.
In Jai Jai Ram Manohar Lal v. National Building Material Supply18,
A sued B in his individual name but afterward soughts 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'.
Reversing the order of the High Court, this Court (per Shah, J.,
as he then was) made the following of quoted observations:
1 SCC 869 "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 rules of
procedure. The Court always gives leave to amend the pleading of a party,
unless it is satisfied that the party Applying, was acting mala fide, or that
by his blunder, he had caused injury to his opponent which may not be
compensated for by an order of costs. However negligent or careless may have
been the first omission, and, however late the proposed amendment, the
amendment may be allowed if it can be made without injustice to the other
side." (Emphasis Added)
In Ganga Bai v. Vijay Kumar19, an appeal was filed against a mere
finding recorded by the trial court. After a lapse of more than seven years,
amendment was sought by which a preliminary decree was challenged which was
granted by the High Court by a laconic order.
Setting aside the order of the High Court, this Court stated:
preliminary decree had remained unchallenged since September 1958 and by lapse
of time a valuable right had accrued in favour of the decree-holder. The power
to allow an amendment is undoubtedly wide and may at any stage be appropriately
exercised in the interest of justice, the law of limitation notwithstanding.
exercise of such far-reaching discretionary powers is governed by judicial
considerations and wider the discretion, greater ought to be the care and
circumspection on the part of the court."
In Haridas Aildas Thadani & Others v. Godraj Rustom Kermani20
this Court said that "It is well settled that the 19 (1974) 2 SCC 393 20
(1984) 1 SCC 668 court should be extremely liberal in granting prayer for
amendment of pleading unless serious injustice or irreparable loss is caused to
the other side. It is also clear that a revisional court ought not to lightly interfere
with a discretion exercised in allowing amendment in absence of cogent reasons
or compelling circumstances.
In B. K. Narayana Pillai v. Parameshwaram Pillai & Another21,
a suit was filed by A for recovery of possession from B alleging that B was a
licensee. In the written statement B contended that he was a lessee. After the
trial began, he applied for amendment of the written statement by adding an
alternative plea that in case B is held to be a licensee, the licence was
irrevocable. The amendment was refused.
Setting aside the orders refusing amendment, this Court stated:
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 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 hyper technical
approach. Liberal approach should be the general rule particularly in cases
where the other side can be compensated with the costs.
of law should not be permitted to hamper the courts in, the administration of
justice between the parties. Amendments are 21 (2000) 1 SCC 712 allowed in the
pleadings to avoid uncalled for multiplicity of litigation."
In Suraj Prakash Bhasin v. Raj Rani Bhasin & Others22, 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 injustice and prejudice
of an irremediable character are not inflicted on the opposite party under
pretence of amendment, that one distinct cause of action should not be
substituted for anther and that the subject matter of the suit should not be
changed by amendment.
AMENDMENT IS NECESSARY TO DECIDE REAL CONTROVERSY:
The first condition which must be satisfied before the amendment
can be allowed by the court is whether such amendment is necessary for the
determination of the real question in controversy. If that condition is not
satisfied, the amendment cannot be allowed. This is the basic test which should
govern the courts' discretion in grant or refusal of the amendment.
PREJUDICE OR INJUSTICE TO OTHER PARTY:
The other important condition which should govern the discretion
of the Court is the potentiality of prejudice or injustice which is likely to
be caused to 22 (1981) 3 SCC 652 other side. Ordinarily, if other side is
compensated by costs, then there is no injustice but in practice hardly any
court grants actual costs to the opposite side.
The Courts have very wide discretion in the matter of amendment of
pleadings but court's powers must be exercised judiciously and with great care.
In Ganga Bai's case (supra), this Court has rightly observed:
power to allow an amendment is undoubtedly wide and may at any stage be
appropriately exercised in the interest of justice, the law of limitation
notwithstanding. But the exercise of such far-reaching discretionary powers is
governed by judicial considerations and wider the discretion, greater ought to
be the care and circumspection on the part of the court."
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. These factors are illustrative in nature
and not exhaustive.
what stage the amendment was sought? (ii) While imposing the costs, it should
be taken into consideration whether the amendment has been sought at a
pre-trial or post-trial stage;
financial benefit derived by one party at the cost of other party should be
properly calculated in terms of money and the costs be awarded accordingly.
imposition of costs should not be symbolic but realistic;
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.
case of appeal to higher courts, the victim of amendment is compelled to bear
considerable additional costs.
aspects must be carefully taken into consideration while awarding the costs.
The purpose of imposing costs is to:
Discourage malafide amendments designed to delay the legal proceedings;
Compensate the other party for the delay and the inconvenience caused;
Compensate the other party for avoidable 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
TO BE TAKEN INTO CONSIDERATION WHILE DEALING WITH
On critically analyzing both the English and Indian cases, some
basic principles emerge which ought to be taken into consideration while
allowing or rejecting the application for amendment.
the amendment sought is imperative for proper and effective adjudication of the
case? (2) Whether the application for amendment is bona fide or mala fide? (3)
The amendment should not cause such prejudice to the other side which cannot be
compensated adequately in terms of money;
Refusing amendment would in fact lead to injustice or lead to multiple
the proposed amendment constitutionally or fundamentally changes the nature and
character of the case? and (6) As a general rule, the court should decline
amendments if a fresh suit on the amended claims would be barred by limitation
on the date of application.
These are some of the important factors which may be kept in mind
while dealing with application filed under Order VI Rule 17. These are only
illustrative and not exhaustive.
The decision on an application made under Order VI Rule 17 is a
very serious judicial exercise and the said exercise should never be undertaken
in a casual manner.
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 Rs.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.
........................................J. (Dalveer Bhandari)
.......................................J. (Harjit Singh Bedi)
October 9, 2009.