Suit for Declaration , Mandatory Injunction and for accounts and permanent injunction against companies , firms and immovable properties of Hindu Joint family - Trial court granted interim injunction order for not to sale and directed to submit audit reports regularly before the court - High court dismissed the injunction order as the suit is not maintainable against company properties and firms( even though corporate veil was lifted in partition suits as per Apex court) and as the suit is bad for non-joinder of necessary parties and dismissed the I.A. stating that when the main relief can not be granted, no interim injunction should be given - Apex court held that we are of the opinion that while dealing with a matter relating to vacation of order of temporary injunction, it was not open for the High Court to give a finding on the main issue relating to maintainability of the suit and the family settlement reached between the parties. =
Plaintiffs/appellants-Babulal and others filed a suit for
declaration, mandatory injunction, rendition of accounts and permanent
injunction against the defendants/non-applicants =
Interim Injunction
Resultantly, the application of the plaintiffs-
appellants for temporary injunction against the non-applicants and the
counter temporary injunction application filed on behalf of the non-
applicants were partly allowed and it was ordered that till the decision of
the original suit:-
1. The applicants and non-applicants no.1 to 31 and the non-applicants
no.36 to 43 shall not sell/transfer the immovable properties as mentioned
in Schedule “Ka” to “Cha” and nor shall they create any substantial charge
on the said properties.
2. The Companies/Partnership firms controlled and run by the parties of
which the details have been given in Schedule “Ka” to “Cha” regarding them
the audited accounts of income and expenditure half yearly/annually
whichever is got done in the normal sequence shall be presented before this
Court.
Apart from this the other prayers which have been made by both the
parties are rejected. =
Reliance Natural Resources Ltd. v. Reliance Industries Ltd. (2010) 7 SCC 1
and in the case of Sangram Singh P. Gaekwad and others v. Shantadevi P.
Gaekwad (D) Through LRs. & Ors. (2005) 11 SCC 314 and submitted that though
a company incorporated under the Companies Act is a body corporate, in
certain situations, its corporate veil can be lifted and that the suit for
partition could be filed against companies also.
C.M.A.
The High Court by impugned judgment and order dated 14th March, 2012
observed as follows:
”6………It is also significant to note that the plaintiffs have impleaded the
companies, partnership firms and proprietary concerns and HUFs as the party
defendants, and the said companies and firms have also been shown as the
properties or the assets of the HUF in the schedule 'Gha' annexed to the
plaint.
This court fails to understand as to how the companies which are
incorporated under the Companies Act having perpetual seal and separate
entity could be the assets of the HUF as alleged by the plaintiffs and as
to how the companies could be divided by metes and bounds by way of
partition as prayed for in the suit.
The plaintiffs in the suit have also
prayed for mandatory injunction seeking direction against the defendant-
companies alongwith other defendants to act upon the family settlement,
alleged to have taken place on 20.12.2007 between the Niranjan Lal Data
Group and Babu Lal Data Group, and have also sought the direction against
the said companies to execute the documents and handover the possession of
the properties of the said companies and firms etc.
This court also fails
to understand as to how the alleged family settlement between the NLD Group
and BLD Group would be binding to the defendant companies and firms, apart
from the issue as to whether the alleged document dated 20.12.2007 could be
called a family settlement.
Under the circumstances this court finds much
substance in the submission made by the learned counsel for the appellants
that the suit filed by the plaintiffs is not only bad for mis-joinder of
parties and of causes of action, but also for non-joinder of necessary
parties and that the suit in the present form would not be maintainable in
the eye of law.
7. So far as merits of the case are concerned, according to the
respondents-plaintiffs, all the properties mentioned in the Schedules 'Ka'
to 'Chha' annexed to the plaint, were purchased from the nucleus of the
joint family properties, and as per the family settlement dated 20.12.07,
the said properties were required to be divided amongst the family members
of the plaintiff No. 1 and the defendant Nos.1 to 9.
In this regard, it is
pertinent to note that the entire suit of the plaintiffs is based on the so-
called family settlement which had allegedly taken place between the NLD
group and BLD group on 20.12.07.
From the bare perusal of the said document
it transpires that it is the minutes of the meeting of Data Group Family
dated 20.12.07, which was signed by Mr. Vijay Data for NLD Group and Mr.
Babu Lal Data for BLD Group. Apart from the fact that there is not a
whisper in the said document that the corpus of the companies mentioned in
the said document was provided by the HUF or that the other properties
mentioned in the said document were the HUF properties, the said document
has also not been signed by the other coparceners of the alleged HUF except
by Mr. Vijay Data and Mr. Babu Lal Data.
Such a document by no stretch of
imagination could be said to be a family settlement. However, even if it is
believed to be a family settlement, and even if it is held that the same
was not required to be signed by all the coparceners, then also there is
nothing on the record to suggest that it was a memorandum prepared after
the family arrangement which had already been made earlier, not required to
be registered. ………….
“9. In this regard it is pertinent to note that though the concerned
defendants had raised contentious issues as regards the maintainability of
the suit, mis-joinder of parties and of causes of action, suppression of
material facts by the plaintiffs etc., the lower court has not considered
the same and has held that the plaintiffs had established the prima facie
case in their favour.
In the opinion of this court such a finding of the
lower court in the impugned order is not only erroneous but also perverse.
When the suit on the face of it suffered from the mis-joinder of parties
and of causes of action and was not prima facie tenable in the eye of law,
the lower court has committed serious error of law and facts in holding
that the plaintiffs had established a prima facie case.
If the plaintiffs
were not entitled to the final reliefs in the suit, they could not be
granted temporary injunction as prayed for during the pendency of the
suit.”
Apex court held that
we are of the opinion that while
dealing with a matter relating to vacation of order of temporary
injunction, it was not open for the High Court to give a finding on the
main issue relating to maintainability of the suit and the family
settlement reached between the parties.
8. In view of the finding aforesaid, we are inclined to interfere with
the judgment and order dated 14th March, 2012 passed by the High Court of
Judicature for Rajasthan, Bench at Jaipur in S.B. Civil Misc. Appeal
No.2218 of 2011 etc. We, accordingly, set aside the impugned judgment and
remit back the matter to the High Court for its fresh disposal after
hearing the parties.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 7174 OF 2014
(Arising out of SLP(C) No.9914 of 2012)
BABU LAL & ORS. … APPELLANTS
VERSUS
M/S VIJAY SOLVEX LTD. & ORS. … RESPONDENTS
WITH
C.A. NO.7175 OF 2014 (@ SLP(C)No.10363/2012)
C.A. NOs.7195-7201 OF 2014 (@ SLP(C)Nos.18158-18164/2012)
C.A. NO.7177 OF 2014 (@ SLP(C)No.18420/2012)
J U D G M E N T
SUDHANSU JYOTI MUKHOPADHAYA, J.
Leave granted.
2. In these appeals the appellants have challenged the common judgment
and order dated 14th March, 2012 passed by the High Court of Judicature for
Rajasthan, Bench at Jaipur in S.B. Civil Misc. Appeal No. 2218 of 2011 etc.
By the impugned judgment, the High Court modified the interim order dated
10th February, 2011 passed by the Additional District Judge No.3 Jaipur
Metropolitan Magistrate, Jaipur (hereinafter referred to as, “the Lower
Court”) in Civil Misc. Case No.36/2010, whereby the Lower Court
partly allowed the application of the appellants-original plaintiffs
seeking temporary injunction under Order XXXIX Rule 1,2 of CPC. The High
Court set aside the temporary injunction granted in favour of
plaintiffs/appellants by the Lower Court and confirmed that part of the
order requiring production of audited/unaudited accounts of the
companies/partnership firms run by the parties.
3. The present appeals arise from the following sequence of facts.
Plaintiffs/appellants-Babulal and others filed a suit for
declaration, mandatory injunction, rendition of accounts and permanent
injunction against the defendants/non-applicants. The Lower Court noticed
that the properties which the plaintiffs presented in the Schedules “Ka” to
“Cha” are basically immovable properties, companies and partnership firms
regarding which both the parties have claimed ownership. Taking into
consideration that the dispute between the parties has arisen after the
year 2007 and the cases are pending before the Company Law Board and if a
restraint is not imposed upon the transfer of the aforesaid properties it
will lead to multiplicity of litigation and the parties will entangle in
litigation, the Lower Court observed that plaintiffs/appellants have made
out partially a prima facie case and held that the issue of balance of
convenience and irreparable loss are in favour of the
plaintiffs/appellants. Resultantly, the application of the plaintiffs-
appellants for temporary injunction against the non-applicants and the
counter temporary injunction application filed on behalf of the non-
applicants were partly allowed and it was ordered that till the decision of
the original suit:-
1. The applicants and non-applicants no.1 to 31 and the non-applicants
no.36 to 43 shall not sell/transfer the immovable properties as mentioned
in Schedule “Ka” to “Cha” and nor shall they create any substantial charge
on the said properties.
2. The Companies/Partnership firms controlled and run by the parties of
which the details have been given in Schedule “Ka” to “Cha” regarding them
the audited accounts of income and expenditure half yearly/annually
whichever is got done in the normal sequence shall be presented before this
Court. Apart from this the other prayers which have been made by both the
parties are rejected.
4. The non-applicants preferred different miscellaneous appeals against
the aforesaid interim order of injunction before the High Court. The non-
applicants-respondents herein made the following submissions:
(a) The suit of the plaintiffs in the present form is not maintainable in
the eyes of law, inasmuch as it has been filed by Sh. Babulal along with
Saurabh Agrotech Pvt. Ltd., which is a company incorporated under the
Companies Act, two partnership firms registered under the Partnership Act
jointly and the HUF of Babulal, seeking partition of the properties
mentioned in the Schedules annexed to the plaint and that too against the
set of companies, which have been shown as the assets of the HUF.
(b) Plaintiff-Babulal though seeking partition of the joint family
properties has not impleaded his own sons and other coparceners as parties
to the suit and has not included the properties owned and managed by the
plaintiffs in the schedules annexed to the plaint. Therefore, it was argued
that the suit itself is bad for non-joinder of necessary parties and of
causes of action and the suit is not tenable in the eye of law.
(c) The Lower Court failed to consider the contentions raised by the
concerned defendants and also the documents produced by them.
5. On the other hand, learned counsel for the plaintiffs-appellants made
the following submissions:
(a) The Lower Court has passed the impugned order which is just and
proper after considering the prima facie case, irreparable injuries likely
to be caused to the plaintiffs and the balance of convenience.
(b) On 20th December, 2007, a family settlement has taken place between
Niranjan Lal Data Group which belong to the defendants and Babu Lal Data
Group which belong to the plaintiffs and that the said settlement was
signed by Mr. Vijay Data for Niranjan Lal Data Group and by Babu Lal Data
for Babu Lal Data Group. The said settlement was also partly acted upon by
the defendant-Niranjan Lal and other coparceners and therefore, they cannot
be permitted to back out from the said settlement.
Learned counsel also placed reliance upon decisions of this Court in
Reliance Natural Resources Ltd. v. Reliance Industries Ltd. (2010) 7 SCC 1
and in the case of Sangram Singh P. Gaekwad and others v. Shantadevi P.
Gaekwad (D) Through LRs. & Ors. (2005) 11 SCC 314 and submitted that though
a company incorporated under the Companies Act is a body corporate, in
certain situations, its corporate veil can be lifted and that the suit for
partition could be filed against companies also.
It was further contended on behalf of the plaintiffs-appellants that
the family settlement need not be signed by coparceners and that if a mere
memorandum of family arrangement was prepared with regard to the
arrangement which had already taken place; such a document did not require
registration. The family settlement made by the parties bona fide by making
fair and equitable division of the properties amongst various members of
the family must be respected.
6. The High Court by impugned judgment and order dated 14th March, 2012
observed as follows:
”6………It is also significant to note that the plaintiffs have impleaded the
companies, partnership firms and proprietary concerns and HUFs as the party
defendants, and the said companies and firms have also been shown as the
properties or the assets of the HUF in the schedule 'Gha' annexed to the
plaint. This court fails to understand as to how the companies which are
incorporated under the Companies Act having perpetual seal and separate
entity could be the assets of the HUF as alleged by the plaintiffs and as
to how the companies could be divided by metes and bounds by way of
partition as prayed for in the suit. The plaintiffs in the suit have also
prayed for mandatory injunction seeking direction against the defendant-
companies alongwith other defendants to act upon the family settlement,
alleged to have taken place on 20.12.2007 between the Niranjan Lal Data
Group and Babu Lal Data Group, and have also sought the direction against
the said companies to execute the documents and handover the possession of
the properties of the said companies and firms etc. This court also fails
to understand as to how the alleged family settlement between the NLD Group
and BLD Group would be binding to the defendant companies and firms, apart
from the issue as to whether the alleged document dated 20.12.2007 could be
called a family settlement. Under the circumstances this court finds much
substance in the submission made by the learned counsel for the appellants
that the suit filed by the plaintiffs is not only bad for mis-joinder of
parties and of causes of action, but also for non-joinder of necessary
parties and that the suit in the present form would not be maintainable in
the eye of law.
7. So far as merits of the case are concerned, according to the
respondents-plaintiffs, all the properties mentioned in the Schedules 'Ka'
to 'Chha' annexed to the plaint, were purchased from the nucleus of the
joint family properties, and as per the family settlement dated 20.12.07,
the said properties were required to be divided amongst the family members
of the plaintiff No. 1 and the defendant Nos.1 to 9. In this regard, it is
pertinent to note that the entire suit of the plaintiffs is based on the so-
called family settlement which had allegedly taken place between the NLD
group and BLD group on 20.12.07. From the bare perusal of the said document
it transpires that it is the minutes of the meeting of Data Group Family
dated 20.12.07, which was signed by Mr. Vijay Data for NLD Group and Mr.
Babu Lal Data for BLD Group. Apart from the fact that there is not a
whisper in the said document that the corpus of the companies mentioned in
the said document was provided by the HUF or that the other properties
mentioned in the said document were the HUF properties, the said document
has also not been signed by the other coparceners of the alleged HUF except
by Mr. Vijay Data and Mr. Babu Lal Data. Such a document by no stretch of
imagination could be said to be a family settlement. However, even if it is
believed to be a family settlement, and even if it is held that the same
was not required to be signed by all the coparceners, then also there is
nothing on the record to suggest that it was a memorandum prepared after
the family arrangement which had already been made earlier, not required to
be registered. ………….
“9. In this regard it is pertinent to note that though the concerned
defendants had raised contentious issues as regards the maintainability of
the suit, mis-joinder of parties and of causes of action, suppression of
material facts by the plaintiffs etc., the lower court has not considered
the same and has held that the plaintiffs had established the prima facie
case in their favour. In the opinion of this court such a finding of the
lower court in the impugned order is not only erroneous but also perverse.
When the suit on the face of it suffered from the mis-joinder of parties
and of causes of action and was not prima facie tenable in the eye of law,
the lower court has committed serious error of law and facts in holding
that the plaintiffs had established a prima facie case. If the plaintiffs
were not entitled to the final reliefs in the suit, they could not be
granted temporary injunction as prayed for during the pendency of the
suit.”
7. We have heard learned counsel for the parties and have perused the
record. In the present case, the parties have raised similar pleas which
were taken before the High Court. However, we are of the opinion that while
dealing with a matter relating to vacation of order of temporary
injunction, it was not open for the High Court to give a finding on the
main issue relating to maintainability of the suit and the family
settlement reached between the parties.
8. In view of the finding aforesaid, we are inclined to interfere with
the judgment and order dated 14th March, 2012 passed by the High Court of
Judicature for Rajasthan, Bench at Jaipur in S.B. Civil Misc. Appeal
No.2218 of 2011 etc. We, accordingly, set aside the impugned judgment and
remit back the matter to the High Court for its fresh disposal after
hearing the parties.
9. The appeals stand disposed of with aforesaid observations.
……………………………………………………………………………J.
(SUDHANSU JYOTI MUKHOPADHAYA)
…………………………………………………………………………J.
(S.A.BOBDE)
NEW DELHI,
August 4, 2014.
Plaintiffs/appellants-Babulal and others filed a suit for
declaration, mandatory injunction, rendition of accounts and permanent
injunction against the defendants/non-applicants =
Interim Injunction
Resultantly, the application of the plaintiffs-
appellants for temporary injunction against the non-applicants and the
counter temporary injunction application filed on behalf of the non-
applicants were partly allowed and it was ordered that till the decision of
the original suit:-
1. The applicants and non-applicants no.1 to 31 and the non-applicants
no.36 to 43 shall not sell/transfer the immovable properties as mentioned
in Schedule “Ka” to “Cha” and nor shall they create any substantial charge
on the said properties.
2. The Companies/Partnership firms controlled and run by the parties of
which the details have been given in Schedule “Ka” to “Cha” regarding them
the audited accounts of income and expenditure half yearly/annually
whichever is got done in the normal sequence shall be presented before this
Court.
Apart from this the other prayers which have been made by both the
parties are rejected. =
Reliance Natural Resources Ltd. v. Reliance Industries Ltd. (2010) 7 SCC 1
and in the case of Sangram Singh P. Gaekwad and others v. Shantadevi P.
Gaekwad (D) Through LRs. & Ors. (2005) 11 SCC 314 and submitted that though
a company incorporated under the Companies Act is a body corporate, in
certain situations, its corporate veil can be lifted and that the suit for
partition could be filed against companies also.
C.M.A.
The High Court by impugned judgment and order dated 14th March, 2012
observed as follows:
”6………It is also significant to note that the plaintiffs have impleaded the
companies, partnership firms and proprietary concerns and HUFs as the party
defendants, and the said companies and firms have also been shown as the
properties or the assets of the HUF in the schedule 'Gha' annexed to the
plaint.
This court fails to understand as to how the companies which are
incorporated under the Companies Act having perpetual seal and separate
entity could be the assets of the HUF as alleged by the plaintiffs and as
to how the companies could be divided by metes and bounds by way of
partition as prayed for in the suit.
The plaintiffs in the suit have also
prayed for mandatory injunction seeking direction against the defendant-
companies alongwith other defendants to act upon the family settlement,
alleged to have taken place on 20.12.2007 between the Niranjan Lal Data
Group and Babu Lal Data Group, and have also sought the direction against
the said companies to execute the documents and handover the possession of
the properties of the said companies and firms etc.
This court also fails
to understand as to how the alleged family settlement between the NLD Group
and BLD Group would be binding to the defendant companies and firms, apart
from the issue as to whether the alleged document dated 20.12.2007 could be
called a family settlement.
Under the circumstances this court finds much
substance in the submission made by the learned counsel for the appellants
that the suit filed by the plaintiffs is not only bad for mis-joinder of
parties and of causes of action, but also for non-joinder of necessary
parties and that the suit in the present form would not be maintainable in
the eye of law.
7. So far as merits of the case are concerned, according to the
respondents-plaintiffs, all the properties mentioned in the Schedules 'Ka'
to 'Chha' annexed to the plaint, were purchased from the nucleus of the
joint family properties, and as per the family settlement dated 20.12.07,
the said properties were required to be divided amongst the family members
of the plaintiff No. 1 and the defendant Nos.1 to 9.
In this regard, it is
pertinent to note that the entire suit of the plaintiffs is based on the so-
called family settlement which had allegedly taken place between the NLD
group and BLD group on 20.12.07.
From the bare perusal of the said document
it transpires that it is the minutes of the meeting of Data Group Family
dated 20.12.07, which was signed by Mr. Vijay Data for NLD Group and Mr.
Babu Lal Data for BLD Group. Apart from the fact that there is not a
whisper in the said document that the corpus of the companies mentioned in
the said document was provided by the HUF or that the other properties
mentioned in the said document were the HUF properties, the said document
has also not been signed by the other coparceners of the alleged HUF except
by Mr. Vijay Data and Mr. Babu Lal Data.
Such a document by no stretch of
imagination could be said to be a family settlement. However, even if it is
believed to be a family settlement, and even if it is held that the same
was not required to be signed by all the coparceners, then also there is
nothing on the record to suggest that it was a memorandum prepared after
the family arrangement which had already been made earlier, not required to
be registered. ………….
“9. In this regard it is pertinent to note that though the concerned
defendants had raised contentious issues as regards the maintainability of
the suit, mis-joinder of parties and of causes of action, suppression of
material facts by the plaintiffs etc., the lower court has not considered
the same and has held that the plaintiffs had established the prima facie
case in their favour.
In the opinion of this court such a finding of the
lower court in the impugned order is not only erroneous but also perverse.
When the suit on the face of it suffered from the mis-joinder of parties
and of causes of action and was not prima facie tenable in the eye of law,
the lower court has committed serious error of law and facts in holding
that the plaintiffs had established a prima facie case.
If the plaintiffs
were not entitled to the final reliefs in the suit, they could not be
granted temporary injunction as prayed for during the pendency of the
suit.”
Apex court held that
we are of the opinion that while
dealing with a matter relating to vacation of order of temporary
injunction, it was not open for the High Court to give a finding on the
main issue relating to maintainability of the suit and the family
settlement reached between the parties.
8. In view of the finding aforesaid, we are inclined to interfere with
the judgment and order dated 14th March, 2012 passed by the High Court of
Judicature for Rajasthan, Bench at Jaipur in S.B. Civil Misc. Appeal
No.2218 of 2011 etc. We, accordingly, set aside the impugned judgment and
remit back the matter to the High Court for its fresh disposal after
hearing the parties.
2014 -Aug.part – http://judis.nic.in/supremecourt/filename=41811
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 7174 OF 2014
(Arising out of SLP(C) No.9914 of 2012)
BABU LAL & ORS. … APPELLANTS
VERSUS
M/S VIJAY SOLVEX LTD. & ORS. … RESPONDENTS
WITH
C.A. NO.7175 OF 2014 (@ SLP(C)No.10363/2012)
C.A. NOs.7195-7201 OF 2014 (@ SLP(C)Nos.18158-18164/2012)
C.A. NO.7177 OF 2014 (@ SLP(C)No.18420/2012)
J U D G M E N T
SUDHANSU JYOTI MUKHOPADHAYA, J.
Leave granted.
2. In these appeals the appellants have challenged the common judgment
and order dated 14th March, 2012 passed by the High Court of Judicature for
Rajasthan, Bench at Jaipur in S.B. Civil Misc. Appeal No. 2218 of 2011 etc.
By the impugned judgment, the High Court modified the interim order dated
10th February, 2011 passed by the Additional District Judge No.3 Jaipur
Metropolitan Magistrate, Jaipur (hereinafter referred to as, “the Lower
Court”) in Civil Misc. Case No.36/2010, whereby the Lower Court
partly allowed the application of the appellants-original plaintiffs
seeking temporary injunction under Order XXXIX Rule 1,2 of CPC. The High
Court set aside the temporary injunction granted in favour of
plaintiffs/appellants by the Lower Court and confirmed that part of the
order requiring production of audited/unaudited accounts of the
companies/partnership firms run by the parties.
3. The present appeals arise from the following sequence of facts.
Plaintiffs/appellants-Babulal and others filed a suit for
declaration, mandatory injunction, rendition of accounts and permanent
injunction against the defendants/non-applicants. The Lower Court noticed
that the properties which the plaintiffs presented in the Schedules “Ka” to
“Cha” are basically immovable properties, companies and partnership firms
regarding which both the parties have claimed ownership. Taking into
consideration that the dispute between the parties has arisen after the
year 2007 and the cases are pending before the Company Law Board and if a
restraint is not imposed upon the transfer of the aforesaid properties it
will lead to multiplicity of litigation and the parties will entangle in
litigation, the Lower Court observed that plaintiffs/appellants have made
out partially a prima facie case and held that the issue of balance of
convenience and irreparable loss are in favour of the
plaintiffs/appellants. Resultantly, the application of the plaintiffs-
appellants for temporary injunction against the non-applicants and the
counter temporary injunction application filed on behalf of the non-
applicants were partly allowed and it was ordered that till the decision of
the original suit:-
1. The applicants and non-applicants no.1 to 31 and the non-applicants
no.36 to 43 shall not sell/transfer the immovable properties as mentioned
in Schedule “Ka” to “Cha” and nor shall they create any substantial charge
on the said properties.
2. The Companies/Partnership firms controlled and run by the parties of
which the details have been given in Schedule “Ka” to “Cha” regarding them
the audited accounts of income and expenditure half yearly/annually
whichever is got done in the normal sequence shall be presented before this
Court. Apart from this the other prayers which have been made by both the
parties are rejected.
4. The non-applicants preferred different miscellaneous appeals against
the aforesaid interim order of injunction before the High Court. The non-
applicants-respondents herein made the following submissions:
(a) The suit of the plaintiffs in the present form is not maintainable in
the eyes of law, inasmuch as it has been filed by Sh. Babulal along with
Saurabh Agrotech Pvt. Ltd., which is a company incorporated under the
Companies Act, two partnership firms registered under the Partnership Act
jointly and the HUF of Babulal, seeking partition of the properties
mentioned in the Schedules annexed to the plaint and that too against the
set of companies, which have been shown as the assets of the HUF.
(b) Plaintiff-Babulal though seeking partition of the joint family
properties has not impleaded his own sons and other coparceners as parties
to the suit and has not included the properties owned and managed by the
plaintiffs in the schedules annexed to the plaint. Therefore, it was argued
that the suit itself is bad for non-joinder of necessary parties and of
causes of action and the suit is not tenable in the eye of law.
(c) The Lower Court failed to consider the contentions raised by the
concerned defendants and also the documents produced by them.
5. On the other hand, learned counsel for the plaintiffs-appellants made
the following submissions:
(a) The Lower Court has passed the impugned order which is just and
proper after considering the prima facie case, irreparable injuries likely
to be caused to the plaintiffs and the balance of convenience.
(b) On 20th December, 2007, a family settlement has taken place between
Niranjan Lal Data Group which belong to the defendants and Babu Lal Data
Group which belong to the plaintiffs and that the said settlement was
signed by Mr. Vijay Data for Niranjan Lal Data Group and by Babu Lal Data
for Babu Lal Data Group. The said settlement was also partly acted upon by
the defendant-Niranjan Lal and other coparceners and therefore, they cannot
be permitted to back out from the said settlement.
Learned counsel also placed reliance upon decisions of this Court in
Reliance Natural Resources Ltd. v. Reliance Industries Ltd. (2010) 7 SCC 1
and in the case of Sangram Singh P. Gaekwad and others v. Shantadevi P.
Gaekwad (D) Through LRs. & Ors. (2005) 11 SCC 314 and submitted that though
a company incorporated under the Companies Act is a body corporate, in
certain situations, its corporate veil can be lifted and that the suit for
partition could be filed against companies also.
It was further contended on behalf of the plaintiffs-appellants that
the family settlement need not be signed by coparceners and that if a mere
memorandum of family arrangement was prepared with regard to the
arrangement which had already taken place; such a document did not require
registration. The family settlement made by the parties bona fide by making
fair and equitable division of the properties amongst various members of
the family must be respected.
6. The High Court by impugned judgment and order dated 14th March, 2012
observed as follows:
”6………It is also significant to note that the plaintiffs have impleaded the
companies, partnership firms and proprietary concerns and HUFs as the party
defendants, and the said companies and firms have also been shown as the
properties or the assets of the HUF in the schedule 'Gha' annexed to the
plaint. This court fails to understand as to how the companies which are
incorporated under the Companies Act having perpetual seal and separate
entity could be the assets of the HUF as alleged by the plaintiffs and as
to how the companies could be divided by metes and bounds by way of
partition as prayed for in the suit. The plaintiffs in the suit have also
prayed for mandatory injunction seeking direction against the defendant-
companies alongwith other defendants to act upon the family settlement,
alleged to have taken place on 20.12.2007 between the Niranjan Lal Data
Group and Babu Lal Data Group, and have also sought the direction against
the said companies to execute the documents and handover the possession of
the properties of the said companies and firms etc. This court also fails
to understand as to how the alleged family settlement between the NLD Group
and BLD Group would be binding to the defendant companies and firms, apart
from the issue as to whether the alleged document dated 20.12.2007 could be
called a family settlement. Under the circumstances this court finds much
substance in the submission made by the learned counsel for the appellants
that the suit filed by the plaintiffs is not only bad for mis-joinder of
parties and of causes of action, but also for non-joinder of necessary
parties and that the suit in the present form would not be maintainable in
the eye of law.
7. So far as merits of the case are concerned, according to the
respondents-plaintiffs, all the properties mentioned in the Schedules 'Ka'
to 'Chha' annexed to the plaint, were purchased from the nucleus of the
joint family properties, and as per the family settlement dated 20.12.07,
the said properties were required to be divided amongst the family members
of the plaintiff No. 1 and the defendant Nos.1 to 9. In this regard, it is
pertinent to note that the entire suit of the plaintiffs is based on the so-
called family settlement which had allegedly taken place between the NLD
group and BLD group on 20.12.07. From the bare perusal of the said document
it transpires that it is the minutes of the meeting of Data Group Family
dated 20.12.07, which was signed by Mr. Vijay Data for NLD Group and Mr.
Babu Lal Data for BLD Group. Apart from the fact that there is not a
whisper in the said document that the corpus of the companies mentioned in
the said document was provided by the HUF or that the other properties
mentioned in the said document were the HUF properties, the said document
has also not been signed by the other coparceners of the alleged HUF except
by Mr. Vijay Data and Mr. Babu Lal Data. Such a document by no stretch of
imagination could be said to be a family settlement. However, even if it is
believed to be a family settlement, and even if it is held that the same
was not required to be signed by all the coparceners, then also there is
nothing on the record to suggest that it was a memorandum prepared after
the family arrangement which had already been made earlier, not required to
be registered. ………….
“9. In this regard it is pertinent to note that though the concerned
defendants had raised contentious issues as regards the maintainability of
the suit, mis-joinder of parties and of causes of action, suppression of
material facts by the plaintiffs etc., the lower court has not considered
the same and has held that the plaintiffs had established the prima facie
case in their favour. In the opinion of this court such a finding of the
lower court in the impugned order is not only erroneous but also perverse.
When the suit on the face of it suffered from the mis-joinder of parties
and of causes of action and was not prima facie tenable in the eye of law,
the lower court has committed serious error of law and facts in holding
that the plaintiffs had established a prima facie case. If the plaintiffs
were not entitled to the final reliefs in the suit, they could not be
granted temporary injunction as prayed for during the pendency of the
suit.”
7. We have heard learned counsel for the parties and have perused the
record. In the present case, the parties have raised similar pleas which
were taken before the High Court. However, we are of the opinion that while
dealing with a matter relating to vacation of order of temporary
injunction, it was not open for the High Court to give a finding on the
main issue relating to maintainability of the suit and the family
settlement reached between the parties.
8. In view of the finding aforesaid, we are inclined to interfere with
the judgment and order dated 14th March, 2012 passed by the High Court of
Judicature for Rajasthan, Bench at Jaipur in S.B. Civil Misc. Appeal
No.2218 of 2011 etc. We, accordingly, set aside the impugned judgment and
remit back the matter to the High Court for its fresh disposal after
hearing the parties.
9. The appeals stand disposed of with aforesaid observations.
……………………………………………………………………………J.
(SUDHANSU JYOTI MUKHOPADHAYA)
…………………………………………………………………………J.
(S.A.BOBDE)
NEW DELHI,
August 4, 2014.
