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Case Number

Letters Patent Appeal No. 103 of 1959

Attorney(S)

D.N. Aggarwal
D.N. Awasthy

Judges

A.N Bhandari, C.J
D. Falshaw, J.

Acts

Code of Civil Procedure of 1908. Section 153 of that Code
Order VI Rule 17,The Court
O. XXI Rule 103

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Smart Summary

Judgment Summary — Falshaw, J. (Letters Patent Appeal)

Factual and Procedural Background

The appeal arises under Clause 10 of the Letters Patent against an order of Chopra J. that accepted a second appeal and remanded the suit to the trial Court for fresh decision after allowing the plaintiff to amend his plaint.

The substantive dispute was between two brothers, Kartar Singh (appellant) and Sardara Singh (respondent). Sardara had been adopted by Rattan Singh and on Rattan Singh's death in 1940 succeeded to his property, including about 30 bighas of land. Their natural father, Wazir Singh, died in 1948 leaving about 12 bighas. At that time Kartar Singh was in Calcutta running a taxi business. Sardara caused mutation of their father's 12 bighas in the names of the brothers in equal shares.

The brothers executed a registered settlement deed dated 26 September 1949 under which Sardara agreed to transfer one-half of the land inherited from his adoptive father (Rattan Singh) to Kartar, and Kartar was to transfer one-half share of his taxis to Sardara. The deed contained a stipulation that if either party reneged the other could claim damages or specific performance. Kartar filed a suit for specific performance on 12 December 1949 which resulted in a compromise on 14 January 1950 reflecting the same terms.

In 1952 Kartar applied for partition possession of one-half share of the land; Sardara objected alleging non-performance by Kartar. The land was nonetheless partitioned and mutation sanctioned on 15 September 1952.

Sardara instituted the present suit in February 1953 seeking restoration of possession of the land transferred in September 1952, alleging the agreement and compromise were procured by fraudulent misrepresentation by Kartar, who knew that under Calcutta law taxi ownership could not be transferred at that time. Kartar denied fraud and averred that Sardara had in fact been to Calcutta and taken over two of the four taxis but later abandoned the business.

The trial Court and the first appellate Court found no fraudulent misrepresentation; it was found that transfers of taxis and permits were possible up to December 1951 and thereafter barred except in favour of legal heirs. On these findings Sardara's suit and his first appeal were dismissed.

The Single Judge (Chopra J.) also found no fraud but considered Kartar had behaved unfairly and refused to accept frustration of contract. Chopra J. allowed a last-minute application to amend the plaint to claim damages as an alternative relief, remanding the matter to the trial Court for fresh trial on that basis. The present Letters Patent appeal challenges that allowance of amendment and remand.

Legal Issues Presented

Whether a Court may permit amendment of a plaint which, if allowed, would effectively set up a new and distinct cause of action that changes the real matter in controversy between the parties (i.e., permitting a claim for damages for breach where the original case was for rescission/restoration on ground of fraud).
Whether the particular amendment allowed by the Single Judge — permitting Sardara to amend his plaint to claim damages after his fraud case was rejected — was legally permissible under the principles governing amendments (including the Code of Civil Procedure provisions cited).

Arguments of the Parties

Appellant's Arguments (Kartar Singh)

The appellant contended that no amendment to the plaint could be permitted which changed the nature of the suit or substituted one distinct cause of action for another.
Reliance was placed upon Privy Council decisions: Ma Shwa Mya v. Maug Mo Hnaung (AIR 1922 PC 249) and Kanda v. Waghu (AIR 1950 PC 68), which were cited to show that amendments which introduce a new and independent case or change the real subject-matter in controversy are impermissible.

Respondent's / Other Side's Arguments (Sardara Singh and supporting authority)

The respondent sought, by amendment, to claim the alternative relief of damages for breach of contract after the fraud-based claim had been rejected; the Single Judge allowed this amendment.
Reliance was placed on the Supreme Court decision in Pirgonda Hongonda Patil v. Kalgonda Shidgonda Patil (AIR 1957 SC 363), in which an order permitting amendment was upheld; that case was said to involve an amendment which did not introduce a new case (specifically an application under O. XXI r. 103 to give further particulars after limitation had expired).

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Ma Shwa Mya v. Maug Mo Hnaung, AIR 1922 PC 249	Amendments may be liberally allowed, but a court has no power to permit substitution of one distinct cause of action for another or to change the subject-matter of the suit by amendment.	The Court relied on this authority to support the proposition that the Single Judge should not have allowed an amendment that effectively set up a fresh case different from the one tried and rejected; the judgment's passage stressing that one cannot permit a new and independent contract to be introduced was applied to deny the amendment.
Kanda v. Waghu, AIR 1950 PC 68	Powers of amendment must be exercised within legal limits; an amendment that alters the real matter in controversy and sets up a new case cannot be allowed.	The Court treated this as a strong authority favouring the appellant: it supported the conclusion that the District Judge (and by analogy the Single Judge here) erred in permitting an amendment which created a new case and changed the controversy between the parties.
Pirgonda Hongonda Patil v. Kalgonda Shidgonda Patil, AIR 1957 SC 363	Upheld an order permitting amendment of a plaint where the amendment did not introduce a new case (in that instance an application under O. XXI r. 103 for particulars after limitation).	The Court noted this decision as relied upon by the other side but distinguished it on its facts: in Pirgonda the amendment did not amount to a fresh case, whereas in the present matter the amendment would introduce a different cause of action and require fresh issues and evidence.

Court's Reasoning and Analysis

The Court proceeded by first setting out the factual findings made by lower courts: the trial Court and first appellate Court found no fraudulent misrepresentation by Kartar Singh; it was established that transfers of taxis and their permits in Calcutta were possible up to December 1951 and thereafter (post-December 1951) transfers other than to legal heirs were barred. On that factual basis the plaintiff's fraud-based claim failed and his suit was dismissed at both levels.

The Single Judge nevertheless allowed a late application by the plaintiff to amend the plaint to plead an alternative relief of damages for breach of contract and remanded the suit for fresh trial.

Falshaw, J. examined the governing principles on amendment. He quoted the provisions of the Code of Civil Procedure relied upon by the parties: Section 153 of the Code (permitting amendment of defects or errors to determine the real question in issue) and Order VI Rule 17 (allowing amendment of pleadings at any stage as may be necessary to determine the real questions in controversy). He then considered the Privy Council authorities (Ma Shwa Mya and Kanda v. Waghu) which establish that these powers do not extend to permitting one distinct cause of action to be substituted for another or to changing the subject-matter of the suit by amendment.

Applying these principles to the present facts, the Court assessed the nature of the original case: Sardara's pleaded case (and the one tried and rejected) was that the agreement and later compromise were procured by fraudulent misrepresentations made by Kartar Singh, rendering the contract void ab initio and entitling Sardara to restoration of the status quo (possession of the land).

The proposed amended case after rejection of fraud was that Kartar Singh had committed a breach of contract by failing to perform his obligations, entitling Sardara to damages. The Court reasoned that this is not merely an alternative relief within the same cause of action; rather, it amounts to a fresh case based on different grounds, which would require framing new issues and adducing evidence (in particular evidence on the quantum of damages) not led under the original pleadings and trial.

The Court distinguished the Pirgonda decision relied upon by the respondent on the ground that in Pirgonda the amendment did not introduce a new case but merely provided further particulars and did not change the real matter in controversy. By contrast, the amendment allowed below would change the real matter in controversy—substituting restitution for rescission with a claim for damages—and therefore exceeded the permissible scope of amendment.

On this analysis the Court concluded that the Single Judge erred in permitting the amendment and remand; allowing it amounted to permitting the plaintiff to institute virtually a fresh suit under the guise of amendment.

Holding and Implications

Holding: The Letters Patent appeal is allowed. The Court accepted the appeal, set aside the order allowing amendment and remanding the suit, and restored the decree of the trial Court (as affirmed by the Court of first appeal) dismissing the plaintiff's suit.

Implications: The direct effect is that Sardara Singh's suit, which had been dismissed by the trial Court and affirmed on first appeal, remains dismissed; the permission granted by the Single Judge to amend the plaint to claim damages and the consequent remand are set aside. The Court directed that the parties bear their own costs throughout. The opinion applies established principles limiting the scope of procedural amendment and does not purport to lay down a novel rule beyond applying those authorities to the facts; no broader change in precedent beyond the application of cited authorities is stated in the judgment.

Additional disposition noted in the record: Bhandari, C.J. concurred; the formal entry records "Appeal allowed."

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Kartar Singh v. Sardara Singh

Falshaw, J.:— This is an appeal under Cl. 10 of the Letters Patent against the decision of Chopra J. accepting a second appeal and remanding the suit to the trial Court for fresh decision after allowing the plaintiff to amend his plaint.

2. The facts are that the appellant Kartar Singh & the respondent Sardara Singh are brothers. Sardara Singh, however, had been adopted by one Rattan Singh, on whose death in 1940 Sardara Singh had succeeded to his property including about 30 bighas of land. Wazir Singh, father of the parties died in 1948 leaving; about 12 bighas of land. At that time Kartar Singh was away running a taxi business in Calcutta, and Sardara Singh got the land of Wazir Singh mutated in the names of the brothers in equal shares, although it is evidently a moot point whether, having succeeded to the whole estate of his adoptive father, Sardara Singh was entitled to succeed to any part of his natural father's estate.

3. This led to a dispute between the brothers who reached a settlement on the 26th September 1949 by means of a deed which was registered. The terms of the agreement were that Saradara Singh would transfer one-half of the land he inherited from his adoptive father to Kartar Singh while the latter was to transfer one-half share of his taxis to Sardara Singh, there being a stipulation that if either of the brothers went back on the agreement the other would be entitled to damages or to sue for specific performance of the agreement. On the 12th of December 1949 Kartar Singh actually brought a suit for specific performance which ended in a compromise on 14-1-1950 in which the terms of the original agreement were repeated. In 1952 Kartar Singh applied for possession by partition of one-half share of the land inherited by Sardara Singh from Rattan Singh. Sardara Singh objected on the ground that Kartar Singh had not performed his part of the contract. However, the land was partitioned and the mutation sanctioned on 15-9-1952.

4. The suit from which this appeal has arisen was instituted by Sardara Singh in February 1953. He claimed possession of the land which had been transferred to Kartar Singh in the previous September on the ground that the agreement and the subsequent compromise on the same lines had been entered into by him as a result of fraudulent misrepresentation made by Kartar Singh, who was aware at that time that according to the laws in force in Calcutta, ownership of the taxis could not be transferred to any other person. Kartar Singh denied that there had been any fraud and alleged that the plaintiff had actually been to Calcutta, and taken over the two of the four taxis which he was running, but had given up the business because it was not profitable and because he was called on to pay his share of certain instalments which were due on the taxis.

5. Both the trial Courts and the Court of first appeal found that in fact the original agreement and subsequent compromise had not been entered into as the result of any fraudulent misrepresentation made by Kartar Singh. It was in fact proved that up to December 1951 there was no bar to the transfer of taxis and their permits in Calcutta, but thereafter transfers other than those in favour of legal heirs were barred by law. On this finding the plaintiff's suit was dismissed as also his first appeal.

6. The learned Single Judge also found that there was no fraud on the part of Kartar Singh in inducing Sardara Singh to enter into the agreement and compromise, but at the same time the found that Kartar Singh had certainly behaved unfairly in obtaining the benefit which he was entitled to under the agreement and compromise and denying Sardara Singh any consideration or compensation. He also refused to accept the plea that the contract had been frustrated, since it had only become incapable of performance after December 1951. He decided, however, that a last-minute plea made on behalf of the plaintiff-appellant to amend the plaint so as to claim the alternative relief of damages should be allowed and remanded the suit to the trial Court for this purpose and for fresh trial.

7. It is contended on behalf of the appellant that no amendment, of the plaint could possibly be allowed which changed the nature of the suit. Reliance in this connection was placed on two decisions of Privy Council in Ma Shwa Mya v. Maug Mo Hnaung, AIR 1922 PC 249 and Kanda v. Waghu, AIR 1950 PC 68. The first of these cases related to a suit brought in 1913 for specific performance of an alleged verbal contract made in 1912 for the transfer of certain land for oil wells. The suit was dismissed by the trial Court which found that the alleged verbal contract was not proved, but in appeal before the Judicial Commissioner the plea was taken that the plaintiff should be allowed to amend his plaint and base his suit on an agreement entered into in 1903. The order of the Judicial Commissioner accepting this plea and allowing the amendment of the plaint was challenged in appeal to the Privy Council and it was held by their Lordships that the amendment should not have been allowed. The following passage occurs in the judgment which was delivered by Lord Buckmaster:

“The first question that arises is whether or no that leave to amend was properly given in accordance with the rules by which that leave must necessarily be regulated. All rules of Courts 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.

8. The provisions as to amendment are those that are to be found in the Code of Civil Procedure of 1908. Section 153 of that Code enacts that ‘The Court may at any time and on such terms as to costs or otherwise as he may think fit amend any defect or error in any proceeding in a suit; and all necessary amendments shall be made for the purpose of determining the real question or issue raised by or depending on such proceeding and by Order VI Rule 17,

‘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.’

9. The real question in controversy between the parties in these proceedings was the existence and the character of an agreement alleged to have been made in 1912 for the delivery of certain sites of oil wells specified and identified by the numbers stated in the plaint, which could only have been delivered in respect of that subsequent bargain. When once that contract has been negatived, to permit the plaintiff to set up and establish another and an independent contract altogether would, in their Lordships' opinion, be to go outside the provisions established by the Code of Civil Procedure, to which reference has been made. It would be a regrettable tiling if, when in fact the whole of a controversy between two parties was properly open, rigid rules prevent its determination, but in this case their Lordships think that the rules to have that operation and that it was not open to the Court to permit a new case to be made.”

10. In the second of these cases it was again held that the powers of amendment must be exercised in accordance with legal principles, and an amendment which involves the setting up of a new case and alters the real matter in controversy between the parties cannot be allowed. This is a particularly strong case from the point of view of the present appellant. The appeal was from the High Court at Lahore and the case was one in which certain reversioners had challenged an alienation by a widow on the ground that the property suit was ancestral and that she had no power to alienate it. The suit was dismissed by the trial Court which inter alia found that the land was not ancestral. In first appeal the District Judge held that the parties were governed by custom and sent the case back to the trial Court for decision on the further issue, which did not arise out of the pleadings, regarding whether the gift was invalid even on the finding that the land was not ancestral. In second appeal Bhide J. held that the District Judge had erred in setting up a new case for the plaintiffs and dismissed their appeal. This order was upheld both in a Letters Patent Appeal and by their Lordships of the Privy Council.

11. On the other side reliance was placed on the decision of the Supreme Court in Pirgonda Hongonda Patil v. Kalgonda Shidgonda Patil, (S) AIR 1957 SC 363 in which an order permitting an amendment of the plaint was upheld. It seems, however, that in that case the plaintiff in a suit brought under O. XXI Rule 103 had merely applied to amend his plaint by giving further particulars after the period of limitation for the institution of the suit had expired, and it was held that the amendment did not involve in any way the introduction of a new case.

12. In my opinion, however, it can hardly be said that the amendment of the plaint which has been allowed in the present case does not amount to setting up a fresh case on behalf of the plaintiff. The case set up by him, which has been rejected by the trial Court and the first appellate Court, was that he had been induced to enter into the original agreement and the subsequent compromise on the same lines by his brother by means of false representations, which his brother knew to be false at the time when they were made, and that since this rendered the contract void ab initio the was entitled to the restoration of the status quo, i.e, to the restoration of the possession of the land which he had surrendered to his brother, in pursuance of his part of the contract.

13. The case now sought to be set up, after it has been found that no fraud has been established and that therefore the contract was not void, is that Kartar Singh has committed a breach of the contract by not carrying out his part of it and therefore the plaintiff is entitled to damages for breach of the contract. A suit based on a plaint on these lines will obviously involve framing of fresh issues and the leading of a good deal of evidence, which has not been led in the suit as originally framed, regarding the quantum of damages in case the defendant were to be held liable for a breach of the contract.

14. It is not merely a case of claiming an alternative relief which could have been claimed in the suit as originally framed, but it is a case of a different relief sought on different grounds. I am therefore of the opinion that although it is impossible not to sympathise with the plaintiff he ought not to have been allowed permission to institute virtually a fresh suit under the guise of amending his plaint. I would accordingly accept the appeal and restore the decree of the trial Court, affirmed by the Court of first appeal dismissing the plaintiffs suit, but I consider that this is a fit case in which the parties can be left to bear their own costs throughout.

15. Bhandari, C.J:— I agree.

BD/D.H.Z

16. Appeal allowed.

Kartar Singh v. Sardara Singh

Judgment Summary — Falshaw, J. (Letters Patent Appeal)

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellant's Arguments (Kartar Singh)

Respondent's / Other Side's Arguments (Sardara Singh and supporting authority)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Kartar Singh v. Sardara Singh

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