G. McKenzie and Co. (1919) Ltd. vs Tatanlal Surajmall

Rowland, J.—This is an application by the defendant in an account suit to revise the order of the Subordinates Judge of Ranchi refusing him permission to amend his written statement. The suit was instituted on 20th December 1928, and the original written statement was presented on 2nd March 1929. The plaintiffs were a firm carrying on business as general traders and merchants in Ranchi and the defendants were a firm having their headquarters in Calcutta and dealing in motor cars and accessories. On 27th March 1926 the defendant firm having the agency for sale of certain motor-cars appointed the plaintiff firm as their sub-agents for a period of one year for the purpose of selling certain makes of cars and accessories. On 28th March 1927 the defendant firm again appointed the plaintiff firm as their sub-agents as before for a period of one year. According to the terms of the contract the plaintiff firm would be entitled in certain circumstances to various credits and commissions.

The substantial defence taken was that for a part of the period in suit the accounts had already been adjusted; that the second contract commencing in March 1927 did not run for the full period of a year but it terminated earlier; and that on the whole series of transactions a sum of not more than approximately Rs. 217 was due from the defendant firm to the plaintiff firm. The parties went to trial before the Subordinate Judge who, on 29th March 1930, passed a preliminary decree for the taking of accounts between the parties on the basis of the contracts, holding that the second year''s contract had in fact terminated on 16th February 1928. There wore other findings on points of detail to which I need not refer. Against the preliminary decree the defendant firm appealed to the Judicial Commissioner of Chota Nagpur who subject to certain observations and modifications of detail, substantially affirmed the preliminary decree passed by the Subordinate Judge. In the meantime on inspection of the books of the defendant firm, the plaintiff having ascertained that some motor cars had been sold by the defendant firm within the territories to which the contract related had on 6th May 1930, filed a supplementary list. Reference appears to have been made to this list in the course of the hearing of the appeal before the Judicial Com-missioner who observed that:

If they (the plaintiff firm) are putting in a supplementary claim, you can put in a supplementary written statement.

The defendant firm did in fact put in a supplementary written statement on 14th August 1933, objecting to paying commission to the plaintiff firm on the sale of certain motor cars which took place on 8th December 1926, and 27th March 1927, on the ground that those cars had been sold through other persons and not through the plaintiff. That written statement was accepted by the Court. The present application for revision arises out of the application made on 15th November 1934, to amend the original written statement of 2nd March 1929 by expunging an admission that plaintiff firm were sub-agents for the defendant firm from March 1926 to March 1927, and to substitute for it a pleading that the agency was terminated with effect from 8th December 1926, by reason of a registered letter dated 8th October 1926, sent by the defendant firm to the plaintiffs. The Subordinate Judge has refused to allow the pleading to be amended and in the course of his order he gives several reasons. In the first place he finds it difficult to believe that the original admission in the pleading of 2nd March 1922 was made under a bona fide misapprehension; secondly he is of the opinion that there has been very great delay in preferring this application, and thirdly, he considers that no amendment could now be allowed without going behind the preliminary decree, the correctness of which was agitated in appeal before the Judicial Commissioner and which has become final against the defendant firm.

Now the first of these grounds may not be entirely satisfactory. A party who has defence to put forward will not be ordinarily debarred or forbidden by the Court from putting it forward on the ground that this defence is improbable and prima facie unconvincing. If it were otherwise, many written statements might have to be rejected. Mr. De argued with some eloquence and at length that whatever opinion the Court might have formed prima facie as to the merits of this new defence of his would not be a good reason for shutting it out from consideration on the merits and on evidence.

As regards the second point it has been often observed that delay by itself is not an adequate reason for refusing permission to amend a pleading. I do not think I need discuss at length the arguments of both sides on this aspect of the question. It will be sufficient to indicate my own view that the significance of delay lies not in the quantity of time that has elapsed but in what has transpired during that time. The main point in considering whether leave should be granted to any party to amend his pleading is whether in the words of O. 6, R. 17, the amendment is "necessary for the purpose of determining the real questions in controversy between the parties." The general trend of the authorities that have been cited before me establishes two complimentary propositions: firstly, that the determination of the real questions in controversy is the prime object of the frame and settlement of the pleadings; and, on the other hand, that leave to amend should not be granted if the amendment would convert the case set up into another of a different and inconsistent character. It is correctly said in Mulla''s notes:

The Court will not allow an amendment that would involve a complete change of front in the defence.

Applying these principles to the case before me, I find that the proceedings in their earlier stages were taken on the footing that the period to be accounted for between the parties included the whole of the year from 27th March 1926 to 26th March 1927. There was no dispute about this period. Undoubtedly if the defendant firm wished to raise a dispute about it, the written statement was the proper place and time for them to do so. In fact they did dispute the period of the duration of the second year''s agency from 28th March 1927 onwards and the period of this contract was ascertained by the Court on contest. When the defendant up to that stage permitted the period of the first contract to go undisputed, I think it is too late for them now to turn round and contest the suit on an entirely different basis. It has been pointed out by the Subordinate Judge that the question of the period for which accounts are to be rendered cannot now be re-opened without going behind the preliminary decree passed on contest by the Subordinate Judge and by the appellate Court. In my opinion the change in pleading now proposed is one that could not be allowed without altering the nature of the case. Therefore so far from this being a fit case for interference in revision with the order of the Subordinate Judge, it seems to me more probable that this Court might have found itself bound to interfere had the Subordinate Judge acceded to the prayer of the defendant for amendment of his pleading. In the result the application is dismissed with costs; hearing fee five gold mohurs.