In Re: Associated Bank of Tripura, Ltd. (in liquidation)

Bachawat, J.—There are 132 applications in the list today being all matters u/s 45B of the Banking Companies (Amendment) Act.

u/s 45A of the Banking Companies Act, 1949, as amended by the Banking Companies (Amendment) Act, 1950 which came into force in March, 1950, the High Court exercising jurisdiction in the place where the registered office of the banking company, which is being wound up, is situated, is the Court for the purpose of that Act and so no other court has jurisdiction to entertain any matter relating to or arising out of the winding up of the banking company. u/s 45B of the Let, in respect of such company this Court has full power to decide all schemes made by or against any banking company and all questions of priorities and all other questions whatsoever, (sic) of law or of fact, which may relate to or arise in course of the winding up of such company.

It is well-known that a large number of banking companies is in liquidation. After the passing of this 1950 Act, a question (sic) as to how proceedings u/s 45B are to be instituted, ft was assumed by the general public and the legal profession that the proper mode of procedure was by way of an application. Accordingly, thousands of applications u/s 45B of the Banking Companies Act were made and numerous orders and decrees were passed on such applications.

On August 24, 1950, the Appeal Court consisting of the Chief justice and Banerjee J. decided in the case of Sree Bank, Ltd. v. P.C. Mukherjee ILR (1951) 2 Cal. 396 that a summary application u/s 45B of the Act is misconceived. The Appeal Court pointed out that the Act does not provide for a summary proceeding and in the absence of any provision to that effect, the remedy, if any, of the banking companies would be by way of a suit.

It is to be observed that u/s 45G of the Act, this Court lad power to make rules consistent with the Act concerning the mode of proceedings to be had for the decision of all claims or questions and all other proceedings. this Court has uptil now framed no rules on the point. In the absence of such rule and in view of the Appeal Court judgment, the applications which have been made before me are liable to be summarily dismissed.

In this state of affairs, the Petitioner companies applied before me orally for amendment of the petitions so as to convert them into plaints by suitable averments and to give all consequential directions. The Respondents did not oppose such applications being made orally. It is also conceded on behalf of the Respondents that the Petitioners have been so far proceeding bona fide and that these proceedings were instituted and were being prosecuted under the bona fide belief that a summary application sunder Section 45B is maintainable. The applications for amendment are made in those cases where there is a likelihood of bar of limitation if suits are instituted today.

Counsel for the Respondents argue that I have no power convert these petitions into plaints. I have no doubt that I have the inherent power to allow suitable amendments if the justice the case so requires. I apprehend that rules of procedure are but handmaids of justice and should be so moulded that justice is done.

On a perusal of the petition it appears that it consists of al the essential averments which ought to find place in the plaint Order VII, Rule 1 of the CPC primarily provide; for what the plaint ought to contain. I find that in all these applications all the necessary averments which ought to be made under Order VII, Rule 1, have been made. They contain the name of the court in which the proceedings have been brought, also the description and place of residence of the Plaintiffs and all the Defendants, the facts constituting the cause of action and showing that the court has jurisdiction and the relief which the (sic) prays for. In truth, it has been said that a plaint is but (a) private memorial addressed to the court setting forth the cause of action and invoking the court''s jurisdiction. I have no (sic) that the cause of action is fully set forth in the document which is in the form of petition and the jurisdiction of this Court is invoked for the purpose of granting relief.

There are undoubtedly precedents where the courts in the exercise of inherent powers have converted petitions into plaints and plaints into petitions. It is now provided by Section 47 of the CPC that in a proper case the court may treat an application u/s 47 as a suit and vice versa. Section 47(2) is, however, a new provision expressly introduced by the 1908 Act. Before this Act came into force and while the 1882 CPC was in operation, the court (sic) jurisdiction under its inherent powers to convert applications ink suits and suits into applications. It was held that if a party chooses a wrong form of procedure and files a suit where he ought to have filed an application or files an application where he ought to have filed a suit, there is an error only as to the mode of proceeding and the court could regularise it by treating the application as a suit and the suit as an application. The older cases are all collected in the judgment of Mookherjee J. in Monmohan Karmokar v. Dwarkanath Karmokar (1910) 12 C.L.J. 312. In this case, the Bench held that if necessary they would have treated the petition for execution as a plaint in a suit. The important older cases are the cases of Purmessuree Pershad Narain Singh v. Janki Kooer (1873) 19 W.R. 90; Azizuddin Hossein v. Rarnianugra Roy I.L.R.(1857) 14 Cal. 605; Biru Mahata v. Shyama Churn Khawas and Devendra Nath Bhattacharjee v. Prasanna Kumar Chakravarti (1907) 5 C.L.J. 328; where plaints were treated applications u/s 244 of the Code of Civil Procedure, 1882. (sic) power of treating applications as suits and suits as applications is not confined merely to applications u/s 244 of the (sic) Code or Section 47 of the 1908 Code, but has been exercised in (sic) proceedings as well. In Ananda Prosad Ghose Vs. Ronendra Lal Choudhury and Another, , Jack J. treated a suit as an application Section 26J of the Bengal Tenancy Act. In Deoki Nandan; (sic) v. Basantlal Ghanshyam Das ILR (1941) 2 Cal. 123. Lort Williams J. (sic) a suit as an application u/s 33 of the Indian Arbitration Act. In AIR 1940 92 (Nagpur) , a suit for specific performance was treated as an application for execution of the decree under C.P. Debt Conciliation Act. It is also well-known that memoranda of appeal are (sic) often treated as petitions for revision and by way of (sic) reference may be made to the case of Mohini Mohan Roy Ramdas Paramhansa (1923) 28 C.W.N. 271, 275.

Mr. Samaren Sen appearing on behalf of the Respondents argued, firstly, that the court can allow an amendment only if, the first instance, the jurisdiction of the court has been properly invoked. According to him, if the jurisdiction of the (sic) has not been properly invoked the court has no power, to ant an amendment. In my judgment this contention must be (sic). In almost all the cases which I have cited the jurisdiction had been invoked improperly and in a wrong manner. The (sic) Act barred a suit in which the arbitration agreement is impeached, yet such a suit was allowed to be converted into petition. The Bengal Tenancy Act contemplated and allowed (sic) summary applications for the purpose of determining (sic) u/s 26J of the Bengal Tenancy Act and a suit such purpose was not maintainable. Yet such a suit was sated as an application under that section. The effect of Section 244 the 1882 CPC was to bar applications for (sic) and suits in certain cases. Yet such misconceived suits (sic) applications were in proper cases treated as and allowed to converted into, proper proceedings. Mr. Sen said that there some distinction that while a suit can be converted into a petition, the contrary ought not to be allowed and a petition ought (sic) to be allowed to be converted into a suit. In my judgment, (sic), there is substantial authority against that contention, (sic) I take the view that the decision in Monmoham, Karmokar Dwarkanath Karmokar (supra) is an express decision to the (sic).

In the case Secretary of State for India in Council v. Pal Debee ILR (1935) 63 Cal. 677, a summary application u/s 302 of the Inc Succession Act was made to this Court in its testamentary-intestate jurisdiction asking for certain directions upon executor. It was contended by the Respondent that the (sic) mode of procedure was not by way of such application but was way of suit. Their Lordships of the Judicial Committee (sic) out that assuming that the correct procedure had not been follow the court exercising testamentary and intestate jurisdiction no inherent lack of jurisdiction to grant the proper relief the Respondent having submitted to the jurisdiction waived objection. It is settled law that waiver can cure an (sic) but cannot confer jurisdiction where the court has none. The is no doubt, therefore, that an error as to the form of proceed is merely an irregularity. If the incorrect form or procedure i been adopted there is no lack of inherent jurisdiction to relief. In the exercise of its jurisdiction, the court ought not grant relief where the wrong procedure has been followed but cannot be denied that in the exercise of its jurisdiction court may allow suitable amendments curing the error as to form.

Mr. Sen next contended that the Applicants must clear establish that there will be serious injustice if this application not granted and for that purpose they must demonstrate my satisfaction that the suit, if filed today, would be barred limitation. Mr. Sen said that very likely if the Petitioners suits today they would get the benefit of Section 14 of the (sic) Limitation Act. Mr. Sen, however, could not concede that Plaintiff would get the necessary exemption under that section I have no doubt that later on when a suit is filed the defends will take the point that Section 14 of the Limitation Act has no application.

Mr. Chowdhury, appearing on behalf of the Applicants, (sic) that it is a debatable point and the Defendant may very (sic) contend that it is not want of jurisdiction nor a defect of nature as contemplated by Section 14 of the Limitation Act. I have doubt in my mind that a serious question of limitation (sic) arise if the suits are filed today. The wrong mode of proceeding was adopted due to bona fide error which was common to every body including the members of the legal profession. It will in my judgment, a travesty of justice if due to this common (sic) large and genuine claims may be defeated by technical (sic). I have no doubt that serious injustice may result if I (sic) the present application.

Mr. Sen next contended, to my mind somewhat inconsistently that if a suit is filed today it would plainly be barred by limitation and the result of my allowing the amendment will be taking away the vested right which has accrued to his clients by lapse of time. Assuming such a suit would be barred today, I have no doubt that my power to allow the amendment is not taken away. If by common blunder on the part of the legal profession a wrong form of procedure has been adopted the court must see that justice is done and the litigant is allowed to put the proceeding in proper shape and form. In Charan Das v. Amir Khan I.L.R.(1920) 48 Cal. 110 where their Lordships of the Privy Council lay down the general rule with regard to amendments in the case of limitation they point out that in spite of the bar of limitation in a special case the court can allow an amendment.

Besides, in this case I take the view that the document, which was filed in this Court in the form of a petition, was substantially a plaint and was presented to this Court on the date when that document was filed in court. In Stuart Shinner v. William Orde (1879) I.L.B. 2 All. 241 a petition for leave to sue in forma pauperis was filed under the 1859 Code of Civil Procedure. The Code provided that if the application is granted the petition will be treated as a plaint and the Code also made provision as to the legal consequence in case of rejection of such a petition. There was, however, no express provision in the Code as to what would happen if the Petitioner paid the proper court-fees after amending the petition. In the case before the Judicial Committee the cause of action accrued in April, 1861 and a suit brought after April, 1873, would have been barred by limitation. A petition to sue in forma pauperis was presented in the proper court in February, 1873. On November 27, 1874, before the petition was finally disposed of the Petitioner paid full court-fees and thereafter, the matter proceeded upon the footing that the petition was the plaint. The Defendant took the point that the court-fees being paid in November, 1874, the suit must be deemed to have been instituted on that date and if so instituted it was quite clearly barred by limitation. But the Judicial Committee repelled that contention and held that the suit was not barred by limitation. Their Lordships of the Judicial Committee held that although the court-fees were paid at a later date the plaint must be treated to be always on the file and must be treated as if it were on the file on the date on which it was presented to court as a petition to sue in forma pauperis. In my judgment this case is ample authority for the proposition that the petition in this case ought to be treated as a plaint and that there is no bar of limitation notwithstanding Section 3 of the Indian Limitation Act.

If I order that the petition be treated as a plaint such plaint must be treated as being always on the file of the court and must be treated as if it were filed on the date on which the petition was presented to this Court. In Monmohan Karmoltar v. Dwarkanath Karmokar (supra) the court held that where the petition for execution was presented within the period of limitation there is no question of limitation and the petition may be treated as a plaint.

It is to be borne in mind that the petition is verified by an affidavit and is accompanied by a warrant of attorney to institute the summary proceeding. The petition until now was not treated as a plaint and there is no verification as required in a plaint nor has any warrant to institute a suit been given to the attorney. If I treat the petition as a plaint leave should also be given to regularise the proceedings by proper verification and by filing a proper warrant to sue and by observing all other forms of procedure which are usually observed where a plaint is presented to this Court. Mr. Samaren Sen concedes and in my judgment rightly, that I should so regularise the proceedings if I reject his other contentions. It is fair and just to allow such defects to be cured even though the cause of action is barred by limitation on the date of the amendment. In Mohini Mohan Das v. Buddan Saha Das I.L.R.(1889) 17 Cal. 580 their Lordships of the Judicial Committee allowed a co-Plaintiff to sign and verify a plaint after the expiry of the period of limitation. In Ali Muhammad Khan v. Ishaq Ali Khan ILR (1931) 54 All. 57 the plaint had not been verified nor had any warrant to sue been given by the Plaintiff to the pleader who presented the plaint, yet a Full Bench of the Allahabad High Court allowed the defect to be cured after the period of limitation had expired. The amendment is retro-active and takes effect from the date of the original filing, Chhayemannessa Bibi v. Basirar Rahman ILR (1910) 37 Cal. 399 ; I will, therefore, make the following order:

I allow the petition to be amended in the manner shown in red ink in a copy of the petition filed in Court. There will also be an order for consequential amendment of the cause title and suit register, if necessary. I direct that the petition be treated as plaint and such plaint be treated as having been presented on the day on which the petition was filed in court or on the day on which it was presented in court and noted as made whichever is earlier. The attorney for the Applicant undertakes to complete this order for amendment as expeditiously as possible and to have the amendments made in the original petition thereafter as soon as possible. The Applicant will be at liberty to have the amended pleadings verified by the proper officer. The Applicant will be at liberty to file in the office a proper warrant to sue, a concise statement, a list of documents upon which he relies, a list of documents produced with the plaint, exhibits or copies of exhibits filed, the requisite number of printed forms of writs of (sic) duly filled up as provided for in Rules (1) and (2)(a) of VII of our Rules which are used in commercial suits and also; affidavit of competency as required by Ch. VII, Rule 8 of our (sic) if necessary. The Applicant will also be at liberty to (sic) back the original documents filed with the petition and to (sic) copies instead of the originals. The Applicant''s attorney dertakes to put in the requisite court-fee stamps for the purpose the plaint. All these directions must be complied with within weeks. The suits will be marked as commercial suits.

On being satisfied that Ch. VII, Rules (1), (2)(a) and 8 have been (sic) complied with and that the plaint has been duly verified d proper court-fees have been paid the learned Master will (sic) the necessary endorsement on the plaint to the effect that is treated as presented on the date mentioned above and there (sic) writ of summons upon the Defendant be issued as in corner (sic) suits. The proper officer will fix the date of entering appearance under such summons under Ch. VIII, Rule 4, having gard to the date of the order for the issue of the writ.

I consulted the learned Master in open court and he assured (sic) that there would be difficulty with regard to the numbering (sic) ledgering of the suit. He will be at liberty to put such suit number as he may think fit.

The Applicant will pay all costs of the Respondent incurred to date including the costs of today''s appearance, if such Respondent appears and asks for costs. The Liquidator will be at (sic) to retain out of the assets the costs of the proceedings up date. In the absence of a special order such costs will be passed at Its. 170.

The respective attorneys for the Applicants must pay in each (sic) every case where an amendment has been directed, requisite (sic) stamps for the purpose of moving a formal application (sic) amendment and also for the purpose of completing and filing (sic) order for amendment.