IMPORTANT POINT
Dominant object to allow amendment in pleadings liberally is to avoid multiplicity of proceedings but one distinct cause of action could not be substituted for another nor subject matter of suit could be changed.

Headnote:(i) Civil Procedure Code, 1908—Section 80—Suit in respect of certain claims regarding work of excavation, lining and construction of structures executed by plaintiff contractor was decreed—Plaintiff had moved applicable for dispensing with notice u/s. 80 CPC and trial Court allowed the application—High Court upheld the decree—Appeal—Question whether or not suit by contractor was maintainable because of alleged non-compliance with Section 80 CPC—Service of notice u/s 80 CPC was a condition precedent for institution of suit against Govt. or public officer—Sub-section (2) carved out exception where suit was for purpose of obtaining an urgent and immediate relief—Leave of Court was a condition precedent and such leave must precede institution of suit—Impugned order by trial Court though was alleged to be cryptic, Judge opined that suit was for obtaining an urgent and immediate order—State had not raised specific objection in that regard—Not a fit case where matter should be remanded back for reconsideration.
       Held : The service of notice under Section 80 is, thus, a condition precedent for the institution of a suit against the Government or a public officer. The legislative intent of the Section is to give the Government sufficient notice of the suit, which is proposed to be filed against it so that it may reconsider the decision and decide for itself whether the claim made could be accepted or not. As observed in Bihari Chowdhary (supra), the object of the Section is the advancement of justice and the securing of public good by avoidance of unnecessary litigation.(Para 13)
       Thus, from a conjoint reading of sub-sections (1) and (2) of Section 80, the legislative intent is clear, namely, service of notice under sub-section (1) is imperative except where urgent and immediate relief is to be granted by the Court, in which case a suit against the Government or a public officer may be instituted, but with the leave of the Court. Leave of the Court is a condition precedent. Such leave must precede the institution of a suit without serving notice. Even though Section 80(2) does not specify how the leave is to be sought for or given yet the order granting leave must indicate the ground(s) pleaded and application of mind thereon. A restriction on the exercise of power by the Court has been imposed, namely, the Court cannot grant relief, whether interim or otherwise, except after giving the Government or a public officer a reasonable opportunity of showing cause in respect of relief prayed for in the suit.(Para 16)
       Having regard to the legislative intent noticed above, it needs little emphasis that the power conferred in the Court under sub-section (2) is to avoid genuine hardship and is, therefore, coupled with a duty to grant leave to institute a suit without complying with the requirements of sub-section (1) thereof, bearing in mind only the urgency of the relief prayed for and not the merits of the case. More so when want of notice under sub-section (1) is also made good by providing that even in urgent matters relief under this provision shall not be granted without giving a reasonable opportunity to the Government or a public officer to show cause in respect of the relief prayed for. The provision also mandates that if the Court is of the opinion that no urgent or immediate relief deserves to be granted it should return the plaint for presentation after complying with the requirements contemplated in sub-section (1).(Para 17)
       Bearing in mind the afore-noted legal position, we advert to the facts in hand. As noted above, the subordinate Judge, vide Order dated 2nd February, 1993 came to the conclusion that "there was no tenable ground to refuse the relief asked for". Though there may be some substance in the submission of Mr. Choudhary, learned senior counsel appearing for the State, that the order allowing the application, seeking dispensation of the requirement of notice, is cryptic but the fact remains that by allowing the application, after hearing the defendant State, the Judge has opined that the suit is for the purpose of obtaining an urgent and immediate order. Had the satisfaction been against the contractor, the Court was bound to return the plaint to the contractor for re-presentation after curing the defect in terms of sub-section (1) of Section 80. Although we do not approve of the manner in which the afore-extracted order has been made and the leave has been granted by the subordinate Judge but bearing in mind the fact that in its reply to the application, the State had not raised any specific objection about the maintainability of the application on the ground that no urgent and immediate relief had either been prayed for or could be granted, as has now been canvassed before us, we are of the opinion that having regard to the peculiar facts and the conduct of both the parties it is not a fit case where the matter should be remanded back to the subordinate Judge for re-consideration. We find it difficult to hold that the order passed by subordinate Judge on contractors application under Section 80(2) C.P.C. was beyond his jurisdiction. Accordingly, we decline to interfere with the finding recorded by the High Court on this aspect of the matter. The High Court has held that having participated in the original proceedings, it was not now open to the State to raise a fresh issue as to the maintainability of the suit, in view of waiving the defect at the earliest point of time. The High Court has also observed that knowing fully well about non-issue of notice under Section 80 C.P.C. the State had not raised such a plea in the written statement or additional written statement filed in the suit and therefore, deemed to have waived the objection. It goes without saying that the question whether in fact, there is waiver or not necessarily depends on facts of each case and is liable to be tried by the Court, if raised, which, as noted above, is not the case here.(Para 18)
       (ii) Civil Procedure Code, 1908—Order 6 Rule 17—Amendment of plaint —Dominant object to allow amendment liberally was to avoid multiplicity of proceedings—However one distinct cause of action could not be substituted for another nor subject matter of suit could be changed—Initially a petition u/s 8 & 20 of Arbitration Act by amendment application was sought to be converted into a civil suit—Absence of any finding by High Court on the aspect—Matter needed to be remanded back to High Court.
       Held : Principles governing amendment of pleadings are well-settled. Order VI Rule 17 C.P.C. deals with the amendment of pleadings and provides that the Court may at any stage of the proceedings allow either party to alter or amend pleadings in such a 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. It is trite that though an amendment cannot be claimed as a matter of right under all circumstances, yet the power to allow the amendment is wide and can be exercised at any stage of the proceedings in the interest of justice. It is equally well-settled that unless serious injustice or irreparable loss is likely to be caused to the other side, the Court should adopt liberal approach and not a hyper-technical approach particularly in a case where the other side can be compensated with costs. Dominant object to allow the amendment in the pleadings liberally is to avoid multiplicity of proceedings (See: L.J. Leach & Co. Ltd. & Anr. Vs. M/s. Jardine Skinner & Co., AIR 1957 SC 357, Smt. Ganga Bai Vs. Vijay Kumar & Ors., (1974) 2 SCC 393 and B.K. Narayana Pillai Vs. Parmeswaran Pillai & Anr, (2000) 1 SCC 712. Nevertheless, one distinct cause of action cannot be substituted for another nor the subject-matter of the suit can be changed by means of an amendment.(Para 20)
       Incidentally, the order passed by the subordinate Judge allowing the amendment application has not been filed but learned counsel appearing for both the parties have stated before us that it was identical to the one passed in the Application under Section 80(2) C.P.C. (I.A. No. 3 of 1993), extracted above. Before the High Court it was argued on behalf of the State and so before us that since the amendment prayed for had the effect of changing the nature and character of the suit, it could not be allowed. However, we find that though the submission has been noted but somehow in the impugned judgment the High Court has altogether omitted to deal with the aspect of amendment of the plaint and straight away proceeded to decide the claims on merits. Initially filed as a petition under Sections 8 and 20 of the Arbitration Act, by means of an application under Order VI Rule 17 C.P.C. it was sought to be converted into a civil suit. It is pleaded before us that the original petition was also, in fact, in the nature of a civil suit as the court fee paid was much more than what was required to be paid on a petition under the Arbitration Act. We are of the considered view that in the absence of any finding by the High Court on this aspect of the matter, it will not be proper for us to comment on the validity of the order passed by the subordinate Judge on contractors application seeking amendment of the plaint/petition, particularly when, as noted above, the High Court, in its order dated 13.11.1992 had observed that in the absence of any claim for a specified amount, the suit, originally filed by the contractor, was not maintainable. We feel that certain factual aspects may also have to be gone into by the High Court in the First Appeals filed by the State, wherein orders passed by the subordinate Judge on 2.2.1993 (in I.A. Nos. 1 and 3/1993) had been challenged. Under these circumstances, we deem it just and proper to remand the matter back to the High Court for consideration of the issue with regard to the maintainability and the merits of the application filed by the contractor under Order VI Rule 17 C.P.C.(Para 22)

Judgement Key Points

Based on the provided legal document, here are the key points:

Service of Notice under Section 80 CPC is a Condition Precedent: The service of notice under Section 80 of the Civil Procedure Code is a mandatory condition precedent for instituting a suit against the Government or a public officer, serving the legislative intent of allowing the government to reconsider the decision and avoid unnecessary litigation (!) (!) .
Exceptions for Urgent Relief: An exception exists under Section 80(2) where a suit may be instituted without prior notice if it seeks an "urgent and immediate relief," but this requires the leave of the Court, which must be granted only after the Court is satisfied that such relief is necessary and after giving the government a reasonable opportunity to show cause (!) (!) .
Waiver of Objection: The State is deemed to have waived the objection regarding the non-compliance with Section 80 CPC because it participated in the proceedings, filed written statements without raising the plea at the earliest opportunity, and did not challenge the Trial Court's order dispensing with the notice (!) .
Liberal Approach to Amendment: The dominant object of allowing amendments under Order VI Rule 17 CPC is to avoid multiplicity of proceedings; therefore, courts should adopt a liberal approach unless serious injustice or irreparable loss is caused to the other side (!) (!) .
Limitations on Amendment: While amendments are liberally allowed, one distinct cause of action cannot be substituted for another, nor can the subject matter of the suit be changed through amendment (!) .
Remand for High Court Consideration: The Supreme Court remanded the matter to the High Court to specifically address the maintainability and merits of the application to convert an Arbitration Act petition into a civil suit via amendment, as the High Court had omitted to deal with this aspect in its judgment (!) .
Procedural History: The case involved a contractor (M/s. Pioneer Builders) who initially filed a petition under Sections 8 and 20 of the Arbitration Act, which was later amended to be treated as a civil suit, leading to disputes over Section 80 notice requirements and the validity of the amendment (!) (!) (!) (!) .

JUDGMENT

D.K. Jain, J.—These four cross appeals, by special leave, are directed against two judgments and orders, both dated 3.3.1999, rendered by the High Court of Judicature Andhra Pradesh at Hyderabad in Appeals No.2206-2207 of 1996 and 236-237 of 1998. The State of Andhra Pradesh, the first defendant in the suit and plaintiff, namely, M/s. Pioneer Builders, Engineers and Contractors, Hyderabad, hereinafter referred to as "the contractor" are the appellants before us. Since the factual matrix and the questions of law involved in all the appeals are common, these are being disposed of by this judgment. However, we shall refer to the facts of Civil Appeal No.6115/1999 as illustrative.

2. Sometime in the year 1988, the Superintending Engineer, Srisailam Right Branch Canal (for short "SRBC"), defendant No.2 in the Suit, issued notice inviting tenders from pre-qualified bidders of eligible source countries, which included India, for the work of excavation, lining and construction of structures of SRBC. It was a time bound project supported by credit loans from the International Development Association and International Bank for Reconstruction and Development.

3. The tender of the contractor being the lowest, he was awarded the work valued at Rs.8,42,93,617/-. A formal agreement was executed. Time for completion of the work was thirty six months from the date of handing over of the site. Clause 57 of General Conditions of Contract laid down the procedure for resolution of disputes. It reads thus:

"57. RESOLUTION OF DISPUTES:

1) Settlement of claims for Rs.50,000/- and below by Arbitration.

All disputes or differences in respect of which the decision, if any, of the Engineer or Employer has not become final and binding as aforesaid, shall on the initiative of either party in dispute be referred to the adjudication as follows:

a)Claims upto a valueSuperintending of Rs. 10,000/-Engineer S.R.B.C. Circle No.IIIBanganapalli at Nandyal

b)Claims above Rs.Chief Engineer,10,000/- & uptoMajor Irrigation,Rs.50,000/-Hyderabad

The arbitration shall be conducted in accordance with the provisions of Indian Arbitration Act of 1940 or any statutory modifications thereof.

2.Settlement of claims above Rs.50,000/-

All claims of above Rs.50,000/- are to be settled by a court of competent jurisdiction by way of Civil Suit."

4. It seems that only 50 of the allotted work could be completed by the due date. Apprehending expulsion, on 24.3.1992, the contractor filed a petition under Sections 8 and 20 of the Indian Arbitration Act, 1940 read with Section 26 and Order VII Rule 1 of the Code of Civil Procedure (for short "C.P.C"), registered as an original suit, with the following prayers:

"(a)Arbitrate the disputes mentioned in para 17 arising between the plaintiff and defendant under clauses 56 and 57 of section 2, vol.I of the contract and also direct the defendants to pay to the plaintiff the amount so determined as payable.

(b)Or in alternative to direct the defendants to file the agreement before the Honble Court and appoint a sole arbitrator for adjudicating the said disputes referred to in paragraph 17 arising between the plaintiff and defendants under the Arbitration Act, 1940.

(c)Payment of interest on the amount payable to the plaintiff at the rate of 21 per annum from the date of execution of work till payment.

(d)Costs."

5. On 26.3.1992 defendant No.2 issued notice to the contractor expelling them from the contract on the ground that they had failed to maintain the rate of progress as per the approved programme. On 13.4.1992, the contractor filed an application seeking interim injunction, restraining the defendants from encashing the bank guarantees for an amount of Rs.1,26,00,000/-, furnished by them towards mobilization advance and as performance guarantee. The suit was resisted by the defendants mainly on merits though it was averred that "the plaintiff suit is not maintainable either in law or on facts". No separate reply to the application appears t

Click Here to Read the rest of this document

2006 Supreme(SC) 896

IMPORTANT POINTDominant object to allow amendment in pleadings liberally is to avoid multiplicity of proceedings but one distinct cause of action could not be substituted for another nor subject matter of suit could be changed.

Cases Referred (10)

IMPORTANT POINT
Dominant object to allow amendment in pleadings liberally is to avoid multiplicity of proceedings but one distinct cause of action could not be substituted for another nor subject matter of suit could be changed.