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2009 Supreme(Raj) 348
[Citation : 2009(3) RLW 2707 (Raj.)]
(Rajasthan High Court)
Jaipur Bench
Gupta Plastics Pvt. Ltd. Vs. Firm Amrish Plastics (Jain, J.)
HON'BLE NARENDRA KUMAR JAIN, J.
Gupta Plastics Private Limited (M/s.)
Versus
Firm Amrish Plastics
S.B. Civil Regular First Appeal No. 125 of 1994, decided on 03.03.2009
Amit Gupta, Advocate, for Bihari Lal Agarwal, for Appellant;
None present for Respondent
Headnote:C.P.C., Sec. 96 — First appeal — Suit for recovery of money — Suit dismissed by trial Court on the ground that `R the Director of the Company was not authorised to institute the suit — Director was authorised to institute the suit and also competent to sign and verify the pleadings — Held — Under Art. 17 Directors were given powers to institute the suit — Trial Court committed illegality in dismissing the suit — Suit is decreed against the defendant, with interest @ 6% per annum from the date of filing of the suit till the date of realization.
Appeal allowed. (Paras 16, 18 & 19)
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vihy Lohdkj dhA ¼in la[;k 16] 18 o 19½
Hon'ble JAIN, J.—Heard learned counsel for the appellant.
2. The only point involved in this appeal is as to whether Shri Ramawtar Gupta, one of the Directors of the plaintiff Company M/s Gupta Plastics Private Limited, was authorized to institute the present suit in the name and on behalf of plaintiff Company against the defendant in the trial court, or not? The trial court framed Issue No.4A in this regard and decided the same against the plaintiff-appellant. The trial court, while deciding other Issues in favour of the plaintiff, dismissed the plaintiff's suit on the basis of the finding on Issue No.4A.
3. The plaintiff-appellant filed a suit for recovery of a sum of Rs.2,05,600/- against the defendant-respondent in the trial court. The defendant contested the suit by filing a written-statement. The trial court framed five issues. Later on, Issue No.4A was also framed. The plaintiff examined PW-1 Ramawtar Gupta and produced documentary evidence. The defendant examined DW-1 Laxmi Niwas Bangur and DW-2 Damodar Lal Sharma. All the Issues, except Issue No.4A, were decided in favour of the plaintiff. Issue No.2, as to whether the plaintiff-company is entitled to recover a sum of Rs.2,05,600/-from the defendant, was decided in favour of the plaintiff. The issue No.3, as to whether the plaintiff is entitled only to receive Rs.30,000/-, was also decided against the defendant. The trial court, while deciding Issue No.4A, held that the plaintiff is a registered Company and Ramawtar Gupta is its one of the Directors but a resolution of Company authorizing him to institute the present suit has not been filed, therefore, the trial court, on the basis of the judgment of the Delhi High court in M/s. Nibro Limited vs. National Insurance Company Limited - AIR 1991 Delhi 25, decided the said Issue against the plaintiff and, on the basis of the finding on Issue No.4A, dismissed the plaintiff's suit vide impugned judgment and decree dated 21st May, 1994.
4. The learned counsel for the appellant contended that the trial court committed an illegality in deciding Issue No.4A against the plaintiff. He contended that Ramawtar Gupta was Director of plaintiff Company and he was authorized by Memorandum and Articles of Association of the Company itself to institute legal proceedings in the name and on behalf of the plaintiff Company therefore there was no need of separate resolution by Board of Directors to institute the present suit on behalf of the plaintiff Company. In support of his submission, he referred Memorandum of Association (Exhibit-2) and Order 29 Rules 1 and 2 of the CPC as well as the decision in United Bank of India vs. Naresh Kumar and Others - 1996 (6) SCC 660. He also contended that the trial court committed an illegality in relying upon the judgment of the Delhi High court in M/s Nibro Limited vs. National Insurance Company Limited (Supra), as the said judgment was distinguishable and not applicable in the present case for the reason that in the case before the Delhi High Court the Memorandum and Article of Association of the Company were not placed on the record whereas in the present case the Memorandum and Articles of Association of the plaintiff Company was placed on the record and got the same exhibited and marked as Exhibit-2, wherein the Director of the Company was specifically authorized to institute, conduct, defend, compound or abandon any legal proceedings by or against the Company; he also referred the decision in Jaipur Udyog vs. Union of India – AIR 1972 Rajasthan 129 = 1972 RLW 241. He, therefore, submitted that the finding of the trial court on Issue No.4A may be set-aside and, in view of the finding of the trial court in respect of Issues No.2 and 3, the plaintiff's suit be decreed.
5. No one is present on behalf of the respondent despite service of notice and, as such, there is no assistance available on behalf of the respondent.
6. I have considered the submissions of the learned counsel for the appellant and
