SH. SHIEKH ANWAR ELAHI vs SH. MOHD. NOWSHAH & ORS

* IN THE HIGH COURT OF DELHI AT NEW DELHI

% Date of Decision: 04/10/2023

+ CS(OS) 273/2017

IN THE MATTER OF:

SH. SHIEKH ANWAR ELAHI ….. Plaintiff
Through: Mr. Ashish Dholakia, Sr. Advocate with Mr. Aditya Singh, Ms. Mehak Nakra and Mr. Arpit Kumar Singh, Advocates
versus

SH. MOHD. NOWSHAH & ORS ….. Defendants
Through: Mr. J.P. Sengh, Sr. Advocate with Ms. Gurkamal Hora Arora and Mr. Jaiswal Baath, Advocates for defendant Nos.1 and 3.
Mr. Sumant Narang, Advocate for defendant No.2.
CORAM:
HON’BLE MR. JUSTICE MANOJ KUMAR OHRI
JUDGMENT (ORAL)

I.A. 4058/2022
1. The captioned application has been preferred by defendant Nos.1 and 3 under Order VI Rule 17 read with Section 151 CPC thereby seeking to amend the written statement filed by them.
2. Before proceeding further, it is deemed apposite to note that the plaintiff has preferred the present suit for partition of the suit property thereby declaring plaintiff and defendant Nos.1 and 2 as equal owners. The plaintiff has claimed that plaintiff and defendant Nos.1 and 2 are real brothers being sons of Late Sh. Sheikh Maroof Elahi. Defendant No.3 is a company wherein besides the present parties, Gayassudin another real brother of the parties, is also a director and shareholder.
3. It has been further claimed that the plaintiff and defendants had entered into a Partnership Deed on 02.11.1963 under the name and style of M/s United Brothers to carry on the business of manufacture and sale of aluminium wares including manufacture and sale of pressure cooker under the mark ‘United’.
4. Disputes arose between the parties leading to the filing of the present suit. The parties claim to be the absolute owner in equal share of the suit property, claiming to have purchased the same from its erstwhile owner on 27.01.1995. Defendant No. 3 is stated to have been in permissive possession of the suit property since 1995.
5. On being served with the summons in the present suit, defendant Nos.1 and 3 had filed a written statement.
6. The captioned application is filed by defendant Nos.1 and 3 on the premise that at the time of purchase of the suit property from its erstwhile owner Sh. Hem Chand, the plaintiff backed out from the sale transaction at the last moment and did not sign the sale agreement. The sale consideration of Rs.7.10 lacs was paid in equal shares by plaintiff and defendant No.1 with the understanding that defendant No.1 shall refund plaintiff’s share of sale consideration. On being approached by the plaintiff, defendant No.1, under an oral agreement arrived at in September, 2011, agreed to transfer the shareholding of his daughter-in-law namely Ms. Shazia Rehman in United (India) Metal Forming Pvt. Ltd. which was equivalent to the 50% share of the sale consideration, in favour of the plaintiff. Defendant No.1 claims that at the time of filing of the written statement, he was given the impression by plaintiff and defendant No.2 (father of Ms. Shazia Rehman) that in consequence of the above oral understanding, 4456 shares of Ms. Shazia Rehman had been transferred in favour of the plaintiff. Defendant No. 1 further claims that in the year 2011 he was diagnosed with cataract in the left eye and glaucoma in the right eye. As he was unable to read and write, he on asking of the plaintiff, signed in good faith on the balance sheet and annual returns filed on behalf of United (India) Metal Forming Pvt. Ltd. It is only when Ms. Shazia Rehman filed a civil suit being CS(COMM.) 245/2019, that he came to know that Ms. Shazia Rehman had denied the share transfer or execution of any transfer deed in respect of her 4456 shares in favour of the plaintiff. Besides above, during the cross-examination of the plaintiff by defendant No.2, he had also produced a notice dated 05.04.2019 issued on behalf of Ms. Shazia Rehman wherein she had claimed the ownership of the said shares. On becoming aware of the categorical stand of Ms. Shazia Rehman with respect to aforesaid 4456 shares, defendant Nos.1 and 3 seek to amend the written statement. In support of their submissions, they have placed reliance on the decision in Baldev Singh & Ors. v. Manohar Singh & Anr.1
7. Plaintiff has vehemently opposed the application. It is contended that despite admitting knowledge since at least 2019, present application has been filed after a delay of three years. In the present case, the trial has commenced and both the plaintiff and defendant No.2 have been cross-examined. The defendant Nos.1 and 3 have not only failed to show any due diligence on their part but also failed to explain the delay. The transfer of 4456 shares of Ms. Shazia Rehman in favour of the plaintiff was duly recorded in the Register of Members which was duly counter signed by the plaintiff. Besides, defendant No.1 by his own admission as well as averments made in the plaint in CS(COMM.) 245/2019 was aware of the stand taken by Ms. Shazia Rehman. Lastly, it was contended that the amendment now sought to be carried out by the applicants is actuated by a mala fide intent to help Ms. Shazia Rehman in the aforesaid suit. The amendment would further affect plaintiff’s vested rights on account of applicants’ admission in their unamended written statement.
8. Defendant No.2 has supported the plaintiff in opposing the application. It is contended that the entire premise that knowledge was alleged to have been acquired by the defendant No.1 in the year 2019, does not stand to reason as Ms. Shazia Rehman being daughter-in-law of defendant No.1 lives in the same house.
9. The legal position in the context of an application under Order VI Rule 17 CPC seeking amendment of pleadings is well settled. The Court is liberal while entertaining such an application unless the same is likely to cause serious injustice or irreparable loss to the other side. Further, proviso to the aforesaid Rule puts an additional rider in cases where the trial has commenced wherein the party seeking amendment has to establish that it had acted with due diligence. The object for bringing in the proviso was to avoid surprises as the parties had become aware of the pleas and stand taken by the other side. The only exception carved out is that the party making the application could not have raised such a plea despite due diligence. The word due diligence, though not defined in the Code, its meaning as appearing in Oxford & Black’s Law Dictionary was noted by the Apex Court in Chander Kanta Bansal v. Rajinder Singh Anand2, a decision referred to by the defendants. The relevant extract reads as under:-
“16… According to Oxford Dictionary (Edn. 2006), the word “diligence” means careful and persistent application or effort. “Diligent” means careful and steady in application to one’s work and duties, showing care and effort. As per Black’s Law Dictionary (18th Edn.), “diligence” means a continual effort to accomplish something, care; caution; the attention and care required from a person in a given situation. “Due diligence” means the diligence reasonably expected from, and ordinarily exercised by a person who seeks to satisfy a legal requirement or to discharge an obligation. According to Words and Phrases by Drain-Dyspnea (Permanent Edn. 13-A) “due diligence”, in law, means doing everything reasonable, not everything possible. “Due diligence” means reasonable diligence; it means such diligence as a prudent man would exercise in the conduct of his own affairs.

17. It is clear that unless the party takes prompt steps, mere action cannot be accepted and file a petition after the commencement of trial. As mentioned earlier, in the case on hand, the application itself came to be filed only after 18 years and till the death of her first son Sunit Gupta, Chartered Accountant, had not taken any step about the so-called agreement. Even after his death in the year 1998, the petition was filed only in 2004. The explanation offered by the defendant cannot be accepted since she did not mention anything when she was examined as witness.”

10. The Apex Court further took note of the decision in Union of India v. Pramod Gupta (Dead) by LRs and Ors.3, wherein the Court had cautioned that delay and latches on part of the parties to the proceedings would also be a relevant factor while considering an application seeking amendment of pleadings.
11. Coming back to the present case, a perusal of the annual returns and the Register of Members maintained by United (India) Metal Forming Pvt. Ltd., copy of which has been placed on record, evidences transfer of 4456 shares from Ms. Shazia Rehman to the plaintiff in September, 2011. The said documents bear signatures of defendant No.1 which are not denied. The only explanation tendered by defendant No.1 was that the signatures were put without reading the documents on account of his medical condition. It is borne out from the records that prior to filing of the suit by Ms. Shazia Rehman, defendant No.1 had also preferred a company petition bearing No.91(ND)/2016 under Section 241/242/210/213 of the Companies Act, 2013 before NCLT, New Delhi. Even in the said petition, the shareholding pattern as on 31.03.2015 reflected transfer of shares of Ms. Shazia Rehman in favour of the plaintiff. In the said petition, defendant No.1 had taken a stand that in the year 2013 he was unwell and day-to-day affairs were looked after by plaintiff and defendant No.2. In the present case, while cross-examining the plaintiff, a question was put to him on behalf of defendant No.1 that 4456 shares of Ms. Shazia Rehman were transferred to the plaintiff as part of an oral agreement. A similar question was put to PW3-Sh.Ameeruddin.
12. In the aforesaid backdrop, the explanation tendered by defendant No.1 for filing the present application that the same was necessitated due to the suit filed by Ms. Shazia Rehman, does not inspire confidence. As noted above, the evidence of both plaintiff and defendant No.2 has been closed. In this circumstance, defendant No.1 has failed to establish that due diligence was carried out before filing of the written statement. Ms. Shazia Rehman is none other than the daughter-in-law of defendant No.1 living in the same house.
13. There is also no explanation as to why the applicants waited for three years to file the captioned application even if in arguendo, it is assumed that they became aware only in the year 2019 upon the filing of suit by Ms. Shazia Rehman.
14. For the aforesaid reasons, this Court is of the opinion that the applicants have failed to satisfy the parameters in terms of proviso to Rule 17 of Order VI.
15. The application is accordingly dismissed.
CS(OS) 273/2017
1. List before Local Commissioner on 21.11.2023.
2. List before Joint Registrar (Judicial) on 23.01.2024 to supervise the recording of evidence before the Local Commissioner.

(MANOJ KUMAR OHRI)
JUDGE
OCTOBER 4, 2023
ga

1 (2006) 6 SCC 498
2 (2008) 5 SCC 117
3 (2005) 12 SCC 1
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