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CASE NO.: Appeal (civil)  2946 of 2007

PETITIONER: Andhra Bank

RESPONDENT: ABN Amro Bank N.V. and Ors

DATE OF JUDGMENT: 10/07/2007

BENCH: Tarun Chatterjee & Markandey Katju

JUDGMENT: J U D G M E N T

CIVIL APPEAL NO.2946 OF 2007 [Arising out of SLP [C] No.10844 of 2007] W I T H CIVIL APPEAL NO. 2947 OF 2007 [ Arising out of SLP [C] No.10845 of 2007

TARUN CHATTERJEE,

C.A.NO. 2946 OF 2007 [@ S.L.P.)No.10844 of 2007]

1.      Leave granted. 2.      This appeal is directed against the order dated 13th April,  2007 passed by the Special Court {Trial of Offences relating to  Transactions in Securities} at Bombay in Chamber Summons  No.1 of 2007 in Suit No.3 of 1998 for recovery of  Rs.15,66,66,591/- with other incidental reliefs by which the  application for amendment of the written statement filed at the  instance of the appellant was rejected.   3.      Initially the suit was filed in the High Court of Delhi and  was later transferred to the Special Court at Bombay constituted  under the Special Court {Trial of Offences relating to  Transactions in Securities} Act 1992 where the suit is now  pending decision.  It has been alleged in the plaint by the  respondent ABN  Amro Bank that on 3rd March, 1992, the New  Delhi Branch of the bank had ordered transfer of one lac  numbers of 17% NPC Bonds of Rs.100/- from respondent No.2  at a price of Rs.97/- .  It has been the further case of the ABM  Amro bank in the plaint that the appellant had failed to deliver  to the respondent bank the NPV bonds and instead on or about  18th March, 1992 respondent no.2 delivered to ABN Amro  Bank the original letter of allotment No.0016 covering one lac  9% tax free IRFC bonds of the value of Rs.10 crores endorsed  in blank along with contract note dated 9th March, 1992.   Accordingly, the ABN Amro Bank has prayed for a decree for  the amount mentioned hereinabove and for other incidental  reliefs.   In the written statement the appellant clearly denied the  allegations made by the Bank.  It is true long thereafter an  application for amendment of the written statement was filed by  the appellant in which the appellant sought to amend para 7 of  the written statement by inserting a new para, namely, para 7A  which is as follows: "Defendant No.1 says that the plaintiffs have  admittedly agreed to purchase the said NPC bonds as  also the said IRFC bonds as also allegedly paid the  purchase price of the said bonds for and on behalf of  their principal viz. the said Punjab Housing

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Development Board who is a disclosed principal.   Defendant No.1 says and submits that the suit has  been filed to enforce the said alleged agreement viz  for recovery of the purchase price of the said NPC  bonds by the plaintiff in its personal capacity.   Defendant No.1 says and submits that the plaintiff  cannot personally enforce the said alleged agreement  entered into by the plaintiff on behalf of its principal.   In the circumstances defendant No.1 submits that the  suit is not maintainable and is liable to be dismissed  with costs."

4.      As noted herein earlier it is this prayer for amendment of  the written statement which was rejected by the Special Court  by the impugned order which is now under challenge in this  appeal by special leave. 5.      We have heard Mr. Rohit Kapadia, learned senior  counsel appearing for the appellant and Mr. S. Ganesh, learned  senior counsel for the respondent.  We have perused the  original written statement as well as the application for  amendment of the written statement.  After going through the  written statement and the application for amendment of the  written statement, we are of the view that the amendment  sought to be introduced by the appellant must be allowed.   From a perusal of the impugned order of the Special Court we  find basically that two grounds have been taken by the Special  Court for rejecting the prayer for amendment of the written  statement.  The first ground is that considerable delay has been  caused by the appellant in filing the application for amendment  of the written statement.  It is well settled that delay is no  ground for refusal of prayer for amendment.  Mr. Ganesh,  appearing for ABN Amro Bank submits before us that by filing  of such an application for amendment of the written statement  which has been filed with long delay, the appellant sought to  stall the hearing of the suit which has been fixed on 13th July,  2007.  In response to this Mr. Kapadia, learned counsel for the  appellant, submits that in the event the prayer for amendment is  allowed by us his client undertakes to file the amended written  statement by day after tomorrow, i.e., 12th July, 2007 before the  Special Court.  Since, we are of the view that delay is no  ground for not allowing the prayer for amendment of the  written statement and in view of the submissions made by Mr.  Kapadia, we do not think that delay in filing the application for  amendment of the written statement can stand in the way of  allowing the prayer for amendment of the written statement.  So  far as the second ground is concerned, we are also of the view  that while allowing an application for amendment of the  pleadings, the Court cannot go into the question of merit of  such amendment.  The only question at the time of considering  the amendment of the pleadings would be whether such  amendment would be necessary for decision of the real  controversy between the parties in the suit.  From a perusal of  the amendment application we find that the appellant in their  prayer for amendment has only taken an additional defence that  in view of Section 230 of the Indian Contract Act, the suit itself  is not maintainable.  It is well settled, as noted herein earlier,  that at the time of considering the prayer for amendment of the  written statement it would not be open to the Court to go into  the fact whether in fact the suit in view of Section 230 of the  Indian Contract Act was or is not maintainable.   6.      That apart it is permissible in law to amend a written  statement of the defendant by which only an additional ground  of defence has been taken.                                                 7.      In view of the reasons stated herein above we are of the  view that the order of the Special Court rejecting the application

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for amendment of the written statement filed by the appellant is  liable to be set aside and the prayer for amendment of the  written statement must be allowed.  Accordingly, the  application for amendment of the written statement is allowed  and the impugned order is set aside.  We are informed by the  learned counsel for the parties appearing before us, as noted  herein earlier, that the suit has been fixed for hearing on 13th  July, 2007 and the parties will not seek any adjournment on that  date.  In that view of the matter we direct the appellant to file  the amended written statement by 12th July, 2007 positively and  thereafter the Special Court shall proceed with the hearing of  the suit.  The appeal is allowed to the extent indicated above.   There will be no order as to costs.

C.A. No. 2947 of 2007 {Arising out of SLP 10845/2007]          1.      Leave granted.   2.      This appeal is directed against the order dated 4th May,  2007 passed by the Special Court {Trial of Offences relating to  Transactions in Securities} at Bombay in Chamber Summons  No.2 of 2007 in Suit No.3 of 1998 by which the Special Court  has rejected the chambers summons taken out by the appellant  as it was of the view that the most of the submissions made in  the affidavit were also to be found in the plaint. 3.      The question that arose in this appeal is whether an  application of the appellant in a suit for tendering in evidence  an affidavit in chief of the plaintiff containing statements which  are relevant and germane to the issues involved in the suit can  be rejected only on the ground that the affidavit does not  contain any admission.  As noted herein earlier the suit which  has been filed by ABN Amro,Bank is a suit for recovery of  Rs.15,66,66,591/- and for other incidental reliefs.  In the suit  the appellant has filed a written statement in which the  appellant has clearly denied the allegations made by   respondent No.1.  It has further been clearly stated in the  written statement that there was no privity of contract between  the appellant and respondent no.1 and no transaction was even  entered into between them.  Although, the Special Court by an  order dated 13th April, 2007 rejected the prayer for amendment  of the written statement made by the appellant but by our order  of this date in C.A.No.2946 of 2007 arising out of SLP  No.10844/2007, the prayer for amendment of the written  statement has been allowed by us.  Chamber Summons No.2 of  2007 arising out of suit No.3 of 1998 was filed seeking  permission to tender in evidence the affidavit of examination in  chief of Suhail Chander .  This application was rejected by the  Special Court  in respect of which this appeal by special leave  has been filed. 4.      We have heard learned counsel for the parties and on  consideration of the material on record, we are of the view that  the Special Court has acted illegally and with material  irregularity in the exercise of its jurisdiction in passing the  impugned order.  In the facts and circumstances of the present  case and also after considering the affidavit filed by the  appellant, we are of the view that such a prayer of the appellant  to tender in evidence of certain paragraph and affidavit in  examination in chief of the appellant containing statements are  relevant and germane to the issues involved in the suit and,  therefore, cannot be rejected only on the ground that the same  did not contain any admission.  Accordingly, we set aside the  impugned order and allow the appeal. 5.      As noted herein earlier, we are informed by the learned  counsel for the parties that the suit has been kept for hearing on  13th July, 2007 and in this view of the matter, we request the  Special Court to go on with the hearing of the suit from 13th

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July, 2007, as directed in C.A.No.2946 of 2007 arising out of  SLP 10844/2007.  6.      We make it clear that we have not gone into the merits of  the suit or the amendment incorporated in the written statement.   All such questions shall be taken into consideration by the  Special Court at the time of disposal of the suit. 7.      The appeal is allowed to the extend indicated above.   There will be no order as to costs.