Impleadment, amendment, and foreign forum clauses cannot displace territorial jurisdiction or justify a wider, multifarious suit.
Impleadment that would introduce a new and independent cause of action, widen an injunction suit, or create misjoinder and multifariousness was refused, and leave under Section 80(2) CPC was not justified absent urgent relief against the Central Government. Amendment to add foreign companies and a fresh declaratory prayer concerning a share sale and guarantee was also declined because the proposed parties were neither necessary nor proper and the new relief was vague and unnecessary. Territorial jurisdiction remained with the Indian court where the defendant bank carried on business in Delhi; a foreign forum clause did not oust that jurisdiction. The bankruptcy objection likewise failed for want of any conclusive insolvency adjudication.
Issues: (i) Whether the plaintiff could add the Union of India and the Reserve Bank of India as parties and seek leave under Section 80(2) of the Code of Civil Procedure, 1908. (ii) Whether the plaintiff could amend the plaint to add foreign companies and a new declaratory relief concerning the share sale and guarantee. (iii) Whether the objections to the suit based on jurisdiction, forum selection, and the plaintiff's alleged bankruptcy defeated the pending applications.
Issue (i): Whether the plaintiff could add the Union of India and the Reserve Bank of India as parties and seek leave under Section 80(2) of the Code of Civil Procedure, 1908.
Analysis: The proposed impleadment of the Union of India and the Reserve Bank of India introduced a new and independent cause of action unrelated to the existing suit for injunction. No relief was claimed against either proposed party in relation to the challenged transaction. The Court held that such impleadment would widen the scope of the suit impermissibly, create misjoinder of causes of action and parties, and result in multifariousness. It also found no basis to invoke the discretion under Section 80(2), since no urgent relief was shown against the Central Government.
Conclusion: The request to add the Union of India and the Reserve Bank of India was refused, and the application was dismissed.
Issue (ii): Whether the plaintiff could amend the plaint to add foreign companies and a new declaratory relief concerning the share sale and guarantee.
Analysis: The foreign companies sought to be added had no pleaded cause of action arising in India, carried on no business in Delhi or elsewhere in India, and were connected with transactions that had taken place outside India. The Court held that they were neither necessary nor proper parties, and that their addition would cause hardship and unnecessary expense. The new declaratory prayer was found to be too vague, unnecessary for adjudication of the original controversy, and incapable of being granted in the absence of the other parties to the transaction. It was also treated as bad for multifariousness. The Court left open the possibility of separate amendments limited to additional facts, if otherwise permissible under Order 6, Rule 17.
Conclusion: The request to add the foreign companies and the new declaratory relief was declined.
Issue (iii): Whether the objections to the suit based on jurisdiction, forum selection, and the plaintiff's alleged bankruptcy defeated the pending applications.
Analysis: The Court held that it had territorial jurisdiction because the defendant bank carried on business in Delhi. The contractual clause submitting disputes to English courts did not oust the jurisdiction of Indian courts under Section 20, and an agreement restricting recourse to Indian courts would be void under Section 28 of the Indian Contract Act, 1872 and opposed to public policy under Section 23. The plea that the plaintiff was an undischarged insolvent was not accepted, as no conclusive foreign judgment establishing the point was on record and no insolvency adjudication by any Indian court existed. The objection based on foreign proceedings therefore did not bar the applications.
Conclusion: The jurisdictional and bankruptcy objections failed.
Final Conclusion: The suit applications were not entertained on the merits sought by the plaintiff, and all pending applications stood dismissed.
Ratio Decidendi: A plaintiff cannot enlarge a suit by impleading unnecessary parties or introducing a new cause of action that creates misjoinder or multifariousness, and a contractual clause selecting a foreign forum cannot exclude the territorial jurisdiction of an Indian court where that jurisdiction otherwise exists.
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