Chairman, Tamil Nadu Housing Board, Madras v. T.N. Ganapathy
SHARMA, J. This appeal by special leave arises out of a suit
filed by the respondent in representative capacity for permanent
injunction against the appellant Tamil Nadu Housing Board from
demanding and collecting from the allottees any additional amount for
settlement of lands with buildings in the colony Ashok Nagar fully
des~ribed in the plaint. F
2. In pursuance of a Housing Scheme the. appellant-Board pro
ceeded to settle a large number of residential plots to different groups
of applicants including one described as low-income group. A number
of allottees, including the plaintiff-respondent, were selected and set
tlement in their favour was made in 1963. J,.. oopy of the document G
executed separately in respect to the plots is on the record of this case
as Exh. B-3, setting out the terms and conditions of the lease. The
term as mentioned in the 15th clause, which is quoted below, has been
referred to by the parties in support of their respective cases:
"15. The Lessor agrees to sell the property more particu- H
274 SUPREME COURT REPORTS [1990) 1 S.C.R.
larly described in the schedule hereunder to the Lessee for
such price as the Administrative Officer of the Lessor may
at any time in his sole discretion fix, and at which time the
Administrative Officer of the Lessor is entitled to consider
details regarding development charges, cost of amenities,
cost of buildings, etc., and whether the price of the land
acquired under the Land Acquisition Act together with
suitable modifications thereto by the local laws has become
final by a conclusive adjudication thereon by the concerned
Tribunals and Courts. The final decision of the Administra
tive Officer of the Lessor. as to the final price of the pro
perty as determined under these presents is conclusive and
binding on the Lessee and the Lessee agrees to purchase
the property from the Lessor at the said price on the terms
and conditions hereinafter mentioned.
Excepting the fixation of price with reference to the
claim or compensation adjudicated or awarded by courts
finally and conclusively with regard to the lands acquired
under the scheme, the Lessor shall fix the price of the
property after taking into consideration the development
charges, cost of amenities and buildings etc .. within a
period of three years from the date of allotment and which
price is subject only to a revision on account of excess
compensation if any awarded by courts for the lands as
aforesaid.··
Tentative' price for the property was fixed, subject to a final deter
mination within a stipulated period under the agreement and the allot
tees occupied the properties on that basis. After a lapse of more than a
decade fresh demands were made in 1975 threatening dispossession in
case of non-payment, which led to the filing of the suit. It is stated in
the plaint that the cases of all the allottees in low-income group of
Ashok N agar made under the lease deeds are identical and the plaintiff
was representing them in asking for permanent injunction restraining
the Board from enforcing the belated supplementary demands.
3. Besides, objecting to the maintainability of the suit, the
defendant-Board pleaded that it was entitled in law to finally deter-
mine the correct price for the settlement of the properties even )
belatedly, and the challenged demands were perfectly valid. It was
stated that the land for the scheme had been acquired under the provi-
H sions of the Land Acquisition Act, and until the final award of the
HOUSING BOARD v. T.N. GANAPATHY [SHARMA, J.] 275·
compensation for the acquired lands was made, the value of the lands . A
.I_ was not capable of being ascertained. The trial court overruled the
'· technical pleas, but, dismissed the suit on merits. The first appellate
court confirmed the decree.
\
(
4. The plaintiff filed a second appeal to the Madras High Court,
and the Housing Board a cross-objection against t.he adverse findings. ·B
The High Court while confirming the maintainability of the suit
reversed the finding on merits and passed a decree. The impugned·
demand included the excess compensation awarded by courts for
acquisition of the land as also the development charges, cost of
amenities and buildings, etc., without splitting up the two demands.
The High Court held tha.t it was open to the Board to determine within
a reasonable time what portion of the additional demand represented C
the excess compensation awarded for the lands and to take steps for its
realisation after service of a demand notice on the allottee, but,
granted a decree for injunction in regard to the entire demand at the
present stage as the two amounts have not been separately mentioned.
5. The learned counsel for the appellant has pressed two points
in support of the appeal, namely, the decision of the High Court on the
merits of the dispute is erroneous and that the provisions of Order I,
Rule 8 of the Code of Civil Procedure in any event are not applicable to
the case and the suit, as a representative suit, is not maintainable.
6. The second paragraph of clause 15 of the lease deed explicitly
directs the Board to assess the final amount on account of the develop·
ment charges, cost of amenities and buildings, etc. within a period of
three years from the date of the allotment, and there does not appear
to be any reason for constr11ing the provisions differently. The High
Court at considerable length considered this aspect, pointing out the F
unexplained long delay of about a decade after completion of the
constructions, etc. on the part of the Board. There was no difficulty at
all in making the final calculation in time, and taking steps for recovery
of the same. We entirely agree with the view of the High Court. The
Court was also right in permitting the Board to make a fresh additional
demand in regard to the enhancement in the compensation for the G
acquired lands and the respondents do not have any objection to that
part.
7. On the question of maintainability of the suit in a representa
tive capacity under Order 1, Rule 8 of the Code of Civil Procedure, it
has been contended that since the injury complained of is in regard to H
.o
demand of money and that too by a separate demand against each of
lhe allottees, giving rise to different causes of action, the Rule 1 has
no application. The learned counsel proceeded to say that it is not
known whether each of the allottees in Ashok Nagar had been even
served with an additional demand before the suit was filed; and further
emphasised that those who had been so served are interested in defeat
ing only the demand individually referable to each of them. Each one
of them is not interested in what happens to the others. It is, therefore,
suggested that only such of the allottees who have already been served
with additional demands are entitled to maintain an action in court,
and they also should do it by filing separate suits. We do not find any
merit in the argument. The provisions of Order l of Rule 8 have been
i.ncluded in the Code in the public interest so as to avoid multiplicity of
lillgation. The condition necessary for application of the provisions is
that the persons on whose behalf the suit is being brought must have
the same interest. In other words either the interest must be common
or they must have a common grievances which they seek to get redres
sed. In Kvdia Goundar and Another v. Ve/andi Goundar and others,
lLR 1955 Madras 339, a Full Bench of the Madras High Court
observed that on the plain language of Order. 1, Rule 8, the principal
requirement to bring a suit within that Rule is the sameness of interest
of the numerous persons on whose behalf or for whose benefit the suit
is instituted. The Court, while considering whether leave under the
Rule should be granted or not, should examine whether there is suffi
cient community of inte.rest to justify the adoption of the procedure
provided under the .. Rule. The object for which this provision is enac
ted is really to facilitate the decision of questions, in which a large
number of persons are interested, without recourse to the ordinary
procedure. The provision must, therefore, receive an interpretation
which will subserve the object for its enactment. There are no words in
the Rule to limit its scope to any particular category of suits or to
exclude a suit in regard to a claim for money or for in junction as the
present one.
8. Coming to the relevant circumstances in the present case it
will be seen that all the allotments in Ashok Nagar were made under
G the same Scheme and all the relevant facts are common. The basis of
the impugned demand of the appellant is equally applicable to all the
allottees and the plea of the plaintiff is available to all of them. The
trial court was, therefore, perfectly right in permitting the plaintiff to
proceed under Order 1, Rule 8 of the Code of Civil Procedure.
Nobody in this situation can complain of any inconvenience or
H . injustice. On the other hand, the appellant is being saved from being
'
' ,
J
{
HOUSING BOARD v. T.N. GANAPATHY [SHARMA, J.] 277
involved in unnecessary repeated litigation. A
9. It is true that each of the allottees is interested individually in
fighting out the demand separately made or going to be made on him
and, thus, separate causes of action arise in the case, but, that does
not make Order 1, Rule 8 inapplicable. Earlier there was some doubt B
about the Rule covering such a case which now stands clarified by the
Explanation introduced by the Code of Civil Procedure (Amendment)
Act, 1976, which reads as follows: ·
"Explanation-For the purpose of determining whether
the persons who sue or are sued, or defend, have the same
interest in one suit, it is not necessary to establish that such C
persons have the same cause of action as the persons on
whose behalf, or for whose benefit, they sue or are sued, or
defend the suit, as the case may be."
The objects and reasons for the amendment were stated below: D
"OBJECTS AND REASONS: Clause 55; sub-clause
(iv),-Rule 8 of Order l deals with representative suits.
Under this rule, where there are numerous persons having
the same interest in one suit, one or more of them may,
with the permission of the Court, sue or be sued, on behalf E
of all of them. The rule has created a doubt as to whether
the party representing others should have the same cause
of action as the persons represented by him. The rule is
being substituted by a new rule and an explanation is being
added to clarify that such persons need not have the same
cause of action." ·
There is, therefore, no doubt that the persons who may be represented
in a suit under Order I, Rule 8 need not have the same cause of action.
The trial court in the present case was tight in permitting the respondem
to sue on behalf of all the allottees of Ashok Nagar. We, therefore. do
not find any merit in this appeal which is dismissed with costs. Before G
closing, however, we would like to point out that the plaintiff has
represented only those in the low income group in Ashok Nagar who
will be governed by this judgment, and nothing what has been said or
decided in this case is applicable to any other group or colony.
R.N.J. Appeal dismissed. H