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The Indian Evidence Act, 1872
Section 85 in The Indian Evidence Act, 1872
The Indian Penal Code
The Notaries Act, 1952
The Code Of Civil Procedure (Amendment) Act, 1956

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Delhi High Court
Baker Oil Tools (India) Pvt. Ltd. vs Baker Hughes Ltd. & Anr. on 3 June, 2011
Author: Kailash Gambhir
         IN THE HIGH COURT OF DELHI AT NEW DELHI

                          Judgment reserved on: 28.02.2011
                          Judgment delivered on: 03.06.2011


                          RFA No. 583/2004

Baker Oil Tools(India) Pvt.Ltd.                 ......Appellant.

            Through:      Mr. Chetan Sharma, Sr. Advocate with
                          Mr. Siddharth Mittal and Mr. Shashi
                          Mohan for the appellants.

                          Vs.

Baker Hughes Ltd.& Anr.                    ......Respondents

            Through:      Mr. Ajay Gupta, Sr. Advocate with
                          Ms.V. Mohini for the respondents.


                         AND


                              RFA No. 22/2005

Mr.Hiroo Khushalani                              ......Appellant.

            Through:      Mr. Chetan Sharma, Sr. Advocate with
                          Mr. Siddharth Mittal and Mr. Shashi
                          Mohan for the appellants.

                          Vs.

Baker Hughes Ltd., U.K. & Ors.                    ......Respondents

            Through:      Mr. Ajay Gupta, Sr. Advocate with
                          Ms.V. Mohini for the respondents.




           RFA No. 583/2004                     Page 1 of 71
 CORAM:
HON'BLE MR. JUSTICE KAILASH GAMBHIR

1. Whether the Reporters of local papers may
     be allowed to see the judgment?                           Yes

2. To be referred to Reporter or not?                          Yes

3. Whether the judgment should be reported                     Yes

     in the Digest?


KAILASH GAMBHIR, J.

*

1. This is an appeal filed under section 96 of the Code of Civil Procedure, 1908 to challenge the judgment and decree dated 16.9.2004 passed by the learned ADJ whereby the suits filed by the respondents herein for specific performance, permanent injunction and damages were decreed in favour of the respondents and against the appellants.

2. The short point involved for adjudication at this juncture is on the preliminary issue of maintainability of the suits and thus this judgment only deals with the said issue, without having any bearing on the merits of the matter.

3. Challenging the maintainability of the suits, Mr.Chetan Sharma, learned Senior counsel appearing for the appellants submitted that the trial court has wrongly decided the issue no.1 in RFA No. 583/2004 Page 2 of 71 favour of the respondents. Mr. Sharma further submitted that no Board Resolution was passed by the respondents so as to authorize any persons to execute the two Power of Attorneys and, therefore, Mr.Sameer Oberoi had no competence or authority to sign, file and verify the suits on behalf of the respondent/companies. Counsel for appellants further submitted that as per the settled legal position, a lawyer cannot act in dual capacity of being that of a constituted attorney of the party as well as an advocate in the same matter.

4. Counsel for appellants also submitted that the notarial certificate filed along with the two Power of Attorneys and proved on record by the respondents is vague due to blanks in the certificates and the notarial certificates also have no sanctity or validity in the eyes of law as the same were not authenticated by the Indian Consulate in terms of the provisions of Section 4 and 11 of the Notaries Act, 1952 read with Section 85 of the Indian Evidence Act, 1872.

5. Counsel also submitted that the constituted attorney Mr. Sameer Oberoi, who had signed and verified the plaint also did not enter the witness box to prove his Power of Attorney and also his signatures on the plaint. Mr. Chetan Sharma, learned counsel for the appellants further submitted that even PW1 Mr.Philip Jackson in RFA No. 583/2004 Page 3 of 71 his cross-examination candidly admitted the fact that there was no resolution or notation in the minute book authorizing any person to file the said suits or to give Power of Attorney in connection with the said suits. Counsel also submitted that even the evidence of PW-2 Mr.R. Sampath Kumar is also on the same lines as that of PW1. Counsel also submitted that Mr.R. Sampath Kumar deposed as a witness in the capacity of his being a partner in M/s Remfry and Sagar Solicitor Concern. Counsel also submitted that the Power of Attorneys filed on record by the respondents/plaintiffs were not sufficiently stamped as per the requirement of Indian Stamps Act, 1899. Counsel also submitted that even in the said Power of Attorneys, there is no reference to any Board Resolution through which the executants of Power of Attorneys could derive their authority. Counsel further submitted that the executants of the Power of Attorneys did not enter the witness box to prove the said Power of Attorneys. Counsel thus submitted that the executants of the Power of Attorneys had no legal competence to further give any authority to nominate or appoint any Advocate or Advocates on behalf of the respondent/companies. Counsel for the appellants further argued that the plea of dual capacity being a legal plea can always be raised at the stage of appeal as such a plea goes to the RFA No. 583/2004 Page 4 of 71 very root of the matter. Counsel for the appellants also submitted that the principle of constructive res judicata will not be attracted to the facts of the present case as the appellants are well within their right to challenge the findings of the learned trial court on any ground at the stage of appeal and the said vested right of the appellants cannot be defeated by the principle of constructive res judicata on the premise that no such plea to attack the maintainability of the said suits filed by the respondents was earlier taken by the appellants when the matter had travelled twice to the Hon‟ble Supreme Court at the interlocutory stage. In support of his arguments, counsel for the appellants placed reliance on the following judgments:

Konda Lakshmana Bapuji v. Govt. Of Andhra Pradesh AIR 2002 SC 1012Janki Vashdeo Bhojwani v. Indusind Bank Ltd. AIR 2005 SC 439  State of Punjab v. Bua Das Kaushani AIR 1971 SC 1676  Nedunuri Kameshwaramma v. Sampati Subba Rao AIR 1963 SC 884  Swamy Atmananda and Ors. V. Sri Ramakrishna Tapovanama & Ors. AIR 2005SC2392  Nibro Ltd. V. National Insurance co. Ltd. 41 (1990) DLT 633  M/s Rajgharia Paper Mills ltd. V. General Manager, Indian Security Press AIR 2000Delhi 239  Lucas Indian Services ltd. V. Sanjay Kumar Agarwal. 173(2010) DLT 438 RFA No. 583/2004 Page 5 of 71  Ai-amin Seastrans ltd. V. Owners and Party interested in vessel M.V. „Loyal Bird‟ AIR 1995 Calcutta 169

6. Mr. Ajay Gupta, learned senior counsel appearing for the respondents, refuting the submissions of the counsel for the appellants submitted that the issue No.1 which was framed by the learned Trial Court based on the objection taken by the appellants in their written statement confined to the institution of the plaint by a validly constituted attorney. To confine his arguments only to satisfy this court that the plaint was properly instituted by a validly constituted attorney holder, the counsel submitted that the respondents have proved on record the two Power of Attorneys as Ex. PW- 2/3 and PW- 2/4. Counsel further submitted that the enquiry with regard to the existence or otherwise of the Board Resolution was not taken up by the appellants in their written statement and, therefore, Issue No.1 framed by the learned trial court has to be read in context of dispute raised by the appellants in terms of paragraph-18 of the written statement. Counsel thus submitted that the institution of the suits was challenged by the appellants on the sole ground of the invalidity of the Power of Attorneys and not on any other ground. Counsel for the respondents further submitted RFA No. 583/2004 Page 6 of 71 that both the Power of Attorneys were duly signed by the competent officer of the respondents and the notarial certificate appended with both the Power of Attorneys clearly discloses that the Notary Public duly satisfied himself about the identity of the persons who had executed the said Power of Attorneys and also their authority to execute the same. Counsel further submitted that so far the sufficiency of stamps on the said Power of Attorneys is concerned, the same carried stamp of more than Rs.100 each and as per the Indian Stamp Act, the stamp required to be affixed as on the relevant date was Rs.10+1 (Rs.11/-). Counsel further submitted that the said Power of Attorneys were executed in the year 1995 i.e. much prior to the amendment in the Indian Stamp Act whereby the stamp duty on the Power of Attorney was raised to Rs.50/-. Counsel thus stated that the said Power of Attorneys were properly and sufficiently stamped. Coming to the arguments of authentication of the said Power of Attorneys, counsel submitted that once the Power of Attorneys were duly authenticated by a Notary, there was no requirement to get it authenticated by the office of the Consular General.

RFA No. 583/2004 Page 7 of 71

7. Inviting attention of this court to Section 57 (6) and Section 85 of the Evidence Act, the counsel submitted that under Section 85 there is a presumption that the court shall presume every document purporting to be power of attorney and to have been executed before, authenticated by, a Notary public or any Court, Judge, Magistrate, Indian Consul or Vice Consul or representative of the Central Government, was so executed and authenticated. The contention of the counsel for the respondent was that an authentication by Notary Public is sufficient to draw the said presumption and there is no additional requirement for authentication by either the Magistrate or Judge of the court or the Consular General. The counsel for the respondents also placed reliance on Section 33 of the Registration Act, 1908 and Section 14 of the Notaries Act, 1952 in support of his arguments. Counsel for the respondents also placed reliance on Section 3 of the Diplomatic and Consular Officers (Courts Fee Act) 1948. Counsel for the respondents further argued that both the said Power of Attorneys carried a ratification clause and if any of the Power of Attorneys is found not valid in the eyes of law then through the second Power of Attorney the acts of the previous attorney holder can be ratified. Counsel for the respondents further submitted that the appellants RFA No. 583/2004 Page 8 of 71 are estopped to raise the challenge at this stage about the non- filing of the Board Resolution and the Minutes Book by the principle of constructive res judicata as the matter had travelled twice to the Hon‟ble Supreme Court and no such plea was ever raised by the appellants to attack the maintainability of the suits filed by the respondents due to lack of filing of the Board Resolution giving authority to the executants to execute the said Power of Attorneys.

8. Answering the arguments of counsel for the appellants on the issue of dual capacity, learned counsel for the respondents submitted that the law does not bar institution of suits instituted by an Advocate as it only frowns upon the situation when an Advocate acts in dual capacity i.e. both as an Advocate and also as a client. Counsel also submitted that the appellants have raised this plea of dual capacity for the first time during the course of hearing of these appeals and as per the settled legal position any new plea depending on further investigation of facts cannot be allowed to be taken for the first time in appeal before the High Court or the Supreme Court. Counsel also submitted that the objection with regard to the dual capacity was never raised by the appellants either in their written statement or in the grounds of appeal of the RFA No. 583/2004 Page 9 of 71 two instant appeals. Counsel also submitted that M/s Remfry and Sagar Solicitor Concern was the sole proprietorship firm under Dr.Vidya Sagar and Mr.R.Sampath Kumar was one of the constituted attorneys of the respondents No.1 & 2. Counsel further submitted that Mr.Sameer Oberoi left the said Solicitor company sometime in May, 2000 and thereafter from June, 2001 the said company became a partnership firm where Mr.R.Sampath Kumar was one of the partners. The contention of counsel for the respondents was that the suits which were good in the eyes of law in the year 1995 cannot become bad in the year 2001. Counsel thus submitted that the judgments relied upon by counsel for the appellants of the Bombay High Court in the cases of Oil & Natural Gas Commission (supra) and of this Court in Columbia Pictures Industries (supra) will not apply to the facts of the present case, as at the time of institution of the said two suits, M/s Remfry and Sagar Solicitor Concern was a proprietorship firm and not a partnership firm. Learned counsel placed reliance on the following judgments in support of the legal proposition urged by him:

Jugraj Singh v. Jaswant Singh AIR 1971 SC 761  Rajesh Wadhwa v. Sushma Govil AIR 1989 Delhi 144  United Bank of India v. Naresh Kumar AIR 1997 SC 3 RFA No. 583/2004 Page 10 of 71  National and Grindlays Bank ltd. V. World Science News and Ors. 12(1976) DLT69  Oil & Natural Gas Commission v. Offshore Enterprises Inc. AIR 1993 Bombay 217  Crocodile int. PTE Ltd & Anr v. Lacoste S.A & Anr FAO(OS)110/2007 (Delhi)  La Chemise Lacoste & Anr. V. Crocodile Indl. Pte ltd. MANU/DE/7485/2007  Columbia Pictures Industries, Inc. & Ors v. Siti Cable Network Ltd. 94(2010)DLT177  Karpagathachi and Ors v. Nagarathinathachi AIR 1965 SC 1752  Hope Plantations Ltd. V. Taluk Land Board, Peermade and Anr. (1999)5 SCC 590

9. I have heard learned counsel for the parties at considerable length and given my thoughtful consideration to the arguments advanced by them.

10. Before I proceed to deal with the rival contentions raised by the learned Senior Advocates representing both the parties, it would be pertinent to refer to some of the admitted facts which would be relevant to decide the preliminary objections raised by the counsel for the appellants.

11. Two separate suits for permanent injunction and damages were preferred by M/s. Baker Hughes Ltd. as plaintiff no.1 RFA No. 583/2004 Page 11 of 71 which was having its principal place of business at Hammersley House, 5-8 Warwick Street, London WI/1R 5RA, United Kingdom and it is stated to be a subsidiary of M/s. Baker Hughes Incorporated impleaded in the suit as plaintiff no.2. The plaintiff no.2 M/s. Baker Hughes Incorporated was organized under the laws of the State of Delaware, United States of America, having its principal place of business at 3900 Essex Lane, Suite 1200, Houston, Texas 77027- 4740, USA. The appellants before this court are the defendants in both the suits. The said suits have been instituted by the respondents/plaintiffs through one Mr. Sameer Oberoi, who has claimed to be the constituted attorney on behalf of both the respondents/plaintiffs. Mr. Sameer Oberoi in his capacity as a constituted attorney has signed and verified the plaint on behalf of both the respondents.

12. The appellants in para 18 of the written statement took a preliminary objection to the very maintainability of the suit on the ground that Mr. Sameer Oberoi has no proper authority to sign, verify or execute the suit on behalf of the plaintiffs. The same is reproduced as under:

"Without prejudice to the foregoing the Defendant states that, even otherwise, the Suit is not-maintainable, Mr. Oberoi who has signed the Plaint purportedly on behalf of the Plaintiffs has no proper RFA No. 583/2004 Page 12 of 71 authority to sign, verify, file or institute the present Suit. The purported Power of Attorney filed before this Hon'ble Court is unstamped and is not authentic. The Power of Attorney has not been authenticated by the Consular Sector of the Indian High Commission in U.K. The Power of Attorney is, therefore, invalid and Mr. Oberoi has no power in the eyes of law to represent the plaintiffs. The Suit is, therefore, not properly instituted and has to be dismissed on this short ground alone."

13. Based on the said objection raised by the appellants, the learned trial court framed Issue No.1 as:

"1. Whether the plaint has been properly instituted by a validly constituted attorney? OPD"

14. Two separate Power of Attorneys were placed on record by the respondents. The first power of attorney which was proved on record as Ex.PW-2/3 was executed on behalf of the plaintiff no.1 i.e. Baker Hughes Ltd. and the same is signed by Peter John Woolley, Director and by Jeremy Andrew Aron, Secretary of the said company. The said Power of Attorney is notarized by one Mr. John David Woodward, Notary Public, City of London. The said Power of Attorney carries the certification and attestation of the Notary Public in the following manner:

"I, JOHN DAVID WOODWARD, Notary Public of the City of London and elsewhere in England, duly admitted and sworn, practicing in the said City, RFA No. 583/2004 Page 13 of 71 DO HEREBY CERTIFY AND ATTEST:
THAT the hereunto annexed Power of Attorney was this day signed and executed in my presence for and on behalf and as the Deed of the English Company styled "BAKER HUGHES LIMITED", a Company duly incorporated and existing in accordance with the laws of England, registered at the Companies Registration Office for England and Wales under No. 1388658 and having its Registered Office at 2nd Floor, Hammersley House, 5-8 Warwick Street, London W1R 5RA, England, by PETER JOHN WOOLLEY and JEREMY ANDREW ARON, whose identities I attest, one of the Directors and the Secretary, respectively, of the said Company.
AND THAT the said Power of Attorney being so signed, is duly executed by the said Company in pursuance of a Resolution of the Board of Directors thereof passed on the 27 th day of March 1995 and in accordance with the regulations thereof and the provisions of English Law relating to Companies.
IN TESTIMONY WHEREOF I have hereunto set my hand and affixed Seal of Office in the City of London aforesaid, this twenty-seventh day of which one thousand nine hundred and ninety- five."

15. The other Power of Attorney has been executed on behalf of the respondent no.2 i.e plaintiff no.2 M/s. Baker Hughes Incorporated and the same has been signed by Lawrence O‟Donnell, III in his capacity as Corporate Secretary. This second Power of Attorney was proved on record by the respondents as Ex. PW2/4 and the same carries the Notarial Certificate as under: RFA No. 583/2004 Page 14 of 71

"NOTARIAL CERTIFICATE On the 22nd day of March, 1995, before me, a Notary Public, personally appeared Lawrence O'Donnell, III, known to me to be the person who executed the hereunto annexed instrument on behalf of BAKER HUGHES INCORPORATED. I have seen the Constitution of the said Company and certify that Lawrence O'Donnell, III is authorized to execute the annexed Power of Attorney on behalf of the said Company and that the Power of Attorney so executed is binding on the said Company under its Constitution and the laws of________________."

16. In both the Power of Attorneys, nomination has been made in favour of Shyam Sunder Iyer, R. Sampath Kumar, Vidya Bhushan Mehrish, G. Nataraj, Ranjan Negi, Sameer Oberoi, Vidya Sagar, Hariharan Subramaniam and Yang Yen-Thaw, Advocates and V. Seetharaman and Prasanna K. Rajan, Trade Mark Agents, all of Remfry & Sagar, Remfry House, 8, Nangal Raya Business Centre, New Delhi-110046, to be jointly and severally as attorneys of the appointers to do and perform all or any of the acts, deeds, matters or things as detailed in the said power of attorneys.

17. On behalf of the respondents/plaintiffs, Mr. Phillip S.R. Jackson and Mr. R. Sampath Kumar adduced their evidence as PW1 and PW2 respectively. The relevant portion of the deposition given by Mr. Phillip S.R. Jackson, so far the controversy in hand is concerned, is reproduced as under:

RFA No. 583/2004 Page 15 of 71

"3....... I am the Legal Counsel Asia Pacific for the Plaintiffs.
4. I say that I have full and easy access to the records of the Plaintiffs relative to the case and am conversant with the facts and circumstances of the case, I say that the Power of Attorney of Baker Hughes Limited has been signed and executed by Mr. Peter John Woolley (Director) and Mr. Jeremy Andrew Aron (Secretary) and the Power of Attorney of Baker Hughes Incorporated has been signed and executed by Mr. Lawrence O Donnell, III(Corporate Secretary) all of who, I have worked with in the Plaintiff company and I have seen them writing and signing the said documents and I can, as such, identify their signatures on the Powers of Attorney.
5. The suit on behalf of the Plaintiffs was filed and instituted by Mr. Sameer Oberoi by virtue of the said Power of Attorney attached to the affidavit of Mr. R. Sampath Kumar as Exhibit PW1/3."

18. The relevant portion of the cross-examination of PW 1 Phillip S.R. Jackson is also reproduced as under:

"Q. Whether John Waldron Byrne a Notary Public recognized by the Indian Consular.
A. I cannot say whether John Waldron Byrne is recognized by Indian Vice Consular at Perth. Vol. He is very senior legal practitioner and has been notary public for many many years.
I did not get my affidavit legalized by Indian Consular Officer because I was not advised by my counsel in India to do so. I am legal counsel to Baker Asia Pacific from 01.04.1996. I qualified as a lawyer in 1980. I am not getting any retainer fee or adhoc fee from Baker Asia Pasific but I am an officer arid employee of the Baker Asia Pacific, I am also the President of Baker Hughes Asia Pacific Ltd. I am receiving salary from Baker Hughes Australia Pty Ltd. Baker Hughes incorporated does not have articles of association but it has byelaws and I have not brought the byelaws with me.
RFA No. 583/2004 Page 16 of 71
I have not brought any minute book or any resolution of Baker Hughes Incorporated authorizing the filing of this action or for the giving of a power of attorney in connection with this action. Vol. There is no such notation in the minute book and no such resolution.
I am not aware if there power of attorney granted by Baker Hughes Incorporated expired long long ago.
All the records relating to the negotiation between the plaintiffs and deft. No.1 are kept in my office at Perth. I met Peter John Wolley in 1996. I met him in the Foyer in Double Tree Hotel in Houston. I interested and met him from 1996 to 2003. I met Jeremy Andrew Aron in July, 1996 in Houston, Texas. It is incorrect to suggest that I have never seen them writing or signing any document. Mr. Sameer Oberoi is the practicing lawyer and he was employed by the firm of Remfy and Sagar who are our lawyers at Delhi, Baker Hughes Ltd. entered into an agreement with deft. No.1. Again said, corrected himself and say that it was novated, originally it was entered in Baker Oil Tools UK Ltd. Plaintiff no.2 ultimate holding company of plaintiff no.1."

19. The relevant extract from the affidavit of PW2, Mr. R Sampath Kumar is also reproduced as under:

"Plaintiff No.1 is a company organized under the laws of United Kingdom having its principal place of business at Hammersley House, 5-8 Warwick Street, London WIR 5RA. The original certified copy of registration of Plaintiff No.1 from the Registrar of Companies, United Kingdom, duly legalized by the Consulate General of India, United Kingdom is attached to my affidavit as Exhibit PW2/1.
Plaintiff no.2 is a company organized under the laws of the State of Delaware. United States of America having its principal place of business at 3900 Essex Lane, Suite 1200, Houston, Texas 77027-4740, United States of America. The original certified copy of registration of Plaintiff No.2 from the Secretary of State, RFA No. 583/2004 Page 17 of 71 duly legalized by the Consulate General of India, United States of America is attached to my affidavit as Exhibit PW2/2.
I am the Constituted Attorney of the Plaintiffs under notarized Power of Attorney dated March 27, 1995, the original whereof is attached to my affidavit as Exhibit PW2/3.
I say that I have full and easy access to the records of the Plaintiffs relative to the case and am conversant with the facts and circumstances of the case. I say that the Plaint has been signed and verified by Mr. Sameer Oberoi who used to work with me in Remfry & Sagar and I have seen him writing and signing and I can as such identify his signature on the plaint, replication, vakalatnama and other documents related to this suit.
The suit on behalf of the Plaintiffs was filed and instituted by me by virtue of the said Power of Attorney attached as Exhibit PW2/4.

20. The relevant extract of cross-examination of PW-2 Mr. R. Sampath Kumar is also reproduced as under:

"I have filed affidavit C-2 signed by me and attested by Oath Commissioner on 14.7.2004. I also identify signature of Sh. Sameer Oberoi. Some documents mentioned in my affidavit have been placed on record. Let the witness may be cross-examined by Ld. Cl for Defendants.
XXX by Ld. Cl. For Defendants.
I am an advocate. I am advocate working as partner with Remfy and Sagar. Remfry & Sagar are Solicitor and Advocate of Plaintiff. I am deposing as witness in the capacity of partner of Remfry and Sagar.

Vol. I am constituted attorney of Plaintiff. My recollection is power of attorney has been produced. My power of attorney was executed most probably in USA. I do not remember as to under which law of the state of USA the attorney was executed. I also do not remember as to before which Notary Public of USA the power of attorney was produced. The attorney was not attested by Indian Counsel or Officers. The facts of RFA No. 583/2004 Page 18 of 71 the case were told to me by Plaintiff and I was not personally involved in the negotiation or agreement between parties. It is incorrect to suggest that I have sworn the facts in my affidavit on the basis of information given to me by my client. I went through record and papers of this case in Remfy and Sagar Office approximately in 1994. Mr. Sameer Oberoi was associated with Remfy and Sagar in his capacity as lawyer. He was obtaining retainer fee. He was working full time with Remfy and Sagar. The verification by Mr. Oberoi was on the basis of his personal knowledge. Mr. Oberoi was having knowledge of the documents executed between parties and abut the facts of the case on the basis of documents/record perused by him. He was not witness to the execution of any document. Plaintiff No.1 and Plaintiff No.2 are affiliated with each other as common company and both belong to parent company. I do not know as to which of the plaintiff is parent company of other company. I am not aware if there are so many companies in the name of Baker who are subsidiary company of the holding company. I am aware about the names of the company concerning Baker and the same are plaintiffs company and hence, I cannot tell how many companies are there in USA and UK in the name of Baker. I do not remember where plaintiff no.1 company is incorporated. I also cannot say if plaintiff no.2 was incorporated earlier to plaintiff no.1. It is incorrect to suggest that I have not gone through the record and papers of this case and not giving correct information. I do not know where the record of negotiation was executed between parties in 1983. I have seen the records of negotiation between both parties. I have seen some of the records of 1983. Negotiations were about a joint venture between the plaintiff and defendant. The record of 1984-85 are with plaintiff no.1 and 2. Photocopies of some of the record are also in Remfy and Sagar. I have seen all pertinent record supplied by both plaintiffs to Remfry and Sagar in photocopies. It is incorrect to suggest that plaintiff no.1 and 2 have not sold their goods for last 10/12 years in dollar or in pound sterling in India. I cannot tell orally of what amount the plaintiffs have sold the goods in India.

I do not remember whether plaintiff no.1 was incorporated in 1978. I might have referred in my affidavit to document dated 13.09.1978. I do not know what the company by the name Legious Five Ltd. has got anything to do with the plaintiff. I do not know as to what is has to do with Bakers Energy Holding Ltd, with any of the plaintiffs company. RFA No. 583/2004 Page 19 of 71

Without looking the certificate of incorporation, I cannot tell difference between Baker International Ltd. and Bakers Huge Incorporated. I am aware about the fact that plaintiff no.2 applied for registration of the trade mark Baker in India first time in 04.07.1994. I was ill service of Remfry and Sagar in 1994. I was full time assistant in Remfry and Sagar. I was not aware whether if deft. No.2 was registered owner of trade mark Baker before 04.07.1994 in India.

In Dec. 1984 I was with Remfry and Sagar as full time assistant as advocate. I do not remember as to where I was physically present on 21.12.1984. I was in India on that date.

Q. Are you aware about any resolution of the Board of Directors for General Body of the plaintiff no.1 or plaintiff no.2 authorizing the institution of the suit or granting the power of attorney for that purpose. A. I do recall Board Resolution but I do not know the date of resolution.

I do not remember if any copy/certified copy of the Board Resolution has been placed on record or not. It is incorrect to suggest that there is no such resolution passed by plaintiff company on record. It is also correct that the power of attorney filed by Mr. Oberoi has not been attested by any Indian Counsellor Officer. I once went to Hongkong in 1989. I went there in connection with International Buyer Association Conference."

21. The appellant in RFA 583/04 in para 66 and 67 of the appeal has raised the objection attacking the very institution of the suit by Mr. Sameer Oberoi without any authority of corporate resolutions. The said paras are also reproduced as under:

"66. Because the non-application of mind of the learned Trial Court is also clear from the wrong statement in the Impugned Judgment at internal page 2 that "the Suit has been instituted by Shri I.R. Sampath Kumar on behalf of Plaintiff Company". As the record will show no suit was RFA No. 583/2004 Page 20 of 71 instituted by "Shri I.R. Sampath Kumar." The Trial Court record shows at page 1:021-1:022 that the Plaint was signed and verified by one Sameer Oberoi. The annexed Plaint may be seen for signature and verification. Neither Shri I.R. Sampath Kumar nor Shri Sameer Oberoi had the authority under any corporate Resolution to file the Suit. Respondent Nos 1 and 2's witness PW1 Phillip S R Jackson admitted that there was no Resolution of the Plaintiffs whatever.
67. Because the learned Trial Court wrongly entertained the Suit which was filed by an Advocate retained by the Respondents Nos. 1 and 2 who admittedly had no personal knowledge of the facts and who was not authorized by any Resolution to institute the Suit on behalf of the Corporations."

22. In the aforesaid factual background, the legal and factual issues which have been raised by the counsel appearing for the parties can be formulated in terms of the following questions:-

1. Whether the respondents succeeded in proving the authority of Mr. Sameer Oberoi to sign, file, verify and institute the suit on behalf of the respondents based on the two Power of Attorneys filed by him?
2. Whether the respondents had duly proved the execution and authentication of two Power of Attorneys by notary public so as to claim raising of presumption in their favour under Section 85 of the Indian Evidence Act?
3. Whether the appellants can be allowed to raise a new plea so as to challenge the maintainability of the suit filed by the respondents before the learned Trial Court on the ground of dual capacity of an Advocate i.e. one as an attorney holder for a client and other as an Advocate?
RFA No. 583/2004 Page 21 of 71
4. Whether the appellants are estopped to challenge the maintainability of the suit by the principle of constructive res judicata after having failed to raise the issue earlier when the matter had travelled twice to the Supreme Court?

` QUESTION NO.1& 2

23. It is well settled that under Section 291 of The Companies Act, 1956 except where express provision is made that the powers of a company in respect of a particular matter are to be exercised by the company in general meetings, in all other cases the Board of Directors are entitled to exercise all its powers and to do all such acts and things, as the company is authorized to exercise and do. Individual Directors have such powers as are vested in them by the Memorandum and Articles of Association of the company. In Nibro Limited vs. National Insurance Co. Ltd. 41 (1990) DLT 633 this Court had drawn a clear distinction between the authority to sign, file and verify the suit and the authority to institute the suit. Referring to the provisions of Order 3 Rule 1 and Order 29 Rule 1 of the Code of Civil Procedure, the Court in the said judgment in the following paras held as under:- RFA No. 583/2004 Page 22 of 71 "10. It will be useful to reproduce the two provisions of the Code of Civil Procedure, namely, Order 3, rule 1 and Order 29, rule 1, on which the plaintiff relies.

11. Order 3, rule 1 of the Code of Civil Procedure reads thus : "Any appearance, application or act in or to any court, required or authorised by law to be made or done by a party in such court, may except where otherwise expressly provided by any law for the time being in force, be made or done by the party in person, or by his recognized agent or by a pleader appearing, applying or action, as the case may be, on his behalf:

Provided that any such appearance shall, if the court so directs, be made by the party in person."

12. Order 29, rule 1 of the Code of Civil Procedure reads thus : "In suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or be any director or other principal officer of the corporation who is able to depose to the facts of the case."

13. Order 3, rule 1 provides that any appearance, application or act in or to any court required or authorise by law can be made or done by the party in person or by his recognized agent or by a pleader appearing, applying or acting, as the case may be, on his behalf. Provided of course, such an appearance, application or act in or to any court is required or authorised by law to be done or done by a party in such court. Where, however, there is an express provision of law, then that provision will prevail. Thus, if an authority is given to a pleader or a recognised agent as provided by law, the recognised agent or pleader can file an appearance or file a suit in court if the party himself is not in a position to file it. In my view, if a party is a company or a corporation, the recognised agent or a pleader has to be authorised by law to file such a plaint. Such an authority can be given to a pleader or an agent in the case of a company by a person specifically authorised in this behalf. In other words, a pleader or an agent can be authorised to file a suit on behalf of a company only by an authorised representative of the company. If a director or a secretary is authorised by law, then he can certainly give the authority to another person as provided under Order 3, rule 1.

14. Order 29, rule 1 of the Code of Civil Procedure provides for subscription and verification of pleadings and states that in suits by or against the corporation, any pleadings may be signed and verified on RFA No. 583/2004 Page 23 of 71 behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case.

..............

29. It is well-settled that under section 291 of the Companies Act except where express provision is made that the powers of a company in respect of a particular matter are to be exercised by the company in general meeting, in all other cases the board of directors are entitled to exercise all its powers. Individual directors have such powers only as are vested in them by the memorandum and articles. It is true that ordinarily the court will not unsuit a person on account of technicalities. However, the question of authority to institute a suit on behalf of a company is not a technical matter. It has far-reaching effects. It often affects the policy and finances of the company. Thus , unless a power to institute a suit is specifically conferred on a particular director, he has no authority to institute a suit on behalf of the company. Needless to say such a power can be conferred by the board of directors only by passing a resolution in that regard. Chapter IV of the Delhi High Court (Original Side) Rules deals with the question of presentation of suits. Under this rule, a suit can be presented by a duly authorised agent or by an advocate duly appointed by him for the purpose. This authorisation, in my view, in the case of a company can be given only after a decision to institute a suit is taken by the board of directors of the company. The board of directors may in turn authorise a particular director, principal officer or the secretary to institute a suit.

30. The plaintiff has not placed on record any resolution passed by the company authorising Shri G. Jhajharia to institute the suit. Shri G. Jhajharia did not come forward to make a statement that he was in a position to depose to the facts of the case. In the plaint signed by him, he claims to be a principal officer and director, but there is no evidence on record to indicate that he had the authority to institute the suit. The memorandum and articles of association of the plaintiff company are also not placed on record. Even after the suit was instituted by Shri G. Jhajharia, no resolution was passed by the company ratifying this action. No such decision of the board of directors is placed on record in the present case. The plaintiff has examined Shri Ashok Kumar Jhajharia. He has placed on record, exhibit PW-2/1, which is the resolution of the board of directors reappointing Shri G. Jhajharia as the director but this resolution does not empower Shri G. Jhajharia as a director to institute the present RFA No. 583/2004 Page 24 of 71 suit. Shri Ashok Kumar Jhajharia has stated that he was handling the day-to-day management of the plaintiff company including the insurance part of it. He, however, does not state that Mr. G. Jhajharia was handling the day-to-day management or was in charge of the insurance claim.

31. Thus, there is no evidence to prove that Shri G. Jhajharia had the authority to institute the present suit.

32. Issue No.4 is thus decided against the plaintiff and in favor of the defendant."

24. The said position was reiterated by this Court in the matter of M/s Rajghria Paper Mills Ltd. vs General Manager, Indian Security Press & Anr. AIR 2000 Delhi 239. I had also the occasion to deal with the a similar issue in the matter of Lucas Indian Services Ltd. vs. Sanjay Kumar Aggarwal 173(2010) DLT 438 and it would be useful to refer following paras therefrom: "11. Order 6 Rule 14 mandates that every pleading shall be signed by the party and its pleader. So far the singing of a plaint on behalf of a company is concerned, a company being a corporate body or a juristic person has to act through somebody and that person has to be specifically authorized either under its Articles of Association or through a Board Resolution to sign, file and verify the suit. So far Order 29 Rule 1 of CPC is concerned, it authorizes the Secretary, Director or other Principal Officer of the Corporation to sign and verify the pleading on behalf of the corporation. In the case of Nibro Ltd. v. National Insurance Co. Ltd. : AIR 1991 Delhi 25 this Court held that Order 29 Rule 1 CPC does not authorize persons mentioned therein to institute the suits on behalf of the corporation. Relevant para of the said judgment is referred as under:

"..........................

RFA No. 583/2004 Page 25 of 71

27. On the analysis of the judgments, it is clear that Order 29, Rule 1 of the Code of Civil Procedure does not authorise persons mentioned therein to institute suits on behalf of the corporation. It only authorises them to sign and verify the pleadings on behalf of the corporation".

12. Coming back to the facts of the present case, the appellant has placed on record certified true copy of the Board Resolution wherein authority was given to Mr. S. Ramanathan, Financial Controller, to institute legal proceedings on behalf of the company with further authority to authorize and nominate and appoint any other Officer of the company to do all such acts and deeds on behalf of the Company. Based on the said resolution Mr. S. Ramanathan, had given the authority to Mr. K.K. Sen vide authority letter dated 26.5.2000. It is an admitted fact between the parties that the said Board Resolution was not proved on record and even Mr. S. Ramanathan also did not enter the witness box to prove the said authority letter dated 26.5.2000 proved on record as Ex. PW-2/1. It is also an admitted fact that Mr. K.K. Sen has signed, filed and verified the plaint on behalf of the appellant company. The appellant herein is a private company and is not a public body or corporation as it was in the case of Naresh Kumar (Supra). It is also not the case of the appellant that Mr. K.K. Sen was one of the principal officers of the appellant company in terms of Order 29 Rule 1 CPC. Admittedly Mr. S. Ramanathan derived his authority to nominate an officer of the company under the Board Resolution dated 29.11.1994. The question therefore arises is that once the appellant failed to prove the said Board Resolution in favour of Mr. S. Ramanathan then how the authority of Mr. S. Ramanathan to appoint further officer could be established. No explanation has come forth from the appellant as to why Mr. S. Ramanathan himself was not produced in the evidence as he being the principal officer of the company could validly prove not only his own authority but the said authority conferred by him in favour of Mr. K.K. Sen. At no stage of the trial, the appellant company also took any steps to rectify the said defect and even at the appellate stage as well no such request has been made in this regard. ............

14. The facts of the present case are more near to the facts of the case of Nibro Ltd. (Supra). Here it would be useful to refer to paras 30 & 31 of the said judgment as under:

............................

RFA No. 583/2004 Page 26 of 71 In the facts of the present case, the Resolution of the Board empowering Mr. S. Ramanathan (Financial Controller) was not proved on record. Mr. S. Ramanathan himself did not enter the witness box to prove the said authority letter issued by him in favour of Mr. K.K. Sen. Mr. K.K. Sen admittedly was not the principal officer of the appellant company. Further as per the certificate issued by Mr. S. Ramanathan in his favour no authority was given to him to institute the said suit. Taking into consideration all these facts this Court is of the considered view that Ld. Trial Court has rightly and correctly decided the issue No. 2 in favour of the respondent and against the appellant."

25. Coming to the facts of the case at hand, the respondents have filed the suits in question through one Mr. Sameer Oberoi in his capacity as constituted attorney for both the respondents/plaintiffs. Admittedly, Mr. Sameer Oberoi is neither a principal officer nor Director or Secretary of the respondent companies and he derives his authority not only to sign, file and verify the suits, but to institute the same by virtue of two separate Power of Attorneys executed by respondents No. 1 and 2 in his favour. It is not in dispute that Mr. Sameer Oberoi was one of the Advocates working for the Solicitor Concern M/s Remfry and Sagar. Hence, the crucial question for determination is that: "Whether the respondents/plaintiffs were required to prove on record the authority of the executants of the said Power of Attorneys through the Board Resolution or Articles of Association or there was no need to prove the authority of the executants of the Power of Attorneys once the respondents/plaintiffs had succeeded to prove the due execution and authentication of the said Power of Attorneys by duly appointed Notary Public entitling the respondents to the benefit of Section 85 of the Indian RFA No. 583/2004 Page 27 of 71 Evidence Act for raising a presumption for the due execution and authentication of the said attorneys?"

26. It is an admitted case between the parties that the respondents did not place on record any certificate, copy of the Board Resolution or the copy of the minutes book wherein such a Board Resolution was passed to support the authority of the executants of the said two Power of Attorneys. The first Power of Attorney, which was proved on record as Exhibit PW2/3 was executed by Mr. Peter John Woolley, Director and by Jeremy Andrew Aron, Secretary of respondent No. 1 company while the second Power of Attorney proved on record as Exhibit PW2/4 was executed by Lawrence O‟Donnell, III in his capacity as Corporate Secretary. Both the said Power of Attorneys are attested by the Notary Public and a separate notarial certificate can be seen appended with both the said Power of Attorneys. In the first Power of Attorney, Ex. PW2/3, the Notary Public has referred to the Resolution of the Board of Directors passed by them in their meeting held on 27 th day of March, 1995. The notarial certificate of first Power of Attorney also refers to the presence of both the executants i.e. Peter John Woolley, and Jeremy Andrew Aron whose position in the company the Notary Public has duly attested; one being Director and other RFA No. 583/2004 Page 28 of 71 being Secretary. Similarly in notarial certificate certified by the Notary Public in respect of the second Power of Attorney he also duly acknowledges the presence of executants Lawrence O‟ Donnell, III besides referring to the constitution of company wherein due authority has been given to the said officers to execute the Power of Attorney on behalf of the company. Section 57(6) of the Indian Evidence Act provides that the Court shall take judicial notice of all the seals of which English Courts take judicial notice and the seals of Notary Public. Under Section 85 of the Indian Evidence Act, the Court shall presume that every document purporting to be Power of Attorney, which has been duly executed before and authenticated by Notary Public can be taken to have been so executed and authenticated. Section 8 of The Notaries Act, 1952 describes the functions of notaries as under:-

"8. Function of Notaries.-

(1) A notary may do all or any of the following acts by virtue of his office, namely:-

(a) verify, authenticate, certify or attest the execution of any instrument.

(b) Present any promissory note, hundi or bill of exchange for acceptance or payment or demand better security.

(c) note to protest the dishonour by non acceptance or non payment of any promissory note, hundi, bill of exchange or protest for better security or RFA No. 583/2004 Page 29 of 71 prepare acts of honour under the Negotiable Instruments Act, 1881, or serve notice of such note or protest.

(d) note and draw up ship's protest, boat's protest or protest relating to de moorage and other commercial matters.

(e) administer oath to, or take affidavit from, any person,

(f) prepare bottom and respondent bonds, charter parties and other mercantile documents.

(g) prepare, attest or authenticate any instrument intended to take effect in any country or place outside India in such form and language as many conform to the law of the place where such deed is intended to operate.

(h) translate, and verify the translation of, any document from one language to another.

(i) any other act which may be prescribed.

(2) No act specified in sub-section (1) shall be deemed to be a notaries act except when it is done by a notary under his signature and official seal."

27. The decision of the Hon‟ble Apex Court in the matter of Jugraj Singh and Anr. vs Jaswant Singh and Ors. AIR 1971 SC 761 is a landmark judgment which helped to clear the air surrounding the legal proposition with regard to the presumption arising under section 85 and relevant para of the same is reproduced as under:-

"7. The short question in this case is whether Mr. Chawla possessed such a power of attorney for executing the document and for presentation of it for registration. Now, if we were to take into account the first power of attorney which was executed in his favour on May 30, 1963, we would be forced to say that it did not comply RFA No. 583/2004 Page 30 of 71 with the requirements of the law and was ineffective to clothe Mr. Chawla with the authority to execute the sale deed or to present it for registration. That power of attorney was not authenticated as required by Section 33 of the Indian Registration Act which in the case of an Indian residing abroad, requires that the document should be authenticated by a Notary Public. The document only bore the signature of a witness without anything to show that he was a Notary Public. In any event there was no authentication by the Notary Public (if he was one) in the manner which the law would consider adequate. The second power of attorney however does show that it was executed before a proper Notary Public who complied with the laws of California and authenticated the document as required by that law. We are satisfied that that power of attorney was also duly authenticated in accordance with our laws. The only complaint was that the Notary Public did not say in his endorsement that Mr. Chawla had been identified to his satisfaction. But that flows from the fact that he endorsed on the" document that it had been subscribed and sworn before him. There is a presumption of regularity of official acts and we are satisfied that he must have satisfied himself in the discharge of his duties that the person who was executing it was the proper person. This makes the second power of attorney valid and effective both under Section 85 of the Indian Evidence Act and Section 33 of the Indian Registration Act."

28. This Court in the matter of Citibank N.A., New Delhi vs Juggilal Kamlapat Jute Mills Co. Ltd. AIR 1982 Delhi 487 had the benefit of examining a similar issue where also the authority of the Power of Attorney holder was questioned in the absence of proving the Board Resolution. Answering the controversy, the Court in the following paras held as under:- "20. Section 85 of the Evidence Act reads as under : "Presumption as to powers of attorney. - The court shall presume that every document purporting to be a power of attorney, and to have been executed before, and authenticated by, a notary public, or any court, RFA No. 583/2004 Page 31 of 71 judge, magistrate, Indian Consul or Vice-Consul, or representative of the Central Government, was so executed and authenticated."

21. For raising a presumption under this section, the twin requirements to be fulfillled are : (1) that the document in question must purport to be a power of attorney, and (2) that it must purport to have been executed before and authenticated by a notary public, or any court, judge, magistrate, Indian consul, or vice-consul, or representative of to Central Government. Exhibit P-42A is a document which purports to be a power to be a power of attorney. It further purports to have been executed before and authenticated by a notary public. Thus, both these requirements stand fulfillled and there is no dispute to this extent.

22. What presumption has to be raised under s. 85 of the Evidence Act ? Section 85 says that the court shall presume that such a document was so executed and authenticated. Executed by who : obviously by the person purporting to have executed the power of attorney before the notary public. Exhibit P-42A is purported to have been executed by Water R. Humphrey, executing officer, and Carl W. Desch, cashier, for the First National City Bank. It bears the seal of the bank. The real executant or the donor of powers is, therefore, the First National City Bank. Section 85 in terms makes no distinction between a natural person and legal person. Thus, a presumption would have to be raised under s. 85 that this power of attorney had been executed by the said bank. In other words, it will also be presumed that the two officers had the authority to execute the power of attorney on behalf of the bank.

23. The authentication is not merely attestation but something more According to Law Lexicon by T. P. Mukherjee and K. K. Singh, authentication connotes an attestation made by an authorised officer by which he certifies that a record is in due form of law. The words "due form of law" are very important and lend support to the contention of the learned counsel for the plaintiff, namely, that under s. 85 a presumption would arise that the two officers, who executed the power of attorney on behalf of the bank, were competent to do so. The nature ad manner of the authentication by the notary public also support this contention. If it was not required of the notary public to satisfy himself about the competence of these two officers to execute the power of attorney, there was no necessity for him to satisfy himself about their power to execute the power of attorney.

24. In the absence of any provision contained in s. 85 of the Evidence Act, any party to a suit, etc., relying on a power of attorney would have to prove it like any other document by producing in the witness- box the executant of the document, or the person in whose presence it was so executed, or the person acquainted with the signatures of the RFA No. 583/2004 Page 32 of 71 executant, etc., as the case may be. If that party is a company corporated in India or in any other country, it would be further required to prove that the person or persons executing the power executing the power of attorney on its behalf had been duly authorised by means of a resolution duly passed in accordance with law and the articles of association. The purpose of s. 85, in my view, is to eliminate all this cumbersome evidence in case such a power of attorney is executed before and authenticated by a notary public, or other authorities mentioned therein. If evidence to prove these facts except the fact of execution by the executant was insisted upon, most of the purpose of s. 85 would be frustrated specially in these days of prevalent international trade.

25. This very question came up for consideration before this court in National & Grindlays Bank v. Radio Electronics Corporation P. Ltd. [1978] RLR 217. After detailed discussion, Gill J., upon examining the various authorities and meaning of the word "authentication", held as under :

"In my view section 85 (of Evidence Act) does not draw any distinction between the kind of documents, viz : Power of attorney executed by an individual and the one executed on behalf of a company. Authentication of any of these instruments by a notary public raised a legal presumption that the same has been duly executed and the person or persons, who had executed, had the authority to do so. Undoubtedly, such a presumption is not conclusive, being rebuttable. The other party is, therefore, legally entitled to disprove such a presumption. The reason to incorporate such a provision is quite obvious. Its inclusion is intended to obviate the production of evidence as is other wise enjoined to prove the execution of the document. Embarking on an inquiry and demanding proof about the authority of the executant would frustrate the very purpose for which section 85 has been engrafted. Moreover, asking for proof would have far reaching consequences. Apart from entailing delay and unnecessary expense, it would also hamper the entire trade, more particularly trade. Thus, the interpretation placed by the learned counsel for the defendants does not reflect or effectuate the real legislative intention. It, on the other hand, unwarrantedly restricts and whittles down the true meaning and legitimate scope of an unambiguous provision."

26. Similar view was taken by Sultan Singh J. in Suit No. 671/77, Bank of India v. Ajaib Singh Pritam Singh, decided on April 20, 1979. RFA No. 583/2004 Page 33 of 71 Repelling the contention of the defendants to the contrary, it was observed as under :

"The contention of the learned counsel for defendants Nos. 1 to 3 is that there is a presumption of the execution of power of attorney, i.e., the signatures of the executant on the power of attorney, but there is no presumption that the persons executing the power of attorney on behalf of the plaintiff-bank were duly authorised to execute such power of attorney. I do not agree. If the contention of the learned counsel for the defendants is accepted, section 85 of the Evidence Act would become redundant. The purpose of section 85 of the Evidence Act is that the power of attorneys are executed throughout the world and if such power of attorney is executed and authenticated by a notary public or other officer as mentioned in section 85 of the Evidence Act, the court is bound to presume that the power of attorney was so executed and authenticated. This presumption, however, is a rebuttal presumption and the person challenging the authority of the attorney under such power of attorney is to prove that such power of attorney is invalid or that the person acting on the basis of such power of attorney is not duly authorised."

27. The decision of Gill J., referred to above, was followed.

29. This court is thus constantly taking the view that under s. 85 of the Evidence Act, it would also be presumed that the person executing the power of attorney on behalf of a corporate body was competent to do so. I find no reason to take a different view.

I, consequently, hold that Mr. M. M. Bahl was competent to sign and verify the plaint and file the suit. Issue is decided in favor of the plaintiff."

29. In another case dealt by this Court in National and Grindlays Bank Ltd. vs World Science News and Ors. AIR 1976 Delhi 263 it was held as under:-

"(10) The document in the present case is a power of attorney and again on the face of it shows to have been executed before, and authenticated by, a notary public. In view of Section 85 of the Evidence RFA No. 583/2004 Page 34 of 71 Act, the Court has to presume that it was so executed and authenticated. Once the original document is produced purporting to be a power of attorney so executed and attested, as stated in S. 85 of the Evidence Act, the Court has to presume that it was so executed and authenticated. The provision is mandatory, and it is open to the Court to presume that all the necessary requirements for the proper execution of the power of attorney have been duly fulfilled. There is no doubt that the section is not exhaustive and there are different legal modes of executing a power of attorney, but, once the power of attorney on its face shows to have been executed before, and authenticated by, a notary public, the Court has to so presume that it was so executed and authenticated. The authentication by a Notary Public of a document, purporting to be a power of attorney and to have been executed before him is to be treated as the equivalent of an affidavit of identity. The object of the section is to avoid the necessity of such affidavit of identity. Under Section 57 sub-section (6) of the Evidence Act, the Courts have to taken judicial notice of the seals of Notaries Public and when the seal is there, of which judicial notice is taken, there is no reason why judicial notice should not be taken of the signatures as well". What is argued by Shri Rameshwar Dial, learned counsel for defendants I to 3, is that the Notary Public in Section 85 or Section 57 of the Evidence Act merely means notaries appointed under the Notaries Act 1952. The argument is that where a document purports to be a power of attorney, before the Court can presume it to be so executed and authenticated as is contemplated by S. 85, it should have been authenticated by Indian Consul or Vice-Consul or the representative of the Central Government and not by a notary public of a foreign country. For one thing Notaries Act 1952 was not there when Evidence Act which was the first Act of 1872 was enacted. Secondly, the purpose of Sections 57 and 85 is to cut down recording of evidence. For such matters, like the due execution of a power of attorney in the present day of international commerce, there is no reason to limit the word "Notary Public" in S. 85 or Section 57 to Notaries appointed in India. The fact that notaries public of foreign countries have been recognised as proper authorities for due execution and authentication for purpose of section 85 of the Evidence Act is illustrated by the Supreme Court in case Jugraj Singh and anr. v. Jaswant Singh and ors. : [1971]1SCR38 . In this case the Supreme Court held that a power of attorney executed and authenticated before a notary public of California satisfied the test of S. 85 of the Evidence Act and S. 33 of the Indian Registration Act. If the interpretation of notary public is limited to notaries public appointed in this country only, it will become impossible to carry on commerce with foreign countries. Surely, S. 57 of the Indian Evidence Act which enjoins upon the Courts to take judicial notice of seals of Notary Public, such judicial notice cannot be limited to Notaries appointed in India only It seems clear if the entire sub-section is read. Once, this conclusion is reached, there is no reason to limit the meaning RFA No. 583/2004 Page 35 of 71 of the expression "Notaries Public" in S. 85 of the Indian Evidence Act to Notaries appointed in India only.

(11) In this view of the matter, it must be presumed that the power of attorney in favor of John Herbert Keeble was duly executed and authenticated. This presumption, like other presumptions is rebuttable, but, once, the original power of attorney bearing the signature and seal of the notary public is produced, which expressly confers the power on the attorney to institute suits, the burden immediately shifts to the defendants, who dispute the execution of such a power of attorney. Therefore, instead of calling upon the defendants to give better particulars of their objections as to the proper, institution of the suit, I think, it is fit and proper, if issue No. 1 is divided and the burden regarding the proper institution of the suit by a duly authorised person, is placed on the defendants. Issue No. 1 is accordingly divided as under :-

1. Whether the plaint has been signed and verified by a duly authorised person? O.P.P. I A. Whether the suit has not been instituted by a duly authorised person? O.P.D.

(12) The application is allowed to this extent. The Original Power of Attorney is returned for the present to Counsel for the plaintiff."

30. In yet another case of Rajesh Wadhwa vs Sushma Govil AIR 1989 Delhi 144 this Court took a view that even though there might not be reciprocity between India and another country, the notarial acts of Notary in the foreign country could be given legal recognition by the Court. The Court further held that Notification under Section 48 of The Notaries Act was held to be non-mandatory. The relevant para of the said judgment is reproduced as under:-

RFA No. 583/2004 Page 36 of 71 "So, this Court has to independently consider whether in absence of any notification under Section 14 of the Notaries Act the power of attorneys endorsed by Notaries Public of USA are admissible in evidence or not Counsel for the respondent has cited In re : K. K. Ray (Private) Limited. : AIR1967Cal636 In the cited case, an affidavit attested by Notary of New York (U.S.A.) was sought to be relied upon. The Court referred to the practice of recognition of notarial acts of foreign countries based on history and tradition and observed as follows:

The Notary Public is an institution of very ancient origin. It is an institution of great utility and the Notary Public is an officer recognised by the whole commercial world and a certificate by a Notary Public, competent to administer an oath to persons making declarations or affidavits, is sufficient evidence of the execution of the instrument to which it refers.

The Court further observed as follows :

"It is common knowledge that the office of a Notary Public had its originl in the civil institutions of ancient Rome. Subsequently, the Notaries found their way in England and were regarded as originally officers of the civil and the canon law, and acted by imperial and Papal authority. The records of Edward the Confessor mention deeds attested by a Notary. In a deed by King John dated A.D. 1199 it was supposed to be written and attested by one Master. Philip, a notary, who was described as a Notary of the Pope. Many of the Notaries at that time were created by the counts palatine, who not only made the appointments themselves but also delegated their powers to English churchmen. Matters of a commercial nature gradually came to dominate the work of the Notary Public, and there grew up a separation from their ecclesiastical origin. It is also common knowledge that the functions of an English Notary are not defined by any statutory provision or rule. Generally speaking no person in England is entitled to practice as a Notary Public or do any notarial acts unless he has been duly sworn, admitted and enrolled in the Court of Faculties belonging to the Arch Bishop of Canterbury. A part of Indian legal history is that it was these persons before the year 1952 who practiced as Notary Public in India. In the year 1952 the Indian Notaries Act came into operation to which I shall make a reference presently. Brooke's Treatise on the Office and Practice of a Notary of England, 8th Ed. p. 19, points out :
RFA No. 583/2004 Page 37 of 71

"From a remote period English notaries have exercised the right to administer oaths and take affidavits. These affidavits are, for the most part, intended for use in the British dominions abroad and in foreign countries where notarial acts are recognised. They may also act as commissioners for oaths under commissions granted by colonial and foreign authorities"

English Courts, when required by statute or statutory rule, take judicial notice of the seal and signature of a Notary Public, for instance, under the English Commissioners for Oaths Act, 1889 or old Rules of the Supreme Court, England Order 38, Rule 6.

".....In Brooke's Treatise which is an authority on this subject and which I have just quoted, this point is discussed at pp. 52-53. It is said there : "Where, therefore, an affidavit affirmation, declaration, etc. is sworn or taken before any of the persons mentioned in this rule no verification of the seal or signature is necessary; but where it is sworn or taken in a country not under the dominion of His Majesty, before a foreign notary, or before a person authorised by foreign law, the authority and the signatures of the notary or other person must be verified. The verification required is a certificate annexed to the affidavit, or other document, certifying that the person before whom it was sworn or taken was duly authorised to administer oaths in the country in which it was sworn or taken, and such certificate must be signed by a British consul or vice- consul, or verified by the seal of the High Court or of a Local Court of Record of the said country."

Indeed, the learned Editor of Brooke's Treatise, 8th Edition, at p. 182 goes on to observe further and more clearly on this point in the following terms :

"Powers of attorney executed by foreign companies should, in addition to an affidavit verifying execution, have attached to them an affidavit, made preferably by a notary public before a British consular Official, proving (1) that the company is duly constituted and registered in accordance with the local law of the foreign country; (2) that A, B and , the signatories, are respectively directors and Secretary as the case may be, of the said company and (3) that the company is bound and engaged by the signatures of A, B and C, in accordance with the statutes or articles of association of the said company and the local law." Now all these formalities have been fully satisfied in the present case. Indeed, in that authority just quoted above RFA No. 583/2004 Page 38 of 71 again at pp. 52-53 certain decisions are noted. Out of those decisions, I shall select some as appropriate and relevant for the point under decision before this Court." (12) The Court also noticed the provisions of Section 14 of the Notaries Act and satisfied itself at first whether there is reciprocity of notarial acts of Notaries of India being recognised in U.S.A. and vice versa and it held that such a notarial act of Notary of U.S.A. is recognisable in India and thus, the said document is admissible in India. The Court also advised that it is high time that the Central Government should issue necessary notifications also under Section 14 of the Notaries Act. It is the contention of the learned counsel for the respondent that Notaries Act had not made illegal and well-established previous practice of recognising the notarial acts of Notaries of U.S.A. or England by the Indian Courts when such acts of Notaries of India are recognised by the said countries as well. Yogeshwar Dayal, J., in the case of National & Grindlays Bank (supra) has held such a power of attorney to be admissible in evidence and presumptions under Sections 57 & 85 of the Evidence Act were held to be available to such a document although he relied upon the case of Jugraj Singh (supra) for giving that finding. Sultan Singh, J., in Suit No. 671/77, Bank of India v. Ajaib Singh, decided on April 20:. 1979, (24) followed the above case for giving the same opinion. However, independently of these two decisions of two Judges of this Court, I hold that the provisions of Section 14 of the Notaries Act do not place any bar in recognising the notarial acts of such countries wherein the notarial acts of Notaries of India are recognised. Even in Abdul Jabbar & Others, : AIR1980All369 it was held that Section 85 of the Evidence Act applies equally to documents authenticated by Notaries Public of other countries and there is no reason to import the provisions of Notaries Act for interpreting the provisions of Section 85 of the Evidence Act. I agree with these observations. Hence, I repel this contention of the learned counsel for the appellant that the said power of attorneys endorsed by Notary Public of U.S.A. by themselves arc not admissible in evidence."

31. It would be thus seen from all the aforesaid judicial pronouncements that the Courts have been consistently taking a view that once the execution and authentication of the Power of RFA No. 583/2004 Page 39 of 71 Attorney by a Notary Public is proved on record, then Section 85 mandates the Court to draw a presumption in favour of due and valid execution of such a Power of Attorney. The Courts have also taken a view that the use of expression "authentication" in Section 85 of the Evidence Act must be accorded its due meaning, not merely comparing the same with the expression "attestation". The authentication of a Power of Attorney or any document by the Notary Public necessarily would mean that Notary Public has duly satisfied himself about the competence of the Officer and his authority to execute such a Power of Attorney or other document. The purpose of Section 85 has thus been rightly held to eliminate the cumbersome evidence which in the absence of the said provision on the statute book would be required to prove the minutes book and Board Resolution etc. for proving the due and valid execution of the Power of Attorney. Looking into the growing international trade and the world economy, any other interpretation of Section 85 of the Evidence Act would unnecessarily burden the parties to bring the witnesses from abroad just to prove the Board Resolutions and minute books etc. However, having said that, one cannot lose sight of the fact that such presumption is not a conclusive presumption as the same being rebuttable. Once a party RFA No. 583/2004 Page 40 of 71 who seeks to take advantage of Section 85 of the Evidence Act proves the Power of Attorney, its due execution and authentication by the Notary Public with due affixation of necessary seals on such a document then the onus would shift on the other party to disprove or rebut such a presumption arising in favour of the first party.

32. Now applying the aforesaid legal principles to the facts of the case at hand, on perusal of the trial court records, it does not appear that the respondents have filed the original Power of Attorneys. On perusal of the photocopies of the Power of Attorneys proved on record as Ex.PW-2/3 and PW-2/4, one would find that so far the Power of Attorney dated 27.03.1995 Ex.PW-2/3 is concerned, the same does not appear to be carrying a proper seal of the Notary Public although it does carry certification and authentication from the Notary Public. So far the Power of Attorney dated 22.03.1995 Ex.PW-2/4 is concerned, the same does carry the seal of the Notary Public and a notarial certificate certifying the execution and authentication of the said attorney by the Notary Public. Although the respondents ought to have filed the original Power of Attorneys, but since no objection to this effect was taken by the appellants herein either before the learned trial court or before this Court, therefore, such an objection can be taken to have been RFA No. 583/2004 Page 41 of 71 waived by the appellants. Now the question that arises for consideration before this court is that:

"Whether in the absence of a proper notarial seal on Ex.PW-2/3, can it be said that the respondents had successfully proved the said Power of Attorney so that the learned trial court could draw a presumption of its proper execution and authentication by the Notary Public as envisaged under Section 85 of the Indian Evidence Act?"

33. Under Section 57(6) of the Indian Evidence Act, the Court is empowered to take a judicial notice of due and valid affixation of seals by the Notary Public, but in the absence of any such notarial seal on the Power of Attorney Ex.PW-2/3, can the Court take a judicial notice of mere assertion in the notarial certificate disclosing affixation of such a seal? The answer certainly would be in the negative. The notarial seal for taking a judicial notice can arise only if actually such a seal has been affixed on such a document and not in the absence of the same. Not only the absence of the seal on the said Power of Attorney Ex.PW-2/3, the presumption as envisaged under Section 85 of the Indian Evidence Act in favour of due and authenticated execution of the said Power of Attorneys has been rebutted by the respondents themselves through their own evidence. It would be interesting to note the statement of PW1 Phillip Jackson, who in his cross-examination RFA No. 583/2004 Page 42 of 71 categorically deposed that there was no such notation in the Minutes Book and no such resolution for giving a Power of Attorney in connection with the filing of the said suits. For the sake of repetition, the said portion of cross-examination of the said witness is reproduced as under:-

"I have not brought any Minutes Book or any Resolution of Baker Hughes Incorporated authorizing filing of this action or for giving of the power of attorney in connection with this action. Vol. THERE IS NO SUCH NOTATION IN THE MINUTES BOOK AND NO SUCH RESOLUTION"

34. In view of such a categorical and candid statement of the respondents‟ own witness clearly disputing and denying passing of any Board Resolution and stating that there is no notation of the same in the Minutes Book of the respondents‟ company, this Court fails to comprehend as to how the learned Trial Court could draw a presumption under Section 85 of the Indian Evidence Act in favour of due and valid execution and authentication of the said Power of Attorney Ex.PW-2/4. Similarly, PW 2 R.Sampath Kumar in his cross- examination failed to give any clear or positive answer with regard to the existence of any Board resolution giving authority to the executants for the execution of the said two Power of Attorneys or for the institution of the suit in question. Relevant portion of the RFA No. 583/2004 Page 43 of 71 cross-examination of R.Sampath Kumar is again reproduced as under:-

"Q. Are you aware about any resolution of the Board of Directors for General Body of the plaintiff no.1 or plaintiff no.2 authorising the institution of the suit or granting the power of attorney for that purpose.
A. I do recall Board Resolution but I do not know the date of resolution.
I do not remember if any copy/certified copy of the Board Resolution has been placed on record or not. It is incorrect to suggest that there is no such resolution passed by plaintiff company on record. It is also correct that the power of attorney filed by Mr.Oberoi has not been attested by any Indian Counsellor Officer. I once went to Hongkong in 1989. I went there in connection with International Buyer Association Conference."

35. In the absence of any notarial seal on the Power of Attorney Ex.PW-2/3 and in view of the stand taken by the aforesaid two witnesses in their cross-examinations, this Court does not find any merit in the argument of counsel for the respondents that a presumption arose in favour of due execution and authentication of the said two Power of Attorneys proved on record as Ex.PW-2/3 and PW-2/4 as envisaged under Section 85 read with Section 57(6) of the Indian Evidence Act. Both the civil suits were signed, filed and verified by Mr.Sameer Oberoi based on the said two Power of Attorneys. The said suits have also been instituted by Mr.Sameer RFA No. 583/2004 Page 44 of 71 Oberoi on behalf of the respondents/plaintiffs based on the said two Power of Attorneys. It is not in dispute that Mr.Sameer Oberoi is neither the Director/ Secretary nor the Principal Officer of the respondent companies which could empower him to sign, file and verify the said two suits on behalf of the respondent-companies. Mr.Sameer Oberoi derives his entire power to sign, verify, file and institute the said two suits from the said two Power of Attorneys proved on record as Ex.PW-2/3 and PW-2/4 and not because of his having any independent capacity either as a Director of the Board of the two companies or in terms of Articles of Association of the respondent-companies.

36. Hence, in the light of the legal principles enunciated above , this Court is of the view that the appellants succeeded in rebutting the presumption and, therefore, the respondents cannot claim that they were entitled to the benefit of Section 85 of the Indian Evidence Act for raising a presumption for the due execution and authentication of the two Power of Attorneys proved on record as Ex.PW2/3 and PW2/4.

37. One of the arguments raised by counsel for the respondents was that there is a ratification clause in both the said RFA No. 583/2004 Page 45 of 71 Power of Attorneys and even if one Power of Attorney is to be held not proved on record as per law then ratification clause in the second Power of Attorney would ratify the acts of the attorney holder. In support of this argument, counsel for the respondents placed reliance on the judgment of the Apex Court in United Bank of India Vs. Naresh Kumar and Others (1996) 6 SCC 660. In my view however, this plea of ratification taken by counsel for the respondents would not attract to the facts of the present case, as it is not the case of the respondents that there was ratification of the previous acts of the attorney holder by some other officer or attorney holder later appointed by the company through some Board Resolution through which ratification of the previous acts of the attorney holder not validly constituted would cure the initial illegality on the principle of relation back. In the present case, Mr.Sameer Oberoi had signed, filed and verified both the suits based on the said two Power of Attorneys which were not proved by the respondent to draw a presumption under Section 85 of the Indian Evidence Act as discussed herein above and no other officer backed by any Board Resolution or on account of his own authority was produced by the respondents who could have ratified to validate the acts of the said attorney holder. The principle of law RFA No. 583/2004 Page 46 of 71 thus laid down in the said judgment of Naresh Kumar(supra) would not be attracted to the facts of the present case and, therefore, the same can be of no help to the case of the respondents.

38. Learned counsel for the respondents also argued that as per the true and proper reading of Issue No.1, the limited onus which the respondents were called upon to discharge was to prove the validity of the said two Power of Attorneys and not beyond that. Although the issue framed by the learned trial court is not happily worded, as in the preliminary objection raised by the appellants in their written statement they had challenged the very locus standi of Mr.Sameer Oberoi to sign, file and verify or institute the said suits besides challenging the legality of the Power of Attorneys, but as per the settled legal position, if both the parties went to trial knowing fully well the real issues involved and adduced evidence keeping in view their respective stands taken in the pleadings then it will not be open to a party to raise the question of non-framing of an issue in a particular form. Therefore, the respondents cannot raise the grievance at this stage that they were not fully conscious of the said objection taken by the appellants in their written RFA No. 583/2004 Page 47 of 71 statement. In any event of the matter, the respondents have failed to prove the said two Power of Attorneys so as to raise the presumption in their favour under Section 85 of the Indian Evidence Act and due to such failure on the part of the respondents, Mr.Sameer Oberoi had no authority to sign, file, verify and institute the said two suits on behalf of the respondent company.

39. Now, after having taken the said view that the respondents have failed to prove the said Power of Attorneys in their favour, the question that arises is that should the two suits filed by the respondents be dismissed on this ground alone? The answer to this can be found in the judgment of the Hon‟ble Apex Court in the case of United Bank of India Vs. Naresh Kumar (Supra). The Supreme Court in the said case has taken a view that it would be a travesty of justice if the appellant is to be non-suited for a technical reason which does not go to the root of the matter. Although the case before the Apex Court concerned the recovery suit filed by a Scheduled Bank and the Court took a view that where the suits are instituted or defended on behalf of public corporations, public interest should not be permitted to be defeated on a mere technicality. Even though in the present case before this Court the RFA No. 583/2004 Page 48 of 71 respondent is not a public body or corporation, but still considering the fact that on merits the respondents have succeeded before the learned trial court , therefore, the respondents should not be losing the ground merely on the said technicality of not proving the Power of Attorneys. It cannot be overemphasized that procedures are handmaids of justice and substantive rights cannot be allowed to be defeated just on account of any procedural irregularity or infirmity which is curable. Substantial rights cannot be and should not be allowed to be stultified on account of a procedural lapse.

40. In the light of the foregoing, this court is of the view that the present appeals thus deserve to be remanded to the learned trial court so as to give a fresh opportunity to the respondents to cure the said technical defect and the trial court shall permit the respondents to file any additional document so as to prove the issue No.1 and also to give fresh opportunity to the parties to lead their respective additional evidence to prove/dis-prove the issue No.1. The trial court may also re-cast the issue No.1 if found necessary, based on the additional documents/pleas raised by the parties or even otherwise.

RFA No. 583/2004 Page 49 of 71

41. The first two questions thus formulated herein above are answered accordingly.

42. Now I will deal with the other issues raised by counsel for the parties which are of no less importance than the controversy relating to the institution of suits.

QUESTION No. 3

43. The issue of dual capacity was raised by counsel for the appellants with all vehemence and was opposed with equal vociferousness by counsel for the respondents. The basic facts which are not in dispute are that the respondents No.1 and 2 had engaged the services of a solicitor company known as M/s.Remfry & Sagar and two Power of Attorneys were executed by the respondents No.1 and 2 nominating Advocates with their specific names who were working for the said solicitor company M/s.Remfry & Sagar, and amongst them were one Mr.Sameer Oberoi and one Mr.R.Sampath Kumar. It is also not in dispute that Mr.Sameer Oberoi had signed, filed and verified the two suits on behalf of the respondent companies based on the said two Power of Attorneys and Mr.R.Sampath Kumar had entered the witness box as PW-2 to RFA No. 583/2004 Page 50 of 71 give evidence on merits of the case on behalf of the respondent- companies. Clearly, Mr.R.Sampath Kumar being an Advocate working for M/s.Remfry & Sagar had also acted in a dual capacity of a client when he gave the evidence on behalf of the respondent- companies on the factual matrix of the case. The issue of dual capacity has been a subject matter of discussion in the past before various High Courts and the Bombay High Court in the landmark judgment of Oil and Natural Gas Commission vs. Offshore Enterprises Inc. AIR 1993 Bombay 217 has dealt with the issue of dual capacity much in detail. The questions formulated in the said case are worth re-production as this Court is also confronted with the same questions in the present case. The relevant extract is as under:-

". In this background, I formulated the following questions for consideration of this Court in this respect.
(i) Whether an Advocate is entitled to act as Constituted Attorney of a party with authorisation to sign the pleadings and affidavits on behalf of the suitor as well as to act and plead for the party concerned in the same litigation?
(ii) Whether the existing practice followed by firm of Advocates/Solicitors/Attorneys particularly in case of non-resident clients as aforesaid is in conformity with law and the recognised rules of professional ethics?

7. It is well settled law that the constituted attorney of a suitor has no right of audience in Court or to cross-examine witnesses. The RFA No. 583/2004 Page 51 of 71 Constituted Attorney is merely entitled to 'act' and 'appear' for a party but has no right to 'plead' in a Court. The expressions 'act' and 'appear' do not mean 'right to plead' as such. It has been so held by our High Court in the case of A.S. Patel v. National Rayond Corporation Limited, : AIR1955Bom262 . It is permissible for an Advocate to act as a 'recognised agent' or a Constituted Attorney by virtue of Power of Attorney executed in his favour by a suitor and sign vakalatnama pleadings and affidavits on behalf of the donor of Power of Attorney to the extent provided in the Code of Civil Procedure as aforesaid. In all such cases the signature of Constituted Attorney on pleadings, affidavits, vakalatnama and other documents is liable to be equated to signature of a party itself for all practical purposes. It follows that in all such cases the plaintiff or the defendant is deemed to have signed the pleading by the hand of his Constituted Attorney. The pleadings are required to be verified and declared by the signatory thereof with reference to personal knowledge of the averments made therein or on basis of information and belief. The question to be asked is as to whether an advocate who acts as Constituted Attorney of a suitor in pursuance of power of attorney from his client is entitled to combine his role of a constituted attorney with that of an advocate in the same cause simultaneously. Members of the Bar are governed by the provisions contained in the Advocates Act 1961, well known principles and doctrines recognised for generations and are rightly described as partner in Administration of justice. Advocates in their professional capacity are enjoined to act with complete impartiality and detachment and not entitled to identify themselves with the clients or the cause personally. The paramount duty of an Advocate is to assist the Court in its task of administering justice. In, the event of there being any conflict between interest and duty, the Advocate must yield in favour of his duty to assist the cause of fair and impartial justice. An Advocate is expected to be fair and reasonable towards his opponent. All these principles bind the Advocates in discharge of their professional duties. Advocates belong to noble profession of law. On the other hand, a constituted attorney is entitled to identify himself with the donor of Power of Attorney and act in the same manner as the suitor-litigant is entitled to act. An Advocate is governed not merely by written provisions of the Advocates Act 1961 but also by traditions of the Bar built up for generation during the course of administration of justice for centuries. It is provided by Order III Rule 4 of the Code of Civil Procedure that a vakalatnama should be signed by the party or by his recognised agent in favour of the pleader. The question to be asked illustratively is as to whether the pleader acting in his capacity as constituted attorney of a litigant can sign such vakalatnama as a client in his own favour as an Advocate or in favour of the firm in which such constituted attorney himself is one RFA No. 583/2004 Page 52 of 71 of the partners. The answer is in negative. The question to be asked is as to whether the two roles can be combined? The question to be asked is as to whether it is not inherent in the scheme and the provisions of Code of Civil Procedure and implicit in the provisions contained in Order III Rule 4 of the Code of Civil Procedure and other connected provisions that advocate who acts or appears or pleads before the Court in a professional capacity must have a client with separate and distinct identity. The answer to these questions is obvious. For all practical purposes, the recognised agent of a suitor is on par with the suitor or client himself; an Advocate is not, as an Advocate is an independent person with a specific role in administration of justice. In certain situations advocates are permitted to accept power of attorneys from a client for purpose of acting in a suit or matter, sign pleadings, vakalatnama and affidavits on behalf of plaintiff or defendant as case may be. An Advocate may be appointed as a Receiver in a suit or a cause. No one can object to the Advocate accepting these assignments permissible under the law. The question still remains as to whether the advocate who is holding a power of attorney from a client to act and appear in a suit or matter can also act in the professional capacity in the same proceedings at the same time. The answer to this question is too obvious and has to be in negative. Detachment and impartiality expected of an Advocate is likely to be jeopardised when an Advocate acts in both the capacities. The risk in allowing combination of two roles is far too serious. I must therefore, construe the Code of Civil Procedures harmoniously and in a manner so as to prevent confusion, anomaly and misunder-standing. In my opinion, law does not permit the combination of two capacities in the same cause. Law prohibits such combination and rightly so.

8. It is unfortunate that a totally wrong practice has grown up in our Court where one or the other partner of a solicitors' firm signs pleadings and affidavits on behalf of a foreign client in pursuance of authorisation contained in the power of attorney and the same firm of Advocate/Solicitors acts, appears and pleads in a professional capacity. The said practice is not sanctioned by law. To my mind such a practice is opposed to law.

On principle, the Advocate cannot act in dual capacity and cannot be a mixture of two characters. No express provision is required to be enacted in this behalf. With great respect, the implication from the scheme of the Code interpreted in light of well recognised rights and obligation of the Bar is too obvious. It is unfortunate that the wrong illegal practice referred to in opening part of this order and the questions formulated by the Court has continued so far. RFA No. 583/2004 Page 53 of 71 .......

10. It is not sufficient that an Advocate acts impartially. It is also necessary that the Advocate must always appear to act impartially. The basic principle of acting impartially and mere representation of a client consistent with duty to opponent and Court keeping reasonable distance from arena of conflict would be jeopardised if the Advocate acts in professional and non-professional capacity both in the same matter and at the same time. Practices and procedures of the Court must serve the administration of justice and rule of law in keeping with its noble ideals, traditions and objectives. The Court are required to interpret various provisions of various Acts and rules in manner so as to avoid anomalies as far as possible. Shri Ajit P. Shah, the learned counsel for the Bar Council has invited attention of the Court to the fact that a constituted attorney is entitled to identify himself with the interest of his client and give instruction to the Advocate representing the client before the Court. It would be strange if the lawyer constituted attorney gives necessary instruction in the matter to himself or his co-partners. Taking an overall view of all the relevant provisions pointing out to the Court and their objectives as indicated above, I have no hesitation in accepting each of the submissions urged on behalf of Bar Council of Maharashtra and Goa and interpret the relevant provisions so as to infer prohibition of combination of two capacities by necessary implication.

11. It makes no difference that the power of attorney is executed in favour of one or other partner of the firm of the Advocate and the litigation is in fact conducted by another partner of the advocate's firm. If the vakalatnama is executed by a client in favour of firm of advocates it follows that all the partners of the said firm are engaged as Advocates by the client concerned. It makes no difference to the situation that the vakalatnama is accepted in writing only by one of partners of the firm. All the partners need not place their signatures on the vakalatnama. Each and every partner of Advocates' firm is enjoined to act in such cases in professional capacity or no other capacity. No conflicting role can be assumed by one or other partners of the same firm in respect of the same cause or the matter.

12. There is an additional facet. On close scrutiny of Order III Rule 4 of the Code and other connected provisions, I hold that an Advocate acting in professional capacity must be independent of the suitor or his constituted Attorney. Rule of professional ethics framed by the Bar Council clearly provide in terms that no one can accept a brief or appear as an advocate if he is likely to be a witness in the case. RFA No. 583/2004 Page 54 of 71 Affidavits may be filed under Order XIX Rule 2 of the Code of Civil Procedure. On several occasions Affidavits are filed, by the constituted attorney of the suitor. Pleadings can be signed and verified by a Constituted Attorney. Once the constituted attorney of a suitor files an affidavit, he can be summoned by the Court at the instance of other side or suo motu for cross-examination. The very possibility of the advocate holding power of Attorney being summoned as a witness in such cases is sufficient to infer implied prohibition on combination of two capacities. Rule 13 of the rules of Bar Council cannot be treated as exhaustive. The said rule is illustrative and does not take care of all situations. Even if an Advocate is not likely to be called as a witness, he cannot combine the two roles as discussed above. I find considerable force in each of the submissions made by Shri Ajit P. Shah on behalf of the Bar Council of Maharashtra and Goa. I accept each of the submissions made on behalf of Bar Council. Practice prevailing in our Court in case of foreign or non-resident clients whereby the Advocates' firm acts in a professional capacity and one or two partners of the same firm obtain power of Attorney with authorisation to sign pleadings and affidavits etc. is opposed to law as aforesaid. It is not possible to put judicial imprimatur on such a practice. Even if no personal affidavits are filed by the Advocate concerned in pursuance of the power of Attorney, the Advocate cannot combine the two capacities and the two roles.

............

15. In view of above I therefore, answer the questions formulated by the Court at the commencement of hearing of this proceedings as under :--

(a) An Advocate is not entitled to act in a professional capacity as well as constituted attorney of a party in the same matter or cause. An Advocate cannot combine the two roles. If a firm of Advocates is appointed as Advocates by a Suitor, none of partners of the Advocates' firm can act as recognised agent in pursuance of a power of attorney concerning the same cause.

(b) The existing practice followed by the firm of advocates/solicitors/attorneys particularly in case of non-resident clients combining the two roles is opposed to law and is required to be discontinued forthwith.

(c) The Prothonotary and Senior Master, High Court shall not accept any vakalatnama in favour of a firm of advocates where one or the other partner of the same firm also holds a power of attorney from RFA No. 583/2004 Page 55 of 71 the plaintiff or the defendant or any other suitor before the Court in the same cause."

44. The Hon‟ble Supreme Court in the case of Janki Vashdeo Bhojwani and Anr. Vs. Indusind Bank Ltd. and Ors. AIR 2005 SC 439, while interpreting the scope of Order 3 Rule 1 CPC, clearly took a view that the attorney cannot depose for the principal for the acts done by the principal and not by him and similarly he cannot depose for the principal in respect of the matter which only the principal can have the personal knowledge and in respect of which the principal is entitled to be cross-examined. Relevant para of the said judgment is reproduced as under:-

"12. In the context of the directions given by this Court, shifting the burden of proving on the appellants that they have a share in the property, it was obligatory on the appellants to have entered the box and discharged the burden by themselves. The question whether the appellants have any independent source of income and have contributed towards the purchase of the property from their own independent income can be only answered by the appellants themselves and not by a mere holder of power of attorney from them. The power of attorney holder does not have the personal knowledge of the matter of the appellants and therefore he can neither depose on his personal knowledge nor can he be cross-examined on those facts which are to the personal knowledge of the principal.
13. Order III, Rules 1 and 2 CPC, empowers the holder of power of attorney to "act" on behalf of the principal. In our view the word "acts" employed in Order III, Rules 1 and 2 CPC, confines only in respect of "acts" done by the power of attorney holder in exercise of power granted by the instrument. The term "acts" would not include deposing in place and instead of the principal. In other words, if the power of attorney holder has rendered some "acts" in pursuance to power of RFA No. 583/2004 Page 56 of 71 attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for the acts done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter which only the principal can have a personal knowledge and in respect of which the principal is entitled to be cross-examined."

45. This court was also faced with a similar situation of the Advocates acting in dual capacity in the case of Columbia Pictures Industries, Inc vs. Siti Cable Network Ltd., 94 (2001) DLT 177, where a Division Bench of this Court, while taking the same view as taken by the Bombay High Court in ONGC case(supra) on its principle, but differed on the facts as in the case before the Division Bench it was found on facts that the Advocate who was alleged to have been acting in dual capacity had nothing to do with the sole proprietorship firm of the solicitor company and, therefore, he was held to be discharging independent roles in different capacities. Relevant paras of the said judgment are reproduced as under:-

"7. Unfortunately the learned Single Judge has not gone into these factual aspects. We are sure that if these facts were considered by the learned Single Judge, the result would have been different. The above facts in our view clearly show that two independent persons are performing two different roles so far as the present case is concerned.

While Ms.Dahlia Sen Oberoi is the constituted attorney of the plaintiffs, Mr. Chander M. Lall is the advocate to conduct the case on behalf of plaintiffs in his professional capacity. The roles of the two persons are clearly different and do no merge at all. There is no scope for saying that in the present case the advocates are acting in a dual RFA No. 583/2004 Page 57 of 71 capacity. The identity of the two persons is clearly distinct and separate. It is a different matter that both of them happen to be advocates. There is no legal bar to an advocate being appointed as a constituted attorney by party was herself to act and plead as an advocate, her conduct could be said to be questionable but so far as facts of this case which have been brought to our notice are concerned, the two personalities have maintained the distance, they have not allowed their roles to merge at any point of time.

8. The learned counsel for the respondent relied on Oil and Natural Gas Commission V. Offshore Enterprises Inc., 1993 Bombay 217. On law there is no quarrel with the legal proposition enumerated in the said judgment. This was a case in which a lawyers' firm which was a partnership had accepted both the roles, i.e., of a constituted attorney as well as an advocate. In a partnership, apart from the relevant rules of the Bar Council of India or the Bombay High Court, to the effect that each partner of a law firm will be treated as an advocate in the case, the Partnership Act itself creates such a hurdle. In a partnership each partner is an agent of the other and, Therefore, even in the absence of relevant rules of the Bar Council or a High Court, the legal consequence would be that all partners of a law firm would be deemed to be counsel in the case. The judgment of the Bombay High Court, however, has no application in the facts of the present case because the present is not a case of partnership. M/s. Lall and Sethi is not a partnership firm though the name may suggest it to be so. There is sufficient material on record or dispel the belief that it is a partnership firm. It is a sole proprietorship of Mr. Chander M.Lall. Ms.Dahlia Sen Oberoi has nothing to do with it except that she may be using the firm's address as an address for herself or she may be associating with Mr. Chander M.Lall in some legal work on a case to case basis.

9. It follows from the above discussion that there is no warrant for holding that Mr. Chander M.Lall or Ms. Dahlia Sen Oberoi or for that matter either of them is acting in a dual capacity in the facts of the present case. Both have independent roles so far as the present case is concerned. The impugned order which has no factual basis to sustain it, is hereby set aside. The plaint is restored to its position as it prevailed at the time of passing of the impugned order. It further follows that the interim orders which were in force at the time of passing of the impugned order will stand revived and continue of operate. This appeal is disposed of in these terms. No order as to costs."

RFA No. 583/2004 Page 58 of 71

46. In the wake of globalization and increasing international trade, India has become one of the biggest commercial hubs which has consequently led to a spurt in the volume of litigation in the country, making the Indian legal fraternity a much sought after lot. It is undoubtedly a golden period for the lawyers and law firms in India which are being engaged by the foreign companies and multinationals, but at the same time it has but brought an insalubrious trend, that of the lawyers wearing two hats; of an attorney and of a client at the same time. The Advocates Act, 1961 and The Bar Council of India Rules prescribe rules for professional conduct and ethics for lawyers. Rule 13 of the Bar council of India states that:

"13. An Advocate should not accept a brief or appear in a case in which he has reason to believe that he will be a witness, and if being engaged in a case, it becomes apparent that he is a witness on a material question of fact, he should not continue to appear as an advocate if he can retire without jeopardizing his client's interest."

Thus as is manifest from the said rule, it would be a professional misconduct if a lawyer were to don two hats at the same time. However not only that, the partnership firms have a hurdle for acting in the said two capacities even under The Partnership Act, as RFA No. 583/2004 Page 59 of 71 every partner in a partnership firm is an agent of another and if one were to be acting as an advocate for a client, the rest would also be in the same capacity by virtue of agency and the same would be the situation in case of a an advocate acting as a client. However, it cannot be forgotten by any who has ever been graced with the honour of wearing the robe that the lawyer is first an officer of the court and his prime duty is to assist the court in the administration of justice. The rules of conduct as per the Bar Council Of India Rules may act as a guardian angel for ensuring the moral conduct of the lawyers but the legacy of the traditions of the Bar cannot be bedaubed by a few for the lucre of commercial gains. A lawyer cannot forget that this is called a noble profession not only because by virtue of this he enjoys an aristocratic position in the society but also because it obligates him to be worthy of the confidence of the community in him as a vehicle of achieving justice. The rules of conduct of this profession with its ever expanding horizons are although governed by the Bar Council of India Rules but more by the rich traditions of the Bar and by the cannons of conscience of the members of the calling of justice of being the Samaritans of the society. Thus the foreign companies and firms must respect the RFA No. 583/2004 Page 60 of 71 laws of this land and the solicitors and law firms are equally not expected to discharge their duties as clients for these foreign companies/firms. Law is not a trade and briefs no merchandise and so the avarice of commercial gains should not malign this profession. Hence there can be no divergent view on the legal proposition that an Advocate cannot act in the dual capacity, that of a constituted attorney and an advocate.

47. Reverting back to the facts of the present case, Mr.R.Sampath Kumar along with Mr.Sameer Oberoi and four other Advocates working for M/s.Remfry and Sagar were appointed as attorneys by both the respondent companies to file, prosecute and conduct civil proceedings before any court, authority or tribunal of appropriate jurisdiction in India against Mr.Hiroo Khushalani and Baker Oil Tools (India) Pvt. Ltd. In the said Power of Attorneys, nowhere it has been stated that what was the capacity of Mr.R.Sampath Kumar in the said Solicitor concern i.e. M/s.Remfry and Sagar, was he partner in the said solicitor concern or was attached with the said company as a junior advocate or was attached with the company to represent the clients in specified assigned cases. Mr.R.Sampath Kumar in his examination-in-chief RFA No. 583/2004 Page 61 of 71 filed through an affidavit did not disclose his exact status (page 1244 of LCR) in the said solicitor concern of M/s. Remfry and Sagar. He merely stated that he had full and easy access to the records of the respondents/plaintiffs relating to the case and conversant with the facts and circumstances of the case and also that Mr.Sameer Oberoi used to work with him in M/s.Remfry and Sagar where he had seen him signing and writing. Mr.R.Sampath Kumar has deposed on behalf of the respondents as one of the key witnesses and through his deposition and deposition of PW-1 Philip Jackson, the respondents have sought to prove their case. In his cross- examination, Mr.R.Sampath Kumar took a stand that he was working as a partner with M/s. Remfry and Sagar company and he was deposing as a witness in his capacity as a partner of the said company. He also deposed that so far Mr.Sameer Oberoi is concerned, he was associated with M/s.Remfry and Sagar in his capacity as a lawyer and he was obtaining retainer-ship fee for the same. He also deposed in his cross-examination that earlier he was in service as full time assistant in M/s.Remfry and Sagar concern in the year 1984 and in the year 1994 as well. Thus, Mr.R.Sampath Kumar had filed his evidence by way of an affidavit dated 14.7.2004, while he was cross-examined on 13.9.2004. In his entire RFA No. 583/2004 Page 62 of 71 evidence, no specific question was put to him as to when he had joined the said solicitor company in his capacity as assistant or as to when he had become the partner in the same. During the course of his arguments, Mr.Ajay Gupta, learned senior counsel for the respondents took a stand that M/s. Remfry and Sagar company was the sole proprietorship concern of Dr.Vidya Sagar and the same became a partnership firm comprising of Dr.Divya Sagar, R.Sampath Kumar, Mr. Prem Sewak, Mr.Ashwin Julka and Mr.Ramit Nagpal w.e.f. 01.06.2001. The respondents have also taken a stand that at the time of institution of the suits in the year 1995, neither Mr.Sameer Oberoi nor Mr.R.Sampath Kumar were partners of M/s. Remfry and Sagar and, therefore, the suits which were good in the eyes of law in the year 1995 cannot become bad in the year 2001 merely because of the reason of the said sole proprietorship firm becoming a partnership firm. Mr.R.Sampath Kumar in his cross- examination has also not denied the fact that he was a partner in the said solicitor company. He did not disclose as to when he became a partner therein and from which period to which period he was an associate in the said concern. Whether Mr.R.Sampath Kumar was a partner in the year 1995 at the time of institution of the suits or not is at least not clear from the evidence adduced by the RFA No. 583/2004 Page 63 of 71 respondents. The appellants also did not take any pains to find out through the cross-examination of Mr.Sameer Oberoi and Mr.R.Sampath Kumar as to what was their exact status in the said solicitor company at the time of institution of the suits. It is only at the stage of the appeal, that too at the stage of arguments, that the counsel representing the appellants has taken the plea of the said advocates of M/s.Remfry and Sagar acting in dual capacity i.e. in the capacity of a client as well as a lawyer. This question of whether a person at the relevant time had dual capacity or not is a mixed question of law and fact and is not a pure question of law which can be raised for the first time in appeal. The Hon'ble Division Bench of this Court in Columbia Pictures Industries (supra), while upholding the principles laid down in Oil and Natural Gas Commission (supra), distinguished the said judgment of the Bombay High Court, where they found sufficient material on record to dispel the belief that the solicitor company was a partnership firm the same being sole proprietorship firm of M/s. Chander and Lall and Ms. Dahlia Sen Oberoi had nothing to do with the said solicitor company except that she was using the firm‟s address as address for herself or she was associated with the said company in some legal work on case to case basis. Another fact which is worth RFA No. 583/2004 Page 64 of 71 noticeable is that in the facts before the Division Bench, an application was moved by the defendants to seek rejection of the plaint on the ground that an advocate is not entitled to act in dual capacity i.e. as a constituted attorney of the plaintiffs as well as an advocate to plead the case of the plaintiffs in court. No such application was moved by the appellants before the trial court in the present case at any stage. Even no specific plea has been raised by the appellants in the first appeal for consideration. It is only during the course of arguments that the counsel raised the plea of the said advocates Mr.R.Sampath Kumar and Mr.Sameer Oberoi acting in dual capacity. Thus this is a mixed question of fact and law and when factual contentions required for this purpose were not raised at the earliest opportunity i.e. before the learned trial Court, no such contentions can be permitted to be raised now at the stage of appeal, more so when no such foundation has even been laid before the trial Court either in the form of averments made in some application or in the form of evidence before the Court. The said contention therefore, deserves to be rejected.

48. In the light of the foregoing, this Court is of the view that the plea raised by the appellants challenging the RFA No. 583/2004 Page 65 of 71 maintainability of the suit filed by the respondents on the principles of dual capacity merits outright rejection, the same being a mixed question of law and fact and raised for the first time at the stage of appeal. This view, however, will not debar the appellants to otherwise attack the evidence led by Mr.R.Sampath Kumar on the principles of law as envisaged under Order 3 Rules 1 & 2 CPC. Hence the Question No.3 framed hereinabove is answered accordingly.

QUESTION No.4

49. Now coming to the issue raised by counsel for the respondents that the appellants are estopped from challenging the maintainability of the said suits by the principles of constructive res judicata due to lack of competence of the said two power of attorney holders not earlier challenged by the appellants when the suits had travelled twice to the Hon'ble Supreme Court, this Court is of the view that the appellants have every right to challenge the maintainability of the said suits on this ground in the first appeal and the mere fact that in the interregnum the matter had travelled upto the Supreme Court at the interlocutory stage would not debar the appellants to raise the said plea in the first appeal. RFA No. 583/2004 Page 66 of 71

50. The doctrine of constructive res judicata as envisaged under Section 11 (iv) of the Code of Civil Procedure rests on the principles that one should not be vexed twice for the same cause and there should be finality to the litigation. Once the issue or fact has been judicially determined finally between the parties by a court of competent jurisdiction and the same issue comes directly in question in subsequent proceedings between the same parties then the persons cannot be allowed to raise the same question which already stands determined earlier by the competent court (as held in Amarendra Komalam & Anr. Vs. Usha Sinha & Anr. AIR 2005 SC 2758). Explanation 4 to Section 11 defines constructive res judicata. It further explains the said principle of res judicata to the extent that even the matter which might or ought to have been made a ground of attack or defence in the former suit but it was not done so by any of the parties will also be deemed to have been a matter directly or substantially in issue in such suit and the rule of res judicata will equally apply to it. It is no more res integra that the principle of res judicata applies at various stages of the same suit. Dealing with the concept of constructive res judicata, the Hon‟ble Supreme Court in Kewal Singh Vs. Lajwanti AIR 1980 SC 161 held as under:-

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"................as regards the question of constructive res judicata it has no application whatsoever in the instant case. It is well settled that one of the essential conditions of res judicata is that there must be a formal adjudication between the parties after full hearing. In other words, the matter must be finally decided between the parties. Here also at a time when the plaintiff relinquished her first cause of action the defendant was nowhere in the picture, and there being no adjudication between the parties the doctrine of res judicata does not apply."

51. In Konda Lakshmana Bapuji Vs. Govt. of Andhra Pradesh AIR 2002 SC 1012, explaining the said concept, the Hon‟ble Supreme Court in the following para observed as under:-

"23. In this context the following submission, pressed by Mr.Parasaran,may be considered here. He argued that the High Court in the Writ Petition filed by the appellant challenging the validity of the notice of eviction under the Land Encroachment Act, gave liberty to the first respondent to establish its title in Civil Court, which was also confirmed by the Division Bench in the writ appeal filed by the first respondent, although before the date of the disposal of the writ appeal the Act had come into force on September 6, 1982, the first respondent did not seek liberty from the Court to approach the Special Court, therefore, on the principle of "might and ought" he was barred by the principle of res judicata. Section 11 of the Code of Civil Procedure incorporates the principles of res judicata which, in short, means a matter which has already been adjudged judicially between the same parties. In substance, Section 11 bars a Court from trying any suit in which the matter directly and substantially in issue has been directly and substantially in issue in a former suit between the same parties in a court and has been heard and finally decided by such Court which is competent to try such subsequent suit or the suit in which such issue has been subsequently raised. Eight Explanations are appended to it. We are concerned with Explanation IV which embodies the principle of constructive res judicata and says that any matter which "might and ought" to have been made a ground of defence or attack in such former suit shall be deemed to have been a matter directly and substantially in issue in such suit. A RFA No. 583/2004 Page 68 of 71 conjoint reading of Section 11 and Explanation IV shows that if a plea which might and ought to have been taken in the earlier suit, shall be deemed to have been taken and decided against the persons raising the plea in the subsequent suit."
52. Taking note of the aforesaid legal principles, the question that arises for consideration is that:
"Whether the appellants could have raised the issue of attacking the maintainability of the suit filed by the respondents/plaintiffs on the ground of lack of competence of attorney holder in filing the said suits at the stage when the matter had travelled twice to the Hon'ble Supreme Court?

53. It is not in dispute between the parties that the matter went to the Hon‟ble Supreme Court at the stage of seeking injunction under Order 39 rule 1& 2 and at that stage only challenge was made to the decision of the learned trial court on the interim application. Certainly, at the stage of interim application when the issues were not even framed by the learned trial court, no attack on the maintainability of the suits, that too which require adjudication of facts could have been made by the appellants. It is only when the trial court has given its finding on the Issue No.1 that the said finding could be challenged by the appellants in the appeal and there was no occasion for the appellants to have challenged the RFA No. 583/2004 Page 69 of 71 maintainability of the suits at the interlocutory stage even if the matter had travelled upto the Supreme Court.

54. This court therefore does not find any merit in the said objection raised by counsel for the respondents that the appellants cannot raise the issue of attacking the maintainability of the suits on the ground of lack of competence of the attorney holder in filing the suits on the principles of constructive res judicata at the stage of first appeal. The judgment of the Hon‟ble Supreme Court cited by the counsel for the respondents in the case of Hope Plantations Ltd. Vs. Taluk Land Board, Peermade & Anr (1999) 5 SCC 590 is not applicable to the facts of the present case.

55. The question No.4 as formulated hereinabove is accordingly answered in the negative.

56. Now having decided the said four questions as formulated at the beginning, the cumulative effect of the same is that the matter is remanded back in terms of the directions given in para 40 herein above. Parties are directed to appear before the learned trial court on-----------------.

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57. In the light of the above, the appeals are accordingly disposed of on Issue No.1.

June 03, 2011                          KAILASH GAMBHIR, J
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