SOUMEN SEN,J. - (1.) This is an application for deletion of the names of the defendant nos. 2 to 6. The suit is filed against a public company in which the defendant nos. 2 to 6 are the Directors and the principal officers. The suit is based on a contract. The plaintiffs have sued the defendant No. 1 on a contract. The plaintiffs alleged that the company has made declarations which are false and consumed the iron ore for purposes other than domestic consumption. This is in breach of various circulars forming part of the contract. On such allegation, the plaintiffs filed the suit in which the plaintiffs have impleaded the principal officers of the defendant No. 1. In paragraphs 30 and 32 of the plaint the plaintiffs have alleged that the defendant No. 1 company at the instance of its Board of Directors having control over the day-to-day management and activities of the company have deliberately evaded the payment of legitimate Railway freight by obtaining lower freight rate on providing inaccurate, false and misleading information on oath to Railway Authorities. As such, the defendant No. 1 and the directors thereof have rendered themselves jointly and severally liable for evaded freight along with incidental additional charges. Defendant nos. 2 to 6 being the directors of the defendant No. 1 company have exercised their control over the affairs of the defendant No. 1 company and accordingly, are jointly as well as severally liable and responsible for payment of the evaded quantum of freight.
(2.) Mr. Hirak Kumar Mitra, learned senior counsel appearing on behalf of the applicants has submitted that the suit is based on contract and if any one is responsible under the contract, it is the defendant No. 1 which is a juristic entity and the principal officers individually have no liability to discharge nor they are individually liable. The principal officers are neither necessary nor proper parties in such a suit. 3. Mr. Mitra refers to two unreported decisions in this Court namely, Union of India and Anr. v. M/S. Rashmi Metaliks Limited and Ors. and Union of India and Anr. v. Rashmi Ispat Limited and Ors. , one of which was decided by this Court namely, GA No. 577 of 2015 which is as follows: "This is a suit for recovery of money against the defendant No. 1. In the said suit an application has been filed by the defendant Nos. 2 to 5 for dismissal of the suit against the said defendant Nos. 2 to 5; in the alternative the petitioners have prayed for deletion of their names. Mr. Sabyasachi Chowdhury, learned Advocate appearing on behalf of the applicant submits that a bare perusal of the plaint would show that no relief is claimed against the said defendants inasmuch as in law, the plaintiffs cannot have any cause of action against the said defendants. It is submitted that the plaint does disclose any cause of action against the defendant Nos. 2 to 5. Per contra learned Counsel appearing on behalf of the plaintiff submits that the defendant Nos. 2 to 4 are the Directors of the company and the defendant No. 5 is the company Secretary of the defendant No. 1 who is vested with the powers and functioning of the day-today activities of the defendant No. 1 company. It is stated in the plaint that the said defendants are jointly and severally liable along with defendant Nos. 2 to 4 for every action of the defendant No. 1 company. It is a well-settled principle of law that a company is a juristic entity. A company acts through its various organs. Unless there is a pleading to the effect in the plaint that the said defendants are personally liable in relation to the transactions and are guilty of committing fraud, the said persons individually in the capacity as director or secretary could be impleaded as a party in the suit. Order XXXIX of the Code of Civil Procedure refers to suit by or against corporations. It states that in a suit by or against a corporate entity any pleading may be signed or verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is liable to depose to the facts of the case. It further provides that subject to any statutory provisions where a suit is against a corporation, the summons may be served upon the secretary or any director or any principal officer of the corporation. Code of Civil Procedure does contemplate that in a claim against a company, individual directors or secretary are required to be made parties. Merely that a service of the writ of summons can be effected upon the secretary or the director of a company, does make the said person a necessary or a proper party in the proceeding." 4. In similar vein, Justice Banerjee in His Lordship's Order dated 5th October, 2006 has stated that the principal officers are not necessary parties. There cannot be an absolute proposition that in a suit of this nature, the principal officers may not be liable at all but for that necessary pleadings are required. It is well settled that in case of economic tort involving fraud and evasion of duties in an appropriate situation, the directors may be held liable which would be tortuious and not strictly regulated by the contract. In absence of any such pleading I am prepared to accept the submission made on behalf of the applicants that the plaint does not disclose any cause of action against the defendant nos. 2 to 6. 5. Under such circumstances, the names of the defendant nos. 2 to 6 shall be deleted from the plaint. The application succeeds. 6. The department shall delete the names of the said defendants within a period of two weeks from date. 7. Since no affidavit is called for, allegations made in the petition are deemed to have been denied.;