The Supreme Court in Udit Narain Singh v. Board of Revenue, AIR 1963 SC 786, while pointing out the difference between the necessary and proper parties.
Who is necessary party ?
The necessary party is one in whose absence no order can be made effectively,
Who is proper party ?
The proper party is one in whose absence an order can be made but whose presence is necessary for a complete and final decision on the question involved in the proceeding.
To summarise, necessary parties are all persons who have an interest in the subject matter of the suit. Their presence before the court is essential for determination of all the issue involved in the suit, and to settle the dispute finally. Without their presence before the court there cannot be an effective settlement of the dispute and complete adjudication of. all the issues involved.
Proper parties are those persons, whose presence before the court, though is not essential, yet it may be proper that they also be present before the court and adjudication on issues and settlement of the dispute is done in their presence. In the absence of proper parties, the suit is not defective and cannot be thrown away.
But in the absence of a necessary party a suit is defective, and if after the defect has been noticed and time granted by the court for removal of the defect and for impleading the necessary parties, the same is not done, the suit is defective and may be thrown away.
