Gajendra Narain Singh Vs. Johri Mal
Prahlad Rai [1962] INSC 310 (13 November 1962)
SHAH, J.C.
GAJENDRAGADKAR, P.B.
WANCHOO, K.N.
GUPTA, K.C. DAS
CITATION: 1964 AIR 581 1963 SCR Supl. (2) 303
ACT:
Execution-Partnership firm-Summons on
individual partner- Maintainability-Code of Civil Procedure 1908 (Act V of
1908), Or. 30, rr. 6, 7; Or. 21, r. 50.
HEADNOTE:
The respondent-plaintiff sued the firm of
M/s. Tirhut Umbrella Works in the Bombay City Civil Court for a decree for Rs.
20,320/. The summons in the suit was served on the appellant as a partner of
the firm. The appellant appeared in the Civil Court through ;in advocate
without protest and obtained an adjournment for filing a written statement.
Later the advocate sought leave to withdraw
the appearance on the ground that the appellant was not a partner of the firm
but the application was rejected by the court which proceeded to try the suit
ex-parte and decreed it as prayed for. The decree was transferred for execution
to the District Court, Patna, where the respondent first applied for leave to
execute the decree against the appellant but later wanted to proceed with the
execution without leave.
The District Court held that the appellant
was not a partner and that as the City Civil Court had not decided, that
question, it was open to the executing court to decide it.
On appeal, the High Court reversed the order
and directed the execution to proceed against the appellant.
Held, that on the evidence on record and in
view of the appellant not having produced the original summons served upon him
it must be held proved that the appellant had been served as a partner of the
firm and had appeared under rr, 6 and 7 of Or. 30 of the Code of Civil
Procedure. The District Court by refusing leave to withdraw on the ground that
the appellant was not a partner the City Civil Court had impliedly decided that
the appellant was a partner and there not having been any appeal against that
decision, the order was final and the decree could be executed against the
appellant under Or. 21, r. 50 Civil Procedure Code.
CIVIL APPELLATE JURISDICTION : Civil Appeal
No. 268 of 1960.
31 Appeal from the judgment and order dated
September 5, 1958, of the Patna High Court in Misc. Appeal No. 252/55.
A. V. Viswanatha Sastri, Yogeshwar Prasad and
U. P. Singh, for the appellant.
G. S. Pathak, Rameshwar Nath and S. N.
Andley, for the respondents.
1962. November 13. The judgment of the Court
was delivered by SHAH, J.-M/s. johri Mal Prahald Rai-hereing after referred to
as 'the plaintiffs'-commenced an action against M/s. Tirhut Umbrella Works (a
firm carrying on business at Laheriasarai in the State of Bihar) in the City
Civil Court, Bombay, for a decree for Rs. 20,320/- with costs and interest.
Summons of the suit was served upon one Gajendra Narain Singh-hereinafter
referred to as 'Singh'-at Road 8, R Block at Patna (Bihar) as a partner of the
defendant firm.
Mr. D. B. Tilak an advocate who was engaged
by Singh, filed on April 22, 1953 in the Court a Vakalatmama signed by Singh
authorising him to act, appear and plead in the suit. A chamber summons for
directions for trial of the suit as a commercial cause was thereafter served on
Singh. On September 9, 1953 Mr. Tilak a, advocate for Singh addressed a letter
to the Attorneys of the plaintiffs requesting them to consent to an
"adjournment of the x x x suit" to enable Singh "'to file his
written statement." By consent of the advocates the chamber summons for
directions stood adjourned by order of the Court for a fortnight. When the
chamber summons for directions was taken up for hearing on September 24, 1953
Mr. Tilak informed the Court that his client Singh claimed that he was not a
partner of the defendant firm, and orally prayed for an order permitting withdrawal
of the appearance filed in Court. The Court declined to accede to the oral
request and directed that appropriate proceedings to withdraw the 32 appearance
may, if so advised, be taken by Singh. The Court directed that the suit be
transferred to the list of commercial causes and gave directions for the
progress of the suit. When the suit was taken up for hearing before the City
Civil Court on November 27, 1953 Mr. Tilak again appeared and submitted that
his client on whom summons was served in the suit, was not a partner of the
defendant firm and prayed that he be allowed to withdraw the appearance which
was filed without protest. The Court rejected the application for leave to
withdraw the appearance and also rejected the application of Mr. Tilak for an
adjournment of the suit. Mr. Tilak then withdrew from the suit with leave of
the Court, and the suit was heard ex parte. The Court recorded the evidence of
a witness for the plaintiffs and admitted certain correspondence tendered by
the plaintiffs, and decreed the suit as prayed.
The decree was forwarded by the-Registrar of
the City Civil Court, Bombay to the Court of the District Judge, Patna, with a
certificate of non-satisfaction. The plaintiffs then applied for leave to
execute the decree against Singh under O. 21, rule 50(2) of the Code of Civil
Procedure. Singh contended that he was not a partner of the defendant firm and
that he was not liable to satisfy the debts of that firm; that he was not
'served with summons in the suit; that he had appeared in the suit in which the
decree was passed not as a partner, but in his individual capacity; and that he
had informed the Court that he was not a partner of the defendant firm. The
plaintiffs then applied for execution of the decree claiming that no order of
the Court granting leave to execute the decree was necessary. The District
judge, Patna, by his order dated May 12, 1955 held that the execution could not
be directed against Singh relying upon sub-clauses (b) or (c) of rule 50, O. 2
1, for the question whether he was a partner of the defendant firm was left
undecided by 33 the City Civil Court. The learned District judge further held
on the evidence that Singh was not a partner of the defendant firm.
In appeal against the order of the District. Judge
rejecting the application for execution against singh the High Court at Patna
had that on the facts proved the plaintiffs were entitled as of right to
execute the decree under O. 21 rule 50(1)(b) against Singh. The High Court
accordingly reversed the order passed by the District judge and directed
execution to proceed against Singh. With certificate under Art. 133(1)(a)
granted by the High Court, this appeal has been preferred by Singh.
Order 30 of the Code of Civil Procedure deals
with the manner in which suits may be filed by or against firms. Two or more
persons carrying on business in India may be sued in the name of the firm of
which they were partners at the time of the accrual of the cause of action.
Where a suit has been filed against the firm summons may be served in the
manner prescribed by rule 3. That rule, in so far As it is material, provides-
"Where persons are sued as partners in the name of their firm, the summons
shall be served either- (a) upon any one or more of the partners, or (b) at the
principal place at which the partnership business is carried on within India,
upon any person having, at the time of service, the control or management of
the partnership business there, as the Court may direct; and such service shall
be deemed good service upon the firm so sued, whether all or any of the
partners are within or without India Provided x x x".
34 The plaintiffs had sued the partners of
M/s. Tirbut Umbrella Works in the firm name, and the summons was served on
Singh at Road 8, R Block, Patna. The original summons would normally be with
Singh but he did not care to 'produce it before the District judge, Patna. The
High Court on a review of the circumstances arrived at the conclusion that
Singh was served with summons of the suit as a partner of the defendant firm.
That conclusion is amply supported by the evidence, and the presumption which
arises under rule 5 of O. 30 which provides "Where a summons is issued to
a firm and is served in the manner provided by rule 3, every person upon whom
it is served shall be informed by notice in writing given at the time of such
service, whether he is served as a partner or as a person having the control or
management of the partnership business, or in both characters, and, in default
of such notice, the person served shall be deemed to be served as a
partner." It is not possible to say whether the summons was accompanied by
the notice contemplated by rule 5, but it is clear by the express words of the
rule that in default of such notice the person served shall be deemed to be
served as a partner. Singh has in his affidavit sworn in the suit, and also in
his testimony at the hearing in the execution proceeding admitted that he was
served with a summons in the suit, and Mr. Vishwanath Sastri appearing for
Singh has fairly not challenged the finding- that Singh must be deemed to have
been served as a partner of the defendant firm.
Rule 8 of O. 30 provides :- "Any person
served with summons as a partner under rule 3 may appear under protest, denying
that he is a partner, but such appearance shall not preclude the plaintiff from
otherwise 35 serving a summons on the firm and obtaining decree against the
firm in default of appearance where no partner has appeared." The rule
enables the person served as a partner to appear under protest and to deny that
he is a partner of the firm which is sued. Appearance under protest by the
person sued renders the service of summons as regards the defendant firm in
effective The plaintiff may obtain a fresh summons against the firm and serve
it in the manner prescribed by O. 30 rule 3 against another person who is
alleged to be a partner by the plaintiff or against the person who has the
control or management of the partnership business. A decree against the
defendant firm so obtained may with leave under O. 21 rule 50 (2) be executed
against the firm and also against the person who had been initially, served as
a partner and who had appeared tinder protest denying that he was a partner.
The plaintiff however, is not' obliged to obtain a fresh summons: he may
request the Court to adjudicate upon the plea of denial raised by the person
served and appearing under protest. The Court will then proceed to determine
the issue raised by that plea. If the Court finds on evidence that the person
served was not a partner at the material time, the suit cannot proceed, unless
summons is served afresh under rule 3 : if. the Court holds that he was a
partner service on him will be regarded as good service on the firm and the
suit will proceed against the firm.
In the present case Singh did not enter
appearance under protest. He filed an appearance in his individual name in the
suit, and obtained an adjournment from the Court to enable him to file his
written statement. The appearance so filed must be deemed to be on behalf of
the firm. At the hearing of the summons for directions he contended that he was
not a partner of the defendant firm and applied for leave to withdraw his
appearance which was filed without 36 protest. Unless the Court permitted Singh
to with draw the appearance initially filed, it continued to be an appearance
under rule 6 of O. XXX on behalf of the firm. We are not concerned in this case
to decide whether the application of Singh for leave to with- draw his
appearance was properly rejected. That question could only be raised in adopted
by Singh in the proper Court challenging decision of the duty Civil Court and
not for execution of the decree. Order 21 rule5( the Code of Civil Procedure
deals with execution of decrees against firms. By cl. (1) it is provided:
" Where a decree has been passed against
a firm, execution may be granted- (a) against any property of the partnership
(b) against any person who has appeared in his own name under rule 6 of 'rule 7
of Order XXX or who has admitted on the pleadings that he is, or who has been-
adjudged to be, a partner (c) against any person who has been individually
served as a partner with a summons and has failed to appear.
Provided x x x x x." Clause (2) provides
"Where the decree-holder claims to be entitled to cause the decree to be
executed against any person other than such a person as is referred to in
sub-rule (1), clauses (b) and (c) as being a partner in the firm, he may apply
to the Court r which passed the decree or leave, and where the liability is not
disputed, such Court may grant such leave, or where such liability is disputed,
may order that the liability of such per-son be tried and determined in any
manner in 37 which any issue in a suit may be tried and determined." By
cl. (3) it is provided "Where the liability of any person has been tried
and determined under sub-rule (2), the order made thereon shall have the same
force and be subject to the same conditions as to appeal or otherwise as if it
were a decree." Manifestly relying upon sub-clauses (b) and (c) of sub
rule (1) a plaintiff who has obtained a decree against a firm may execute it
against any person who has been individually served with the summons as a
partner and has failed to appear and also against any person who has appeared
in his own name under rule 6 or rule 7 of Order 'XXX. Singh being a person who
had after being served as a partner appeared under rule 6, the decree of the
City Civil Court, Bombay was executable against him.
The plaintiffs did undoubtedly make an
application for leave to execute the decree against Singh on the footing that
he was a person other than a person referred to in cls. (b) and (c) of sub-rule
(1) of r. 50 O. 21, but that proceeding was plainly the result of an incorrect
appreciation of the true position in law. On that account his right under O. 21
rule 50 (1) (b) was not lost. The plaintiffs were entitled to abandon the
application for leave under sub-rule (2) and to execute the decree under
sub-rule (1).
The record of the City Civil Court, Bombay,
tendered before the District judge clearly establishes that Singh who was
served as a partner of the defendant firm filed an appearance under rule 6 O.
30 of the Code of Civil Procedure, and thereafter his application for
withdrawal of appearance was rejected and the suit was decreed against the
firm. This decree 38 against the firm was by virtue of sub-rule (1)cl. (b) of
rule 50 O. 21, liable to be executed against Singh.
The High Court was therefore, in our judgment
right in directing execution of the decree of the City Civil Court, Bombay,
against Singh. The appeal fails and is dismissed with costs.
Appeal dismissed.
Back
