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Ganeshilal Ramkumar and anr. Vs. Jhangiram Lillaram - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMumbai High Court
Decided On
Case NumberA.F.O. 227 of 1972
Judge
Reported inAIR1974Bom101; (1973)75BOMLR760; ILR1974Bom1105; 1974MhLJ370
ActsCode of Civil Procedure (CPC),1908- Order 5, Rule 21-A - Order 30, Rules 3 and 5 - Order 81, Rule 3(3)
AppellantGaneshilal Ramkumar and anr.
RespondentJhangiram Lillaram
Appellant AdvocateP.L. Nain, Adv.
Respondent AdvocateKeshavdas Dalpatrai, Adv.
Excerpt:
.....service of summons addressed to a firm in the firm name is served on a person in control of the firm's business and no notice is addressed to the particular person informing him whether he is served as a partner or as a person in the control of business or in both characters is served as required by rule 5 of the order 30 of the civil procedure code, 1908, the service is not in the accordance with law - - what is significant, however, is that in the said affidavit in rejoinder, there is no denial of the fact that his nephew ghanshyamdas had received the summons when it arrived at the shop by post or that he had signed the postal acknowledgment in respect of the same, and indeed, the most important fact is that the best person to have made that statement viz. the question as to..........management of the business of the firm, or in both characters and, in default of such notice, the person served shall be deemed to be served as a partner. order 5, rule 21-a provides that the court may, in addition to or in substitution of any other mode of service, cause the summons to be served by registered post, and that an acknowledgment purporting to be signed by the defendant 'shall be deemed by the court issuing the summons to be prima facie proof of service'. a combined reading of these three provisions of the civil producer code shows that, it case of suit filed against firm in its firm name, (1) the summons must be addressed to the firm in the firm name in which it is sued under order 30, rule 1 of the code of civil procedure; (2) the summons must be sent by registered post,.....
Judgment:

1. This is an appeal from an order of Principal Judge Rege of the Bombay City Civil Court (as he then was) dated 28th February 1972 dismissing the first defendant's motion for setting aside an ex parte decree for Rupees 19,545,75, with interest, passed by him on the 6th of April 1971. The basic fact that must be borne in mind for the purpose of this appeal is that the present suit had been filed against the first defendant firm under its firm name in accordance with Order 30, Rule 1 of the Code of Civil Procedure. In support of the application to set aside the exparte decree, Manoharlal Khandelwal, a partner of the 1st defendant firm filed an affidavit in the lower Court in which the case that was made out, was that he did not know at all of the pendency of the suit against him till the 5th November 1971 after which, on taking search of the record of the said suit, he found that the writ of summons had been forwarded for service through post and the acknowledgment in respect thereof had been signed by one Ghanshvamdas on the 18th of December 1970. The 1st defendant's case on the said application was that there was no man bearing that name in the employ of the 1 st defendant firm and that the writ of summons had therefore not been served on that firm and it could not defendant firm and that the writ of summons had therefore not been served on that firm and it could not defend the suit in the lower Court, In the affidavit in reply filed by the plaintiff's manager, it was stated that the said Manoharlal Khandelwal who was the senior Manoharlal Khandelwal who was the senior partner of the 1st defendant firm had a nephew named Ghanshyamdas who though he may not have been an employee of the said firm, was at the material time managing the business of the 1st defendant firm. It was further pointed out in the said affidavit that the said Manoharlal had also another relative named Ghanshyamdas who used to carry on business at Calcutta but used to sit at the shop of the 1st defendant a Kanpur (with which the court is concerned in the present case) when ever he visited Kanpur. The plaintiff has also filed another affidavit in reply which was of one Nakhatmal Uttamchand who appears to have been a broker acting for the plaintiff and who has stated in the said affidavit that, on almost all his visits to 1st defendant's shop. The said Manoharlal has filed an affidavit in rejoinder of the Motion in which he has denied that any person named Ghanshyamdas was managing the business of the 1st defendant firm, and has denied that his nephew Ghanshyamadas was looking after and managing the business of the 1st defendant firm at any time. What is significant, however, is that in the said affidavit in rejoinder, there is no denial of the fact that his nephew Ghanshyamdas had received the summons when it arrived at the shop by post or that he had signed the postal acknowledgment in respect of the same, and indeed, the most important fact is that the best person to have made that statement viz., the said Ghanshyamdas himself, has not filed any affidavit in support of 1st defendant's case on the Motion. It is also significant that there is no denial of the fact the Manoharlal's nephew Ghanshyamadas was in the 1st defendant's shop on that particular day viz., the 18th of December 1970. There is also no denial of the fact that the said Manoharlal had two relatives named Ghanshyamdas. The question as to whether Manoharlal's nephew Ghanshyamadas was in management of the business of the 1st defendant firm and had received the summons and signed a postal acknowledgment in respect thereof on the 18th December 1970 was the only point argued before the learned Principal Judge at the hearing of the Motion in the lower Court, and in my opinion, the affidavits discussed by me above show that, as far as that point me above show that, as far as that point is concerned, the 1st defendants have failed to make out the case on which they relied in support of the application in the lower Court. Those affidavits do show that Manoharlal had a nephew named Ghanshyamadas who used to attend to the business of the shop and had attended it on the 18 the December 1970, and received the summons and signed the postal acknowledgment in respect thereof. The application to set aside an ex parte decree was therefore rightly rejected by the learned Principal Judge.

2. In the course of the hearing of the appeal before me a new point was however, sought to be urged by Mr. Nain who appeared on behalf of the 1st defendant firm, and that was that, even accepting all the facts set out by the plaintiff, there is in law no proper service in compliance with Order 30, Rules 3 and 5 of the Code of Civil Procedure which, if the service is by registered post must be read with Order 5, Rules 21-A of that Code. Though that point was not urged in the lower court, I have allowed Mr. Nain to urge the same before me., because it is a pure point of law on which he desired to make submissions which were based on the assumption that the plaintiff's now facts were true. The first proposition of Mr. Nain was that if the Rule in regard to service by registered post which is to be found in Order 5 Rule 21-A of the Civil Procedure Code in brought against to a case where the suit is brought against the firm in this firm name, it should be so applied as to comply with the provisions of Order 30 Rules 3 and 5 of the same Code. In support of that proposition. Mr. Nain relied on the decision of Single Judge of the Calcutta High Court in the case of Harjibamdas Gordhanadas v. Bhagwandas Parsram, AIR 1922 Cal 390. In the said case, an application was made to set aside an exparte decree passed in a suit against a firm in its firm name. The summons was sent by registered post and a latter was also sent by registered post to the defendant firm which, however, was not addressed to any particular person alleged to be a partner or to have control of the business. It was held by Rankin, J. that the service was not 'strictly correct' and he, therefore, set aside the ex parte decree. In doing so, the learned Judge observed (at page 391) in regard to the Rule permitting service by registered post. 'It does seem to me that if that rule is going to be applied to a case where the suit is brought against a partnership firm in its firm name, it is necessary that it should be so applied as to comply, at all events, with the substance of O. 30. Rule 3- that is to say, in such a case the registered letter should be addressed to some particular person alleged to be a partner or to have control and it should be served by registered post upon such a person'. I agree with the view taken by Rankin, J. in the said case as, in my opinion, the special provisions in regard to service of summons on a firm against which a suit is filed in the firm name which are contained in Order 30 of the Code of Civil Procedure must prevail over the general provisions of the Code of Civil Producer in regard to service by registered post or. at any rate, the latter must be read so as to harmonise with those special provisions.

3. Order 30. Rule of the Code of Civil Procedure Code provides that 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 of business of the firm upon any person having, at the time of service, control or management of the business at that place. Order 30, Rule 5 then proceeds to lay down that where a summons is served in the manner provided by Rule 3 of the Order, the person on whom it is served must be informed by a notice in writing 'given at the time of service', whether he is served as a partner, or as a person having the control or management of the business of the firm, or in both characters and, in default of such notice, the person served shall be deemed to be served as a partner. Order 5, Rule 21-A provides that the Court may, in addition to or in substitution of any other mode of service, cause the summons to be served by registered post, and that an acknowledgment purporting to be signed by the defendant 'shall be deemed by the Court issuing the summons to be prima facie proof of service'. A combined reading of these three provisions of the Civil Producer Code shows that, it case of suit filed against firm in its firm name, (1) the summons must be addressed to the firm in the firm name in which it is sued under Order 30, Rule 1 of the Code of Civil Procedure; (2) the summons must be sent by registered post, prepaid for acknowledgment, (3) the summons should be accompanied by a notice in writing addressed to a particular person informing him whether he is served as a partner, or as a person in control or management of the business, or in both characters. This is apparent from the fact that such a notice is required by Order 30, Rule 5 to be given 'at the time of such service'. If service is effected on a partner, he may be served with the writ of summons with or without notice, for is served without notice, he is deemed to have been served as a partner by reason of the provisions of Order 30 Rule 5. If, however, a person in control of the business is sought to be served, the requisite notice under Order 30, Rule 5, headed in the title of the suit, must accompany the writ of summons. (vide Notes under Order 81, Rule 3 (3) of the Rules of the Supreme Court in England in the Supreme Court Practice, 1970, Vol. 1 p. 2263): and (4) the summons and the notice must be enclosed in an envelope addressed to the particular person who is sought to be served, either as a partner, or a person in the control or management of the business of the firm, or in both capacities, for, otherwise, it would be impossible to predicate who would receive it and sign the postal acknowledgment which, under Order 5, Rule 21-A is to be deemed to be prima facie proof of service. Moreover, from the language of Cls. (a) and (b) of Rule 3 of Order 30 which require service 'upon' one of the partners, or 'upon' a person in the control or management of the business, it is clear that the service contemplated by the said Rule cannot be involuntary.

4. I have called for the record of the case and examined it, and it shows that the summons it, and it shows that the summons in the present case was addressed to the first defendant firm in its firm name. A reference to the Affidavit of Service however shows that the envelope was also addressed to the firm in the firm name, and was no addressed to the said Ghanshyamdas so as to comply with Order 30, Rule 3 of the Code of Civil Procedure. Moreover it is an admitted position that no notice of the nature required by Order 30. Rule 5 of the Code of Civil Procedure accompanied that summons. The said Ghanshyamdas, who signed the postal acknowledgment was admittedly not a partner of the firm. If service is effected on the person in control of the business and no notice is served as provided by Order 30, Rule 5, the service is not effective (Vide Notes under Order 81 Rule 3 (3) of the Rules of the Supreme Court in England in the Supreme Court Practice, 1970. Vol. I p. 1163). I must therefore, hold that service of the summons has not been effected on the first defendant firm in the present case in accordance with law and the exparte decree passed by the learned Principal Judge on the 6th of April 1971 must be set aside.

5. Order 9, Rule 13 of the Code of Civil Procedure, however, empowers the Court to put the defendant who succeeds in an application to set aside an ex parte decree upon terms and I think this is a proper case in which that power should be exercised by me, since the 1st defendant firm are succeeding in this appeal on a technical plea though I have not the least doubt that, having regard to the fact that the summons was served upon the said Ghanshyamdas who was a nephew of Manoharlal, the 1st defendants firm must have known of the pedency of the suit. I therefore pass the following order: -

On the 1st defendant firm depositing in the trial Court a sum of Rs. 10,000/- on or before the 25th of June 1973, this appeal will stand allowed and the exparte decree passed by the learned Principal Judge on the 6th of April 1971 will be set aside. In the event, however, of the 1st defendant firm failing to make the said deposit within the time fixed be me, this appeal will stand dismissed and the order of dismissal of the Notice of Motion passed by the learned Principal Judge on the 28th of February 1972 will stand confirmed. In either case, the appellants must pay the respondent's costs of the appeal in this Court, as well as of the Motion in the lower Court.

6. Appeal allowed on terms.


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