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Bhardia Brothers Vs. Union of India (Uoi) and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtOrissa High Court
Decided On
Case NumberSecond Appeal Nos. 190, 191 and 273 of 1968
Judge
Reported inAIR1973Ori28
ActsPartnership Act, 1932 - Sections 69(2); Code of Civil Procedure (CPC) , 1908 - Sections 80; Railways Act, 1890- Sections 78B
AppellantBhardia Brothers
RespondentUnion of India (Uoi) and ors.
Appellant AdvocateHaridas Sen, Adv.
Respondent AdvocateB.K. Pal and ;Bijoy Pal, Advs.
DispositionAppeals dismissed
Cases ReferredProvince of Bombay v. Pestonji Ardeshir
Excerpt:
.....the firm of balabagas hullas chand will also carry on business at other places in the name of 'bhardia brothers'.this deed of partnership has not been proved in this case, and i would have been inclined to admit this as an additional piece of evidence if i were satisfied that this document would have advanced the case of the appellant. section 59 provides that when an application for registration is made containing a statement of all the informations required in section 58, and the registrar is satisfied that the provisions of section 58 have been fully complied with, he shall record an entry of the statement in a register called the register of firms, and shall file the statement. suits framed in any other manner for enforcing such a right would clearly be bit by section 69(2) of..........a certified copy of the entry of the register of firms in this case. it appears from this that the firm-name is 'balabagas hullas chand' and the partnership was constituted on 19-5-58. mr. sen, learned counsel for the appellant, produced before me the deed of partnership whercfrom it appears that the firm of balabagas hullas chand will also carry on business at other places in the name of 'bhardia brothers'. this deed of partnership has not been proved in this case, and i would have been inclined to admit this as an additional piece of evidence if i were satisfied that this document would have advanced the case of the appellant. but in my view even that recital in the partnership deed would not affect the legal position, and hence t have not agreed to admit this document as a piece of.....
Judgment:

S.K. Ray, J.

1. These three second appeals have been ordered to be heard analogously since the parties arc the same, and they involve common questions of law and fact. This judgment, therefore, will govern all of them.

2. All these three second appeals arise out of three suits filed by the same plaintiff who is the appellant in each of these appeals. Second Appeal No. 190/68 arises out of a suit for recovery of damages of Rs. 828.00 on account of short delivery of goods (sixty bags of Motichur) delivered at Malgodown, Cuttack, indented through the Railways from Kissengunj. Second Appeal No. 191/68 is also from a suit for damages of Rs. 847-08 on account of short delivery of a consignment of mustard oil, and Second Appeal No. 273/68 is also a similar appeal arising out of a suit for recovery of damages of Rs. 669-75 on account of short delivery of consignment of Motichur. All these consignments, in all the three suits, were to be delivered at Malgodown, Cuttack.

3. The plaintiff in all these three suits is Messrs Bhardia Brothers. Originally the plaintiff was described as 'Messrs Bhardia Brothers, a registered firm, having its place of business at Malgodown, Cuttack.' Subsequently it was amended to: 'Messrs Bhardia Brothers, a branch of a registered firm having its principal place of business at 161/1 Mahatma Gandhi Road, Calcutta, and a place of business at Malgodown, Chowliagunj, Cuttack.' In the petition for amendment the plaintiff stated:

'The Plaintiff is a branch business of a registered partnership firm in the name and style of 'Balabagas Hullashchand' the registration number being 35747 of date 20-12-58 (Constituted under partnership-deed dated 19-6-58), having its principal place of business at 161/1 Mahatma Gandhi Road, Calcutta-7, and is carrying on business of oil, Motichur and various food-stuffs at Malgodown, Cuttack.'

The need for this amendment arose because on account of certain defences taken by the Union of India representing the railways. Those defences were as follows:

(1) That the original plaintiff in this case being 'Bhardia Brothers' who is not a registered firm this suit is not maintainable under Section 69(2) of the Indian Partnership Act;

(2) That the firm Balabagas Hullas Chand cannot maintain the suit as the said firm is not the owner of the goods and no notice under Section 80, C. P. C. was served on behalf of the said firm, and

(3) The plaintiff being not a registered firm, the alleged principal firm cannot cover the defect under Section 69(2) of the Act. Moreover, it is denied that the plaintiff is a branch of the registered firm 'Bala-bagas Hullas Chand.'

4. It is not in controversy that the mandatory notices under Section 80, C.P.C. and Section 78-B of the Indian Railways Act without which the suits would fail in limine were sent in the name of Messrs. Bhardia Brothers, a registered firm having its place of business at Cuttack, without indicating that it was a branch of the firm Balabagas Hullashchand.

5. All the three suits were decreed by the Trial Court, but were dismissed by the appellate Court, in each case accepting the defence contention, that if the real plaintiff is Messrs Bhardia Brothers, then the same not having been registered the suit will not be maintainable under the provisions of Section 69(2) of the Indian Partnership Act. But if the plaintiff is treated as representing the real partnership firm of Balabagas Hullas Chand, then the suit shall also be dismissed, because notices under Section 80, C. P. C. and 78-B of the Indian Railways Act have not been issued in the name of the registered firm.

6. The only contention on behalf of the 'appellant is that Bhardia Brothers is a branch business of the firm 'Balabagas Hullas Chand'. The very Partnership deed under which the firm 'Balabagas Hullas Chand' was constituted refers to the branch business of the firm under the name 'Bhardia Brothers', and therefore, there is an identity between 'Bhardia Brothers' and the firm 'Balabagas Hullas Chand' and in that view the suit cannot be held to be non-maintainable under Section 69(2) of the Indian Partnership Act, nor can the notices under Section 80, C. P. C. and Section 78-B of the Indian Railways Act be said to be invalid not having been served in the name of the real firm.

7. The plaintiff has filed a certified copy of the entry of the Register of Firms in this case. It appears from this that the firm-name is 'Balabagas Hullas Chand' and the partnership was constituted on 19-5-58. Mr. Sen, learned Counsel for the appellant, produced before me the deed of partnership whercfrom it appears that the firm of Balabagas Hullas Chand will also carry on business at other places in the name of 'Bhardia Brothers'. This deed of partnership has not been proved in this case, and I would have been inclined to admit this as an additional piece of evidence if I were satisfied that this document would have advanced the case of the appellant. But in my view even that recital in the partnership deed would not affect the legal position, and hence T have not agreed to admit this document as a piece of additional evidence.

8. I will now take up the first question whether the suit is barred under Section 69(2) of the Indian Partnership Act Section 69(2) reads as follows:

'(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm.'

It is clear from this that no suit of the nature contemplated in the sub-section extracted above shall be instituted either by the firm itself, or by or on behalf of the firm against any third party unless the firm is registered, and the persons suing are or have been shown in the register of firms as a partnership firm. Section 58 of the Partnership Act provides that when there is an application for registration of a firm, it shall contain a statement of matters enumerated in Clauses (a) to (f) of Sub-section (1) of this section. One of the informations which must be furnished in the application is the Firms' name. Other particulars to be stated in the application for registration is the disclosure of the full and permanent addresses of the partners and the names of any other places where the firms carries on business, and that statement shall be signed by all the partners or their agents specially authorised on this behalf. Section 68 of the Indian Partnership Act lays down rules of evidence by providing that any statement, intimation or notice recorded or noted in the register of firms shall, as against any person by whom or on whose behalf such statement, intimation or notice was signed, be conclusive proof of any fact stated therein, and that a certified copy of an entry relating to a firm in the register of firms may be produced in proof of the fact of registration of such firm and all the contents of any statement, intimation or notice recorded or noted therein. Section 59 provides that when an application for registration is made containing a statement of all the informations required in Section 58, and the Registrar is satisfied that the provisions of Section 58 have been fully complied with, he shall record an entry of the statement in a register called the Register of Firms, and shall file the statement. This means after the registration is allowed the statement of informations required under Clauses (a) to (f) of Sub-section (1) of Section 58 form part of the entries in the Register of Firms. Therefore, any certified copy of an entry relating to a firm in the Register of Firms would contain all the informations given in the statement referred to in Section 58(1) of the Partnership Act.

9. The certified copy of the entry does not show that Bhardia Brothers is the firm-name of the firm, or that Bhardia Brothers is a partner of the firm, or that the firm is to carry on business at Cuttack in the name of 'Bhardia Brothers'. It is to be noted that Section 68 of the Partnership Act while providing special rule of evidence states that a statement recorded in the Register of Firm shall be conclusive proof of any fact therein stated which means no other evidence is admissible with regard to such facts or with regard to any fact at variance with such facts or in modification of such facts. The only fact that appears from this certified copy of the Register of Firms is that the firm of Balbagas Hullashchand shall carry on its business, besides its principal place of business, at Calcutta, in Assam and also in Cut-tack. In whatever else's name the firm carries on its business at Cuttack, it is his business, and therefore, any suit to enforce a right arising out of a contract relating to such business shall be instituted by the firm or the partners of the firm. Suits framed in any other manner for enforcing such a right would clearly be bit by Section 69(2) of the Partnership Act. The prohibition contained in Section 69(2) is absolute, viz., that if any of the conditions laid down in that sub-section is absent the suit must fail. As already indicated, Bhardia Brothers is not a partner of the firm and is not the firm-name. This is a suit which apparently is on behalf of the firm and in such a case the plaintiff must be the firm itself or persons who are partners in the firm. There is no alternative method of maintaining the suit in the name of any other entity. To emphasize the point, I will extract again the relevant provisions of Sub-section (2) of Section 69:

'No suit ..... shall be instituted ..... unless ..... the persons suing are or have been shown in the Register of Firms as partners of the firm.'

This condition is, obviously, not satisfied in this case, because to repeat the Bhardia Brothers, the person suing, is not shown as a partner of the firm. I think the Lower Appellate Court was justified in coming to the conclusion that the suit is barred under Section 69(2) of the Partnership Act.

10. The suit must also fail for the additional reason that Section 80 notice issued under the name of Bhardia Brothers cannot be treated to be a notice issued by the firm, and as such, the suit must fail on the ground of non-compliance with Section 80.

11. It has been held in the case of S.N. Dutt v. Union of India, reported in AIR 1961 SC 1449 that:

'Section 80, according to its plain meaning, requires that there should be identity of the person who issues the notice with the person who brings the suit. Where an individual carries on business in some name and style the notice has to be given by the individual in his own name, for the suit can only be filed in the name of the individual.'

In that case notice under Section 80 was given by Messrs. S.N. Dutt and Co., and the suit was filed by S.N. Dutt, and the Supreme Court held that the person giving the notice was not the same as the person suing, and therefore, Section 80 is not complied with.

12. In coming to this conclusion, their Lordships of the Supreme Court relied upon certain Privy Council decisions. In the case of Bhagchand Dagdusa v. Secretary of State, AIR 1927 PC 176, and said that:

'Section 80 was explicit and mandatory and admitted of no implications or exceptions and had to be strictly complied with.'

13. In the case of Vellayan Chettiar v. Govt. of the Province of Madras, AIR 1947 PC 197, the Privy Council dealing with Section 80, particularly with reference to the name under which notice is to be issued said that where the suit is brought by two plaintiffs, but notice is given by only one of them, the suit is bad in law, and said that

'Section 80 requires that there should be identity of the person who issues the notice with the person who brings the suit.'

14. The same view was repeated by the Privy Council in the case of Govt. of the Province of Bombay v. Pestonji Ardeshir, AIR 1949 PC 143.

15. Mr. Sen contends that Section 80 notice should not be scrutinised in a pedantic manner or in a manner completely divorced from common sense, since, in substance, the firm of Balabagas. Hullaschand was the plaintiff and that notice had been given in the name of Bhardia Brothers in which name the firm was carrying on its business, and it will be in accord with the common sense to hold that the requirement of law has been substantially complied with in the circumstances. Such a contention was noticed by the Supreme Court in the case cited above, and it was held that there would be non-compliance with Section 80 notice so long as the identity of the name of the plaintiff with the name of the person giving notice was not established. Rejecting the common sense theory their Lordships said: 'No amount of common sense will put the name of the plaintiff there if it is not there.' I am also satisfied that there is no identity of the firm or partners of the firm who alone are entitled to institute the suit or give notice under Section 80, Civil Procedure Code, with the person who instituted the suit or issued notice under Section 80. In this view also the suit shall fail.

16. For the aforesaid reasons, I am satisfied that there is no merit in any of these appeals which are accordingly dismissed with costs.


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