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Vasantrao Alias Baburao and anr. Vs. Shyamrao and ors. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtSupreme Court of India
Decided On
Case NumberCivil Appeal No. 393 of 1977
Judge
Reported inAIR1977SC2021; [1977]47CompCas666(SC); (1977)4SCC9; [1978]1SCR218; 1977(9)LC499(SC)
ActsCompanies Act, 1956 - Sections 271(2), 582 and 590; Indian Companies Act, 1913; Indian Partnership Act, 1932
AppellantVasantrao Alias Baburao and anr.
RespondentShyamrao and ors.
Appellant Advocate K.S. Ramamoorthy,; S. Balakirishnan and;N.N. Ghatate
Respondent Advocate Naunit Lal, ; Mrs. Lalita Kohli and ;S.G. Ghate
Prior historyAppeal by special Leave From the Judgment and Order dated October 8, 1976 of the Bombay High Court in Civil Revision No. 137/76
Excerpt:
company - dissolution of firm - sections 271, 271 (2) and 582 to 590 of companies act, 1956, indian companies act, 1913 and indian partnership act, 1932 - section 590 of companies act, 1956 provides for winding up of unregistered companies and dissolution of partnership firms governed by partnership act, 1932 - whether civil court has jurisdiction to entertain matter regarding winding up of unregistered companies (partnership firm having more than seven members) - section 590 is saving provision which leaves unaffected operation of any enactment - provisions of dissolution of partnership firm are left untouched by section 590 - held, civil courts are competent to entertain matters regarding dissolution of partnership firms. - order 1, rule 10 & order 6, rule 17: [s.b. sinha & dr...........not a case of volume winding up or winding up subject to the supervision of the chapter vi of the indian partnership act, 1932 also contains persons for the dissolution of a firm and its winding up on dissolution the argument for the appellants is that the special provisions of x of the companies act exclude the operation of the general lav tained in the partnership act in the matter of winding up of having more than seven persons and as the civil judge tryer suit shall have to apply the partnership act, the suit is not mail able.4. it is difficult to appreciate why the suit should not be mainta at any rate in, so far as it is one for dissolution of the firm. already stated, one of the reliefs prayed for is a declaration the firm stood dissolved from january 9, 1974. this is not a.....
Judgment:

A.C. Gupta, J.

1. The two appellants and the six respondents were partners of a firm called 'Shivraj Fine Art Litho Works.' The appellants as plaintiffs instituted civil suit No. 9 off 1974 in the Court of the Senior Civil Judge, Nagpur, for dissolution of the partnership and accounts. The reliefs asked for included a declaration that the firm stood dissolved on and from January 9, 1974. It appears that thereafter the original defendants who are the respondents before us were transposed as plaintiffs and the appellants who were originally the plaintiffs were transferred to the category of defendants. The transposed defendants raised an objection that the court had no jurisdiction to entertain the suit in view of the provisions of Part X he Companies Act, 1956. The trial court rejected the application The defendants then moved the Bombay High Court, Nagpur in revision. The High Court having dismissed the revision on the present appeal has been filed with special leave granted is Court.

2. argued on behalf of the appellants that as Part X of the Com-, Act, 1956 contains special provisions for the winding up of unregistered companies, which expression as defined in that Act in-, a partnership consisting of more than seven members, any for the winding up such a partnership must be in accordance he procedure prescribed for that purpose in the Companies Act, he suit instituted in the court of the Senior Civil Judge was maintainable. Part X of the Companies Act includes Sections 590. Section 582 defines the expression 'unregistered comas follows:

Learning of 'unregistered Company'.

for the purposes of this Part, the expression 'unregistered com-

(a) shall not include-

(i) a railway company incorporated by any Act of Parliament or other Indian law or any Act of Parliament of the United Kingdom;

(ii) a company registered under this Act; or

(iii) a company registered under any previous companies law and not being a company the registered office whereof was in Burma, Aden or Pakistan immediately before the separation of that country from India; and

(b) save as aforesaid, shall include any partnership. association or company consisting of more than seven members at the time when the petition for winding up the partnership, association or company, as the case may be, is presented before the Court.

3. not disputed that the partnership in question had more than embers at the time when the suit Was instituted. This was an 'unregistered company' as defined in Section 582(b). 583(1) states that subject to the provisions of this Part, rgistered company may be wound up under this Act and all visions of this Act with respect to winding up shall apply to gistered company, with the exceptions and additions mentioned Sections (2) to (5)'. It is not necessary to refer in any tail to these Sub-sections except to point out that Sub-section, sections the circumstances in which an unregistered company may be wound up and one of the circumstances is that the company dissolved. It may also be stated that under Sub-section (3) no unregistered company can be wound up under this Act voluntarily or subject to the supervision of the court and can only wound up by the court. Admittedly this is not a case of volume winding up or winding up subject to the supervision of the Chapter VI of the Indian Partnership Act, 1932 also contains persons for the dissolution of a firm and its winding up on dissolution The argument for the appellants is that the special provisions of X of the Companies Act exclude the operation of the general lav tained in the Partnership Act in the matter of winding up of having more than seven persons and as the Civil Judge tryer suit shall have to apply the Partnership Act, the suit is not mail able.

4. It is difficult to appreciate why the suit should not be mainta at any rate in, so far as it is one for dissolution of the firm. already stated, one of the reliefs prayed for is a declaration the firm stood dissolved from January 9, 1974. This is not a relief can be claimed in a proceeding under Part X of the Companies which provides for the winding up of unregistered companies, ever it is not necessary to consider whether the Civil Judge had diction to entertain some of the claims made in the suit, because section 590 of the Companies Act makes it clear that Part X of the does not affect the operation of the Indian Partnership Act. S 590 states:

5. Saving and construction of enactments conferring power to w partnership, association or company in certain cases.

Nothing in this Part shall affect the operation of ar. enactment which provides for any partnership, associatic or company being wound up, or being wound up as a cor pany or as an unregistered company, under the Indian Companies Act, 1913 or any Act repealed by that Act:

Provided that references in any such enactment to a provision contained in the Indian Companies Act, 1913 in any Act repealed by that Act shall be read as reference to the corresponding provision, if any contained in this Act.

6. As the marginal note to this section indicates, this is a savi vision. It leaves unaffected the operation of any enactment (a provides for any partnership, association or company being up, or -(b) which provides for any partnership, association pany being wound up as a company or as an unregistered under the Indian Companies Act, 1913 or any Act repealed Act. An enactment means the whole Act or a part of it.The proviso which contains a rule of construction of re in any such enactment to any provision in the Companies Act, 1913 or any Act repealed by Act is not relevant for the present purpose. It is clear that provisions for winding up of the affairs of a firm which VI of the Indian Partnership Act contains besides provision-, dissolution of partnership are left untouched by Section 59 companies A The cases cited in support of the respective contentions of the parties are not really on the point under consideration except the on of the Mysore High Court in Pattada Auth-v. Pattada Somayya and Anr.(1), to which counsel for the appellants referred. The Mysore case contains an observation on 271 of the Indian Companies Act, 1913 which corresponds Section 590 of the Companies Act, 1956. The learned single who decided the case held that there was nothing in section or in the words 'any unregistered company may be wound up' ring in that section to indicate that the aggrieved party had an to institute a suit for winding up of an unregistered company.decision does not take note of Sub-section (2) of Section 271 is similar to Section 590 of the Companies Act, 1956 leaving the operation of other enactments providing for any part-association or company being wound up.

7. he appeal is dismissed with costs.


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