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S. Krishnan Vs. Aruna and Associates - Court Judgment

LegalCrystal Citation
CourtChennai High Court
Decided On
Reported in(1979)2MLJ1
AppellantS. Krishnan
RespondentAruna and Associates
Cases ReferredChunilal v. Ahmed Rowther A.I.R.
- .....was sought for in the following terms:1. cause title.. . p. balasubramanian, proprietor m/s. aruna & associates.plaintiff.2. para one of the plaint. . the plaintiff, p. balasubramanian is the son of r.panchapakesan, hindu, aged about 42 years, carrying on business as: proprietor, messrs. aruna andassociates and is residing at no. 163-v, royapettah high road, madras-4.3. verification. . i, p. balasubramanian, son of r. panchapakesan, hindu, agedabout 42 years, proprietorof m/s. aruna and associates do hereby declare that the facts stated above inparas 1 to 8 are true and correct and sign thisverification at madras on this day of 1976.5. mr. harikrishnan, learned counsel for the defendant-petitioner, takes up the preliminary objection that the application for amendment ought not to.....

T. Ramaprasada Rao, C.J.

1. This Civil Revision Petition is against an order of the learned City Civil Judge, who allowed an amendment of the plaint which amendment was under the following circumstances, as mentioned by the Court below:.It is stated in the affidavit that the petitioner-plaintiff has filed the suit for recovery of Rs. 24,711-30 due. to him as charge for construction work carried on by him. It is also stated in the affidavit that the plaintiff's firm was a partnership and that the partnership' was dissolved on 22nd February, 1972. After the dissolution the plaintiff was carrying on the business as the sole proprietor of the plaintiff firm. At the time of the institution of the suit this fact was not brought to the notice of the counsel. The firm has been running by the plaintiff as the sole proprietor. Hence he prays that the plaint should be suitably amended and that the long cause title should be permitted to be suitably amended.

2. Messrs. Aruna and Associates was, originally a partnership firm. It is said to have been dissolved on 22nd February, 1972. In spite of such a dissolution having taken place and in spite of the fact that it is alleged that the petitioner who sought for an amendment in the lower Court professed that he became the sole proprietor of Messrs. Aruna and Associates, the suit was instituted on 27th April, 1974 in the name of the firm Messrs. Aruna and Associates but describing the same as a partnership firm carrying on business as Engineers and Contractors at Madras.

3. The suit was resisted inter alia on the ground that the plaint partnership firm was an unregistered one and, therefore, no suit could be filed by an unregistered firm in its own name without the same being registered in a'-manner known to law under the Partnership Act. A specific issue was also raised on 28th August, 1974 whether the suit was maintainable at all by an unregistered firm. Realising the impasse and difficulty in the matter, the plaintiff-respondent filed an application for an amendment in October, 1976. The amendment was sought for in the following terms:

1. Cause title.

. . P. Balasubramanian, proprietor M/s. Aruna & Associates.Plaintiff.

2. Para one of the plaint

. . The plaintiff, P. Balasubramanian is the son of R.Panchapakesan, Hindu, aged about 42 years, carrying on business as: proprietor, Messrs. Aruna andAssociates and is residing at No. 163-V, Royapettah High Road, Madras-4.

3. Verification

. . I, P. Balasubramanian, son of R. Panchapakesan, Hindu, agedabout 42 years, proprietorof M/s. Aruna and Associates do hereby declare that the facts stated above inparas 1 to 8 are true and correct and sign thisverification at Madras on this day of 1976.

5. Mr. Harikrishnan, learned Counsel for the defendant-petitioner, takes up the preliminary objection that the application for amendment ought not to have been entertained at all since it is not in dispute that the original suit: which was brought into the portals of the-Court was by a partnership which was not registered under the Partnership Act and that therefore, under Section 69 (2) of the Partnership Act, the suit was not maintainable as the mandate therein is so clear and emphatic. The additional ground is that law cannot be-circumscribed by a bare allegation and the entire phase of the suit changed by stating that the present plaintiff who has to contest the matter and prosecute the suit is a person who is the proprietor of the quondam partnership firm after it was dissolved in 1972. Answering this, Mr. Srivastamani says that what is sought for by the plaintiff, may be at a belated stage, need not be accepted at its. face value and that no prejudice would be caused to the plaintiff if the amendment is allowed subject to a privilege being granted' to the defendant to challenge the plaintiff to. establish that there was. a dissolution in February, 1972, and that it was only a mistake which crept into the pleadings.

6. A suit filed by an unregistered partnership should even at the threshold be deemed to be an action non est in the eye of law because of the specific mandate under Section 69 (2) of the Partnership Act, Section 69 (2) reads:

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.

This compulsion, which is in the nature of statutory mandate cannot be avoided in any manner. Messrs. Aruna and Associates come to this Court alleging that it was a partnership firm of engineers and contractors. Later, they had to confess that it was an unregistered firm. Therefore, the suit which they brought into Court was one which was directly violative of the mandate under Section 69 (2) of the Partnership Act. The mandate contained in Section 69 (2) is so assertive that it says that no suit shall be brought in by an unregistered firm. Such being the prescription, it should be presumed that such an action brought into Court by Messrs. Aruna and Associates though knowing it was an unregistered firm as it is a partnership firm has to be ignored and has to be treated as nonexistent.

7. The learned Counsel for the respondent, however, relied upon a decision of our Court in Md. Abdul Samad v. Madarsa Rowther : AIR1959Mad440 .the ratio in which says that a dissolved firm can bring in a suit in the name of the quondam firm or a partner of the dissolved firm can possibly bring up such an action.

8. The question though in the first instance appeared to be so simple as one governed by the principle in the above decision yet, in view of the pleadings the above decision does not apply to the facts of this case. In this case, it was asserted in the plaint that there was a partnership which was proved to be an unregistered partnership, and appeared to be one. In view of Section 69 (2) such a suit filed by an unregistered partnership is no suit at ail in the eye of law and hence I characterised it as a non est action. But in the case decided by Subrahmanyan, J., in the above case, it was brought out that a dissolved firm after dissolution filed a suit in its own name and contended that any such attitude is not irreconcilable with the mandate in Section 69 (2) and that notwithstanding the directive in Section 69 (2), the dissolved firm can bring an action in its own name. But the position is entirely different in the instant case. Though the dissolution is said to have happened in February, 1972, there was not a whisper about it in the pleadings. On the other hand, it was stated on verification that Messrs, Aruna and Associates was a partnership firm which later turned out to be an unregistered firm. On an objection taken by the defendant in 1974, the application for amendment was filed in 1976 wherein an allegation is made that the above partnership firm was dissolved in 1972. Such a belated' attempt ought not to be encouraged. Even otherwise, if the' amendment was in line with the ratio of the decision in Md. Abdul Samad v. Madarsa Rowther : AIR1959Mad354 and if the amendment by the plaintiff was to the effect that they wanted to allege that though the suit was instituted in the firm's name which was a dissolved firm and a suit by the dissolved firm being maintainable as per the decision as above, the amendment might be allowed. But what was. attempted by the petitioner who sought for, an amendment was that he wanted to just come on record as the proprietor of the firm and not as a person who took over the assets of a dissolved partnership. Matters might have been different if such was the attempt. For, the proposition that a suit which was originally ushered into the Court by an unregistered' partnership cannot be converted into a suit as if it was instituted by a person as proprietor thereof and is incompetent is the ratio in the decision in Chunilal v. Ahmed Rowther A.I.R. 1960 Ker. 159. The essential principle behind such actions and decisions is obvious. A person cannot approbate and reprobate. When once he takes up a stand that it is a partnership firm, he should stand by it. Once he takes up the position that it is a dissolved firm, equally he should be prepared to substantiate it. But he cannot have a third way out of it by bringing in a person who was a quondam partner of the unregistered firm as if he has become the proprietor thereto' on dissolution. This metamorphosis is not available in law. The Court below did not recognise this material change in the pleadings if the amendment was to be allowed. In this sense, therefore, the order is in excess of the jurisdiction of the Court below besides suffering from a material irregularity. The Civil Revision Petition is, therefore, allowed. No costs.

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