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Motilal Chhajulal Vs. Giridharilal Rameshwarlal - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1942Cal613
AppellantMotilal Chhajulal
RespondentGiridharilal Rameshwarlal
Cases ReferredNathuni Prasad v. Firm Radha Kissen Dutt Rai
Excerpt:
- .....firm called giridharilal rameswarlal and allege that giridharilal rameswarlal was the name of a joint family business which belonged to a joint mitakshara hindu family of which they are some of the members. they contend that inasmuch as giridharilal rameswarlal was not a contractual firm the award is a nullity and cannot be executed at all. in the alternative they contend that at any rate the award cannot be executed against them inasmuch as the provisions of order 21, rule 50 are applicable to contractual firms only and not to joint family businesses.2. the first question for determination is whether messrs. giridharilal rameswarlal constitute a partnership firm. the evidence on this point is onesided and i have no hesitation whatsoever in holding that the business of giridharilal.....
Judgment:
ORDER

Sen, J.

1. This is an application under Order 21, Rule 50, Civil P.C. The petitioner alleges that there were transactions between the petitioner and Messrs. Giridharilal Rameswarlal as a result of which a certain sum became due to the petitioner. Disputes arose and they were referred to the arbitration of the Bengal Chamber of Commerce under the old Arbitration Act. The parties to the arbitration as set out in the award are as follows: 'Messrs. Motilal Chhajulal sellers and Messrs. Giridharilal Rameswarlal, buyers.' An award was made against Messrs. Giridharilal Rameswarlal. The award was filed in Court and became enforceable as a decree. The petitioner now applies under Order 21, Rule 50, Sub-rule (2), Civil P.C., for leave to execute the award against three persons, viz., Lalchand Khendelwal, Kaluram Khendelwal and Benarasilal Khendelwal on the ground that they are partners of the firm of Messrs. Giridharilal Rameswarlal. Lalchand Khendelwal and Benarasilal Khendalwal are represented by Mr. H.D. Bose and Kaluram Khendelwal by Mr. S.M. Bose. The contentions on their behalf are the same. They say that there was no partnership firm called Giridharilal Rameswarlal and allege that Giridharilal Rameswarlal was the name of a joint family business which belonged to a joint Mitakshara Hindu family of which they are some of the members. They contend that inasmuch as Giridharilal Rameswarlal was not a contractual firm the award is a nullity and cannot be executed at all. In the alternative they contend that at any rate the award cannot be executed against them inasmuch as the provisions of Order 21, Rule 50 are applicable to contractual firms only and not to joint family businesses.

2. The first question for determination is whether Messrs. Giridharilal Rameswarlal constitute a partnership firm. The evidence on this point is onesided and I have no hesitation whatsoever in holding that the business of Giridharilal Rameswarlal does not constitute a co-partnership firm but that it is a joint family business belonging to a Mitakshara joint family of which the three respondents are members. The petition of the firm Motilal Chhajulal in this proceeding is verified by one Govindprosad who is the constituted attorney of the petitioner firm. In para. 5 of this petition it is stated: 'that Lalchand Khendelwal, Kaluram Khendelwal and Benarsilal Khendelwal were and are some of the partners of the said firm of Giridharilal Rameswarlal.' In the verification of the petition Govindprosad says that he has no personal knowledge of this fact and that it is based on information received and believed to be true. The source of the information is not given. After the affidavit in opposition had been filed stating that Giridharilal Rameswarlal was the name of a Hindu joint family business and denying the existence of any such co-partnership firm, Govindprosad swore another affidavit in opposition in which he denied that Giridharilal Rameswarlal is a joint family business and stated that it was a partnership firm. That is all the evidence given on behalf of the petitioner firm to prove the existence of a partnership firm called Giridharilal Rameswarlal. On behalf of the respondents certain materials have been placed before me which establish that there is no such firm. There are the affidavits of Kaluram and Lalchand to the effect that Giridharilal Rameswarlal is not a co-partnership firm but the name of a joint family business. A suit was filed regarding this very same matter by Kaluram Khendelwal against the petitioner and one Chandgiram Sharma. The cause title of the plaint is in the following terms:

Kaluram Khendelwal for self and as karta of a Hindu joint family carrying on business under the name and style of Giridharilal Eameswarlal.

3. The cause title is verified as being true to the knowledge of the plaintiff. The petitioner made an application for the stay of the suit on the ground that the matter in suit had been referred to arbitration. That petition was sworn to by Radheyshyam, a partner of the petitioner firm of Motilal Chhajulal. In para. 9 of that petition the petitioner firm states as follows:

Thereafter on or about 27th July 1940 the above suit was instituted by the plaintiff Kaluram Khendelwal abovenamed as the karta of the said firm of Giridharilal Rameswarlal which appears to be a, joint family business, against your petitioners.

4. Radheysham states that this statement is true to his knowledge. The suit was stayed on the footing that the transactions between the members of this Hindu joint family and the petitioner were the same as those which formed the subject-matter of arbitration proceedings. In these circumstances I find it impossible to believe the statement now made by Govindprosad that Giridharilal Rameswarlal was a co-partnership firm. My attention was drawn by Mr. Das to a warrant of attorney filed by Kaluram Khendelwal in the present application. There Kaluram Khendelwal states as follows:

I, Kaluram Khendelwal, one of the partners of the firm of Messrs. Giridharilal Rameswarlal judgment-debtors' firm abovenamed do hereby nominate and appoint Messrs. Nahar & Datta, attorney-at-law, etc.

5. Mr. Das contends that this amounts to an admission of the existence of a co-partnership firm named Giridharilal Rameswarlal and of the fact that Kaluram Khendelwal was a partner thereof. I do not think that any importance should be attached to the statement in the warrant of attorney in view of the fact that Kaluram Khendelwal after executing this warrant swears that there is no co-partnership firm called Giridharilal Rameswarlal and that 'Giridharilal Rameswarlal' is the name of a joint family business belonging to a Mitakshara joint family. The words 'one of the partners of the firm of Messrs. Giridharilal Rameswarlal' were used loosely. The words 'firm' and 'partner' are often inaccurately used to describe a joint family business and a member of such a joint family respectively. I hold that there is no partnership firm called Giridharilal Rameswarlal and that Giridharilal Rameswarlal is the name of the joint family business of a Mitakshara family of which the three respondents Kaluram Khendelwal, Benarsilal Khendelwal and Lalchand Kheldelwal are members.

6. The next question which arises is whether in these circumstances the award made against Giridharilal Rameswarlal can be enforced against these three persons by having recourse to the provisions of Order 21, B. 50. Under the general law if a person wishes to enforce a right by suit against anyone he must institute the suit against that person and in the name of that person. Where however two or more persons carry on business in co-partnership in a firm name they may sue or be sued in the name of the firm. This is allowed by Order 30, Civil P.C. The order makes an exception to the general rule for the sake of convenience; but the concession granted by the order is only in favour of contractual firms and not in favour of joint family businesses. This has been clearly laid down by this Court in Lalchand Amonmal v. M.C. Boid & Co. : AIR1934Cal810 . In that case reference was made to another unreported case Shivaprasad & Sons v. Ormerods (India) Ltd. Suit No. 1207 of 1925 wherein it was also held that Order 30, Civil P.C., had no application to a joint family business and that the members of a joint family carrying on a joint family business in a particular name could not sue or be sued in that name under Order 30. It is clear, therefore, that if a suit had been filed by the firm of Motilal Chhajulal it would have had to have been filed against the respondents in their individual names. A suit filed against a defendant described as Giridharilal Rameswarlal would not be a suit against the members of the Mitakshara family which carried on a business named Giridharilal Rameswarlal and a decree passed in such suit against Giridharilal Rameswarlal would in my opinion be a nullity and incapable of execution inasmuch as Giridharilal Rameswarlal is neither a person in fact nor recognized as such by law even for limited purposes of Order 30.

7. Mr. Das on behalf of the petitioner argues that even if a decree passed in a suit such as has been described by me be not executable, an award made in similar circumstances would be executable because an award is not a decree. He says that something which may be bad as a decree is not necessarily bad as an award. He next refers me to Section 15, Arbitration Act, which lays down that when an award is made and filed in Court it becomes enforceable as if it were a decree of the Court and contends that even if the award be bad if looked upon as a decree once it is filed the Court has no option but to enforce it and for that purpose to treat it as a good decree. In support of this view he referred me to Manilal Lallubhai v. Bharat Spinning and Weaving Co. Ltd. ('33) 20 A.I.R. 1933 Bom. 433. With great respect to Mr. Das I must say that I am unable to appreciate how that case has any relevancy to the question which is now under discussion. In that case an award was made against a contractual firm. It was filed in Court and an application was made under Order 21, Rule 50 to enforce the award against certain persons who were alleged to be partners of the firm. In opposition to the application it was contended that Order 21, Rule 50 applied only to decrees and therefore it could not be availed of by persons seeking to enforce an award. It was held there that for the purposes of enforcement the award against a firm should be considered to be a decree and that therefore Order 21, Rule 50 would be clearly applicable to the enforcement of such an award. It was said there that the award by a fiction became a decree of Court. The case decided no more than that. It was nowhere said that if the fictional decree was proved to be incapable of execution owing to certain defects, the defects should be ignored and the decree executed as a good decree with the help of some other fiction. The question which I am now considering is this : If a decree cannot be enforced under Order 21, Rule 50 because it is not a decree against a contractual firm can an award of the same nature be enforced under Order 21, Rule 50. The case relied upon by Mr. Das offers no solution to this question. It seems to me that once it is held that a decree against a joint family business which is not a contractual firm cannot be executed with the aid of Order 21, Rule 50 it must necessarily follow that an award against such business is equally incapable of such execution. Section 15, Arbitration Act, lays down that the' award when filed becomes enforceable as a decree of the Court in which it has been filed. In other words for the purposes of execution the award must be treated as a decree. If this award is so treated it becomes a decree against Giridharilal Rameswarlal which is the name of a joint family business and not of a contractual firm and it is subject to all the infirmities of such a decree.

8. Mr. Das next argued that a decree against a joint family business could be executed by having recourse to the provisions of Order 21, Rule 50 and he referred me to Nathuni Prasad v. Firm Radha Kissen Dutt Rai ('40) 27 A.I.R. 1940 Pat. 149. There is an observation of Chatterjee J. in that case to the effect that Order 21, Rule 50 applies to decrees against a joint family business but this is merely an obiter dictum inasmuch as the learned Judge expressly stated that it had not been proved that the business was not a co-partnership firm. All I need say is that I do not agree with the view expressed in that case. Order 21, Rule 50 applies only to decrees passed against a firm. This is clear from the very words of the rule. The word 'firm' is used in this rule in the same sense as that in which it is used in Order 30 because the rule applies only to decrees passed in suits instituted under Order 30. That being so it must be held that Order 21, Rule 50 applies only to a decree passed against a contractual firm and not to a decree passed against a joint family business. The matter may be looked at from another point of view. Order 21, Rule 50 permits a decree passed against a firm to be executed with leave of the Court against a partner of the firm. Now the liability of a partner is very different from the liability of a member of a joint family business. The rule cannot therefore be employed to fix the liability of a partner upon a person who is not a partner.

9. After arguments on behalf of the respondents had been concluded Mr. Das suggested in the course of his reply that the question whether Giridharilal Rameswarlal was a contractual firm or a joint family business should be set down for hearing as a suit and he referred to the latter part of Order 21, Rule 50(2). This request came as a surprise. Throughout the very long arguments of Mr. Das which extended over two hours, no such suggestion was made and the matter was discussed on the footing that the Court should come to a decision on this point on the materials already before it. Mr. Das does not disclose what fresh materials there are to establish the fact that Giridharilal Rameswarlal was a co-partnership. I have already pointed out that Radheshyam a member of the petitioner firm accepted the position that Giridharilal Rameswarlal is a joint family business; I have also pointed out that the petitioner firm obtained the stay of the suit of Kaluram on the footing that the transactions alleged in the suit to be between the members of the Hindu joint family and the petitioner were the transactions involved in the arbitration proceedings. These facts and the facts disclosed in the affidavits leave no doubt in my mind that to concede to Mr. Das's request would be to prolong these proceedings uselessly. Again I am of opinion that the provision in Order 21, Rule 50(2) to the effect that, where a person sought to be made liable as a partner denies such liability, the Court may have the issue of liability tried as a suit is one which does not apply to this case. Order 21, Rule 50(2) runs thus:

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 which passed the decree for 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 person be tried and determined in any manner in which any issue in a suit may be tried and determined.

10. Order 21, Rule 50 presupposes that there is a decree against a firm and lays down the procedure for executing such decree against persons alleged to be partners of the firm. The opening words of Order 21, Rule 50 make this clear. They are as follows: 'Where a decree has been passed against a firm, execution may be granted, etc.' Sub-rule (2) deals with a ease where a person denies that he is a partner of the firm against which the decree has been passed. The words used are 'where such liability is disputed', i.e., liability by reason of being a partner. The present dispute does not relate to the question whether the respondents are partners of a firm against which an award has been made but it relates to the question whether the award is against a firm at all. This dispute is not one which is contemplated by Order 21, Rule 50(2) and therefore the provision in the rule that the question of disputed liability may be set down for hearing as an issue in a suit does not really apply. For the above reasons I hold that the award is incapable of execution as a decree and that even if it is executable it cannot be executed against the respondents by invoking the aid of Order 21, Rule 50. The application is, therefore, dismissed with costs.


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