Orissa High Court
Sri Liladitya Deb vs Registrar Of Firms & Another ....... ... on 29 April, 2020
Equivalent citations: AIRONLINE 2020 ORI 40
Author: K. R. Mohapatra
Bench: K.R. Mohapatra
HIGH COURT OF ORISSA: CUTTACK
W.P (C) No. 4541 of 2015
In the matter of application under Articles 226 & 227 of
Constitution of India.
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Sri Liladitya Deb ....... Petitioner
-Versus-
Registrar of Firms & another ....... Opp. parties
For Petitioner : Mr. Durga Charan Mohanty,
Sr. Advocate
M/s. Sanatan Das, Mohan
Kumar Sahoo, S.K. Swain & P.
Mohanty.
For Opp. Party No.1: Mr. Arun Kumar Misra,
Additional Government
Advocate.
For Opp. Party No.2: Mr. Yashobanta Das,
Sr. Advocate,
M/s. Rajjeet Roy, S.K. Singh &
S. Saurav.
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Date of Judgment : 29.04.2020
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P R E S E N T:
THE HONOURABLE SHRI JUSTICE K.R. MOHAPATRA
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JUDGMENT
K.R. Mohapatra, J.- This writ petition has been filed with the following prayers:
"P R A Y E R In the circumstances, the petitioner prays that this Hon'ble Court will graciously be pleased to issue (sic) rule Nisi calling upon the opp. Parties to show cause as to why the letter dated 2.3.2015 under Annexure-1, and Form- D dated 28.5.2011 and 9.8.2011 under Annexures-4 and 5 shall not be quashed, AND Why induction of the Opp. Party No.2 as partner of the Firm, Gangeya Supply Agencies shall not be quashed, AND If the Opp. Parties fail to show cause of or insufficiently show cause the said Rule may please be made absolute, AND Issue any other writ(s)/ order(s)/ direction(s) as this Hon'ble Court deems fit and proper, And for this act of kindness, the petitioner as in duty bound shall ever pray."
2. The case of the Petitioner is that he, namely, Sri Liladitya Deb, along with his siblings Siladitya Deb and Rob Ray Deb formed a partnership firm by executing Registered Partnership Deed No.6239 dated 19.12.1964 (Annexure-2). The partnership firm, namely, M/s. Gangeya Supply Agency (for short 'the Firm') was registered under the provisions of the Indian Partnership Act, 1932 (for short 'the Act') on 26.04.1979. On 02.08.1989, Siladitya Deb and Rob Ray Deb retired from the partnership. Consequently, the firm was only left with one partner, namely, the Petitioner and was reduced to a proprietorship firm. On the day Siliditya Deb and Rob Ray Deb retired from the partnership, i.e., with effect from 02.08.1989, the Petitioner also executed an agreement with M/s. Falcon Marine Exports Private Ltd. (for short 'the Company'). Subsequently, on 17.02.1993, a supplementary agreement for change in the original partnership deed was executed between the Company and the Petitioner. Both the agreements dated 02.08.1989 and 17.02.1993 between the Company and the petitioner were unregistered agreements. Mr, Mohanty learned Senior Counsel submitted that both the aforesaid agreements were outcome of fraud and misrepresentation. The Opposite Party No.2, taking undue advantage of the situation, after a lapse of more than 15 years, sought for induction of his name as a partner in the Firm on the basis of a deed named and styled as Partnership Deed (Reconstituted) executed on 01.04.1995 between the Petitioner and said Opposite Party No.2 in his individual capacity. It is his submission that due to alleged inaction of the authorities under the Act seeking for an amendment in the constitution of the Firm by inducting the opposite party No.2 as a partner in the Firm, W.P.(C) No.17542 of 2010 was filed by the Opp. Party No. 2 with a prayer to direct the opposite party No.3 therein to produce the entire records in respect of the Firm and to amend the entry relating to the Firm before the Registrar of Firms by incorporating his name in the said register in accordance with law. The said writ petition was disposed of on 09.11.2010 with the following order:
"Heard learned counsel for the petitioner.
The prayer of the petitioner is for issuance of a writ of mandamus to opposite party no.3 to produce the entire records in respect of M/s. Gangeya Supply Agency which has been entered in the Register of Firms and record an entry of the statement in the said register in accordance with Annexure-4 placing reliance on Annexure-1 series seeking information from the PIO-cum-Under Secretary to the Inspector General of Registration, Orissa. As could be seen from Annexure-2, the information sought for by the petitioner is not available. In this view of the matter, the petitioner is at liberty to file an application seeking for amendment to make the entry in the Register of Firms. If such application is filed by producing necessary material facts and documents, the same may be considered and disposed of in accordance with law. The liberty granted does not amount to expressing any opinion regarding the claim made by the petitioner in this case.
With the aforesaid observation and direction, the writ petition is disposed of.
Urgent certified copy may be granted on proper application."
3. It is the submission of Mr. Mohanty, learned Senior Counsel that pursuant to the aforesaid direction, the authority under the Act without following due procedure of law and without giving an opportunity of hearing to the Petitioner, directed to induct the Opposite Party No.2 as a new partner in the Firm and communicated same to the Petitioner vide letter dated 02.03.2005 (Annexure-1).
3.1 Mr. Mohanty learned Senior Counsel further submitted that the order under Annexure-1 has been obtained by practising fraud and suppressing material facts. On a bare perusal of the order dated 09.11.2010 (supra), it is crystal clear that no direction to induct the Opposite Party No.2 as a new partner in the Firm was issued by this Court. But the authority under the Act by misinterpreting and misreading the order dated 09.11.2010 passed in W.P.(C) No. 17542 of 2010 directed to induct the Opposite Party No.2 as a new partner in the Firm and communicated the same to the petitioner on 02.03.2015 (Annexure-1).
3.2 The authority, in order to patch up the lacuna in the order under Annexure-1 and by overreaching the interim order dated 19.03.2015 passed in Misc. Case No.4518 of 2015 in this writ petition, issued another letter dated 18.04.2015 (Annexure-13) to the Petitioner indicating that inadvertently in the order under Annexure- 1, it was mentioned that pursuant to the direction of this Court, the Opposite Party No.2 was inducted as a new partner. But, in fact, the representation of the Opposite Party No.2 was duly considered by the authority and following due procedure of law, the Opposite Party No.2 was inducted as a new partner. The induction of Opposite Party No.2 as a new partner was independent of the direction made by this Court in W.P.(C) No.17542 of 2010. Thus, both Annexures-1 and 13 are not sustainable in law. It is his submission that on the strength of Annexures-4 and 5 and some unregistered documents manufactured by Opp. Party No.2, he styling himself as the Managing Partner of the Firm tried to interfere with its management and operate a separate bank account with the banker of the Firm, namely, Canara Bank, Laxmi Sagar Branch, Bhubaneswar for which the Petitioner was constrained to request the Bank to freeze the original account of the Firm. Thereafter, the Opp. Party No.2 filed an application under Section 9 of the Arbitration and Conciliation Act, 1996 before learned District Judge, Khurda in Arb. Case No. 534 of 2014 to restrain the Petitioner from managing the affairs of the Firm and to operate the bank account, which is still pending. In view of the above, induction of the Opposite Party No.2 as a partner to the Firm and issuance of Form- D under Annexures-4 and 5 acknowledging the retirement of the Company and incorporating the Opp. Party No.2 as a partner to the Firm are per se illegal and are liable to be quashed. In support of his case, he relied upon the following case laws:
(i) State of Orissa v. Binapani Dei, reported in AIR 1967 SC 1269, wherein Hon'ble Supreme Court has observed as under:
"12. It is true that some preliminary enquiry was made by Dr. S, Mitra. But the report of that Enquiry Officer was never disclosed to the first respondent. 'Thereafter the first respondent was required to show cause why April 16, 1907, should not be accepted as the date of birth and without recording any evidence the order was passed. We think that such an enquiry and decision were contrary to the basic concept of justice and cannot have any value. It is true that the order is administrative in character, but even an administrative order which involves civil consequences as already stated must be made consistently with the rules of natural justice after informing the first respondent of the case of the State, the evidence in support thereof and after giving an opportunity to the first respondent of being heard and meeting or explaining the evidence. No such steps were admittedly taken; the High Court was, in our judgment, right in setting aside the order of the State."
(emphasis supplied)
(ii) D.F.O., South Kheri v. Ram Sanehi Singh, reported in AIR 1973 SC 205, wherein Hon'ble Supreme Court observed as under:
"5. It la unnecessary to consider whether the order of the Divisional Forest Officer is made on "irrelevant grounds" because it is clear that before passing the order the Divisional Forest Officer did not call for any explanation of the respondent, and gave him no hearing before passing the order. It is averred in Paragraph-22(i) of the petition that the "cancellation order is in violation of the principles of natural justice having been done at a very late stage without affording any opportunity to the petitioner (respondent) to say anything against the action cancelling his tallies".
To that averment, no reply was made by the forest authorities against whom the petition was filed. Granting that the order was administrative and not quasi-judicial, the order had still to be made in a manner consonant with the rules of natural justice when it affected the respondent's rights to property. This Court in the case of State of Orissa v. Dr. (Miss) Binapani Dei held in dealing with an administrative order that "the rule that a party to whose prejudice the order is intended to be passed is entitled to a hearing applied alike to judicial tribunals and bodies of persons invested with authority to adjudicate upon matters involving civil consequences. It is one of the fundamental rules of our Constitutional set-up that every citizen is protected against exercise of arbitrary authority by the State or its officers". The Divisional Forest Officer in the present case set aside the proceeding of a subordinate authority and passed an order which involved the respondent in considerable loss. The order involved civil consequences. Without considering whether the order of the Divisional Forest Officer was vitiated because of irrelevant considerations, the order must be set aside on the simple ground that it was passed contrary to the basic rules of natural justice.
6. Counsel for the appellants contended that this objection was not raised before the High Court either in the Court of First Instance or before the Division Bench. But the objection was prominently mentioned in the petition and there is no reply to it. We are unable to hold that because the High Court has not considered the question, the respondent will not be allowed to rely upon this contention in support of the order. If the plea raised by the respondent in his petition is true, and we see no reason to hold that it is not, the order challenged by him is plainly illegal and is liable to be set aside."
(iii) Mohinder Singh Gill & Anr. Vs. The Chief Election Commissioner, New Delhi & Ors., reported in AIR 1978 SC 851, wherein Hon'ble Supreme Court observed as under:
"8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad in the beginning may, by the time it comes to court on account of a challenge, get validated by additional grounds later brought out. We may here draw attention to the observations of Bose J. in Gordhandas Bhanji "Public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do.
Public orders made by public authorities are meant to have public effect and are intended to effect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself."
Orders are not like old wine becoming better as they grow older."
(iv) Km. Neelima Misra vs Dr. Harinder Kaur Paintal And Ors., reported in AIR 1990 SC 1402, wherein Hon'ble Supreme Court observed as under:
"22. An administrative order which involves civil consequences must be made consistently with the rule expressed in the Latin Maxim audi alteram partem. It means that the decision maker should afford to any party to a dispute an opportunity to present his case. A large number of authorities are on this point and we will not travel over the field of authorities. What is now not in dispute is that the person concerned must be informed of the case against him and the evidence support thereof and must be given a fair opportunity to meet the case before an adverse decision is taken. Ridge v. Baldwin, (supra) and state of Orissa v. Dr. Binapani Dei & Ors., [1967] 2 SCR 625.
23. The shift now is to a broader notion of "fairness" or "fair procedure" in the administrative action. As far as the administrative officers are concerned, the duty is not so much to act judicially as to act fairly (See: Keshva Mills Co. Ltd. v: Union of India, [1973] 3 SCR 22 at 30; Mohinder Singh Gill v. Chief Election Commissioner, [1978] 1 SCC 405 at 434; Swadeshi Cotton Mills v. Union of India, [1981] 1 SCC 664 and Management of M/s M.S. Nally Bharat Engineering Co. Ltd. v. The State of Bihar & Ors., Civil Appeal No. 1102 of 1990 decided on February 9, 1990. For this concept of fairness, adjudicative settings are not necessary, nor it is necessary to have lis inter partes. There need not be any struggle between two opposing parties giving rise to a 'lis'. There need not be resolution of lis inter partes. The duty to act judicially or to act fairly may arise in widely differing circumstances. It may arise expressly or impliedly depending upon the context and considerations. All these types of non- adjudicative administrative decision making are now covered under the general rubric of fairness in the administration. But then even such an administrative decision unless it affects one's personal rights or one's property rights, or the loss of or prejudicially affects something which would judicially be called at least a privilege does not involve the duty to act fairly consistently with the rules of natural justice. We cannot discover any principle contrary to this concept."
(emphasis supplied)
(v) S. N. Mukherjee vs Union of India, reported in AIR 1990 SC 1984, wherein Hon'ble Supreme Court observed as under:
"39. The object underlying the rules of natural justice "is to prevent miscarriage of justice" and secure "fairplay in action." As pointed out earlier the requirement about recording of reasons for its decision by an administrative authority exercising quasi-judicial functions achieves this object by excluding chances of arbitrariness and ensuring a degree of fairness in the process of decision- making. Keeping in view the expanding horizon of the principles of natural justice, we are of the opinion, that the requirement to record reason can be regarded as one of the principles of natural justice which govern exercise of power by administrative authorities. The rules of natural justice are not embodied rules. The extent of their application depends upon the particular statutory framework whereunder jurisdiction has been conferred on the administrative authority. With regard to the exercise of a particular power by an administrative authority including exercise of judicial or quasi- judicial functions the legislature, while conferring the said power, may feel that it would not be in the larger public interest that the reasons for the order passed by the administrative authority be recorded in the order and be communicated to the aggrieved party and it may dispense with such a requirement. It may do so by making an express provision to that affect as those contained in the Administrative Procedure Act, 1946 of U.S.A. and the Administrative Decisions (Judicial Review) Act, 1977 of Australia whereby the orders passed by certain specified authorities are excluded from the ambit of the enactment. Such an exclusion can also arise by necessary implication from the nature of the subject matter, the scheme and the provisions of the enactment. The public interest underlying such a provision would outweigh the salutary purpose served by the requirement to record the reasons. The said requirement cannot, therefore, be insisted upon in such a case."
3.3 He also relied upon the following decisions to buttress his argument.
(i) This Court in the case of Swastik Agency and 2 ors. Vs. State Bank of India, Main Branch and 3 ors., reported in 2009 (2) OLR 201, held as under:
"38. When the statute provides for a particular procedure, the authority has to follow the same and cannot be permitted to act in contravention of the same. It has been hither to uncontroverted legal position that, where a statute requires to do a certain thing in a certain way, the thing must be done in that way or not at all. Other methods or mode of performance are impliedly and necessarily forbidden. The aforesaid settled legal proposition is based on a legal maxim 'Expressio unius est exclusio alterius', meaning thereby that if a statute provides for a thing to be done in a particular, then it has to be done in that manner and in no other manner and following other course is not permissible. (Vide Taylor v. Taylor (1876) 1 Ch.D.426; Nazir Ahmed v. King Emperor;
Deep Chand v. State of Rajasthan: [1962] 1 SCR 662 ; Patna Improvement Trust v. Smt. Lakshmi Devi : AIR 1963 SC 1077 ; State of Uttar Pradesh v. Singhara Singh and Ors. : [1964]4SCR485 ; Hukam Chand Shyam Lal v. Union of India and Ors. : [1976]2SCR1060 ; Chettiam Veettil Ammad v. Taluk Land Board and Ors. : [1979]3SCR839 ; State of Bihar v. J.A.C. Saldanna AIR 1980 SC 327; State of Mizoram v. Biakchhawna :
(1995)1SCC156 ; J.N.Ganatra v. Morvi Municipality Morvi : AIR1996SC2520 ; Haresh DayaramThakur v. State of Maharashtra and Ors. : AIR2000SC2281 ; Dhanajaya Reddy v. State of Karnataka etc. etc. (2001) 4 SCC 9; Commissioner of Income Tax, Mumbai v. Anjum M.H. Ghaswala and Ors. : [2001]252ITR1(SC) ; Prabha Shankar Dubey v. State of Madhya Pradesh AIR 2004 SC 486; Ram Phal Kundu v.
Kamal Sharma : AIR2004SC1657 ; Indian Banks' Association v. Devkala Consultancy Service AIR 2004 SC 2615; Parle Biscuits (P) Ltd. v. State of Bihar and Ors. : 2005(192)ELT23(SC) ;
Harinarayan G. Bajaj v. Rajesh Meghani and Anr. (2005) 10 SCC; and Raja Ram Pal v. Hon'ble Speaker, Lok Sabha and Ors. : (2007)3SCC184 )."
(ii) In the case of State of Orissa and others Vs. Harapriya Bisoi, reported in (2009) 12 SCC 378, Hon'ble Supreme Court held as under:
"31. it is necessary to consider the effect of fraud.
xxx xxx xxx xxx xxx xxx
32. "Fraud" and collusion vitiate even the most solemn proceedings in any civilized system of jurisprudence. It is a concept descriptive of human conduct. Michael Levi likens a fraudster to Milton's sorcerer, Comus, who exulted in his ability to, `wing me into the easy hearted man and trap him into snares'. It has been defined as an act of trickery or deceit. In Webster's Third New International Dictionary "fraud" in equity has been defined as an act or omission to act or concealment by which one person obtains an advantage against conscience over another or which equity or public policy forbids as being prejudicial to another. In Black's Legal Dictionary, "fraud" is defined as an intentional perversion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing belonging to him or surrender a legal right; a false representation of a matter of fact whether by words or by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed, which deceives and is intended to deceive another so that he shall act upon it to his legal injury. In Concise Oxford Dictionary, it has been defined as criminal deception, use of false representation to gain unjust advantage; dishonest artifice or trick. According to Halsbury's Laws of England, a representation is deemed to have been false, and therefore a misrepresentation, if it was at the material date false in substance and in fact. Section 17 of the Indian Contract Act, 1872 defines "fraud" as act committed by a party to a contract with intent to deceive another. From dictionary meaning or even otherwise fraud arises out of deliberate active role of representator about a fact, which he knows to be untrue yet he succeeds in misleading the representee by making him believe it to be true. The representation to become fraudulent must be of fact with knowledge that it was false. In a leading English case i.e. Derry and Ors. v. Peek (1886-90) All ER 1 what constitutes "fraud" was described thus: (All ER p. 22 B-C) "fraud" is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false".
But "fraud" in public law is not the same as "fraud" in private law. Nor can the ingredients, which establish "fraud" in commercial transaction, be of assistance in determining fraud in Administrative Law. It has been aptly observed by Lord Bridge in Khawaja v. Secretary of State for Home Deptt. (1983) 1 All ER 765, that it is dangerous to introduce maxims of common law as to effect of fraud while determining fraud in relation of statutory law. "Fraud" in relation to statute must be a colourable transaction to evade the provisions of a statute. "If a statute has been passed for some one particular purpose, a court of law will not countenance any attempt which may be made to extend the operation of the Act to something else which is quite foreign to its object and beyond its scope. Present day concept of fraud on statute has veered round abuse of power or mala fide exercise of power. It may arise due to overstepping the limits of power or defeating the provision of statute by adopting subterfuge or the power may be exercised for extraneous or irrelevant considerations. The colour of fraud in public law or administration law, as it is developing, is assuming different shades. It arises from a deception committed by disclosure of incorrect facts knowingly and deliberately to invoke exercise of power and procure an order from an authority or tribunal. It must result in exercise of jurisdiction which otherwise would not have been exercised. The misrepresentation must be in relation to the conditions provided in a section on existence or non-existence of which the power can be exercised. But non-disclosure of a fact not required by a statute to be disclosed may not amount to fraud. Even in commercial transactions non-disclosure of every fact does not vitiate the agreement. "In a contract every person must look for himself and ensures that he acquires the information necessary to avoid bad bargain. In public law the duty is not to deceive. (See Shrisht Dhawan (Smt.) v. M/s. Shaw Brothers (1992 (1) SCC 534).
33. In that case it was observed as follows:
"Fraud and collusion vitiate even the most solemn proceedings in any civilized system of jurisprudence. It is a concept descriptive of human conduct. Michael levi likens a fraudster to Milton's sorcerer, Comus, who exulted in his ability to, 'wing me into the easy-hearted man and trap him into snares'". It has been defined as an act of trickery or deceit. In Webster's Third New International Dictionary fraud in equity has been defined as an act or omission to act or concealment by which one person obtains an advantage against conscience over another or which equity or public policy forbids as being prejudicial to another. In Black's Legal Dictionary, fraud is defined as an intentional perversion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing belonging to him or surrender a legal right; a false representation of a matter of fact whether by words or by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed, which deceives and is intended to deceive another so that he shall act upon it to his legal injury. In Concise Oxford Dictionary, it has been defined as criminal deception, use of false representation to gain unjust advantage; dishonest artifice or trick. According to Halsbury's Laws of England, a representation is deemed to have been false, and therefore a misrepresentation, if it was at the material date false in substance and in fact. Section 17 of the Contract Act defines fraud as act committed by a party to a contract with intent to deceive another. From dictionary meaning or even otherwise fraud arises out of deliberate active role of representator about a fact which he knows to be untrue yet he succeeds in misleading the representee by making him believe it to be true. The representation to become fraudulent must be of the fact with knowledge that it was false. In a leading English case Derry v. Peek [(1886-90) ALL ER Rep 1: (1889) 14 AC 337 (HL)] what constitutes fraud was described thus : (All Er p. 22 B-C) `Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false'."
(iii) In the case of Nakula Charan Gochhayat and others -v- Secretary, Jagaysighpur Sub-divisional House Building Co-operative Society Ltd. and others reported in 2011 (II) ILR Cuttack 767, this Court held as follows;
"45. Law is well settled that when the statute provides for a particular procedure, the authority has to follow the same and is not permitted to act in contravention of the prescribed provisions. It has been hitherto uncontroverted legal position that where a statute requires to do a certain thing in a certain way, the thing must be done in that way or not at all. Other methods or mode of performance are impliedly and necessarily forbidden. The aforesaid settled legal proposition is based on a legal maxim "Expressio unius est exclusion alteris", meaning thereby that if a statute provides for a thing to be done in a particular manner, then it has to be done in that manner and in no other manner and following other course is not permissible. (See Taylor v. Taylor, (1876) 1 Ch. D. 426; Nazir Ahmed v. King Emperor AIR 1936 PC 253; Ram Phal Kundu v. Kamal Sharma; and Indian Bank's Association v. Devkala Consultancy Service, AIR 2004 SC 2615).
xxxx xxxx xxxx xxxx xxxx xxxx
52. Law is well settled that every action of the State and its instrumentality should be fair, legitimate and above board and without any affection or aversion. (See Haji T.M. Hassan Rawther Vs. Kerala Finance Corporation, AIR 1988 SC 157; E.P. Royappa Vs. State of Tamil Nadu, AIR 1974 SC 555 and State of Andhra Pradesh & Anr., Vs. Nalla Raja Reddy, AIR 1967 SC 1458) 3.4 He therefore prayed for the aforesaid relief.
4. Mr. Das, learned Senior Counsel for the Opposite Party No.2, on the other hand, refuted the submissions made by Mr. Mohanty, learned Senior Counsel for the Petitioner. Mr. Das, learned Senior Counsel raised some preliminary objections with regard to maintainability of the writ petition.
4.1 It is his submission that the Petitioner essentially assails the letter dated 02.03.2011 under Annexure-1, Form-D dated 25.08.2011 (Annexure-4) and Form-D dated 09.08.2011 (Annexure-5) on the ground that the Opposite Party No.2 was inducted as a new partner in the Firm by misreading and misconstruing the direction of this Court in W.P.(C)No.17542 of 2010, which is not correct. Anneuxre-1 is not the order introducing the Opp.
Party No.2 as a partner in the Firm. It is a letter issued pursuant to the complaint/representation of the Petitioner made on 04.04.2014. However, the said grievance of the Petitioner does not survive to be adjudicated in view of the letter dated 18.04.2018 (Annexure-13) issued to the Petitioner in which, while explaining the circumstances on the basis of which the acknowledgement in Form-D dated 09.08.2011 was issued, it was clarified that due to inadvertence, it was indicated in Annexure-1 that the Opposite Party No.2 was inducted as a new partner to the Firm and the same was approved pursuant to the order passed by this Court in W.P. (C) No.17542 of 2010. It was further clarified in Annexure-13 that the action of the Opposite Party No.1 in issuing Form-D dated 09.08.2011 was in accordance with law and independent of the direction of this Court in W.P.(C) No.17542 of 2010. Thus, the cause of action for filing of this writ petition does not survive.
5. He submitted that in the complaint/ representation of the Petitioner dated 04.04.2014 in response to which Annexures-1 and 13 were issued, it was alleged that the Opposite Party No.2 inducted himself as a new partner in the Firm by practising fraud and by suppressing material fact. Thus, while responding to the said complaint under Annexure-1, the authority under the Act indicated that the Petitioner is at liberty to take recourse available under Section 70 of the Act, which is efficacious for the Petitioner to ventilate his grievances. It is his further submission that the Petitioner had also filed C.S. No.49 of 2016, in the Court of learned Civil Judge (Senior Division), Bhubaneswar for a declaration that the purported unregistered partnership deed dated 21.08.1989, unregistered agreement dated 02.08.1989, unregistered agreement dated 21.10.1990, unregistered supplementary agreement dated 17.02.1993 and unregistered agreement dated 01.04.1995 are fraudulent, illegal, void and not binding on the plaintiff. He had also sought for a declaration that the defendants including the Opposite Party No.2 had no manner of right, title and interest over M/s. Gangeya Supply Agency (the Firm) having its Head Office at-A-22, Cuttack Road, Bhubaneswar-6 bearing Registration No. 255/1985 along with other relief including permanent injunction. But the said suit was subsequently withdrawn by the Petitioner for the reasons best known to him. Mr. Das, thus contended that no cause of action survives for the Petitioner to maintain this writ petition.
5.1 He further submitted that the Petitioner has not come to the Court with clean hands. Elaborating his arguments on this issue, Mr. Das, learned Senior Counsel contended that partnership deed of reconstitution (executed on 01.04.1995), which the Petitioner alleged to have been fraudulently manufactured by Opposite Party No.2) amongst other documents, for his (O.P. No.2) induction as a partner to the Firm "M/s. Gangeya Supply Agency" contained a valid arbitration clause. Invoking such arbitration clause, i.e., Clause-26, the Opposite Party No.2 had approached this Court in ARBP No.5 of 2014 under Section 11 of the Arbitration and Conciliation Act, 1996 for appointment of an Arbitrator. This Court disposed of the said petition appointing Hon'ble Mr. Justice D.P. Mohapatra, a former Judge (Supreme Court of India), as the sole arbitrator to adjudicate the dispute between the parties. Thus, the Petitioner can also seek his remedy through arbitration. Pursuant to the direction of this Court dated 15.09.2016, since the Arbitrator has already entered into reference, the writ petition is incompetent and the Petitioner can raise all issues with regard to the Firm, namely, M/s. Gangeya Supply Agency, before the Arbitrator. The writ petition also suffers from delay and latches. Although the Petitioner calls in question the Form-
D issued on 28.05.2011 (Annexure-4) and 09.08.2011 (Annexure-5), acknowledging the reconstitution of the Firm carried out on 02.08.1989 and 01.04.1995, the writ application was filed only on 12.03.2015, i.e. after a lapse of more than three and half years. Further, reconstitution of the Firm made on 02.08.1989 was widely published in vernacular newspaper dated 16.12.1991 and Official Gazette dated 02.01.1992. Likewise, reconstitution of the Firm made on 01.04.1995 was also published in vernacular newspaper as well as in the Official Gazette on 28.07.2011. But, such reconstitution of the Firm has never been challenged. He thus, prayed for dismissal of the writ petition.
5.2 He further submitted the writ petition also merits no consideration. Reiterating his submission that after issuance of letter under Annexure-13, no further cause of action survives for the Petitioner to maintain this writ petition, he contended that Siladitya Deb, Rob Roy Deb and Liladitya Deb, all are sons of Sri Hara Prasad Deb of 17 Janak Road, Calcutta-29, formed a partnership firm, namely, M/s. Gangeya Supply Agency, by executing a partnership deed dated 19.12.1964 (Annexure-A/1). The Firm was registered with Registrar of Firms, Calcutta bearing Registration No. L/5940 dated 26.04.1979 (Annexure-A/2). The head office of the Firm was at 6/1, Lindsay Street, Calcutta-16. Subsequently, Government of Odisha leased out Plot No. A-22, Jharpada, Bhubaneswar to an extent of Ac. 1.31 dec. in favour of the Firm through Regd. Lease Deed No. 4188 dated 27.04.1983 (Annexure-
A/3). On 20.04.1984 the Firm made an application (Annexure-A/4) to the Registrar of Firms, Cuttack disclosing the principal place of business at 6/1 Lindsay Street, Calcutta-16 and other place of business at A-22 Cuttack Road, Bhubaneswar-6. Accordingly, Form-C was issued on 30.04.1985 (Annexure-A/5) acknowledging the entry of the Firm "Gangeya Supply Agency" in the register having Regd. No.255/1985. Subsequently, another partnership deed was executed between the partners on 30.05.1985 (Annexure-A/6) showing the head office of the Firm at A/22 Cuttack Road, Bhubaneswar-6. At the relevant time the partnership was debt-ridden. Thus, they approached M/s. Falcon Marine Exports Agency Pvt. Ltd.
(for short 'the Company') through the Opp. Party No.2- the Director to step in as a partner to revive the financial condition of the Firm. After a detailed discussion between the partners of the Firm including the Petitioner and Opp.
Party No.2 on behalf of the Company, said Siladitya and Rob Roy expressed their desire to retire from the partnership and it was also decided to induct said Company as a new partner to the Firm. Accordingly, the Company was inducted as a new partner to the Firm and said Siladitya and Rob Roy retired from the partnership.
Acknowledging the same a Deed of Partnership (Reconstituted) (Annexure-A/7) and agreement (Annexure-
A/8) dated 02.08.1989 between all of them were executed.
In terms of the agreement at Annexure-A/8, the retiring partners received rupees one lakh each by giving acknowledgment receipts (Annexure-A/9 series) and swearing affidavits (Annexures-A/10 and A/11). The Company vide its letter dated 05.09.1990 (Annexure-A/12) and the Petitioner vide an undated letter (Annexure-A/13) intimated the Orissa State Financial Corporation Ltd. (for short 'the Corporation') about the aforesaid developments.
Pursuant to the terms of the agreement at Annexure-A/8, loan dues of the Firm was repaid vide Annexure-A/14 series. The Firm also paid the premium of the lease vide Annexure-A/15 series. During continuance of the business activities by the Firm, the Petitioner by accepting Rs. 1.50 lakh from the Company expressed his interest to relinquish his 35% out of 40% share in the profit and loss of the Firm to the Company by retaining only 5% share and accordingly wrote a letter dated 22.01.1990 (Annexure-
A/16) to the Company. Accordingly, a supplementary agreement was executed between the Petitioner and the Company on 22.01.1990 (Annexure-A/17). The Firm also intimated the Registrar of Firms- Opp. Party No. 1 to effect changes as per Deed of Partnership (reconstituted) dated 02.08.1989 at Annexure-A/7. In response to the same, the Opp. Party No.1 vide its letter dated 29.01.1992 (Annexure-
A/21) raised objection with regard to induction of the Company as a partner in the Firm stating that only individuals can be partners under Section 4(27) of the Act.
The Petitioner in reply to such objection vide his letter dated 10.02.1992 (Annexure-A/22) stated that a company can be a partner to a partnership firm in its individual capacity.
5.3 In the interregnum, the Government of Odisha determined the lease granted in favour of the Firm.
Assailing the same the Firm had filed OJC No.3778 of 1991 before this Court, which was allowed vide judgment dated 31.08.1994 (Annexure-A/24) holding such determination to be erroneous. In the meantime, the Company in its resolution dated 31.03.1995 (Annexure-A/25) passed by the Board of Directors decided to retire from the Firm inducting Opp. Party No.2 as a partner. Accordingly, the Opp. Part No.2 was inducted as a partner in his individual capacity and all the rights, assets and liabilities of the Company was transferred to Opp. Party No.2. A Deed of Partnership (Reconstituted) dated 01.04.1995 (Annexure-
A/26) was also executed between the Petitioner and Opp.
Party No.2. The Opp. Party No.2 in the capacity of the Managing Partner of the Firm also made communications with the Corporation as well as the G.A. Department of the Government of Odisha. He also in the said capacity paid the electricity bills, holding tax as well as filed I.T. returns regularly on behalf of the Firm. Thus, the contention of the Petitioner that with effect from 02.08.1989, the Firm lost its partnership character and became a proprietorship Firm, is not correct.
6. It is further contended by Mr. Das leaned Senior Counsel that due to inaction of the Opp. Party No.1 to record reconstitution of the Firm made on 02.08.1989 despite communication dated 10.02.1992 (Annexure-
A/22), the Petitioner, acknowledging the reconstitution of the Firm, requested the Managing Director of the Company to submit fresh application in Form-V. Accordingly, Form-V was filed on 25.08.2005 (Annexure-A/34). In response to the said fresh Form-V application, the Opp. Party No.1 intimated the Firm vide its letter dated 24.03.2006 to submit certain documents and information. The Petitioner suppressing the same from the Opp. Party No.2, most surreptitiously, vide his letter dated 07.04.2006 (Annexure-
A/35) addressed to Opp. Party No.1 disowned the induction of the Company as a partner of the Firm. When all persuasion of the Opp. Party No.2 went in vain, he made application under the Right to Information Act to know the status of the fresh application in Form-V made on 25.08.2005 from which he came to know about the foul play of the Petitioner and filed W.P. (C) No. 17542 of 2010, which was disposed of on 09.11.2010 (supra). Since only a direction to the Opp. Party No.1 was sought for by the Petitioner to carry out necessary changes in the Register of Firms regarding reconstitution of the Firm as per the aforesaid deed of Reconstitution of the Partnership, neither the Petitioner nor the retired partners were made parties to the said writ petition. It is his submission that Section 63 of the Act empowers any incoming, continuing and outgoing partner of the firm to give notice to the Registrar of the Firms about such reconstitution. Thus, the Opp.
Party No.2 made a representation to the Opp. Party No.1 on 29.11.2010 (Annexure-A/40) in terms of Section 63 of the Act enclosing the copy of order passed by this Court in W.P.(C)No.17542 of 2010 and other documents. Thereafter, the Opp. Party No.2 also made good the requirements sought for by the Opp. Party No.1 for consideration of his representation at Annexure-A/40. Thus, after receiving the required documents as well as the information submitted by the Opp. Party No.2, the Opp. Party No.1 being satisfied, granted the acknowledgement in Form-D on 28.05.2011 (Annexure-4/Annexure-A/43) as per Rule 10(a) of the Odisha Partnership Rules, 1943 (for short 'the Rules') to the Firm recording reconstitution of the partnership.
Thereafter, the Opp. Party No.2 took step to record reconstitution of the Firm as per Deed of Partnership (Reconstituted) 01.04.1995 as at Annexure-A/26. The Opp.
Party No. 2 also fulfilled all the requirements as sought for by the Opp. Party No.1 including public notice dated 28.07.2011 (Annexure-A/47) and the paper publication dated 09.07.2011 (Annexure-A/48) as required under Section 72 of the Act. Accordingly, another Form-D acknowledging the change by incorporating the name of the Opp. Party No.2 was issued on 09.08.2011 (Annexure-
A/49/Annexure-5).
7. Mr. Das learned Senior Counsel submitted that in view of the above, the claim of the Petitioner merits no consideration. It is his submission that the grievance of the Petitioner, if any, can be redressed in a properly constituted suit and not by Opp. Party No.1, as prayed for.
In fact, the Petitioner had filed the suit in C.S. No. 49 of 2016 before learned Civil Judge (Senior Division), Bhubaneswar, which was subsequently withdrawn by him.
As such, the writ petition is liable to be dismissed.
8. In support of his case, the Opp. Party No.2 relied upon the case of Satya Pal Anand -v- State of M.P. and others reported in (2016) 10 SCC 767, paragraph-36 of which reads as follows:
"36. If the document is required to be compulsorily registered, but while doing so some irregularity creeps in, that, by itself, cannot result in a fraudulent action of the State Authority. Non- presence of the other party to the Extinguishment Deed presented by the Society before the Registering Officer by no standard can be said to be a fraudulent action per se. The fact whether that was done deceitly to cause loss and harm to the other party to the Deed, is a question of fact which must be pleaded and proved by the party making such allegation. That fact cannot be presumed. Suffice it to observe that since the provisions in the Act of 1908 enables the Registering Officer to register the documents presented for registration by one party and execution thereof to be admitted or denied by the other party thereafter, it is unfathomable as to how the registration of the document by following procedure specified in the Act of 1908 can be said to be fraudulent. As aforementioned, some irregularity in the procedure committed during the registration process would not lead to a fraudulent execution and registration of the document, but a case of mere irregularity. In either case, the party aggrieved by such registration of document is free to challenge its validity before the Civil Court."
8.1 He also relied upon the case of Oswal Fats and Oils Limited -v- Additional Commissioner (administration), Bareilly and others reported in (2010) 4 SCC 728, paragraph-20 of which reads as follows:
"20. It is settled law that a person who approaches the Court for grant of relief, equitable or otherwise, is under a solemn obligation to candidly disclose all the material/important facts which have bearing on the adjudication of the issues raised in the case. In other words, he owes a duty to the court to bring out all the facts and refrain from concealing/suppressing any material fact within his knowledge or which he could have known by exercising diligence expected of a person of ordinary prudence. If he is found guilty of concealment of material facts or making an attempt to pollute the pure stream of justice, the court not only has the right but a duty to deny relief to such person."
8.2 Hence, he prayed for dismissal of the writ petition with cost.
9. Mr. Mishra learned Additional Government Advocate appearing for Opp. Party No.1 also refuted the submissions of the Petitioner. With reference to the Counter Affidavit filed by the Opp. Party No.1 he submitted that as would reveal from the Form-V dated 25.08.2005 at Annexure-A/34 as well as Deed of Reconstitution of the Partnership executed on 02.08.1989 at Annexure-A/7, it is crystal clear that the Firm was never left with one Partner namely, the Petitioner, after retirement of Siladitya and Rob Roy, as alleged. The aforesaid two documents, i.e., Annexures-A/34 and A/7 make it clear that the retirement of Siladitya and Rob Roy as well as induction of the Company was simultaneous. It is his submission that in order to comply with the direction of this Court in W.P.(C) No.17542 of 2010, the Petitioner was duly intimated vide letter no. 2939 dated 04.05.2011 (Annexure-B/1) to produce certain documents so that the claim for recording changes in reconstitution by admitting the Company as a partner in the Firm can be considered. Upon receipt of the documents and information and following due procedure of law Form-D dated 28.05.2011 (Annexure-4/Annexure-A/43) as per Rule 10(a) of the Rules was issued. Likewise, after receipt of the form-V dated 07.06.2011 (Annexure-A/44) along with required documents from the Firm for recording reconstitution of the Firm by acknowledging retirement of the Company and introduction of Opp. Party No.2 as a partner, the Opp. Party No.1 issued notice to the Petitioner vide letter No.4638 dated 05.07.2011 (Annexure-G/1) to take steps as per law to register the aforesaid reconstitution of the Firm. After compliance of the requirements by the Firm and following due procedure of law, the Opp. Party No.1 issued Form-D on 09.08.2011 (Annexure-A/49/ Annexure-5) acknowledging the change as aforesaid. Although the Petitioner was duly intimated and he had sufficient knowledge about the recording of reconstitution of the Firm, he has not raised any objection to the same at any stage. Only after issuance of Form-D, the Petitioner made representation on 04.04.2014 (Annexure-6) and he was duly replied vide letter dated 02.03.2015 (Annexure1) to take steps as per law. It is submitted that there is no provision under the Act and Rules to effect rectification in the partnership deed. Form- V can be submitted by any continuing, incoming or outgoing partner as envisaged in Section-63 of the Act and there is no requirement of signing the Form-V by all the partners of any partnership firm, as alleged. It is also submitted Mr. Mishra that after issuance of Annexure-13, the Petitioner does not have any cause of action either to file or maintain this writ petition. Hence, he prayed for dismissal of the writ petition.
10. Heard leaned counsel for the parties at length. Perused the documents placed. On an analysis of the pleadings as well as argument advanced by Mr. Mohanty, leaned Senior Counsel it appears that the Petitioner takes exception to the induction of the Company and on its retirement, the induction of the Opp. Party No.2 as a partner in the Firm. Although the Petitioner has not made any specific prayer challenging the letter under Annexure-13, but the pleadings of the writ petition as well as the rejoinder leave no iota of doubt that the Petitioner assails the legality of letter under Annexure-13 as well. In order to meet the ends of justice this Court in exercise of extra ordinary jurisdiction under Article 226 of the Constitution has the discretion to grant relief not specifically prayed for. The Court should not refuse to grant any relief on the ground that it is not specifically prayed for. But, before granting any relief, not specifically prayed for, the Court must record its satisfaction that firstly, there is no legal impediment to grant such a relief; secondly, there are sufficient material on record to grant such a relief; thirdly, the adversary has got sufficient opportunity to have his say in the matter; and fourthly, the relief to be granted does not in any way contradict or oppose the relief already sought for. Be that as it may, in the instant case both Annexres-1 as well as 13 are mere communications in response to the representation dated 04.04.2014. Annexure-13 is a clarification to the communication made under Annexure-
1. Thus, granting the relief by setting aside the communications made under Annexures-1 and 13 will not wipe out the effect of the decision already taken by Opp. Party No.1 in acknowledging the introduction of either the Company as a partner or, on its retirement, induction of the Opp. Party No.2 as a partner in the Firm and thereby issuing Form-D under Annexres-4 and 5 (which are also annexed as Annexures-A/43 and A/49 respectively, by Opp. Party No.2 to his Counter Affidavit). Thus, the contention of Opp. Party Nos.1 and 2 to the effect that after issuance of Annexure-13 no cause of action survives for the Petitioner to maintain this writ petition, is not sustainable.
11. Mr. Mohanty learned Senior Counsel vehemently argued that the Form-D under Annexures-4 and 5 have been issued in contravention of the provisions of the Act and the Rules and without affording an opportunity of hearing to the Petitioner. It is the submission of Mr. Mohanty that the Company is a tenant under the Petitioner in the leasehold premises. The Opp. Party No.2 being the Director of the said Company had a good relationship with the Petitioner. Thus, in good faith the Petitioner had given him some blank Non-judicial Stamp Papers signed by him. The Opp. Party No.2 by mis- utilising the said non-judicial stamp papers and by practising fraud manufactured the unregistered deed of Partnership (Reconstituted) dated 02.08.1989 as at Annexure-4 (also Annexure-A/7) inducting the Company as a partner in the Firm. Likewise, the Opp. Party No.2 also manufactured an unregistered agreement dated 22.01.1990 (Annexure-9) enhancing his share in the Firm to 95% and thereby reducing the share of the Petitioner to 5%. The Opp. Party No.2 on the basis of such unregistered deed at Annexure-9 applied for reconstitution of the partnership of the Firm. He also filed W.P.(C) No.17542 of 2010 as aforesaid without impleading the Petitioner as party to the said writ petition. Thus, the order passed in W.P. (C) No.17542 of 2010 (supra) was an outcome of suppression of material facts. Had the Petitioner been given an opportunity of hearing in the said writ petition, he could have placed the correct state of affair. Mr. Das, learned Senior Counsel submitted that in view of the nature of prayer made in the said writ petition which was only for reconstitution of the Firm as per the deed at Annexure-8 (Annexure-A/7), the Petitioner was not made a party therein, as he was neither a necessary nor proper party to the said writ petition. Mr. Mohanty, learned Senior Counsel further submitted that the Opp. Party No.1 after receiving both the Form-V, i.e., dated 25.08.2005 (Annexure-A/1 series) for induction of the Company as well as Form-V dated 07.11.2011 (Annexure-E/1) for induction of Opp. Party No.2, did not issue any notice to the Petitioner. Form-D as under Annexures-4 and 5 were issued without giving the Petitioner an opportunity of being heard. Although Mr. Mishra, learned Additional Govt. Advocate appearing for the Opp. Party No.1 submits that after receiving Form-V as at Annexure-A/1 series as well as Annexure-E/1, notices vide Annexures-B/1 and G/1 respectively were issued to the Petitioner, but materials on record do not inspire confidence to come to a conclusion that notice was, in fact, served on the Petitioner. On the other hand, the requirements sought for in the said letters were complied with by the Opp. Party No.2 himself. Thus, prima facie it appears that the Petitioner was not served with any notice before issuance of Form-D under Annexures-4 and 5. Section 63 of the Act provides that when a change occurs in the constitution of the Firm any outgoing, incoming or continuing partner or their agent(s) especially authorised in that behalf may give notice to the Registrar of the Firms intimating such change specifying the date thereof. Rule 4 read with Rule 10 (a) of the Rules provide that it should be in Form-V. Accordingly, the Opp. Party No.2 had submitted Form-V in the capacity of a Director of the Company (Annexure-A/1 series) at the first instance and in his individual capacity (Annexure-E/1) on the subsequent occasion. The signature of the Petitioner was not required on both the Form-V as those were signed and submitted by the Opp. Party No.2. On receipt of the notices in Form-V, on both the occasions the Opp. Party No.1 appears to have complied with the provisions under the Act. It appears from the Counter Affidavit filed by the Opp. Party No.1 that the form-V dated 25.08.2005 under Annexure-A/1 series was accompanied by the Deed of Reconstitution of Partnership dated 02.08.1989 (Annexure- A/7). After disposal of W.P.(C) No.17542 of 2010, the Opp. Party No.1 vide letter dated 04.05.2011 (Annexure-B/1) intimated the Petitioner to comply with certain requirements, which was complied with by the Opp. Party No.2. It is contended by the Opp. Party No.2 that after receipt of Form-V, the Opp. Party No.1 had issued letter dated 07.04.2006 (Annexure-A/35) to the Petitioner to produce certain documents, which was suppressed by the Petitioner and he did not take any step pursuant to the said letter. Be that as it may, no specific allegation with regard to the procedural lapses except non-compliance of principles of natural justice has been made by the Petitioner. However, Opp. Party No.1 upon receipt of the required documents from Opp. Party No.2 and following due procedure of law issued Form-D (Annexure-4) acknowledging reconstitution of the Firm. Likewise, on the second occasion, the Opp. Party No.1, after receiving Form- V dated 07.11.2011 (Annexure-E/1) issued notice to the Petitioner on 05.07.2011 (Annexure-A/46/ Annexure-G/1) to comply with Section 72 of the Act. Accordingly, notice was published in the vernacular newspaper on 09.07.2011 (Annexure-A/48/ Annexure-H/1) as well as in the Official Gazette on 28.07.2011 (Annexure-A/48/ Annexure-J/1). Thereafter, Form-D dated 09.08.2011 (Annexure-A/49) was issued acknowledging reconstitution of the Firm. Prima facie, there appears no irregularity in issuing Form- D as under Annexures-4 and 5. The fact remains that the Opp. Party No.2 at the first instance submitted Form-V vide Annexure-A/1 series (Annexure-A/34) on 25.08.2005 basing upon the unregistered Deed of Partnership (Reconstituted) dated 02.08.1989 as at Annexure-A/7, whereby the Company was inducted as a partner in the Firm. Subsequently, the Opp. Party No.2 submitted Form-V on 07.11.2011 (Annexure-E/1) basing upon the unregistered Deed of Partnership (Reconstituted) dated 01.04.1995 (Annexure-A/26). The Petitioner disputes the genuineness of those unregistered deeds alleging that those deeds were obtained by practising fraud. It is also not in dispute that the Petitioner had filed C.S. No. 49 of 2016 to declare the aforesaid deeds to be null and void and not binding on him along with other prayers, which was subsequently dismissed as withdrawn vide order dated 21.02.2017 passed by learned Civil Judge (Senior Division), Bhubaneswar on the basis of a petition filed by the Petitioner to that effect. The aforesaid fact has been brought to the notice of this Court by the Opp. Party No.2 by filing an additional affidavit, which is also not disputed by the Petitioner. The Opp. Party No.2 was a party to the said suit. As held in Satya Pal Anand (supra) the Civil Court is only competent to look into the grievance of the Petitioner, so far as the genuineness of the deeds basing upon which the changes in constitution of the Firm was recorded. Further, taking into consideration the allegation made, the Petitioner is at liberty to seek remedy under Section 70 of the Act. Thus, this Court is not competent to delve into those aspects, which requires factual adjudication.
12. The Petitioner, however, raises a vital issue of non-compliance of principle of natural justice alleging that he was not given reasonable opportunity to bring some relevant facts to the notice of Opp. Party No.1 before issuance of Annexures-4 and 5. Had he given an opportunity, he could have brought the fraudulent action of the Opp. Party No.2 to the notice of Opp. Party No.1. In reply, learned counsel for the Opp. Party Nos.1 and 2 with reference to the pleadings as well as documents filed by them made elaborate submission making an endeavour to justify that principle of audi alteram partem has been followed. As discussed above, although some materials are placed by both the Opp. Parties to show that notices were served on the Petitioner before issuance of Form-D under Annexures-4 and 5, but it will not be safe to conclusively hold that notice was, in fact, served on the Petitioner basing upon those materials. True it is that the provisions under the Act and Rules do not provide for any intimation to all the partners before issuance of Form-D, as alleged. Law is well-settled in the case of Neelima Mishra and S. N. Mukherjee (supra) to the effect that in the matter of administrative actions also the authority must adopt fair procedure to avoid any arbitrariness. The principle of audi alteram partem is an inbuilt mechanism in all administrative actions, even if there is no lis inter partes and procedure laid down in the relevant law does not expressly provide for the same. It is held in the said case law that the concept of fairness does not pre-empt any adjudicative proceeding, nor it is necessary to have lis inter partes. There need not be any struggle between two opposing parties giving rise to a 'lis'. There need not be resolution of lis inter partes. The duty to act judicially or to act fairly may arise in widely differing circumstances. It may arise expressly or impliedly depending upon the context and considerations. All these types of non- adjudicative administrative decision making process are now covered under the general rubric of fairness in the administration. But then even such an administrative decision unless it affects one's personal rights or one's property rights or prejudicially affects something which would judicially be called at least a 'privilege' does not involve the duty to act fairly consistently with the rules of natural justice. As it appears, in the instant case the Petitioner had raised objection to the induction of the Company as a partner in the Firm. It is also the specific case of the Opp. Party No. 2 that after submission of Form-V on 24.08.2005, the Opp. Party No.2 vide his letter dated 07.04.2006 (Annexure-A/35) addressed to Opp. Party No.1 disowning the induction of the Company as a partner of the Firm. Thus, admittedly, there exists a serious dispute with regard to the induction of the Company and subsequently the Opp. Party No.2 as partner in the Firm. It also reveals from the record that the Opp. Party No.1 vide its letter dated 29.01.1992 (Annexure-A/21) raised objection with regard to induction of the Company as a partner in the Firm stating that only individuals can be partners under Section 4(27) of the Act. The Petitioner in the capacity of a partner of the Firm replied to such objection vide his letter dated 10.02.1992 (Annexure-A/22) stating that a Company can be a partner to a firm in its individual capacity.
13. Before coming to a definite conclusion with regard to adherence of the principle of natural justice, one thing must be kept in mind that there cannot be any straitjacket formula for application of the principle of natural justice. Application of principle of natural justice is not an empty formality. Hon'ble Supreme Court in the case of Dharampal Satyapal Limited -v- Deputy Commissioner of Central Excise, Gauhati and others reported in (2015) 8 SCC 519 has held as follows;
"38. But that is not the end of the matter. While the law on the principle of audi alteram partem has progressed in the manner mentioned above, at the same time, the Courts have also repeatedly remarked that the principles of atural justice are very flexible principles. They cannot be applied in any strait-jacket formula. It all depends upon the kind of functions performed and to the extent to which a person is likely to be affected. For this reason, certain exceptions to the aforesaid principles have been invoked under certain circumstances. For example, the Courts have held that it would be sufficient to allow a person to make a representation and oral hearing may not be necessary in all cases, though in some matters, depending upon the nature of the case, not only full-fledged oral hearing but even cross- examination of witnesses is treated as necessary concomitant of the principles of natural justice. Likewise, in service matters relating to major punishment by way of disciplinary action, the requirement is very strict and full-fledged opportunity is envisaged under the statutory rules as well. On the other hand, in those cases where there is an admission of charge, even when no such formal inquiry is held, the punishment based on such admission is upheld. It is for this reason, in certain circumstances, even post- decisional hearing is held to be permissible. Further, the Courts have held that under certain circumstances principles of natural justice may even be excluded by reason of diverse factors like time, place, the apprehended danger and so on.
39. We are not concerned with these aspects in the present case as the issue relates to giving of notice before taking action. While emphasizing that the principles of natural justice cannot be applied in strait-jacket formula, the aforesaid instances are given. We have highlighted the jurisprudential basis of adhering to the principles of natural justice which are grounded on the doctrine of procedural fairness, accuracy of outcome leading to general social goals, etc. Nevertheless, there may be situations wherein for some reason - perhaps because the evidence against the individual is thought to be utterly compelling - it is felt that a fair hearing 'would make no difference' - meaning that a hearing would not change the ultimate conclusion reached by the decision-maker - then no legal duty to supply a hearing arises. Such an approach was endorsed by Lord Wilberforce in Malloch v. Aberdeen Corporation, who said that (WLR p. 1595: All ER p. 1294) "A 'breach of procedure...cannot give (rise to) a remedy in the courts, unless behind it there is something of substance which has been lost by the failure. The court dos not act in vain."
Relying on these comments, Brandon LJ opined in Cinnamond v. British Airports Authority that (WLR p. 593: All ER p. 377) "...no one can complain of not being given an opportunity to make representations if such an opportunity would have availed him nothing."
In such situations, fair procedures appear to serve no purpose since 'right' result can be secured without according such treatment to the individual.
40. In this behalf, we need to notice one other exception which has been carved out to the aforesaid principle by the Courts. Even if it is found by the Court that there is a violation of principles of natural justice, the Courts have held that it may not be necessary to strike down the action and refer the matter back to the authorities to take fresh decision after complying with the procedural requirement in those cases where non- grant of hearing has not caused any prejudice to the person against whom the action is taken. Therefore, every violation of a facet of natural justice may not lead to the conclusion that order passed is always null and void. The validity of the order has to be decided on the touchstone of 'prejudice'. The ultimate test is always the same, viz., the test of prejudice or the test of fair hearing."
13.1 Same view is taken in the case of Ashwin S. Mehta and another -v- Union of India and others reported in (2012) 1 SCC 83 while discussing the applicability of principle of natural justice.
14. On a conspectus of the case law referred to above vis-a-vis materials available in connection with the issue involved in this case, it emerges that directing the Opp. Party No.1 to give the Petitioner an opportunity of hearing will be an empty formality and will yield no fruitful outcome for the following reasons;
(a) The Petitioner had filed C.S. No.49 of 2016, which was dismissed as withdrawn vide order dated 21.02.2017 passed by learned Civil Judge (Senior Division), Bhubaneswar. Thus, the prayer for a declaration that the purported unregistered partnership deed dated 21.08.1989, unregistered agreement dated 02.08.1989, unregistered agreement dated 21.10.1990, unregistered supplementary agreement dated 17.02.1993 and unregistered agreement dated 01.04.1995 are fraudulent, illegal, void and not binding on the plaintiff (the Petitioner), is no more available to be challenged, unless said order is set aside by a competent Court. The prayer in the said suit for a declaration that the defendants (including the Opposite Party No.2) have no manner of right, title and interest over the Firm is also no more available to be granted. But, the fact remains that on the basis of the aforesaid deeds the Opp. Party No.2 submitted Form-V and consequently Form-D under Annesures-4 and 5 were issued. Thus, unless the aforesaid documents are set aside or declared null and void and not binding on the Petitioner, the Opp. Party No.1 will not be in a position to redress the grievance of the Petitioner. Further, the Opp. Party No.1 has no power to review its own action / order as under Annexures-4 and 5.
(b) In addition to the above, the ratio decidendi in the case of Satya Pal Anand (supra) gives a clear picture that if a document is required to be registered compulsorily (as under Section 69 of the Act), but while doing so if some irregularity has crept in, that by itself cannot be said to be a fraudulent action. The allegation of fraud has to be pleaded and proved by the party making it. The presumption of fraud or misrepresentation howsoever strong may be cannot take the place of proof. It is categorically held therein that the party who feels aggrieved by such registration is free to challenge the same in a civil suit, that is what exactly done by the Petitioner in this case. But, the Petitioner subsequently changed his mind and withdrew the suit.
(c) The Petitioner alleges that the Opp. Party No.2 has fraudulently obtained the deeds and agreements relying upon which he has obtained the impugned Annexures-4 and 5. Thus, the Petitioner impliedly alleges that the Opp. Party No.2 had signed the Form-V notices on both the occasions knowing well that those were submitted basing upon incorrect and incomplete statements. As such, the grievance of the Petitioner can be taken care of under Section 70 of the Act. The Authority under the Act in his reply under Annexure-1 has also suggested the same to the Petitioner.
(d) As discussed earlier, arbitration proceedings concerning the grievances of the parties are also pending. 14.1 Thus, no fruitful purpose will be served by remitting the matter to the Opp. Party No.1 to give a relook into it by affording the Petitioner to have his say. Hence, I am not inclined to accede to the prayer of the Petitioner. But, that does not preclude the Petitioner from availing the remedy prescribed under law.
15. The writ petition is, accordingly disposed of with the observations made above. No cost.
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(K. R. Mohapatra, J) Orissa High Court, Cuttack Date the 29th day of April, 2020/ss