Delhi District Court
Col K S Ahluwalia vs Through Its Directors on 2 August, 2025
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In the court of Sh. Umed Singh Grewal, District Judge-
Commercial Court-02, North District
Rohini Courts, Delhi.
CS (Comm) No. : 389/2023
In the matter of :
M/s Jagdish Filling Station
through its partner Mr. Col. (Retd.) K. S. Ahluwalia,
Having its office/filling station at Section-16,
Rohini, Delhi - 110085 .... Plaintiff
Vs.
M/s Rana Travels Private Ltd.
Through its director
Having its office at
Plot No. 8, Shahbad Extension,
Pocket 6, Sector - 17, Delhi - 110085 .... Defendant
Date of Institution : 15.07.2023
Date on which arguments were concluded : 22.07.2025
Date of pronouncement of order : 02.08.2025
Present: Sh. Atul Jain, Ld. Counsel for plaintiff.
Sh. Nitin Ahlawat, Ld. Counsel for defendant.
JUDGMENT:-
1. This is an ordinary suit for recovery of Rs. 12,03,964/- with pendent-lite and future interest and cost.
2. The plaintiff, a partnership firm, is authorised dealer of M/s Bharat Petroleum Corporation and sells petrol and diesel at Digitally CS (COMM) No.: 389/23 signed by Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 1/17 UMED UMED SINGH SINGH Date:
2025.08.02 16:39:04 +0530 ~2~ its pump and it has authorised one of its partner Sh. K. S. Ahluwalia, on the strength of partnership deed executed on 01.02.2022, to file the suit. The defendant is a company registered under relevant company law and is engaged in transport business owning several trucks, buses and cars for which it used to purchase fuel from plaintiff's petrol station on credit basis even prior to 2014. There was some outstanding amount against the defendant which it cleared during the days of demonitisation in November, 2016. But it purchased some more fuel on credit from 20.12.2016 to 24.12.2018 due to which the outstanding amount escalated to Rs. 16,53,964/- on 24.12.2018. The defendant made some payment on different dates from 08.06.2020 to 05.12.2022 after discounting of which the balance amount is Rs. 12,03,964/- which the defendant did not pay despite service of legal notice dated 14.12.2022.
3. The defendant admitted in written statement that it used to purchase fuel from defendant on credit basis and during that period, the affairs of the plaintiff used to be taken care of by one Mr Ritu Raj @ Neeraj who is in-charge of all works of the plaintiff and it was he who used to represent plaintiff in all dealings with the defendant. It was he who used to maintain the record of supply of fuel and payment. The defendant had two bank accounts during those days - one in HDFC bank and another in Punjab National Bank. The outstanding amount was CS (COMM) No.: 389/23 Digitally Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 2/17 signed by UMED UMED SINGH SINGH Date:
2025.08.02 16:39:11 +0530 ~3~ transferred to the bank account of the plaintiff in Canara bank from those accounts. The whole amount was cleared till 28.02.2019 and thereafter, there was no reason or occasion for the defendant to pay amount of Rs. 4,92,623/- from 08.06.2020 to 05.12.2022 as alleged by the plaintiff. It is next mentioned that as per para nos. 6 and 7 of the plaint, the defendant made payment of Rs. 4,92,623/- and thereafter the outstanding amount of Rs. 16,53,964/- came down to Rs. 12,03,964/- but that assertion is absolutely incorrect because if the paid amount is subtracted from the outstanding amount, the balance comes out to Rs. 11,61,323/- and not Rs. 12,03,964/-. It is next mentioned that after making of complete payment on 28.02.2019, no fuel was purchased from the plaintiff.
The legal objections are that the plaintiff firm came into existence with the execution of partnership deed dated 01.02.2022. But after 28.02.2019, no fuel was purchased from plaintiff and hence no deal ever took place with the new firm constituted on 01.02.2022. Moreover, the said firm is not the registered one.
It is further mentioned that the old firm was dissolved in 2014 after the death of father of remaining two partners and thereafter the firm might have been reconstituted whose registration papers have not been filed. So, suit is barred by Section 69 (2) CPC of the Partnership Act.
CS (COMM) No.: 389/23 Digitally
signed by
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 3/17 UMED
UMED SINGH
SINGH Date:
2025.08.02
16:39:18
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4. Following issues were framed on 02.07.2024 :-
1. Whether the plaintiff is entitled to decree in the sum of Rs.
12,03,964/- as prayed for ? ... OPP
2. Whether the plaintiff is entitled to any interest and if so, at what rate, at what amount and for what period ? .... OPP
3. Relief.
5. In order to prove the case, the plaintiff examined Mr. K S Ahluwalia as PW1 who repeated the contents of plaint in his affidavit in evidence Ex. PW1/A and relied upon following documents :-
I. Ex. PW1/1 is copy of partnership deed.
II. Ex. PW1/2 is authorisation letter.
III. Ex. PW1/3 (colly) are sales invoices.
IV. Ex. PW1/4, Ex. PW1/4A and Ex. PW1/4B are ledger account of the defendant maintained by the plaintiff. V. Ex. PW1/5 is legal notice dated 14.12.2022.
VI. Ex. PW1/6 is postal receipt.
VII. Ex. PW1/7 is tracking report.
VIII. Ex. PW1/8 is non-starter report.
IX. Ex. PW1/9 is copy of registration certificate of plaintiff partnership firm.
X. Ex. PW1/10 (colly) are copies of ITRs.
XI. Ex. PW1/11 is certificate under Section 63 B of BSA.
Digitally
CS (COMM) No.: 389/23 signed by
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 4/17 UMED
UMED SINGH
SINGH Date:
2025.08.02
16:39:27
+0530
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6. The defendant examined one of its directors Mr. Ajay Singh Rana as DW1 who deposed that the plaintiff, a partnership firm, consists of 3 partners namely Sh. Kanwarjit Singh Ahluwalia, Sh. Arvinderjeet Singh Ahluwalia and Sh. Sudhakar Bansiwal and it came into existence on 01.02.2022 with the execution and registration of partnership deed dated 01.02.2022 in the office of sub-registrar. But it was not registered with Registrar of Firm, Delhi and hence the suit is barred by Section 69 (2) of the Partnership Act, 1932 as it has been filed by an unregistered firm. He next deposed that the defendant had business relationship with plaintiff from 2016 to 2019 and at that time, the name of the firm was M/s Jagdish Fueling Station which was an old firm and different from the present plaintiff.
Whatever dealing it had with that firm, the payment has already been made and nothing is outstanding. He relied upon following documents :-
I. Ex. DW1/1 is board resolution dated 11.10.2023.
II. Ex. DW1/2 is ledger account of the defendant from 01.01.2017 to 31.03.2019.
III. Ex. DW1/3 is certificate under Section 65B of Indian Evidence Act.
Issue no. 1
7. Learned counsel for defendant argued that his client had business relationship with the erstwhile firm comprising of CS (COMM) No.: 389/23 Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 5/17 Digitally signed by UMED UMED SINGH SINGH Date:
2025.08.02 16:39:35 +0530 ~6~ three partners namely Sh. Gurdyal Singh Ahluwalia, Sh. Kanwarjit Singh Ahluwalia and Sh. Arvinderjit Singh Ahluwalia. Whatever amount was due till 28.02.2019, has already been paid and thereafter not a single drop of fuel was purchased from plaintiff. In this regard, he relied upon the ledger account of the defendant.
He next argued that the suit has been filed by M/s Jagdish Filling Station i.e. by a firm which came into existence on 01.02.2022 vide partnership deed Ex. PW1/1 which was registered in the office of Sub-Registrar, New Delhi. But the said firm is quite different from the old firm by the same name comprising of three partners namely Sh. Gurdyal Singh Ahluwalia, Sh. Kanwarjit Singh Ahluwalia and Sh. Arvinderjit Singh Ahluwalia. From new firm, the defendant never purchased any fuel. Moreover, the new firm is not registered one. So, the suit is barred by the provisions of Section 69 (2) of Partnership Act.
About old firm by the same name, he argued the firm comprised of Sh. Gurdyal Singh Ahluwalia, Sh. Kanwarjit Singh Ahluwalia and Sh. Arvinderjit Singh Ahluwalia but Mr. Gurdyal Singh Ahluwali expired in 2014 leaving behind two sons as partners. As per the Section 42 of Partnership Act unless otherwise agreed, the partnership comes to an end after death of one of the partner. In the case in hand, one of the partner, who was father of remaining two partners, expired in 2014 and hence Digitally CS (COMM) No.: 389/23 signed by Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 6/17 UMED UMED SINGH SINGH Date:
2025.08.02 16:39:51 +0530 ~7~ the firm was dissolved on that very day because the plaintiff has failed to place on record the partnership deed in which it may be mentioned that the firm shall not dissolve in case of death of one of the partner. As the firm was dissolved in 2014 and thereafter the remaining two partners would have reconstituted the firm, then they should have got it registered with registrar of firm which they did not and hence the suit would not have been maintainable even if it had been filed by old firm.
8. Learned counsel for plaintiff replied that his client used to maintain current running account of all transactions with the defendant in ordinary course of business. Such ledger accounts from 01.04.2017 onwards have been placed on record as Ex. PW1/4, Ex. PW1/4A and Ex. PW1/4B which are corroborated by the bills Ex. PW1/3 (colly) from 16.05.2018 to 31.05.2018 and so on. Moreover, it is not the case of the defendant that it did not purchase fuel from the plaintiff and rather, its plea is that though it had purchased fuel but the same has already been paid. So, the case is of complete payment and hence that fact was required to be proved by the defendant which it has failed.
He admitted in so many words that the new firm constituted on 01.02.2022 is not registered with the Registrar of Firms, Delhi but the old firm was definitely registered with the Registrar.
CS (COMM) No.: 389/23 Digitally
signed by
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 7/17 UMED
UMED SINGH
SINGH Date:
2025.08.02
16:40:09
+0530
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9. The outstanding amount was Rs. 5,29,230/- against defendant when the financial year ended on 31.03.2017 and that is why that amount was carried forward in new financial year on 01.04.2017, as mentioned in ledger account Ex. PW1/4. That financial year ended on 31.03.2018 with a balance of Rs. 16,15,404/- which was carried forward, as mentioned in ledger account Ex. PW4/A, when the new financial year started on 01.04.2018. That financial year came to an end on 24.12.2018 when the last drop of fuel was purchased from plaintiff and the outstanding amount on that day was Rs. 16,53,964/- which was carried forward in the next financial year as mentioned in the ledger account from 01.04.2019 to 31.03.2020. In that financial year, the plaintiff made payment of Rs. 2,00,000/- in cash from 08.06.2020 to 02.03.2021 and the outstanding amount was Rs. 14,53,964/- at the end of the financial year which was carried forward in the next financial year, as shown in the ledger account Ex. PW1/4B from 01.04.2021 to 31.03.2022. In that financial year, the defendant made payment of Rs. 25,000/- each 10 times from 26.07.2021 to 05.12.2022 and thereafter the final outstanding amount was Rs. 12,03,964/- for recovery of which the suit has been filed.
As per Section 34 of Indian Evidence Act, the entries in ledger account are not sufficient themselves to fasten the liability around the neck of the defendant. Some other piece of evidence should be there to corroborate those entries. In the case Digitally CS (COMM) No.: 389/23 signed by Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 8/17 UMED UMED SINGH SINGH Date:
2025.08.02 16:40:15 +0530 ~9~ in hand, the plaintiff is relying upon bill/ cash memo Ex. PW1/3 (colly) from 16.05.2018 to 31.05.2018, 01.06.2018 to 13.06.2018, 16.06.2018 to 30.06.2018, 01.07.2018 to 14.07.2018, 15.07.2018 to 31.07.2018, 01.08.2018 to 15.08.2018, 16.08.2018 to 31.08.2018, 01.09.2018 to 15.09.2018, 17.09.2018 to 30.09.2018, 01.10.2018 to 31.10.2018 and from 01.12.2018 to 31.12.2018.
Moreover, it is not the case of the defendant that it did not purchase fuel from the plaintiff as mentioned in ledger account. Rather its case is that whatever was due till 28.02.2019, the complete payment has been made. After taking of that kind of plea, it can be said that defendant has admitted the purchase of fuel as mentioned in ledger account Ex. PW1/4, Ex. PW1/4A and Ex. PW1/4B and bills Ex. PW1/3 (colly). So, the entries of ledger account are well corroborated and also admitted and hence are being taken into account.
10. The plea of the defendant is that it made complete payment of the outstanding amount, till 28.02.2019. Now, let us see whether the defendant has proved that plea or not.
The ledger account Ex. DW1/2 of the defendant is in great variance with the ledger account of the plaintiff as Ex. PW1/4, Ex. PW1/4A and Ex. PW1/4B. As per ledger account of defendant, the new financial year had started on 01.04.2017 with a balance of Rs. 4,44,717/- against it but as per ledger account of CS (COMM) No.: 389/23 Digitally signed by Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 9/17 UMED UMED SINGH SINGH Date:
2025.08.02 16:40:26 +0530 ~ 10 ~ the plaintiff, that year had started with a balance of Rs. 5,29,230/-. As per the ledger account of the defendant, another new financial year started on 01.04.2018 with a balance of Rs. 14,58,404/- against it but the ledger account of the plaintiff shows the balance of Rs. 16,15,404/- on that day. The ledger account of the defendant shows zero balance towards defendant as on 28.02.2019 but as per ledger account of the plaintiff, the last sale transaction between the parties in that financial year took place on 24.12.2018. On that day, the defendant had purchased fuel of Rs. 52,050/- lastly and thereafter, no delivery transaction took place. The defendant did not make payment in that financial year after 10.08.2018.
As per ledger account of the defendant, the defendant made payment of Rs. 3,71,800/- in cash and Rs. 3,72,353/- through bank to the plaintiff making total as Rs. 7,44,153/-. Those payments are not reflected in the ledger account of the plaintiff. So, the main difference between ledger account of both parties is regarding those very payments. As it is the case of the defendant that it made payment of Rs. 3,72,353/- to defendant from 01.12.2018 to 28.02.2019 through bank, the evidence was definitely available with it to prove that contention as it could have summoned a witness from the bank to prove that payment but the defendant did not examine any witness from its bank. It did not file its bank statement to prove that payment and also, it did not examine any witness in whose presence the cash payment CS (COMM) No.: 389/23 Digitally Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 10/17 signed by UMED UMED SINGH SINGH Date:
2025.08.02 16:40:32 +0530 ~ 11 ~ of Rs. 3,71,860/- was made from 01.02.2018 to 28.02.2018. It did not file any receipt to that effect. So, the defendant has failed to prove that it made payment of Rs. 7,44,153/- from 01.12.2018 to 28.02.2019.
"Anita Rani Vs. Ashok Kumar", Civil Appeal Nos. 7750-7751 of 2021 decided by the Hon'ble Apex court on 16.12.2021, was also a recovery case in which the defence was of full and final settlement and consequent payment. The other defence was that the plaintiff had given them money gratuitously. In that background, following was held by Hon'ble Apex court :-
"16. ... When payment of a certain amount of money and the repayment of only a portion of the same are admitted, the party pleading that such a part repayment was in full and final settlement, has a huge burden cast upon him to show that there was a settlement. Oral evidence of the so called third party mediators, is not sufficient to establish full and final settlement, in cases of this nature, where all transactions have happened only through banking channels and the defendants claimed that there were business transactions. ...
18. ... A party who admits receipt of certain amount of money on a particular date and pleads discharge by way of a full and final settlement at a latter date, is the one on whom the onus lies. ...
22. In a suit for recovery of money, a defendant admitting the receipt of money but pleading that the same was a gratuitous payment, is obliged to prove that it was a gratuitous payment. ..."
CS (COMM) No.: 389/23 Digitally
signed by
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 11/17 UMED
UMED SINGH
SINGH Date:
2025.08.02
16:40:39
+0530
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In view of above facts, circumstances and law, it is held that the defendant has failed to prove full payment of the amount due till 28.02.2019.
11. The plaintiff has placed on record the ITR and balance sheet in support of the ledger account and bills.
For financial year 2017-18, the plaintiff had filed ITR Ex. PW1/10 accompanied by the balance sheet which was further accompanied by the list of debtors in which it is mentioned that the defendant was debtor of plaintiff to the tune of Rs. 16,17,404/- on 31.03.2018. The same figure of outstanding amount is mentioned in ledger account Ex. PW1/4.
The ITR for the financial year 2019-20 is accompanied by balance-sheet which is further accompanied by a list of sundry debtors in which it is mentioned that defendant was debtor of the plaintiff to the tune of Rs. 16,53,964/- as on 31.03.2020. The same outstanding amount is mentioned in ledger account Ex. PW1/4A.
The plaintiff had filed ITR for the financial year 2020- 21 accompanied by balance-sheet which is further accompanied by list of debtors in which it is mentioned that defendant was plaintiff's debtor to the tune of Rs. 14,53,964/-. The same very amount is mentioned against the name of defendant in ledger account Ex. PW1/4B.
CS (COMM) No.: 389/23
Digitally
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 12/17 signed by
UMED
UMED SINGH
SINGH Date:
2025.08.02
16:40:46
+0530
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Similarly the plaintiff had filed ITR for the financial year 2021-22 accompanied by balance-sheet which is further accompanied by list of sundry debtors in which it is mentioned that the defendant was debtor of the plaintiff to the tune of Rs. 12,78,964/-. The same amount is mentioned in the ledger account Ex. PW1/4B from 01.04.2021 to 28.02.2022.
So, the ledger account of the plaintiff is corroborated by its ITRs, balance-sheets and list of debtors. After 28.02.2022, the defendant made payment of Rs. 25,000/- on three occasions on 18.04.2022, 29.05.2022 and 05.12.2022 and thereafter the outstanding amount was Rs. 12,03,964/-.
But on the other hand, the defendant, despite being a company, did not place on record its balance-sheet to justify complete payment.
12. The defendant did not file its bank statement to corroborate ledger account. It is not corroborated by bald testimony of any witness other than DW1. The defendant did not place on record its ITR and balance-sheet. It has also failed to prove the complete payment onus of which was solely upon it. Due to these reasons, precedence is given to the ledger account of the plaintiff over the ledger account of the defendant.
CS (COMM) No.: 389/23
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 13/17
Digitally
signed by
UMED UMED SINGH
Date:
SINGH 2025.08.02
16:40:52
+0530
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13. In view of above discussion, it is held that plaintiff has successfully proved that the defendant had purchased fuel from it for which the outstanding amount is Rs. 12,03,964/-.
14. Now let us take up the issue of registration of the firm.
Ex. PW1/9 Form B shows that a firm by the name of M/s Jagdish Filling Station was registered with Registrar of Firms, District North West, GNCT Delhi, on 01.02.2013 at serial no. 807. The Form A shows that there were three partners namely Sh. Gurdyal Singh Ahluwalia, Sh. Kanwarjit Singh Ahluwalia and Sh. Arvinderjit Singh Ahluwalia. It is the admitted case that latter two partners are sons of partner no. 1 Sh. Gurdyal Singh Ahluwalia who, as per the cross-examination of PW1, expired in 2014. As per Section 42 of Indian Partnership Act, 1932, subject to contract between partners, the firm is dissolved by the death of a partner. In the case in hand, the plaintiff did not place on record the firm deed or any other document to show that it was agreed between the partners that death of any one of them shall not dissolve the partnership firm and the remaining partners shall continue to do business. Due to non placing on record such documents, it can be said that the firm M/s Jagdish Filling Station which was registered with registrar of firm on 01.02.2014, had dissolved after the death of Mr. Gurdyan Singh Ahluwalia.
CS (COMM) No.: 389/23 Digitally
Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 14/17 signed by
UMED
UMED SINGH
SINGH Date:
2025.08.02
16:40:59
+0530
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On similar issue following was held by the Hon'ble Apex court in "Indian Oil Corporation Limited & Ors. Vs. M/s Shree Niwas Ramgopal & Ors. " 2025 INSC 832 :-
"19. The deed of partnership on the other hand vide Clause 18 clearly stipulates that the death of any partner shall not cause discontinuance of the partnership business and that the surviving partners may continue the business and the interest of the deceased partner shall vest in the legal heirs of the deceased. The surviving partners have the option to admit any of the competent heirs of the deceased partner to the partnership on such terms and conditions as may be agreed upon.
20. The aforesaid clause thus permits the existing partners to continue with the partnership business notwithstanding the death of one of the partners, leaving it open for the surviving partners to induct any of the competent heirs of the deceased partner in the partnership business. It is not necessary for the surviving partners to include all the heirs of the deceased partners in the partnership or to wait for their consent to be included or not to be included in the partnership.
21. It is settled in law by virtue of Section 42 of the Partnership Act, 1932 4 that the partnership will stand dissolved inter alia on the death of the partner but this is applicable in cases where there are only two partners constituting the partnership firm. The aforesaid principle would not apply where there are more than two partners in CS (COMM) No.: 389/23 Digitally Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 15/17 signed by UMED UMED SINGH SINGH Date:
2025.08.02 16:41:06 +0530 ~ 16 ~ a partnership firm and the deed of partnership provides otherwise that the firm will not stand automatically dissolved on the death of one of the partners.
22. In the case at hand, the partnership consisted of three partners and the deed of partnership, in unequivocal terms, provided that the death of a partner shall not cause discontinuance of partnership and the surviving partners may continue with the business. Therefore, the principle laid down under Section 42 of the Partnership Act would not be applicable and the partnership would continue despite the death of one of the partners."
15. Other document relied upon by the plaintiff is partnership deed Ex. PW1/1 showing that Sh. Kanwarjit Singh Ahluwalia and Sh. Arvinderjit Singh Ahluwalia, who were partners in erstwhile firm, agreed to do business with a new partner Mr. Sudhkar Bansiwala and the deed was registered in the office of sub-registrar on 01.02.2022. But the plaintiff did not file any document to show that the said firm was registered with registrar of firms.
As per section 69(2) of the Indian Partnership Act 1932, no suit to enforce a right shall be instituted on behalf of a firm against third party, unless firm was registered and the persons suing or have been shown in the register of firms as the partners. Perusal of section 58 shows that application for registration is to be moved before the Registrar of the area in CS (COMM) No.: 389/23 Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 16/17 Digitally signed by UMED UMED SINGH SINGH Date:
2025.08.02 16:41:12 +0530 ~ 17 ~ which any place of business of the firm is situated. In the case in hand, the plaintiff did not file certificate showing that it is a registered firm and that PW 1 was one of the partner. In view of that default, the suit is dismissed.
16. Though the plaintiff has successfully proved that the defendant did not make payment of outstanding amount of Rs. 12,03,964/- but it is not entitled to that amount because the case is not maintainable as it has been filed by an unregistered firm which is barred under Section 69 (2) Partnership Act. This issue is decided in favour of defendant and against plaintiff.
Issue No. 217. As plaintiff is not entitled to principal amount, it is not entitled to any interest also.
Issue no. 3
18. Consequent to decision on issue nos. 1 and 2, suit is dismissed.
Decree sheet be prepared accordingly. File be consigned to record room. Digitally signed by UMED UMED SINGH Announced in open court SINGH Date:
2025.08.02 16:41:21 on 02nd August, 2025 +0530 (UMED SINGH GREWAL) District Judge-Commercial Court-02 North District, Rohini Court, Delhi.
CS (COMM) No.: 389/23 Col. K S Ahluwalia Vs. M/s Rana Travels Pvt Ltd Page No. 17/17