Madras High Court
T. Savariraj Pillai vs M/S. R.S.S. Vastrad And Company on 3 November, 1989
Equivalent citations: AIR1990MAD198, AIR 1990 MADRAS 198
ORDER
1. Defendant in O. S. No. 1293 of 1984 on the file of II Additional Subordinate Judge, Tiruchirapalli is the petitioner. Plaintiff is the sole respondent. Plaintiff filed the suit based on equitable mortgage and for other reliefs, and at the stage when defendant was examined as D.W. 1, he filed I.A. No. 466 of 1987 under O. 23, R. 1(3) and S. 151, Civil P.C. seeking permission to withdraw the suit with liberty to file a fresh suit in respect of the subject-matter of the present suit. The suit was filed by M/s. R.S.S. Vashtrad an Company through one of its partners M. M. Nalavad. He had sworn to before Court that he had filed Exhibit A-2 partnership deed to show that he is a partner of the plaintiff firm even prior to 10-10-1983, but, however, this fact was not intimated to the Registrar of Firms by the Auditor of the Firm, and that entry had been made in the Register only diring the pendency of the suit, and therefore, it being a formal defect, which would not go into the root of the matter, he had been advised to file a fresh suit, and therefore, he sought for permission to withdraw the suit with liberty to file a fresh suit.
2. This was opposed by defendant claiming that it is only after cross-examination of the plaintiff, application had been made to include the name of Mr. Nalavad as a partner on 22-5-1987 and accordingly registered by the Registrar of Firm, and that on the date of suit, he was not a partner, and therefore, had no right to file the suit, and hence it is non est in the eye of law.
3. The Court below held that the suit as filed is not void, and that it would be proper to grant the relief as prayed for and directed payment of Rs. 200/-. It is against the said order, this revision petition is filed.
4. The sole point which arises for consideration is, whether the non-compliance of the requirements of S. 69(2) of Partnership Act is a formal defect or its requirement is mandatory, and in its absence, a suit filed in this manner is a void suit.
5. Learned Counsel Mr. E. Padmana-bhan, would straightway rely upon the decision in Loonkaran Sethia v. Ivan E. John, in which dealing with the scope of S. 69 of the Act, it was held that it is mandatory in character and that a partner of an erstwhile unregistered partnership firm cannot bring a suit to enforce a right arising out of a contract within the ambit of S. 69.
6. In the matter of Abani Kanta Pal, , a Division Bench in dealing with the scope of the section held that if a Firm is not registered, excepting in a suit as contemplated under S. 69(3) of the Act, the Court will have no jurisdiction to entertain a suit in violation of S. 69(1). It further added :
"..... In other words, the plaint that has been filed by the plaintiff will be considered a void plaint, if it contravenes the provisions of sub-sees. (1) and (2) of S. 69 of the Partnership Act....."
A Division Bench of the same Court in an earlier decisions in Ram Kumar Shew Chan-drai, a Firm v. Dominion of India, held that if the name of one person who was partner on date of suit is not shown in the Register then the suit as filed is not maintainable. A Division Bench in Bank of Koothattukulam v. Thomas, AIR 1955 Trav Co 155 held :
"It is necessary not only that the firm should be registered, but the person suing must be shown as a partner in the firm. And when it is found that on the date when the plaint is filed the second part of this condition has not been carried out when S. 69(2) is not complied with..... The registration after the institution of the suit cannot cure the defect of non-registration before the date of suit".
7. A Division Bench of this Court in Buhari Trading Co. v. Star Metal Co., in dealing with the dismissal of a suit which was sought to be withdrawn on the ground that the plaintiff therein was an unregistered firm, held that it would not be a bar to file a fresh suit on the same cause of action after the firm gets registered, and for doing that no permision is needed. This decision also proceeds on the basis that the suit earlier filed is non-est in the eye of law.
8. To counter the contentions of learned Counsel Mr. E. Padmanabhan based on these decisions; learned counsel Mr. T. R. Raja-gopalan, would submit that it is only a formal defect in view of the provisions found in O. 23, R. 1 (3)(b), Civil P. C. and relied on Sri Saravana Chit Fund Co. v. Sekudeen (1981) 94 Mad LW 228 : (1981) 1 Mad LJ 437 which deals with failure to issue the statutory notice under S. 25 of the Chit Funds Act, and on the suit being dismissed for want of notice, it was treated as a techinical defect, and to prevent parties from suffering permission was granted to withdraw the suit under O. 23, R. 1(3), C.P.C. with liberty to file a fresh suit, so that there may not be miscarriage of justice. This decision of the learned Judge, could not apply in relation to a suit covered by S. 69(2) of the Act, which had been held by the Supreme Court as mandatory; The concept of formal defect which could be available under O. 23, R. 1(3), C.P.C. would have no relevance when a mandatory requirement is not complied with, for the institution of a suit. As learned Judge in Atul v. Rajkishore, AIR 1956 Orissa 77 also took the same view in respect of O.23, R. 1(b), C.P.C. to the effect that a formal defect is a defect of form which is prescribed by rules of procedure such as misjoinder of parties, causes of action, non-payment of court-fees, etc., and in a case where plaintiff fails to incorporate a prayer for dissolution of partnership in a suit for accounts, it would no doubt result in dismissal of suit, but it being a formal defect, plaintiff could be permitted to come again with a properly drafted plaint. This is again a decision, which does not deal with non-compliance of a mandatory requirement.
9. Kamayya v. Papayya (1917) ILR 40 Mad 259 : (AIR 1918 Mad 1287) in a Full Bench decision which dealt with the powers of an appellate Court to allow a suit to be withdrawn with liberty to file a fresh suit, and hence, it has no application to the point involved in this revision. Therefore, those decisions do not in any manner enable the plaintiff to secure the withdrawal of the suit with permission to file a fresh suit.
10. Yet, learned Counsel Mr. T. R. Raja-gopalan, would submit that, when the suit had been filed by the Firm, the fact that the Firm being represented by a partner whose name was not registered with the Registrar of Firms on the date of filing of the suit, would not make it a void suit, and that S. 69(2) would have no application. In the light of the decisions relied on by learned Counsel Mr. E. Padmanabhan, and which had been referred to above; such a distinction would not be available to salvage a suit of this nature, which is hit by the mandatory requirements of S. 69(2) of the Act. In this context, Shreeram Finance Corpn. v. Yasin Khan, requires to be referred to. It was held therein that a suit hit by S.69(2) is not maintainable, becaue it is a mandatory requirement.
11. In the concluding stage, learned Counsel Mr. Rajagopalan, would submit that the plaintiff is not now seeking for withdrawal of suit, and that he would continue to conduct the suit by taking other points, which are available to it in law. Therefore, the Court below is directed to restore the suit on its file and dispose of, based on whatever other legal and factual contentions that may be raised by respective parties.
12. Hence, this revision petition is allowed. No costs.
13. Revision allowed