Research › Search › Judgment

Andhra High Court · body

2014 DIGILAW 1371 (AP)

Jyothi Trading Company v. Potnuru Rameswara Rao

2014-11-12

M.SEETHARAMA MURTI

body2014
ORDER M. Seetharama Murti, J. 1. This Civil Revision Petition under Article 227 of the Constitution of India is directed against the orders dated 04.06.2012 of the learned I Additional District Judge, Srikakulam made in I.A. No. 17 of 2011 in A.S. No. 26 of 2006. The relevant introductory facts, in brief, are as follows: "The plaintiff, i.e., Jyothi Trading Company represented by its' Managing Partners (i) Tangudu China Samba Murthy and (ii) Potnuru Venkata Lakshminarayana brought a suit against Muddada Simhachalam and four others for declaration of title and perpetual injunction in respect of the plaint schedule lands and for costs. The suit was resisted by some of the defendants. The 1st defendant died during the pendency of the suit. The suit was prosecuted against the defendants 2 to 5. Even during the pendency of the suit, Tangudu China Samba Murthy, who is said to be one of the managing partners of the plaintiff firm, had also died. His legal heirs were brought oh record as co-plaintiffs. On merits, the learned Junior Civil Judge, Narasannapet had decreed the suit, by judgment dated 28.03.2005 and granted a decree for perpetual injunction insofar as part of item No. 1, but had dismissed the suit insofar as part of item No. 1 and item No. 2 of the plaint schedule properties. The aggrieved plaintiffs had preferred an appeal, A.S. No. 26 of 2006 on the file of the learned Judge, Family Court-cum-II Additional District Judge, Srikakulam. During the pendency of the first appeal, the said Venkata Lakshminarayana, who is said to be the other managing partner representing the plaintiff firm had also died. In the said circumstances, the respondents 1 and 2 herein claiming themselves to be the legal heirs of the said Venkata Lakshminarayana had filed I.A. No. 17 of 2011 in A.S. No. 26 of 2006 requesting for their impleadment as parties to the appeal being the legal heirs of the said Venkata Lakshmi Narayana, who was said to be the managing partner of the plaintiff firm. The said application was resisted by one of the plaintiffs, Vysyaraju Janardhan by filing a counter. The said counter was adopted by the co-plaintiffs, Tangudu Viswanadham and Naramsetty Narasimha Murty. The said application was resisted by one of the plaintiffs, Vysyaraju Janardhan by filing a counter. The said counter was adopted by the co-plaintiffs, Tangudu Viswanadham and Naramsetty Narasimha Murty. To put it simply, the plaintiffs who are brought on record on the death of Tangudu China Samba Murthy, one of the managing partners of the plaintiff firm, had resisted the application of the legal heirs of Potnuru Venkata Lakshminarayana, who is said to be the another managing partner of the plaintiff firm even as per the plaint averments. The 10th respondent, i.e., 5th defendant in the suit had also filed a counter resisting the application. On merits, the Court of first appeal had allowed the petition and had directed for the impleadment of the proposed parties as the 6th and 7th appellants in the first appeal suit they being the legal heirs of Potnuru Venkata Lakshminarayana, who is said to be one of the managing partners of the plaintiff firm, now the 1st appellant. The aggrieved plaintiff firm and the other plaintiffs filed this revision petition opposing for the impleadment of the proposed parties as co-appellants in the first appeal though they are claiming to be the legal representatives of the deceased Potnuru Venkata Lakshminarayana, who was described originally in the plaint as the managing partner of the plaintiff firm/1st appellant." 2. I have heard the submissions of the learned counsel for both the sides. I have perused the material record. 3. Now, the point for determination is: Whether the proposed parties have not made out valid and sufficient grounds for their impleadment as co-appellants in the first appeal in view of their claim that they are the legal representatives of the deceased Potnuru Venkata Lakshminarayana, who was said to be the managing partner of the plaintiff firm along with the deceased Tangudu China Samba Murthy? And if so, whether the impugned order is liable to be set aside? 4. POINT: 4. (a) The case of the proposed parties, in brief, is as follows: "Potnuru Venkata Lakshminarayana and Tangudu China Samba Murthy had jointly purchased the suit schedule property and were in joint possession and enjoyment of the same. Pattadar passbook and title deed book were also issued. 4. POINT: 4. (a) The case of the proposed parties, in brief, is as follows: "Potnuru Venkata Lakshminarayana and Tangudu China Samba Murthy had jointly purchased the suit schedule property and were in joint possession and enjoyment of the same. Pattadar passbook and title deed book were also issued. Both of them had filed the suit as the managing partners of the plaintiff firm--M/s. Jyoti Trading Company for declaration of title and consequential perpetual injunction and the suit was partly decreed. Since the first managing partner-Tangudu China Samba Murthy had died during the pendency of the suit, his legal representatives were brought on record as the plaintiffs. The said Potnuru Venkata Lakshminarayana, the other managing partner of the plaintiff firm and the above said legal heirs of the other managing partner-Tangudu China Samba Murthy had filed the first appeal. During the pendency of the first appeal, Potnuru Venkata Lakshminarayana, the father of the proposed parties had died on 07.11.2010. He had executed a Will dated 10.05.2009 bequeathing his properties including the suit schedule properties equally in favour of both the proposed parties. Therefore, both the proposed parties are interested in the subject matter. While so, the proposed parties came to know that the appellants 3 to 5 had filed a memo seeking permission to withdraw the appeal falsely contending that the suit is not filed in their individual capacity by their father and that since the 1st plaintiff is the firm and that father of the plaintiffs 3 to 5 is one of the partners of the firm. In the memo, it is also stated that since Potnuru Venkata Lakshminarayana died and as he is not a partner of the firm, bringing the legal representatives of the said Potnuru Venkata Lakshminarayana on record does not arise and that the appeal of the 2nd appellant is abated and that they have entered into a compromise with the contesting respondents in the appeal. In the memo, the leave of the Court was sought for withdrawal of the appeal. In the circumstances, the petitioners are proper and necessary parties to the appeal being the successors/legal heirs of the deceased Potnuru Venkata Lakshminarayana, who represented the plaintiff firm as the managing partner." 4. (b) The case of the legal heirs of the other managing partner-Tangudu China Samba Murthy, in brief, is as follows: "The petition for impleadment by the proposed parties is not maintainable. (b) The case of the legal heirs of the other managing partner-Tangudu China Samba Murthy, in brief, is as follows: "The petition for impleadment by the proposed parties is not maintainable. The contentions raised by them are unconcerned to the subject matter of the appeal. Their affidavit shows a fresh cause of action for a suit, but not for their impleadment as appellants and continuation of the appeal. The averments in support of the request for their impleadment are in the nature of additional evidence in the appeal suit. Since the suit is filed by the firm, the question of addition of legal representatives does not arise. Order 1 Rule 10 of the Code has no application; question of filing a petition under Order XXII of the Code does not arise. The petition is not maintainable. Further, the averments in the counter of the 5th defendant in the suit (10th respondent in the appeal suit), in brief, are as follows: "The proposed parties are put to strict proof that their father had gifted the subject properties under a Will to them. There are no valid grounds for impleading the proposed parties as appellants in the appeal suit. The respondents 8 and 9, i.e., the defendants 3 and 4 had executed an agreement of sale dated 30.11.1996 in favour of the 5,h defendant/10th respondent in respect of the vacant site to an extent of 444 Vz square yards and a suit O.S. No. 290 of 2010 is already filed on the file of the Court of the learned Additional Senior Civil Judge's Court, Srikakulam against the defendants for specific performance. The petition is not maintainable". 4. (c) As already noted, the Court of first appeal had allowed the petition of the proposed parties and had permitted them to come on record as the appellants in the appeal filed by the plaintiff firm and others. 4. (d) I have carefully perused the grounds of revision, the impugned order, the pleadings filed before the trial Court by both the parties in the interlocutory application and also the provisions of law, viz., Order 1 Rule 10, Order XXII and Order XXX of the Code of Civil Procedure and also the relevant provisions of the Indian Partnership Act, particularly, Section 69. A careful examination of the material record would show that the plaintiff is styled as 'Jyothi Trading Company' represented by its managing partners, namely, (i) Tangudu China Samba Murthy and (ii) Potnuru Venkata Lakshminarayana. Therefore, it should be construed that a sole plaintiff, namely, a firm represented by its two managing partners had filed the suit O.S. No. 4 of 1997 on the file of the learned Junior Civil Judge, Narasannapet against the defendants, namely, Muddada Simhachalam (since died) and four others for declaration of title and perpetual injunction in respect of the plaint schedule properties and for costs. Though, it is the mandatory requirement of law, it appears that at the time of the institution of the suit the Firm Registration Certificate i.e., 'Form C and the certified copy of 'Form A' of the plaintiff firm issued by the Registrar of Firms showing the names of the partners are not filed. Even the copy of the deed of partnership of the Firm was not filed as could be seen from the copy of the plaint. But, some documents like the copies of sale deeds, the title deed books and pattadar pass books issued in favour of the managing partners of the plaintiff firm, the certified copy of a sketch for Sy. No. 96, the land revenue receipts are only filed. Had the Form 'C' and Form 'A' certificates been filed along with the plaint and had the trial Court insisted for filing the said documents at the time of the registration of the suit, the matter would not have become as complex as it is now. Though the plaintiff firm is described in the plaint as being represented by two managing partners, i.e., Tangudu China Samba Murthy and (ii) Potnuru Venkata Lakshminarayana, now, it is fairly conceded before this Court that Potnuru Venkata Lakshminarayana is not a managing partner of the plaintiff firm and that only the deceased Tangudu China Samba Murthy was a managing partner. Therefore, a fundamental mistake was committed even at the inception when the suit was filed and during the course of trial, the two managing partners, who are representing the plaintiff firm, were erroneously treated as plaintiffs 1 and 2 though the suit was instituted by the plaintiff firm represented by two managing partners. Therefore, a fundamental mistake was committed even at the inception when the suit was filed and during the course of trial, the two managing partners, who are representing the plaintiff firm, were erroneously treated as plaintiffs 1 and 2 though the suit was instituted by the plaintiff firm represented by two managing partners. Since the said Potnuru Venkata Lakshminarayana was admittedly not a managing partner of the plaintiff firm, his name should not have been shown as a managing partner. And, if his presence as a plaintiff to the suit was/is necessary he should have been separately shown in the array of plaintiffs as a co-plaintiff. But that was not so. Another aspect is that on the death of Tangudu China Samba Murthy, the managing partner of the plaintiff firm his legal heirs were brought on record by showing them as plaintiffs 3 to 5 and the suit was prosecuted against the defendants 2 to 5. This is another grave error which was committed and allowed to be committed, In a suit filed by a partnership firm represented by a Managing Partner, if the Managing Partner dies, the matter requires examination with reference to the terms of the partnership deed to find out whether the firm continues on the death of the managing partner; and after such examination only, necessary steps shall be permitted to be taken for continuation of the suit by bringing on record the remaining partners, if they are not already made parties to the suit. However, the legal representatives of the deceased managing partner in their capacity as legal representatives need not be brought on record in a suit filed by the Firm. Be that as it may. 4. (e) After the suit was partly decreed, a first appeal was filed by the aggrieved plaintiff firm represented by Potnuru Venkata Lakshminarayana, who was described as the managing partner and the other plaintiffs 3 to 5. During the pendency of the first appeal, the said Venkata Lakshminarayana, who was shown as the managing partner of the plaintiff firm had also died. During the pendency of the first appeal, the said Venkata Lakshminarayana, who was shown as the managing partner of the plaintiff firm had also died. While so, the legal heirs of late Tangudu China Samba Murthy, who were brought on record as the plaintiffs 3 to 5 in the suit and who had preferred the appeal wanted to withdraw the appeal as the managing partner Tangudu China Samba Murthy had died and as Potnuru Venkata Lakshminarayana, who was not the partner of the firm had also died during the pendency of the first appeal. Having come to know of the said facts, the proposed parties who are the sons of Potnuru Venkata Lakshminarayana by filing the petition for their impleadment sought their impleadment as appellants 6 and 7 to the first appeal suit. Now, the proposed parties are also claiming that they are entitled to the suit subject properties not only as the sons of the deceased, Potnuru Venkata Lakshminarayana but also in their capacities as beneficiaries by virtue of a Will executed by their father Potnuru Venkata Lakshminaryana. Thus they would further contend that they have direct interest in the suit schedule properties. 4. (f) The revision petitioners are resisting their request of the proposed parties for their impleadment and are assailing the impugned order which permitted the impleadment of the proposed parties, mainly on the following grounds:--(i) Potnuru Venkata Lakshminarayana, the father of the proposed parties is not a partner/managing partner of the plaintiff firm; (ii) Tangudu China Samba Murthy, who was the Managing Partner/Partner of the plaintiff firm had died during the pendency of the suit. His legal heirs who were brought on record as plaintiffs 3 to 5 had prosecuted the suit and the suit was partly decreed. Now, the plaintiffs 3 to 5 representing the plaintiff firm are only on record. They are entitled to withdraw the first appeal as they have entered into a compromise with the other respondents and as the managing partner of the plaintiff firm Tangudu China Samba Murthy died and the other person by name, Potnuru Venkata Lakshminarayana, who is not a partner of the firm had also died, (iii) Further, in a suit by. a partnership firm, the legal representatives of the deceased partner cannot be brought on record. a partnership firm, the legal representatives of the deceased partner cannot be brought on record. Additionally, the proposed parties, who are the children of Potnuru Venkata Lakshminarayana, who is not a partner of the plaintiff firm, have no right to come on record and prosecute the appeal. 4. (g) The contents of the material record, particularly the plaint averments would show that both the Tangudu China Samba Murthy and Potnuru Venkata Lakshminarayana who were shown in the plaint as managing partners representing the plaintiff firm had jointly purchased the plaint schedule lands under two registered sale deeds and since then, they are cultivating the lands jointly by paying land revenue etcetera to the Government and that they are having absolute right, title and possession over the plaint schedule lands at Gottipalli village near Narasaraopet Town. The defendants are stated to be having lands immediately abutting the plaint schedule lands. Thus, though it is now fairly conceded that Potnuru Venkata Lakshminarayana, the father of the proposed parties, is not a managing partner of the plaintiff firm, it is borne out by record that he was having a joint right in the plaint schedule property even as per the plaint averments. The proposed parties being the sons of the said Potnuru Venkata Lakshminarayana and in view of their claim to the plaint schedule properties, have a direct interest in the plaint schedule property to the extent of the rights of their deceased father. Therefore, in that view of the matter, their request for impleadment as co-plaintiffs cannot be denied, more particularly, when the legal representatives of the deceased managing partner were rightly or wrongly brought on record as plaintiffs 3 to 5. As already noted, though the plaintiff firm represented by two managing partners was shown as the plaintiff in the plaint, the 1st managing partner was treated as 1st plaintiff and the 2nd person described also as managing partner was treated as the 2nd plaintiff and that during the pendency of the suit when the said 1st managing partner had died, his legal representatives were brought on record as plaintiffs 3 to 5. No doubt, in a suit by the Firm, represented by managing partner/partners, when one partner dies, there is no need to bring on record the legal representatives of the deceased partner unless they are necessary parties in their capacities as partners of the firm. No doubt, in a suit by the Firm, represented by managing partner/partners, when one partner dies, there is no need to bring on record the legal representatives of the deceased partner unless they are necessary parties in their capacities as partners of the firm. In case of death of a managing partner or a partner of a plaintiff firm, representing the said firm, the other partners shall only be brought on record but not the legal representatives of the deceased managing partner/partner, who are not partners. However, in the instant suit the plaint itself is defective as in the plaint Potnuru Venkata Lakshminarayana was shown as a managing partner, though, in fact, he is not the managing partner and he has nothing to do with the plaintiff firm. The relevant provisions of Section 69 of the Indian Partnership Act, 1932 reads as under: "69. Effect of non-registration.-- (1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any court by or on behalf of any person suing as a partner in a firm against the "firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm. (2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is. registered and the persons suing are or have been shown in the Register of Firms as partners in the firm." Though, it is the mandatory requirement of law that the Firm Registration Certificate, i.e., 'Form C issued by the Registrar of Firms and the certified copy of 'Form A' of the plaintiff firm issued by the Registrar of Firms showing the names of the partners are to be filed at the time of the institution of the suit, it appears that the said documents are not filed. The copy of the deed of partnership of the plaintiff firm was also not filed as could be seen from the copy of the plaint. The copy of the deed of partnership of the plaintiff firm was also not filed as could be seen from the copy of the plaint. Potnuru Venkata Lakshminarayana is also shown as a plaintiff in the plaint, obviously for the reason that the property was jointly acquired under registered sale deeds and he has got joint right in the plaint schedule property. Therefore, the legal representatives of the deceased Tangudu China Samba Murty, who are already on record as plaintiffs 3 to 5 cannot now contend contrary to the plaint averments. The law is well settled that the legal representatives cannot be permitted to take the stand contrary to the stand taken by their predecessors-in-interest for the reason that the legal representatives step into the shoes of the deceased party. Order XXX of the Code of Civil Procedure deals with suits by or against firms and persons carrying on business in names other than their own. Rule 2 of the said Order XXX ordains that where a suit is instituted by partners in the name of their firm, the plaintiffs or their pleader, shall, on demand, in writing by or on behalf of any defendant, forthwith declare in writing the names and places of residence of all the persons constituting the firm on whose behalf the suit is instituted. Under Rule 1 any two or more persons claiming as partners may sue and any party to such a suit may apply to the court for a statement of the names and addresses of the persons, who were, at the time of accruing of the cause of action, partners in such firm, to be furnished and verified in such manner as the court may direct. The Rule 4 of the said Order reads as under: Rule 4: Right of suit on death of partner:-- (1) Notwithstanding anything contained in Section 45 of the Indian Contract Act, 1872 (9 of 1872), where two or more persons may sue or be sued in the name of a firm under the foregoing provisions and any of such persons dies, whether before the institution or during the pendency of any suit, it shall not be necessary to join the legal representatives of the deceased as a party to the suit. (2) Nothing in sub-rule (1) shall limit or otherwise effect any right which the legal representative of the deceased may have--(a) to apply to be made a party to the suit, or (b) to enforce any claim against the survivor or survivors." 4. (h) There is no dispute with the legal proposition laid down in the decisions in Adduri Dasaratha Rami Reddy v. Indian Bank 1999 (6) ALD 668 and Anokhe Lal v. Radhamohan Bansal AIR 1997 SC 257 to the effect that the legal representatives of the deceased partner of a firm need not be brought on record, if they are otherwise, not entitled to apply to be made as parties to the suit or to enforce any claim against the survivors. However, when Tangudu China Samba Murthy, who is said to be the managing partner of the plaintiff died, the plaintiffs 3 to 5, who are his legal representatives and who are not shown to be partners by filing any material document ought not to have been brought on record as plaintiffs 3 to 5. Therefore, the addition of the plaintiffs 3 to 5, who are the legal representatives of the deceased managing partner is itself improper and irregular. However, the trial Court had allowed them to come on record. Now, they are opposing the request of the proposed parties to come on record in their capacities as legal representatives of Potnuru Venkata Lakshminarayana, being his sons. In their absence on record, the plaintiffs 3 to 5 now want to settle the matter with the defendants and intend to withdraw the suit in view of the said settlement ignoring the plaintiff firm and the rights of the remaining partners, if any, of the said firm. If the property is not the property of the firm, the fact remains that the property, as per plaint averments was jointly purchased under registered sale deeds by late Tangudu China Samba Murty and late Potnuru Venkata Lakshminarayana. The legal representatives of Tangudu China Samba Murthy are already on record as plaintiffs 3 to 5. The proposed parties, admittedly, are the sons of Potnuru Venkata Lakhsminarayana, who was arrayed as a plaintiff in the suit. The legal representatives of Tangudu China Samba Murthy are already on record as plaintiffs 3 to 5. The proposed parties, admittedly, are the sons of Potnuru Venkata Lakhsminarayana, who was arrayed as a plaintiff in the suit. Therefore, in view of the indisputable fact that the said Potnuru Venkata Lakhsminarayana is having a joint title, right and interest in the suit schedule property as per the plaint averments and as the proposed parties have got direct interest in the suit property being the sons of the said Potnuru Venkata Lakhsminarayana, they are entitled to come on record if not, as partners of the plaintiff firm but as legal representatives of Potnuru Venkata Lakhsminarayana, who is one of the plaintiffs and also as necessary and proper parties having direct interest in the suit property having succeeded to the joint right of their father if not under the Will but under the law of succession. Further, in view of the defects right from the institution of the suit and the continuation of the suit with all the inherent defects, any further proceedings in the suit, shall not be allowed to take place in the absence of the proposed parties, who have got a direct interest in the subject matter. To have proper adjudication of all the issues in respect of the property in question and to avoid multiplicity of litigation and to protect the rights and the interests of the proposed parties, in respect of the suit schedule properties, it is just and fair to permit the proposed parties to come on record as plaintiffs they being admittedly the sons of Potnuru Venkata Lakhsminarayana. Their impleadment, in view of the peculiar facts and the complexity of the matter is necessary to effectively adjudicate upon and settle all the questions involved in the suit. 4. (i) In this revision, there is no need to advert to any other aspects like partner's right when he is not shown in the register of firms maintained by the Registrar of Firms as the said aspects are not germane for consideration in this revision petition and as at this stage, this court will not and shall not go into the merits of the issues but only has to consider the right of the proposed parties to come on record and whether they are necessary and proper parties or not to the suit. Therefore, the decisions relied upon by the learned counsel for the revision petitioners in S. Prakashchand v. Sha Harakchand Misrimull rep. by its Partner M. Oatmul Jain AIR 2002 Mad. 372 , Sharad Vasant Kotak and others v. Ramniklal Mohanlal Chawda (1998) 2 SCC 171 and Chairman Lal and another v. Firm New India Traders Mica Merchants and others AIR 1962 Patna 25 are not helpful to the revision petitioners. 4. (j) Viewed thus, this Court finds that the contentions of the revision petitioners do not merit consideration and that the revision is devoid of merit. In the result, the Civil Revision Petition is dismissed. There shall be no order as to costs. Miscellaneous petitions, if any, pending in this revision shall stand closed. Petition dismissed