PURUSHOTTAM UMEDBHAI & CO. versus M/S MANILAL AND SONS (IN CONNECTED APPEALS)

October 7.

982

Sl1PREME COURT REPORTS

[ 1961]

Pt;RUSHOTTA!\I UMEDBHAI & CO. v. M/S . .MANILAL AND SONS (IX co:-.NECTED APPEALS) (8. ,J. htAM, A. K. SARKAR am! B.AOOHBAR DAYAL, JJ.)

Pleadings- -Suit by foreign firm in firm namc--l'laint, if a '"'llity- -Application for amendment of plaint for substitution of names of partners instead of the 11ame of the firm-Maintainability ---Code of Civil Pro"dure, 1908 (Act V of 1908), s. lSJ-0. XX X rr.1. 2-0.1, rr. 10(1), l0(2).

Partmrsl11p --- Power of Attorney-Partner if ca11 e.reculc power on bd1alf of all parltlers-l11dia11 Partnership Act, 19p (l X of 1932) SS. 4, 18 illld 19(2).

,

The respondent a firm carrying on business in Singapore filed a plaint in the firm name against the appellants for th& breach of contract. The plaint had been signed and verified on behalf of the firm by one' D ·on a power of attorney cxer.u tod hy one of the ;>artncrs only. After about 6 years the res pondents made an application fur the amendment of the plaint. The amendment sought was to the effect that the name of the firm as plaintiff il<' struck off, as it was a misdescription and in its place and stead the names of five partners of the firm should he brought on record in order to bring the controversy between the proper parties into clear relief.

The amendment petition was rejected, inter ,.Jia, on the grounds that the original plaint was no plaint in law and it was not a case of misnomer or misdescription, nor a case of a non existent firm or a non-existent person, b·.1t a legal bar, as the plaint was a nullity. The proper course when there is. such a mistake is not to amend disregarding the condition of 0. r r. IO of the Code of Civil Procedure but to seek the Court's permis sion 10 withdraw tl1c suit with liberty to file a fresh suit under o. 23 r. I of the Civil Procedure Code on th• ground of formal defect and which should be done before limitation.

Jn appe.al the High Court came to the conclusion that the description of a plaintiff by a firm name in a case where the Code of Civil Procedure docs not permit a suit to be brought in the firm name s!wuld properly be considered a case of descrip- tion of the individual partners of the husiness and as su~h a n1isdescription, which in la\v can be corrected and should not b,~ considcrt~d to arnount to a description of non-existent per- :i.Oll.

It also rejected the contention that the power of attorney

in favour of 'I)' was insufficient.

,(

Purushottam Umedbhai 6· Co. v. J1 / s. .ill (tnilal &· Sons

I S.C.R. SUPREME COURT REPORTS

983

Held, that the word" firm" or the" firm name" in s. 4 of the Indian Partnership Act is merely a compendious description of all the partners collectively. Where a suit is filed in the name of a firm it is still a suit by all the partners of the firm unle.ss it is proved that all the partners had not authorised the suit.

The provision of 0. XXX r. 1 & 2 of the Code of Civil Pro cedure are enabling provisions to permit several firms who are doing business as partners to sue or be sued in the name of the firm and do not prevent the partners of a firm from suing or being sued in their individual names, nor do they prohibit the partners of a firm suing in India in their names individually although they may he doing business outside India ; since a firm is not a legal entity the privilege of suing in the name· of a firm is permissible only to those persons, who as partners are doing business in India. Such privilege is not extended tu In persons who are doing business as partners outside India. their case they still have to sue in their individual names. If however, under some misapprehension, persons doing business as partners outside India do file a plaint in the name of their firm they are misdescribing themselves, as the suit instituted is by them, they being known collectively as a firm.

'

A plaint filed in a court in India in the name of a firm doing It is a plaint business outside India is not by itself a nullity. by all the partners of the firm with a defective description of themselves for the purpose of the Code of Civil .. Procedure. A civil court could permit under provisions of s. 153 of the Code an amendment of the plaint to enable a proper description of the plaintiffs to appear in it in order to assist the court in deter mining the real question or issue between the parties. Neither r. 10(1) nor r. ro(2) of Order I have any application to a case of this kind, as the suit had been from its very inception a suit by the partners ofthe firm and no question of adding or substitut ing any person'arises, the partners collectively being described as a firm with a particular name.

Held, further, that .it is not necessary that the power of attorney should be signed by all the partners of the firm. A partner is an agent of the firm and there is no prohibition to a partner executing a power of attorney in favour of an indivi dual authorising him to institute a suit on behalf of the firm.

Vyankatesh Oil Mill Co. v. Velamahomed, A.LR. 1928 Born.

191, disapproved.

Amulakchand Mewaram v. Bab1<lal Kanalal. A.LR. 1933 Born. 304, Sadler v. Whiteman, [19ro] I K.B. 868, M1<ra Mohideen v. V. 0. A. Mohomed, A.LR. 1955 Mad. 294 and Kasturchand Bahiravdas v. Sagarmal Shriram, (1892) I.L.R. 17 Born. 413, discussed.

Hajee Sattar Hajee Peer Mohamad v . . Khusiram Benarsilal,

l.L.R. [1952] l Cal. 153, referred to.

PMYwsJioltam U medbh ai C>- Co. v. J\1 /s. Ma,iilal cS- Sons

1 ... ,. J.

984

SUPRE~IE COURT REPORTS

[1961]

CIVIL APPELLATE JURISDICTION: Oivil Appeals

Nos. 178 and 179 of 1960.

Appea.ls by Specia.1 Lea.ve from the Judgment and Decree da.ted the 18th December, 1958, of the Ca.I. cutta High Court in Appeals from Origina.1 Orders Nos. 108 a.nd 138of1957 respectively.

B. R. L. Iyengar for the Appellants (In both the

a.ppea.ls.)

N. 0. Chatterjee a.nd D. N. Mukher.jee for the Res.

pondents (In both the a.ppea.ls).

1960. October 7. The Judgment of the Court was

delivered by

IMAM J.-These a.re a.ppea.ls by specia.l lea.ve a.ga.inst the order of a. Division Bench of the Calcutta. High Court dated December 18, 1958, setting a.side the order of P. B. Mukherjea., J., da.ted February 8, 1957, whereby he rejected the petition of the respondent for amendment of the pla.int, filed in Suit No. 1452 of 1951 in the High Court, in exercise of its Ordinary Original Civil jurisdiction.

The pla.int in Suit I\ o. 1452 of 1951 wa.s filed in the na.me of Ma.nila.l & Sons, a. firm carrying on business at No. llA, Mala.cca. Street, Singapore. The partners of this firm were five in number. They were (I) Ma.nubha.i '.\fa.ga.nbha.i Amin (2) Pravinbha.i Da.hya.. bha.i Pa.tel (3) Ga.ngabhai Iswarbhai Pa.tel (4) Bachu bhai Manibhai Amin and (5) Dahyabha.i Trikambha.i. The defendant wa.s the firm of Purushottam Umed bhai & Co. (now the a.ppellant)-a. firm registered under the Indian Partnership Act, 1932-carrying on business at No. 55 Canning Street, Calcutta.. In July, 1949, there was a contra.ct between the plaintiff a.nd the defendant under which the defendant was to sell to the former, subject to certain conditions, 950 bales of Hea.vy Coos gunny bags c. i. f. Singapore to be It wa.s a.lso shipped from Calcutta in August, 1949. a.greed between the plaintiff and the defendant in July-August, 1949, tha.t the latter would sell, subject to certain conditions, 600 bales of Heavy Cees gunny bags c. i. f. Hong Kong to be. shipped from Calcutt&

•

/

Purusholtam Umedbhai c£.. Co. v. Mfs. Manilal 6- Sons

Iniam J.

J

' .....

'·

1 S.C.R. SUPREME COURT REPORTS

985

in August, 1949. According to the plaintiff, the defendant did not perform the contract entered into by the parties and as a result of the default on the part of the defendant the plaintiff had suffered loss The plaintiff accordingly claimed compensation to the extent of Rs. 2,73,864 and Rs. 7,850 towards expenses incurred, in all Rs. 2,81,714. The breach of the con tract is alleged to have taken place in October and November, 1949. The suit was instituted on April 2, 1951. The defendant's written statement was filed on or about May 21, 1951. The petition for amend ment of the plaint was filed on 'January 31, 1957. The amendment sought was to the effect that the name of the firm Manila.I & Sons as plaintiff be struck off and in its place and stead the names of the five persons who were the partners of the firm may be entered in the plaint as plaintiffs. The petitioner also sought the necessary consequential amendments in the body of the plaint. According to the petition praying for amendment, on January 29, 1957, the solicitors of the plaintiff reeeived a letter from the attorney of the defendant to the effect .that inasmuch as the firm Manila! & Sons wll.s carrying on business at Singapore, an objection would be taken on behalf of the defendant that the suit, as framed, was null and void and not maintainable. The suit had been _pending in the court of P. B. Mukherjea, J., and appeared on the peremptory list, for the first time, on January 3, 1957. According to the petition, the peti tioner was advised that as the misdescription of the plaintiff was a bona fide one, the names of the part ners of the firm Manila! & Sons should be brought on to the record in order to bring the controversy be tween the proper parties into clear relief. Accord ingly, the petitioner filed the petition for amendment. On a Chamber Summons being taken ,out, Mukher jea, J., heard the mattefand rejected the petition for amendment. He was of the opinion that the original plaint was· no plaint in law and therefore was a mere nullity of a process. The proper course, when there is such a mistake, is not to amend, disregarding the conditions of O. I, r. 10 of the Civil Procedure Code,

Putu(hottam V"lfdbhai 6- Co. v. M /s. !tfanilal 6- So"s

Jn1am ].

>

986

SUPREME COURT REPORTS

[ 1961]

but to seek the Court's permission to withdraw the suit with liberty to file a. fresh suit under 0. XXIII, r. 1 of the Civil Pioccdure Code on the ground of formal defect a.nd which should be done bofore limita In his opinion, it wa.s not a. ca.se of misnomer tion. It wa.s not a. ca.se of a. non or a. misdescription. existent firm or .a. non.existent person or of a. wrong description but of a. legal ba.r; a.nd when a. pie.int is filed showing tha.t the pla.ntiff wa.s not a. lega.lly recog nised person a.t a.II such a. pie.int must be regarded a.s a. nullity. He was a.lso dissatisfied with the t1xplana. tion given for filing the petition for amendment some six yea.rs after the institution of the suit.

In appeal, the Division Bench of the High Court ca.me t-0 the conclusion on a. consideration of various decisions of the High Courts in India. a.nd the courts in England tha.t "the description of a. plaintiff by a. firm na.mo in a. ca.se where the Codo of Civil Procedure does not permit a suit to be brought in the firm na.me should properly be considered a. ·Ca.so of description of the irdividua.l na.rtners of tho business and as such a. misd~script.ion which in la.w can be correct~d a.nd should not be co .. oidered to a.mount to a. description of a non.existent person". It a.lso rejected the conten tion on behalf of tho defendant that the Power of Att0rney in favour of Dunderdale was insufficient. Tho contention had been that this Power of Attorney. did not authorize Dunderdalo to act on behalf of the the firm fa.r less the individual members of the firm. Tho Division Bench accordingly allowed the amen-1- ment prayed for and permitted the names of the individual partners of the firm Manila! &; Sons to be substituted as plantiffs in the place of Ma.nllal &, Sons. The individual partners were permitted either to sign the plaint themselves or thr<!ugh their con11tituted attorneys. The Division Bench allowed this amend ment on the condition that all the costs of the appel lant before us incurred upto the date of the judgm,ent must be paid to it.

The Division Bench also allowed the appeal against the decree of P. B. Mukherjee., J., dismissing the suit, which it, set aside. Appeal No. 179 of 1960 is by

1 s.c.R. SUPREME COURT REPORTS

987

specia.l lea.ve a.gs.inst the aforesaid order of the Divi- sion Bench.

60

'9

Putushottam

It was nrged on behalf of the appellants that (1) Umedbhai &- co.

v.

&- Sons Imam J.

the plaint a.a filed wa.s a. nullity. The suit, therefore, was incompetent. To bring on the record the partners M/s. Mani/al of the firm amounted to addition of new parties a.nd if on the date these partners a.re added a.s parties and the period of limitation had elapsed then 'the entire suit would be time barred; (2) even if it be held that the plaint is not a. nullity, neither the provisions of 0. I, r. 10 nor those of 0. VI, r. 17 have any appli- cation to the case; (3) having regard to the provisions of a. 45 of the Indian Contract Act a suit by only one partner or one promisee is bad to start with. There being within the period of limitation no suit by all the partners, 1;1.ny amendment, if allowed, would convert the old suit into a new suit a.nd the new suit would be barred by limitation if the 1;1.medment was allowed on a date which was beyond the period of limitation prescribed for such a. suit; (4) if the· amendment was allowed it would be a case of adding or substituting new plaintiffs and as regards them it would be deemed to have been instituted when they were made parties. Reference to s. 22(1), Indian Limitation Act, wa.s made in this connection. In the present case, so fa.r a.s the new plaintiffs were concerned, the suit wa.s barred by time at the date when they were sought to be made parties; (5) the circmstances of the case indicated that there wa.s no suit in the eyes of the law, nor was the plaint verified or signed as required by law. Con sequently, there was no proceeding before the court in which any amendment could be sought and (6) even if it was held that the plaint was not a nullity the plaint had been signed and verified on behalf ef the ·firm. Manila! & Sons by DunderdaJe· on a Power of Attorney executed by one of the partners only. It was therefore not manifest that a.II the partners in tended to sue. Furthermore, the Power of Attorney executed in favour of Dunderdale by one of the partners could not be regarded as authorizing him to · to act on behalf of the firm of Manila.I & Sons. Very great reliance was ~laced on the decision of

1960

Pt1,.uslu>ll1nrt Um.dblksi & Co. v. M fs. M anilaJ <S- Son.(

/'""'" ].

.A-

.•

988

SUPREME COURT REPORTS

[1961]

Blackwell, J., in the case of Vyankateah Oil Mill Co. v. N. V. Velamahomed (')where the learned Judge held that the suit was brought by a.n entity which ha.d no legal existence in the eyes of Indian la.w a.nd there being no mode of procedure whereby such a.n entity wa.s permitted to sue in India., the suit, a.s framed, wa.s not mainta.i.Da.ble a.t a.II. It followed therefore that the amendment asked for could not be treated as an amendment following upon a mere misdesoription but must be treated as an a.pplica.tion for the substitu. tion of the individual persons who composed the entity whioh the la.w did not recognize. This view of Mr. J ustioe Blackwell was not accepted by Beaumont, C. J., in the ca.se of ..4.m11lakchand M ewaram v. Babulal Kana/al Taliwala (') where he expressed himself as follows:

- "I must oonfess tha.t I have some difficulty in following both the reasons and the conclusions of the learned Judge in that ca.se. It was !> ca.BB of a. suit brought in the name of a firm. carrying on business outside British India, a.nd therefore not justified by the terms ofO. 30, Civil P. C. a.nd the lea.road Judge expreSBed the view tha.t the plaintiff firm wa.s a non ~xistent entity. But the order which he subBBquently made giving leave to &~end seems inconsistent with that finding." He further held :

" But I do not see how 0. 30 ca.n affect the ques tion of fa.ct, whether a suit brought in the na.me of & firm in a case not within 0. 30 is in fa.ct a .ca.BB of mis deseription of existing persons, or a ca.se of a suit brought by a non-existent entity." In the case of Hajee Sattar Hajee Peer Mahomad v. Khuriram Benarsilal ('), the Calcutta. High Court did not accept the view expreSBed by Blackwell, J. It referred to the following observation of Farwell, L. J ., in Sadler v. Whiteman('):-

" In English law· & firm as suoh has no legal exis tence ; partners oa.rry on business both a.s principals and as agents for eaoh other within the soope of the

(1) A.LB. 1928 Bom. 191. ()) U..R. (1952] 1 cal. •'5·

(•) A.I.B. 1933 Bom. 304, 30'· (4) [1910] 1 K.B. 868, 889.

1 S.C.R. SUPREME COURT REPORTS

989

partnership business; the firm name is a. mere expres- sion, not a. legal entity, although for convenience Purushott•m under Order XL VIII-A it may be used for the sake of umedbh•i o;. c~. suing and being sued." In the case of Mura Mohid-een v. V. 0. A. Mohomed(') M/s. Manilal the Ma.drii.s High Court dissented from the opinion expressed by Blackwell, J. and the learned Judges stated :

Imam J.

& Sons

v.

'96•

" We a.re unable to agree with Blackwell, J. in his view.that a. foreign firm not being a. legal entity which could as such file a. suit. under the Civil P. C., by itself determines the .question whether the implea.d ing of the members of that firm is the addition of a. new party. The view of Blackwell, J. appears to have been· concurred in by two decisions reported in-' Neogi Ghose and Go. v. Nehal Singh', AIR 1931 Ca.I. 770 (F) and-' L. N. Ghettiar Firm v. M.P.R.M. Firm', AIR 1935 Rang. 240 (G), but we a.re unable to agree with the soundness of the reasoning in these decisions either of which do not furnish any further reasons in support of the view of Blackwell, J ." The Madras High Court then concluded as fo~lows :- " If however imperfectly and incorrectly a. party is designated in a. pie.int the correction of the error is not the addition or substitution of a. party but merely clarifies and makes apparent what was previously shrouded in obscurity by reason of the error or mis take. The question in such a oa.se is one of intention of the party and if the Court is al/le to discover the · person ·or persons intended to sue or to be sued a. mere misdescription of such a. party cltn always be correct ed provided the mistake was bona. fide vide O.I, R. 10, C.P.C. Such an amendment does not involve the addition of a. party so as to attract S. 22(1), Limita tion Act. Suits by or on behalf of dead persons stand in a different category. The principle that a. misdes cription could be corrected by amendment could not obviously be applied to such a. case but this is far from saying that merely because the law does not recognise the firm as being a. legal entity, the firm

(1) A.I.R. 1955 Mad. 294, 297, 299. 126

PurHshol/am Un1edbhai c-,. Co. v. il1 /s. Afanilal &- Sons

Imam J.

990

SUPREME COURT REPORTS

[1961]

name could not indicate or designate the individuals composing the firm."

"To surn up, the situation is analogous to a case where an individual who has a.n alias or a.n abbre viated name by which he'is Hometimes called initially describes himself in that name but subsequently applies to have it rectified so a.s to describe in the manner in which he is most generally known. Thero cannot be any dou ht that by the correction in the name, a new plaintiff is not added so as to attract s. 22(1), Limitation Act. A trade name either of a. person or a group of individuals carrying on business in partnership is in true an alias for the person or the group." Before the introduction of 0. XXX in the Code of Civil Procedure apparently suits were instituted, particularly iu the Mofussil courts, in the name of a firm or were instituted against a firm in the firm name a.nd no objection wa.s genera.By ta.ken. Presumably this practica was larg.,ly based on the assumption that the suit concerned wa.s either by all the partners of the firm or a.gs.inst all the partners of the firm. If, however, a.n objection were to be ta.ken that a suit in the name of a. firm was not maintainable because it ha.d no legal entity, the courts would have to decide whether the suit had been insti tuted by non-existent persons. If so, the suit was ca.He of Kasturchand not ma.inta.iuable. Bahiravdas v. Sagarmal Shriram (1 ), which wa.s before the introduction of 0. XXX in the Code, the suit had been brought in the name of the firm Konoanma.l Sa.garma.1 by its manager Sa.garmal Shrira.m. The defendants objected that one '.\la.la.mchand wa.s also a partner in the firm and should be ma.de a pa.rty. Ho was accordingly added as a plaintiff 011 tho 27th of January, 1888. The defendant then contended that the suit wa.s barred under s. 22, Limitation Act. It was held by the Bombay High Court that it was a 0&11e of misdescription and not of non- joinder for tho action wa.s brought in the na.me of the firm by its manager. The introduction of 0. XXX into the Code

In the

(1) p8<)2) I.L.R. 17 Bom. 413.

,A, I

..

= r

. ~·

I S.C.R.

lSUPREME COURT REPORTS

991

prevents such an objection being taken because it per mits two or more persons carrying on business of the firm to sue or be sued in the name of the firm but the firm must be carrying on business in India. The introduction of this provision in the Code was an enabling one which permitted partners constituting a firm to sue or be sued in the name of the firm. This enabling provision, however, _accorded no such facility or privilege to partners constituting a firm doing busi ness outside India. The existence of the provisions of 0. XXX in the Code does. not mean that a plaint filed in the name of a firm doing business outside India is not a suit ir: fact by the partners of that firm individually.

Section 4 of the Indian Partnership Act, 1932, here

inafter referred to as the Act, states that :

196n

Purushottam Umedbhai & Co. v. M/s. Manilal 0. Sons -.- Iniam ].

" " Partnership " is the relation between persons who have agreed to share the profits of a business · carried on by all or any of them acting for all.

Persons who have entered into partnership with one another. are called individually " partners " and collectively "a firm " and the name under which their business is carried on is called the " firm name "." It is clear from this provision of the Act that the word " firm" or the " firm name" is merely a compendious description of all .the partners collectively. It follows, therefore, that where a suit is filed in the name of a firm it is st.ill a suit by all the partners of the firm unless it is proved that all the partners had not authorized the suit. A firm may not be a legal entity in the sense of a corporation-or a compa.ny incorporat ed under the Indian Companies Act but it is still an existing concern where business is done by a number of persons in partnership. When a suit is filed in the name of a firm it is in reality a suit by all the partners of the firm. If 0. XXX had not been introduced into the Code and a suit had been filed in the name of-a 'firm it would not be a case of a suit filed by a non- .existent person. It would still be a suit by the part ners of a firm, the defect being that they were describ ed as a firm. In order to clarify matters a court .would permit an amendment by striking out the name

I \

I960

Purushottam U medbhai & Co. v. M/s. Manilal 6" Sons

ltnam ].

/ ..

992

SUPREME COURT REPORTS

[1961] ..

of the firm and replacing it with the name of the persons forming the partnership. It would be a case of misdescription. Even if the provisions of 0. I, r. 10 and 0. VI, r. 17 did not strictly apply the amend ment could be permitted under s. 153 of the Civil Pro cedure Code because it was not a case of either adding parties or substituting parties. The High Gourt referred to a number of decisions to which no particu lar reference need be made but they do support the view taken by the High Court that in the present case the plaintiff described in the plaint as the firm of Manila! & Sons was a mere misdescription capable of amendment and not a case where a plaint had been filed by a non-existent pers~n and therefore a nullity. We now refer to certain provisions of 0. XXX, • "(1) Any two or more persons claiming or being liable as partners and carrying on business in India may sue or be sued in the name of the firm (if any) of which such persons were partners at the time of the accruing of the cause of action, and any party to a suit may in such case apply to the Court for a statement of the names and addresses of the persons who were, at the time of the accruing of the cause of action, partners in such firm, to be furnished and verified in such manner as the Court may direct.

C.P.C. Order XXX, r. l, C.P.C. states:

(2) Where persons sue or are sued as partners in the name of their firm under sub-rule (1), it shall, in the case of any pleading or other document required by or under this Code to be signed, verified or certified by the plaintiff or the defendant, suffice if such plead ing or other document is signed, verified or certified by any one of such persons ". This rule enables any party to a suit filed in the name of a firm doing business in India to apply to the court for a statement of the names and addresses of the persons who were at the time of the accruing of the cause of action partners in the firm to be furnished and verified in such manner as the court may direct. Order XXX, r. 2 states:

" (l) Where a suit is instituted by partners in the name of their firm, the plaintiffs or their pleader shall,

. -'.

I S.C.R. SUPRE~IE COl'J:T J:El'OUTS

!l03

on demand in wnting by or on behalf of any defen dant, forthwith declare in writing the names and plaees of residence of all the persons constituting th\' fhm on whose behalf the suit is instituted.

(2) Wher,e the plaintiffs or their pleader fail to comply with any demand made under sub-rule (1), all proceedings in the suit may, upon :rn application for that purpose, be stayed upon such terms as the Court may direct ..

(3) Wher,e t'.1e names of the partners are declar

ed in the manner reforrcd to in sub-rule (1), the suit shall proceed in the same manner, anrl the same. con sequences in· all respects shall follow, as if they had been named as plaintiffs ip the. pla.int:

·

1960

'

rur11s/1n//l/lii V 111cd/1hni (~ co v. . \I a111f,i/

:1! /;; .

C~ S1n1s

l1111u11

j

Provided that all the proceedings shall ne\•erthl'!ess

continue in the name of the firm". This makes it obljgatory, in the case of a suit instit.11t ed by the partners in the na.me of the firm, on demand in writing by or on behalf of any defendant, to declare in writing the names and places of residence of all the persons constituting the firm on,whose behalf the suit is institutecl. If the plaintiffs fail to comply with the demand made under ,snb-r. {l) of this rule, all the pro ceedings' -in 'the suit may be stayed bn such ter,ms as the court may direct. Under s.ub-r. (3) if the names of the partners >ire declared in the manner referred to· iri sub-r, (1) the suit shall proceed 'in 'the same manner and the same consequences in all respects shall follow as if they had been na111ed in the plaint, provided that all the proceedings shall nevertheless be 'continued iu the name of the firm.. Rule 1 of 0. XXX is a g~neral provision. Huie 2, however, is confitwd to a suit instituted by partners in the name of the firm. It is clear from this rule that althmigh the suit is filed in the name oft.he firm a disclosure has to be macle, on demand)n writing by or on behalf of any (,lefrndant, of names and places of residence of all i,he persons constituting the firm on whose :gehalf the snit is instituted. ~e provisions of r. 2 would indicatp that although the suit is filed.·in the name of a ,firm, it is nonetheless a suit by all the partnern of the ii rm .;Jselosure of the names of the partners is because if

••

[I!lflll

rofin

• 11· .

/iJ1a111 J.

,,,,,,,.,""""'

v . • 11 • .,,:.1

asked for by an.v d1,fcndant, on such di•elos11r<>, t hf' suit- shall proceed as if the partners had bePn named r.,,";11.,,, ~'· ro. as plaintiffs in the suit, C'\'tn though the pruceedinf!.'l shall noverth!'less be continued in the name of tho It is clear, therefore, that the provisions of 0. firm. XXX, r. land r. 2 are enabling provisions to permit sevr.ral persons who are doing IH1Hiness as partners to 8UC or be sued in the name of the firm. Hnle 2 would not hav!' been in the form it is if tlw suit instituted in thr name of the firm was not r!'garded as, in fact, a suit hy the partners of the firm. The provi,;io11s of these rules of 0. XXX, being enabling pro,·isions, do not prc\'e11t the partners of n. firm from ~u i11g or being sued in thPir indi\'idual namPs. These rules also do not prohibit the partners of a firm suing in India in their names indi\'idually although they ma~· Le doing business outside India. Indeed, this was not rliHput!'d ~inct>, howe\ ,,r, a firm is on behalf of the appellant. 1ir1t. a legal entity the privil1•gc of suing in the name of a firm is permissible only to those persons who, as pa.rtnerH, are doing buHim•ss in lndia. Such privilege is not extrnded to pt>.rsons who are doing business as 1.n their c:a~e they ,till have partners outside India. to sue in their individual names. If, however, under some misappreheusion, persons doiug tJusiness as partners .outside India do file a plaint in th<' uame of their tirm they are misdcscribi11g thcmselrl'S, as the Huit instituted is b~' tht>lll, they being knO\rn collecti· vely as a ti rm. It sePm~, therdor<', that a plaint filed in a court in India in the name of a firm doing busi. ness outAide India is not hv its•'1f a nullitv. It is a via.int by all the partners" of the firm with- a defoctivc . description of themselvl'B for tht' purpost'B of the Code In the8e circumstances, a civil of Civil Procedure. court could permi1, under the provisions of s. 153 of the Code (or pos~ibly undPr 0. VJ, r. 17, about which we say not bing), an ameudment oft.he plaint to enable ,~ proper description of the plaintiffs to appear in it in order t.o assist the court in determining the real ques tion or issue between the parties. Strictly speaking 0. I, r. 10( I) has no applicatiou to a ci~se of this kind because the suit has not been iui;titnted in the name

Purusho!tam Umedbhai &- Co. v. .iVl/s. -111anilal &- Soris

Imam].

1 S.C.R. SUPREME COURT REPORTS

995

of a wrong person, nor is it a case of there being a doubt whether it has been instituted in the name of the right plaintiff. The provisions of 0. I, r. 10(2) also do not apply because it is not a case of any party having been improperly joined whose name has to be struck out or a case of adding a person or a party who ought to have been joined or whose presence before the court is necessary in order to enable the court effectually and completely to adjudicate upon and settle all the questions involved in the suit. The suit has been from its very inception a suit by the !Jartners of the firm and no question of adding or -subFtitutiug any person a.rises, the partners collectively being des cribed as a firm with a particular name.

One of the partners Manubhai Maganbha.i Amin was the Manager of the firm Manila! & Sons. He had executed a Power of Attorney in favour. of four per sons including one Dunderdale. By this Power he authorized any one of these persons to sue for reco very of moneys due to the firm from the firm Puru shottam Umedbhai & Co., the appellant. It also .empowered these persons to appear and to represent the firm iu any court, in any jurisdiction-civil, crimi nal, insolve.ncy, original, appellate or otherwise-and before any official in any suit or proceeding or matter and to make, sign, verify, present and file any plaint. Dunderdale had sigried and verified the plaint in the present case. We have no doubt, on a perusal of the Power of AttfJrney, that it authorized Dunderda.le to file the plaint on behalf of the firm Manila.I & Sons and also to verify it. It was suggested 'that this was a Power of Attorney by Ma.nubhai Maganbhai Amin for himself and not for the firm of Manila.I & Sons. As we understand the Power of Attorney that is not so. No doubt the Power of Attorney is not signed by all the partners of Manila.I & Sons but only by Manu bhai Maganbhai Amin. In our opinion, it was not necessary that the Power should have been signed by all the partners of the firm because Manubha.i Magan bhai Amin· was the manager of the firm. Under s. 18 of the Act a partner is an agent of the firm for the purposes of the business of the firm. Ma.nubha.i

'

-

1900

l'to1oholt.lm (:111t1El1ai 0 Co. v. J/ ;.~ . .lta11il11f , ~ So11s

Imai;; j.

!J9Li

SCPRE:.\IE COUHT REPOHTS

[19611

:llaganbhai Amin was theretore the agent of the firm It is to be noticed that under as well as its managor. s. l!l(2) of the Act instances an' stated where, in the absence uf any usage or custom of trade to the con trary, the implied authority of a par!Jwr does not em power him tu du matterH mentioned in els. (a) to (h). lt is significant th'1;t in these clauses there is no prohi bition to a partner executing a Power of Attorney in favour of an individual authorizing him to institute a In these circumstances, it suit on beh:df of the firm. cannot be said that at the tinrn the plaint was filed it was defective because the Power of Attorney in favour of Dunderdi>le was not a Power of Attorney on behalf of the firm and its partners. As the High Court has pointed out, there is on the record now Powers of Attorney on behalf of all the partners of the firm.

It seems w us that th!' Division Bench of the High Court took a correct view in holdiug that the plaint WJiS not a nullity. It was a casP of a suit instituted b}· al! the partn°ers of a firm who were misdescribed as .\lanilal & 8ons, a firm carryiug on business at No. llA Malacca Street, Singapore and accordingly the the plain't to be learned amended 011 in their order.

tc>rms and conditions stated

,Judges rightly allowed

[t. follows thcroforc that the High Court was also right in Heiting i>Hide the decree of I'. B. Mukherjea, J., dismi,;sing the suit.

Thrse appeal~ accordingly fail and must be dismiss

ed but, in t.hc circumst;rnces, without costs.

Appeals diBmissed.

•

T

.