JUDGMENT:

S.B. SINHA, J. -- Leave granted.

2. Appellants herein were defendant Nos. 4 to 7 in the suit. Plaintiff-respondent No.1 filed the suit against them and four others. They are admittedly partners of defendant No.1 firm, M/s. AR. AS & P.V.PV , registered under the Partnership Act, 1932. Defendant No.3 P. Shankar (Respondent No.4 herein) was also a partner in the said firm.

3. Allegedly, Defendant No.2, P.V. Purushothaman (Respondent No.3 herein), who has been described as the Managing Partner of the said firm, fraudulently obtained an advance from the plaintiff wherefor a personal guarantee was furnished by the defendant No.2. Indisputably a cheque for a sum of Rs. 50 lakhs was issued in the name of the defendant No.1.

4. Plaintiff-Respondent filed the aforementioned suit for realisation of a sum of Rs.70,30,000/- with interest @ 20% per annum inter alia alleging that all the defendants were jointly and severally liable therefor. An application under Order XXXVIII Rule 5 of the Code of Civil Procedure was filed by the plaintiff.

5. Appellants in their written statement inter alia raised a contention that since the amount of Rs. 50 lakhs purported to have been taken in advance by defendant No.2 in connivance with defendant Nos. 3 & 8 had not been used for the benefit of the partnership firm, no order of attachment could be issued as against the appellants herein. The said contention of the appellants was accepted by a learned Single Judge of the High Court by his order dated 10th December, 2002 opining :-

The copy of the partnership deed date 01-4-1996 has been filed by the contesting defendants in the typed set. A perusal of the same clearly disclosed that the 2nd Defendant was not a partner in the 1st defendant firm. Moreover, the plaintiff had also not filed any record to show that the 2nd defendant was already in a partner (sic) in the 1st defendant firm and the borrowal was also made only for the firm. Unless and until, it is established by the plaintiff, I am of the view that the plaintiff is not entitled to seek any interim order calling upon the defendants to execute a security.

6. An intra court appeal was preferred thereagainst wherein a Division Bench of the High Court by reason of the impugned judgment opined :- The Learned Judge has not appreciated that the 3rd Defendant who is the partner of the firm as per the partnership deed dated 1-4-1996 executed the promissory notes and clause 10 of the partnership firm gives power to a partner to borrow monies (sic) from the 3rd parties for the purpose of business. The 2nd Defendant gave a letter which is only for personal guarantee. So, the reasonings given by the Leaned Judge that since the 2nd defendant is not a partner, the borrowal of money is not for the benefit of the partnership cannot be countenanced. When the cheque was given in the name of the firm by the Plaintiff, prima facie, it has to be taken that it is borrowed on behalf of the partnership firm. When the payment of the money by the Plaintiff in the firm is not in dispute and in the absence of any specific allegation that the amount was paid personally to the defendants, 2, 3 and 8, though the cheque was issued in the name of the firma and the Plaintiff also colluded with them, the argument of the Learned Counsel regarding the alleged collusion cannot be accepted. Whether the amount is used for the firm or personally by the defendants 2, 3 and 8 can be gone into only after adducing evidence. Prima facie, we find that since the amount was paid in the name of the firm and promissory notes were executed by the partners of the firm and no other partnership deed is produced before the Court other than that the partnership dated 1-4-1996, the learned Judge is not correct in rejecting the Application as if the plaintiff has no prima