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IN THE HIGH COURT OF DELHI AT NEW DELHI
Chandra Dhari Singh, J.
Babita Bansal – Appellant
Versus
M/s Hari Om Chemicals – Respondent
C.R.P. 22 of 2023 and CM APPL. Nos. 4728 of 2023 and 4730 of 2023
Decided On : 09-08-2023
CPC - Application under Order VII Rule 11 - Section 115 - [The court discussed the application under Order VII Rule 11 of the CPC and Section 115, and upheld the impugned order dismissing the application. The court emphasized the legal representative's liability for the debts of a deceased sole proprietor and the scope of revisional powers under Section 115 of the CPC.]
Fact of the Case:
The petitioner sought to set aside an order dismissing their application under Order VII Rule 11 of the CPC, arguing that a suit against a dead person cannot be filed. The respondent sought to recover an outstanding amount from the legal representative of the deceased sole proprietor, the petitioner. The trial court dismissed the application, leading to the present revision petition.
Finding of the Court:
The court found that the legal representative, the petitioner, is liable for the debts of the deceased sole proprietor and upheld the impugned order dismissing the application under Order VII Rule 11 of the CPC. The court also found no error of jurisdiction or other error warranting interference under Section 115 of the CPC.
Issues: The main issue was whether the trial court erred in rejecting the application under Order VII Rule 11 of the CPC. The court also considered the scope and nature of Section 115 of the CPC.
Ratio Decidendi: The court held that the legal representative is liable for the debts of a deceased sole proprietor and upheld the impugned order. The court also emphasized the limited scope of revisional powers under Section 115 of the CPC.
Final Decision: The revision petition was dismissed, and the impugned order was upheld.
Key Points: - The legal representative (wife) of a deceased sole proprietor is held liable for the debts of the sole proprietor; the court upheld the impugned order dismissing the Order VII Rule 11 CPC application. (!) (!) (!) - Order VII Rule 11 CPC empowers the court to reject a plaint if it is hit by infirmities, and the relevant material is the averments in the plaint; the trial court can decide at any stage before trial concludes. (!) (!) (!) - The scope of Section 115 CPC is supervisory; it does not permit interference for mere erroneous decision on maintainability and is limited to questions of jurisdiction and material irregularities. (!) (!) (!) - The petition seeking set-aside of the Order dated 10-11-2022 was dismissed; the impugned order was upheld. (!) (!) - The legal representative is defined under Section 2(11) CPC as a person who represents the estate of the deceased and may be sued in a representative capacity; in this case, the petitioner (Babita Bansal) is held as the legal representative. (!) (!) (!) - The trial court’s reasoning that debts of the sole proprietorship are obligations of the proprietor; upon death, liabilities accrue to the legal representative, and the respondent is entitled to recover from the legal representative. (!) (!) (!)
ORDER
Chandra Dhari Singh, J. (Oral)
1. The present Civil Revision Petition under Section 115 of Civil Procedure Code (CPC) has been filed by the petitioner seeking the following reliefs:
"It is therefore most respectfully prayed that this Hon'ble Court may kindly be pleased to set aside the impugned Order dated 10-11-2022 passed by Sh. Gurdeep Singh, District Judge (Commercial Court) North West District, Rohini Courts, Delhi in the CS (COMM) 56/2022 titled as M/S HARI OM CHEMICALS VS. M/S TOY MAKER and kindly dismiss the above-mentioned Civil Suit bearing no: CS (COMM) 56/2022 titled as M/S HART OM CHEMICALS VS. M/S TOY MAKER pending before the trial Court of Rohini Courts
Any other relief which this Hon'ble Court may deem fit and proper under the facts and circumstances of the case, may also be passed in favor of the Petitioner/Revisionist and against the Respondent."
2. The relevant facts that lead to the filing of the instant revision petition are reproduced herein:
a. The husband of the petitioner/defendant died on 21st May 2021. On 19th October 2021 the respondent/plaintiff issued a legal notice to the petitioner seeking recovery of an outstanding amount of Rs.12,28,738/- with respect to the alleged goods supplied by the petitioner's husband to the respondent/plaintiff.
b. The petitioner replied to the said legal notice on 6th November 2021, stating therein to the effect that the petitioner is not legally liable to make any payment in respect of the Sole Proprietorship firm i.e., M/s Toy Maker which was owned by the petitioner's husband and has closed on 21st May 2021 due to death of the petitioner's husband.
c. On 7th January 2022, the respondent/plaintiff filed a civil suit bearing No. CS(COMM)/56/2022 for the recovery of Rupees12,28,738/- against M/S Toy Maker (through its Proprietor Mr. Mohit Bansal, now Deceased) and had also made the present petitioner as Defendant being the legal heir of Late Sh. Mohit Bansal, the Sole Proprietor of M/s Toy Maker.
d. On 12th April 2022, the petitioner filed her Written Statement along with a reply to the miscellaneous applications before the Trial Court.
e. The petitioner also filed the instant application under Order VII Rule 11 of the CPC for seeking dismissal of the Suit, which was subsequently dismissed by the Trial Court vide order dated 10th November 2022.
3. Learned counsel appearing on behalf of the petitioner submitted that the present petition has been filed by the petitioner being aggrieved of the impugned order dated 10th November 2022 passed by the learned Trial Court whereby the application of the petitioner under Order VII Rule 11 of the CPC was dismissed.
4. It is submitted that the impugned order dated 10th November 2022 is liable to be set aside since the learned Trial Court has not applied its mind judiciously and committed a grave miscarriage of justice. It is well-settled law that a Suit against a dead person cannot be filed.
5. It is submitted that the impugned order is liable to be set aside since the learned District Judge has not appreciated the factum that a Sole Proprietorship firm is a separate legal entity and with the death of the Sole Proprietor it becomes non-existent and thus no suit can be instituted against the legal representative of the sole proprietor.
6. It is contended that the impugned order is tainted with arbitrariness, as the learned Judge did not consider the admission of the petitioner regarding the death of the Sole Proprietor before filing the Suit which is clearly reflected in the memo of parties as well as in the pleadings of the main suit.
7. In view of the foregoing paragraphs, the learned counsel for the petitioner submitted that the instant petition may be allowed and the reliefs sought may be granted thereby setting aside the impugned Order dated 10th November 2022 passed by the learned District Judge (Commercial Court) North West District, Rohini Courts, Delhi in CS (COMM) 56/2022.
8. Per Contra, the learned counsel for the r
The legal representative of a deceased sole proprietor is liable for the debts of the sole proprietor, and the scope of revisional powers under Section 115 of the CPC is limited.
The main legal point established is the limited scope of revisional jurisdiction under Section 115 of the CPC and the importance of the averments in the plaint in deciding the rejection of a plaint u....
The amendment to Order XXII Rule 4 of the CPC aims to ensure the continuation and culmination of effective adjudication and to prevent the proceedings from coming to an end summarily due to the death....
The court emphasized the importance of ascertaining the extent of inheritance of the defendants in the commercial entities before allowing an application under Order 7, Rule 11 of Civil Procedure Cod....
The main legal point established in the judgment is the scope of revisional powers under Section 115 of the CPC and the principles of rejection of plaint under Order VII Rule 11 of the CPC.
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