Back
ANDHRA RADESH STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, HYDERABAD
Hon’ble Mr. Justice S. Parvatha Rao, President;
Mr. K. Ranga Rao & Dr. (Mrs.) Mamata Lakshmanna, Members
PRUDVI AGRO FARMING AND FINANCE COMPANY—Appellant
versus
KRISHNAMURTHY SATYANARAYANA—Respondent
F.A. No. 70 of 1999—Decided on 22.2.1999
Counsel for the Parties :
For the Appellant :Mr. M. Venkataramana Reddy, Advocate.
For the Respondent: Admission stage.
All partners of a registered firm are jointly and severally liable for all acts of the firm while they are partners. It is not mandatory to implead all partners in a complaint against the firm under the Consumer Protection Act, 1986.
Headnote:
PARTNERSHIP - LIABILITY OF PARTNERS - JOINT AND SEVERAL LIABILITY - IMPLEADING ALL PARTNERS NOT MANDATORY - CONSUMER PROTECTION ACT, 1986 - SECTION 25 OF THE INDIAN PARTNERSHIP ACT, 1932.
Fact of the Case:
The complainant deposited Rs. 30,000/- in the appellant firm in units of Rs. 3,000/- each. The appellant firm issued receipts for the same. However, the complainant did not receive the deposit receipts in printed forms as promised. He approached the District Forum seeking the repayment of Rs. 30,000/- with interest and compensation for mental agony and hardship.
Finding of the Court:
The District Forum partly allowed the complaint and directed the appellant firm to refund Rs. 30,000/- to the complainant with interest at 24% per annum from the date of deposit till the date of payment and also Rs. 1,000/- towards costs. The District Forum held that the appellant firm was liable to pay the amount since it was a joint and several liability under Section 25 of the Indian Partnership Act, 1932.
Issues: 1. Whether it is mandatory to implead all partners of a firm in a complaint against the firm under the Consumer Protection Act, 1986? 2. Whether the appellant firm was liable to pay the amount deposited by the complainant even if all the partners were not impleaded in the complaint?
Ratio Decidendi: 1. Section 25 of the Indian Partnership Act, 1932 provides for joint and several liability of partners for all acts of the firm while they are partners. This does not require that all partners should be impleaded in an action against the firm. 2. Order 30 Rule 1 of the Code of Civil Procedure, 1908, which is applicable to complaints under the Consumer Protection Act, 1986, allows partners to sue or be sued in the name of the firm. 3. Section 69(2) of the Indian Partnership Act, 1932 states that a suit to enforce a right arising from a contract cannot be instituted against a firm unless the firm is registered and the persons suing are shown as partners in the Register of Firms.
Final Decision: The court dismissed the appeal filed by the appellant firm against the order of the District Forum. The court held that the complaint was not bad for non-impleadment of all the partners of the appellant firm and that the appellant firm was liable to pay the amount deposited by the complainant.
Mr. Justice S. Parvatha Rao, President— This is an appeal preferred by the opposite party in O.P. No. 196/1997 against the order of the Srikakulam District Forum in that O.P. dated 31.12.1998 partly allowing that O.P. and directing it to refund Rs. 30,000/- to the complainant together with interest at 24% per annum from 24.6.1997 till the date of payment and also Rs. 1,000/- towards costs. The complainant before the District Forum is the respondent before us. We do not find any merit in this appeal. The facts are in a very brief compass. It was the case of the complainant before the District Forum that pursuant to the invitation for deposits made by the appellant he deposited in all a sum of Rs. 30,000/- in units of Rs. 3,000/- each i.e. in all ten (10) units - a sum of Rs. 3,000/- paid by way of a cheque dated 12.7.1996 for one unit (evidenced by Ex. A-1 receipt); and a sum of Rs. 27,000/- paid in cash towards nine (9) units (evidenced by Ex. A-2 receipt dated 19.7.1996). The complainant was aggrieved that even after receiving Rs. 30,000/- the deposit receipts in printed forms were not handed over to him as promised. In May, 1997 when he approached the office of the appellant he found it locked and then he gave legal notice dated 24.6.1997 (xerox copy of which marked as Ex. A-3) to which he received a reply legal notice given on 5.7.1997 from the appellant (xerox copy of which marked as Ex. A-4). Then he approached the District Forum for redress seeking the repayment of Rs. 30,000/- together with interest at 24% per annum from 22.7.1996 till the date of realisation and also Rs. 10,000/- for mental agony and hardship and Rs. 2,000/- towards costs. The opposite party received notice in the O.P. and filed its version/counter. It was stated in the counter that the appellant firm was formed with four partners, one of whom was Smt. J. Ramani Bai. When she was asked by other partners to contribute her share to the firm she arranged a loan of Rs. 3,000/- through the complainant and that subsequently disputes arose between the partners and because of that there was no proposal for receiving any deposits and issuance of units and that if the complainant paid Rs. 27,000/- he would have at least taken a hand receipt if printed receipts were not available. Thus the receipt of Rs. 27,000/- in cash was denied and also the receipt of Rs. 3,000 / - towards deposit was also denied.
2. The District Forum accepted Exs. A-1 and A-2 receipts finding that they were signed by the Managing Partner of appellant firm, Sri R. Suryaprakasa Rao, with the stamp of the firm showing that they were issued on behalf of the appellant firm. A copy of the partnership deed dated 4.5.1996 (marked as Ex. B-1) constituting the appellant firm was filed before the District Forum. The District Forum was satisfied that the signatures on Exs. A-1 and A-2 were similar to the signature of Sri R. Suryaprakasa Rao in the partnership deed (Ex. B-1). It was contended before the District Forum on behalf of the appellant firm that when the document was questioned before it as not genuine the matter should be referred to the Civil Court. That contention was rejected by the District Forum relying on the decision in Nagarwal Construction Company v. Suresh Kumar, II (1997) CPJ 88 (NC)=1997 (2) CPR 69, wherein the National Commission rejected the proposition that “whenever the documents produced before the Consumer Redressal Agencies are questioned, the matter should be referred straight away to the Civil Court”. It was also contended before the District Forum that Sri R. Suryaprakasa Rao received the amount from the complainant in his individual capacity. That contention was rejected by the District Forum holding that Exs. A-1 and A-2 receipts were issued by him in the name of the appellant firm signing as Managing Partner of the firm. The District Forum also held that when a firm was held to be liable, all the partners also would be liable to pay the amounts since it was a joint
