1989 Supreme(Raj) 852
RAJASTHAN HIGH COURT AT JAIPUR BENCH
D.L.Mehta, J.
Ratan Lal - Appellant
Versus
M/s Shyam Sunder & Ors - Respondent
S.B. Civil Revision Petition No. 106 of 1989.
Decided On : 22-09-1989
A partner in a partnership firm is not a necessary party to a suit against the firm, unless the firm is a distinct legal entity.
Headnote:
IMPLEADING PARTNERS AS PARTIES IN SUIT AGAINST PARTNERSHIP FIRM - ORDER 30 RULE 1 CPC - PARTNER NOT NECESSARY PARTY - EXCEPTION - INTEREST OF FIRM TO BE PROTECTED - INTERNAL DISPUTES NOT TO BE RAISED.
Fact of the Case:
Plaintiff filed a suit for ejectment against the partnership firm M/s Ramgopal Ratanlal. Ratanlal, a partner in the firm, moved an application to be impleaded as a party, claiming that he was a necessary party to protect the interest of the firm.
Finding of the Court:
The court held that Ratanlal was not a necessary party to the suit, as the partnership firm was not a distinct legal entity and the suit had been instituted against the firm through one of its partners. However, the court allowed Ratanlal to be impleaded as a party in order to protect the interest of the firm, with the condition that he would not raise any internal disputes between the partners.
Issues: Whether a partner in a partnership firm is a necessary party to a suit against the firm.
Ratio Decidendi: Order 30 Rule 1 CPC provides that any two or more persons claiming or being liable as partners and carrying on business in India can be sued in the name of the firm. However, this rule is an exception to the general rule that all persons interested in the subject matter of a suit must be joined as parties. In the instant case, the court found that the partnership firm was not a distinct legal entity and that the suit had been instituted against the firm through one of its partners. Therefore, Ratanlal was not a necessary party to the suit.
Final Decision: The court allowed Ratanlal to be impleaded as a party in order to protect the interest of the firm, with the condition that he would not raise any internal disputes between the partners.
JUDGMENT
1. - Heard learned counsel for the parties.
2. Applicant Ratanlal, moved application before the trial court with the prayer that he should be impleaded as a party. Suit was instituted by the plaintiff against the defendant M/s Ramgopal Ratanlal and M/s Sagar Enterprises for the ejectment. It was submitted that shop was let out to M/s Ram Gopal Ratanlal, by the plaintiff. Suit for ejectment was filed on various grounds and it is not necessary to refer them in this revision petition.
3. Mr. C.K. Garg, learned Sr. counsel for the petitioner in this court has argued that his client is a necessary party and to protect the interest of the film M/s Ramgopal Ratanlal, he should be allowed to be added as a party. He further submits that Ramgopal, the other partner has been impleaded as a partner (sic party) and there is a dispute pending about the partnership firm and the suit is pending. It was also submitted that for the last number of years, shop is not running and it is locked and there is a report of the Commissioner, about this fact. He further submits in case of collusion between plaintiff and Ramgopal, his client Ratnal will suffer.
4. On the other hand, Mr. Lodha submits that the applicant is not a necessary party and no party can be impleaded against the wishes of the plaintiff.
5. Mr. Garg, submitts that the plaintiff has also agreed now that the applicant should be impleaded as a party. On this point, Mr. Lodha, submits that the smell of collusion may be there. In the trial court the plaintiff has opposed the addition of the party.
6. Mr. Garg cited before me the case of Malabar Fisheries Co. v. the Commissioner of Income Tax, AIR 1980 S.C. 176 and submitted that the partnership firm under the Partnership Act, is not a distinct legal entity. Apart from the firm as such has no separate rights of its own, in the partner-ship assets and when one talks of the firms property or firms assets, it means the property or assets of partners in which they have a joint and common interest. The case cited by Mr. Garg, relates to the In Income-Tax provisions. Under Section 14 of the Partnership Act, even the immovable property may be thrown in the partnership firm by the partners.
7. Mr. Lodha also cited before me the case of Munshi Ram v. Vimal Kumar, 1985 (1) Rent Law Reporter 505 , While dealing with the provisions of East Punjab Restriction Act. 1949. Punjab & Haryana High Court, has held that in a suit for eviction of tenant from shop the partner as tenant has no locus standi to be impleaded as a party in the proceedings of the ejectment against the tenant. The case cited by Mr. Lodha does not apply in the facts and circumstances of the present case. In the instant case the tenant is the firm and it is not necessary that any partner should be impleaded as a patty to the suit under the provisions of O.30 Rule 1 CPC. The law is well settled on this point and the partnership is not a legal distinct entity. At the same time. in the matter of filing a suit by the firm or against the firm the procedure has been laid down under Rule I of O. 30 CPC. For the purpose of filing the suit only the firm can be considered to a limited extent as a legal pasty may not be as a legal distinct entity and the suit can be instituted by or against the firm by impleading firm as a party. In the instant case, the suit has been instituted against the firm and not against any of the partners. In the plaint, it has been specifically mentioned that M/s Ramgopal Ratanlal is the partnership and suit has been filed only against firm through one of its partners. It has come in pleadings M/s Ramgopal Ratanlal, is a partnership firm. The court below has given a finding thatokn xzLr QeZ jkexksiky jruyky dh fdjk,nkjh esa gS tks Hkkxhnkjh gSA"There is a report of the Commissioner, that in between Ramgopal and the present petitioner Ratanlal, litigation is going on and the firm is not running for the last 5 years or so.
8. Mr. Lodha, cited before me the case of Parb
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