Madras High Court
K.M.NATARAJAN
S.Ramalingam Chettiar (deceased) - Appellant
Versus
J.Prasanna Chandrasekaran - Respondent
Decided On : 10/15/1986
INSOLVENCY - AMENDMENT OF CAUSE TITLE AND PETITION - SUBSTITUTION OF SURVIVING PARTNERS - POWER OF COURT - S.90(4) OF THE PRESIDENCY TOWNS INSOLVENCY ACT, 1909 - O.V, R.1 AND R.3 OF THE INSOLVENCY RULES 1958 - S.99 OF THE PRESIDENCY TOWNS INSOLVENCY ACT - S.47 OF THE PARTNERSHIP ACT, 1932 - O.30, R.1, CODE OF CIVIL PROCEDURE - S.151 OF CIVIL PROCEDURE CODE, 1908 - O.6, R.17, CODE OF CIVIL PROCEDURE - S.108 OF THE PRESIDENCY TOWNS INSOLVENCY ACT - COURT HAS POWER TO AMEND THE CAUSE TITLE AND PETITION TO SUBSTITUTE SURVIVING PARTNERS TO CONTINUE THE PROCEEDINGS FILED BY THE DECEASED PARTNER IN THE FIRM'S NAME.
Fact of the Case:
Petition filed by the petitioning creditors under S.90(4) of the Presidency Towns Insolvency Act, 1909, for permission to amend the cause title and para (1) of the petition by substituting the names of the three surviving partners in the place of the deceased partner.
Finding of the Court:
The court held that the Insolvency Court has the power to amend the petition and substitute the surviving partners to continue the proceedings filed by the deceased partner in the firm's name.
Issues: Whether the Insolvency Court has the power to amend the cause title and petition to substitute surviving partners to continue the proceedings filed by the deceased partner in the firm's name.
Ratio Decidendi: The court relied on S.90(4) of the Presidency Towns Insolvency Act, 1909, O.V, R.1 and R.3 of the Insolvency Rules 1958, S.99 of the Presidency Towns Insolvency Act, S.47 of the Partnership Act, 1932, O.30, R.1, Code of Civil Procedure, S.151 of Civil Procedure Code, 1908, O.6, R.17, Code of Civil Procedure, and S.108 of the Presidency Towns Insolvency Act to hold that the Insolvency Court has the power to amend the cause title and petition to substitute surviving partners to continue the proceedings filed by the deceased partner in the firm's name.
Final Decision: The court allowed the petition and permitted the petitioners to be substituted themselves as partners to continue the proceedings as prayed for.
ORDER :- This application is filed by the petitioning creditors under S.90(4) of the Presidency Towns Insolvency Act, 1909, for permission to amend the cause title and para (1) of the petition by substituting the names of the three surviving partners Baburam Gagoria, Mamchand Gagoria and Subashchand Gagoria in the place of the deceased partner Kailashchand Gagoria.
2. It is alleged in the affidavit filed in support of the application by one of the partners that at the time of filing the Insolvency Petition for administering the estate of the deceased-debtor under S.108 of the Insolvency Act, his brother's name was shown in the cause title as representing the firm. His brother Kailashchand Gagoria died at Madras on 18-8-1986. It is further averred that the names of all the partners are given in the Insolvency Petition in para (1). Since the respondent's counsel has taken an objection that the partner, who represented the firm died, the matter cannot be proceeded further unless the other partners are shown as representing the firm. It is further submitted that inasmuch as the names of the other partners have already been shown in para (1) of the Insolvency Petition, permission is sought for, to amend the cause title of the Insolvency Petition by substituting the names of the other partners for the name of the deceased partner and that no prejudice will be caused to the respondent while doing so. It is also further averred that all the partners concurred in filing the Insolvency Petition.
3. This application is resisted by the 1st respondent, who is the only respondent in the main Insolvency Petition. He inter alia contended as follows :-
The main petition, I. P. No. 45 of 1984, was filed by Kailashchand Gagoria alone as representing the 1st petitioner-firm and no other person has represented the same. Further, the names of the other partners are not finding a place in the cause title. Since in the main petition, all the partners were not added, the statutory requirement was not fulfilled. It is further reiterated that one of the several joint creditors cannot file an Insolvency Petition against the debtor. At this stage, the third-party-petitioning-creditors cannot implead themselves as petitioners by amending the cause title by substituting their names. It is also contended that there is no provision in the Partnership Act that in the event of death of one of the partners, the other partners can be substituted in the place of the deceased partner. Under the guise of this application, the third-parties are sought to be added as legal representatives of the deceased partner. The petition filed under S.90(4) of the Presidency Towns Insolvency Act is not maintainable and hence he prays for dismissal of the application.
4. The learned counsel for the petitioner drew my attention to the main Insolvency Petition filed in this case, wherein the first petitioner is the firm, namely, Messrs Mohan Steel Corporation and it was represented by its partner Kailashchand Gagoria. While describing the 1st petitioner-firm in the first para of the long cause title, the other partners of the firm, namely the present petitioners are shown as partners of the first petitioner-firm with their addresses. The contention of the respondent in this case is that the main petition filed on behalf of the firm by one of the partners itself is not maintainable and as such the main petition itself is liable to be dismissed. Under O.V, R.1 of the Insolvency Rules 1958, it is provided as follows :-
"When any petition, notice or other document is signed by a firm of creditors or debtors in the firm's name, the partner signing for the firm shall add also his own signature in the following manner :
'B and Co., by A. B., a partner in the said firm'".
In this case also, the deceased partner has signed "For Mohan Steel Corporation, as Partner". Learned counsel for the respondent submitted that under R.3 of O.V of the Insolvency Rules, if an insolvency petition was fil
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