Madras High Court
RAMAPRASADA RAO,RATNAVEL PANDIAN
M.C.S.Rajan - Appellant
Versus
National Nail Industries, Tiruchirapalli - Respondent
Decided On : 04/03/1975
CIVIL PROCEDURE CODE - SUIT BY SOLE PROPRIETOR - PRESENTATION OF PLAINT BY MANAGER - RATIFICATION BY PROPRIETOR - MAINTAINABILITY OF SUIT - SECTIONS 196 AND 199 OF THE INDIAN CONTRACT ACT - ORDER VI, RULES 14 AND 15 OF THE CIVIL PROCEDURE CODE.
Fact of the Case:
A sole proprietorship concern filed a suit for recovery of money due on accounts. The suit was filed by the Manager of the concern, who signed and verified the plaint. The defendants contended that the suit was not maintainable as it was not made clear how the Manager could sue on behalf of the proprietor, who had not filed the suit in his individual name.
Finding of the Court:
The court held that the suit was maintainable. It held that the Manager had the requisite authority to present the plaint, sign the same and verify the same, and that the ratification of the Manager's act by the proprietor cured any irregularity in the presentation of the plaint.
Issues: Whether the suit was maintainable as it was not made clear how the Manager could sue on behalf of the proprietor, who had not filed the suit in his individual name.
Ratio Decidendi: The court relied on the common law principle of ratification of an act by a principal, as well as Sections 196 and 199 of the Indian Contract Act and Order VI, Rules 14 and 15 of the Civil Procedure Code. It held that the Manager had the requisite authority to present the plaint, sign the same and verify the same, and that the ratification of the Manager's act by the proprietor cured any irregularity in the presentation of the plaint.
Final Decision: The court allowed the appeal and remanded the case to the trial court for a decision on the merits.
RAMAPRASADA RAO, J:. - A very short question arises in the appeal. Plaintiff filed a suit for recovery of money due on accounts. The plaintiff was admittedly a sole proprietary concern of which one Padmanabhan was the sole proprietor. He was trading under the name and style of M. C. S. Rajan and Company. He had a Manager by name Narayanan. The defendants owed on account and dealings a sum of Rs, 22,361.83. As per the books of accounts, the amount due was arrived at and the plaintiff claimed interest at 12% per annum on the outstandings so struck in the accounts. The plaintiffs gave notice Ex. A-2 prior to the suit and the defendants replied that so much amount was not due as the goods were priced at a very high rate not agreed to specifically between the parties. The plaintiff, therefore on the basis of his accounts came to Court. While instituting the suit, the cause title was correctly given as M.C.S. Rajan and Company and in paragraph 1 thereto, the company was described as the sole proprietary concern of Padmanabhan. It was also stated that the suit was being filed by its Manager M. A. Narayanan. Obviously this was done since the claim will be barred by limitation, if there was any delay in the matter of the filing of the action. The plaint was verified by Mr. Narayanan as Manager of the plaintiff-firm. The plaintiff sought for the usual money decree. The plaint was duly numbered without any objection by the Court. The defendants in their written statement after raising several pleas on merits, said that the suit as framed was not maintainable as it is not made clear as to how the Manager can sue on behalf of the plaintiff's proprietor Padmanabhan
who has not filed the suit in his individual name. As in our view it is not necessary to consider the merits in the defence as is presently seen, we are not stating the defence in full.
2. The main question and controversy touched upon by the defendants in their defence was that the suit as framed and as presented by Mr. Narayanan as the Manager of the proprietary concern was not maintainable.
The following issues were framed for trial.
(1) What is the agreed price of goods?
(2) Whether the statement of account of plaintiff is correct?
(3) Whether the plaintiff is entitled to interest?
(4) Whether the suit is barred by limitation?
(5) Whether the suit is not maintainable for the reasons stated in para. 10 of the written statement?
(6) Whether this court has no jurisdiction to try this suit ?
(7) To what reliefs, if any is the plaintiff entitled?
3. On all the issues excepting Issue No. 5, the learned trial Judge agreed with the plaintiff. But on Issue No. 5, he was of the view that as the authority which enabled Narayanan to sign plaint and verify the pleadings was not produced at or about the time when the suit was filed by him, the presentation of the plaint is irregular and the acceptance of the same ought not to have been done and hence no decree can be passed, even though there is no real defence on the merits of the case. The learned trial Judge was of the view that as Padmanabhan has not signed the plaint and as Narayanan did not produce the power of attorney on the day when he signed the pleading and as Ex. A-20, the power of attorney, under which the act of Narayanan was ratified by Padmanabhan was produced late and in particular at the time of trial, the learned trial Judge, while agreeing with the plaintiff on all the other issues, found against it on Issue No. 5 and held that the suit was not maintainable. It is as against this portion of the judgment which has of course resulted in the dismissal of the suit that the appeal has been filed. In our view, this is a case in which the sole proprietary concern whose proprietor was Padmanabhan and whose name also has been disclosed as such is the plaintiff. One way by which a sole proprietor who has a trading style can file a suit in respect of his commercial activity is by signing the plaint himself as proprietor or causing
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