Heirs of a deceased partner in an unregistered partnership cannot substitute in proceedings as the partnership dissolves upon the partner's death unless explicitly allowed by the partnership deed.

JUDGMENT :

Sabyasachi Bhattacharyya, J.

1. The present writ petition arises out of a proceeding initiated on the application of one Arun Chandra Khanna (since deceased), in his capacity as a partner of a partnership firm namely M/s Khanna & Sons, for declaration that the disputed property is a Thika Tenancy Property and the said partnership firm is the Thika Tenant/Returnee. During the pendency in the said proceeding, the said Arun Chandra Khanna died, leaving behind the respondent nos.6 to 8 herein as his heirs and legal representatives, who filed an application for getting substituted as the applicants in the proceeding. The Thika Controller refused such application by an order dated March 27, 2014, which was challenged by them by filing an Original Application before the West Bengal Land Reforms and Tenancy Tribunal. The First Bench of the Tribunal, by the impugned order dated July 26, 2024, allowed such application, against which the present writ petition has been preferred.

2. Learned senior counsel for the petitioner argues that the partnership firm being unregistered, the application was not maintainable in the first place. As such, the substitution application was rightly rejected by the Thika Controller. The present petitioner-Company’s predecessor-in-interest purchased the property from one Satrughna Kanta Acharyya, the alleged exclusive owner of the disputed property, upon a partition having been affected between the co-owners of the same. It is argued that there were originally four partners of the firm, namely Prem Chandra Khanna, Mohan Chandra Khanna, Tarun Chandra Khanna and Arun Chandra Khanna. Prem Chandra Khanna had died earlier. Mohan Chandra Khanna and Tarun Chandra Khanna filed affidavits before the Thika Controller stating that M/s Khanna & Sons was not a Thika Tenant in respect of the disputed premises at any point of time.

3. Mohan Chandra Khanna also died on April 11, 2017, leaving behind Tarun Chandra Khanna, the respondent no.9, and Arun Chandra Khanna as the only partners of the said unregistered firm.

4. It is argued by learned senior counsel for the petitioner that the partnership firm has dissolved automatically on the demise of Arun Chandra Khanna, since only one partner, namely, Tarun Chandra Khanna survived and, in order to constitute a partnership, there has to be more than one partner.

5. Thus, the proceeding itself has abated before the Controller upon the demise of Arun Chandra Khanna and there is no scope of substitution of his heirs.

6. Learned senior counsel contends that in a proceeding instituted by a partnership firm, there cannot be any substitution of the heirs and legal representatives of one of the partners, in their personal capacity, on his demise, unless there is a specific clause in the partnership deed to such effect. Clause 5 of the partnership deed of the firm M/s Khanna & Sons specifically stipulates that on the death of any of the partners, discretion lay on the surviving partners to continue the firm by themselves or by taking the legal representative of the deceased partner as partners in the firm in his place or by taking a new partner. In the present case, since no such exercise was done in respect of the heirs of Arun Chandra Khanna by the sole surviving partner Tarun Chandra Khanna, it is argued that the respondent nos. 6 to 8, who were the substitution applicants, have no locus standi to be impleaded in the proceeding.

7. Learned senior counsel next contends that the Tribunal erroneously applied the exception under Section 69(3) of the Partnership Act, 1932 (hereinafter refer to as the “Partnership Act”), which has no application, since the proceeding is not for dissolution of the partnership firm.

8. Learned senior counsel argues that since the sole surviving partner Tarun Chandra Khanna has taken a specific stand that the disputed property is not a Thika Tenancy, the proceeding does not survive. It is further argued that the Tribunal, while deciding the substitution appl