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2021 Supreme(Online)(KER) 4240
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE N.NAGARESH THURSDAY,THE 25TH DAY OF MARCH 2021/4TH CHAITHRA,1943 WP(C).No.3110 OF 2021(K)
PETITIONERS:
1 NISHA M., W/O.SAJIN, AGED 40 YEARS, MANAGING PARTNER, M/S.MONGAM INDANE SERVICES, INDANE DISTRIBUTOR, RESIDING AT KILIKKOTTUTHODUVIL HOUSE, MONGAM P.O., MALAPPURAM DISTRICT, PIN - 673 642.
2 LAJIN D.L., S/O.LATE DIXON, AGED 40 YEARS, PARTNER OF M/S.MONGAM INDANE SERVICES, INDANE DISTRIBUTOR, RESIDING AT BAGALETH QUARTERS, FEDERAL BANK BUILDING, KOZHIKODE ROAD, MONGAM P.O., MALAPPURAM DISTRICT, PIN - 673 642.
BY ADVS.
SRI.R.SURENDRAN KUM.S.MAYUKHA RESPONDENTS:
1 THE STATE BANK OF INDIA, MONGAM BRANCH, REPRESENTED BY THE MANAGER, STATE BANK OF INDIA, MONGAM BRANCH, MONGAM P.O., MALAPPURAM DISTRICT, PIN - 673 642.
2 BINU V.M., S/O.MATHEW, AGED 34 YEARS, NOW RESIDING AT BIG B STORE BUILDING, NEAR MONGAM INDANE LPG GODOWN THADAPPARAMBU ROAD, MONGAM P.O., MALAPPURAM DISTRICT, PIN - 673 642.
R1 BY ADV. SHRI.TOM K.THOMAS R2 BY ADV. SRI.T.C.KRISHNA R2 PREETHI RAMAKRISHNAN THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 25-03-2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
N. NAGARESH, J.
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W.P.(C) No.3110 of 2021 `````````````````````````````````````````````````````````````
Dated this the 25th day of March, 2021
['R SURENDRAN', '', 'KUM S MAYUKHA', 'SHRI TOM K THOMAS', 'SRI T C KRISHNA']
J U D G M E N T
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The petitioners, who are Partners of a Firm engaged in the distribution and sale of LPG in retail to consumers, are before this Court seeking to quash Ext.P10 e-mail intimating the stoppage of internet banking facility of Current Account of the Firm and to direct the 1st respondent to restore the internet banking facility of the Current Account.
2. The petitioners state that they are Partners of M/s. Mongam Indane Services. The Partnership Firm is registered. The 1st petitioner was selected by Indian Oil Corporation for appointment as Distributor of LPG. On issuance of Ext.P2, the 1st petitioner spent the entire amount for establishment of the infrastructure facilities of the LPG distributorship. On 05.04.2019, the 1st petitioner entered into partnership with the 2nd petitioner and the 2nd respondent. The 2nd respondent promised to contribute ₹20 lakhs to the Firm as his share capital. But, the amount was not paid. 3. The 2nd respondent later started joining hands with nearby Gas Agency and started to cause trouble to the petitioners' business. The 2nd respondent has criminal background, contends the petitioners. The Partnership Firm had an account with the 1st respondent-Bank and was operating a Current Account. All the three Partners were jointly operating the Account. The 2nd respondent was convicted by a criminal court. The petitioners reported the conviction of the 2nd respondent to the Oil Company. Infuriated by the action of the petitioners in communicating the conviction, the 2nd respondent approached the 1st respondent-Bank and instructed to stop all net banking transactions. The 1st respondent thereupon stopped internet transaction in respect of the Account of the Firm.
4. The petitioners filed W.P.(C) No.11337/2020.
Pursuant to an interim order passed in the said writ petition, the 2nd respondent withdrew his instructions given to the 1st respondent-Bank and thereafter internet banking facility was restored.
5. When the petitioners verified the accounts of the Firm, they found that the 2nd respondent has committed gross irregularities and misappropriated funds. Thereupon, the petitioners issued a show-cause notice to the 2nd respondent. Though the 2nd respondent issued a reply to the show-cause notice, the reply did not contain any explanation to the allegations made against him. Therefore, the petitioners were convinced that continuance of the 2nd respondent in the Firm will be against the interest of the Firm. The petitioners therefore expelled the 2nd respondent from the Firm and the decision was communicated to the 2nd respondent as per Ext.P9.
6. The petitioners state that the 2nd respondent is no more a Partner of the Firm. However, the 2nd respondent prevailed upon the 1st respondent-Bank and the Bank has stopped internet banking facilities of the Current Account of the Partnership Firm. It is challenging the action of the Bank in stopping internet banking facilities that the petitioners are before this Court.
7. The counsel for the petitioner would contend that though the 2nd respondent had offered to contribute ₹20 lakhs to the Firm, the 2nd respondent did not pay the amount. He was cooperating with the business rivals. As per Clause 12 of the Partnership Deed, a Partner can be expelled after giving an opportunity to show-cause. After issuing a show- cause notice, the 2nd respondent was expelled from the Partnership and the said fact was communicated to the 1st respondent-Bank also. Therefore, the Bank ought not have acted upon the instructions of the 2nd respondent.
8. The petitioners' Firm has not committed any default. Therefore, the 1st respondent-Bank had no reason to stop internet banking transactions in respect of the Account. The 1st respondent-Bank ought to have noted that in view of Clause 11 of the Partnership Deed, no Partner could individually, without the concurrence of other Partners, seek stoppage of the Bank Account.
9. The learned counsel for the petitioners rel
