Delhi High Court
M/S P. Kishanchand & Co. vs M/S Lalishah Khanna & Sons on 26 August, 2009
Author: Rajiv Sahai Endlaw
*IN THE HIGH COURT OF DELHI AT NEW DELHI
+E.A. No.456/2009 (of the Objector Mr. Rajesh Khanna u/O 21
R 50 CPC) along with E.A.No.455/2009 (for stay u/S 151) &
E.A. No.454/2009 (for exemption u/S 151) in Ex.P.
No.132/2005.
% Date of decision: 26.08.2009
M/S P. KISHANCHAND & CO. .... DECREE HOLDER
Through: None
Versus
M/S LALISHAH KHANNA & SONS ... JUDGMENT DEBTORS
Through: Mr. S.C. Singhal with Mr. S.R. Sharma,
Advocates for the Objector.
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1. Whether reporters of Local papers may
be allowed to see the judgment? Yes
2. To be referred to the reporter or not? Yes
3. Whether the judgment should be reported Yes
in the Digest?
RAJIV SAHAI ENDLAW, J.
*
1. Exemption allowed, subject to just exceptions.
2. Vide order dated 29th July, 2009 warrants of attachment were
issued in execution of the monies decree against M/s Lali Shah
Khanna & Sons, a partnership firm. These objections have been filed
by one Shri Rajesh Khanna on the ground that the warrants have
been issued with respect to his premises and goods. In the entire
objection petition it is nowhere stated that the objector is not the
partner of the judgment debtor firm. Mr. S.C. Singhal, Advocate
appearing for the objector on query admits that the objector is a
partner of the judgment debtor firm. He however contends that the
+E.A. No.456/2009 (of the Objector Mr. Rajesh Khanna u/O 21 R 50 CPC) along with
E.A.No.455/2009 (for stay u/S 151) & E.A. No.454/2009 (for exemption u/S 151) in Ex.P.
No.132/2005.
goods ordered to be attached are the personal property of the
objector and the decree cannot be executed thereagainst under
Order 21 Rule 50 of the CPC which is as under:-
"50. Execution of decree against firm. - (1) Where a decree has
been passed against a firm, execution may be granted -
(a) against any property of the partnership;
(b) against any person who has appeared in his own name
under rule 6 or rule 7 or Order 30 or who has admitted
on the pleadings that he is, or who has been adjudged to
be, a partner;
(c) against any person who has been individually served as a
partner with a summons and has failed to appear;
Provided that nothing in this sub-rule shall be deemed to limit
or otherwise affect the provisions of [section 30 of the Indian
Partnership Act, 1932 (9 of 1932)].
(2) Where the decree-holder claims to be entitled to cause
the decree to be executed against any person other than such a
person as is referred to in sub-rule (1), clauses (b) and (c), as
being a partner in the firm, he may apply to the Court which
passed the decree for leave, and where the liability is not
disputed, such Court may grant such leave, or, where such
liability is disputed, may order that the liability of such person
be tried and determined in any manner in which any issue in a
suit may be tried and determined.
(3) Where the liability of any person has been tried and
determined under sub-rule (2) the order made thereon shall
have the same force and be subject to the same conditions as
to appeal or otherwise as if it were a decree.
(4) Save as against any property of the partnership, a decree
against a firm shall not release, render liable or otherwise
affect any partner therein unless he has been served with a
summons to appear and answer.
(5) Nothing in this rule shall apply to a decree passed
against a Hindu Undivided Family by virtue of the provisions of
rule 10 of Order 30."
3. The partners of a firm have a unlimited liability to the creditors
of the firm. That is what distinguishes a partnership firm from a
limited company or now from the limited liabilities partnership (LLP)
permitted under the recent legislation. It is for this reason only that
sub-Rule 1(c) provides for execution of a decree against a firm also
against a person individually adjudicated as a partner or sued as a
partner along with the judgment debtor firm. Thus, once it is
admitted that the objector is a partner of the judgment debtor firm,
+E.A. No.456/2009 (of the Objector Mr. Rajesh Khanna u/O 21 R 50 CPC) along with
E.A.No.455/2009 (for stay u/S 151) & E.A. No.454/2009 (for exemption u/S 151) in Ex.P.
No.132/2005.
the decree against the judgment debtor firm is executable even
against the personal properties of the objector.
4. As far as the reference to Rule 50 (Supra) is concerned, the
same also does not negate the aforesaid general proposition. The
only purport thereof is that if from the decree it is not clear as to
whether the person against whom it is sought to be executed is a
partner or not, then the decree against such person cannot be
executed till the such adjudication is made by the court. However,
the said provision cannot come to the rescue of the objector who on
query from the court admits to be a partner of the judgment debtor
firm, though the said fact was sought to be obliquely concealed in
the objection petition.
5. The counsel for objector has contended that since the objector
does not fall in any of the categories mentioned in clauses (a) to (c)
of Sub Rule 1, for the decree to be executable against him, his
liability must be determined under Sub Rule (2) and procedure for
which adjudication is the same as a suit and till then, the decree
cannot be executed against him. He has thus urged for issuance of
notice of objection to the decree holder.
6. In my view, the only determination required under Sub Rule
(2) is whether the objector is a partner or not. The same does not
permit adjudication of any other liability, if a partner; in as much as
if the person referred to in Sub Rule (2) is determined to be a
partner, he would be liable for debt of the firm. To hold otherwise
would be to allow the decree to be reopened and which is not
permissible in law. If any support is needed for the proposition,
+E.A. No.456/2009 (of the Objector Mr. Rajesh Khanna u/O 21 R 50 CPC) along with
E.A.No.455/2009 (for stay u/S 151) & E.A. No.454/2009 (for exemption u/S 151) in Ex.P.
No.132/2005.
Gambhir Mal Pandiya Vs. J.K. Jute Mills Co. Ltd. AIR 1963 SC
243 can be referred to.
7. In the present case, that determination under Sub Rule (2) is
also not required since it is admitted that the objector is a partner.
8. In the circumstance, no merits are found in the objections and
the same are dismissed along with the other application.
RAJIV SAHAI ENDLAW
(JUDGE)
August 26th, 2009
pp
+E.A. No.456/2009 (of the Objector Mr. Rajesh Khanna u/O 21 R 50 CPC) along with
E.A.No.455/2009 (for stay u/S 151) & E.A. No.454/2009 (for exemption u/S 151) in Ex.P.
No.132/2005.
