M/S.Anil Bearings vs M/S State Motors & Another
2010 Latest Caselaw 967 Del

                                       REPORTED
*      IN THE HIGH COURT OF DELHI AT NEW DELHI



+             RFA 19/2010 and CM No.773/2010 (stay)

       M/S. ANIL BEARINGS                      ..... Appellant
                      Through: Mr. Rajesh Gogna and Mr. Sanjay
                               Jha, Advocates

                     versus

       M/S. STATE MOTORS & ANR                        ..... Respondents
                            Through: Mr. Suresh Goyal, Advocate
       CORAM:
       HON'BLE MS. JUSTICE REVA KHETRAPAL
1.     Whether reporters of local papers may be allowed
       to see the judgment?
2.     To be referred to the Reporter or not?
3.     Whether judgment should be reported in Digest?

                        ORDER

%                       19.02.2010

:      REVA KHETRAPAL, J. (Oral)

1.     Admit.

2. Since a very short point is involved, with the consent of the

parties the appeal is taken up for final hearing.

3. The appellant in this appeal seeks to assail the impugned

judgment dated 19.11.2009 passed by the learned Additional District

Judge dismissing the suit of the plaintiff as not maintainable on the

ground that the suit is filed by the proprietorship concern, which is not a

legal entity.

4. Admittedly, in the suit, the name and description of the plaintiff

is given in the following manner:

M/s. Anil Bearings, 633/4, Hamilton Road, Kashmiri Gate, Delhi - 110006 Through its proprietor Shri Anil Thapar

5. The appellant in his suit claimed recovery of Rs.4,52,364/-

(Rupees Four Lakhs Fifty Two Thousand Three Hundred and Sixty

Four only), which included Rs.3,82,402/- towards the principal and

Rs.69,962/- towards the interest. The plaint was signed and verified by

Shri Anil Thapar. Apart from signing and verifying the plaint, Shri Anil

Thapar also furnished his affidavit in support of the plaint in the

capacity of proprietor of M/s. Anil Bearings. He also executed and

signed vakalatnama in favour of the counsel for the plaintiff.

6. It may be pertinently mentioned at this juncture that the suit for

recovery of the aforesaid amount was filed on the basis of goods

supplied by the plaintiff to the defendant against different invoices, as

set out in paragraph 7 of the plaint. Pertinently also, in the written

statement filed by him, the defendant admitted all the invoices as

mentioned in paragraph 7 of the plaint against which goods were

supplied to it. Not only this, the defendant also admitted the 'C' Forms,

which it had issued to the plaintiff against the aforesaid goods supplied

to it.

7. On 6th October, 2008, the following issues were framed by the

learned trial Judge before the matter was adjourned for the plaintiff's

evidence to 19.11.2008:-

"(i) Whether the plaintiff is entitled to recover a sum of Rs.4,52,364/- along with interest and pendentilite in future @ 18% per annum and cost? OPP.

(ii) Whether the suit is not maintainable in the present form? OPD.

(iii) Whether this court has no jurisdiction to try and entertain the present suit? OPD.

(iv) Relief."

8. So far as the counter-claim was concerned, the following issues

were framed:-

"(i) Whether the defendant is entitled to a sum of Rs.4,17,944/- along with pendentilite and future interest @ 18% per annum? OPD.

(ii) Relief."

9. The appellant states that at the time of framing of issues the trial

court did not declare any of the issues as a preliminary issue, and as a

matter of fact set down the case for recording of the plaintiff's evidence.

On the date fixed for the plaintiff's evidence, i.e., on 19.11.2008, the

plaintiff's witness along with his counsel was present in the court and

the plaintiff filed his affidavit by way of evidence, an advance copy of

which had been supplied to the defendant prior to the date of hearing.

Thereafter, the matter was adjourned to 24th February, 2009 for the

examination of the plaintiff and thence to 9th July, 2009, 21st August,

2009 and 19th November, 2009. On the last date, i.e., on 19th November,

2009, as the plaintiff was in the process of tendering his affidavit in

evidence, the counsel for the defendant raised an objection to the

maintainability of the suit, relying upon the provisions of Order XXX

Rule 10 of the Code of Civil Procedure, which resulted in the trial court

treating Issue No.(ii) as a preliminary issue and dismissing the suit as

not maintainable, adjourning the case to 21st January, 2010 for the

evidence of the defendant on the counter-claim.

10. Aggrieved by the impugned judgment and order dated 19th

November, 2009, the present appeal has been preferred by the appellant.

Arguments were advanced by Mr. Rajesh Gogna, the counsel for the

appellant and Mr. Suresh Goyal, the counsel for the respondents.

11. The principal contention of Mr. Rajesh Gogna on behalf of the

appellant is that the trial court failed to appreciate that the description of

the party had been succinctly delineated in the plaint and there was

enough material on the record to conclude that the plaint had been filed

by Shri Anil Thapar, as the proprietor of M/s. Anil Bearings. He further

contended that the Court had taken a hyper-technical approach in

dismissing the suit, ignoring the fact that the plaint was signed and

verified by Shri Anil Thapar, and the defendant themselves had

addressed their legal notice dated 30th August, 2007 to M/s. Anil

Bearings and not to Shri Anil Thapar in his individual name. In such

circumstances, it was incumbent upon the trial court to have read the

plaint as a whole rather than looking at the memo of parties to conclude

that the plaint had been filed by a non-legal entity. It was also

contended that if the Court considered that the suit as framed was not

maintainable, it should not have dismissed the suit on this hyper-

technical ground, but should have given an opportunity to the appellant

to amend the memo of parties so as to mention the name of the

proprietor (Anil Thapar) before the name of the proprietorship concern,

"M/s. Anil Bearings".

12. Reliance was placed by the learned counsel for the appellant on a

judgment of the Bombay High Court in Municipal Council, Tiroda vs.

K. Ravindra & Company reported in 2003 (2) Civil Court Cases 578, in

support of his contention that in cases of bonafide error, where the

mistake has been made not for any ulterior purpose, rectification of the

memo of parties ought to be permitted by the Court rather than adopting

the course of rejecting the plaint.

13. Reference was also made by the learned counsel for the appellant

to a judgment of this Court in Chunnil Lal vs. RPG Home Finance

Pvt. Ltd. 2007 (1) R.A.J. 13 (Del), wherein it was observed as follows:

(R.A.J., Page-15, paragraph 4)

"4. In the Written Statement the Respondent has contended that the Petition is not maintainable as C.L. Construction Company is a sole proprietorship concern and is not a legal entity. A perusal of the Memorandum of Parties will disclose that the Petitioner has been arrayed as C.L. Construction Company through its proprietor Shri Chunni Lal who has signed the application and the Affidavit in support thereof. In this affidavit Shri Chunnil Lal has stated that he is the Plaintiff. While the array of parties ought to have been fashioned as Shri Chunni Lal, sole proprietor of C.L. Construction Company, this hyper-technical objection deserves to be overruled. Order 30 Rule 10 specifically permits that a person carrying on business in a name or style other than his own may be sued in such name or style as if it were a firm name.

Thereafter the Petitioner can require the Defendant so arrayed to disclose the name and details of the owner. This is because Order XXX is made applicable to such cases."

14. In rebuttal, the contention of the learned counsel for the

respondent was that the suit, having been filed by a proprietorship

concern, which was not a separate legal entity, clearly fell foul of the

provisions of Order XXX Rule 10 CPC, which read as under:

"10. Suit against person carrying on business in name other than his own.- Any person carrying on business in a name or style other than his own name, or a Hindu undivided family carrying on business under any name, may be sued in such name or style as if it were a firm name, and, in so far as the nature of such case permits, all rules under this Order shall apply accordingly."

15. Having considered the rival contentions of the parties, I am of the

view that the learned trial court adopted a hyper-technical approach in

dismissing the suit, ignoring the fact that at the most it was a case of

mis-description of the parties, as was clear from a reading of the plaint

in its entirety. Thus, in paragraph 1 of the plaint, it was clearly

mentioned that the plaintiff was a proprietorship establishment and Shri

Anil Thapar was the sole proprietor of the plaintiff establishment,

having its office at 633/4, Hamilton Road, Kashmiri Gate, Delhi -

110006. In paragraph 2 of the plaint, it was elaborated that the suit was

being filed by Shri Anil Thapar, who was the proprietor and was well

conversant with the facts and circumstances of the case and competent

to file, sign and verify the suit and to do all other necessary acts for

pursuing the case against the defendants. Then again, in consonance

with the provisions of Order VI Rules 14 and 15 CPC, the plaint was

signed and verified by Shri Anil Thapar as plaintiff and Shri Anil

Thapar had also furnished his affidavit in support of the plaint. The

learned trial court also, in my view, altogether lost sight of the fact that

Order XXX Rule 10 CPC is an enabling provision, inasmuch as it

allows the plaintiff to sue a person carrying on a business in a name or

style other than his own in such name or style as if it were a firm name,

as is apparent from a bare perusal of the provisions thereof. The said

provision far from coming to the assistance of the respondent-

defendant, comes to the aid of the appellant-plaintiff.

16. No doubt, the settled legal position is that since a firm is not a

legal entity, the privilege of suing in the name of a firm is available only

to those persons who are partners in a firm and are doing business as

such. The present was, therefore, a case where the description of the

plaintiff by a firm name was a mis-description, but such error in law, not

being the description of a non-existent person, is not one which cannot

be corrected. The learned trial court ought, therefore, to have directed

the plaintiff to amend the memo of parties to enable a proper description

of the plaintiff and proceeded to determine the real question in issue

between the parties.

17. In Jai Jai Ram Manohar Lal vs. National Building Material

Supply Gurgaon (1969) 1 SCC 869 where the Supreme Court had an

occasion to consider a somewhat similar question, inasmuch as the suit

instead of being filed in the name of the plaintiff as manager of the

Hindu Undivided Family to which the business belonged, was filed in

the business name "Jai Jai Ram Manohar Lal". An amendment

application was filed by the plaintiff which was rejected by the High

Court on the ground that there was no averment to the effect that the

mis-description was on account of a bonafide mistake. The Supreme

Court, on appeal, held that the order passed by the High Court could not

be sustained, and laid down the following oft-quoted dicta:-

"5. ..................................Rules of procedure are intended to be a handmaid to the administration of justice. A party cannot be refused just relief merely because of some mistake, negligence, inadvertence or even infraction of the rules of procedure. The Court always gives leave to amend the pleading of a party, unless it is satisfied that the party applying, was acting mala fide, or that by his blunder, he had caused injury to his opponent which may not be compensated for by an order of costs. However negligent or careless may have been the first omission, and, however late the proposed amendment, the amendment may be allowed if it can be made without injustice to the other side...................................................."

18. In view of the aforesaid, the judgment and order dated

19.11.2009 pertaining to the maintainability of the suit are set aside and

the suit is restored to the file of the learned Additional District Judge to

be dealt with in accordance with law with the direction to the plaintiff to

amend the plaint latest within six weeks from the date of the passing of

this order. Parties shall appear before the learned District Judge on 5 th

April, 2010, when the learned District Judge shall proceed to decide the

remaining issues on merits, after taking on record the amended memo of

parties and the amended plaint.

RFA 19/2010 and CM No.773/2010 stand disposed of

accordingly.

REVA KHETRAPAL,J FEBRUARY 19, 2010 km