RSA No. 4278 of 2010 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of decision:11.05.2011 RSA No. 4278 of 2010 Om Parkash ...Appellant Vs. Narinder Kumar Sharma and others ....Respondents CORAM: HON'BLE MR. JUSTICE L.N.MITTAL Present: Mr. Binderjit Singh, Advocate for the appellant. Mr. B.S.Sidhu, Advocate for the respondent No. 1/caveator/plaintiff. **** L.N.MITTAL, J (ORAL) By this common judgment, I am disposing of two appeals i.e. RSA No. 4278 of 2010 and RSA No. 4279 of 2010 both titled Om Parkash Versus Narinder Kumar Sharma and others as both these appeals have arisen out of single suit. However, two appeals have been preferred because there were two first appeals. Respondent No. 1-plaintiff-Narinder Kumar Sharma filed suit against M/s. Saree Sagar Textile (defendant No. 1), Om Prakash-defendant No. 2-appellant and the Branch Manager, Central Bank of India-defendant No. 3 as proforma defendant. The plaintiff alleged that he and defendant No. 2 and one Dev Raj constituted partnership firm-defendant No. 1 on 16.12.1977. All the three partners had 1/3rd share each in the firm. Dev Raj had died before filing of the suit. Plaintiff went from Bhatinda to Delhi to expand his own business. Business of defendant No. 1-partnership firm was left in the hands of defendant No. 2 on his assurance. However, plaintiff RSA No. 4278 of 2010 -2- later on learnt that defendant No. 2 had changed the name of defendant No. 1 as M/s. New Saree Sagar Textiles without dissolution of defendant No.1- firm. Accordingly, plaintiff sought dissolution of the firm-defendant No. 1 and distribution of its assets-movable and immovable (shop in which the business was carried on) and for rendition of accounts of the firm and also for permanent injunction. Defendant No. 2 contested the suit whereas defendants No. 1 and 3 were proceeded ex-parte. Defendant No. 2 denied that any firm was consituted by defendant No. 2 with the plaintiff. It was pleaded that they never worked as partners. Defendant No. 2 is running the firm as sole proprietor. Dev Raj and plaintiff have no concern with the same. Various other pleas were also raised. Learned Civil Judge (Junior Division), Bhatinda vide judgment and decree dated 12.10.2009 partly decreed the plaintiff's suit for partition of the disputed shop by holding plaintiff and defendant No. 2 to be having half share each therein and accordingly passed preliminary decree of partition. Defendant No. 2 was also restrained from alienating more than half share of the said shop. Relief of dissolution of firm-defendant No. 1 along with relief of rendition of accounts was declined. Both plaintiff and defendant No. 2 preferred separate first appeals. Learned District Judge, Bhatinda vide common judgment and decrees dated 04.09.2010 dismissed the first appeal preferred by defendant No. 2 and allowed the first appeal preferred by plaintiff and decreed the plaintiff's suit in toto. Feeling aggrieved, defendant No. 2 has preferred the instant two second appeals. RSA No. 4278 of 2010 -3- I have heard learned counsel for the parties and carefully examined the case files. As regards disputed shop, it has come on record that the said shop was purchased by plaintiff and defendant No. 2 jointly and they are owners of the said shop in equal shares. Counsel for the appellant, however, contended that the disputed shop was not property of partnership firm in terms of Section 14 of the Indian Partnership Act, 1932 (in short the "Act") and, therefore, partition of the disputed shop could not be ordered in the instant suit. The contention cannot be accepted. The plaintiff claimed distribution/partition of the disputed shop in the suit along with other reliefs. Of course, the plaintiff alleged the disputed shop also to be the asset of the partnership firm. However, it has been proved that plaintiff and defendant No. 2 are owners of the disputed shop in equal shares in their individual capacity. In view of this admitted factual position also, the disputed shop had to be partitioned between plaintiff and defendant No. 2 co-sharers and has, therefore, been rightly ordered to be partitioned by both the lower courts. There is no illegality in the finding of the courts below to this extent. Learned counsel for the appellant contended that the suit would be bad for multifariousness as different causes of action regarding dissolution of firm and rendition of accounts on the one hand and partition of individual property of plaintiff and defendant No. 2 on the other hand have been joined. The contention cannot be accepted. A suit is not necessarily liable to dismissal on this ground. In appropriate cases, if two or more causes of action can be joined in a single suit, the suit would still be maintainable. Secondly, in the instant case, as would be discussed RSA No. 4278 of 2010 -4- hereafter, suit regarding relief of dissolution of the firm and rendition of accounts thereof is being dismissed and for this reason also, the suit for partition of the disputed shop would not be bad for multifariousness. Moreover, Order II Rule 3 of the Code of Civil Procedure specifically provides that save as otherwise provided, a plaintiff may unite in the same suit several causes of action against the same defendant or the same defendants jointly; and any plaintiffs having causes of action in which they are jointly interested against the same defendant or the same defendants jointly may unite such causes of action in the same suit. In view of this specific provision also, the instant suit cannot be held to be bad for multifariousness. Accordingly, the aforesaid contention raised by counsel for the appellant has no merit. Learned counsel for the appellant vehemently contended that suit for dissolution of firm and rendition of accounts could not be decreed because legal representatives of 3rd partner Dev Raj have not been joined in the suit. Learned counsel for respondent No. 1-plaintiff, however, contended that under Section 42 of the Act, the firm stood dissolved on the death of Dev Raj-partner and in view of Section 47 of the Act, the surviving partners could continue with the business to wind up the affairs of the firm. Reference was also made to Order XXX Rule 4 of the Code of Civil Procedure (in short "CPC") to contend that the suit could be filed without joining legal representatives of Dev Raj-deceased partner. I have carefully examined the rival contentions. Under Section 42 of the Act, the firm stood dissolved on the death of Dev Raj-partner. Section 47 of the Act simply provides that after dissolution of the firm, the RSA No. 4278 of 2010 -5- authority of each partner to bind the firm, and other mutual rights and obligations of the partners, continue notwithstanding the dissolution, so far as may be necessary to wind up the affairs of the firm and to complete unfinished transactions but not otherwise. This provision nowhere stipulates that relief of dissolution of the firm and rendition of accounts thereof can be sought without impleading legal representatives of the deceased partner. Order XXX Rule 4 CPC is reproduced hereunder:- Right of suit on death of partner-(1) Notwithstanding anything contained in Section 45 of the Indian Contract Act, 1872 (IX of 1872) where two or more persons may sue or be sued in the name of a firm under the foregoing provisions and any of such persons dies, whether before the institution or during the pendency of any suit, it shall not be necessary to join the legal representative of the deceased as a party to the suit. (2) Nothing in sub-rule (1) shall limit or otherwise affect any right which the legal representative of the deceased may have- (a) to apply to be made a party to the suit, or (b) to enforce any claim against the survivor or survivors. A bare perusal of the aforesaid provision reveals that it does not relate to suit for dissolution of the partnership and for rendition of accounts thereof. This provision stipulates that suit may be filed by or against the firm without impleading legal representatives of the deceased partner. According to this provision, if one partner has died, still the firm may sue or RSA No. 4278 of 2010 -6- be sued in its own name. However, in the instant case, it is not a suit by or against the firm but it is a suit for dissolution of the partnership firm although the firm has also been impleaded as defendant No. 1. Order XXX Rule 4 CPC is not at all applicable to suit for dissolution of the partnership firm and rendition of accounts thereof. Even on principle, the contention raised by counsel for plaintiff- respondent No. 1 cannot be accepted because legal representatives of the deceased partner are necessary party to the suit because their rights and liabilities are also involved in dissolution of the firm and rendition of accounts thereof. In their absence, accounts of the firm cannot be rendered because their rights and liabilities would be effected and there would be nobody to protect them. Decree for dissolution of the firm and rendition of accounts thereof as granted by the lower appellate court is completely illegal and perverse and against the principles of natural justice because the same has been passed without affording opportunity of hearing to the legal representatives of the deceased partner Dev Raj who also had 1/3rd share in the assets and liabilities of the partnership in question. It is thus manifest that judgment and decree dated 04.09.2010 of the lower appellate court regarding dissolution of the parternship firm defendant No. 1 and for rendition of accounts thereof are patently perverse, illegal and unsustainable because of non-joinder of necessary parties i.e. legal representatives of deceased partner-Dev Raj. Substantial question of law to this effect arises for adjudication in these two appeals and the same is accordingly answered in favour of the appellant. For the reasons aforesaid, these two appeals are allowed partly and judgment and decree dated 04.09.2010 of the lower appellate court are RSA No. 4278 of 2010 -7- set aside and judgment and decree of the trial court are restored. (L.N.MITTAL) JUDGE May 11, 2011 divyanshi