Sri Bhagavathi Textiles Ltd. Vs. M/s Lakshmi Textile Brokers & Ors.
EmailSuit for Recovery of money – Decree by trial court against Respondents described in the suit as partnership firm – Appeal – Contention by respondents that they did not constitute partnership – High Court remitting the matter to trial court holding that the relief had been directed against wrong parties . Held High Court need not have remitted the case to Trial Court but should have proceeded with the hearing of the appeal to find out if the Respondents who were liable to pay any money to the appellants – High Court accordingly directed to hear the matter.
Held –
1. The appellant had filed a suit for recovery of money against the respondents. Respondent No. 1 was described by the appellant as a partnership firm of which respondent Nos. 2 and 3 were partners. Incidentally, respondent No. 2 is the father of respondent No. 3.
2. The trial court decreed the suit for a sum of Rs. 1,03,061.22 plus interest thereon at the rate of 18 per cent per annum from 30th September, 1975 till the date of the decree and thereafter interest was to be at the rate of 12 per cent per annum till the date of realisation and proportionate costs.
3. The respondents had filed an appeal before the High Court. One of the contentions which was raised was that respondent No. 1 was not a partnership firm. The High Court by the Judgment under appeal came to the conclusion that respondent No. 1 was a trade name of the business which was being carried on by respondent No. 2. It then held that as the relief had been directed against wrong parties, the appellant herein should amend the suit. The appeal of the respondents was allowed and the case was remitted to the trial court for fresh disposal according to law.
4. We fail to understand the course adopted by the High Court. Even if respondent No. 1 was not a partnership firm but was a business owned by respondent No. 2, there was no reason why the High Court could not have proceeded with the hearing of the appeal in order to find out whether respondent No. 2 was liable to pay any money to the appellant herein. It was not the case of the defendants in the suit that any one other than respondent Nos. 2 and 3 had any interest in respondent No. 1. If respondent No. 1 was a duly constituted partnership firm., as was the case of the appellant herein, then respondent Nos 2 and 3 were stated to be its partners. Assuming the appellant was wrong, the case of the defendants themselves was that it is respondent No. 2. How was the sole proprietor of respondent No. 1. Even if this be the case, respondent No. 2 was a defendant in the suit which had been filed by the appellant and if the appellant had succeeded as it did before the trial court, a decree was liable to be passed against defendant No. 2. To put it differently, if the appellant had made out his case on merits, then defendant No. 2 was liable whether as a partner or as a sole proprietor of defendant No. 1. There was, therefore, no need for the High Court to set aside the trial court’s judgment and remit the case. The High Court, therefore, fell in error.
5. The High Court did not consider other contentions which were raised by the respondents herein. We, therefore, allow this appeal, set aside the judgment of the High Court and direct it to hear the appeal being A.S. No. 711/81 along with cross objections de novo. It will be open to the appellant herein to contend that apart from respondent No. 2, the other respondent, namely, respondents No. 3 is also liable.
6. Parties shall bear their own costs.
