RSA No.117 of 2009(O&M) 1
IN THE HIGH COURT OF PUNJAB & HARYANA, CHANDIGARH
R.S.A. No. 117 of 2009 (O&M)
Date of Decision:October 06, 2009
Achhru Ram ...........Appellant
Versus
Narinder Kumar Jain ..........Respondent
Coram: Hon'ble Mrs. Justice Sabina
Present: Mr.A.S.Syan, Advocate for the appellant.
**
Sabina, J.
Plaintiff filed a suit for recovery of Rs.2,09,515/- i.e.
Rs.1,94,500/- principal amount and Rs.15,015/- as interest @ 12% per
annum from the date of payment till 10.8.2003 along with pendente lite and
future interest @ 12% per annum till full and final payment on the
allegations that the defendant approached the plaintiff to deal with the sale
and purchase business of property jointly and plaintiff agreed for the same
and both of them started the joint business. The suit of the plaintiff was
dismissed by the Additional Civil Judge (Senior Division) Patiala vide
judgment and decree dated 22.2.2007. Aggrieved by the same, the plaintiff
filed an appeal which was dismissed by the Additional District Judge
(Adhoc) Patiala vide judgment and decree dated 5.5.2008. Hence, the
present appeal by the plaintiff-Achhru Ram.
The facts of the case, as noticed by the Additional District
RSA No.117 of 2009(O&M) 2
Judge in paras 2 to 5 of its judgment, read as under:-
” 2. Briefly stated the facts of the case as stated in the plaint are
that he and the defendant both agreed for dealing with the sale
purchase business of the property in different cities and States
through out India jointly, having its offices at Patiala and
Kurukshetra namely “Jain and Co” and “Jain Property Advisor”.
It is further averred that it was settled between them that the
plaintiff will come in the share at a consideration as per his
discretion and financially status. The defendant used to purchase
the properties and used to receive money from the plaintiff of his
share and himself used to sell the same and the plaintiff used to
deal with the business while sitting in the office being an old man
and used to pay the amount of his share only. They started their
business and dealt with so many properties, but in some cases, the
defendant failed to perform his part of the contract as they
purchased a plot for Rs.2.25 lacs situated at Kurukshetra and to
pay Rs.50,000/- as earnest money, the defendant received
Rs.12,500/- from him as 1/4th share i.e. Rs.25 paise share vide
receipt dated 9.1.2003. It is further averred in the plaint that
another land measuring 2 acres 7 kanals and 19 marlas situated at
Kurukshetra was purchased by them for a consideration of Rs.16
lacs per acre and to pay the earnest money, the defendant received
Rs.1,02,000/- from him as 1/17th share vide receipt dated
3.11.2002. Some other properties were also purchased by them
jointly. One property measuring 5-1/4 acres at Kurukshetra was
purchased for a consideration of Rs.24 lacs and to pay the earnest
RSA No.117 of 2009(O&M) 3money, the defendant received Rs.50,000/- from him as 5 paise
share on 29.12.2002. Another property i.e. a built house situated
at Kurukshetra was also purchased for a consideration of Rs.3 lacs
and to pay the earnest money, the defendant again received
Rs.30,000/- from him vide a receipt dated 28.1.2003. The
defendant agreed to execute all the agreements regarding these
properties in favour of the plaintiff, but to no effect. The plaintiff
as such received a sum of Rs.1,94,500/- from him. Neither he
executed any agreement nor he refunded the amount. Due to this
failure of the contract, the plaintiff is not interested to carry on
this business now. He requested the defendant to return the
amount along with interest, but to no effect. Hence, the suit.
3. In the written statement, the defendants took the preliminary
objections that the court has got no jurisdiction to entertain and
decide the suit; that the plaintiff has no cause of action; that the
plaintiff has not come to the court with clean hands and the suit of
the plaintiff is false and frivolous.
4. On merits, the defendant denied the joint business as alleged
by the plaintiff because the plaintiff is a stranger to him. He also
denied if there was any settlement between them. It is alleged that
the defendant used to purchase and sell the properties, but it is
denied that he has received any amount from the plaintiff and
receipt, if any, is forged one. Since there was no contract between
them, so the question of carrying on the same business in future,
does not arise. Remaining averments are also denied and a prayer
for dismissal of the suit has been prayed.
RSA No.117 of 2009(O&M) 4
5. Replication has also been filed by the plaintiff in which he
controverted the pleas taken in the written statement and
reiterated those made in the plaint.
On the pleadings of the parties, the following issues were
framed by the trial Court:-
“1. Whether the plaintiff is entitled to recovery of Rs.1,94,500/-
as principal amount?OPP
2. Whether the plaintiff is also entitled to interest, if so at what
rate?OPP
3. Whether this Court has no jurisdiction to try the present
suit?OPD
4. Whether the plaintiff has no cause of action to file the present
suit?OPD
5. Relief.”
After hearing the learned counsel for the appellant, I am of
the opinion that the present appeal deserves to be dismissed.
Plaintiff had filed a suit for recovery of the amount in
question on the allegations that the defendant had approached the plaintiff
to deal with the sale and purchase business of property jointly and they had
started a joint business. Both the plaintiff and defendant started their
business at Pataila and Kurukshetra. However, the defendant failed to
perform his part of the contract. Due to this reason, plaintiff asked the
defendant to return the amount of Rs.1,94,500/- along with interest. Learned
trial Court, after appreciating the evidence on record, held as under:-
“If both the firms were unregistered firms, no suit for recovery
was competent by one partner against the other as framed by the
RSA No.117 of 2009(O&M) 5plaintiff. Moreover, the receipts nowhere state that the sums
mentioned therein were paid by the plaintiff to the defendant or
that the defendant was liable to return those amounts to the
plaintiff with interest in case the transaction does not succeed
rather the remedy to the plaintiff lay under the provisions of the
Indian Partnership Act but the plaintiff has failed to pursue the
remedy available to him and as such I have no option but to hold
that the plaintiff is not entitled to recover the suit amount from the
defendant and also any amount as interest and the plaintiff has got
no cause of action to file the instant suit and as such findings on
issue nos. 1 and 2 are answered against the plaintiff while those
on issue no.4 in favour of the defendant.”
Section 69 of the Indian Partnership Act, 1932 reads as under:-
69.Effect of non-registration.-(1) No suit to enforce a right arising
from a contract or conferred by this Act shall be instituted in any
Court by or non behalf of any person suing as a partner in a firm
against the firm or any person alleged to be or to have been a
partner in the firm unless the firm is registered and the person
suing is or has been shown in the Register of Firm as a partner in
the firm.
(2) No suit to enforce a right arising from a contract shall be
instituted in any Court by or on behalf of a firm against any third
party unless the firm is registered and the persons suing are or
have been shown in the Register of Firms as partners in the firm.
(3) The provisions of sub-sections (1) and (2) shall apply also to a
claim of set-off or other proceeding to enforce a right arising from
RSA No.117 of 2009(O&M) 6a contract, but shall not affect.-
(a) the enforcement of any right to sue for the dissolution of a firm
or for accounts of a dissolved firm, or any right or power to
realise the property of a dissolved firm, or
(b)the powers of an official assignee, receiver or Court under the
Presidency-towns Insolvency Act, 1909, or the Provincial
Insolvency Act, 1920, to realise the property of an insolvent
partner .
(4) This section shall not apply,-
(a) to firms or to partners in firms which have no place of business
in [the territories to which this Act extends], or whose places of
business in the [the said territories] are situated in areas to which,
by notification under [Section 56], this Chapter does not apply,or
(b) to any suit or claim of set off not exceeding one hundred
rupees in value which, in the Presidency-towns, is not of a kind
specified in section 19 of the Presidency Small Cause Courts Act,
1882, or outside the Presidency-towns, is not of a kind specified
in the Second Schedule to the Provincial Small Cause Courts
Act,1887, or to any proceeding in execution or other proceeding
incidental to or arising from any such suit or claim”
Thus, since the suit had been filed by the plaintiff seeking
enforcement of a right arising from an unregistered firm, both the Courts
below rightly held that the suit of the plaintiff was not maintainable. Both
the Courts below, after appreciating the evidence on record, have given a
finding of fact that in the receipts Exhibit PW1/B and Exhibit PW2/B, there
was no mention that the amount had been received by the defendant from
RSA No.117 of 2009(O&M) 7the plaintiff.
No substantial question of law arises in this regular second
appeal which would warrant interference by this Court, Accordingly, this
appeal is dismissed.
(Sabina)
Judge
October 06, 2009
arya