“Enabling, Not Mandatory” – Supreme Court Clarifies That Sole-Proprietors May Be Sued in Their Personal Capacity Without Impleading the Trade Name
(Dogiparthi Venkata Satish v. Pilla Durga Prasad, 2025)

1. Introduction

Dogiparthi Venkata Satish v. Pilla Durga Prasad (2025 INSC 1046) presented the Supreme Court of India with a technical but recurring issue in civil procedure: Is it indispensable to sue a sole-proprietorship concern in its trade name under Order XXX Rule 10 of the Code of Civil Procedure, 1908 (CPC), or is suing the proprietor in his own name sufficient?
The dispute arose from a landlord-tenant relationship concerning commercial premises. After the lease expired, the landlord (appellant) sued for eviction. During the suit, the original defendant “Aditya Motors” (a proprietary concern) was substituted by its proprietor, Mr. Pilla Durga Prasad. The High Court of Andhra Pradesh, relying on Order XXX Rule 10, rejected the plaint for want of a cause of action, holding that the trade name should have remained on record. The Supreme Court reversed this ruling, reinstating the plaint and crystalising an important procedural principle.

2. Summary of the Judgment

• The Court granted leave, allowed the appeal, and set aside the High Court’s order that had rejected the plaint under Order VII Rule 11 CPC.
• Key holding: A sole-proprietorship concern is not a juristic person; impleading the proprietor in his individual capacity while describing him as representing the concern is legally adequate. Order XXX Rule 10 CPC merely enables a plaintiff to sue in the trade name; it does not mandate it.
• Consequently, rejection of the plaint was erroneous and hyper-technical; the Trial Court’s order refusing to reject the plaint was restored, and the suit was ordered to proceed on merits.

3. Detailed Analysis

3.1 Precedents Cited and Their Influence

1. Ashok Transport Agency v. Awadhesh Kumar (1998) 5 SCC 567
   • Clarified that a proprietary concern is merely a business name;
   • Order XXX Rule 10 is permissive; the real party in interest is the proprietor.
   The Supreme Court relied heavily on this decision to reiterate that suing the proprietor suffices.
2. Shankar Finance & Investments v. State of Andhra Pradesh (2008) 8 SCC 53
   • Underscored that in proceedings involving proprietary concerns, the proprietor remains the true litigant even if the complaint is filed in the trade name or by an authorised agent.
   This precedent reinforced the view that procedural representation should not eclipse substantive rights.

3.2 The Court’s Legal Reasoning

1. Nature of Proprietorship: The bench emphasised that a sole-proprietorship has no separate legal personality independent of its proprietor. Therefore, it cannot initiate legal proceedings on its own (cannot sue) but may be sued in its trade name by virtue of Order XXX Rule 10 CPC.

2. Interpretation of “Can be Sued” in Order XXX Rule 10: The word “can” (instead of “shall”) was decisive. It confers an option to the plaintiff; it does not impose an obligation. Once the proprietor is a party, the entire interest of the proprietary concern is inherently represented.

3. No Prejudice Test: The Court noted that no separate or third-party interest would be jeopardised by the omission of the trade name. Mr. Prasad had executed the lease personally; thus, the cause of action always lay against him.

4. Avoiding “Hyper-Technical” Dismissals: Order VII Rule 11 CPC is meant for plain cases where the plaint is fundamentally defective. The High Court’s view elevated form over substance and ran against the spirit of Order I Rule 9 CPC (“no suit shall be defeated by reason of misjoinder or non-joinder of parties”).

3.3 Potential Impact of the Judgment

• Simplification of Litigations against Sole-Proprietors: Plaintiffs can confidently sue the proprietor directly without fear that failure to add the trade name will be fatal.
• Reduction of Technical Defences: Defendants operating as sole-proprietors cannot succeed in having suits dismissed merely on the ground that their trade name was omitted.
• Guidance to Trial & Appellate Courts: The decision curbs excessive reliance on Order VII Rule 11 and promotes decision on merits.
• Commercial Transactions: Less procedural friction in enforcement of contracts (leases, supply agreements, cheques) involving sole-proprietors.
• Consistency with Arbitration & Consumer Forums: These fora often grapple with the same party-identity issue; the judgment provides persuasive authority beyond regular civil suits.

4. Complex Concepts Simplified

Sole-Proprietorship

A business carried on by one individual using a trade name (e.g., “Aditya Motors”). There is no separate legal entity; liabilities and assets belong personally to the proprietor.

Order XXX Rule 10 CPC

An enabling rule allowing a plaintiff to sue a person “carrying on business in a name or style other than his own” as if that name were a partnership firm. It does not prevent suing the individual himself.

Order VII Rule 11 CPC

Provides grounds on which a plaint can be rejected at the threshold—e.g., no cause of action, barred by law, insufficient court-fee. It is a drastic power exercised sparingly.

Order VI Rule 17 CPC (Amendment of Pleadings)

Allows parties to amend pleadings at any stage if necessary for determining the real question in controversy, subject to certain restrictions.

5. Conclusion

The Supreme Court’s decision in Dogiparthi Venkata Satish v. Pilla Durga Prasad achieves three significant ends: (i) it restates that a sole-proprietor is the real party in interest, (ii) it clarifies that Order XXX Rule 10 is permissive and not mandatory, and (iii) it discourages technical stratagems aimed at frustrating substantive adjudication. The ruling will serve as a practical precedent for litigants and courts alike, ensuring that justice is not lost in the labyrinth of procedural niceties. Going forward, litigators should focus less on nomenclature and more on the merits—a welcome stride toward a more efficient civil justice system.