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Case Number

Appeal No. 308 of 1966

Advocates

For the Appellant: P.V.R. Sarma, Advocate.
For the Respondent: M.V. Ramana Reddy for R. Sundar Ram Reddy, Advocates.

Judges

Parthasarathi, J.

Acts

Indian Partnership Act, the requirements of Section 69(2)
section 69(2) of the Indian Partnership Act.
provisions of sub-section (2) of Section 69
provisions of Order 30, Rule 1 of the CPC.
SECTION 31 MOTOR VEHICLES ACT
section 69(2) of the Partnership Act,
provision of the Motor Vehicles Act
sub-section (2) of section 69.11.
Rule 1 of Order 30 of the CPC
sub-section (2) of section 69
Order 41, Rule 27 of the CPC.
Order 30 Rule 1 of the CPC.
provisions of section 69(2)
Rule 1 of the Order 30
provisions of Order 30
Indian Partnership Act
sub-section (2) of S. 69
Order 30, Rule 1,
Sub-rule (2)

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Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

The plaintiff is a firm styled "Sri Venkateswara Finance Corporation", represented in the suit by three persons described as managing partners. The defendants are father and son. The plaintiff's case is that the 1st defendant is the hirer and the 2nd defendant is the guarantor under a hire purchase agreement requiring 12 monthly instalments from 29-1-1963. The plaintiff alleges default by the defendants, who paid only two small amounts (Rs. 500 and Rs. 318), and that the plaintiff had to pay an insurance premium of Rs. 577.50 because of the defendants' omission; it sought reimbursement of that premium and recovery of other sums. The defendants failed to satisfy liability on demand and the suit was filed.

The defendants challenged the maintainability of the suit, contending that the partnership was not properly registered under the Indian Partnership Act and that the names of the partners suing were not entered in the register of firms. They also denied that the transaction was a hire purchase agreement (asserting it was a loan), claimed ownership of the motor vehicles, alleged there was no valid transfer of title to the plaintiff-firm, and claimed a payment of Rs. 2,000 was not credited. The trial court overruled the defendants' defences and granted a decree to the plaintiff. The defendants appealed.

Legal Issues Presented

Whether the suit brought by the firm is maintainable under section 69(2) of the Indian Partnership Act where the plaintiffs did not produce evidence showing the names of the partners suing as entered in the register of firms.
Whether, in the circumstances of this case, proof of registration of the firm (by certificate or official intimation) suffices to maintain the suit—i.e., the interplay between Section 69(2) of the Partnership Act and Order 30, Rule 1 of the CPC.
Whether the transaction between the parties was a hire purchase agreement enforceable by the plaintiff, or merely a loan with the defendants retaining ownership.
Whether the hire purchase agreement (and related acts, such as delivery/plying/insurance) is illegal by reason of non-compliance with Section 31 of the Motor Vehicles Act (failure to notify transfer of ownership) or otherwise.
Whether the amount advanced by the plaintiff is Rs. 10,450 (or Rs. 10,400 / Rs. 9,500 as contested) and whether admitted facts in pleadings decide that controversy.

Arguments of the Parties

Appellants' (Defendants') Arguments

The partnership was not registered properly under the Indian Partnership Act and the names of the partners who are suing were not entered in the certificate of registration (invoking section 69(2)).
The transaction was not a hire purchase agreement but only a loan; the motor vehicles belonged to the defendants and there was no valid transfer of ownership to the plaintiff.
The hire purchase agreement was illegal (including submissions based on section 31 of the Motor Vehicles Act concerning notification of transfers).
They had made a payment of Rs. 2,000 which was not credited.
The amount actually lent was only Rs. 9,500 and not the higher sum claimed by the plaintiff.

Respondent's (Plaintiff's) Arguments

The firm was registered; the plaintiff relied on Ex. A-1 described as "a certified copy of acknowledgment of the registration of the firm" and on the hire purchase agreement which described P. R. C. Reddi as managing partner.
Under Order 30, Rule 1 of the CPC, a firm can sue in its own name; therefore proof of registration of the firm suffices to maintain the action without a separate production of the register entry showing the names of the partners suing.
The hire purchase agreement and accompanying facts (including admissions in the written statement and the reply notice) support the plaintiff's right to recover and reimbursement of insurance premium.
There was an admission in paragraph (5) of the written statement that Rs. 10,450 was lent, undermining the defendants' contention on the amount.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Firm Kapurchand Bhagaii v. Laxman Trimbak, AIR 1952 Nag 57	Register of firms is a public document; oral testimony (secondary evidence) is not admissible to prove registration — entry must be proved by production of a copy of the register entry.	The court treated the Nagpur decision as distinguishable and noted that an observation in that case (that plaintiff not entitled to succeed due to lack of proof of managing partner's name in register) was obiter dictum because the primary ground was inadmissibility of oral evidence.
Basant Lal v. Union of India, AIR 1965 Pat 426	Held in the appellate court that suit was not maintainable for lack of proof that the names of the plaintiffs were entered in the register; additional evidence was not admitted.	The court observed this decision's relevant observations were also not direct pronouncements on the point; some dicta implied the names might be proved by evidence other than an extract from the register, and the present court did not treat Basant Lal as determinative against maintenance here.
Hansraj v. G. N. Champalal, 66 Cal WN 262	Reviewed authorities and expressed the view that Section 69(2) is stringent — persons suing must prove names are shown in the register of firms.	The opinion considered the Calcutta review but distinguished facts and concluded that the strict view in some decisions should not control where Order 30 procedures and admissions operate; the present case raised different considerations.
Sardar Singer Singh v. Sikri Brothers, AIR 1944 Oudh 37	When a suit is brought in the firm's name, the firm is the real plaintiff and the mere addition of the name of a partner through whom the suit is brought is form not substance (redundant).	The court regarded this approach as supporting the proposition that a suit in the firm's name may be maintained on proof of registration and that addition of partner names may be disregarded as redundant.
Ram Kumar Ram Chandra v. Dominion of India, AIR 1952 All 695	Where the plaint describes the firm and shows it is suing through a partner, the suit is substantially by the firm; the addition of the partner's name is redundant; proof of registration of the firm suffices.	This decision was treated as directly supportive of the respondent's position and the court considered its reasoning "unexceptionable", following its principles to hold the suit maintainable on proof of registration.
Firm Buta Mai v. Chaman Lal, AIR 1964 Punj 270	Held that all partners must be deemed persons suing and that omission of a partner's name from the register may render the suit incompetent; a broader construction of s.69(2).	The court found this ratio too wide and not consonant with the language of Section 69(2); it distinguished and did not follow the expansive construction applied by the Punjab High Court.
Firm Sunkari Yadgiri & Co. v. Union of India, AIR 1954 Hyd 172	Production of a certificate showing registration of a firm was held sufficient where the suit was instituted in the name of the firm without further description of partners.	The court cited this as supportive of the proposition that proof of registration can suffice to maintain a suit brought in the firm's name.
Murthyasami Gounder v. Thulasi Ammal, (1970) 1 Mad LJ 263	Interpreted Section 31 of the Motor Vehicles Act to mean that failure to notify change of ownership does not render the transfer itself illegal; non-notification attracts penalties but does not invalidate the transfer.	The court relied on this construction to reject the defendants' contention that the transfer (or delivery/insurance) was illegal for want of notification and to hold that plying and insuring vehicles under the hire purchase agreement was not illegal.

Court's Reasoning and Analysis

The court proceeded in two complementary strands of analysis: procedural/issue-focused reasoning and a merits-oriented statutory interpretation.

Procedural/issue-focused reasoning: The court emphasized that the defendants had pleaded that the names of the persons suing were not in the registration certificate, but neither party attempted to prove the contents of the registration certificate at trial. The defendants did not seek an issue to be framed specifically to cover the plea about the partners' names and did not press the matter at trial. Given that omission, the court held it was open to serious doubt whether the defendants could raise the point on appeal: the lower court's issue framing had confined the controversy, and the defendants' acquiescence in that narrower scope meant the plaintiff was not put on notice to prove the partners' names from the register. The court therefore concluded there was no basis for dismissing the suit on this procedural ground.

Merits and statutory construction: The court accepted that Section 69(2) contains mandatory language, but held that when a court is asked to dismiss an action for incompetency on that ground, it must consider the defendant's omission to adduce evidence or to force the point at trial. Beyond the procedural bar, the court dealt with the question on the merits.

On interpretation, the court reconciled Section 69(2) with Order 30 of the Civil Procedure Code (CPC). Order 30 Rule 1 permits suits to be filed in the name of a firm and contemplates procedures by which the names and particulars of partners at the time the cause of action accrued may be disclosed on application to the court. The court reasoned that the phrase "persons suing" in Section 69(2) must be read in the light of Order 30: the conjunction "and" in the section should be construed in a disjunctive sense (i.e., read as "or") so that the latter part of sub-section (2) is triggered where disclosure is called for under Order 30. Thus, the requirement to show names in the register was not to be treated as an absolute prerequisite in every instance where a firm sues; proof of registration and the procedural mechanisms of Order 30 are alternative means of satisfying the legislative intent.

The court reviewed authorities on both sides: those that supported a strict reading (Nagpur, Patna, Punjab dicta) and those that supported a more flexible approach (Allahabad, Oudh, Hyderabad). It found the Nagpur and Patna observations on the necessity of producing the register entry to be obiter in part and considered the Punjab decision's construction too wide. The court regarded the reasoning of the Allahabad and Oudh courts as directly applicable and unexceptionable.

Applying the above, the court found:

Ex. A-1 constituted proof of registration (described as a certified copy of acknowledgment of registration), and the hire purchase agreement itself described P. R. C. Reddi as managing partner — a fact admitted by the defendants in the reply notice and in the written statement.
The plaintiff was therefore able to satisfy the requirement of Section 69(2) in the circumstances of this case, and the addition of the other two managing partners' names in the plaint was inconsequential/redundant.
The defendants' contention that the hire purchase agreement was illegal (including an alleged contravention of Section 31 of the Motor Vehicles Act) was rejected: the court construed Section 31 as requiring notification of transfer to authorities and imposing penalties for omission but not rendering the transfer itself invalid. The court relied on a Madras High Court decision construing Section 31 to the same effect.
The defendants' challenge on the quantum (that only Rs. 9,500 was lent) was undermined by an admission in the written statement that Rs. 10,450 was lent; accordingly no weight could be given to documentary evidence to the contrary.

The court concluded that the trial court correctly overruled the defendants' defences and granted the decree to the plaintiff.

Holding and Implications

Holding: The appeal is dismissed (the trial court's decree in favour of the plaintiff is affirmed) and the appeal was dismissed with costs.

Implications:

Direct effect: The decree in favour of Sri Venkateswara Finance Corporation stands; the defendants' appeal fails and they are ordered to pay costs.
On the legal questions addressed, the court held that proof of registration of a firm (in conjunction with the procedural framework of Order 30, CPC) can suffice to maintain a suit brought in the firm's name even where the register entry showing the names of the partners suing is not produced; the court construed the conjunction "and" in Section 69(2) in a disjunctive sense so as to harmonize Section 69(2) with Order 30. The court rejected the submission that failure to notify transfer under Section 31 of the Motor Vehicles Act renders a transfer illegal.
The court distinguished earlier authorities that favored a stricter rule and treated some observations in those cases as obiter dictum; it followed the line of cases (e.g., Allahabad, Oudh, Hyderabad) that the firm's registration and procedural safeguards under Order 30 may be sufficient.
No statement in this opinion purports to lay down an expansive new principle beyond the interpretation adopted here; the decision resolves the dispute between the parties on the facts and statutory construction presented in the opinion.

This summary is prepared exclusively from the provided opinion and does not add information not contained in that text.

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M.J Velu Mudaliar And Another v. Sri Venkateswara Finance Corpn. And Others

1. This appeal arises out of an action for recovery of money on foot of a hire purchase agreement entered into by the defendants, who are father and son. The plaintiff is a firm styled “Sri Venkateswara Finance Corporation.’ and is represented by three persons described as managing partners. The case of the paintiff is that the 1st defendant is the hirer and his son, the 2nd defendant is the guarantor, who are liable to make payments in 12 monthly instalments from 29-1-1963 and that there was default on the part of the defendants who paid only two paltry sums of Rupees 500/- and Rs. 318/- and that the plaintiff had to pay insurance premium to the tune of Rs. 577/50 Ps. because of the omission of the defendants. Reimbursement is sought in respect of the insurance premium. The defendants failed to satisfy the liability on demand and hence the suit was filed.

2. The defendants challenged the maintainability of the suit on the ground that the partnership was not registered under the Indian Partnership Act and that the names of the partners who are suing, were not entered as such in the certificate of registration. They deny that the transaction is one of hire purchase. According to them, the transaction was only one of loan. They pleaded that the motor vehicles belonged to them and that there could be no question of any hire purchase agreement. They stated that there was no valid transfer of ownership of the buses to the plaintiff-firm and the agreement was illegal. They claimed to have made a payment of Rs. 2,000/- for which no credit was given. The trial court overruled the defences and granted a decree to the plaintiff and this appeal is preferred by the defendants.

3. The first contention urged by the learned counsel for the appellants is based on section 69(2) of the Indian Partnership Act. It was pleaded by the defendants that the registration of the firm does not show that the plaintiffs 1 to 3 are partners and it is not also shown whether there were any other partners. The registration of the firm is clearly proved by Ex. A-1. It is described as “a certified copy of acknowledgment of the registration of the firm.” It is not the registration certificate but it is an official intimation that Sri Venkateswara Finance Corporation was registered as a firm on an application made to the Registrar of firms.

4. There was a categorical plea that the names of the persons suing as partners were not found in the certificate of registration. But, neither party to the suit made any attempt to prove the contents of the certificate of registration. The issue framed in the lower Court was focussed only on the controversy in respect of the firm's registration. The defendants did not ask for an issue to be framed to cover their plea that the names of the partners suing on behalf of the firm were not found in the register. It appears to me that the defendants did not press their plea at the trial though in the argument reference was made to it.

5. There was a lengthy argument in this appeal on behalf of the defendants that the requirements of S. 69(2) were not satisfied and the suit was not competent. The terms in which the issue was cast and the range of the controversy in the lower Court suggest that the defendants were not keen on pressing this aspect at the trial, even if they did not formally abandon the plea. It is open to grave doubt whether it is permissible for the defendants to agitate the question in this appeal having regard to their omission to ask for the settlement of the issue in express terms. Had the defendants urged that the issue should have been so worded as to make the entry of the names of the partners in the certificate of registration a provable fact, the position would have been different. Then the plaintiff firm would have been duly alerted that the proof of the contents of the registration certificate was a live or debated issue. In the face of an acquiescence on the part of the defendants in the limited scope of issue No. 2 it is not open to them to canvass the question in this appeal on the ground that the plaintiff-firm failed to prove the fact in controversy.

6. It is however, submitted by the learned Counsel for the appellants that section 69(2) makes it incumbent on the plaintiff to satisfy the two conditions mentioned therein, and that the suit must be held to be incompetent if the mandatory provisions are not proved to have been satisfied. The argument advanced by the appellants is that no act of the defendants can make a suit good or maintainable, which at its inception is bad. The consent of the defendants or their omission to raise a plea cannot enable the court to make a decree in favour of the plaintiff unless the mandatory terms of the section are satisfied. It is true that an unregistered firm cannot maintain an action arising from a contract on behalf of a firm. Similarly, sub-section (2) enacts that the persons suing should have been shown in the register of firms as partners in the firm. The requirement contemplated by Section 69(2) is mandatory. But, when a Court is called upon to dismiss an action on the ground that it is not competent as the pre-requisite conditions are unsatisfied, the Court cannot fail to take into account the omission of a defendant to adduce evidence bearing on the question. The position in the instant case is that the defendants were merely content with taking a plea in the written statement but did not join issue with the plaintiff in respect of the plea; nor did the defendants press for the inclusion of the plea in the issue so as to focus the attention of the Court and of the plaintiff on the controversy. The defendants did not call upon the plaintiff to disclose the names of the partners. In the circumstances, there is no basis for the dismissal of the suit on the ground that the requirements of Section 69(2) are not complied with.

7. Even so, as the question has been argued at great length, I shall deal with it on merits. Learned Counsel for the appellants relied upon the decision in Firm Kapurchand Bhagaii v. Laxman Trimbak, AIR 1952 Nag 57 in support of his contention that the suit is not maintainable. The facts in that case were that a suit was brought for recovery of money on the allegation that the plaintiff was a registered firm and the managing partner was Umedmal. Both the allegations were denied by the defendants. One of the partners was examined as P.W 1 and he gave oral testimony about the registration of the firm and of hid status as the managing partner. The main question decided by the Nagpur High Court was, whether the oral testimony of P.W 1 was admissible as secondary evidence in proof of the fact of registration. It was held that it was not admissible. The register of firms was a puplic document and the fact of registration was held capable of being proved only by production of a copy of the entry in the register of firms. The application for the admission of additional evidence was dismissed on the ground that no case for the reception of additional evidence was made out. The dismissal of the suit by the High Court in revision was based on the ground that the registration of the firm was approved The learned Judge, who decided the revision petition then made an observation that the plaintiff was not entitled to succeed even if the additional evidence was admitted because there was no proof of the entry of the name of the managing partner in the register of firms. This observation was clearly an obiter dictum and did not arise for consideration because of the rejection of the additional evidence and dismissal of the suit on the ground of the insufficiency and inadmissibility of the oral testimony to prove the registration of the firm.

8. My attention was next drawn to Basant Lal Union of India, AIR 1965 Pat 426, In that case in the first appellate Court, documents were tendered by way of additional evidence to prove the fact of registration of the firm. No order, however, was passed on the application under Order 41, Rule 27 of the CPC. The appellate Court held that the suit was not maintainable for lack of proof that the names of the plaintiffs filing the suit were entered in the register of firms. The dismissal of the suit by the first appellate Court was upheld in second appeal by the Patna High Court. The view taken in second appeal was that there is no ground for the admission of additional evidence. The learned Judge that decided the appeal, however, observed that the registration certificate did not show that the names of the plaintiffs were entered in the register as partners of the firm. This decision also cannot be regarded as a direct pronouncement because the observation was no more than an obiter dictum. It is however pertinent to note that certain dicta in this case implied that the fact that the names of the plaintiffs were entered in the register of firms was capable of being proved by evidence other than an extract from the register of firms.

9. In Hansraj v. G.N Champa lal, 66 Cal WN 262 there was an elaborate review by Chatteriee, J. of the Calcutta High Court of several authorities bearing on the question. The view was expressed that the provisions of S. 69(2) are very stringent and a suit on behalf of a firm by certain persons may be validly instituted provided the firm is registered and the persons suing prove that their names were shown in the register of firms as partners. The learned Judge distinguished, among other, the decisions in Sardar Singer Singh v. Sikri Brother, AIR 1944 Oudh 37 and Ram Kumar Ram Chandra v. Dominion of India, AIR 1952 All 695. The facts were that there were two partners in a firm of whom one died. The partnership was registered and the names of the two partners appeared in the register of firms. One of the partners died and his heirs were not brought on the said register The partnership was said to have continued its business with the heirs of the deceased partner. The question whether the suit brought by the surviving partner and the heirs of the deceased partner was maintainable. The stand taken by the plaintiffs was that the heirs of the deceased partner had been taken in as partners. The dismissal of the suit was upheld on the ground that the heirs of the deceased partner having become partners by reason of the partnership agreement the omission of addition of their names in the register of firms brought the case within the mischief of sub-section (2) of section 69. It is not easy to accept the premises on which the learned Judge's decision rested, namely, that the firm though consisting of two partners, continued to be in existence after the death of one of the partners. The names of the two persons, who constituted the firm at the inception were shown in the register of firms; and this fact was not in dispute. Nor was there any controversy that the persons suing as the heirs of the deceased partner were his heirs. In the circumstances, the application of the bar under S. 69(2) does not appear to be in consonance with the intendment of the provision. The case dealt with by the Calcutta High Court related to the legal representatives of the deceased partner whose name was found in the register of firms. Whether the case attracts the provisions of sub-section (2) of section 69 is open to question. The facts of the present case give rise to an altogether different situation.

10. The learned counsel for the appellants also drew my attention to the decision in Firm Buta Mai v. Chaman Lal, AIR 1964 270. There it was laid down that when a suit was instituted in the name of a firm, the suit is in essence on behalf of the partners. All the partners, it was held, must be deemed to be the persons suing within the meaning of S. 69(2). Therefore, where a certain person who had been a partner from the beginning of the constitution of the firm was not shown as a partner in the register of firms, the suit was held to be incompetent, though the names of the partners actually suing were found in the register. To my mind, the ratio of this decision is not narrated by the language of section 69(2). The requirment of that section is limited to proof of an entry relevant to the persons suing. But, the learned Judges of the Punjab High Court have widened the scone of the rule far beyond the express terms of sub-section (2) of section 69.

11. It is now necessary to examine cases on the other side of the line, on which reliance has been placed by the learned counsel for the respondent. The case which lends direct support to his argument is found in AIR 1952 All 695 supra. In that case, a Division Bench of the Allahabad High Court came to the conclusion that where a plaintiff is described by the name of the firm and the plaint shows that the firm is suing through a partner, the suit is substantially one instituted by the firm under Order 30 Rule 1 of the CPC. The description or addition of the name of the partner was held to be inconsequential and was ignored as redundant. The firm was in fact held to be the plaintiff, because Order 30, Rule 1, enables a suit being filed in the name of the firm. On this hypothesis it was held that inasmuch as the plaintiff firm was registered under the Indian Partnership Act, the requirements of Section 69(2) were complied with and the plaint could not be rejected for want of a copy of a register of firms showing that the names of the partners suing as partners were shown as such in the register.

12. Relying on this case, it is submitted on behalf of the respondent that the proof of the registration of the firm is sufficient to overcome the hurdle interposed by sub-section (2) of S. 69 as a firm may sue in its own name under Order 30, Rule 1 the only requirement is whether the registration of the firm is proved. There is no warrant for holding that the addition of the names of the partners is requisite for maintaining the action. To insist upon the addition of the names of the partners is virtually to circumvent or set at naught the provisions of Order 30, Rule 1 of the CPC. As the maintainability of the suit brought in the name of a partnership firm cannot be doubted, it would follow that the only requirement that is to be made out is a registration of the firm.

13. The learned Judges observed:

“In the present case the firm was so described in the plaint, but the words ‘through Ram Kumar adult’ son of Sarjoo Prasad, caste Vaish residing at Naya Gung Kanpur, partner of the firm’ were added. In law this addition was unnecessary and as such It can be treated as redundant and ignored. The above addition does not and cannot alter the fact that the firm is in fact, the plaintiff.” Later they proceeded to state:

“It would thus appear that where a suit is instituted in the name of a firm under Rule 1 of Order 30 of the CPC it is really a suit by the partners of the firm collectively. The present suit was, therefore, a suit by the firm and the addition of the words through so and so was redundant and of no consequence.” With respect. 1 am of opinion that the reasoning underlying this decision is unexceptionable.

14. In AIR 1944 Oudh 37 (supra) the suit was brought by Sikri Brothers, Coal Merchants, through N.R Nagpal, partner and Manager. Nagpal verified the plaint under his signature and he described himself as the Manager and partner. The partnership was registered, but the name of Nagpal was shown in the register of firms as a partner of the Firm. It was held by a Division Bench of the Oudh Chief Court that Sikri Brothers were the real plaintiffs and that the mere mention of the name of Nagpal through whom the suit was brought, did not make him the plaintiff and that the defect, if any was want of form and not of substance.

15. The views expressed by the Oudh Chief Court and the Allahabad High Court were referred to in Firm Sunkari Yadgiri and Co. v. Union of India, AIR 1954 Hyd 172 where a Single Judge of the Hyderabad High Court held that the production of a certificate showing the registration of a firm is sufficient in a case where the suit was instituted in the name of the firm without any further description of the partners suing on behalf of the firm.

16. In construing the provisions of S. 69(2) one should bear in mind the procedure contemplated by Order 30 for the institution of suits by or against firms. Rule 1 of the Order 30 enables a suit to be filed in the name of the firm and any party to a suit may in such a case apply to a court for a statement of the names and addresses of the persons who were at the time of the accruing of the cause of action partners in such firm. If an application in that behalf is made the particulars have to be furnished and verified in such manner as the court may direct. Sub-rule (2) says that where persons sue as partners in the name of the firm, any pleading or other document required by the Court to be signed, verified or certified by the plaintiff or the defendant may be signed, verified or certified by any one of the partners suing in the name of the firm. The expression “suing as partners” occurring in section 69(2) of the Partnership Act, must be read and understood in the light of the provisions of Order 30. It is not un-reasonable to infer that the requirement contemplated by the later part of sub-section (2) of section 69 was intended to come into play only in cases where a disclosure of the names and particulars is called for in accordance with the provisions of Order 30. I am inclined to think that the conjunction ‘and’ in S. 69(2) has to be construed in the disjunctive sense. The context in which the conjunction is used seems to imply that the legislature used it in a disjunctive sense. If sub-section (2) is to be read as prescribing the two pre-conditions in all cases of suits brought in the name of the partnership firm the provisions of Order 30 may be rendered nugatory, or ineffective. But if the conjunction ‘and’ is construed in a disjunctive sense, and is read as ‘or’ the later part of sub-section (2) of section 69 would come into play only in those cases where a disclosure of the (names and particulars is made under I Order 30 of the CPC.

17. In (1962) 66 Cal WN 262 the contention was urged that the word ‘or’ should be substituted for ‘and’ in reading and construing sub-section (2). But the contention was repelled on the ground that there was no compelling necessity to interpret the word in a disjunctive sense. The learned Judge, however, did not take into consideration the provisions of Order 30. I am of opinion that the word ‘and’ occurring in sub-section (2) should be read as ‘or’. If this construction is adopted, it would follow that the expression ‘persons suing’ as partners of the firm could be made applicable only to the persons whose names are disclosed as partners in accordance with the procedure laid down by Order 30.

18. A review of all the authorities goes to show that it is only the obiter dicta of the decisions of the Nagpur and Patna High Courts that lend support to the contention advanced by the appellants. The case in AIR 1952 Nag 57 supra is distinguishable for reasons already indicated by me. Nor is the authority in AIR 1964 Punj 270 supra in point. The last mentioned case rests on a construction of section 69(2) which is too wide and does not give due weight to the actual phraseology employed in the section. The ratio of the decisions of the Oudh Chief Court and the Allahabad High Court is clearly applicable to the case on hand. The High Court of Hyderabad also shared that view, on the application of the principles laid down in AIR 1952 All 695 supra, I hold that that the suit is maintainable although the register of firms containing the names of the persons suing has not been produced by the plaintiff.

19. The hire purchase agreement describes P.R.C Reddi as the managing partner of Sri Venkateswara Finance Corporation. The hire purchase agreement is admitted to be true, in the reply notice given by the defendants as also in the written statement. It is thus admitted by the defendants that Sri Venkateswara Finance Corporation is represented by its managing partner P.R.C Reddi who is described in the plaint as one of the managing partners. The provisions of section 69(2) only postulate that the name of the persons suing must be shown to have been entered as partners in the register of firms. The mode of proof of that fact is not in any way restricted. It is consequently open to the plaintiff to adduce evidence that the name of a partner suing on behalf of the firm has been entered as such in the register of firms. Viewed in this angle, the requirement of even the second part of S. 69(2) must be deemed to have been fulfilled. The addition of the two other persons who are also described as managing partners must be disregarded as inconsequential because the suit on behalf of the firm, if brought even by one of the managing partners, cannot be dismissed as incompetent. The next contention urged by the learned counsel for the appellants is that the hire purchase agreement is illegal and cannot be sued upon. The illegality vitiating the agreement has not been clearly formulated. All that he was able to urge is that the motor vehicles in question were previously owned by the defendants and that there was no valid transfer of the title to the plaintiff firm. I do not think this contention is well founded. The submission of Counsel is that there is a breach of the terms of section 31 of the Motor Vehicles Act. This contention rests upon the erroneous reading of the Section. All that the section requires is that after the transfer, the authorities concerned must be notified about the change of the owner-ship. If there is an omission in that regard, certain penalties are indicated. The omission to notify the change of ownership does not make the transfer it self illegal. The view which I am inclined to take on a construction of section 31 is borne out by a decision of the Madras High Court Murthyasami Gounder v. Thulasi Ammal, (1970) 1 Mad LJ 263 which I came across after the conclusion of the arguments. The learned Judge construed Section 31 in the sense that the transfer itself is not rendered illegal for contravention of the duty imposed upon the parties to the transfer. There is no substance in the argument that there was no valid transfer of the vehicle. Nor is there any foundation for the counsel's submission that the delivery of the vehicle to the hirer is illegal without an intimation of the transfer of ownership to the authorities concerned. The plying of the vehicles by the hirer on foot of the hire purchase agreement is not illegal and no provision of the Motor Vehicles Act is contravened by the insurance of the vehicles by the hirer although the ownership continues to vest in the other party to the agreement.

20. It is then urged that the amount actually lent was only Rs. 9,500/- and not Rs. 10,400/- as claimed by the plaintiff. There is an admission that Rs. 10,450/- was lent in paragraph (5) of the written statement. In view of this admission, no weight can be attached to Ex. A. 2. Further the document relied on by the Counsel for the appellants shows that the total amount due was Rupees 10,450/- because of the addition of the insurance charges to the cash that was advanced to the hirer.

21. There is no substance in the other contentions urged by the learned counsel for the appellants.

22. The appeal fails and is dismissed with costs.

23. Appeal dismissed.

M.J Velu Mudaliar And Another v. Sri Venkateswara Finance Corpn. And Others

Structured Summary of the Opinion

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellants' (Defendants') Arguments

Respondent's (Plaintiff's) Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

M.J Velu Mudaliar And Another v. Sri Venkateswara Finance Corpn. And Others

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