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Municipal Council v. K. Ravindra And Company
Case Summary
Factual and Procedural Background
The revision was disposed of finally at the stage of admission by consent recorded on 15-1-2003. The central factual background is that respondent No. 1, a proprietory concern, instituted Special Civil Suit No. 33 of 1995 in the Court of Civil Judge, Senior Division, Bhandara, against the State of Maharashtra and other defendants, including Municipal Council, Tirora (the present revision-petitioner). The plaint described the plaintiff as "K. Ravindra and Company, through its proprietor Shri Narayan Sakharam Kantode". The suit had been posted for arguments before a new Presiding Officer after a transfer. At that stage defendant No. 3 (the revision-petitioner) filed an application for dismissal of the suit on the ground that "K. Ravindra and Company" is neither a partnership firm nor a limited company and that its sole proprietor cannot sue in the firm's trade name. The Trial Court (by order dated 21-10-2002) rejected that application. The revision challenges the Trial Court's order rejecting the dismissal application.
Legal Issues Presented
- Whether the sole proprietor of a firm can sue in the name of the firm (i.e., whether a sole proprietor may institute suit in the firm's trade name).
- Whether the present revision is maintainable in view of the 1999 amendment to section 115, Civil Procedure Code (as argued by respondent No. 1), given the nature of the Trial Court application (for dismissal) and the potential for final disposal of the suit.
Arguments of the Parties
Respondent No. 1's Arguments
- Contended that the revision was not maintainable in view of the 1999 amendment to section 115 Civil Procedure Code whereby clause (b) of the proviso to sub-section (1) of section 115 was deleted. Reliance was placed on Rajabhau S/O Mahadeorao Rahate…Applicant; v. Dinkar S/O Shantaram Ingole…Non-Applicant., 2002 (3) Mh. L.J 921.
- Argued that even if it is held that a sole proprietor cannot sue in the trade name, the suit should not be dismissed because rectification of the plaint is permissible in appropriate cases; thus, the remedy would be correction rather than outright dismissal.
Revision-Petitioner's Arguments
- Submitted that the suit was not maintainable because the plaintiff sued in a trade name and a sole proprietor cannot sue in the firm/trade name. Cited R.J Mohammed Yakub Saheb v. Dipa Sahu Deoki Prasad, AIR 1959 Patna 200 and Bhagvan Manaji Marwadi v. Hiraji Premaji Marwadi, AIR 1932 Bombay 516 to support this position.
- Alternatively, the revision-petitioner accepted that rectification might be permissible but submitted that the respondent should be permitted to apply for rectification and that the Trial Court should decide any such application on its merits; the revision-petitioner also suggested that limitation issues be left to the Trial Court.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Rajabhau S/O Mahadeorao Rahate…Applicant; v. Dinkar S/O Shantaram Ingole…Non-Applicant., 2002 (3) Mh. L.J 921 | Cited in relation to the effect of the 1999 amendment to section 115, Civil Procedure Code, on the maintainability of revisions (deletion of clause (b) of proviso to sub-section (1)). | The court noted the submission but held that because the Trial Court application sought dismissal (a relief that, if accepted, would finally dispose of the suit), the revision would be within the proviso to section 115 and therefore maintainable; the precedent was considered in that context. |
| R.J Mohammed Yakub Saheb v. Dipa Sahu Deoki Prasad, AIR 1959 Patna 200 | Holds that a Hindu joint family trading concern may be sued in an assumed name under Order 30, Rule 10, but such a concern cannot sue as plaintiff in a firm name under Order 30, Rule 1; suit by a trading concern must be brought by the Karta or by all coparceners. | Cited by the revision-petitioner to support the proposition that a concern which is not a firm in legal sense cannot sue in the firm/trading name; relied on to argue non-maintainability of the plaint as filed. |
| Bhagvan Manaji Marwadi v. Hiraji Premaji Marwadi, AIR 1932 Bombay 516 | States that one man cannot constitute a firm; a person trading in an assumed or trading name may be sued in that name under Order 30, Rule 10, but cannot sue in that name. | Relied on by the revision-petitioner to support the position that the sole proprietor could not sue in the firm's name. |
| J.D Singh v. Calcutta Port Trust, AIR 1994 Calcutta 148 | Holds that while a plaint in the name of an unregistered firm may be non est for all purposes, a plaint or proceeding instituted in the trade name of a sole owner is not necessarily void for all future purposes; in bona fide cases, courts may permit rectification so the actual claimant is shown on record. | The court relied on this authority to treat the present misdescription as a bona fide error and to permit rectification of the plaint so that the actual proprietor is shown as plaintiff; used as principal support for allowing correction rather than dismissal. |
| Neogi Ghose & Co. v. Sardar Nehalsingh, AIR 1931 Calcutta 770 | Approves the permissibility of rectification where a suit was brought in the name of a firm and the plaintiff sought amendment to show the actual person carrying on business; indicates readiness to allow amendment subject to costs and limitation considerations. | Cited in relation to the possibility of rectification; the court acknowledged this authority as approving amendment/rectification in appropriate cases. |
| The Lucknow Automobiles through Mt. Munia, Propritress v. The Replacement Parts Co., AIR 1940 Oudh 443 | Holds that when the plaint includes the actual plaintiff described as acting "through" the trading concern (e.g., "through Mt. Munia, Propritress"), the addition removes the defect and makes clear who the plaintiff is. | The court referred to this authority to note that where the plaint already indicates the actual proprietor "through" the trading concern, the defect is on stronger footing and supports rectification; used to reinforce the view that the present case is amenable to correction. |
Court's Reasoning and Analysis
The court began by identifying the central question—whether a sole proprietor can sue in the name of a firm—and reviewed the procedural posture: the application before the Trial Court sought dismissal of the suit on the ground of misdescription. The court examined submissions on both maintainability of the revision and on the substantive question of whether the plaint was properly framed.
On maintainability, the court considered respondent No. 1's reliance on the 1999 amendment to section 115 CPC but observed that the application before the Trial Court sought dismissal (a remedy that would finally dispose of the suit). The court concluded that if the contention of the revision-petitioner were accepted (i.e., if the suit were to be dismissed), that would amount to a final disposal and the proviso to section 115 would render the revision maintainable. Thus the court proceeded to resolve the substantive issue.
On the substantive question, the court analysed authorities cited by both sides. It accepted the settled principle in several precedents that a person carrying on business under a trade name may be sued in that name but cannot himself sue in that assumed or trading name as if it were a legally constituted firm. However, the court distinguished the present case on the factual description in the plaint: the plaint already described the claimant as "K. Ravindra and Company, through its proprietor Shri Narayan Sakharam Kantode". Applying the ratio of J.D Singh and related authorities, the court characterised the description as a misdescription arising from a bona fide mistake rather than a defect that must lead to dismissal.
The court considered the possibility of limitation objections but concluded that this was not a case where limitation would bar rectification. Drawing on authorities that permit amendment or correction to show the true claimant where an error is bona fide, the court determined that the appropriate remedy was to allow rectification to the form "Shri Narayan Sakharam Kantode, Proprietor of K. Ravindra & Co." and to remit the matter to the Trial Court to permit the correction and proceed further in accordance with law.
Holding and Implications
REVISION PARTLY ALLOWED
Holding:
- The Trial Court's finding that a suit filed in the assumed name by its proprietor is tenable was set aside.
- The court held that rectification of the plaint was required and directed that the plaintiff/respondent No. 1 be permitted to correct the plaint to read "Shri Narayan Sakharam Kantode, Proprietor of K. Ravindra & Co.".
- On such correction being made, the Trial Court was directed to proceed with the case further according to law. No order as to costs was made.
Implications:
The direct effect is procedural and interlocutory: the plaintiff is permitted to rectify the misdescription in the plaint and the suit will continue after such correction instead of being dismissed. The opinion does not purport to lay down a new general precedent beyond applying existing authorities that allow rectification for bona fide misdescription; no broader legal doctrine was newly established in the judgment.
Revision partly allowed.
1. By consent recorded on 15-1-2003, this revision is being disposed of finally at the stage of admission itself.
2. The question involved in this revision is whether the sole proprietor of a firm can sue in the name of firm?
3. Respondent No. 1 herein, which is a proprietory concern, filed Special Civil Suit No. 33 of 1995 in the Court of Civil Judge, Senior Division, Bhandara, for the recovery of the amount, against the State of Maharashtra and other defendants, one out of whom is Municipal Council, Tirora, which is the revision-petitioner in this revision. The suit was instituted by respondent No. 1 in the name “K. Ravindra and Company, through its proprietor Shri Narayan Sakharam Kantode, aged about 60 years, resident of A/2/2 N.S.K Society, Civil Lines, Nagpur.” The case was once closed for judgment. Then after the Presiding Officer of the Court was transferred, the case came up before another Judge, who posted it for arguments. At that stage, the present revision-petitioner (Municipal Council, Tirora), which is defendant No. 3 in the aforesaid suit, filed an application for the dismissal of suit, raising an objection that the suit is filed by “K. Ravindra and Company”, which is neither a partnership firm nor a limited company and its proprietor cannot file a suit in the trade name of the proprietory firm. By the order dated 21-10-2002, the learned Joint Civil Judge, Senior Division, Bhandara, rejected the above application filed by the present revision-petitioner, which order of rejection is under challenge in this revision.
4. The learned counsel for respondent No. 1 assailed the very maintainability of the present revision in view of the amendment of 1999 to section 115, Civil Procedure Code whereby clause (b) of proviso to sub-section (1) of section 115, Civil Procedure Code is deleted. The learned counsel cited Rajabhau S/O Mahadeorao Rahate…Applicant; v. Dinkar S/O Shantaram Ingole…Non-Applicant., 2002 (3) Mh. L.J 921. The learned counsel canvassed that even if it is held that the sole proprietor of the firm cannot sue in the name of the firm, the suit cannot be dismissed and in view of some authorities, the rectification can be made in the name. Hence, according to her, even if the order goes in favour of revision-petitioner, the suit would not be disposed of finally, so the revision would not be maintainable. However, it may be seen that the application moved by the revision-petitioner before the Trial Court was for the dismissal of the suit, which was rejected by the Trial Court. This rejection is impugned in the present revision. If the contention of the revision-petitioner is accepted, the suit will stand disposed of finally and thus by virtue of proviso to section 115, Civil Procedure Code, the revision would be maintainable.
5. In support of her proposition about the non-maintainability of the suit, the learned counsel for revision-petitioner cited R.J Mohammed Yakub Saheb v. Dipa Sahu Deoki Prasad, AIR 1959 Patna 200. In this cited case, the suit was brought against the Hindu joint family trading firm in the name assumed by such firm. It was held that a Hindu joint family trading concern, though not a firm in the legal sense, may be sued in its assumed name of the business under the provisions of Order 30, Rule 10, Civil Procedure Code, but such a Hindu joint family trading concern cannot sue as a plaintiff in the firm name under the provisions of Order 30, Rule 1, Civil Procedure Code. Such a suit must be brought either by the Karta of the family or by all the members of the joint family who are coparceners. In the cited case, Hindu joint family carrying on business under its assumed name was a party. The provision of Order 30, Rule 10, Civil Procedure Code is also applicable to the person carrying on business in a name or style other than his own name. Hence such person can be sued in the assumed or trading name, but he cannot sue as a plaintiff in the assumed or trade name. The suit will have to be brought by the proprietor in his own name and not in the trading name.
6. The next case cited by the counsel for revision-petitioner is Bhagvan Manaji Marwadi v. Hiraji Premaji Marwadi, AIR 1932 Bombay 516. This case lays down that one man cannot constitute a firm, and a person trading himself as a firm or in an assumed or trading name may be sued in his trading name under Order 30, Rule 10, but he cannot sue in that name.
7. The counsel for respondent No. 1 cited J.D Singh v. Calcutta Port Trust, AIR 1994 Calcutta 148. It was held in this cited case that though a plaint in the name of an unregistered firm is legally non est for all purposes, yet, a plaint or a proceeding instituted in the trade or business name of a sole owner is not similarly deemed to be void for all future purppses. In cases of bona fide error where the mistake has been made not for any ulterior puipose that Court permits a rectification of the name so that the person suing is permitted even at a late stage to show himself as the claimant on record. Thus the case cited by the learned counsel for respondent No. 1 also accepts the proposition that the sole owner cannot file a suit in the trade name. However, the authority enables the rectification of the bona fide mistake.
8. The counsel for revision-petitioner cited Neogi Ghose & Co. v. Sardar Nehalsingh, AIR 1931 Calcutta 770. This case approves the proposition of permissibility of rectification. In this regard, the relevant facts were that on the objection being raised about the non-maintainability of suit as it was brought in the name of firm, the plaintiff, who was the sole proprietor of the firm, moved an application for amendment of plaint by inserting certain words before the name of firm, so as to indicate that the person carrying on business under the name and style of firm was the plaintiff. The learned Judge opined that the application should not be dismissed but having regard to the arguments, he expressed his preparedness to make the order directing that the amendment should be allowed upon the terms of payment of costs and holding that the plaintiff would be entitled to claim such relief if the suit had gone on from the time of his being joined as plaintiff. In short, the learned Judge was prepared to allow the amendment subject to costs and limitation. However, since the learned counsel for applicant canvassed that if the above view would be taken by the Court, the suit would be barred by limitation. So he asked to dismiss the application outright. The application was, therefore, dismissed.
9. The learned counsel for revision-petitioner, in addition to her aforesaid stand about the non-maintainability of suit, alternatively submitted that the respondent can be permitted to apply for rectification and the Trial Court can be directed to decide that application on its own merits. Thus, she impliedly submitted that the issue of limitation may be left open for being dealt with by the Trial Court. However, in my opinion, this is not a case in which the factor of limitation would come in the way of rectification. In the case of J.D Singh, AIR 1994 Cal. 148, the suit was brought in the name of ‘J.D Singh & Co.’. It was held that it was an erroneous description through bona fide mistake. The award was allowed to be corrected showing the name of claimant to read as ‘J.D Singh’. The present case is still on a better footing. Here the suit is brought in the name ‘K. Ravindra & Company, through its proprietor Shri Narayan Sakharam Kantode’. In the case The Lucknow Automobiles through Mt. Munia, Propritress v. The Replacement Parts Co., AIR 1940 Oudh 443, cited by the counsel for respondent No. 1, similar was the description of the plaintiff. It was held that there would no doubt have been a substantial defect in the plaint if it had been brought simply in the name of the Lucknow Automobiles, but the addition of the actual plaintiff (showing as through Mt. Munia) as propritress of the Lucknow Automobiles removes the defect as it makes quite clear who the plaintiff is.
10. In the instant case also, there is an addition of the name of actual plaintiff showing the Trading concern through its Proprietor Shri Narayan Sakharam Kantode. However, instead of taking that the defect is automatically removed, I hold that it is a case of misdescription through bona fide mistake. In view of the ratio of the case of J.D Singh, I think it appropriate to allow the plaintiff/respondent No. 1 to do the rectification in the name as ‘Slhri Narayan Sakharam Kantode, Proprietor of K. Ravindra & Co.’. Since the learned counsel for respondent No. 1 has placed reliance on the above authority, it can be taken that it is her request to grant permission to rectify.
11. In the result, the revision is partly allowed. The finding of the Trial Court in the impugned order that the suit filed in the assumed name by its proprietor is tenable, is set aside. It is held that the rectification in the name of the plaintiff is needed. The Trial Court is directed to allow the plaintiff/respondent No. 1 to make the correction in his name in the plaint as described in the preceding para. On such correction being made, the Trail Court shall proceed with the case further, according to law. No order as to costs.
Revision partly allowed.
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