M/s.Chendur Forgings (P) Ltd. v. M/s.Bhandari Interstate Carriers

accident, a meeting was held and it was agreed that a crane would beengaged to lift the consignment from the accident spot. Thedefendant had also accepted to pay crane charges along with thefreight charges at the time of taking delivery of consignment fromthe plaintiff. The consignment was delivered to the defendant on11.08.1986 and its bill for charges incurred in engaging a craneamounts to Rs.26,925/-. The plaintiff sent a letter to the defendanton 25.12.1986 demanding payment and the defendant replied to the sameby letter dated 29.12.1986 regretting their inability to settle theamount. Thereafter, the defendant by its letter dated 05.03.1987enclosed a cheque for Rs.26,925/- requesting the plaintiff to issueopen delivery certificate against such payment. The plaintiff agreedto issue the certificate on realisation of the draft. As thedefendant wilfully neglected to make payment which was unpaid formore than 9 months, the plaintiff filed a suit for recovery of a sumof Rs.26,925/- payable with interest at 18% per annum. 3.In the written statement, the appellant/defendant hasstated that the plaintiff is not a registered partnership firm and ifso, the defendant has put the plaintiff to strict proof that there issufficient and strict compliance of Section 69(2) of the PartnershipAct. He also stated that the plaint is signed by the RegionalManager of the plaintiff firm, who is not competent to sign theplaint for and on behalf of the registered partnership firm and thesuit is liable to be dismissed on that ground. As per theundertaking given by the plaintiff to the consignor at Faridabad andas per the terms of carriage the plaintiff had with the consignor,the defendant is under an obligation to pay Rs.1200/- per tonne bymeans of an account payee cheque on due performance of the publicemployment. According to the defendant, there was no contractbetween them and the plaintiff to pay the said crane charges claimedby the plaintiff. On 27.03.1987, the defendant wrote a letterdemanding compensation in respect of damages sustained by theirmachine. Therefore, according to the defendant the suit claim isliable to be dismissed.4.The Trial Court, on consideration of the facts andcircumstances of the case and on analysis of the oral and documentaryevidence decreed the suit in favour of the plaintiff for a sum ofRs.38,237/- with further interest at the rate of 18% per annum onRs.26,925/- from the date of plaint till the date of realisation withcosts. Aggrieved over the judgment of the Court below, the defendanthas filed this appeal.5.Learned counsel for the appellant has contended that thetrial Court miserably failed to appreciate the fact that in respectof a partnership firm it should be specifically pleaded that it is aregistered partnership firm under Section 69(2) of the partnershipAct and prove such fact coupled with execution of the plaint andverification of the same by a person who is reflected as a partner in https://hcservices.ecourts.gov.in/hcservices/ the register of Registrar of Firms; it is the responsibility of thecarrier to deliver the consignment at the destination and theappellant is in no way responsible to bear the transhipment chargesen route and that the trial Court failed to note that the respondentis a common carrier and as a person engaged in public employment forgain should not have called upon the appellant to bear crane chargesfor lifting the machine from the accident spot. It is his furthercontention that the person, who signed the plaint and verified thesame was not a power agent duly constituted to act for and on behalfof the plaintiff; no affidavit of power was filed; there was nopleading with respect to compliance of Section 69 (2) of the IndianPartnership Act; the plaint is filed on the strength of Ex.A-20,which is a special power of attorney, executed in favour of theauthorised signatory and the said power of attorney was executed byonly one of the partners; there is no specific delegation of power inthe Partnership Deed to a single partner to execute a power ofattorney, which implies that Ex.A-20 is not valid in law and as thereis no recital regarding delegation of power to a single partner toexecute a power of attorney in the deed, it necessarily follows thatit is a matter not provided in the deed and that the provisions ofthe Act will apply; the delegation of power was not provided for inthe partnership deed and consequently Exs.A-20 and A-21 are all of noavail to the respondent to get over the bar under Section 69 (2); asthe person who signed in the plaint is not reflected in Form-A, Ex.A-19, the suit is hit by Section 69 (2). 6. The learned counsel would also contend that once the barunder Section 69 (2) gets attracted, the logical corollary will bethat the said provision, being mandatory in nature, would make thesuit incompetent on the very threshold; in view of the fact thatthere is no ratification clause in Ex.A-21, it will not cure thedefect as on the date of filing of the suit and the Court is bound toreject the plaint; Ex.A-21 was executed only on 16.03.1990, whereasthe plaint was signed by the Manager on 28.11.1988; further, areading of Ex.A-3 will reveal that it is not an unconditionalundertaking or promise to pay by the appellant, as it was subject tocompliance of two conditions viz., (i) the payment will be subject toapproval by Mr.Hundiwala after making enquiries at Delhi, whichapproval is not obtained and there is no pleading or proof to thateffect, and (ii) it is agreed that Mr.Suri will send the originalsurvey report by courier to the appellant with a copy to theconsignor which is also not complied with; the finding of the trialCourt to the effect that issuance of open delivery certificate is notcontemplated in Ex.A-3 will not hold good; the trial Court erred inrelying upon only one portion of Ex.A-3 and brushed aside the otherimportant aspects; the appellant offered to pay the alleged chargesonly without prejudice to their rights and liabilities as found inEx.A-12 and it was subject to the condition that open deliverycertificate would be issued by the respondent for processing theclaim of the appellant under the policy of insurance and that the https://hcservices.ecourts.gov.in/hcservices/ respondent wilfully refused to receive the demand draft by contendingthat it may not be honourned and the refusal to give open deliverycertificate will only disentitle the respondent from the reliefclaimed in the plaint. 7. The further argument of the learned counsel is that inthe absence of any absolute undertaking to pay, the respondent is notentitled for the crane charges; Ex.A-3 was brought under undueinfluence; it is the duty of the plaintiff to properly and safelycarry and deliver the cargo entrusted to him; the demand to pay cranecharges is against law and absolute liability under Section 9 of TheCarriers Act will clearly fasten the liability on the respondent, whofailed to prove that the accident was not on account of hisnegligence and will not absolve him from the liability and that theburden of proving that a contract is not by Section 16 of theContract Act is heavily on the person who is in a position toexercise that advantage over the other person and the respondent hasexploited the predicament of the appellant whose machinery worthseveral lakhs of rupees was at the road side susceptible for furtherdamages insisting on the appellant to be a party to Ex.A-3, whereinthere is no concluded obligation on the part of the appellant to paycrane charges inasmuch as the prescribed conditions are not compliedwith. According to the learned counsel, the respondent was in aclear position to dominate the will of the appellant and evenassuming that Ex.A3 is a concluded contract, it will be hit bySection 16 of the Indian Contract Act. Accordingly, the learnedcounsel prayed for allowing the appeal. 8. In support of his contentions, learned counsel for theappellant has relied upon the following decisions :(i)AIR 1982 Allahabad 376, Daya Shankar vs. Smt.Bachiand others :"6.... "Where there is a question as to the goodfaith of a transaction between parties, one of whom standsto the other in a position of active confidence, the burdenof proving the good faith of the transaction is on theparty who is in a position of active confidence." ... Any relationship in which one party enjoys the"active confidence" of another party who is to lean on himis enough to approximate to the kind of relationship whichmay attract the provisions of Section 111 of the EvidenceAct with regard to the rule of burden of proof.Consequently, even if restricted and technical constructionwere put on the term 'fiduciary relationship', theprinciple enshrined in Section 111 should be extended tocases where there is proof of a person dependent, by virtueof his physical or mental infirmity or disability on https://hcservices.ecourts.gov.in/hcservices/ another party and the circumstances have been proved toshow that the other party, taking advantage of suchposition, has secured a deed or instrument for his ownbenefit."(ii)AIR 1984 Himachal Pradesh 11, Smt.Takri Devi vs.Smt.Rama Dogra and others :"22.The value of the gifted property is about twolakhs and there is an apple orchard in this land. Thedonee (Charan Dass 'deceased') was a Bairagi by castewhile the plaintiff is a Brahmin. There is no relationshipbetween the two (i.e. The donor and the donee). Theplaintiff and the donee were living in different villages,which are at a distance of about 20 Kms. from one another.The plaintiff has practically gifted all landed propertyby the gift deed Ex.D-1. In view of these circumstances,the transaction appears to be unconscionable."(iii)AIR 1985 Madras 321, Andalammal vs. RajeswariVedachalam (deceased by LR) and others : "12.... "Even if the burden of proof does not lieon a party the court may draw an adverse inference if hewithholds important documents in his possession which canthrow light on the facts at issue. It is not, in ouropinion, a sound practice for those desiring to rely uponcertainstate of facts to withhold from the Court the bestevidence which is in their possession which could throwlight upon the issues in controversy and to rely upon theabstract doctrine of onus of proof."(iv)AIR 1987 Bombay 348, Gandhi & Co., vs. Krishna GlassPvt. Ltd. :"10.The learned Judge in that case dissented from theview of the Calcutta High Court in (1962) 66 Cal. WN 262where the contention that the word 'and' in S.69(2) be readas 'or' was rejected. As discussed earlier, the scope andambit of the provisions of Rr.1 and 2 of O.30 of the CivilP.C. is different from the provisions of S.69(2) of thePartnership Act. The provisions contained in Rr.1 and 2 areprocedural; whereas the provisions of S.69(2) aresubstantive and create a bat at the threshold of the filingof suit by or on behalf of a firm, if the conditionsmentioned therein are not fulfilled. S.69(2) says that"not suit shall be instituted.... by or on behalf of thefirm .... unless the firm is registered and the personssuing are or have been in the Register of Firms as partners https://hcservices.ecourts.gov.in/hcservices/ in the firm." On a plain reading of the Section both theconditions laid down in the Section must be fulfilled andthat is clear from the fact that the word 'and' is used andappears in the Section. We have already indicated thateven if a suit is filed in the name of a firm it is insubstance a suit by the partners of the firm and the phrase'the persons suing' therefore, will have to be construed asthe names of all the partners constituting the firm, at thetime of the institution of the suit. In our opinion, theexpression 'persons suing' can only mean the persons whofile the suit on behalf of the firm. If this is theconstruction which requires to be adopted on the saidphrase used in the provision it would logically follow thatthe word 'and' cannot be construed disjunctively, assuggested by the learned counsel. It is well settled ruleof construction of a statutory provision that unless thereis ambiguity or that two constructions are possible, thenormal rule of giving a plain meaning to he words used hasto be followed. We find that the provisions of S.69(2) areclear and unambiguous and there is no scope for giving adifferent meaning to the word 'and'. We, therefore, rejectthe argument that if the suit is filed in the name of thefirm all that is required to be shown is that the firm isregistered on the date of the suit and the second conditionrelating to the names of the persons being shown aspartners in the Register of Firms does not apply to such asuit. The question of the applicability of the provisionsof Rr.1 and 2 of O.30 of the Code arises only if the suititself is validly instituted in compliance with theprovisions of S.69(2) and not otherwise. These provisionsof the Code, therefore, cannot be of any assistance ininterpreting the provisions of S.69(2). "(v)AIR 1998 SC 3085, M/s.Raptakos Brett & Co. Ltd. vs. GaneshProperty :"22. So far as the applicability of the bar of Section69 sub-section (2) of the Partnership Act is concerned, itis true that it is a penal provision which deprives theplaintiff of its right to get its case examined on meritsby the court and simultaneously deprives the court of itsjurisdiction to adjudicate on the merits of thecontroversy between the parties. It will, therefore, haveto be strictly construed. It is also true that once onsuch construction of this provision, the bar under Section69(2) of the Act gets attracted, then the logicalcorollary will be that the said provision being mandatoryin nature would make the suit incompetent on the verythreshold. Consequently, it is not necessary for us toexamine various decisions of this Court rendered in https://hcservices.ecourts.gov.in/hcservices/ connection with Section 80 of the CPC or Section 77 of theIndian Railways Act, 1890 to which our attention wasinvited by learned Senior Counsel, Shri Nariman. We mayproceed on the basis that for sustaining a suit whichfalls within the sweep of Section 69 sub-section (2), thecondition precedent is that the firm must be registered atthe time of filing of the suit. If it is not registered,the suit must be held to be incompetent from theinception. ...In the present case, we are concerned with the leasewhich has come to an end and the erstwhile tenant hasremained in occupation as a tenant at sufferance. Underthe law, the erstwhile landlord is entitled to therestoration of possession by enforcement of statutoryobligation of the erstwhile tenant as statutorily imposedon him under Section 108(q) read with Section 111(a) ofthe Property Act. The non-compliance of the statutoryobligation by the defendant when made the subject-matterof a corresponding legal right of the erstwhile landlordcannot be said to be giving rise to enforcement of anycontractual right of the plaintiff arising from theexpired contract of tenancy. As seen earlier, thecontroversy would have clearly ended in favour of therespondent and against the appellant if the plaint hadreferred to only the law of the land under which thedefendant was required to be evicted on the expiry of thelease. But unfortunately for the plaintiff, the suit isalso based on the breach of the covenant of the lease asseen from para 2 of the plaint. It is, therefore, notpossible to interpret the averments with reference to thecovenant of the lease only as referring to a historicalfact as tried to be submitted by Dr.Singhvi for therespondent. "9. I have heard the learned counsel for the respondent onthe above aspects, who, while repudiating the contentions of thelearned counsel for the appellant, cited the following decisions .(i)AIR 1976 Madras 151, M.C.S.Rajan and Co. vs. NationalNail Industries, Tiruchirappalli and others :"6. ... "where a plaintiff has not signed a plaint,filled with his knowledge and consent, it is an omissionwhich can be cured, and indeed, should be corrected in theinterests of justice. The omission to sign or verify aplaint is not such a defect as could affect the merits of https://hcservices.ecourts.gov.in/hcservices/ a case or the jurisdiction of the Court and is curableunder the provisions of Section 99, Civil Procedure Code."The learned Judges have gone to the extent of sayingthat:-"If the defect is not discovered until the case comeson for hearing before an appellate Court, the appellateCourt may order the amendment to be made in that Court.The appellate Court ought not to dismiss the suit orinterfere with the decree of the lower Court merelybecause the plaint has not been signed."Even the Allahabad High Court dealing with a similarsituation, but under the old Act, (reported in Maharaja orRewah vs. Swami Saran, (1903) ILR 25 All 635) in a casewhere a plaint was filed in the Revenue Court by a personnot properly authorised to sign the same at the time ofpresentation, but which was cured by subsequent sanction,observed as follows:-"Where the plaint in a suit filed in a Court ofRevenue on behalf of a Ruling Chief was signed by a personwho at the time of signing had not been speciallyappointed by Government for such purpose under Section 432of Civil P.C. but was so appointed before the period oflimitation in respect of such suit had expired, the plaintwas a valid plaint for all purposes."Therefore, the finding of the court below on thispoint has to be set aside. As all other issues have beenfound in favour of the appellant and as there is no oneappearing for the respondents before us, the appeal isallowed with costs and the plaintiff-appellant would beentitled to the decree as prayed for."(ii)AIR 1978 ORISSA 167, Prag Oil Mills Depot vs. Corporationof India and another :"7.... "... when a case had been tried by a Court onthe merits and judgment rendered, it should not be liableto be reversed purely on technical grounds, unless it hadresulted in failure of justice, and the policy of thelegislature has been to treat objections to jurisdictionboth territorial and pecuniary as technical and not open toconsideration by an appellate Court, unless there has beena prejudice on the merits." https://hcservices.ecourts.gov.in/hcservices/ In the decision reported in AIR 1956 Hyd 133 (RadhaKishen vs. Wali Md.), Bilgrami,J. has observed as follows :"The plaint cannot be rejected under this rule merelybecause it is in some way defective, or not strictly inaccordance with law. It is true that the grounds forrejection given in Order 7, Rule 11 are not exhaustive, andthe plaint can be rejected for reasons not specified incls. (a) to (d) of Rule 11, but then, defect for which itis rejected should not be such as is curable by amendment,and nothing more than an error of procedure. ... "10. The only question, which arises for consideration, is,whether the appellant is liable to pay the crane charges ?11. Before delving into the matter, it is useful to extractSection 69 (2) of The Indian Partnership Act,1932 and Sections 16,196 and 199 of The Indian Contract Act,1872.12. Section 69 (2) of The Indian Partnership Act,1932,reads as under :"69. Effect of non-registration. (1) .....(2) No suit to enforce a right arising froma contract shall be instituted in any Court by oron behalf of a firm against any third partyunless the firm is registered and the personssuing are or have been shown in the Register ofFirms as partners in the firm." 13. Sections 16, 196 and 199 of The Indian ContractAct,1872, run as below :"16. Undue influence – (1) A contract issaid to be induced by "undue influence" where therelations subsisting between the parties are suchthat one of the parties is in a position todominate the will of the other and uses thatposition to obtain an unfair advantage over theother. (2) In particular and without prejudice tothe generality of the foregoing principle, aperson is deemed to be in a position to dominatethe will of another - https://hcservices.ecourts.gov.in/hcservices/ (a) where he holds a real or apparentauthority over the other or where he stands in afiduciary relation to the other; or (b) where he makes a contract with a personwhose mental capacity is temporarily orpermanently affected by reason of age, illness ormental or bodily distress.(3) Where a person who is in a position todominate the will of another, enters into acontract with him, and the transaction appears,on the face of it or on the evidence adduced, tobe unconscionable, the burden of proving thatsuch contract was not induced by undue influenceshall lie upon the person in a position todominate the will of the other.Nothing in this sub-section shall affect theprovision of section 111 of the Indian EvidenceAct,1872.""196. Right of person as to acts done for himwithout his authority - Effect of ratification.-Where acts are done by one person on behalf ofanother, but without his knowledge or authority,he may elect to ratify or to disown such acts.If he ratifies them, the same effects willfollow as if they had been performed by hisauthority.""199. Effect of ratifying unauthorised actforming part of a transaction. - A personratifying any unauthorised act done on hisbehalf ratifies the whole of the transaction ofwhich such act formed a part."14. I have given careful consideration to the submissionsmade by the learned counsel for the parties; perused the material andrecords and also gone through the various decisions relied upon bythe parties.15. Concedingly, the respondent company is a partnershipfirm and the same is registered, as evidenced from the PartnershipDeed,Ex.A-17; the Certificate of Registration, Ex.A-18 and the Formof Registrar of Firms, Ex.A-19. Under Ex.A-20, Special Power ofAttorney was given to the Regional Manager of the company for filingthe suit. It is true that Ex.A-20 was signed by only one partner ofthe respondent firm instead of all the three partners. However, https://hcservices.ecourts.gov.in/hcservices/ subsequently, the said defect was rectified, by executing anotherpower deed through Ex.A-21, wherein all the partners have signed.Though Ex.A-21 was executed subsequent to the filing of the suit, itwould not non-suit the respondent, in view of the provisionscontained under Sections 196 and 199 of the Indian Contract Act. So,the question of non-registration, as contemplated under Section 69(2), does not arise and the respondent can very well file the suit,as the firm being a registered one and the persons on whose behalfthe suit was instituted were shown in the Register of Firms aspartners in the firm, who, in turn, appointed the Regional Manager astheir Power of Attorney.16. Coming to Ex.A-3, Minutes of the Meeting, which washeld between the parties subsequent to the accident, it is clearlystated therein that the crane charges will be paid along with thefreight charges by Excel Forge Pvt.Ltd, Madras, who is the appellantherein, at the time of taking delivery of the consignment. It is alsostated therein that regarding crane charges, Mr.Suri, who is therespondent, had indicated Rs.25,000/-, which will be approved byMr.Hundiwala after making enquiries at Faridabad/Delhi and Mr.Suriwill send the original survey report by courier service to ExcelForge Pvt.Ltd. with a copy to Ameteep to enable Excel Forge to claiminsurance.17. It is significant to mention here, that, in Ex.A-9, theappellant has admitted that the accident to the machine was certainlynot due to any of the parties and thereby agreed to pay the cranecharges under Ex.A-3. Hence, it is not open to the appellant tocontend that it is the duty of the respondent to properly and safelycarry and deliver the cargo entrusted to him.18. The further contention of the appellant is that Ex.A-3is executed by undue influence and hence it is not a valid contract. 19. It is true that a contract is said to be induced byundue influence, where the relations subsisting between the partiesare such that one of the parties is in a position to dominate thewill of the other and uses that position to obtain an unfairadvantage over the other and a person is deemed to be in a position todominate the will of another where he holds a real or apparentauthority over the other or where he stands in a fiduciary relationto the other or where he makes a contract with a person whose mentalcapacity is temporarily or permanently affected by reason of age,illness or mental or bodily distress or where a person who is in aposition to dominate the will of another, enters into a contract withhim, and the transaction appears, on the face of it or on theevidence adduced, to be unconscionable, the burden of proving thatsuch contract is not induced by undue influence shall lie upon theperson in a position to dominate the will of the other. https://hcservices.ecourts.gov.in/hcservices/

20. In this context, it has to be stated that when the appellanthimself has admitted that the accident to the machine was certainlynot due to the negligence of the respondent and subsequently agreedto pay the crane charges under Ex.A-3, by no stretch of imagination,it can be said that Ex.A-3 came to be executed by undue influence.Further, when Ex.A-3 is categorical to the effect that crane chargeswill be paid along with the freight charges at the time of deliveryof the consignment, the appellant cannot take a different stand inEx.A-6 that crane charges will be paid only after insurance claim issanctioned. Moreover, it is not incumbent on the respondent to sendOpen Delivery Certificate, as claimed by the appellant, as there isno specific clause to that effect. Ex.A-3 is also clear that paymentof crane charges is not subject to approval by Mr.Hundiwala aftermaking enquiries. Instead, it is only stated therein that the saidcharges will be approved. Once the payment is received, as per theagreement in Ex.A-3, the respondent will definitely send the originalsurvey report by courier service to the appellant with a copy toAmeteep to enable the appellant to claim insurance, but, it shouldnot be such that only after receiving the amount from the insurer,the crane charges will be paid. 21. In Ex.A-13, the appellant has claimed damages ofRs.3.00 lakhs and odd from the respondent for the alleged loss hesustained due to the accident. If at all he has sustained any lossthat too because of the negligence of the respondent, it is notknown what prevented the appellant from filing a suit against therespondent, claiming damages, which only proves that the respondentis not liable to pay any damages, because of the accident.22. It is also preposterous to contend that the respondentwilfully refused to receive the demand draft sent by the appellant.This is so, because, in Ex.A-16, the appellant has admitted that hewithheld the demand draft, for the reason that Open DeliveryCertificate was not issued by the respondent.23. For all the above reasons, this appeal suffersdismissal. The trial Court has dealt with each and every aspect ofthe matter in detail and come to the definite conclusion, givingcogent reasons. There is also no illegality or irregularity in thejudgment of the Court below. Therefore, there is no iota of scope forthis Court to interfere with the judgment and decree of the trialCourt. As such, this appeal is dismissed. No costs.sd/-Asst.Registrar/true copy/Sub Asst.Registrar https://hcservices.ecourts.gov.in/hcservices/ dixitTo1. The I Assistant Judge, City Civil Court, 'Madras.2.The Registrar,City Civil Courts,Madras.3. The Section Officer,VR Section,High Court, Madras.+1 cc To M/s.Nageswaran & Narichania, Advocate, SR.31541+1 cc To Mr.S.Vijayakumar, Advocate, SR.31588A.S.No.1381 of 1994bv [co]gkg/11.7