A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION
AT HYDERABAD.
F.A. 109/2006 against C.C 575/2003, Dist. Forum-II, Hyderabad.
Between:
A.P.V. Subbaiah
S/o. Late Rangaiah
R/o. D-81, Madhura Nagar
Hyderabad-500 038. *** Appellant/
O.P. No. 2.
Vs.
1. V. V. Rama Narasaiah
S/o. Late Rangaiah
Retd. Employee
2. Smt. V. Amruta Bai
W/o. V. V. Rama Narasaiah
3. V. Prabhakar Rao
S/o. V. V. Rama Narsaiah
4. Smt. V. Sarala,
W/o. V. Prabhakar Rao
All are R/o. H.No. 10-2-287/1/1
Shantinagar, Hyderabad. *** Respondents/
Complainants
5. M/s. Abheeshta Finance Company
Flat No. 117, Sovereign Shelters
Behind Ganga Jamuna Hotel
Lakdikapool, Hyderabad. *** O.P. No. 1
6. M. Madan Mohan Rao
S/o. M. L. Narasimham
D. No. 12-2-823/A/30,
Santoshnagar Colony
Mehidipatnam
Hyderabad-500 028. *** O.P. No. 3
7. M. Sreenivas
S/o. M. V. Sastry
R/o. 12-2-823/A/28
Geeta Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 4
8. Capt. K. Kishan
S/o. Late Yellaiah
Plot No. 609,
Naveen Nagar Colony
Banjara Hills, Hyderabad *** O.P. No. 5
9. Smt. K. Vijaya Lakshmi
W/o. K. Shiva Kumar
R/o. 2-2-647/49,
Central Excise Colony
Nallakunta
Hyderabad-500 013. *** O.P. No. 6.
10. N. Venkateswara Rao
S/o. Late N. Krishna Rao
R/o. 2-2-1137/4/A,
New Nallakunta,
Hyderabad. *** O.P. No. 7
11. P. S. Bhasker Rao
S/o. Chalapathi Rao
C/o. M/s. M. Kalyana Ramakrishna & Co.
Advocates, A-31, Indian Airlines
Employees Colony, Opp. Airport
Begumpet, Secunderabad-500 003. *** O.P. No. 8.
(R5 to R11 are not necessary parties)
F.A. 209/2006 against C.C 575/2003, Dist. Forum-II, Hyderabad.
Between:
1. M. Madan Mohan Rao
S/o. M. L. Narasimham
D.No. 12-2-823/A/30,
Santoshnagar
Mehidipatnam
Hyderabad-500 028. *** Appellant/
O.P. No. 3
2. Capt. K. Kishan
S/o. Late Yellaiah
Age: 45 years
R/o. Plot No. 609
Naveen Nagar Colony
Banjara Hills, Hyderabad *** Appellant/
O.P. No. 5
Vs.
1. V. V. Rama Narasaiah
S/o. Late Rangaiah
Retd. Employee
2. Smt. V. Amruta Bai
W/o. V. V. Rama Narasaiah
3. V. Prabhakar Rao
S/o. V. V. Rama Narsaiah
4. Smt. V. Sarala,
W/o. V. Prabhakar Rao
All are R/o. H.No. 10-2-287/1/1
Shantinagar, Hyderabad. *** Respondents/
Complainants
5. M/s. Abheeshta Finance Company
Flat No. 117, Sovereign Shelters
Behind Ganga Jamuna Hotel
Lakdikapool, Hyderabad. *** O.P. No. 1
6, A.P.V. Subbaiah, S/o. Late Rangaiah
R/o. D-81, Madhura Nagar
S.R. Nagar, Hyderabad-38. *** O.P. No. 2.
7. M. Sreenivas
S/o. M. V. Sastry
R/o. 12-2-823/A/28
Geeta Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 4
8. Smt. K. Vijaya Lakshmi
W/o. K. Shiva Kumar
R/o. 2-2-647/49,
Central Excise Colony
Nallakunta
Hyderabad-500 013. *** O.P. No. 6.
9. N. Venkateswara Rao
S/o. Late N. Krishna Rao
R/o. 2-2-1137/4/A,
New Nallakunta,
Hyderabad. *** O.P. No. 7
10. P. S. Bhasker Rao
S/o. Chalapathi Rao
R/o. B-31, F-4,
Vijayanagar Colony, Hyderabad. *** O.P. No. 8.
(R5 to R10 are not necessary parties)
F.A. 141/2006 against C.C 575/2003, Dist. Forum-II, Hyderabad.
Between:
Smt. K. Vijaya Lakshmi
W/o. K. Siva Kumar
R/o. 2-2-647/49,
Central Excise Colony
Nallakunta
Hyderabad-500 013. *** Appellant
O.P. No. 6.
Vs.
1. V. V. Rama Narasaiah
S/o. Late Rangaiah
Retd. Employee
2. Smt. V. Amruta Bai
W/o. V. V. Rama Narasaiah
3. V. Prabhakar Rao
S/o. V. V. Rama Narsaiah
4. Smt. V. Sarala,
W/o. V. Prabhakar Rao
All are R/o. H.No. 10-2-287/1/1
Shantinagar, Hyderabad. *** Respondents/
Complainants
5. M/s. Abheeshta Finance Company
Flat No. 117, Sovereign Shelters
Behind Ganga Jamuna Hotel
Lakdikapool, Hyderabad. *** O.P. No. 1
6. A.P.V. Subbaiah
S/o. Late Rangaiah
R/o. D-81, Madhura Nagar
S.R. Nagar, Hyderabad-38. *** O.P. No. 2.
7. M. Madan Mohan Rao
S/o. M. L. Narasimham
D. No. 12-2-823/A/28,
Geetha Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 3
8. M. Sreenivas
S/o. M. V. Sastry
R/o. 12-2-823/A/28
Geeta Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 4
9. . Capt. K. Kishan
S/o. Late Yellaiah
R/o. Plot No. 609
Naveen Nagar Colony
Banjara Hills, Hyderabad *** O.P. No. 5
10. N. Venkateswara Rao
S/o. Late N. Krishna Rao
R/o. 2-2-1137/4/A,
New Nallakunta,
Hyderabad. *** O.P. No. 7
11. P. S. Bhasker Rao
S/o. Chalapathi Rao
R/o. B-31, F-4,
Vijayanagar Colony, Hyderabad. *** O.P. No. 8.
(R5 to R11 are not necessary parties)
F.A. 108/2009 against C.C 575/2003, Dist. Forum-II, Hyderabad.
Between:
M. Sreenivas
S/o. M. V. Sastry
R/o. 12-2-823/A/28
Geeta Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** Appellant/
O.P. No. 4
Vs.
1. V. V. Rama Narasaiah
S/o. Late Rangaiah
Retd. Employee
2. Smt. V. Amruta Rao
W/o. V. V. Rama Narasaiah
3. V. Prabhakar Rao
S/o. V. V. Rama Narsaiah
4. Smt. V. Sarala,
W/o. V. Prabhakar Rao
Age: 40 years
All are R/o. H.No. 10-2-287/1/1
Shantinagar, Hyderabad. *** Respondents/
Complainants
5. M/s. Abheeshta Finance Company
Flat No. 117, Sovereign Shelters
Behind Ganga Jamuna Hotel
Lakdikapool, Hyderabad. *** O.P. No. 1
6. A.P.V. Subbaiah
S/o. Late Rangaiah
R/o. D-81, Madhura Nagar
Hyderabad-500 038. *** O.P. No. 2.
7. M. Madan Mohan Rao
S/o. M. L. Narasimham
D. No. 12-2-823/A/28,
Geetha Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 3
8. . Capt. K. Kishan
S/o. Late Yellaiah
R/o. Plot No. 609
Naveen Nagar Colony
Banjara Hills, Hyderabad *** O.P. No. 5
9. Smt. K. Vijaya Lakshmi
W/o. K. Siva Kumar
R/o. 2-2-647/49,
Central Excise Colony
Nallakunta
Hyderabad-500 013. *** O.P. No. 6.
10. N. Venkateswara Rao
S/o. Late N. Krishna Rao
R/o. 2-2-1137/4/A,
New Nallakunta,
Hyderabad. *** O.P. No. 7
11. P. S. Bhasker Rao
S/o. Chalapathi Rao
R/o. B-31, F-4,
Vijayanagar Colony, Hyderabad. *** O.P. No. 8.
(R5 to R11 are not necessary parties)
F.A. 113/2009 against C.C 575/2003, Dist. Forum-II, Hyderabad.
Between:
P. S. Bhaskar Rao
S/o. Chalapathi Rao
R/o. 96/3RT, Vijayanagar Colony
Hyderabad-500 028. *** Appellant/
O.P. No. 8.
Vs.
1. V. V. Rama Narasaiah
S/o. Late Rangaiah
Retd. Employee
2. Smt. V. Amruta Bai
W/o. V. V. Rama Narasaiah
3. V. Prabhakar Rao
S/o. V. V. Rama Narsaiah
4. Smt. V. Sarala,
W/o. V. Prabhakar Rao
All are R/o. H.No. 10-2-287/1/1
Shantinagar, Hyderabad. *** Respondents/
Complainants
5. M/s. Abheeshta Finance Company
Flat No. 117, Sovereign Shelters
Behind Ganga Jamuna Hotel
Lakdikapool, Hyderabad. *** O.P. No. 1
6. A.P.V. Subbaiah
S/o. Late Rangaiah
R/o. D-81, Madhura Nagar
Hyderabad-500 038. *** O.P. No. 2.
7. M. Madan Mohan Rao
S/o. M. L. Narasimham
D. No. 12-2-823/A/28,
Geetha Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 3
8. M. Sreenivas
S/o. M. V. Sastry
R/o. 12-2-823/A/28
Geeta Apartments
Santoshnagar, Mehidipatnam
Hyderabad-500 028. *** O.P. No. 4
9. Capt. K. Kishan
S/o. Late Yellaiah
R/o. Plot No. 609
Naveen Nagar Colony
Banjara Hills, Hyderabad *** O.P. No. 5
10. Smt. K. Vijaya Lakshmi
W/o. K. Siva Kumar
R/o. 2-2-647/49,
Central Excise Colony
Nallakunta
Hyderabad-500 013. *** O.P. No. 6.
11. N. Venkateswara Rao
S/o. Late N. Krishna Rao
R/o. 2-2-1137/4/A,
New Nallakunta,
Hyderabad. *** O.P. No. 7
(R5 to R11 are not necessary parties)
Counsel for complainants: M/s. V. Gourisankara Rao
Counsel for O.P3 & O.P5 M/s. G. Rajesham
Counsel for O.P.4 & O.P8 M/s. M. Kalyana Ramakrishna
Counsel for O.P6 & O.P7 M/s. A. Suryanarayana Murthy
QUORUM:
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
&
SMT. M. SHREESHA, MEMBER
THURSDAY, THE FIFTH DAY OF FEBRUARY TWO THOUSAND AND NINE
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
*****
1) These appeals relate to Fixed Deposit Receipts (FDRS) issued by Opposite Party No. 1 M/s. Abheeshta Finance Company, a partnership firm to various deposit holders. These appeals arise out of order of the Dist. Forum-II, Hyderabad in C.D. 575/2003 and all the appeals can be conveniently disposed of by a common order, as they arise from the same order.
2) The parties are described as arrayed in the complaint for felicity of expression.
3) The case of the complaints in brief is that Opposite Party No. 1 is a partnership firm and the Opposite Parties 2 and 3 are managing partners. Opposite Party No. 1 engaged in finance business viz., lending monies for interest and receiving fixed deposits. Complainant No. 2 is the wife of complainant No. 1 and complainants 3 & 4 are son and daughter-in-law respectively. They deposited various amounts under FDRS during the years 1998 – 2001 and the maturity period being one year. Opposite Party No. 1 issued FDRS agreeing to pay the amount with interest @ 14% p.a. on maturity. The details of FDRS are as follows:
| S.No. | Name | FDR No. | Date | Amount | Maturity Date |
| 1 | V.V.Rama Narasaiah | 125 | 05.02.1998 | 50,000/- | 05.02.1999 |
| 2 | V.V.Rama Narasaiah | 147 | 16.12.1998 | 50,000/- | 16.12.1999 |
| 3 | V.V.Rama Narasaiah | 187 | 04.07.1999 | 62,000/- | 04.07.2000 |
| 4 | V.V.Rama Narasaiah | 275 | 06.12.2001 | 1 lakh | 06.12.2002 |
| 5 | Smt. V. Amrutha Bai | 124 | 05.02.1998 | 50,000/- | 05.02.1999 |
| 6 | Smt. V. Amrutha Bai | 230 | 08.12.1999 | 50,000/- | 08.12.2000 |
| 7 | Smt. V. Amrutha Bai | 176 | 17.04.1999 | 50,000/- | 17.04.2000 |
| 8 | Smt. V. Amrutha Bai | 076 | 11.12.1998 | 1 lakh | 11.12.1999 |
| 9 | V. Prabhakar Rao | 145 | 16.12.1999 | 50,000/- | 16.12.2000 |
| 10 | V. Sarala & V. Prabakar Rao | 146 | 16.12.1998 | 1 lakh | 16.12.1999 |
When they demanded they failed to pay the amounts, except interest on some deposits up to December, 2000 and November, 2001. They also paid Rs. 1,00,000/- towards principal. When notice was issued calling upon them to pay the amount, Opposite Party No. 2 gave reply stating that he was no way connected with the firm as he resigned on 1.4.2000. When they deposited the amounts he was a partner. Therefore they claimed the amounts covered the FDRS with interest @ 24% p.a., together with compensation and costs.
4) Opposite Party No. 1 a partnership firm represented by one Sri P. S. Bhasakar Rao filed counter alleging that they did not induce the complainants to deposit the amounts as alleged by them. The amounts covered under the FDRs were received by the complainants. There was no outstanding pending in the accounts maintained by it. The complainants were informed several times to come to its office and verify the accounts but they have not responded. Therefore it prayed for dismissal of the complaint.
5) Opposite Party No. 2 filed counter resisting the case. He stated that he was the Honorary Managing Director of M/s. Abheeshta Finance Pvt. Ltd., a company incorporated under the provisions of Indian Companies Act in the month of October, 1993. Subsequently the firm Opposite Party No. 1 was constituted on 12.5.1994 followed by another under name and style M/s. Abheeshta Chits (P) Ltd. All the three belong to the self same institution, the management of which has been in the hands of Board of Directors of M/s. Abheeshta Finance Pvt. Ltd. Clause 8 of the Partnership Deed shows that the business of the partnership may be carried on either in firm’s name or in the name of M/s. Abheeshta Finance (P) Ltd. Since the accounts of the business were not maintained correctly, and having suspected foul play he resigned as partner of Opposite Party No. 1 firm as well as director of the company. On that he was replaced by Sri N. Krishna Rao by Board Resolution Dt. 26.9.1998. He was no way concerned with Opposite Party No. 1 firm. The so called renewals were made subsequent to the expiry of limitation and therefore they were not valid. Therefore he prayed for dismissal of the complaint.
6) Opposite Parties 3, 4 and 5 did not file any counter.
7) Opposite Party No. 6 filed counter alleging that entire firm was managed and controlled by Sri M.V. Sastry father of Opposite Party No. 4, and Sri P. S. Bhaskar Rao his brother-in-law (O.P. No. 8) and the auditor of the firm Sri V. Sridhar his nephew. Her husband who was attending on her behalf insisted for authenticated accounts. They failed to furnish the same. On that she retired from the firm and the same was intimated to the Registrar of Firms on 1.6.2002 and her name was deleted from the list of partners. On 28.9.2002 there was a meeting wherein the firm was taken over by M. Srinivas, M. Madan Mohan Rao, K. Kishen, and P.S. Bhaskar Rao. There was no liability on her part. The claim was barred by limitation. Therefore she prayed for dismissal of the complaint.
8) Opposite Party No. 7 resisted the case reiterating the facts alleged by Opposite Party No. 6 in her counter. He alleged that he had nothing to do with the partnership firm. He was neither a director of the company nor a partner of the firm. After the death of his father, Sri M.V.S. Sastry requested him to assist Sri P.S. Bhaskar Rao in collecting the amounts due from debtors of the firm. Later he had withdrawn his consent, and therefore he prayed for dismissal of the complaint.
9) The complainant No. 1 filed affidavit evidence on behalf of complainants and got Exs. A1 to A9 and A12 FDRs marked. Refuting their evidence Opposite Parties 2 & 6 filed their affidavit evidence and got Exs. B1 to B18 marked.
10) The Dist. Forum after considering the evidence placed on record opined that Opposite Party No. 7 was not shown either as director or as partner, and therefore the complaint was dismissed against him. Since Opposite Parties 3, 4 and 5 did not file counter and the names of Opposite Parties 1, 2, 6 and 8 do find a place in the documents issued by Registrar of Companies, and they could not file any document to show that their names were deleted from Opposite Party No. 1 company as directors, directed the opposite parties 1 to 6 and 8 to pay the amounts covered under the FDRS with interest together with compensation of Rs. 60,000/- and costs of Rs. 1,000/-.
11) Aggrieved by the said decision, Opposite Parties 2, 3, 5 and 6 preferred appeals and along with them, the Opposite Party No. 4 & 8 preferred appeals with delay petitions alleging that the Dist. Forum did not appreciate any of their contentions. It was erred in treating Opposite Party No. 1 as a company, while in fact it was a partnership firm. This resulted in invoking wrong interpretation of law leading to miscarriage of justice. The order was passed without appreciating the liability of each of the opposite party. Neither the question of limitation nor the maintainability of the complaint before the Dist. Forum was not even considered. Therefore they prayed that the appeals be allowed and set-aside the order of the Dist. Forum.
12) Since the appeals preferred by other parties are being heard, we are of the opinion that the delay petition filed by Opposite Parties 4 & 8 could be condoned. The appeals preferred by Opposite Party No. 4 & 8 could also be taken for hearing along with other appeals lest contrary and conflicting orders might be passed, which would lead to unnecessary litigation, and multiplicity of proceedings.
13) The complainants claimed the amounts deposited under various FDRs issued by Opposite Party No. 1 a partnership firm dealing in money lending business. The complaint was silent as to the person who among the opposite parties had issued the FDRs. A perusal of FDRs issued by the firm discloses that some of the FDRs were signed by one of the partners as well as Managing Partner and some of the FDRs were issued by director and Managing Director of M/s. Abheeshta Finance Pvt. Ltd. To be more precise Exs. A1 to A6 and A8 to A12 were issued by Partner and Managing Director of M/s. Abeeshta Finance Company and Ex. A7 was issued by Director & Managing Director of M/s. Abheeshta Finance Pvt. Ltd. ‘Extensions’ were made from 5.2.1999, 16.12.1999, 4.7.2000,17.4.2000 on the FDRs maintaining that it was signed by the authorized signatory. The person who signed it was not known nor his authority was mentioned in the pleadings. In Ex. A3 it was extended to 4.7.2001 and later to 4.7.2002. It was not known who extended it. Ex. A4 bears endorsement with words of ‘auto renewal’. The date of maturity was 5.2.1999. Despite said endorsement the authorized signatory extended it repeatedly up to 5.2.2002. Ex. A6 was “extended” up to 19.6.2002. Ex. A7 bears the both endorsements of “Auto Renewal” and “extended up to” 11.12.200, 11.12.2001 and 11.12.2002. Ex. A8 bears the endorsement that it was “extended” up to 16.6.2002. Under Ex. A12 the date of maturity was shown as 6.12.2002 but it was not extended.
14) When the complainant has issued a notice under Ex. A10 for refund of the amount, it was alleged that the opposite parties are “Board of Directors of the company”. Curiously the same was repeated in Ex. A11. The fact that said notice was served on them was not evidenced by any acknowledgement. We reiterate that the case was filed against opposite party No. 1, describing it as partnership firm and others are partners.
15) The opposite parties/appellants resisted the case stating that M/s. Abheeshta Finance Pvt. Ltd., a private limited company is also a partner having 40% of share in Opposite Party No. 1 firm evidenced under Ex. B9. Neither the company was impleaded as a party nor its directors, obviously, the
complainants were unaware of the status whether opposite party No. 1 is a partnership firm or a private limited company.
16) A perusal of the documents filed by the appellants would undoubtedly indicate that M/s. Abheeshta Finance Pvt. Ltd., a company registered under the Companies Act, 1956 was constituted on 15.9.1993 consisting of following Directors evidenced under Ex. B6.
1. Avula Peda Venkata Subbaiah, S/o. Late Rangaiah
2. Moduga Madan Mohan Rao, S/o. Late M.L. Narasimham
3. Mylavarapu Srinivas, S/o. M. V. Sastry
4. Kanuganti Kishan, S/o. Late K. Yellaiah
5. Kaparti Vijaya Laxmi, W/o. K. Shiva Kumar.
Later a partnership firm the opposite party No. 1 under the name and style of M/s. Abheeshta Finance Company was constituted on 12.5.1994 with the following partners evidenced under Ex. B9.
1. Avula Peda Venkata Subbaiah, S/o. Late Rangaiah
2. Moduga Madan Mohan Rao, S/o. Late M.L. Narasimham
3. Mylavarapu Srinivas, S/o. M. V. Sastry
4. Kanuganti Kishan, S/o. Late K. Yellaiah
5. Kaparti Vijaya Laxmi, W/o. K. Shiva Kumar.
6. N. Krishna Rao, S/o. Late Veeraswamy.
7. M/s. Abheeshta Finance Private Limited.
17) We may clarify herein that M/s. Abheeshta Finance Private Limited, a company incorporated under the Companies Act was made as a partner to the partnership firm having 40% share vide Ex. B9 Dt. 12.5.1994. Opposite Party No. 1 was incorporated with the same nomenclature under the provisions of Indian Companies Act, 1956 came into existence on 23.4.1999 on conversion of M/s. Abheeshta Finance (P) Ltd with the name ‘ M/s. Abheeshta Chit Funds (P) Ltd.
Clause 7 of the Partnership Deed reads as follows :
“The an account/s may be opened in any bank/s in the name of the partnership firm and such account/s shall be operated under the join signatures of Sri P.S. Bhaskar Rao who is hereby authorized to operate the account/s and any one of the partners namely Sri A.P.V. Subbaiah, Sri M. Madan Mohan Rao and Sri M. Srinivas.
18) The complainant did not implead M/s. Abheeshta Finance Pvt. Ltd., one of the partners of Opposite Party No. 1. The complainants had filed the complaint against the firm, without mentioning who was representing the firm. It is settled proposition of law that Partnership is not a legal entity, like a company, it is a group of individual partners¹. The firm name is only a compendious name given to the partnership, and the partners are real owners of assets². A partnership firm is not a distinct entity and the partnership property belongs to all the partners constituting the firm³.
1. Comptroller & Auditor General Vs. Kamlesh Vadilal Mehta (2003) 2 SCC 349.
2. N. Khandervali Saheb Vs. N. Gudu Saheb, ( 2003) 3 SCC 229.
3. Malabar Fisheries Co. Vs. I.T. Commissioner, Kerala AIR 1980 SC 176.
19) We may also state that one partner cannot represent on behalf of all the partners, particularly renewing the deposit which was time barred, unless there is an express authority given by all the parties. It is not known whether all the partners have issued these FDRS with a view to bind the firm and signed with the seal of the firm, had the complainant proved that the Managing Partner has executed the bond and therefore the other partners of the firm were also liable, it would have been different.
20) It is settled law that a partner is under no liability to the firm in respect of the debts subsequently incurred by other partners at the time when he was not a partner. The firm cannot be held liable for an act done by a partner, if such act is beyond the scope of the apparent authority of such partner.
21) We may also state herein that the case of Opposite Party No. 2 & 6 was that they were retired and therefore they were not liable. The complainants contend that no publication or notice as required u/s 32 of the Indian Partnership Act, 1932 was issued and therefore the said retirement has no affect. The appellant contended that a partner who had retired was not liable, even if no public notice of retirement was given if creditors were informed individually. He further contended that even the knowledge of retirement provided to the agent of the creditor on whose behalf the agent dealt with would remain binding on the creditor. He contended that Opposite Party No. 8 having admitted that he dealt with the deposits of the complainants herein on their behalf, and having knowledge it would bind on the complainants. In support of his contention he relied the decision in Jain Nautumal Vs. Wadhwan & Sri Vivenkanand Co-operative Housing Society reported in AIR 1986 Guj. 162 and ‘C. Assiamma Vs. State Bank of Mysore’ reported in AIR 1990 Ker. 157.
Undoubtedly a partner who has retired is not liable even if no public notice of his retirement has been given. We may add that without dissolving the firm and continuing the ongoing business a partner may retire from the partnership, a situation clearly comprehended by Section 32 of Indian Partnership Act, 1932.
22) The complainants did not adduce any evidence as to whom among the partners paid the amounts and obtained receipts. It is not known who on behalf of the firm was issuing receipts or endorsing the FDRs It is as vague as vagueness could be. This enquiry was necessitated, in view of the fact that, none of the opposite parties admitted that they were responsible for the administration of the firm or that they have anything to do with it. The appellants filed Ex. B5 Form-A from Registrar of firms to show as to the names of the partners and other relevant data. No doubt there were interse disputes among the partners of the firm. Opposite Party No. 2 alleges that he severed connections with the erstwhile firm and has nothing to do with the present firm evident from Ex. B18. His own notice under Exs. B11 and B12 mentioned that he resigned as director/partner and the same was accepted. Despite such an evidence being produced, the complainants did not bother to file any contra evidence. The complainant ought to have taken Forum-A to show the names of the partners as on the date of complaint to fasten the liability.
23) We may state herein that evidently the proceedings under the Consumer Protection Act are summary in nature. If contentious issues of foregone conclusions are raised the consumer fora may not be able to determine such complicated questions, necessarily it has to direct the parties to approach the Civil Court for adjudication. At any rate the Dist. Forum was undoubtedly erred in thinking that Opposite Party No. 1 is a company and
Opposite Parties 2 to 7 are directors invoking the provisions of Indian Company Act, and directed the directors to pay the amount personally forgetting the fact that M/s. Abheeshta Finance Pvt. Ltd., holding 40% share in the firm is a company, where the liability of the directors is limited. They have no personal liability to pay the said amount.
24) With the scanty evidence placed by the complainants, not keeping track as to the exact partners and directors whom they can implead, filed a complaint as though it was a company, and that ‘the directors’ are liable personally to pay the amount.
25) The question of liability of Opposite Party No. 2 vis-à-vis his resignation, and subsequent constitution of firm and company cannot be gone into, in view of the fact that the complainant did not file the very essential document Viz., Form-A of the firm as on the date of filing of the complaint An Incorporation of the Company and the Directors and others who were responsible for the administration of the company.
26) The contention of Opposite Party No. 6 is that she was neither a director nor was a partner. In Ex. B9 partnership deed admittedly she was shown as partner. However, a perusal of Ex. B5 form-A of Registrar of Firms shows that she was ceased to be a member from 1.6.2002 noted under the coloumn date of ceasing. The complainant could not explain as to how she was liable to pay the amount when she ceased to be a partner with effect from 1.6.2002. It also shows that there was a change in the constitution of the firm with effect from 28.6.2002. It is not known who was taken as a partner in place of opposite party No. 6.
27) To sum up the Dist. Forum has undoubtedly mis-appreciated the fact that it was a company that was liable to pay though the complainants have filed the case against a partnership firm. They did not implead the company which is also a partner of the firm. Therefore, the complaint without impleading all the partners and those partners that were retired were made as parties and some of them died, cannot be held maintainable. More so by way of summary disposal.
28) The Dist. Forum did not address to the question of limitation and as to how such an endorsement would save limitation. Even when the opposite parties disputed these endorsements and the person who signed had no authority, the complainants did not expatiate while filing the affidavit evidence. At the cost of repetition, it may be stated that endorsement of renewal was not made by any of these appellants though they were authorized to operate the accounts.
29) In the light of contentions taken by the opposite parties and particularly in view of the fact that there was no endorsement acknowledging the liability and the authority of the person who made endorsements, we believe that such an endorsement would not extend the limitation and the person who made such an endorsement has the authority. In the light of various contentions taken by the opposite parties that some of them have retired and others had no concern whatsoever we are of the opinion that these questions could not be determined in summary proceedings under the Consumer Protection Act. It is not a straight case where the amounts were collected under the FDRs which could be directed to be paid. Serious questions of fact and law including that of collusion etc. were raised, we believe that this is a fit case where Civil Court could go into these questions and determine the matter. The Dist. Forum did not advert to any of the contentions raised by the appellants in this regard.
We believe that these contentions could not be gone into with the scanty evidence placed by the complainant. For the FDRs issued in the year 1998, they filed the complaints in 2003, beyond the period of limitation. The plea is that there were renewals without amplifying as to the date of renewals. The complainants could not prove who among these appellants signed acknowledgements under the FDRs.
30) Having considered the entire evidence placed on record, we are of the opinion that the appeals have to be allowed setting aside the order of the Dist. Forum.
31) In the result the appeals are allowed setting aside the order of the Dist. Forum. Consequently the orders passed against the appellants are set-aside. However, in the circumstances of the case each party to bear its own costs.
PRESIDENT LADY MEMBER
Dt. 05. 02. 2009.
*pnr
“UP LOAD – O.K”
