In CR No.3446 of 2021 (O&M)-PUNJ HC- Under Order VII Rule 11 CPC, alleged violation of Indian Partnership Act cannot be gone into by Court without evidence being led especially when no ground mentioned in such provision stands established: P&H HC Justice Alka Sarin [31-05-2022]

Read Order: M/s Shimla Mandi Goods Transport Pvt. Ltd. and Others v. Jitender Gupta, Proprietor M/s Simla Mandi Goods Transport Company

Monika Rahar

Chandigarh,June 1, 2022: While dealing with a revision petition filed by the defendants in a trademark infringement suit against the dismissal of their application for rejection of plaint, the Punjab and Haryana High Court has held that on an application under Order VII Rule 11 CPC, the alleged violation of the provisions of the Indian Partnership Act, 1932 cannot be gone into by the Court without any evidence having been led especially when on a meaningful reading of the plaint none of grounds mentioned in Order VII Rule 11 CPC were established. 

The Bench of Justice Alka Sarin has held, “It is trite that on an application under Order VII Rule 11 CPC only the contents of the plaint along with the documents filed with the plaint are to be seen. Neither the written statement nor the averments made in the application can be considered for rejecting the plaint under Order VII Rule 11 CPC.”

The Court was called upon to decide a civil revision preferred by the defendant-petitioners impugning the order of the District Judge, Panchkula whereby the application filed by them under Order VII Rule 11(d) read with Section 151 of the Code of Civil Procedure, 1908 (‘CPC’) was dismissed.

The brief facts relevant to the present lis are that the plaintiff-respondent, proprietor of M/s Simla Mandi Goods Transport Company engaged in transportation services, filed a civil suit for injunction for restraining the defendant-petitioners from passing off, infringement of trademark, infringement of copyright, acts of unfair competition, dilution, rendition of accounts, damages, etc. 

It was alleged that the second and the third defendant-petitioners started a new company under the name and style of “Shimla Mandi Goods Transport Pvt. Ltd.” (the first defendant-petitioner) to start a new business under an identical name to that of the transport firm of the plaintiff-respondent. It was their allegation that they (defendants) copied the entire get-up, lay out, overall appearance and all the unique features of the business of the plaintiff-respondent.

The defendant-petitioners filed an application for rejection of the plaint under Order VII Rule 11(d) CPC stating therein that the plaintiff-respondent wrongly claimed himself to be the sole proprietor of M/s Simla Mandi Goods Transport Company (Regd.) as his brother was also one of the partners with 50% share. On his death, the petitioner’s brother  left behind three legal heirs i.e. his wife, son and daughter and thus the defendants claimed that the plaintiff failed to disclose as to how he assumed the status of sole proprietor of the firm. According to the defendant-petitioners, the suit was in contravention of the provisions of the Indian Partnership Act, 1932 and was barred by law. 

Reply to the application under Order VII Rule 11 CPC was filed by the plaintiff-respondent. However, before the application under Order VII Rule 11 CPC could be disposed of, the legal heirs of the deceased partner moved an application under Order I Rule 10 CPC for being impleaded as a party to the suit. 

While dismissing both the applications vide the impugned order, the District Judge, Panchkula observed that the legal representatives of the deceased filed a civil suit before the Delhi High Court for relief of partition, rendition of accounts, declaration besides permanent and mandatory injunction against the defendants therein who included the plaintiff as also his wife and two firms including M/s Simla Mandi Goods Transport Company. However, no interim relief was granted restraining the present plaintiff-respondent from acting as a sole proprietor of the firm. 

The Counsel for the defendant-petitioners contended the plaintiff-respondent had no locus standi to file the suit as a sole proprietor after the death of the other partner since the partnership firm stood dissolved on the death of the second partner. It was further submitted that even the Delhi High Court did not prima facie accept the status of the plaintiff-respondent as a sole proprietor and had therefore passed an interim order. 

Per contra, the senior counsel appearing for the plaintiff-respondent urged that for deciding the application under Order VII Rule 11 CPC only the plaint has to be read. He further submitted that the defendant-petitioners cannot question the locus standi of the plaintiff-respondent to file the suit as sole proprietor and any objection in this respect could only be raised by the heirs of the deceased partner.

On the scope of application for rejection of plaint, the Court observed that a civil court while exercising powers under Order VII Rule 11 CPC is required to see whether the averments as made in the plaint are contrary to statutory law or barred by any law and whether a case is made out for rejecting the plaint at the very threshold. Further, it added that on a meaningful reading of the plaint (and not the written statement or the application), if it is found that the same is vexatious and does not disclose any right to sue or is barred by any law, the Court would exercise its power under Order VII Rule 11 CPC.

Coming to the present case, the Court opined that the grounds for rejection of the plaint as canvassed in the application under Order VII Rule 11 CPC and argued before the Court were not apparent from a meaningful reading of the plaint. The Court added that neither the averments made in the application nor in the written statement can be seen at the time of deciding an application under Order VII Rule 11 CPC.

Further, while reaching the conclusion that no ground for rejection of the plaint was made out, the Court opined that at the threshold, on an application under Order VII Rule 11 CPC, the alleged violation of the provisions of the Indian Partnership Act, 1932 cannot be gone into by the Court without any evidence having been led especially when on a meaningful reading of the plaint none of grounds mentioned in Order VII Rule 11 CPC stand established. 

Also, it was observed that a civil suit was already pending in the Delhi High Court between the legal representatives of the deceased partner, and the plaintiff-respondent and that the issues inter-se the said parties would be gone into in the civil suit pending in the Delhi High Court. 

Accordingly, the revision was dismissed.