Arul Jothi and Co. and 4 others vs Sri Shanmugha Trading Co.

Defendants are the appellants. The suit O.S.No.1414 of 1981 before the District Munsif''s Court, Erode was filed by the respondent against the

appellants for recovery of Rs. 8099.83 due on dealings between the parties. It is not necessary to deal in extenso with the respective contentions

of the parties except to say that the dealings between the parties concluded by October ''75 and the respondent plaintiff wanted to rely on Ex.A.-

24, dated 13.3.1978 to make a claim which was an acknowledgment by the second appellant who was a partner in the first appellant firm. Under

Ex.A-24 a sum of Rs. 50 was paid and according to the respondent the suit filed on 21.10.1980 within three years of Ex.A-24 would be in time.

The appellants resisted the suit on several grounds. The main contention was that the second appellant had not signed any receipt that the

signature in Ex.A-24 was not his and that in any event he had no authority to acknowledge the debt of the firm.

The trial Court found that the signature disputed was actually the signature of the second appellant. However the trial Court found that it had not

been established by the respondent that the second appellant had authority to sign on behalf of the partnership firm first appellant. The trial Court

dismissed the suit by its judgment and decree dated 30.3.1983 on the ground of limitation. The respondent filed appeal A.S.No.70 of 1983 before

the District Court, Periyar District at Erode. The learned District Judge by his judgment and decree dated 19.10.1983 reversed the decision of the

trial Court allowed the appeal and decreed the suit as prayed for with costs. Aggrieved, the present second appeal has been filed.

At the time of admission the following substantial questions of law were raised for decision in the second appeal.

Whether the lower appellate Court has committed an error in holding that the firm and the partners are liable for the suit claim, in the absence of

material to show that the second defendant signed Ex.A-24 in his capacity as a partner and on behalf of the partnership firm.

Whether the lower appellate Court has committed an error in treating the bare signature of the second defendant in Ex.A-24 as an

incontrovertible ac-knowledgment of liability by him on behalf of the partnership firm?

Whether the lower appellate Court has failed to take into consideration the applicability of Section 20(2) of the Limitation Act to the facts of the

case?

Whether the lower appellate Court was right in holding that Section 20(2) of the Limitation Act has no scope of operation in this case?

Miss. Mala, learned counsel for the appellants vehemently contended that there was no material to show that the arrangement between the

parties was open, mutual and running and the acknowledgment in March 1978 could not be in respect of earlier transactions, Unless it was

established that the parties had mutual, open and current account. It should be immediately pointed out that this point was not raised in defence

before the trial Court or was canvassed before the lower appellate Court. It is therefore not open to the appellants to raise a new point for which

no basis at all had been laid before the Courts below. It is next contended by the learned counsel for the appellants that the Courts below had

compared the signature found in Ex.A-24 with the admitted signature of the second appellant and in view of the latest Supreme Court decision

reported in O. Bharatan Vs. K. Sudhakaran and another, this would be a very unsafe method. The learned counsel also pointed out that this

decision had been followed by a learned single Judge of this Court reported in Dhanakodi Padayachi v. Muthukumaraswami 1997 (1) L.W. 402.

The decision of the Supreme court arose under Election proceedings and the Supreme Court held that it was very unsafe in election matters to rely

on mere comparisation of signatures to reach a finding regarding the genuineness of the signature. The case arose under Election proceedings will

not apply to civil proceedings. No doubt, Raju, J. has followed the said decision. A Bench of this Court in Kanthirathinam v. Sajjadi Begum1989

(1) L.W. 552 has referred to the decision of the Supreme Court reported in Murarilal v. State of Madhya PradeshAIR 1980 SC 531 and held that

there is nothing wrong in the Courts themselves making comparison of signatures to ascertain whether the documents in question are genuine or

not. The next contention raised by the learned counsel is that the acknowledgment by the second defendant would not bind the first appellant firm

and its other partners. In support of the contention the learned counsel relied on the judgment of this Court in A. Ramavel Vs. Pandyan

Automobiles Pvt. Ltd., . This was referred to by the Courts below also and as has been rightly pointed out by the lower appellate Court that was a

case in which a cheque payment was made by some third party and the same was sought to be treated as an acknowledgment of liability and this

was not countenanced by the Court. The facts of that case will not apply to the facts of the present case. We have the high authority of a Full

Bench decision reported in Pandiri Veeranna v. Grandhi Veerabhadraswami @ Veerabhadrudu 34 Mad. 373 where there were circumstances

available in the case, to hold that the acknowledgment by a partner could be taken as a valid acknowledgment in the absence of direct evidence of

a specific authority by one partner with regard to the other partner. It has been found by the lower appellate Court that circumstances in the

present case warranted such an inference. The learned District Judge relied on Exs.A-25 to A-32 which were orders for supply of goods from the

plaintiff firm and they were all placed by the second appellant. He had acted on behalf of the first appellant firm and the other partners in placing

orders for supply of goods from the respondent firm. It clearly showed that the second appellant had authority to act and acknowledgment on

behalf of the first appellant firm. Now that it has been held that there was a proper and valid acknowledgment by the second appellant binding the

other appellants and the acknowledgment had been made within three years and the last of the dealings between the parties and the suit having

been filed within 3 years from the date of Ex.A-24, the finding reached by the lower appellate Court that the suit was not barred by limitation has

to be upheld. I have already found that there was enough material to come to the conclusion that the second appellant signed Es.A-24 in his

capacity as a partner and on behalf of the partnership firm, namely, the first appellant.

The acknowledgment in Ex.A-24 would be sufficient acknowledgment of the liability of the appellants to the respondent firm. Consequently all the

substantial questions of law have to be answered against the appellants and the second appeal will stand dismissed. However there will be no

order as to costs.