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NT Agro Food Products & Others v/s State of West Bengal & Others

    A.S.T. No. 347 of 2014 with A.S.T.A. No. 249 of 2014 with C.A.N. No. 10535 of 2014 (Appellate Side)

    Decided On, 17 November 2014

    At, High Court of Judicature at Calcutta

    By, THE HONOURABLE MR. JUSTICE JYOTIRMAY BHATTACHARYA & THE HONOURABLE MR. JUSTICE TAPASH MOOKHERJEE

    For the Appellants: Saktinath Mukherjee, Sr. Adv., Debabrata Saha Roy, Pringal Bhattacharya, Chandrachur Chatterjee, Advocates. For the Respondents: Kalyan Bandopadhyay, Sr. Adv., Sushovan Sengupta, Subir Pal, Advocates.



Judgment Text

Jyotirmay Bhattacharya, J.

This Mandamus Appeal is directed against the judgment and/or order passed by a learned Single Judge of this Court on 22 July, 2014 in W.P. No.20911(W) of 2014 at the instance of the writ petitioner.

By the impugned order, the appellants’ writ petition was dismissed. Let us now consider the legality and/or propriety of the impugned order in the facts of the instant case. The appellant No.1 is a partnership firm comprising of 3 partners being appellant Nos. 2, 3 and 4 respectively.

The appellant No.2 is also M.R distributor under the West Bengal Public Distribution System (Maintenance & Control) Order, 2013. The appellant firm made an application for selection of Roller Flour Mills/Chakki Mill Operator for conversion of wheat (BPL/APL) into fortified atta/Whole meal atta pursuant to notice inviting application dated 4th September, 2013 issued by the respondent authority. The appellant No.1 was not selected by the respondent authority by applying the prohibitory Clause 15 of the notice inviting application as the appellant No.2, a partner thereof is already a distributor under the Control Order, 2013. For convenience of understanding we feel it necessary to set out Clause 15 of the said notice inviting tender as the fate of this appeal depends upon the interpretation of the said Clause 15 of the notice inviting application. Clause 15 of the notice inviting application reads as follows:-

'Any person as proprietor/partner/director holding M.R distributorship/dealership/licence shall not be entitled to apply for selection of his Roller Flour Mills/Chakki Mill in the above mentioned capacity under the scheme of conversion of wheat into atta'.

The learned Trial Judge, after taking into consideration the said prohibitory clause, held that when one of the partners held the distributorship under the Control Order, 2013 and had signed the application of the petitioner No.1/appellant No.1 firm as a partner thereof, the rejection of such application in view of Clause 15 cannot be said to be incorrect.

Let us now consider as to how far the learned Trial Judge was justified in coming to such a conclusion in the light of the prohibitory provision contained in Clause 15 of the notice inviting application. In this connection we have considered the said prohibitory clause with great anxiety and minutely to extract the true purport of the said prohibitory clause. If we read the said provision in the manner as it is framed then it appears to us that if a proprietor of a proprietorship concern or if a partner of a partnership firm or if a director of a company holds M.R distributorship/dealership/licence, he shall not be entitled to apply for selection of his Roller Flour Mills/Chakki Mill in the above mentioned capacity under the scheme of conversion of wheat into atta.

Since we are presently concerned with a partnership firm, let us discuss the present problem with reference to a partnership firm. Suppose there are three partners in a partnership firm. Say for example A, B and C are the partners of a partnership firm and the partnership firm is described as D and one of the partners of such partnership firm D namely partner B holds M.R distributorship/dealership/licence then in view of the prohibitory provision contained in Clause 15, the said partner, namely, B cannot apply for selection of 'his' Roller Flour Mills/Chakki Mill in the above mentioned capacity; meaning thereby as a partner of the said partnership firm, he cannot individually apply for his own selection under the scheme of conversion of wheat into atta. To be more specific, when a partner of a partnership is having M.R distributorship/dealership/licence, he as a partner of the said partnership firm cannot apply for selection of his Roller Flour Mills/Chakki Mill under the said scheme. The expression 'his' appearing in the said clause is significant in the present context as the expression 'his' relates to an individual partner and not to the partnership firm. Had there been any intention to exclude the partnership firm, then the said prohibitory provision ought to have been couched in a different way by creating a bar on a partnership firm to apply for selection of its Roller Flour Mills/Chakki Mill when one of its partner is having M.R distributorship/dealership/licence. In our reading, the exclusion part is applicable to the individual partner who is having M.R distributorship/dealership/licence so that he cannot apply for his own selection to enjoy the benefit of the said scheme. The said provision does not exclude the partnership to apply for selection of 'its' Roller Flour Mills/Chakki Mill even though the partner of such partnership firm is holding M.R distributorship/dealership/licence.

As per Section 4 of the Partnership Act, 'partnership' is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. It is true that partners cannot be segregated from the partnership as it is an association of persons and the firm has no legal existence. (AIR 1965 SC 1411 M/s. Kylasa Sarabhaiah –Vs- I-T Commr).

Whatever property is brought by the partners when the partnership is formed or which may be acquired in course of the business of the partnership it becomes the property of the firms and what a partner is entitled to is his share of profit, if any, accruing to the partnership from realization of this property and upon dissolution of partnership to a share in the money representing the value of the property. (AIR 1966 SC 1300 Addanki Narayanappa & Anr. –Vs- Bhaskara Krishtappa and Ors.).

No doubt, since a firm has no legal existence, the partnership property will vest in all the partners and in that sense every partner has an interest in the property of the partnership but during the subsistence of the partnership, however, no partner can deal with any portion of the property as his own nor can be assign his interest in a specific item of the partnership property to anyone.

Thus, if any licence is granted in favour of the partnership firm such licence will be an asset of the partnership firm with which no individual partner can deal with by treating such licence as an asset as his own. Thus, in case of grant of licence, the partner who is holding M.R distributorship cannot reap the benefit of such licence as his own property, rather the association of all the partners will collectively enjoy the benefit of such licence. As such the partnership cannot be held to be disentitled to apply for such licence, even though one of its partner is holding such licence in his individual capacity.

A partnership firm may be represented by anyone of the partners of the partnership firm, if any act is done and/or performed by a partner in the name of the partnership firm. If such be the position of a partner in relation to a partnership firm under the Indian Partnership Act, 1932 then any individual partner representing the partnership firm may apply for its viz. the firm’s selection in terms of the said notice inviting application. Think about a situation where a partner who is not holding M.R distributorship/dealership/licence, representing the partnership firm applies for its selection in terms of the said notice inviting application, can it be said that the said partnership firm is not entitled to apply in view of Clause 15 of the said notice inviting application even though the other partner who is holding distributorship has not signed the application. In this context, we cannot hold that the partnership firm is disentitled to apply for its selection as one of its partner is holding M.R distributorship/dealership/licence as per Clause 15 of the said notice inviting application. Thus, in the context of the above discussion we cannot agree with the conclusion drawn by the learned Trial Judge in the impugned order.

We hold that the concerned authority was not justified in rejecting the application of the petitioner No.1. by applying Clause 15 of the notice inviting application in the facts of the instant case. We, thus set aside the impugned order and allow the writ petition by directing the concerned

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authority to select and/or empanel the petitioner No.1 firm as Flour Mill/Chakki Mill in Hooghly District, pursuant to the notice inviting application dated 4th September, 2013 issued by the Special Secretary, Government of West Bengal, Food and Supply Department if he is otherwise eligible and allow the writ petitioner’s Flour Mill/Chakki Mill to run its Flour Mill/Chakki Mill business by way of executing the agreements and making allotments of BPL/APL wheat for converting the same into atta fortified atta thereof. The Mandamus Appeal is, thus, allowed. In view of the disposal of the appeal, no further order need be passed on the application. The application, thus, be treated as disposed of. Urgent photostat certified copy of this order, if applied for, be given to the parties as expeditiously as possible. Tapash Mookherjee, J. I agree.
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