Ramanujam, J. This appeal filed by the plaintiff in O.S. No. 672 of 1978 on the file of Sub-Court, Coimbatore, is directed against the order, dated 31st January, 1972 in I.A. No. 131 of 1971 of the Court below recording a compromise under Order 23, rule 3 of the Code of Civil Procedure at the instance of the defendants,

2. The, said suit, O.S. No. 672 of 1968. was filed by the plaintiff for recovery of a sum of Rs. 22,158-50 said to be owing from the defendants. While the said suit was pending, the defendants filed I.A. No. 131 of 1971 for recording a compromise said to have been entered into between the plaintiff and the defendants. Under the compromise, the plaintiff is said to have received a sum of Rs. 1,000 and had agreed to receive the balance of Rs. 4,000 in full settlement of the claim as against the defendants. The plaintiff resisted the said application contending that there was no compromise of the suit claim, that the compromise said to have been entered into by one Mohanlal Chainraj who was not a partner of the plaintiff firm was not binding on the plaintiff as he had no authority to represent the firm, and that in fact though there was a compromise between Mohanlal Chainraj and the defendants with reference to the amounts due to him in respect of the claims in O.S. No. 343 of 1968, the suit claim was not compromised at all.

3. In support of the defendants case that there was a compromise between the parties in respect of the suit claim, they have filed Exhibits A-1 to A-12 and examined P.Ws. 1 and 2, while the plaintiff has filed Exhibit B-1 and examined R.W.1. The trial Court held that as Mohanlal Chainraj has been authorised to act on behalf of the firm he had the requisite authority to compromise, and that the fact that admittedly there was a compromise in the other suit, O.S. No. 343 of 1968 on the file of Sub-Court, Coimbatore, at the instance of Mohanlal Chainraj, the compromise set up by the defendants in this case should also be true. In this view, the trial Court recorded the compromise under Order 23, rule 3 of the Code of Civil Procedure. The plaintiff firm has challenged the finding of the trial Court that there has been a compromise between the parties in relation to the suit claim and that the said compromise was legally valid.

4. According to the learned counsel for the appellant there has; in fact, been no compromise in relation to the suit claim either at the instance of Mohanlal Chainraj or at the instance of P.W.2, Jagadish Chainraj, who is admittedly a partner of the plaintiff firm, and that even if there had been any such compromise the same will not bind the firm as the person, who is said to have compromised the matter, did not have the requisite authority to do so. In this case, the trial Court seems to have proceeded mainly on the evidence of P. W.2, who admits having received originally a sum of Rs. 1,000 and later, after the filing of the application, LA. No. 131 of 1971 out of which this appeal arises, a sum of Rs. 4,000 as per the terms of the compromise said to have been entered into between the plaintiff and the defendants. In accepting the evidence of P.W. 2, Jagadish Chainraj, the trial Court has completely everlooked an obvious fact, which will go to show that P.W. 2 is not speaking the truth. The counter-statement in I.A. No. 131 of 1971 on behalf of the plaintiff-firm was filed by P.W. 2 and in that counter-statement he had clearly stated that there was no compromise of the suit claim either on 26th December, 1969 or on any other date, and that the plaintiff firm or any of its partners did not take part in any compromise talks and that Mohanlal Chainraj did not agree to compromise the suit claim on behalf of the plaintiff. Thus, the stand taken by P.W. 2 at the stage of the filing of the counter-statement on behalf of the plaintiff firm, is that there was no compromise of the suit claim at any time either at the instance of any of the partners or at the instance of Mohanlal Chainraj. Nearly two years after filing the said counter-statement denying the truth of the compromise pleaded by the defendants and contending that even if the compromise is true the same is not legally valid and binding on the plaintiff, Jagadish Chainraj has come forward now, at the stage of the trial, as P.W. 2 and has stated that at the instance of Mohanlal Chainraj he agreed to the compromise and in fact received a sum of Rs. 1,000 originally and later the balance of Rs. 4,000. In this state of affairs, the evidence of P. W. 2 cannot at all be accepted as true. P.W. 2 after filing the counter-statement denying the truth and validity of the compromise, cannot receive the amount from the defendants and say that the receipt of the amount is on behalf of the plaintiff firm. The trial Court is, therefore, in error in accepting the evidence of P.W.2 to the effect that he agreed to the compromise, especially in the face of his earlier counter-statement, wherein he had stated that there was actually no compromise at all and no partner had the authority to compromise. If P.W. 2s evidence is eschewed as being inconsistent with the counter-statement filed by him earlier in I. A. No. 131 of 1971, then we have only the evidence of P.W.1, who is said to be a relation of the defendants. According to him, the compromise was entered into between the plaintiff and the defendants at the instance of Mohanlal Chainraj in the course of the settlement of the other disputes between Mohanlal Chainraj and the defendants. Even assuming that Mohanlal Chainraj, while compromising all his claims as against the defendants, agreed for the settlement of the plaintiffs claim as against the defendants at Rs. 5,000, the said compromise cannot be taken to bind the plaintiff, firm. P.W. 1 has also deposed that P.W. 2 took part in the compromise talks and ultimately he received the entire sum of Rs. 5,000 in pursuance of the said compromise. Even assuming that P.W.ls evidence is true on this aspect, the question will arise whether Jagadish Chainraj, P.W. 2 had the requisite authority to compromise the suit claim on behalf of the firm. The trial Court has proceeded on the basis that since P.W. 2 as a partner had sufficient authority to represent the firm, he should be taken to have the requisite authority to compromise. It has also taken the view that P.W. 2 has been conducting the suit and, therefore, himself and Mohanlal should be taken to have the requisite authority to compromise the suit with the defendants in respect of the claim as against the defendants.

5. The two questions, therefore, that arise for consideration in this appeal are:

1. whether P.W. 2 or Mohanlal Chainraj had any authority to compromise the suit claim as against the defendants

2. whether the compromise effected by any of them will bind the plaintiff firm

6. On the first question, we find from the materials on record that Mohanlal Chainraj has filed the suit, O.S. No, 343 of 1968 on the file of Sub-Court, Coimbatore as against the same defendants claiming a sum of Rs. 35,000. There was also another claim as against them outstanding in favour of Mohanlal Chainraj. The defendants case is that while settling those disputes between Mohanlal Chainraj and the defendants, the plaintiffs suit has also been settled at his instance. The fact that Mohanlal Chainraj has settled his disputes with the defendants is not in dispute, and the dispute is only with regard to the alleged settlement of the plaintiffs claim as against the defendants covered by the suit, O.S. No. 672 of 1968. The mere fact that the two other claims as against the defendants have been settled between the defendants and the claimant, Mohanlal Chainraj, will not automatically lead to the inference that the plaintiffs claim as against the defendants had also been settled. As a matter of fact, the settlement effected between Mohanlal Chainraj and the defendants in O.S. No. 343 of 1968 has been reduced to writing and that has been marked as Exhibit A-6 in this case. There is no such deed recording the settlement so far as the plaintiffs suit claim is concerned before the filing of the application to record the compromise. The settlement is said to have been effected orally on the plaintiff receiving a sum of Rs. 1,000 at the first instance and agreeing to receive the balance of Rs. 4,000 later. Mohanlal Chainraj, who is said to have effected the compromise of the suit, has not been examined. Though certain letters written by Mohanlal Chainraj to the defendants claiming the amounts due to the plaintiff firm have been relied on by the defendants to show that Mohanlal Chainraj was authorised to settle the claim on behalf of the defendants, we do not see how the letters written by Mohanlal Chainraj demanding the amounts due to the plaintiff will enable him to compromise the suit claim. On the materials, therefore, we are clearly of the view that Mohanlal Chainraj had no authority to compromise the suit claim on behalf of the plaintiff firm. Similarly, the evidence on record does not disclose any authority on the part of P.W. 2 to settle the suit claim. The trial Court refers to the fact that P.W. 2, is a partner of the firm and is the person who is conducting the suit and, therefore, when he comes and says that the suit has been settled it should be taken as true. But as already pointed out, P.W. 2 has himself denied the truth of the compromise and he has categorically stated in the

counter-statement filed by him in I.A. No. 131 of 1971, that there was no compromise at any time. Having categorically denied the factum of the compromise, he has chosen to come as a defendants witness and depose that there was a compromise and that he has received a sum of Rs. 1,000 in pursuance of the compromise at the first instance and the balance after the filing of I.A. No. 131 of 1971. The evidence on record, indicates that there is a faction between the partners in the plaintiff firm after the filing of the suit and that P.W. 2 has chosen to collect the sum of Rs. 5,000 from the defendants as representing one faction to the prejudice of the other faction. If really there was a compromise the parties would have entered into a deed of compromise then and there as has been done in Exhibit A-6 with reference to the Mohanlal Chainrajs claims as against the defendants in O.S. No. 343 of 1968. Though there is such a deed of settlement signed by P.W. 2 and one J. C. Nichani, who was not a partner at a later point of time, having regard to the fact that the said deed came into existence only on 15th December, 1971, long after the filing of LA. No. 131 of 1971, that deed cannot support the defendants plea that there was a concluded compromise even earlier. We have, therefore, no hesitation in holding that there was no compromise entered into between the plaintiff and the defendants before the filing of I.A. No. 131 of 1971. One peculiar feature of Exhibit A-3 is that it proceeds on the basis that the compromise was effected on 15th December, 1971, and not on any earlier date. It does not refer to any earlier arrangement under which the suit claim has been settled. If really there was a settlement arrived at earlier as regards the plaintiffs suit claim, one would expect a recital to that effect in Exhibit A-8. Exhibit A-8 shows that P.W. 2 entered into compromise with the defendants only on 15th December, 1971 and not earlier. But the petition, I.A. No. 131 of 1971 for recording the compromise has been filed even on 18th February, 1971. Therefore, as on 18th February, 1971, there was no compromise established by the defendants. The question is whether such a compromise entered into by P.W. 2 either before or after the filing of I.A. No. 131 of 1971 can be valid in law,

7. Section 19 (2) of the Indian Partnership Act, 1932, clearly lays down that in the absence of any usage or custom of trade to the contrary, the implied authority of a partner does not empower him to compromise or relinquish any claim or portion of a claim by the firm or to withdraw a suit or proceeding filed on behalf of the firm. This section makes it clear that unless there is an express authority given to a partner by all the partners, that partner cannot compromise the claim or withdraw a suit. The trial Court has assumed a power on the part of P.W.2 to compromise merely because he was attending to the suit filed by the plaintiff firm. To file a suit and to conduct the same on behalf of the firm, no express authority is necessary. Therefore, the trial Court is in error in assuming an authority express or implied on the part of P.W.2 to compromise the matter, merely because he had been conducting the suit on behalf of the plaintiff, or had been claiming the suit amount from the defendants even before the filing of the suit. The trial Court has not anywhere said in its judgment that P.W. 2 had an express authority to compromise the suit claim on behalf of the other partners. Though it has said that P.W. 2 entered into a compromise with the consent of all the partners, it has not referred to any materials, which would indicate that there has been any implied or express consent given by the other partners to compromise the suit. In this view of the matter, we are not inclined to accept the view taken by the trial Court.

8. The civil miscellaneous appeal is, therefore, allowed and the order of the trial Court is set aside. The application, I.A. No. 131 of 1971, filed by the defendants will stand dismissed. The result is the suit will have to proceed to trial on merits. No order as to costs in the appeal.

Appeal allowed.