Apni Law Staff asked 1 year ago
My father and uncle, along with their brother, ran a manufacturing business that unfortunately shut down due to losses. A former worker filed a case in the labour court, and due to financial difficulties, the family couldn’t fight the case, resulting in an ex parte order against them ten years ago. Even though all the summons were served, they were unable to respond. Now, the worker is seeking to attach and auction joint property owned by my father, uncle, sister, and mother.
Since the liability is only on the partners, can their joint property be auctioned? If so, what can be done to prevent this auction?
Best Answer
Apni Law Staff answered 1 year ago
Under Indian law, the liability of partners in a business is joint and several, meaning creditors can pursue any partner individually for the full debt. However, attaching joint property owned by family members not involved in the business requires proving their involvement in the partnership or benefiting from the business profits. You can challenge the auction order by demonstrating the lack of such involvement and seek relief from the ex parte order by appealing within the prescribed time limit.
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