Settlement of bill to a firm after expiry of its proprietor
p k kapoor
(Querist) 11 October 2010
This query is : Resolved
My employer is an educational institute under one of the Ministry, Govt. of India. It has appointed an agency for housekeeping services. The said agency is a proprietorship firm was run by an Ex-Army officer. Suddenly, due to death of the proprietor the firm has stopped its functioning. My employer has to pay/clear the arrear bills of the agency for the period for which the service was rendered satisfactorily. But, there is no existence of the firm now. However, the wife of the proprietor is praying hard and requesting us repeatedly to clear the dues so that outstanding salary to their employees can be released.
In view of the above situation, kindly help us with some legal guidelines for the following query:-
1. How to pay agency bills which has no existence on death of the proprietor?
2. What legal documents can be demanded from the wife/ legal heir if payment is to be released?
3. If payment is to be released, then in whose favour A/c payee cheque can be drawn legally?
Devajyoti Barman
(Expert) 11 October 2010
1. If it was proprietary firm then it has got non separate identity than that of the proprietor and hence you have got absolutely no hurdle to clear his dues to making the payment to his legal heirs including his wife.
2. If the arrears are released then ask for acknowledgment of all the legal heirs of that deceased person.
3. Cheque can be drawn on any of his legal heirs. The acknowledgment is the proof of payment not the cheque alone.
