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Bhikaji Sabaji and ors. Vs. Bapu Saju and ors. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtMumbai
Decided On
Judge
Reported in(1877)ILR1Bom550
AppellantBhikaji Sabaji and ors.
RespondentBapu Saju and ors.
Excerpt:
indian companies act x of 1866, section 4--partnership--association--acquisition of gain--illegal agreement. - indian succession act (39 of 1925), section 63: [s.b. sinha & cyriac joseph, jj] will validity - deceased, was a very wealthy person - he floated several companies - he left behind his daughters, s and j - he was suffering from various diseases including some neurological ones - for his treatment, he used to frequently visit united states of america accompanied by his wife and daughter - by reason of a will, he is said to have bequeathed 50% of his property to s and 50% to j in a letter addressed to the 1st respondent, viz., s, he is purported to have recorded that the he had given all his shares to her - will was not only unnatural but was surrounded by a large number of..........to be illegal.' so here we have a partnership, or, at any rate, an association, for the purpose of carrying on a business that has for its object the acquisition of gain, and consisting of more than twenty persons, and being unregistered, it is an illegal association. it is obvious, therefore, that none of the parties acquired any rights under their agreement which can be enforced in a court of law. the rule must, therefore, be discharged with costs.
Judgment:

Charles Sargent, J.

1. This matter comes before me on a rule nisi obtained by the plaintiffs, calling on the defendants to show cause why they should not be restrained from working in wood, and carving boxes and other articles independently of two agreements entered into by them conjointly with the plaintiffs. It appears that the parties to this suit are all artizans, carrying on the trade of carvers in wood, or 'working box-makers' as they call themselves in their agreement. On 14th October 1875 they all entered into an agreement, by which the first plaintiff was appointed president and five other persons were appointed vice-presidents, to manage, according to a majority of votes, the business of the society for a term of five years. Fifty-seven of these 'working box-makers' signed this agreement, binding themselves for five years not to enter in the service of anybody, to do the business of 'working box-makers,' and not to receive work except through the president and vice-presidents. On 12th November 1875 the president and vice-presidents signed an agreement, binding themselves to perform the agreement of 14th October 1875. By these two agreements the parties to them have agreed with one another to form themselves into a society, and the object of such society, or, at any rate, one of the principal objects, was the acquisition of gain by the members by means of raising the price of their work. That this was so, appears from the statement of the object for which the society was formed, contained in the first clause of the agreement of 14th October 1875. [The learned Judge here read the clause set out above, and then continued.] Now I think it is difficult to say that this agreement does not create a partnership. But it is not necessary to decide the point, as in any case it creates an association of artizans for the purpose of carrying on their trade with a view to gain by its individual members. The principal object is by means of combination and association to increase the gain which they have heretofore been making from their work, and for this purpose they appoint certain members of their craft as managers who are to superintend the giving out of work according to the skill of the several members who are to be paid accordingly. If, then, this be an association of persons for the acquisition of gain by its individual members, it is, under the provisions of Section 4 of the Indian Companies Act X of 1866, an unlawful association, for it consists of more than twenty persons, (more than fifty having, in fact, signed the agreement), and it has not been registered. That section in the Indian Companies Act is in effect identical with the corresponding section of the English Act, Statute 25 and 26, Vic., C. 89, Section 4, except that the English Act saves Mining Companies subject to the jurisdiction of the Stannaries, and, therefore, Harris v. Amery L.R. 1 C.P. 148, which decided, on the English Act, that an association of more than twenty persons for the purpose of acquisition of gain which had not been registered being illegal, the members of it could not rely on their agreement for the purpose of establishing any right, is an authority applicable to the present case.

Willes, J.

2. Says: 'When we find an association like this, which is rendered illegal by an act of Parliament, we cannot take notice of the agreement under which they become tenants, for the purpose of establishing a right in a Court of law.' So, too, Byles, J., says: 'The statute having declared the association in question to be illegal, no rights can be acquired by any of its members which are founded upon that which is so declared to be illegal.' So here we have a partnership, or, at any rate, an association, for the purpose of carrying on a business that has for its object the acquisition of gain, and consisting of more than twenty persons, and being unregistered, it is an illegal association. It is obvious, therefore, that none of the parties acquired any rights under their agreement which can be enforced in a Court of law. The rule must, therefore, be discharged with costs.


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