P.S. Narayana, J.
1. This appeal is filed by the unsuccessful defendant in O.S.No.18 of 1994 on the file of the Senior Civil Judge, Nalgonda.
2. Respondent-plaintiff filed the above suit for recovery of an amount of Rs.2,10,350.07 ps. with future interest at the rate of 14.5% per annum till the date of realization. The same was resisted by way of filing written statement and after settlement of issues recorded the evidence of PWs.1 to 5 and DW.1 and on appreciation of documentary evidence Exs.Al to A16 and Ex.B1, the learned Senior Civil Judge, Nalgonda, ultimately decreed the suit for Rs.1,60,073/- with future interest at 6% per annum from the date of decree till the date of realization along with costs.
3. In view of the fact that the pending interest has been negatived, respondent-plaintiff filed cross-objections questioning the same.
Pleadings of the Parties :
4. Respondent-plaintiff filed the suit for recovery of amount as already referred to supra. It was pleaded in Paragraphs 3 to 10 of the plaint as hereunder :
3. That the plaintiff and defendant are the residents of Chityal Village and Mandalam, Nalgonda District. The plaintiff and defendant agreed to start a business by purchasing a Bore Well drilling Machine and to do Borewell drilling business under the name and style of M/s. Bharathi Bore Wells, Chityala with effect from 10-3-1986. The plaintiff and defendant have purchased Rig and Compressor by obtaining loan of Rs.3,50,000/- (Rupees Three Lakhs Fifty Thousand only) on 10-2-1986 from Canara Bank, Chityala Branch by depositing title deeds. It was agreed by both the plaintiff and defendant that they will invest the amount equally and profits and losses and repayments of the loans are to be shared equally. The plaintiff and defendant have got executed a partnership deed which was registered as No.2127 of Registrar of Firms dated 24-3-1986.
4. That the plaintiff and defendant have started the business and there was an understanding between the plaintiff and defendant that the Rig Machine should run by the son of the defendant as he was unemployed. The son of the defendant should do the business and collect the amount from the persons who got drilled with the Rig Machine and account for the same.
5. That the Canara Bank, Chityala Branch advanced the loan with repayment schedule that a sum of Rs.50,000/- (Rupees Fifty Thousand only) is to be paid immediately after availing the loan and the remaining amount has to be paid in the monthly instalment of Rs.5,900/- (Rupees Five Thousand Nine Hundred only). But the said repayment schedule was not followed by the defendant even though the plaintiff was ready to pay his part of contribution and paid the amounts. The Bank Authorities also demanded many times for the repayment but the defendant did not choose to repay the same.
6. That the son of the defendant did not show any interest in running the Rig Machine and as such losses occurred due to the non performance of the machine. The interest in the Bank was increasing day by day but the defendant did not show any interest in paying the said loan amount due to the Bank even after repeated demands made by the Bank Authorities. As the Rig Machine was not doing any business, it was kept idle in the premises of Ramakrishna Theatre, Chityal belonging to the plaintiff.
7. That the Bank Authorities demanded, compelled and threatened the plaintiff for the repayment of the entire due amounts as the plaintiff is a business man by profession and he enjoys some respect and status in the society. The plaintiff demanded the defendant for the payment of the loan amounts of his share and also got issued a legal notice on 25-7-1988 through Sri T. Nagarjuna, Advocate, Nalgonda for the payment of the loan amount and for the settlement of the account Subsequently the plaintiff and defendant have approached the elders and in the presence of the elders they have executed an agreement on 25-10-1988, that the persons who opts for the Rig Machine has to clear off the loan due to the Canara Bank and it was also agreed that there is no account for the settlement of the accounts. Accordingly the defendant agreed to take for the Rig Machine for Rs.1,71,000/- (Rupees one lakh seventy one thousand only) payable to the plaintiff and he and the plaintiff have signed the said agreement in the presence of the elders. But in variance of the said agreement also the defendant did not take rig machine and did not pay the amount to the plaintiff as agreed.
8. That the Bank Authorities frequently demanded the plaintiff for the payment of the loan amount and the plaintiff paid an amount to the tune of Rs. 1,55,437.50 paise (Rupees One lakh Fifty Five Thousand Four Hundred Thirty Seven and paise Fifty only) in cash to the Bank on various occasions as mentioned below :
Date of Payment Amount11-11-1996 Rs.40,000/-29-11-1986 Rs.20,000/-27-12-1986 Rs.15,000/-6-1-1986 Rs. 6,500/-5-3-1987 Rs.21,776.5024-2-1992 Rs.52,161.00---------------TOTAL Rs.1,55,437.50-------------- A sum of Rs.23,800/- (Rupees Twenty Three Thousand Eight Hundred only) which under K.D.R. in the name of the plaintiff was also adjusted in the said loan account. So also a sum of Rs.1,048/- (Rupees one thousand forty eight only) which is commission on the K.D.R was also adjusted. Totally Rs. 1,80,275.50 paise (Rupees One lakh Eighty Thousand Two Hundred Eighty Five and paise Fifty only) was credited by the plaintiff towards the loan amount. The K.D.R amount belonging to the plaintiff to the tune of Rs.2,51,296.70 paise (Rupees two lakhs fifty one thousand Two Hundred Ninety Six and paise Seventy only) which was with the Canara Bank, Chityala branch was also adjusted towards the loan amount. Thus a sum of Rs.4,31,582.20 paise (Rupees Four Lakhs Thirty one Thousand Five Hundred Eighty Two and paise Twenty only) was credited by the plaintiff towards the loan amount.
9. As the plaintiff and defendant failed to discharge the loan amount within the stipulated period the bank authorities have auctioned the Rig Machine and Compressor for Rs. 1,41,400.00 (Rupees one lakh forty one thousand four hundred only) and adjusted the same in the loan amount. The amount to the tune of Rs. 1,11,455.25 paise (Rupees one lakh eleven thousand four hundred fifty five and paise twenty five only) under K.D.R., which was to the credit of the defendant was also adjusted by the Bank Authorities towards the loan amount. The half share of the proceeds of the sale of Rig Machine will be Rs.70,700-00 (Rupees Seventy Thousand Seven Hundred only) and totally a sum of Rs. 1,82,155-25 paise (Rupees one Lakh Eighty Two Thousand one Hundred Fifty Five and Paise Twenty Five only) was adjusted towards the loan account to the defendant. But in fact a sum of Rs.6,84,437.45 paise (Rupees six lakhs eighty four thousand four hundred thirty seven and paise forty five only) was due to be paid in total, out of which a sum of Rs.3,50,0007- (Rupees three lakhs fifty thousand only) is principal amount and Rs.3,34,437.45 paise (Rupees three lakhs thirty four thousand four hundred thirty seven and paise forty five only) is the interest. The share amount to be paid by the defendant was Rs.3,42,218-72 paise (Rupees three lakhs forty two thousand two hundred eighteen and paise seventy two only) and out of the said amount for a sum of Rs. 1,82,155-25 paise (Rupees one lakh eighty two thousand one hundred fifty five and paise twenty five only) was adjusted. Thus a sum of Rs. 1,60,063-47 paise (Rupees one lakh sixty thousand sixty three and paise forty seven only) has to be paid by the defendant. But the said amount was also collected by the Bank Authorities from the plaintiff. The defendant evaded to pay the said amount in spite of repeated demands made by the bank authorities and also by the plaintiff. The plaintiff was forced to pay the said amount due by the defendant to the bank as the bank authorities insisted for the same. Therefore the plaintiff is entitled to receive the said amount of Rs. 1,60,063-47 paise (Rupees one lakh sixty thousand sixty three and paise forty seven only) with interest from the defendant as the said amount was paid by the plaintiff to the bank. The last date of the payment of the loan amount is dated 25-2-1992 on which date the K.D.R., amounts of the plaintiff have been adjusted towards the loan amount by the bank. The plaintiff is entitled to claim interest from the defendant at the rate of 14.5% per annum from the above said date till the date of payment.
10. That the plaintiff got issued a legal notice to the defendant for the payment of amounts on 26-2-1992 through Sri A. Muralidhar Rao, Advocate Nalgonda and also on 11-3-1994 from Sri P. Raghuvar Rao, Advocate Nalgonda. The defendant replied to the subsequent notice through Sri P. Ramanuja Chary, Advocate, Nalgonda on 23-3-1994 with by making all false and baseless allegations.
Averments in the Written Statement :
5. The appellant herein as the defendant in the suit filed the written statement resisting the suit claim with the following averments:
In reply to Para 3 of the plaintiff, it is not disputed that the plaintiff and the defendant agreed to start a bore well business in partnership under the name and style of M/ s. Bharathi Borewell, Chityal, but it is not true that the date of constitution of the firm was on 10-3-1986. As a matter of fact, as per the terms of the partnership deed executed by the parties on 10-3-1986, the parties constituted the firm with effect from 10-2-1986. It is also not disputed that the firm was registered with the Registrar of Firms on 24-3-1986, with the registration No. 2127. It is also not disputed that the firm obtained bank loan of Rs.3,50,000/- from Canara Bank, Chityal for purchase of the Borewell and allied machinery. As per the terms of the partnership deed the parties had to contribute the required capital half and half and share the profits and losses equally. For the purchase of the Borewell Rig Machinery and compressor this defendant contributed Rs.70,000/- as the bank loan was insufficient to purchase all the machinery required to purchase the Borewell Compressor and the Rig Machinery.
The averments contained in Para 4 of the plaint, are absolutely false. There was no understanding between the parties that this defendant's son should run the Rigging business and make collections and account for the same. As a matter of fact and as per the terms of the Partnership Deed, the plaintiff himself was the manager of the firm, and he alone was managing the business, collecting dues from the customers and maintaining the accounts of the firm. The plaintiff is put to strict proof of establishing the allegations of Para 4 of the plaint.
In reply to Para 5 of the plaint, it is submitted that in the repayment programme, the firm had to pay Rs.5,900/- per month to the Canara Bank; and that as the plaintiff himself was managing the business he was required to pay the instalments and other amounts payable to the bank, as per the agreement with the Bank out of the income from the business. However, as per the statement of account furnished by the said bank to this defendant, the firm paid Rs.40,000/- on 1141-1986, Rs.20,000/- on 29-11-1986, Rs.15,000/- on 27-12-1986, Rs.6,500/- on 6-1-1987 and Rs.21,776-50 ps. on 5-3-1987. Thus upto 5th March 1987, more than what was required to be paid to the bank; towards monthly instalments was paid. The plaintiffs contention that he paid those amounts to the bank from out of his own money is not correct. The plaintiff made the said payments as the manager of the firm from the income derived from the business. The plaintiffs contention that he was ready to pay his part of the instalment amount whereas the defendant was not ready to pay his part of the instalment is false. The firm derived huge profits during the period of two years from the date of the loan, and if the plaintiff produces the firm's accounts which he is supposed to maintain and which he actually maintained as the manager of the firm, truth will come out of it. Moreover, the plaintiff collected Rs.80,000/-from Singireddi Laxma Reddy and Shankaraiah Goud and allowed them to use the Borewell machinery for about seven or eight months, without the consent of the defendant. The said amount is also with him and he has to account for it. The question of payment of instalment amount personally by the parties arises only if the income of the firm was not sufficient to pay the instalment amounts. It is denied that the Bank Authorities demanded this defendant to pay the instalment amount. If at all, any demand for payment of instalment amounts was made by the bank, it was from the firm represented by the plaintiff as the manager of the firm.
The averments contained in Para 6 of the plaint are denied. This defendant's son had nothing to do with the Rig Borewell business. The plaintiffs contention that losses accrued in the business is denied. The plaintiff carried on the Rig Borewell Business even in the year 1988. When this defendant asked the plaintiff for rendition of the accounts of the firm, he refused to show the accounts. Therefore, disputes arose between the parties. The plaintiff was always keeping the Rig Machinery etc., in the premises of his theatre Rama Krishna Talkies when there was no work for the Rig.
Para 7 of the plaint suffers from the defect of suppressio veri and suggestio falsi, Though it is true that the plaintiff got issued a notice to this defendant on 25-7-1988, from the office of Sri T. Nagarjuna, Advocate, some of the contents of the notice were wrong. It is not true to say that this defendant failed to keep up the repayment of loan by agreed instalments whereas the plaintiff was ready. If the borewell was kept idle in the premises of the theatre Rama Krishna Talkies, Chityal, the plaintiff himself was and is responsible for it, as the Managing Partner of the firm. The accounts of the firm had to be rendered by the plaintiff himself. It is not disputed that the parties approached the elders on 25-10-1988 and that as a result of the discussion of elders they entered into any agreement in writing. But it is not correct to say that as per the said agreement who ever out of the parties opts for the Rig Machinery for himself, he has to clear off the bank loan. The agreement recites that the value of the Rig machinery should be fixed by the plaintiff, that the defendant could take the machinery for himself for that price and that in case the defendant was not willing to take it for himself, the plaintiff should necessarily take it for himself, for the same price. As the plaintiff shall be deemed to have taken the Rig Machinery for himself on account of this defendant not having opted for it he ought to have deposited the said amount ha the Bank towards bank loan, and after deducting the said amount from bank dues, as on the date of deposit within one month the parties shall be liable to pay the balance loan amount half and half. The plaintiff's contention that this defendant agreed to take the Rig Machinery for Rs.1,71,000/- but failed to lake the Rig Machinery for himself and to pay the said amount to the plaintiff is a make believe story set up for the purpose of this suit. As a matter of fact, this defendant did not agree for taking the said Rig Machinery and consequently, the plaintiff had to keep the rig etc., for himself and pay Rs.1,71,000/- in the Bank and thereafter both the parties had to pay the balance half and half. The plaintiff failed to deposit the amount of Rs.1,71,000/- within one month from the date of agreement as per the terms of the agreement, dated 25-10-1988, and as he had the sole custody of the Rig Machinery, he is liable for interest on the said amount of Rs.1,71,000/- and also for the shortage in the price fetched in auction of the Rig machinery conducted by the bank subsequently. The agreement was prepared in duplicate and each party was given one such agreement. The plaintiff has filed in the Court the agreement given to him, but therefore filing it in the Court, he added an endorsement on it in his own hand writing and under his signature that this defendant agreed to take the Rig Machinery. The agreement given to this defendant is filed herewith. It does not contain any such subsequent endorsement on it. The absence of the said subsequently added endorsement in the agreement filed by this defendant and the exclusive possession of the Rig by the plaintiff subsequent to the said agreement is self-explanatory. It goes a long way to establish that as the defendant refused to take the Rig for himself, the plaintiff took it for himself as per the terms of the agreement and therefore, he himself was responsible for the subsequent interest on the said amount of Rs.1,71,000/- upto the date of auction and also for the shortage in the price fetched in the auction of the Rig by the Bank Authorities.
The averments contained in Para 8 of the plaint suffers from the defect of suppressio veri and suggestio falsi. The deposit of Rs.40,000/- on 11-11-1986, of Rupees 20,000/-on 29-11-1987 of Rs.15,000/- on 27-12-1986, of Rs.6,500/- on 6-1-986 and of Rs.21,776.00 on 5-3-1987 with the bank in the aforesaid loan account of the firm were all made by the firm from out of the funds of the firm, while the Rig Machinery was working, under the management of the plaintiff and not a single pie out of it was paid by the plaintiff from his personal funds. That is why in the agreement, dated 25-10-1988, it was clearly mentioned that upto the date of agreement neither party to the agreement had to pay the other party any dues with regard to the Rig business and further that the settlement was arrived at between the parties without the necessity of going through the account. If the plaintiff wants to claim the deposits in the loan account of the firm as his own, then he has to render the accounts of the firm upto the date of the agreement, as the managing partner of the firm. The statement of accounts furnished by the Canara Bank to this defendant shows that the bank charged Dic. G.C. Fees of Rs.l,392-50 ps. on 18-7-1986, of Rs.1,258.80 ps. on 13-2-987 of Rs.1,392-50 ps. on 4-7-1987, of Rs.1,469-30 ps. on 17-1-1989 for the years 1986, 1987 and 1988 and charged compound interest thereon. Further, the Canara Bank has also charged penal interest of Rs.591-40 ps. upto March, 1987 of Rs.255.70 ps. upto My, 1987, of Rs.226.00 upto September, 1987, of Rs.357.20 ps. upto December 1987, of Rs. 1,259.60 ps. upto June, 1988 and also charged compound interest thereon. The charging of DIG G.C. fees and Penal interest and the charging of compound interest thereon are illegal. By the end of December. 1989 the bank has shown the dues payable by the firm as Rs.3,91,781-55 ps. if D.I.C. G.C. fees and the penal interest with compound interest charged thereon are deducted from the said alleged dues of Rs.3,91,781.55 ps. the real dues payable by the firm to the bank by December 1988, would not have exceeded Rs.3,71,000/-. Had the plaintiff paid the bank Rs.1,71,000/- being the price of the Rig retained by him for himself, the dues payable by the parties to the Bank would not have exceeded Rs.2,00,000/- therefore, as per the agreement dated 25-10-1988, this defendant was liable to pay the bank not more than Rs,l,00,000/-with subsequent interest thereon. If calculated, the said amount of Rs.1,00,000/-with interest would not have exceeded Rs. 1,11,455.25 ps. on 20-4-1991, when the bank encashed the K.D.R. 87/85 belonging to this defendant and credited the proceeds amounting to Rs. 1,11,455.25 ps. in the loan account of the firm. If any excess amount over and above, the legally due amount was paid by the plaintiff in the bank, he has to claim it from the bank only. Under any circumstances, he cannot claim it from this defendant. It is denied that altogether the plaintiff deposited in the loan account of the firm with the bank, Rs.4,31,582.20 ps., from his purse.
In reply to Para 9 of the plaint, it is not disputed that Canara Bank auctioned the Rig Machinery and compressor for Rs.1,41,400/-. It is also not disputed that the said bank encashed the K.D.R. standing in the name of this defendant and credited the proceeds in the loan account of the firm. But the contention of the plaintiff that half of auction proceeds namely Rs.70,700/- and the entire proceeds of K.D.R of this defendant amounting to Rs. 1,11,455-25 ps. were adjusted by the Bank towards the dues payable by the firm to the Bank. As stated supra, the entire proceeds derived by the auction sale of the Rig and Compressor machinery shall be deemed to be the payment made by the plaintiff, as he had taken the Rig for himself with the liability for the payment of Rs.1,71,000/- within one month from the date of the agreement between the parties. As stated above, this defendant was liable to pay the bank only half of what remained after deducting Rs.1,71,000/- from the dues legally payable by the firm to the bank as on 25-11-986 and the said dues payable by the defendant for his share got wiped out when the bank encashed the K.D.R. No.87/85, standing in the name of this defendant. It is disputed that a sum of Rs.6,84,437-45 ps., was the total debit side figure in the firm's account with the bank, that half of the same amounting to Rs.3,42,218-72 ps. was to be paid by this defendant. It is further denied that after deducting Rs. 1,82,155-25 ps. (made up of half of auction sale proceeds of the Rig and the Compressor and the entire proceeds of K.D.R. standing in the name of this defendant) a sum of Rs. 1,60,063-47 ps. has to be paid by this defendant to the bank and that as the bank recovered the said amount from the plaintiff, this defendant is liable to pay the said amount to the plaintiff. As stated above, this defendant was not liable to pay any amount to the bank for his share and therefore, the plaintiff is not entitled to recover any amount from this defendant. It is denied that the plaintiff is entitled to interest on the said amount of Rs. 1,60,063-47 ps., at the rate of 14.5% per annum from 25-2-1992 till the date of payment.
In reply to Para 19 of the plaint, the issue of legal notice by the plaintiff from the office of Sri P. Raghuvar Rao, Advocate and the issue of reply notice from the office of Sri P. Ramanuja Chary, Advocate are not disputed. It is however, submitted that the contents of the legal notice got issued by the plaintiff are incorrect, whereas the contents of the reply notice are correct.
Issues Settled by the Trial Court :
6. On the strength of the pleadings of the respective parties, the following issues were settled by the trial Court :
1. Whether the plaintiff himself is manager of the firm and alone managed the business and accounts of the firm ?
2. Whether the plaintiff deposited an amount of Rs.1,71,000/- for the Rig Machine within one month as per agreement dated 25-104988 ?
3. Whether the D.I.G. G.C. fees and penal interest and with compound interest by the Canara Bank is illegal ?
4. Whether the plaintiff is not entitled to recover the suit amount of Rs.2,10,350.07 ps., together with interest from the defendant ?
5. Whether the suit is barred by limitation ?
6. To what relief ?
Findings Recorded by the Learned Senior Civil Judge, Nalgonda :
7. The learned Senior Civil Judge, Nalgonda, on appreciation of the evidence available on record, recorded the following findings:
8. The learned Senior Civil Judge answered issue No.l to the effect that P.W.I himself being the managing partner of the firm was looking after its affairs. While answering Issue No.2, a finding was recorded that the agreement covered under Ex.A4 was never acted upon by the parties to the suit and as such, no right to either party arise out of the said agreement. But, however, they came to an understanding that there is no need to look into the accounts of the firm and the amount found due to the Bank has to be cleared off by both the plaintiff and defendant equally and hence, the said issue was answered finally that there was no such agreement arrived at under Ex.A4 dated 25-10-1988 that P.W.I has to deposit an amount of Rs. 1,71,0007- with the bank within one month from the date of the agreement and further finding had been recorded that since Canara Bank is not a party to the suit and the loan amount raised by the plaintiff and defendant partnership firm was already discharged, there is no need to record any findings relating to Issue No.3. The learned Judge answered Issue No.4 to the effect that the plaintiff is entitled to claim the amount of Rs. 1,60,063-47 ps. rounded to Rs. 1,60,0737- and with future interest at 6% per annum from the date of the decree till the date of realisation. The learned Judge answered Issue No.5 to the effect that the suit is in time and ultimately while answering Issue No.6 decreed the suit as already specified supra.
The contentions of Sri T.P. Satyanarayana Chart :
9. The learned Counsel representing the appellant-defendant made the following submissions :
10. While making the submissions, the learned Counsel would point out that in the light of the fact that the agreement under Ex.A4 had been disbelieved and a finding had been recorded in this regard by the learned Judge, the parties would be relegated to the original position of being partners and hence, when the partnership is continuing in existence in the eye of law, the remedy of filing suit by a partner as against another partner for recovery of amount cannot be maintained. The learned Counsel also had pointed out the applications moved in CMP Nos.11876, 20250 and 20252 of 2002 and would maintain that the question of maintainability of the suit both in the light of the provisions of the Indian Partnership Act and also the Hyderabad Money Lenders Act, these are pure questions of law and though no specific plea had been taken and issues had been settled before the original Court, these can be permitted to be raised, they being pure questions of law. The learned Counsel also pointed out relating to the maintainability of the cross-objections before this Court. The question of pecuniary jurisdiction and the test of maintaining independent appeal and the bar of limitation in this regard may also, have to be taken into consideration. The learned Counsel while further elaborating his submissions had pointed out the findings recorded by the learned Judge and had taken this Court through the evidence of P.W.1 and D.W.1 in particular and had explained that the evidence is vague relating to the statement of accounts and hence, this cannot be taken as statement of account between the parties and in view of the same, the remedy by way of filing a suit for recovery of amount cannot be maintained.
11. The learned Counsel placed strong reliance in case of T.K.P, Rajagopala Chettiar and others v. A.P.S. Palani Chettiar and Anr. : AIR1954Mad1101 (FB), wherein a Full Bench of Madras Court had disagreed the view taken in the case of Chockalingam Chettiar v. Meyappa Chettiar and Ors. AIR 1938 (2) MLJ 287. The learned Counsel also would place strong reliance in the case of A.R.M.M. Meyappa Chettiar and another v. P.N.M.M. Palaniappa Chettair and others, AIR (36) 1949 Mad. 109(2).
12. Learned Counsel also pointed out that even, otherwise, in the light of the material alteration, which had crept in Ex-A4, the same cannot be looked into inasmuch as the said document would be void and unforceable. Learned Counsel placed reliance in case of Loonkaran Sethia etc., v. Mr. Ivan E. John and others. : 1SCR853 , Janab M.H.M. Yakoob (died) and others v. M. Krishnan (died) and others, : AIR1992Mad80 . Learned Counsel while further making his submissions had pointed out that the cross-objections are not maintainable before this Court since an independent appeal could have been maintained by the time the cross-objections were filed here. Apart from this aspect of the matter, the learned Counsel pointed out that in view of the pecuniary jurisdiction an independent appeal of this nature could have been filed only before the District Court and not before this Court, despite the fact that first appeal would lie to this Court. Learned Counsel would maintain that this would amount to the circumventing filing of an appeal which would be otherwise, barred by limitation. On the aspect of cross-objections, the learned Counsel pointed out that inasmuch as there is no specific agreement relating to payment of interest, in such a case, it is within the discretion of the Court and other party cannot claim interest as a matter of right. Learned Counsel placed strong reliance in the case of Union of India v. Ishwarnand Saraswat, : 1SCR580 and also in the case of Vithal Dass (in both the appeals), v. Rup Chand and others (in both the appeals), : AIR1967SC188 . Learned Counsel ultimately would conclude that at any rate, even if the findings of the learned Judge are taken into consideration, the suit is not maintainable and hence the same is liable to be dismissed.
Submissions of Sri Narasimha Sarma :
13. The learned Counsel representing Sri A. Radhakrishna made the following submissions:
14. Learned Counsel would maintain that in the light of the evidence of P.Ws.1 and 4, and D.W.1, it is clear that the deduction that was made by the bank even in the fixed deposits (FDs), and it cannot be said to be a voluntary payment by one of the partners. Learned Counsel also would maintain that in the light of the findings recorded by the learned Judge that Ex-A4 was not acted upon and in view of the fact that no more settlement of account would be required between the original partners, the question of filing a separate suit for dissolution of partnership and rendition of accounts would not arise. Even otherwise, as the accounts are not available, it would be just a futile exercise. Learned Counsel also would contend that though the proposition laid down by the Full Bench of Madras High Court in the case of Rajagopal Chettiar (supra), may have to be followed, the same is not applicable to the facts of the case. The learned Counsel also had taken this Court through the evidence of P.W.1 and D.W.1 and also had pointed out to the evidence of P.W.4 in particular in this regard. Learned Counsel while further elaborating his submissions would point out that as far as the bar of the Hyderabad Money Lenders Act is concerned, such a plea was not taken in the written statement even otherwise in the light of the nature of the present litigation, the same is not applicable. Learned Counsel also would contend that relating to the maintainability of the suit inasmuch as it is a question of law that arises out of the admitted facts available on record, the same can be raised and no separate issue need be framed in this regard. Learned Counsel would further contend that it is a case where the partners arrived at an agreement and though a finding had been recorded that Ex-A4 was not acted upon by virtue of the understanding between the parties, it was taken that no further accounts need be settled and only dispute that remained between the original partners of the firm which can be styled as the erstwhile partnership firm was to clear the amount payable to the bank in equal shares. Learned Counsel also on the aspect of material alteration in Ex-A4 pointed out and would contend that this cannot be very significant in the light of the positive findings recorded by the learned Judge that Ex-A4 was not acted upon. Even otherwise, there is no material alteration. While further elaborating the submissions, the learned Counsel pointed out that the cross-objections filed claiming interest can be perfectly maintained inasmuch as even if pecuniary jurisdiction is taken into consideration, the same can be maintained before this Court. Even otherwise, in alterative the learned Counsel would contend that in the light of Order 41 Rule 22 CPC and Order 41 Rule 33 CPC and inasmuch as even without filing cross-objections adverse findings can be attacked and agitated by the successful party and as far as negativing the interest for the pending period is concerned, the same can be agitated even in the absence of the cross-objections. At any rate, the learned Counsel would maintain that if the stand taken by the other side in relation to filing of cross-objections to be accepted it would lead to anomalous situation, driving the parties to the other Court by virtue of which the matters have to be transferred to this Court. The learned Counsel also had pointed out that in the light of Section 34 CPC normally discretion has to be exercised in favour of the parties who were successful, in granting the interest, pending litigation also and no reasons are forthcoming why that other relief had been negatived and hence the said finding cannot be sustained and the cross-objections may have to be allowed.
Points which arise for consideration in this Apeal :
15. In the light of the rival contentions advanced by both the learned Counsel, the points that arise for consideration in this appeal are as follows :
1. Whether the suit for recovery of amount by the plaintiff can be maintained in the facts and circumstances of the case ?
2. Whether the alleged material alteration pointed out in Ex-A4 can be taken as a ground to non-suit the plaintiff?
3. Whether CMP Nos. 11876, 20250 of 2002 are to be allowed in the facts and circumstances of the case ?
4. Whether the cross-objections preferred by the plaintiff can be maintained ?
5. Whether CMP No.20252 of 2002 to be allowed in the facts and circumstances of the case ?
6. If so, to what relief the parties would be entitled to ?
Points 1 to 3 :
16. The factual matrix as reflected in the pleadings, as already narrated supra need not be repeated again. The evidence of P.Ws.l to 5 and D.W.1 was recorded and Ex-Al to A16 and Ex-Bl, which is a copy of the agreement marked as Ex-A4 had been marked by the learned trial Judge. P.W.I is the plaintiff. P.W.2 is one of the elders. P.W.3 was examined in chief but the evidence was not completed and hence it is needless to say that his evidence was eschieved. P.W.4 is the Manager of Canara Bank, Chityal. P.W.5 is one B. Raji Reddy, the witness of Ex-Al6. The findings recorded by the learned Judge already had been referred to supra.
17. Strong reliance was placed by the learned Counsel for the appellant in case of Rqjagopal Chettiar and also in case of Chockalingam Chettiar (supra), respectively, to substantiate the stand that a suit for recovery of amount by a partner as such cannot be maintained unless a suit for dissolution of partnership and rendition of accounts had been filed. There cannot be any quarrel about this proposition of law as such. But it is to be seen whether in the facts and circumstances, these decisions are applicable to the present facts of the case or not. Apart from this aspect of the matter, on the ground that there has been material alteration in Ex-A4, it was contended that the same is vitiated, after recording reasons, the learned Judge recorded a finding that Ex-A4 in fact was not acted upon. The learned Counsel for the appellant placed reliance in case of Loonkaran Sethia etc, v, Mr. Ivan E. John and others (supra) and also in the case of Janab M.H.M. Yakoob (died) and others v. M. Krishnan (died) and others, (supra), P.W.1 deposed in detail relating to the pleadings and also had explained Ex-A4 relating to which material alteration is seriously canvassed. The fact of obtaining loan from the bank is not in serious dispute. Several other facts also are not in controversy between the parties. Ex.A-1 is the certificate of acknowledgment of registration of firm. Ex-A2 is the registered partnership deed. In the light of the same, the original existence of the partnership need not be in serious dispute or controversy between the parties. Ex-A4 is the agreement dated 25-10-1988, which is equalent to Ex-Bl. Ex-A5 is the office copy of the notice. Ex-A6 is the postal receipt. Ex-A7 and A8 are letters from Canara Bank, Chityal to plaintiff dated 29-1-1994 and 22-1-1994 respectively. Ex-A9 is the office copy of the notice. Ex-A 10 is the postal acknowledgement. Ex-All is the reply notice. Ex-Al2 is the ownership certificate relating to house standing in the name of Kusa Lingaiah. Ex-Al 3 is the extract from the house tax register for the year 1989-90. Ex-A14 is the receipt for Rs.25/- issued by the Grampanchayat, Chityal for payment of Revision Fee. Ex-Al5 is the certified extract of the pahani for the year 1992-93. Ex-Al6 is another agreement dated 18-4-1999. The oral evidence of P.Ws.l, 2, 4 and 5 and D.W.1 in detail had been appreciated by the learned Judge and findings had been recorded. P.W.1 explained in detail under what circumstances ultimately the suit was filed for recovery of the amount. In this context, the evidence of P.W.4 in particular may be looked into, who had explained in detail the accounts of the loan relating to these parties and how the term deposits of the plaintiff had been adjusted. In this context, certain submissions were made that this cannot be said to be a voluntarily payment on the part of the plaintiff. But in view of the peculiar circumstances and in view of the adjustment, the amount had been deducted and hence in the light of the settlement between the original partners who became the erstwhile partners inasmuch as no longer accounts need be settled, the suit for recovery of amount, can be maintained. This is a crucial question in controversy between the parties. The other evidence of P.Ws.2 and 5 may not throw much light but, however, the admissions made by both P.W.1 and D.W.1 in this regard may have to be carefully scrutinized. P.W.1 in his chief examination deposed in detail relating to the aspects of the partnership and how the business was being run and relating to obtaining loan and tallying of the accounts and other aspects. The documentary evidence also had been spoken to by P.W.1. In cross-examination this witness denied several suggestions and also deposed that defendant maintained the accounts and was supervising and there are no account books to the partnership firm. This witness also deposed about the mediation and the details relating to those aspects. This witness further deposed in detail about Ex-A4 and what happened before the elders. If the evidence of D.W.1 is carefully scrutinized, it is clear that these parties had referred the dispute to elders and even in chief examination D.W.1 deposed about the details of mediation. D.W.1 also deposed about P.W.1 informing the elders that there was no need to go for the accounts and either P.W.1 or D.W.1 will take the bore well machine and he also deposed about the price fixed relating to the bore well machine and no doubt he deposed that he did not agree and P.W.1 insisted that the bore well machine should not be sold to others. He should be taken by either of the parties and he expressed the invalidity. This witness also deposed about Ex-B1, which is equalent to Ex-A4. It is needless to say that on appreciation of evidence on record, the learned Judge recorded positive finding that Ex-A4, which is equalent to Ex-Bl was not acted upon. In cross-examination there are several admissions made by D.W.1 and this witness made admissions relating to the loan transaction with the bank and also deposed relating to the mediation and the terms settled. However, denies several suggestions.
18. It is pertinent to note that certain of the answers made by D.W.1 are contrary to certain of the answers, which D.W.1 gave in his cross-examination. This witness admitted that himself and P.W.1 are liable to discharge the loan amount. But however, when a suggestion was put to him, he denied the fact that he is also liable to share 1/2 of the liability to the bank. This is the nature of evidence of D.W.1. Except the evidence of D.W.1, there is no other evidence forthcoming.
19. In CMP No.20250 of 2002 relief was prayed for to raise the ground of bar of the suit in the light of Section 9 of A.P. (Telangana Area) Money Lenders Act. This was not raised as a plea and even otherwise, this question may not be relevant in the light of the facts of the present case. The relief prayed for in CMP No. 11876 of 2002 need not be considered with seriousness for the reason that the question of maintainability of the suit is being decided by this Court in the light of the rival contentions advanced by both the Counsel. In view of the same, it is needless to say that the CMPs are liable to be dismissed and accordingly the same are hereby dismissed and the findings recorded by the learned Judge in this regard on appreciation of the evidence of P.W.1 and D.W.1 and P.W.4 in particular and also in relation to Ex-A4 are hereby confirmed.
Points 4 and 5 :
20. Relating to the maintainability of the cross-objections submissions were made in elaboration. Inasmuch as the maintainability is being considered, CMP No.20252 of 2002 need not be allowed and hence the CMP is accordingly hereby closed.
21. When an appeal is preferred to this Court on the ground of pecuniary jurisdiction merely because the negatived relief would fall within the pecuniary limits of a Subordinate Appellate Court it cannot be said that the cross-objections are to be filed by way of an independent appeal only before such Subordinate Appellate Court but not before this Court, in my considered opinion this cannot be accepted. In the light of the language of Order 41 Rule 22 of CPC, this Court is of the considered opinion that when a portion of the relief had been negatived and adverse findings had been recorded, the successful party aggrieved of that portion always can raise cross-objections in an appeal filed by the unsuccessful party, and on the ground of pecuniary limits such party cannot be driven to yet another Court. If this interpretation given, as contended by the learned Counsel for the appellant to be accepted this would land the litigations in serious trouble. Even otherwise, in the light of the express language of 'the provisions referred to supra, such interpretation cannot be given. Hence I am of the considered opinion that the cross-objections before this Court can be maintained irrespective of the fact that the pecuniary limits of the cross-objections may be far below, the pecuniary limits of this Court to entertain a regular appeal. Even otherwise certain submissions were made that even if pecuniary limits be taken into consideration cross-objections are maintainable and this question need not be seriously considered in the light of the view expressed by this Court supra.
22. The question that has to be decided is whether the relief prayed for by the cross-objector-respondent-plaintiff relating to interest pendenti life can be granted in the facts of the case.
23. Learned Counsel for the appellant placed strong reliance on the decisions of the Apex Court in case of the Union of India and also in case of Vithal Doss (supra) respectively. It is needless to say that granting or refusing interest during the pendency of the litigation is within the discretion of the Court and it is no doubt true that discretion may have to be exercised properly. In the facts and circumstances of the case, here is a case where the erstwhile partners in view of the understanding, though Ex-A4 was not acted upon fight the present litigation for the purpose of recovery of some amount, which had been adjusted from the bank. Taking this fact, when the learned Judge was not inclined to grant relief of interest during the pendency of the litigation and also especially in the light of the stand taken by the learned Counsel for the appellant that there is no such agreement for payment of interest between the parties, I am of the considered view that negativing interest for the relevant period cannot be found fault with and accordingly, the cross-objections also are bound to fail being of no merit for consideration.
Point No.6 :
24. In the light of the foregoing discussion, I am of the considered opinion that the appeal is devoid of merits and accordingly the same shall stand dismissed and equally the cross-objections also are being devoid of merits and the same are hereby dismissed. It is a case where the original partners of a partnership firm, who became the erstwhile partners in view of the subsequent understanding are fighting the present litigation in relation to recovery of some amount, which had been adjusted by the bank. In the light of these peculiar facts and also in view of the fact that both the appeal and cross-objections are being dismissed as devoid of merits, the parties to the litigation shall bear their own costs throughout the litigation. It is needless to say that if any balance amount, is lying in deposit, the plaintiff is at liberty to withdraw the same.
25. With the above observation, the appeal and cross-objections are hereby dismissed. No costs.