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Govindan Nair Vs. Nagabhushanammal and anr. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1948Mad343; (1948)1MLJ331
AppellantGovindan Nair
RespondentNagabhushanammal and anr.
Excerpt:
- .....by them would not be a partnership. nothing more is done by the parties than utilising the common property and obtaining a return for such use by leasing the property for rent. the contribution made by the plaintiff and the first defendant towards the price for the acquisition of the property in equal moieties would only make them co-owners and not partners. they never carried on any business but only obtained a return by using the common property. the distinction between part ownership and partnership is no doubt very difficult to define. as pointed out by lindley on partnership, 10th edition at page 32,if each owner does nothing more than take his share of the gross returns obtained by the use of the common property, partnership is not the result.2. at page 33 the learned.....
Judgment:

Satyanarayana Rao, J.

1. On the facts that emerge in this case it is difficult to sustain the finding of the learned Judge that the plaintiff is a partner with the first defendant in the tea shop and that this suit is cognizable by the City Civil Court. According to the plaintiff, the tea shop was purchased for a sum of Rs. 846-8-0 including the additional expense incurred for purchasing utensils, etc., and that out of this sum the first defendant contributed a half, i.e., Rs. 423-4-0. According to the plaintiff the shop was leased by the plaintiff and the first defendant on a daily rent of Rs. 4-8-0 and the rent was being divided between them both. According to the first defendant, however, he is the exclusive owner of the shop and the plaintiff has no interest in it. The plaint was framed on the footing that the plaintiff and the first defendant are partners each owning a half share in the business and the plaintiff seeks to obtain a decree dissolving the partnership and for accounts. The first defendant raised the objection that the City Civil Court had no jurisdiction to entertain the suit as there was no partnership and the only right of the plaintiff, if she established her right to a half share in the property, was to get an ascertained amount of Rs. 2-4-0 per day being her share of the rent. On these allegations the only question that arises for decision is whether the first defendant is the exclusive owner of the tea shop or whether the plaintiff and the first defendant are joint owners. Even according to the facts as alleged by the plaintiff the relationship constituted by them would not be a partnership. Nothing more is done by the parties than utilising the common property and obtaining a return for such use by leasing the property for rent. The contribution made by the plaintiff and the first defendant towards the price for the acquisition of the property in equal moieties would only make them co-owners and not partners. They never carried on any business but only obtained a return by using the common property. The distinction between part ownership and partnership is no doubt very difficult to define. As pointed out by Lindley on Partnership, 10th edition at page 32,

If each owner does nothing more than take his share of the gross returns obtained by the use of the common property, partnership is not the result.

2. At page 33 the learned author observes,

Moreover, part owners who divide what is obtained by the use or the employment of the thing owned are not thereby constituted partners. For example, if two tenants in common of a house let it and divide the rent equally between them, they are not partners although they may pay for the repairs out of the rents before dividing it. So two persons who are co-owners of a race horse, and share his winnings on the one hand, and the expenses of his keep on the other, are not partners but co-owners only.

3. This last illustration in my opinion exactly applies to the facts of the present case. The same distinction is provided by Explanation 1 to Section 6 of the Indian Partnership Act, which reads as follows:

The sharing of profits or of gross returns arising from property by persons holding a joint or common interest in that property does not of itself make such person partners.

4. As stated already it is very difficult to apply the definition of partnership contained in Section 4 of the Act to the facts of the present case as the plaintiff and the first defendant did not carry on any business in respect of tea shop except leasing the common property for rent. I am therefore of opinion that in this case the essentials that go to constitute the relationship of partnership are wanting and that if the case of the plaintiff is true, she was merely a part owner with the first defendant. In this view of the case, the learned City Civil Judge had no jurisdiction to try the suit. The appeal is therefore allowed and the decree of the lower Court is set aside. The plaint will be returned for presentation to the proper Court. The first defendant undertakes not to draw the money deposited by him in the City Civil Court for a period of two months from this date and also not to alienate any of the moveable properties of the tea shop. The plaintiff will take immediate steps to present the plaint in the proper Court and obtain the necessary orders, if so advised. The appellant is entitled to costs here and in the Court below.


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