Skip to content


Magnamoyi Rai Vs. Brojendra Lal Das Chowdhury and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1928Cal127
AppellantMagnamoyi Rai
RespondentBrojendra Lal Das Chowdhury and ors.
Cases ReferredK. Runga Reddi v. Subbiah Setty
Excerpt:
- .....out and the present suits were brought by the plaintiff. the first suit which we will call the money suit was for recovery of a sum of money, being one-third share of the plaintiff in certain ornaments and cash which were in the iron safe of the firm and were wrongly taken away by the defendants. her case against defendant 1 was that he in collusion with the partners, misappropriated the ornaments and cash taken out of the iron safe. there were four more defendants, the neighbouring shop-keepers, who were said to have helped the other defendants in the taking out of the money and articles. the defence was that the plaintiff's brother rama charan was at one time acting as the manager of the firm and he was dismissed because 01 his defalcations, and defendant 1 was requested by the.....
Judgment:

1. The plaintiff and defendants 6 to 8 in the first suit who are defendants 2 to 4 in the second suit, were partners in a business. They fell out and the present suits were brought by the plaintiff. The first suit which we will call the money suit was for recovery of a sum of money, being one-third share of the plaintiff in certain ornaments and cash which were in the iron safe of the firm and were wrongly taken away by the defendants. Her case against defendant 1 was that he in collusion with the partners, misappropriated the ornaments and cash taken out of the iron safe. There were four more defendants, the neighbouring shop-keepers, who were said to have helped the other defendants in the taking out of the money and articles. The defence was that the plaintiff's brother Rama Charan was at one time acting as the manager of the firm and he was dismissed because 01 his defalcations, and defendant 1 was requested by the other partners to help them in the payment of creditors and for that purpose money was taken out of the safe and applied in the payment of the debts of the firm. As regards the ornaments the defendants were willing to produce them in Court and to abide by the order of the Court with regard to their disposal. The Munsif who tried the case found that the defendant's version of the story was true and the suit for money was dismissed and it was decreed in respect of the one-third share of the plaintiff in the ornaments. The lower appellate Court upheld the decree of the trial Court and hence this appeal by the plaintiff. At the hearing the suit was withdrawn as against defendants 6 to 8 (partners,) who were dismissed from the suit. On the findings of the trial Court which were endorsed by the lower appellate Court we do not think that there is any question in this case which entitles us to interfere with the decree. The finding is that defendant 1 who is a highly respectable man under the authority of the other partners took out the money and paid the debts of the firm with great advantage to the firm, the debts being paid off at 55 per cent. That there was no misappropriation by defendant 1 and that the present suit was instituted apparently at the instigation of Rama Charan, the brother of the plaintiff. On these findings no question of law arises and the suit was rightly dismissed. Appeal No. 84 is dismissed with costs.

2. The other suit which may be called the title suit was. brought by the plaintiff for recovery of one-third share in the sale proceeds of the stock-in-trade Defendant 1 is Brojendra Lal Das Chowdhury, who was defendant 1 in the other suit, and his defence is that he acted bona fide under instructions from the other partners. On the findings there can be no question that the suit was rightly dismissed against him.

3. As regards the claim against the partners the Munsif found that the amount of debt paid off by the other partners far exceeded the value of the stock-in-trade as put by the plaintiff. He also held that the suit was not maintainable without a general suit for accounts as between partners. In this view the suit was dismissed. The Subordinate Judge in appeal did not discuss the merits of the case, but dismissed the appeal on the ground that the suit in the form against the partners was not maintainable. The learned vakil for the appellant argues that the view of the lower appellate Court on law is wrong as the suit was maintainable. There can be no question that the general rule of law is that a suit by a partner after the dissolution of the partnership must be for a general account unless special circumstances exist which entitle one partner to bring a suit against another or others for a particular item. But if the suit relates to the loss and profits of the partnership business or to the stock-in-trade or capital employed in the business in respect of which all partners have equal rights, it must be one for a general account of the partnership business. But maintains the learned vakil for the appellant that an action for a specific sum, as for the price of the plaintiff's share in the sale proceeds of the stock-in-trade, is maintainable without a suit for accounts. He also contends that if in order to give proper relief if, is necessary to take accounts from the defendants the Court should take such accounts.

4. With reference to the second branch of the argument it may be said that the first Court did go into the question and found that the other partners used the proceeds of the sale of the stock-in-trade in paying off the debts and they will not, therefore, be liable. As to the first contention our attention has been drawn to the decision in the case of Durga Prosonno Bose v. Raghu Nath Dass (1893) 26 Cal. 254. In that case one partner under arrangement amongst the partners borrowed a sum of money and put it into the partnership till. Subsequently the creditor by a suit against that partner realized the amount. Thereupon the partner sued his other partners for contribution of the money which he had to pay under the decree of his creditor. The learned Judges held that such a suit was maintainable without a general suit for accounts on the ground that the money secured by the promissory note for which the suit was brought against the plaintiff did not become an item of the partnership accounts. On the facts of that particular case the decision seems to be perfectly justifiable. One partner had to contribute to the capital of the firm out of which profit was received by all the partners in equal shares, and if that partner had to pay the money which he had so employed in the partnership business, there does not seem to be any reason why he could not recover by way of contribution the share of the debt payable by the other partners. The suit had nothing to do with the partnership business or with reference to the assets of the partnership. The learned Judges in that case went thoroughly into the law as to the rights of partners amongst themselves. But on the facts if that particular case it was evident that the general rule, that a suit between partners relating to the partnership business must be a suit for general accounts of the dissolution, did not apply. Moreover, the rule has been stated in Lindley on Partnership, 9th edition, p. 663 in answer to a question formulated by the learned author:

When can an action be maintained between partners without taking a general account, of all the partnership dealings and transactions;

5. This question, according to the learned author,

can only be answered generally by saying that each case must depend upon its own circumstances and upon whether justice can really be done without taking such account.

6. In the present case it must be admitted that the plaintiff cannot sue for a specific sum without calling upon the other partners to show how the price of the stock-in-trade was applied by them, in other words, she cannot bring a suit for a specific sum without a general suit for accounts for the purpose of ascertaining if she is entitled to a share in the assets of the firm. In Ram Chandra Pal v. Krishna Lal Pal (1912) 17 C.W.N. 351, a suit was brought in the Small Causes Court by one of the partners for a sum of money alleged to be due by the other partners. The question before the Court was whether the suit was maintainable in the Court of Small Causes. The learned Judges held that a dispute between partners, whose business has come to an end regarding the division of the assets, can only be finally settled in a proper suit for adjustment of accounts; and it is not proper that each of the parties should proceed by separate suits in order to recover from the others any sum due to the partnership business which they may have realized. We have also been referred to the case of K. Venkata Reddi v. K. Narasayya (1909) 32 Mad. 76, but we do not see what bearing that case has on the facts of the present case. There, under the terms of the contracts between the partners, the working partner was to make over all the cheques and moneys received by him to the capitalist partner. He had omitted to do so and a suit was brought by the partner supplying the capital for the recovery of the cheques. It was held that a suit did lie. There is no special contract; in this case and in our opinion the general law must prevail, namely, that the plaintiff cannot maintain a suit for her share in the assets of the partnership without bringing a suit for a general account.

7. We further do not think that in the present case it was the duty of the Court to take accounts from the defendants and give proper relief to the plaintiff. As has been held in Kshetranath Banerjee v. Kalidasi Dasi (1917) 27 C.L.J. 96, a suit for recovery of a specific sum of money does not assume the character of a suit for accounts merely because in the determination of the question in controversy accounts may have to be examined. Though the question before the Court then was whether the suit was maintainable in the Small Causes Court the general principle that a suit for a specific sum of money cannot be converted into a suit for accounts is sound. To the same effect is the case of K. Runga Reddi v. Subbiah Setty (1904) 28 Mad. 394 in which it is stated that a suit for an account is a special form of suit in which a special process is required for the purpose of taking accounts and that every case in which accounts have to be looked into to ascertain the amount due to the plaintiff cannot he said to be a suit for accounts. In our judgment the suit, as brought by the plaintiff, is not maintainable and the plaintiff is entitled to no relief. It would not have been necessary, on the findings of fact arrived at by the trial Court, to go into the question of law but for the extremely unsatisfactory judgment of the lower appellate Court which gave sufficient indication that the learned Subordinate Judge did not fulfil his function as presiding over the appellate Court. This appeal is accordingly dismissed with separate costs to respondent 1 and to respondents 2 to 4.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //