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Juggut Chunder Dutt Vs. Rada Nath Dhur - Court Judgment

LegalCrystal Citation
SubjectContract
CourtKolkata
Decided On
Judge
Reported in(1884)ILR10Cal669
AppellantJuggut Chunder Dutt
RespondentRada Nath Dhur
Cases ReferredRam Chunder Shaha v. Manick Chunder Banikya I.L.R.
Excerpt:
partnership - suit for an account--introduction of new member into firm--contract act ix of 1872, section 253, clause 6 and section 265--jurisdiction. - .....be inferred, that the business of the partnership had been carried on up to the time when the suit was brought in november 1880.8. the defendant no. 1 says that this was not so, and that the business came to a close at the end of the bengalee year 1286, which would be about the 11th of april 1880, or about a month after the plaintiff bought his share in the concern; and the defendant no. 1 also says, though the fact is not distinctly found by either court, that the sale of the share to the plaintiff was made secretly, and without his consent.9. now, the deputy commissioner is so far right in his view of the law that no partner has a right to transfer his share in the partnership to a stranger without the consent of the other partners. (see clause 6 of section 253 of the contract.....
Judgment:

Richard Garth, C.J. and Beverley, J.

1. The plaintiff's case is that the defendant No. 1 and a person named Gopal Chunder Dhur opened a shop and carried on business in co-partnership for about three years. Gopal Chunder Dhur then sold his share to the plaintiff; and the plaintiff says that after this purchase he continued to carry on the business with the defendant No. 1, but that the defendant No. 1, in collusion with the other defendants, who are his gohmastas, have been receiving moneys due to the firm, and keeping back papers and accounts in fraud of him, the plaintiff. He, therefore, brings this 'suit against them for production of the papers and for an account.

2. Two of the defendants say they have nothing to do with the partnership, and that they are merely employed as gohmastas. But the defendant No. 1 says that the business has been closed since the end of the Bengalee year 1286, and that nothing is due to the plaintiff.

3. The Munsif found, as a fact, that the business was closed at the end of the year 1286; but he considered that the plaintiff was entitled to the investigation which he claimed, and after appointing an ameen and examining the accounts, he made a decree in the plaintiff's favour for Rs. 442-15-12.

4. The Deputy Commissioner took a different view. He considered that the purchase by the plaintiff from Gopal Chunder Dhur of the share in the partnership was invalid, and that (apparently for that reason) the plaintiff had no right to sue the defendant for an account.

5. It has now been contended before us that the view taken by the Deputy Commissioner was wrong, and that the judgment of the Munsif ought to be restored.

6. We think it very doubtful, however, whether, upon the plaintiff's own showing, and upon the facts found by the Munsif, the plaintiff is entitled to a decree.

7. It is not actually stated in the plaint, although it may certainly be inferred, that the business of the partnership had been carried on up to the time when the suit was brought in November 1880.

8. The defendant No. 1 says that this was not so, and that the business came to a close at the end of the Bengalee year 1286, which would be about the 11th of April 1880, or about a month after the plaintiff bought his share in the concern; and the defendant No. 1 also says, though the fact is not distinctly found by either Court, that the sale of the share to the plaintiff was made secretly, and without his consent.

9. Now, the Deputy Commissioner is so far right in his view of the law that no partner has a right to transfer his share in the partnership to a stranger without the consent of the other partners. (See Clause 6 of Section 253 of the Contract Act.)

10. But the Deputy Commissioner does not quite understand the true meaning of this rule. Its effect is, not to render an assignment of a share in a partnership concern illegal or void as between the parties to the assignment, but only so far void as between those parties and the other partner or partners, as to cause an immediate dissolution of the partnership.

11. In other words, one partner cannot by assigning his share make any one else a partner in his stead with his co-partners; and therefore upon his assigning his share the partnership ceases to exist, unless the other partners consent to accept the purchaser as a partner in the place of the latter.

12. If they do so consent, the partnership may continue to be carried on as before. If they do not consent, the plaintiff would, upon the dissolution, have a right to sue, not as a partner, but as an assignee of the rights of his assignor in the partnership property, for an account of that property, and for such a distribution share as belonged to his assignor.

13. Now, in this case, it does not appear to have been distinctly found by either of the lower Courts whether the defendant No. 1 consented to receive the plaintiff as a partner in the concern or not. The defendant No. 1 says that the transfer was made secretly and without his consent; and, although he says that the business continued to be carried on for about a month after the transfer was made, it does not appear whether the plaintiff was considered to have any share in it.

14. It will be found that this point has a very material bearing upon the 1 question whether, in point of law, the plaintiff has any right to bring this suit.

15. If he never became a partner with the defendant No. 1, he might, as I have just now explained, have a right, not as a partner, but as an assignee of Gopal Chunder Dhur's shave, to sue for an account against the defendant No. 1, and the judgment of the Munsif may then be substantially right; although it is difficult to see how the plaintiff would have any right of suit against the defendants Nos. 2, 3 and 4 if they were only gohmastas.

16. If, on the other hand, the plaintiff, after the transfer to him, became a partner with the defendant No. 1 for ever so short a time, and that partnership came to an end on or about the 11th of April 1880, then we think this suit would come within Section 265 of the Contract Act, and could only be brought in the Court of the District Judge.

17. This principle seems now to be pretty clearly established by several decisions in this Court. It has led to a good deal of inconvenience and injustice that suits of this description should only be brought in the Court of the District Judge; but so long as that section continues to be the law, the Court has no power to prevent the mischief.

18. It was certainly a matter of doubt at one time, both in this Court and elsewhere, whether the provisions of Section 265 were not intended to provide additional remedy otherwise than by a regular suit in cases where a partnership had determined. But the Civil Procedure Code has provided no other proceeding except a regular suit, under which accounts may be taken under such circumstances; and it has accordingly been held in several subsequent cases in this Court that a regular suit is the only remedy, and. that such a suit can only be brought in the Court of the District Judge. See Prosad Dass Mullick v. Bussick Lall Mullick I.L.R. 7 Cal. 157; Ramayya v. Chandra Sekara Rau I.L.R. 5 Mad. 256; Harrison v. Delhi and London Bank I.L.R. 4 All 437; Sorabji Fardunji v. Dulabhbhai Hargovandas I.L.R. 5 Bom. 65; Ladubhai Premchand v. Revichand Venichand I.L.R. 6 Bom. 143; Ram Chunder Shaha v. Manick Chunder Banikya I.L.R. 7 Cal. 428. We think therefore that, as the Deputy Commissioner has misconceived the effect of the plaintiff's purchase, and as neither Court has tried what appears to be a very important question in the case, namely, whether the plaintiff ever really became a partner in the concern with the defendant No. 1, the case ought to go back to the Munsif's Court for re-trial; and if in the result it should turn out that the suit can only be brought in the Court of the District Judge, as being a suit by an accepted partner after determination of the partnership, the plaint should be given back to the plaintiff to be there presented. The plaintiff, we presume, will not be prejudiced, so far as limitation is concerned, because he would have brought this suit bond fide in a Court which has no jurisdiction to entertain it.


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