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Gulzarilal Marwari Vs. Ramgopal and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtKolkata
Decided On
Reported inAIR1937Cal765,173Ind.Cas.263
AppellantGulzarilal Marwari
RespondentRamgopal and ors.
Cases ReferredCo. of Copenhagen v. Da Costa
Excerpt:
- .....the plaintiff claims against the defendants as members of the firm of ramgopal choteylal on an account stated and adjusted in calcutta on 28th december 1931 in writing signed by the defendant choteylal for and on behalf of the firm ramgopal choteylal. further the plaintiff alleges that the defendants on the said date and at the same place agreed to pay to the plaintiff on demand the sum of rs. 1,334 being the amount due from them on the account stated and adjusted and also agreed to pay interest thereon at the rate of 14 annas per cent per month, and he claims the sum of rs. 1,758-8-0 for principal and interest.3. it is to be observed that he does not state whether the agreement to pay was in writing or not. choteylal has not appeared or filed any written statement. ramgopal and.....
Judgment:

Lort-Williams, J.

1. The plaintiff, Gulzarilal Marwari, carries on business in Calcutta and describes himself as a Hindu trader; presumably he is the proprietor of that business. He sues Ramgopal Choteylal, Fulchand, Baluram and Murlidhur who he alleges were lately carrying on business under the name and style of Ramgopal Choteylal at Chinsurah, and he describes them as Hindu traders. The plaint therefore is embarrassing because the plaintiff does not make clear whether he is suing them as members of a contractual partnership firm; or secondly whether he means that they are carrying on a joint family business, of which joint family they are the only members; or thirdly whether he is suing them as managing partners of a joint family business, of which joint family there are other members not named in the plaint.

2. As the case progressed, counsel appearing on behalf of the plaintiff appeared to be a little uncertain about the position, but gradually came to adopt the position that these persons are sued as the managing partners of a joint Hindu family business, of which joint family there are other cosharers who have not been mentioned in the plaint. The plaintiff claims against the defendants as members of the firm of Ramgopal Choteylal on an account stated and adjusted in Calcutta on 28th December 1931 in writing signed by the defendant Choteylal for and on behalf of the firm Ramgopal Choteylal. Further the plaintiff alleges that the defendants on the said date and at the same place agreed to pay to the plaintiff on demand the sum of Rs. 1,334 being the amount due from them on the account stated and adjusted and also agreed to pay interest thereon at the rate of 14 annas per cent per month, and he claims the sum of Rs. 1,758-8-0 for principal and interest.

3. It is to be observed that he does not state whether the agreement to pay was in writing or not. Choteylal has not appeared or filed any written statement. Ramgopal and Baluram did not enter appearance or file any written statement but they both appeared at the trial and asked to be heard, and I allowed them to cross-examine witnesses, and state their cases and give evidence on their own behalf. Fulchand and Murlidhur entered appearance and filed a joint written statement and have been represented by counsel. Their defence was that they were never members of the firm of Ramgopal Choteylal and that the partners of that firm were and are Ramgopal and Choteylal. Without prejudice to these objections, they state that the firm of Ramgopal Choteylal was dissolved some time in 1928-29. This allegation contradicts the one immediately preceding it. Further they deny that there was any adjustment in the writing signed by Choteylal, and that in any case he had no authority to bind the firm of Ramgopal Choteylal or these defendants. Further they allege that the adjustment not being properly stamped is not valid; that the claim is barred by, limitation, and that the suit is bad for non-joinder of parties and other defendants.

4. Mr. Bose's first contention on behalf of Fulchand and Murlidhur is that the document is not valid because it is not properly stamped. There is no substance in this contention. The adjustment, by which is meant the accounts stated and adjusted as alleged in the plaint, does not require to be stamped. What the defendants really mean by this contention is that the document in question is not an account stated or adjusted, but is a promissory note, and therefore requires to be stamped. Even so, this would not make the document invalid. Section 35, Stamp Act, provides that:

No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer unless such instrument is duly stamped.

5. The effect of the section is to make such an unstamped document; inadmissible in evidence, and unable to be acted upon by persons having authority to receive evidence or by any public officer. It does not affect the validity of the document There is a clear distinction to be draw between invalidity and inadmissibility of documents. Certain statutes and sections render documents invalid if they are not stamped. No section of the Indian Stamp Act has this effect, but an instance of a document being rendered invalid by the omission of stamps is contained in the English Stamp Act, Section 93 which provides:

A contract for sea insurance (other than such insurance as is referred to in Section 55, Merchant Shipping Act Amendment Act, 1862) shall not be valid unless the same is expressed in a policy of sea insurance;

and Section 97 provides that any person who enters into any contract for sea insurance, unless the insurance is expressed in a policy of sea insurance duly stamped, shall incur a fine of 100 for every such offence. Another instance is Section 28, Court fees Act, 7 of 1870, which provides that:

No document which ought to bear a stamp under this Act shall be of any validity, unless and until it is properly stamped.

6. The distinction arises again touching questions of unprofessional conduct. According to the rules laid down by the General Council of the English Bar, it is considered to be unprofessional conduct for counsel to raise objections to the admissibility of a document on the ground that it is not stamped, but there is no such objection to counsel raising an objection to the validity of a document which is by law rendered invalid owing to the absence of stamps. The distinction clearly is that in the one case counsel is taking an objection which is merely in the interest of the revenue authorities and does not touch the merits of the case, whereas in the other case the objection to the validity of the document strikes at the root of the matter, and is clearly relevant.

7. It is for the Court to take notice of the absence of the necessary stamps on a document and to refuse to admit it in evidence, although, as is pointed out in two cases to which I had occasion recently to refer, Home Marine Insurance Co., Ltd. v. Smith (1898) 1 Q B,829 and Genforsikrings Aktieselskabet (Scandinavia) Re-insurance Co. of Copenhagen v. Da Costa (1911) 1KB 137, the Court generally looks with disfavour upon objection taken merely on account of the absence of stamps, and may deprive the objector of costs. It follows therefore that in so far as this document is a promise to pay, it is inadmissible in evidence owing to the absence of the appropriate stamp. But the plaintiff relies on it as an account stated and adjusted, and so it is pleaded in his plaint. The document begins

Rs. 1334 brought forward, after totalling (making up) the account from another book. In words Rupees thirteen hundred and thirty four. We shall add (calculate) interest thereon at the rate of fourteen annas, 0-14-0, in the account. We shall calculate (interest) for one month in excess (for one excess month). The money (is) payable on behalf of (on account of) Bhai Gulzarilal;

and then comes the part which I hold amounts to a promise to pay,

We shall pay (you) the amount payable whenever you demand the same.

8. The document is signed 'Ramgopal Chhotay Lal by the hand of Chhotay Lal'. It is contended on behalf of the defendants that the first part of this document does not amount to an account stated, on the ground that there is nothing to show that any balance was struck between the parties. That is to say, there is nothing to show that this was anything more than a bill presented of the total of a number of items of the debit side only, with nothing on the credit side. But the plaintiff has given evidence and has stated that after some business had been done in ghee the account was adjusted and signed. Choteylal and Fulchand were present. He went on to say that in making the adjustment they compared the accounts with reference to the other books of account and the adjustment was made, and the defendants accepted the correctness of the figure. The whole entry was made by the hand of Choteylal.

9. There was no cross-examination on this point on behalf of the defendants and I must assume that the plaintiff used the word 'adjusted' in the ordinary sense, and therefore that a balance was struck between the parties. If it were the case that the document was a mere presentation of a bill of items all on the credit side, the word 'adjustment' would not be appropriate. In my opinion the first part of this document is an account stated between the parties, and in any case I find that the account was stated between the parties as alleged by the plaintiff. Such an account stated does not require to be stamped and therefore there is no objection to its admission in evidence.

10. With regard to the second part of the document, the plaintiff relies upon it as an agreement to pay interest. For such an agreement, the stamp on this document was insufficient, but the plaintiff has paid into Court the balance of the cost of the necessary stamp and the penalty imposed under Section 35, Stamp Act. I hold therefore that it is admissible as an agreement to pay interest. The last part amounts to a promise to pay and is inadmissible in evidence owing to the absence of an appropriate stamp. All these are merely technical objections, and the real point to be decided is whether the defendants or any of them are liable for this debt. As I have already said, the plaintiff has chosen to rely upon the contention that it is a joint family business carried on in the name of Ramgopal Choteylal, and that the business now being carried on by Fulchand and Muralidhar are all businesses which are being carried on by members of the family for the benefit of the joint family. Ramgopal, Choteylal and Fulchand are sons of one Ramprosad, now deceased: Baluram is the son of Ramkumar, their elder brother, also deceased, and Muralidhar is the son of Choteylal. Baluram, Ramgopal Muralidhar and Fulchand all have sons of their own.

11. The evidence on behalf of the plaintiff in support of this contention is vague and indefinite. It is true that Rich Pal who is the cousin of these brothers was more definite in his evidence, but I was not altogether favourably impressed by the way he gave it, nor satisfied that he was saying what he knew definitely to be true. Ramgopal gave evidence and I am inclined to think that he substantially has told the true story of this business except in certain particulars to which I will refer. His evidence is that he started this business with his own money and that it had nothing to do with the family property or with his father who was living at the time. He first called it Ramkumar Ramgopal, but Ramkumar had nothing to do with it. He used his name because he was his eldest brother. When Ramkumar died Ram Gopal induced Choteylal to come into the business with him although he was not able to put any money into it. Thereafter the firm was called Ramgopal Choteylal. This went on until about the time of the death of the father Ramprosad in 1925, when according to Ramgopal he turned over the whole of the business to Choteylal and thereafter had nothing to So with it.

12. One of the other witnesses confirmed this story, and when asked what became of the debts, he said quite frankly that those were turned over to Choteylal at the same time as the assets. Of course that would be a convenient way of getting rid of one's liabilities, but unfortunately for him it cannot be allowed to save Ramgopal from the obligations which he had incurred to the present plaintiff: nor do I believe his statement that he turned over this business to Choteylal and thereafter had nothing whatever to do with it. It is probably true that he left Chinsurah for the time being, and went to live in his native village in the Central Provinces and left Choteylal to carry on. But he made no attempt to notify those creditors who had supplied his firm with goods that there had been any dissolution of the partnership, and he allowed Chotaylal to carry on the business as before under the, name of Ramgopal Choteylal, and I am satisfied that this business was a partner ship business of which the two partners were Ramgopal and Choteylal, and that there has never been any dissolution of that partnership. Further I find that Baluram and Fulchand never had any interest in that business, nor were or are partners in it, nor are they liable for this claim. There must be judgment for the plaintiff for the sum claimed with costs against Ramgopal and Choteylal. There will be judgment in favour of the other defendants but there will be no order for costs.


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