Patna High Court
Bangali Singh @ Satya Nr.Singh vs Achhaibar Singh & Ors on 12 October, 2012
Author: Mungeshwar Sahoo
Bench: Mungeshwar Sahoo
IN THE HIGH COURT OF JUDICATURE AT PATNA
Second Appeal No.119 of 1986
Against the Judgment and Decree dated 01.02.1986
passed by the 8th Addl. District Judge, Rohtas at
Sasaram in title appeal No.78 of 1981 / 1 of 1983
dismissing the appeal and thereby confirming the
Judgment and Decree of the trial Court dated 18.8.81
passed by Ist Munsif, Sasaram in title suit No.66 of
1980.
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Bengali Singh @ Satyanarayan Singh & Ors
...................Defendants-Appellants-appellants
Versus
Girija Singh & Ors
...............Plaintiffs-Respondents-respondents
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Appearance :
For the Appellant/s : Mr. A. K. Singh Chauhan, Advocate
For the Respondent/s :
Mr. T. N. Maitin, Sr. Advocate
Mr. Ravi Shanker Sahay, Advocate
Mr. Ajay Nandan Sahay, Advocate
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Dated : 18thday of October, 2012
PRESENT
CORAM : THE HON'BLE MR. JUSTICE MUNGESHWAR SAHOO
CAV J U D G M E N T
Mungeshwar
Sahoo, J.1. The defendants-appellants appellants have filed this second appeal against the Judgment and Decree dated 01.02.1986 passed by the learned 8 th Addl. District Judge, Rohtas at Sasaram in title appeal No.78 of 1981 / 1 of 1983 whereby the lower appellate Court dismissed the appeal and thereby confirmed the Judgment and Decree dated 18.8.1981 passed by Ist Munsif, Sasaram in title suit No.66 of 1980.
2. The plaintiff-respondents filed the aforesaid suit for dissolution of partnership and for rendition of accounts. According to the original plaintiff, 2 Patna High Court SA No.119 of 1986 dt.18-10-2012 2/4 Achhaibar Singh, he and Bali Singh jointly purchased the piece of land in the year 1953. Subsequently, Bali Singh sold his half share in favour of plaintiff in the year 1967 and since then the plaintiff became the absolute owner of the property. Original plaintiff and Bali Singh had entered into an agreement for running a mill and for that they contributed half and half and the mill business was established. It was agreed that the plaintiff would be getting Rs.100/- as rent per month. After the death of Bali Singh, his two sons defendant No.1 and 2 continued to manage the partnership business. The entire account is with them but they were not prepared to give any account of the business. Hence the suit.
3. The defendants contested the suit alleging that in fact the land was purchased by late Bali Singh but the plaintiff got his name inserted in the sale deed mis-representing the facts and the sale deed executed by Bali Singh in favour of the plaintiff is forged and fabricated document. The mill business is exclusively belonged to the defendants.
4. The trial Court after trial recorded the finding that the mill business was started jointly by joint fund of Bali Singh and plaintiff. Section 69 of the Partnership Act does not bar the suit and the partnership stands dissolved on the date of the suit and accordingly decreed the plaintiff's suit. On appeal, the appellate Court also recorded the finding that the milling business was started by the plaintiff and late Bali Singh in partnership and the suit is not barred under Section 69 of the Partnership Act. The plaintiff has half share in the milling business and, therefore, he is entitled to a decree for rendition of account as prayed for and accordingly dismissed the appeal.
5. On 24.09.1986, at the time of admission of second appeal, the following substantial question of law was formulated :-
3 Patna High Court SA No.119 of 1986 dt.18-10-2012 3/4 "As to whether after dissolution of partnership whether the surviving partner may be compelled to render accounts for the period after dissolution".
6. The learned counsel for the appellant submitted that as soon as Bali Singh died, the partnership dissolved, therefore, the suit filed by the plaintiff for rendition of account against the defendant after automatic dissolution of the partnership was itself not maintainable and the defendants cannot be directed to give account. Both the Courts below have not considered this aspect of the matter. Therefore, the Judgment of both the Courts below are vitiated.
7. On the other hand, the learned senior counsel, Mr. T.N. Maitin appearing on behalf of the respondent submitted that the specific case of the plaintiff that after death of Bali Singh, the defendants were allowed to manage the milling business and, therefore, the partnership continued after death of Bali Singh also. When the defendants did not give any account, the plaintiff was compelled to file the suit.
8. So far the substantial question of law formulated is concerned, in the case of Haji Hidaytulla Vs. Md. Kamil 1924 Privy Council 93, it has been held where the partnership is dissolved by the death of a partner and the suit is filed for account, business is to be regarded as a continuing business upto the date of final decree.
9. The special Bench decision of the Allahabad High Court in the case of Narendra Bahadur Singh Vs. Chief Inspector of Stamp, U.P. A.I.R. 1972 Allahabad (1) held that the firm continues to exists till its affairs are finally and completely wond up. It has further been held that till the debt and liabilities of the firm have been fully paid up, no partner can claim any particular property as his own, nor can he claim that he has any specific share or interest 4 Patna High Court SA No.119 of 1986 dt.18-10-2012 4/4 in any property of the firm. It is only when after payment of all the debts and liabilities of the firm, there is a surplus lapses, that a partner can have the surplus distributed according to his rights. The accounts of the firm as between the partners have tobe settled, subject to agreement by them, in accordance with the rules stated in Section 48. It may be mentioned here that Section 42, 46, 48 of Partnership Act clearly provides that suit can be filed against heirs of partner also.
10. In the present case at our hand, it has been found by both the Courts below that after death of Bali Singh, the defendant continued to manage the firm and they did not provide any account. No specific provision has been pointed out by the appellant to show that the suit for rendition on account after death of Bali Singh is not maintainable. The Courts below held that after death of Bali Singh, the defendants continued to manage the milling business. In view of the above decisions of the Privy Council and also the Allahabad High Court, the suit can be filed for accounts and for that purpose, the business is to be treated as a continuing business. Here according to the plaintiff, the defendants continued to carry on the business, therefore, it cannot be said that they are not liable to give accounts for the business, particularly when they stepped into shoes of their father, Bali Singh.
11. In view of the above facts and circumstances of the case and position of law, the substantial question of law formulated is answered against the appellants and in favour of the plaintiffs-respondents. In the result, this second appeal is dismissed. No order as to cost.
(Mungeshwar Sahoo, J.) Patna High Court, Patna The 18thOctober, 2012 Sanjeev/N.A.F.R.