JUDGMENT
D.M. Bhandari, J.
1. This is a Civil Second Appeal against a final decree in a suit for rendition of accounts. The plaintiffs Jawanmal and Kaluram entered into a partnership with Bhagchand defendant on 31st October 1951. The partners agreed to share the profits, as under:
I. Jawanmal s/o Moolchand … As. 0-6-6 in rupee;
II. Kaluram Moolchand s/o
Tarachand … As. 0-6-6 Do.
III. Bhagchand s/o Bheraji … As. 0-5-6 Do.
It was agreed that the capital of the partnership shall be provided by the partners according to the needs of the Firm and that the capital of the Firm invested by each partner shall bear interest at 6 per cent per annum. According to the partners, the partnership came to an end on 8th June 1953. The plaintiffs prayed for a declaration that the partnership Firm stood dissolved and also for rendition of accounts. The defendant contested the suit. A preliminary decree was passed on 8th August 1957, in the following terms:
“1. It is declared that the firm M/s. Mool-chand Fatehchand shall stand dissolved from 11-6-1953;
2. It is further declared that the respective shares of the partners in the profits and losses of the said firm are as under:
(i) Jawanmal, plaintiff No. 1–Rs. -/6/6 (ii) Kaluram, plaintiff No. 2–Rs.-/6/6 (iii) Bhagchand, defendant–Rs. -/5/6″
It was further directed that-
“. . . .the account of the firm from 31-10-1951 to 11-6-1953 be taken by Commissioner Shri B.S. Singhi. In taking the accounts, the books of account of the firm shall be taken as prima facie evidence of the truth of the matter therein contained with liberty to the parties to take such objections thereto as may be advised. …………..”
The Commissioner submitted his report and the parties took objections to the report. The learned trial Judge decided the objections of the parties and decreed this suit for Rs. 4,511-1-6 Pies providing further that the plaintiffs will be entitled to recover interest at the rate of 6 per cent per annum on the decretal amount from the date of the suit till realization. The defendant preferred an appeal to the court of the District Judge, Pali, but the appeal failed. Hence this Second Appeal.
2. The first contention urged by the learned counsel for the appellant is that he was not given any opportunity by the trial Court to substantiate his objection filed before the Commissioner. In my opinion, this point has got no force, as pointed out by the lower Court. After the report of the commissioner had been received by the lower Court, objections were invited. The defendant filed objections on 20th February 1958. Thereafter issues were framed on 12th March 1958. The case was posted for defendant’s evidence on 9th April 1958 with the direction that if he wanted witnesses to be summoned through the court, he should deposit process fee within seven days, but this was not done. On the 9th of April, the defendant was examined and he requested for an adjournment to examine other witnesses which was allowed and 12th of April 1958 was fixed. One witness–Juharmal on behalf of the defendant was examined on that day and thereafter the evidence of the defendant was closed. It cannot be said in the circumstances of the case that the trial court had not afforded full opportunity to the defendant to substantiate his objection before the commissioner.
3. The second contention of the learned counsel for the appellant raises a point of law. His contention is that no doubt according to the deed of partnership, the plaintiffs were entitled to get interest at 6 per cent per annum on the capital invested by them, but such interest was payable only out of profits as there was no agreement between the parties that on the capital invested by the parties interest was payable irrespective of profit or loss. Learned counsel has relied on Section 13 of the Indian Partnership Act, the relevant part of which is, as follows:
“Subject to contract between the partners-
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(c) where a partner is entitled to interest on the capital subscribed by him such interest shall be payable only out of profits;”
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In my opinion, this contention must be accepted. Both the lower courts have awarded interest to the plaintiffs on their investments on the ground that there was a stipulation in the partnership deed that interest would be paid on all the investments but there was no stipulation that interest was payable irrespective of the fact whether there was profit or loss. Unless there is such stipulation, Section 13(c) of the Partnership Act comes into play, and interest is payable only out of profits. The deed of partnership provided for payment of interest on the capital to a partner which only means that the plaintiffs became entitled to interest on the capital subscribed by them but that such interest was payable only out of profits as laid down in Section 13(c) as there was no contract to the contrary.
4. The losses in the partnership in the instant case have been calculated after providing, for payment of interest at 6 per cent per annum on the capital invested by the plaintiffs. It is conceded before me by the learned counsel for the parties that if accounts are taken on the basis of the principles laid down by me in the preceding paragraph, the plaintiffs are entitled to a decree of Rs. 2,641-6-6 which, as found by the commissioner, was due to the plaintiffs on the basis of the khata of the defendant. This khata represented the withdrawals made by the defendant from the partnership Firm and on the money over-drawn by the partners from the partnership firm, interest is not to be allowed before the date of the final decree, unless there are special circumstances to make him liable to pay interest. The plaintiffs are, however, entitled to interest from the date of the final decree at 6 per cent per annum.
5. As a result of the aforesaid discussion, the judgment and decree dated 17th October 1958 of the District Judge, Pali are modified and instead of Rs. 4,511-1-6, the plaintiffs are awarded a decree for Rs. 2,641-6-6 Pies. The interest on this amount shall be payable to the plaintiffs by the defendant at 6 per cent per annum from the 26th of April 1958. The parties shall pay and receive costs in proportion to their success and failure in all the courts.