{"id":48150,"date":"2010-01-14T00:00:00","date_gmt":"2010-01-13T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/c-k-kunheethu-vs-a-m-kadher-on-14-january-2010"},"modified":"2014-03-20T07:13:54","modified_gmt":"2014-03-20T01:43:54","slug":"c-k-kunheethu-vs-a-m-kadher-on-14-january-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/c-k-kunheethu-vs-a-m-kadher-on-14-january-2010","title":{"rendered":"C.K.Kunheethu vs A.M.Kadher on 14 January, 2010"},"content":{"rendered":"
Kerala High Court<\/div>\n
C.K.Kunheethu vs A.M.Kadher on 14 January, 2010<\/div>\n
       \n\n  \n\n  \n\n \n \n  IN THE HIGH COURT OF KERALA AT ERNAKULAM\n\nAS.No. 536 of 1996()\n\n\n\n1. C.K.KUNHEETHU\n                      ...  Petitioner\n\n                        Vs\n\n1. A.M.KADHER\n                       ...       Respondent\n\n                For Petitioner  :SRI.K.R.KURUP,C.R.SYAMKUMAR\n\n                For Respondent  :SRI.T.KRISHNANUNNI\n\nThe Hon'ble MR. Justice P.BHAVADASAN\n\n Dated :14\/01\/2010\n\n O R D E R\n                            P. BHAVADASAN, J.\n                 - - - - - - - - - - - - - - - - - - - - - - - - - - -\n                           A.S. No. 536 of 1996\n                - - - - - - - - - - - - - - - - - - - - - - - - - - - - -\n               Dated this the 14th day of January, 2010.\n\n                                   JUDGMENT\n<\/pre>\n
           The plaintiff, who was non-suited by the court<\/p>\n
below is the appellant.\n<\/p>\n
           2. The plaintiff along with three others formed a<\/p>\n
partnership firm. They decided to conduct transport service.<\/p>\n
For the said purpose they purchased a lorry bearing<\/p>\n
Registration No. KRK 2205. Ext.A1 is the partnership deed.<\/p>\n
Lorry was purchased under hire purchase scheme. The first<\/p>\n
defendant was put in possession of the vehicle and to maintain<\/p>\n
and run the same. He was to keep the accounts also.<\/p>\n
           3. According to the plaintiff, at the time of entering<\/p>\n
into the partnership and thereafter he had to go abroad. He<\/p>\n
used to come to his native place occasionally. Whenever he<\/p>\n
attempted to get the details of accounts of the lorry service, the<\/p>\n
first defendant used to postpone the submitting of the same<\/p>\n
under one pretest or other.                       Finally, the plaintiff was<\/p>\n
A.S.536\/1996.                     2<\/span><\/p>\n
constrained to send Ext.A2 notice dated 13.7.1993. First defendant<\/p>\n
chose to sent a false reply. The plaintiff was constrained to seek<\/p>\n
dissolution of partnership and accounts. He however restricts his<\/p>\n
claim to Rs.56,000\/-.\n<\/p>\n
             4. The first defendant resisted the suit. He admitted the<\/p>\n
partnership agreement. He pointed out that the registration of the<\/p>\n
vehicle stood in the name of Ashraf and since the lorry was<\/p>\n
purchased under hire purchase, the registration certificate could<\/p>\n
not be transferred in the name of the partners of the firm. He also<\/p>\n
admitted that he was conducting the service for sometime, and<\/p>\n
accounted the profit and loss to one Koya, the brother-in-law of<\/p>\n
the plaintiff, who was nominated by the other three partners to look<\/p>\n
after the affairs. Soon thereby the business ran into a loss. When<\/p>\n
this was informed to the other partners, the third defendant took<\/p>\n
over the business and employed another driver. That too did not<\/p>\n
result in any progress. Thereafter this defendant would say that the<\/p>\n
third defendant sold the vehicle to one Manalath Mohammed and<\/p>\n
A.S.536\/1996.                     3<\/span><\/p>\n
he purchased a jeep. Later the jeep was also disposed of . This<\/p>\n
defendant would contend that the partnership came to an end by<\/p>\n
sometime in 1987 and there was no partnership available for<\/p>\n
dissolution. On the basis of these contentions, he prayed for a<\/p>\n
dismissal of the suit.\n<\/p>\n
             5.  The third defendant filed a written statement<\/p>\n
supporting the plaintiff. He too would contend that without the<\/p>\n
consent or knowledge or the other partners, the first defendant had<\/p>\n
disposed of the vehicle.       He too sought for dissolution of<\/p>\n
partnership and his share of profits.\n<\/p>\n
             6. The second defendant chose to remain ex-parte.<\/p>\n
             7.  The court below framed necessary issues for<\/p>\n
consideration. The evidence consists of the testimony of P.W.1<\/p>\n
and the documentary evidence marked as Exts.A1 to A3 from the<\/p>\n
side of the plaintiff. The defendant had examined D.W.1 and<\/p>\n
marked Exts.B1 and B2. On a consideration of the evidence before<\/p>\n
it, the court below came to the conclusion that the partnership had<\/p>\n
A.S.536\/1996.                      4<\/span><\/p>\n
ceased to exist long ago and therefore the plaintiff is not entitled to<\/p>\n
any relief. Accordingly the suit was dismissed. The said judgment<\/p>\n
and decree are assailed in this appeal.\n<\/p>\n
             8. The only question that arises for consideration is<\/p>\n
whether the finding of the court below is correct.<\/p>\n
             9. The constitution of the firm and purchase of the lorry<\/p>\n
are admitted. It is also admitted by the first defendant that he was<\/p>\n
in possession of the vehicle and running the business initially. He<\/p>\n
has however pointed out that as per Ext.A1 partnership agreement,<\/p>\n
he was to submit all the accounts to one Mr. Koya, the nominee of<\/p>\n
the other partners and he was to supervise the business. He has<\/p>\n
been promptly accounting and he has not committed any laches in<\/p>\n
that regard. Further contention of the first defendant is that since<\/p>\n
the business began to run at a loss, he informed the partners and<\/p>\n
the business was taken over by the third defendant. Later he would<\/p>\n
contend that the third defendant sold the vehicle with the consent<\/p>\n
A.S.536\/1996.                     5<\/span><\/p>\n
of all the partners and purchased a jeep. He would say that he had<\/p>\n
no liability to account and he had not committed any default.<\/p>\n
             10. The court below, on an appreciation of the evidence<\/p>\n
found that the claim of the first defendant is established and there<\/p>\n
was no partnership to be dissolved. The court below held that the<\/p>\n
conduct of the parties would show that there is an implied<\/p>\n
agreement to dissolve the partnership       and accordingly it was<\/p>\n
dissolved. Even if later on some of the partners conducted the<\/p>\n
business, it could be construed only as a reconstituted firm.<\/p>\n
             11.   Learned counsel appearing for the appellant<\/p>\n
pointed out that the court below was not justified in coming to the<\/p>\n
above conclusion. Learned counsel drew the attention of this court<\/p>\n
to the provisions of the Indian Partnership Act and pointed out that<\/p>\n
the Act provides for the methods of dissolution of a firm. The<\/p>\n
relevant provisions, according to learned counsel, are Sections 40,<\/p>\n
41, 42, 43 and 44. The present claim of the first defendant that the<\/p>\n
firm was dissolved does not come under any of those provisions<\/p>\n
A.S.536\/1996.                      6<\/span><\/p>\n
and therefore it could not be contended by him that the firm was<\/p>\n
dissolved. Learned counsel also contended that may be that the<\/p>\n
firm had become defunct. But that is far from saying that it is<\/p>\n
dissolved and the liability of the first defendant to account for the<\/p>\n
profit and loss continues.     Since the partners do not wish to<\/p>\n
continue, they seek dissolution.      In support of his contention,<\/p>\n
learned counsel relied on the decision reported in Mangilal v.<\/p>\n
Bhanwarlal (AIR 1963 Rajasthan 153). In the said it was held as<\/p>\n
follows:\n<\/p>\n
             “Where dissolution by agreement is put forward<\/p>\n
      as a foundation for a suit for accounts, a mere closing<\/p>\n
      of the business or the failure of some of the members of<\/p>\n
      the partnership to take interest in its affairs, or the<\/p>\n
      mere vacating of the shop where the business was<\/p>\n
      carried on or the discharge of its servants would not be<\/p>\n
      enough to constitute “dissolution”. For the firm may<\/p>\n
      still continue its existence in order to recover its<\/p>\n
      outstandings or to pay of its debt, and, if so, the jural<\/p>\n
      relation between the various partners would still<\/p>\n
      subsist. Therefore whether dissolution of a firm has<\/p>\n
A.S.536\/1996.                    7<\/span><\/p>\n
      been brought about or not would, in the ultimate<\/p>\n
      analysis depend on the intention of te parties and<\/p>\n
      where there is no document in the shape of a public<\/p>\n
      notice or otherwise, evidencing such intention, the<\/p>\n
      same will have to be gathered from the facts and<\/p>\n
      circumstances of a given case and if the collective<\/p>\n
      effect thereof should unequivocally an unmistakably<\/p>\n
      lead to the inference of dissolution, then such a result<\/p>\n
      may weil be inferred. It must also be borne in mind in<\/p>\n
      this connection that according to Indian law of<\/p>\n
      partnership, mere assignment by a partner of his entire<\/p>\n
      interest in the partnership to a stranger does not and<\/p>\n
      cannot    have  the   consequence    of   disrupting  a<\/p>\n
      partnership business.”\n<\/p><\/blockquote>\n
             12.  Learned counsel appearing for the contesting<\/p>\n
respondents on the other hand pointed out that he had no quarrel<\/p>\n
with the proposition that the partnership can be dissolved only<\/p>\n
under one of the modes provided under the Act. One of the modes,<\/p>\n
according to the learned counsel, is by agreement of partners.<\/p>\n<\/blockquote>\n
Learned counsel stressed that it is not necessary that there should<\/p>\n
A.S.536\/1996.                     8<\/span><\/p>\n
be an express agreement to that effect and it could be implied from<\/p>\n
conduct. That is what the court below has precisely done. An<\/p>\n
impartial analysis of the evidence in the case will clearly reveal<\/p>\n
that the parties had put an end to the partnership long ago and the<\/p>\n
plaintiff and the third defendant were taking undue advantage out<\/p>\n
of the situation.\n<\/p>\n
             13. At the outset itself, it may be noticed that for the<\/p>\n
plaintiff, his power of attorney has been examined. While the<\/p>\n
power of attorney may be competent to say about the things which<\/p>\n
are known to him, it has been held that he is incompetent to speak<\/p>\n
about the matters which are within the exclusive personal<\/p>\n
knowledge of the plaintiff. [See the decisions reported in Shaji v.<\/p>\n
Reghunandanan 1(999(3) KLT SN 82) and Anirudhan v. Philip<\/p>\n
Jacob<\/a> (2006(3) K.L.T. 554)].\n<\/p>\n
             14. In Ext.A1 agreement, it is seen stated that the first<\/p>\n
defendant has to initially run the business.        But, Clause 6 is<\/p>\n
relevant in the present context. It states that the first defendant had<\/p>\n
A.S.536\/1996.                      9<\/span><\/p>\n
to maintain proper accounts and he has to present them to one<\/p>\n
Koya, who is closely related to the other partners.         The first<\/p>\n
defendant has to convince Koya about the accounts and Koya was<\/p>\n
to supervise the business.\n<\/p>\n
             15.  It is seen that Koya was not examined by the<\/p>\n
plaintiff. It is not clear as to what had prevented the plaintiff from<\/p>\n
examining the said Koya. True, he is also related to the plaintiff.<\/p>\n
But a reading of Ext.A1 would clearly revel that Koya was in fact a<\/p>\n
nominee of the other three partners, who were working abroad.<\/p>\n
One shall not forget the fact that Koya is the brother-in-law of the<\/p>\n
plaintiff.\n<\/p>\n
             16. P.W.1 in his chief examination says about the case<\/p>\n
of the plaintiff.    He would say that even though there were<\/p>\n
repeated demands from the part of the plaintiff for accounts, the<\/p>\n
first defendant did not submit the same. He would complain that<\/p>\n
the vehicle had been sold without the knowledge and consent of<\/p>\n
the plaintiff. It is interesting to note that in cross-examination he<\/p>\n
A.S.536\/1996.                      10<\/span><\/p>\n
says that he had no idea about the terms of the contract, which<\/p>\n
constituted the partnership.    It is clear from his evidence that<\/p>\n
defendants 2 and 3 are his close relatives. To certain questions<\/p>\n
regarding the remittance of the amounts in Bank obtained by<\/p>\n
plying the lorry, P.W.1 pleads ignorance.        When it was very<\/p>\n
specifically put to him that the first defendant had submitted all the<\/p>\n
accounts to Koya, this witness had stated that he had no idea. It<\/p>\n
could thus be seen that to certain crucial and important questions,<\/p>\n
his answer was that he does not know. This is no reason as to why<\/p>\n
the plaintiff should remain away from the box.<\/p>\n
             17. The first defendant examined himself as D.W.1.<\/p>\n
He has spoken about his case in detail. There is no challenge to his<\/p>\n
version that he had submitted the accounts to Mr.Koya and that<\/p>\n
the vehicle had been sold by the third defendant after getting the<\/p>\n
consent of all the partners.       One must notice here that the<\/p>\n
complaint of P.W.1 is that the transfer of the lorry was not<\/p>\n
informed to the plaintiff. P.W1 says that he had no idea about the<\/p>\n
A.S.536\/1996.                      11<\/span><\/p>\n
contents of Exts.A2 and A3, which are the notice and reply notice<\/p>\n
respectively.\n<\/p>\n
             18. The evidence in the case reveals that the lorry was<\/p>\n
sold in 1987. There is nothing to indicate that the first defendant<\/p>\n
had ever run a jeep on behalf of the firm. It is significant to notice<\/p>\n
that the defendants had produced Ext.B1 agreement, which shows<\/p>\n
that the third defendant had entered into an agreement to transfer<\/p>\n
the lorry involved in these proceedings to a stranger. This would<\/p>\n
clearly show that the claim of the first defendant that long ago he<\/p>\n
had ceased to be in possession of the vehicle is true. It also belies<\/p>\n
the claim of the plaintiff that other partners were unaware of the<\/p>\n
transaction relating to the transfer of the lorry.<\/p>\n
             19. It is true that the Indian Partnership Act provides<\/p>\n
for various modes of dissolution. One such mode contained in<\/p>\n
Section 40, which provides for dissolution of the firm with the<\/p>\n
consent of all the partners. It is settled law that in case of a<\/p>\n
A.S.536\/1996.                     12<\/span><\/p>\n
partnership at will, sending a notice in writing to all other partners<\/p>\n
is sufficient.\n<\/p>\n
             20.  Admittedly in the case on hand, there is no<\/p>\n
agreement evidencing the dissolution of the firm on consent of all<\/p>\n
the partners. But it is useful to refer to a passage from Indian<\/p>\n
Partnership Act – Pollock and Mulla, Seventh Edition, page 201,<\/p>\n
wherein it is referred to a follows:\n<\/p>\n
             “In cases of express agreement to dissolve the<\/p>\n
      firm between all the partners, barring questions as to<\/p>\n
      its construction and effect, no problem arises.<\/p>\n
      However, circumstances may also indicate existence of<\/p>\n
      such agreement and consequential dissolution. It has<\/p>\n
      now been affirmatively decided that the doctrine of<\/p>\n
      repudiation has the same applicability to partnerships<\/p>\n
      as in the case of other contracts. The repudiation of<\/p>\n
      the partnership by one or more of the partners which is<\/p>\n
      accepted by the others would indicate an an implied<\/p>\n
      agreement to dissolve.       Dissolution may also be<\/p>\n
      inferred where the service by a partner or his partners<\/p>\n
      of an invalid notice to determine the partnership is<\/p>\n
A.S.536\/1996.                     13<\/span><\/p>\n
      accepted by the co-partners as a valid notice or where<\/p>\n
      the conduct of the partners is inconsistent with the<\/p>\n
      continuance of partnership.      In a case where in a<\/p>\n
      partnership at will, notice of dissolution was given to<\/p>\n
      the other partner who did not do anything in respect of<\/p>\n
      the notice or partnership business for about three years<\/p>\n
      after the notice, it was held that failure to do anything<\/p>\n
      amounted to consent for dissolution.<\/p><\/blockquote>\n
             21. The fact remains that till 1993 there was no demand<\/p>\n
from the part of the plaintiff seeking accounts or any other details<\/p>\n
regarding the business. Ext.B1 dated 25.10.1987 clearly shows<\/p>\n
that the third defendant was aware of the entire facts and it was in<\/p>\n
fact he who had sold the vehicle to a stranger. The plaintiff has no<\/p>\n
case that the third defendant was on enimical terms with him. One<\/p>\n
must remember that going by Ext.A1 Koya is the common nominee<\/p>\n
of the plaintiff and defendants 2 and 3. When the third defendant<\/p>\n
admitted to sell the vehicle, Koya must have known about the<\/p>\n
same. The plaintiff has also no case that that Koya had betrayed<\/p>\n
him.\n<\/p>\n
A.S.536\/1996.                     14<\/span><\/p>\n
             22. It was the above facts and circumstances, which has<\/p>\n
persuaded the court below to hold that the claim of the plaintiff is<\/p>\n
absolutely false and he is aware of the entire transaction and he has<\/p>\n
consented to the same. Therefore, the court below had found that<\/p>\n
there is an implied agreement between the partners for the<\/p>\n
dissolution of the firm. The finding of the court below seems to be<\/p>\n
fully justified going by the evidence on record.<\/p>\n
             No interference is called for with the judgment and<\/p>\n
decree of the court below. The appeal stands dismissed with costs<\/p>\n
to the contesting respondents.\n<\/p>\n<\/p>\n
                                                P. BHAVADASAN,
\n                                                    JUDGE<\/p>\n
sb.\n<\/p>\n
A.S.536\/1996.    15<\/p>\n
                               P. BHAVADASAN, J.\n<\/p>\n
                     – – – – – – – – – – – – – – – – – – – – – – – – – – –\n<\/p>\n
                               A.S. No. 536 of 1996\n<\/p>\n
                     – – – – – – – – – – – – – – – – – – – – – – – – – – –\n<\/p>\n<\/p>\n
                                    JUDGMENT<\/p>\n
                                   14.01.2010.\n<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"
Kerala High Court C.K.Kunheethu vs A.M.Kadher on 14 January, 2010 IN THE HIGH COURT OF KERALA AT ERNAKULAM AS.No. 536 of 1996() 1. C.K.KUNHEETHU … Petitioner Vs 1. A.M.KADHER … Respondent For Petitioner :SRI.K.R.KURUP,C.R.SYAMKUMAR For Respondent :SRI.T.KRISHNANUNNI The Hon’ble MR. Justice P.BHAVADASAN Dated :14\/01\/2010 O R D E R P. BHAVADASAN, J. – – – […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,21],"tags":[],"class_list":["post-48150","post","type-post","status-publish","format-standard","hentry","category-high-court","category-kerala-high-court"],"yoast_head":"\nC.K.Kunheethu vs A.M.Kadher on 14 January, 2010 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/c-k-kunheethu-vs-a-m-kadher-on-14-january-2010\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"C.K.Kunheethu vs A.M.Kadher on 14 January, 2010 - 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