SHIVAGOUDA RAVJI PATIL Vs. CHANDRAKANT NEELKANTH SADAGE

JUDGEMENT

(1.) This appeal by certificate raises the question whether a minor who was admitted to the benefits of a partnership can be adjudicated insolvent on the basis of debt or debts of the firm after the partnership was dissolved, on the ground that he attained majority subsequent to the said dissolution, but did not exercise his option to become a partner or cease to be one of the said firm.

(2.) The facts are not in dispute and may be briefly stated. Mallappa Mahalingappa Sadalge and Appasaheb Mahalingappa Sadalge, respondents 2 and 3 in appeal, were carrying on the business of commission agents and manufacturing and selling partnership under the names of two firms "M. B. Sadalge" and "C. N. Sadalge", the partnership deed between them was executed on' October 25, 1946. At that time Chandrakant Nilkanth Sadalge, respondent 1 herein, was a minor and he was admitted to the benefits of the partnership. The partnership had dealings with the appellants and it had become indebted to them to the extent of Rs.1,72,484/-. The partnership was dissolved on April 18, 1951. The first respondent became a major subsequently and he did not exercise the option not to become a partner of the firm under S. 30 (5) of the Indian partnership Act. When the appellants demanded their dues, the respondents 2 and 3 informed them that they were unable to pay their dues and that they had suspended payments of the debts. On August 2, 1954, the appellants filed an application in the Court of the Civil Judge, Senior Division, Belgaum, for adjudicating the three respondents as insolvents on the basis of the said debts. The 1st respondent opposed the application. The learned Civil Judge found that respondents 2 and 3 committed acts of insolvency and that the 1st respondent had also become a partner and, therefore, he was also liable to be adjudicated along with them. The first respondent preferred an appeal to the District Judge, but the appeal was dismissed. On second appeal, the High Court held that the 1 st respondent was not a partner of the firm and, therefore, he could not be adjudicated insolvent for the debts of the firm. The creditors have preferred the present appeal against the said decision of the High Court.

(3.) learned counsel for the appellants, Mr. Pathak, contends that the 1st respondent had become a partner of the firm by reason of the fact that he had not elected not to become a partner of the firm under S.30 (5) of the Partnership Act and, therefore, he was liable to be adjudicated insolvent along with his other partners.