R SARASWATHI Vs. SHAKTHI BENEFICIAL CORPORATION

JUDGEMENT

(1.) THIS is a petition under s. 583(1), (2) and (4)(b) read with s. 582 and s. 439(1)(b) of the Companies Act, 1956 (hereinafter referred to as 'the Act'), presented by five petitioners. They have alleged that they were subscribers to the respondent -firm, Shakthi Beneficial Corporation, a firm registered under the Indian Partnership Act, 1932, carrying on the business of chit fund transactions at Bangalore. The petitioners have prayed that the firm be wound up under the provisions of the Act, as the respondent -firm and its partners have failed to pay each of the petitioners the balance of their subscription amounting to Rs. 4,000 in each case together with bonus thereon in the sum of Rs. 341.65. Balance due to each of the petitioners is indicated as follows :

(2.) THUS , the petitioners are entitled to a sum of Rs. 16,708.25 together with interest as the balance due from the respondent -firm and its partners respondent Nos. 2 to 11. In spite of repeated demands, the firm has not paid the said amounts to each of the petitioners. Therefore, the petitioners allege that the respondent -firm and its partners are unable to pay its debts.

(3.) RESPONDENTS Nos. 7, 9, 10 and 11 are represented by counsel and have filed their statement of objections on July 27, 1979. In the said statements of objections they have averred primarily that the respondent -firm is not an unregistered company within the meaning of s. 582 of the Act and, therefore, it is not liable to be wound up under the Act. They have further alleged that respondents Nos. 2 to 11 are not partners in the firm on October 20, 1969, or on May 2, 1979, which latter dated is the date of filing of the petition. They have set out in detail that the respondent -firm was formed by respondents Nos. 2 to 4 and registered under the Partnership Act on October 20, 1969, together with one Shyamalal and another Shri P. S. Radhakrishna Shetty. It is further alleged that Shyamalal died and the firm was continued with the remaining partners. Later, respondent No. 5 was inducted in the year 1975. The aforementioned Radhakrishna Shetty, it is alleged, got himself released from respondent No. 1. It was only on October 5, 1978, that respondents Nos. 6 to 11 were inducted as partners and, therefore, they claim no liability for the transactions entered into by the firm prior to that date. It is further alleged that at the meeting held on March 4, 1979, respondents Nos. 5 to 11 have retired and a release deed was not executed in their favour. It is on the basis of these allegations, that the respondents have filed their objections, namely, respondents Nos. 7, 9, 10 and 11, raising the preliminary objection that seven members constituting the partnership to attract the provisions of s. 582 of the Act.