PREM KUMAR Vs. HARBANS SINGH

JUDGEMENT

(1.) , J.-

(2.) RESPONDENT Harbans Singh and appellant Prem Kumar formed a partnership on September 26, 1978 to run 'Rocket Circus' with its registered office at Karol Bagh, New Delhi. The initial investment of Rs. 60,000.00 was to be made in equal shares by each of the partners. Prem Kumar was responsible for running the business and maintain the accounts. The partnership was at will determinable by three months' notice on either side. The respondent invested in all Rs. 45,000/, while the appellant did not contribute anything towards the capital. The circus gave performances in Himachal Pradesh and Punjab, but the accounts received by the respondent showed a deficit of Rs. 34,000.00 . The respondent visited the circus at Nonik in Punjab, and discovered that a galary worth Rs. 20,000.00 was missing and the accounts were irregularly maintained. He served a telegraphic notice on the appellant on June 25, 1979 stating that the partnership stands dissolved with immediate effect, that no more business is to be transacted and that the matter will be referred to the arbitration of Shri M.S. Vallia. He received no response. Then he filed the present suit in the court of the Senior Sub-Judge under section 44 of the Partnership Act. He prayed that the firm be dissolved and accounts be taken. He complained that the defendant has misappropriated the funds, was making false accounts, the business of the firm can not be carried on same at a loss and it is otherwise just and equitable that the firm be dissolved.

(3.) I have considered upon all these aspects. The plaint does not give instances and particulars of misappropriation but it alleges that the defendant did not contribute any money and lived upon the earnings of the circus and falsified the accounts. He also borrowed money but refused to disclose the borrowers. These allegations do make out a case of fraud and misappropriation and the court may perhaps be better able to deal with them. A partnership is always established in order to attain a given objective. Where it becomes no longer possible to attain that objective with which the partnership was started, a case is made out for dissolution which may be the only remedy under the circumstances. The plaintiff could have but did not dissolve the partnership by three months' notice and instead has invoked the power of the court. I do not find anything in section 43 .of the Partnership Act which bars the discretionary powers of the court to dissolve a firm in the circumstances stated therein.