KALI RAM Vs. RAM RATAN

JUDGEMENT

(1.) The parties to this appeal are brothers who had entered into a partnership on 11th January, 1964. The business was to be carried on under the name and style of M/s. Gupta Handloom Stores on certain terms and conditions which will be analysed later to the extent necessary in this appeal. R am Rattan, the respondent in this appeal instituted a suit for dissolution of partnership and rendition of accounts slating that he had become a T.B. patient and had not been able to look after the business of the firm and, the defendant had taken some illegal steps to expel him from the business and had fabricated books of account and removed a major portion of the assets. Further, it was alleged that disputes had arisen between the parties and a reference was made to arbitration, but the arbitrators were unable to reach any decision. The plaintiff wanted a decree for dissolutisn of partnership and rendition of accounts. Kali Ram. the present appellant resisted the suit and claimed that he had served a notice on the plaintiff on 4th November, 1966, intimating that the partnership stood dissolved. He also contended that the capital investment of the plaintiff had been withdrawn and in fact, about Rs. 2,800.00 was due from the plaintiff to the defendant. Only two issues were framed by the court which were :--

(2.) On appeal to the Additional Senior Subordinate Judge by the present appellant it was held by the court that there was no error in the conclusion arrived at by the learned Subordinate Judge and accordingly the partnership was not one at will. The learned Additional Senior Subordinate Judge then proceeded to analyse whether the notice given by the present appellant on 4th November, 1966 was a valid notice and came to the conclusion that the notice was a had notice and did not dissolve the partnership. Having reached this conclusion, the learned, Additional Senior Subordinate Judge should have held that the partnership was not dissolved and could not have come to the conclusion that the accounting period was from 11th January, 1964 to 7th March, 1970.

(3.) I may mention, that although the scope of the suit was a very limited one, a very important question of law had arisen before the Subordinate Judge and the Senior Subordinate Judge which they have completely over-looked. This question was at to how a partnership- can be dissolved. If it is a partnership at will, then section 43 of the: Partnership Act applies. This Section states that where a partnership is at will, the firm may be dissolved by any partner by giving a notice in writing to the other partners and the firm is dissolved with effect from. the date mentioned in the notice. Thus, if this partnership was a partnership at will, this firm would be dissolved by the giving of the notice by the present appellant. Such a notice was in fact given on the assumption that the partnership was one at will. The date of that notice is 4th November, 1966. If I accept the finding of the two courts below to be correct and hold that the partnership is not one at wilt, then section 43 of the Act does not apply.