MOHAR SINGH Vs. SARDARI LAL

JUDGEMENT

(1.) In this suit for declaration of shares of the plaintiffs in the profit and loss and net assets of the dissolved partnership firm (w.e.f. 31.10.1994) Shri Giriraj Trading Company at 15% and 10% respectively and require the defendants to render true, just and correct accounts of the said partnership firm w.e.f. 17.1.1982 till the defendant continue to use the assets etc. of the partnership firm and for a preliminary decree directing the defendants to render accounts of the partnership firm M/s. Goverdhan Traders with a further prayer for the appointment of the Local Commissioner to go into the accounts of the firm, also requiring the defendants to render accounts to the plaintiffs,byl.A. 3862/95, under0rder39, Rules 1 & 2, CPC, the plaintiffs pray for ad interim injunction restraining the defendants from, in any manner, using the properties, goodwill and name of the partnership firm Shri Giriraj Trading Company and carrying on similar business in the firm's name Shri Giriraj Trading Company, also restraining the defendants from, in any manner, selling, transferring, alienating or otherwise disposing of the assets of the said partnership firm and also praying for the appointment of the receiver with respect to the assets and property of the firm with a direction to take charge of the firm; by IA No. 4562/95, the defendants, under Order 39, Rule 4, CPC, pray for the vacation of the order dated 5.5.1995 granted under Order 39, Rules 1 & 2, Civil Procedure Code in IA 3862/95.

(2.) The say of the plaintiffs is that a partnership was entered into between the plaintiffs and the defendants vide partnership deed dated 17.1.1982; that the partnership was to carry on the business of commission agency in Kiryana goods in the name of Shri Giriraj Trading Company; that plaintiff No. 1 and 2 and defendants No. 1 to 3 are the partners in the said firm and the share profit in the ratio of 15%, 10%, 40%, 10% and 25% respectively; that prior to the said partnership, plaintiff No. 2 and the defendants were the partners carrying on the same business w.e.f. 17.6.1978 with late father of the plaintiffs, namely Shri Prabhu Dayal as another partner therein; that Shri Prabhu Dayal died on 16.1.1982 at Delhi; that consequently, a deed of dissolution was entered into between plaintiff No. 2 and defendants on 17.1.1982 and on that date, a fresh partnership between the plaintiffs and the defendants came into existence with a fresh deed of partnership, which is the subject matter of this suit; that the partnership business between the plaintiffs and the defendants carried on from 17.1.1982 to 31.10.1994; that the said partnership was, at Will, dissolved by plaintiff No. 1 on 30.10.1994 through his legal notice dated 27.7.1994; that earlier, on 1.4.1994, another partnership deed was entered into between the parties due to changes into the provisions of Income Tax Act for the partners and the partnership firm; that the partnership deed contains the rights and obligations of the parties to the same as also the present suit, in great details; that the said partnership carried on business in the premises which belongs to the plaintiffs and that defendant No. 1, who has the requisite experience in the commission agency of Kiryana business, was in actual control and possession of the books of accounts; that even after the dissolution of the firm w.e.f. 31.10.1994, the defendants have most illegally and arbitrarily, not settled the accounts of the firm and have not paid the plaintiffs their just and true share of the assets and profits of the said firm; that the defendants are liable to account for the shares of the plaintiffs of the profits earned since dissolution; that the defendants are bound to stop the user of the premises and the goodwill, customers and trade name of the said partnership firm from 31.10.94 but the defendants are, however, with impunity continuing to use the goodwill, customers and trade name of the partnership firm. In substance, the say of the plaintiff is that the partnership between the plaintiffs and the defendants, was a partnership at Will. The said partnership has been dissolved w.e.f. 31.10.94 and despite the dissolution, the defendants have not been rendering the accounts of the profit and the assets of the partnership to the plaintiffs and that the defendants have been continuing the use of the goodwill, customers and trade name of the partnership firm.

(3.) As against this, the say of the defendants is that the suit of the plaintiffs is barred under the provisions of Order 2, Rule 2 CPC; that earlier plaintiffs had filed Suit No. 1052/95 against the defendants in respect of this very half portion of Shop No. 481; that Prabhu Dayal was a tenant of Shop Nos. 457,458 and 481 under Smt. Patashi Bai at Rs. 137.00 p.m. as rent; that Shops Nos. 457 and 458 are located in Khari Baoli whereas Shop No. 481 is situated in Katra Ishwar Bhavan, Khari Baoli, Delhi; that defendant No. 1 had been carrying on business of brokers in Chillies; in 1978 he thought of starting his own commission business in Chillies; Shop No. 481 was lying vacant and was not being used by said Prabhu Dayal; that defendant No. 1 approached said Prabhu Dayal, who refused to sublet the shop or portion thereof openly to defendant No. 1; he suggested that he could enter into a fictitious partnership with defendant No. 1, partition Shop No. 481 into two portions and hand over the possession of half portion to defendant No. 1; in the meanwhile, Shri Din Dayal, father of defendants 1 & 3 had retired from service in DCM; accordingly, said Prabhu Dayal divided Shop No. 481 into two portions by putting up iron sheet partition; that on 17.6.1978, a partnership deed was executed between the said Prabhu Dayal and his grand son Subhash Chand on one hand and defendants 1-3 on the other; that by means of the said partnership deed, which was merely a device, the said Prabhu Dayal sublet half portion of Shop No. 481 to the defendants; that this deed of partnership was merely fictitious and was not meant to be acted upon and was never acted upon. On the contrary, it was agreed between the parties that the defendants will pay rent @ Rs. 2,000.00 p.m. for half portion of Shop No: 481 opening in Katra Ishwar Bhavan; that said Prabhu Dayal also gave to the defendants in their portion of Shop No. 481, an extension of his telephone; that the defendants were paying the entire bill of that telephone including the calls made by Prabhu Dayal and his son and grand son. The defendants also were making investments and were carrying on the business of Chillies under the name and style of Shri Giriraj Trading Company; that the said partnership was merely entered into as a device to avoid and prevent eviction from the said premises; that Bank account was opened in 1978 in Canara Bank, Chandni Chowk, Delhi which was closed in 1980 and the current account was opened in Hongkong Bank, Chandni Chowk, Delhi; that the plaintiff has never issued a single cheque or withdrawn any amount; that neither the plaintiff nor late Shri Prabhu Dayal at any time entered into any bargain on behalf of the alleged partnership firm or made or received payment on its behalf; that the plaintiff and Prabhu Dayal were never the partners in reality in the business which the defendants were carrying on in half portion of Shop No. 481. Thus, according to the defendants, the partnership is a camouflage only to protect the possession and avoid eviction under Section 14(1)(v) of the Delhi Rent Control Act, 1958; that the plaintiffs are not entitled to any share in the profits nor liable for any losses and that the defendants are not liable to render accounts since the plaintffs and defendants are not the partners of each other and in fact the defendants are the sub-tenants in the suit shop.