S MOHAMED ISMAIL Vs. M S MOHAMED ESSA

JUDGEMENT

(1.) THE plaintiffs in the suit are the appellants. Their suit was for a permanent injunction restraining the defendants from opening and carrying on a business in city limits similar to that of the plaintiffs under the name and style of "m. M. Mohammed Saleh" or any other name which is deceptively similar to it. First plaintiff and the first defendant are brothers. They were conducting a registered partnership at No. 1-79 Sembudoss St. , G. T. Madras. The first defendant retired from the partnership. Under clause (8) of the partnership deed, the outgoing partner shall not be entitled to the goodwill or to any payment on account of the goodwill and shall not be entitled to open a similar business in the name of 'm. M. Mohammad Saleh' in the City limits. The first defendant left the city and opened a shop at Madurai. Subsequently, he returned to Madras and has opened a similar business in hardware materials at No. 15 Sembudoss St, under the name and style of 'saleh Machinery stores'. The second defendant is the firm which was started with the funds of the first defendant. The third defendant is the wife and the fourth defendant is the brother-in-law of the first defendant; they were merely benamidars and name-lenders for the first defendant. The first defendant is carrying on business and he should not be permitted to circumvent the clause in the partnership deed. On these allegations, the first plaintiff impleading his firm "m. M. Mohammed Saleh" as the second plaintiff, brought the suit for permanent injunction.

(2.) THE first defendant, in his written statement, contended that under the deed of partnership he was prohibited only from carrying on similar business under the name and style of 'm. M. Mohammed Saleh', that he has not committed any breach of the agreement, that the first defendant is not carrying on any business and that the agreement between the first defendant and the first plaintiff will not bind any one else. His further contention was that even otherwise the condition laid down is opposed to law and natural justice.

(3.) DEFENDANTS 2 to 4, in their written statement, contended that they were not aware of the business carried on by the first plaintiff and the first defendant. They denied the allegation that they are merely name-lenders. Their further contentions were that the business carried on by them is not similar to the firm of the first plaintiff, that they are entitled to carry on the business in any name or in any commodity or in any place and that the first plaintiff is not entitled to any relief and these defendants are entitled to compensatory costs.