KAMAKOTI AND KAMAKOTI Vs. BANK OF BARODA

JUDGEMENT

(1.) The suit has been laid for recovery of a sum of Rs.50,00,000.00 being the damages payable by the defendant to the plaintiff for the alleged wrongful dishonour of the cheque issued by the plaintiff.

(2.) The plaintiff is a sole proprietorship concern. The plaintiff commenced operations in the year 1992. The original business enterprise known as Kamakoti and Company was a partnership firm where the proprietor of the present plaintiff Mr.G.V.Ramakrishnan and his father were the partners. The said partnership firm was a member of the Madras Stock Exchange and was doing business as a stock broker from the year 1980. Subsequently, the present concern viz., Kamakoti and Kamakoti came into existence. It had developed its own distinct clientele and had a reputation of being a responsible and trustworthy stock broker in Chennai.

(3.) According to the plaintiff, the average turnover of the plaintiff is about Rs.30 Crores per annum. The plaintiff has been adopting a corporate style of functioning. During the year 1997, the plaintiff wanted to utilize the policy of bringing in a corporate entity as a member of the stock exchange and also for the purpose of saving capital gains tax on the sale or transfer of the membership ticket in the stock exchange by utilising the opportunity provided by the Income Tax Department, which had proposed a waiver of capital gains tax on conversion of sole proprietorship and partnership concerns which were carrying on business as stock brokers into corporate entities by inviting outside investments, the plaintiff had taken steps to garner outside investments so as to convert the plaintiff into a corporate entity.