KHADERAN RAM Vs. SHARDA PRASAD

JUDGEMENT

(1.) THIS revision is directed against the judgment and order dt. 17-9-1984, passed by Sri M. R. Siddiqui, Civil Judge Gyanpur, district Varanasi, whereby he has rejected an application for appointment of the Receiver in Misc. Case No. 26 of 1984. THIS application was moved by Khaderan Ram and others, the present revisionists, and was contested by Sharda Prasad and others, the opposite parties. It may be mentioned here that Khaderan Ram and others approached the court with an application under S.20. Arbitration Act, and during the pendency of this application an application for appointment of a receiver purporting to be under O.40, R.1. C.P.C., read with S.41 and Schedule 2, Arbitration Act and S.151, C.P.C., was moved. It was this application which on the contest put forward by the opposite parties was rejected by the learned Civil Judge. The allegations in the petition for appointment of the receiver were that Mashal Talkies, situate in Bhadohi. district Varanasi, was a partnership firm in which the share of the defendants was 42% and that of the opposite parties was 58%. On 26-3-81 Khaderan Ram by a telegraphic notice dissolved this firm since it was a partnership at will. Even after that the opposite parties are running the Cinema. It was also mentioned that one of the original partners Kamta Prasad died in 1975 and the other partner died in 1983 and on Kamta Prasad's death on 21-1-1975 the firm was reconstituted. In the beginning the licence of running the cinema was in the names of Kamta Prasad and Kalka Prasad. When Kamta Prasad died, the licence was got renewed in the names of Lalta Prasad and Kalka Prasad and this continued up to 1979. The dispute started arising during the year 1979-80 when Lalta Prasad wrote to the Licensing Authority to include the name of his brother Sharda Prasad also in the licence. It was opposed. There was an amicable settlement as a result of which the names of Khaderan Ram and Kalka Prasad on one side and Lalta Prasad and Sharda Prasad on the other were included in the renewed licence. After the so-called dissolution of the firm on 26-3-1981, the opposite parties applied for the issue of the licence in the names of Lalta Prasad and Sharda Prasad for the year 1981-82. Objections were filed by the present revisionists but these were rejected and the licence was issued in the names of Lalta Prasad and Sharda Prasad. A writ petition was filed, but it was dismissed on 26-2-83 as infructuous. Then in the year 1982-83 fresh renewal of the licence was sought in the names of Lalta Prasad and Sharda Prasad and the objections that were filed by the revisionists were rejected on the ground that it was a case of renewal of the old licence and not a case of issue of a fresh licence. Another Writ Petition No. 5394 of 1982 has been filed, which is still pending. Then these proceedings under S.20, Arbitration Act, were started on 9-3-84. It is contended that the Cinema is being run and the revisionists have been excluded from its management they are not being paid any share of the profits, the accounts are being manipulated, all the assets of the Cinema are being secretly dealt with and in order to save the misappropriation, alienation, waste and damage, it is just and convenient that a receiver may be appointed. Objections have been filed by the opposite parties. Their contention is that there has been no dissolution of the partnership firm. Partly because a telegraphic notice cannot take the place of a legal notice and also because there has been no service of this notice on all the partners. They also contend that before July, 1977 the firm was being run under the management of the revisionists and the result was that it was running in heavy losses and water tax and charges of electricity dues had all fallen in arrears. Since July 1977, on account of this state of affairs the revisionist withdrew from the management and it was taken over by the opposite parties and the situation is that all past dues have been paid off. The profits have been increased and there is general improvement in the business of the firm. Shares of the revisionists in respect of the profits are being credited to their account. All along the revisionists have been taking the steps, vide letter D/-9-5-1980 and other documents on the record, to see that the business is completely stopped. When they failed in their efforts, they filed writ petitions and have now taken (Sic) receiver. There is no proof of any misappropriation. Allegations are all vague. It is wrong to say that they have been excluded. Actually they have withdrawn from the management. There is no case of waste or mismanagement and hence the application for receivership is not maintainable.

(2.) IT must be made very clear at the outset that an application under S. 20, Arbitration Act, and application for appointment of the receiver, which purports to be under O. 40, R.1, C.P.C., and S. 41 read with Schedule 2, Arbitration Act, are two different proceedings. One is not affected by the other.

(3.) IN this case the question for determination will be whether by the making of the application under S. 20, Arbitration Act, the partnership can be deemed to have been dissolved.