LAILA Vs. KANTILAL LALCHAND SHAH

JUDGEMENT

(1.) This judgment disposes the above two suits. The parties in both the suits are the same. They are the heirs of the original plaintiff and defendant. The reference to the plaintiff and the defendant shall mean the original plaintiff and the original defendant. The original plaintiff and defendant and one Kanchanlal M. Shah were desirous of starting business in partnership firm in the name and style of Expert Metal and Enamel Works.

(2.) It is the case of the plaintiff that the said K. M. Shah purchased a undivided 1/3rd share in a piece and parcel of land then agricultural land situated at village Mohile-Kurla under a Conveyance Deed dated 12 th June, 1970. The said Shah declined to join the partnership business and as a result of the said Shah declining to join partnership, the plaintiff and defendant entered into an agreement under the Partnership Deed from 20 th April, 1970 on the terms and conditions set out in the agreement dated 23 rd July, 1970. The undivided 1/3rd share purchased by Shah which is said to belong to the plaintiff and defendant. The business of the firm was to manufacture of electrical, hospital wages, caution sign boards etc. and other enamel coated articles and metal fabrication. Clause 7 of the Partnership Deed provided that the plaintiff would contribute Rs. 80,000/- and the defendant Rs. 20,000/- as capital for the said partnership which would carry interest at the rate of 9% p. a. Under clause 9 of the Partnership Deed, the share of the plaintiffs and the defendants in the profits and losses were 60% and 40% respectively. Neither party was to separate from the firm, three months notice was required to be given after commencement of business by Conveyance Deed. The plaintiffs and defendants purchased the remaining 2/3 rd share in the plot of land. A shed was constructed on the plot for the purposes of the partnership business. Machinery was installed and that constituted the factory premises. Licenses were also obtained in or around June 1977. Disputes arose between the parties which were later resolved. The firm was dissolved on terms and conditions set out in agreement dated 28 th June, 1977 which provided that parties had dissolved firm with effect from 30 th June, 1977 and agreed for partition of the partnership assets and the debts and liabilities between themselves as mutually agreed. The agreement provided for the plaintiff to take over the assets, mainly goodwill, together with the firm name of Expert Metal and Enamel Works and all the outstanding amounts due to the partnership till dissolution as per books of account. The plaintiff would be liable to pay the debts due to the partnership business till date of dissolution in support of goods and raw material purchased for partnership business as per books of accounts including amounts payable to the Allahabad bank. The defendant was not take over exclusively open plot of land admeasuring 1800 sq. yards equivalent to 1504. 98 sq. metres being all liabilities for payment of all Hundis taken for the partnership purposes, assets of the said partnership were to be partitioned between the plaintiff and the original defendant.

(3.) Clause 4 provides for the stock-in-trade of the partnership to be divided in the share of 60:40 between the plaintiff and defendant. A telephone connection fell to the share of the plaintiff whereas a Viking tempo fell to the share of defendant. As far as plant and machinery were concerned, some machines shown in list "A" were taken over by the plaintiff exclusively and machinery in list "B" were taken over by the defendant exclusively. The factory premises, land and building admeasuring 6750. 8 sq. metres with mezzanine floor of 2000 sq. metres were to be divided equally between the plaintiff and the defendant. A license for the use of 65 H. P. was also to be split into 32 1/2 H. P. each to be allotted to each of the parties. 16 workmen were being taken over by the plaintiff and 10 by the defendant. Pending contracts of the partnership business would be taken over by the plaintiff. The dissolution and partnership which was to be executed and both parties are agreed to their costs.