JAINARAIN RAM LUNDIA Vs. SURAJMULL SAGARMULL

JUDGEMENT

(1.) THIS appeal is directed against an appellate judgment of the Calcutta High Court, dated June 18, 1946, affirming with slight variation, the decision of a single Judge of the Original Side of that Court, dated August 14, 1944. The suit, out of which this appeal arises, was one for specific performance of a contract for sale of certain shares in a private limited company, together with fractional interest in a partnership business, and it was commenced by two plaintiffs, who are respondents Nos. 1 and 2 in this appeal, against four defendants, two of whom, viz. , defendants Nos. '5 and 4, figure as appellants before us. Of the other two defendants, defendant No.2 is not a party to this appeal at all, inasmuch as the suit against him was withdrawn and dismissed in the trial Court and his name was struck off from the list of defendants altogether. As regards defendant No.1, though he was retained as a party, the plaintiff's gave up their claim against him before the hearing of the suit was concluded in the trial Court; and he has been made only a pro forma respondent in this appeal. The controversy in this Court, therefore, lies entirely between the two plaintiffs on the one hand and defendants Nos. 3 and 4 on the other, and to appreciate the contentions that had been raised on behalf of the appellants, a short resume of the material facts would be necessary.

(2.) ON February 29, 1936, a partnership firm, known as Marwari Brothers, was brought into existence on the basis of a partnership agreement, executed on thai-date by and between a number of parties. The parties were (1) Lakshmi Devi Sugar Mills, (of which Kedar Nath Khaitan, plaintiff No.2 was the Managing Agent), (2) Kedar Nath Khaitan, (3) Bholi Ram, (4) Gobordhan Das and his brother Badri Prosad, (5) Jainarain Ham Lundia and (6) Biseswar Nath. Under the terms of the partnership deed, the first, second, third and fifth parties had each a three annas' share in the business, while the fourth and the sixth parties were each of them given a two annas' share. The main object of the partnership was to promote a private limited company for the purpose of erecting and working a sugar mill in the district of Champaran in Bihar and securing for the firm the managing agency of the mill. By a supplementary deed executed on December 1, 1936, certain modifications were introduced into the original terms, and it was provided inter alia that the partnership would be for a period of 90 years, and that in case of death of any of the partners, his heir or heirs would automatically step into his place and be taken as partners without effecting dissolution of the partnership.

(3.) THE plaint was filed on August 18, 1941, and the two plaintiffs averred that they were ready and willing to perform their part of the agreement and claimed specific performance of the contract for sale of 350 shares in Ganga Devi Sugar Mills and seven annas' share in Marwari Brothers as against the four defendants, to wit, Gobordhan Das, Badri Prosad, Jainarain and Madanlal, all of whom it was alleged, were bound by the agreement entered into on January 1, 1941. THEre was an alternative claim for damages, in case no decree for specific performance was given.