SHEONARAIN JAISWAL Vs. KRIPA SHANKAR JAISWAL

JUDGEMENT

(1.) At one time the plaintiffs and their father Ram Narain Jaiswal and the defendants and their father Rai Saheb Lakshmi Narain Jaiswal constituted one joint Mitakshara family which possessed considerable properties. On account of some differences, the two branches separated sometime in 19.53. Later on the adult members of the two families formed a partnership firm by a registered partnership-deed dated April, 1. 1954, under" the name and style 'M/s. Lakshmi Narain Ram Narain'. The plaintiffs 'branch owned four shares and the remaining six shares belonged to the defendants' branch. There is no dispute that the properties mentioned in the schedule to the plaint belonged to the aforesaid partnership firm. The firm mainly engaged itself only in manufacture and sale of spirits, country liquor and liquors of foreign brand. According to the case of the plaintiffs, the partners dissolved the firm sometime before April 16, 1970 and agreed to partition the assets of the firm in proportion to their share. So long as Rai Saheb Lakshmi Narain Jaiswal, father of the defendants, was alive, he was in sole charge of the firm and after his death the parties reposed confidence in defendant No. 1, who was made in charge of the management of the firm. Later on the plaintiffs found that defendant No. 1 betrayed the trust reposed in him and made all sorts of bunglings in running the business. He never rendered any accounts to the plaintiffs nor allowed them to inspect the business of the firm and although the business was in a very prosperous condition, they were never given any profits of the firm. On these grounds, there were differences which resulted in dissolution of the firm by mutual agreement of the parties, and, accordingly, a letter was written to the Commissioner of Excise, Bihar, Patna, dated April 16, 1970. to the effect that the firm was under the process of partition, but the defendants did not partition the assets of the firm and render accounts and allow the plaintiffs to look after the management of the business, rather all sorts of obstructions were put in their way. Though the partnership has been dissolved, yet the business is still running under the management of defendant No. 1. Hence, the plaintiffs filed Partition Suit No. 51 of 1970, in the Court of the Third Subordinate Judge, Gaya, on May 5, 1970. They also filed an application under Order 40, Rule 1 of the Code of Civil Procedure on May 7, 1970, for appointment of a receiver. The learned Subordinate Judge on this application appointed an ad interim receiver to take charge of the management of the suit properties and issued notice of show cause to the defendants.

(2.) The defendants against the order appointing an ad interim receiver came up to this Court. This Court by its order dated July 2, 1970 directed the court below to dispose of the receivership matter as soon as possible.

(3.) In response to the notice in the receivership matter, defendants Nos. 1, 3 and 6 appeared and showed cause wherein they denied the fact that defendant No. 1 was in sole charge of the business of the firm. According to them all the partners were looking after the business of the firm, and the plaintiffs had full opportunity to examine the accounts of the firm and they were duly paid their share in the profits of the firm. They also denied the allegation of the plaintiffs that the partnership was dissolved. If the plaintiffs did not like to remain as Partners of the firm, they were at liberty to take their due share and retire, but the partnership firm could not be dissolved in terms of Clause (15) of the deed of partnership. Therefore, the defendants contended that it was not a fit case for appointment of a receiver. In the alternative, they pleaded that the nature of the business of the firm was such that it was not possible for an outsider to act as a receiver to carry on the business of the firm and hence an outsider could not be appointed to act as a receiver of the firm.