BENARASIDAS KHANDELWAL Vs. ANGIRA DEBI

JUDGEMENT

(1.) This is an appeal from an order made on 20 July last by my learned brother Ameer Ali, J., restraining the appellants Benarasidas Khandelwal and another from further proceeding with suit No. 2075 of 1923. It appears that the appellants are persons who were doing certain business in partnership with one Raghumull Khandelwal and that Raghumull Khandelwal filed suit No 2075 of 1923 on 12 July 1923 against the appellants asking for partnership accounts. It does not appear that there were any partnership assets which required winding up, but the claim was that a large sum of money would be due to Raghumull from the appellants if the accounts of the partnership transaction were properly taken. Some short time afterwards the appellants began a cross suit against Raghumull Khandelwal at Delhi, but this suit was stayed. Raghumull died on 5 September 1926. I may say here that there is very little doubt that Raghumull died a rich man. He had a number of large assets, but he appointed some five persons to be executors of his will. There was one Gopal-das Modi; there was one Dinonath; there was Hansraj, his son-in-law, being the husband of his daughter Sm. Angira Debi; the widow had power to nominate an executor and she nominated herself; so that, at any rate, there were five executors to administer the estate.

(2.) In the partnership suit with which we are concerned the executors were substituted for the deceased plaintiff in October 1926 and the suit came on for hearing as long ago as 28th March 1930 when, by an order of Buckland, J., all disputes including the question of costs were referred to the arbitration of Sir N.N. Sircar and two Attorneys. Sir N.N. Sircar was to be the umpire and, to begin with, he was to decide the terms of the partnership business and all the transactions entered into so that a preliminary decree for accounts might be properly framed, and if there was any difference in the accounts to be taken under the preliminary decree between the Attorneys acting as arbitrators, then also he was to act as umpire. First of all, with regard to the preliminary decree there was an award by Sir N.N. Sircar on 29 May 1930 which on 12 June 1930 was confirmed by the Court which made a preliminary decree in accordance therewith. So this partnership suit had proceeded to a decree for partnership account. Thereafter the arbitrators proceeded with the reference as to accounts. They differed on certain points; the matter was referred to the umpire and the umpire made a second award on 8 December 1930. That award was challenged by litigation on the part of the executors up till March 1931 unsuccessfully. In January 1931 there was a decree passed on the second award. In January 1932 the arbitrators disposed of all the questions remaining on the accounts except one, namely, what should be the basis of interest and the period for which interest was to be allowed.

(3.) I understand that to mean whether the partners who had moneys belonging to the partnership in their hands in the course of the business were to be charged with interest or not. On that point the arbitrators could not agree and they referred it to the decision of the umpire but I am satisfied from their award that upon the decision of that matter a statement of account could be finally got out without difficulty. The arbitrators made their award stating the single matter which was to go to the umpire. In the meantime since September 1926 much had been happening to the estate of Raghumull, the deceased. Exactly how badly it was managed we do not at the moment know. There is no evidence before us that it will be insolvent in the sense that the creditors of this rich man will be unable to be paid; but the executors having fought considerably among themselves for a long time one is naturally inclined to think that in the end the estate will be insolvent. In any case on 2 February, 1932 a charge of mismanagement by one executor against another was sufficiently serious to result in a decree for administration against the estate. It was made in a suit brought by the executor Gopaldas Modi on 29 July 1929 and soon afterwards on 10 February 1932 judgment in accordance with the award of 29 January was passed in the partnership suit. It seems that the result of the decisions of the umpire and of the arbitrators has been adverse to Raghumull Khandelwal the original plaintiff, and his estate; and it was getting manifest that his partners, the defendants, namely the appellants before us, were going to get the better of the partnership account.