PANNAJI DEVICHAND Vs. SENAJI KAPURCHAND

JUDGEMENT

(1.) This is an appeal from the decree of the First Class Subordinate Judge of Dharwar dismissing the plaintiffs suit in the following circumstances. The plaintiffs, purporting to be a firm, filed a suit against the defendants, three separate firms at Bellary, praying for a decree for Rs. 3,09,960-6-0 with interest from November 13, 1918, at the rate of six per cent. per annum till date of suit, against the defendants firm personally, and from their estates. They also prayed for future interest and costs.

(2.) The suit arose out of a certain transaction, which took place in October, 1918. It appears that about this time there was much activity in the Gadag yarn market. The agreements which are relevant to the appeal were three in number. The first was made on October 6, 1918, between some Marwadi firms and individuals, and the idea was to corner the market in what is called Count No. 20 of Gokak yarn. The corner failed to be secured and broke down.

(3.) This agreement was made between a firm named Pannaji Devichand and five other firms, or individuals. In the agreement, seven parties are mentioned, but one did not sign. Nine persons did sign and they represented six firms, more than one person having signed for a single firm in some cases. The result of this agreement was a kind of pool of yarn belonging to the parties to it in different quantities, and the arrangement was that the person to whom the yarn belonged should be given credit for it by the pool at Rs. 14 in the case of yarn for delivery on one settlement day, and at Rs. 14-4-0 for a second. This syndicate was called by the name of the principal firm, Pannaji Devichand & Co. The remaining two documents are Exhts. A and B in the case. Exhibit A is an agreement between the larger firm of Pannaji Devichand and three Bellary firms, and was come to on October 13, 1918. It is both a partnership agreement and a forward contract. The partnership is between the larger Pannaji Devichand firm, called the company by the learned Subordinate Judge, and the three Bellary firms, and its provisions are for the doing of yarn business and dealing in 2,000 bales of Gokak Mill yarn. The larger firm, it was arranged, was to have a four anna interest in the profit or loss, and the three Bellary firms were to have four annas, six annas and two annas respectively.