KHODAY GANGADARA SAH Vs. ASWAMINADHA MUDALI

JUDGEMENT

(1.) The only point that arises for determination in this suit is quite simple and though not frequently arising is of considerable importance. The plaintiff's suit is for the taking of the accounts of a partnership between himself and the three defendants. That a partnership agreement was made between these parties it is not disputed. The terms of the partnership have been reduced to writing and are to be found in the admitted copy filed as Ex. A. Defendants 2 and 3 have not contested the claim of the plaintiff and are apparently themselves anxious that the accounts of the partnership should be taken and the profits or losses ascertained and distributed

(2.) The contest in the ease which raises the only point for determination has been put up only by the 1 defendant and has reference merely to the validity of the contract sought to be enforced. The point as put by the learned Counsel for the 1st defendant is this : the partnership contract was made in the Mysore State within the territories of His Highness the Maharaja and had reference to a business in arrack carried on by the plaintiff under a license obtained by him from the Mysore Government. Under the terms of the license granted to the plaintiff he was not entitled, without the previous permission of the Deputy Commissioner, to do what he purported to do, namely, take into his business as partners the Defendants 1, 2 and 3. No such permission was obtained by the plaintiff and, therefore, his act of entering into the partnership agreement was an act forbidden by the law and, therefore, void and, therefore, unenforcible. If this contention should be upheld, it follows that the plaintiff's suit must fail. And on the other hand, if this contention should fail, the plaintiff would be entitled to a preliminary decree for the taking of the accounts of the partnership and the matter will have to be referred to the Official Referee far the taking of the usual accounts.

(3.) To begin with, I regret to state that neither the learned Counsel for the 1st defendant nor the learned vakil for the plaintiff seemed to have paid any consideration to an important aspect in this case, namely, that whereas the contract was made and was apparently intended to be performed entirely within the Mysore State, this suit has been instituted in this Court. And in fact both sides argued the case before me as if there were no such complication and it was a simple ease of the contract being or not being illegal according to the law of the Mysore State. The law of that State, however, it was recognized had as being the law of a Foreign State to be proved as a matter of fact by the expert witness, an advocate at Bangalore, who has been called for the purpose. The question, therefore, has not been properly argued before me on the footing of a contract sought to be enforced in a British Court, but made and intended to be performed in a Foreign State and that a Protected State under the protection of the British Government and subject to its suzerainty. The 1 question that has to be determined in such cases is: What is the law applicable to the particular contract in question ? that is to say, by the application of which law should it be determined whether the contract in question is void for illegality as urged. Fortunately there is no serious difficulty in this case with regard to the law applicable, because whether we take the law applicable generally in the first instance as the law which the parties intended that the contract should be governed by or as the law of the place where the contract was made or as the law of the place where the contract was intended to be performed, it is in every ease the same law, the law of the Mysore State. No evidence has been adduced before me and no argument addressed to show that the intention of the parties was that the contract should be governed by any law other than the law of the Mysore State. We may also pre some that as the contract was apparently intended to be performed in its entirety within the Mysore State the parties intended that the contract should be governed by the law of that very State. This being settled, the questions that next arise for consideration are : (a) whether according to the law of the Mysore State this contract of partnership was forbidden : (b) whether if so forbidden, the provision of law forbidding was only a fiscal or taxing enactment or a provision of law based on the public policy of only a particular State or whether the prohibition is founded on natural justice or some moral principle which, if it is not, ought to be, recognized in international jurisprudence.