PENTAPATI VENKATARAMANA Vs. PENTAPATI VARAHALU

JUDGEMENT

(1.) This appeal arises out of a suit for the taking of the accounts of certain dissolved partnerships. The parties belong to the Vysia community and are members of one family though belonging to different branches which had become divided many years ago. Defendants 1, 2 and 3 are the oldest members in the group and they are the sons of one Chinna Venkanna. Defendants 4 to 23 are the descendants of defendants 1 to 3. Chinna Venkanna had a second cousin Venkanna who had two sons Appayya and Venkanna. The plaintiff and defendants 24 and 25 are the sons of Appayya. Defendant 28 is a grandson of Venkanna, the brother of Appayya. Defendants 26, 27 and 29 are respectively the sons of defendants 24, 25 and 28. These families had admittedly been carrying on trade in Vizianagaram; for the purposes of the present suit, it is necessary to deal with three businesses which are referred to in the record as Kottu No. 1, Kottu No. 2 and Kottu No. 3. Kottu Nos. 1 and 3 seem to have been carried on in the market and Kottu No. 2 in the house. Kottu Nos. 2 and 3 were carried on in the name of defendant 1 while Kottu No. 1 was carried on in the name of defendant 2. It is admitted that in Kottu No. 1 defendants 1, 2 and 3 had an 8 annas share as representing their family, defendants 24 and 25 had a 4 annas share as representing their joint family including the plaintiff, and defendant 28 had the remaining 4-annas share. It is also admitted that in Kottu No. 2, the family of defendants 1 to 3 had a 12-annas share, the family of defendants 24 and 25 had a 3-annas share and defendant 28 had a 1-anna share. As regards Kottu No. 3, plaintiff and defendants 24 and 25 contend that their branch was entitled to a 3- annas share in this also as in Kottu No. 2; but defendants 1 to 23 maintain that this kottu was their exclusive concern and that the branch of plaintiff and defendants 24 and 25 or the branch of defendant 28 had no interest in it.

(2.) It is common ground that in the course of 1926, the parties deemed it best to dissolve the partnership in respect of Kottu No. 2 and that they agreed to its dissolution as from 28 June 1926 (see Ex. 10); but as the books of the business were at that time in the possession of the income-tax authorities, the settlement of accounts was postponed. It is also not disputed that on 2 July, 1927 the document (Ex. 4) was executed by defendants 1 to 3, 24, 25 and 28 purporting to be a settlement of accounts relating to Kottu No. 2. Kottu No. 1 was agreed to be dissolved as from 20 June 1927 and on 2 July, 1927 the arrangement evidenced by Ex. 5 was entered into in respect of this kottu. Lastly, it is admitted that there was no settlement of accounts in respect of Kottu No. 3 nor any attempt made to settle its accounts whatever the reason might be. The evidence makes it clear that though defendants 24, 25 and 28 signed Exs. 4 and 5, they did not receive the moneys payable to them in pursuance thereof and that they were not prepared to abide by them; but, instead of directly impeaching them, they put forward the plaintiff, who was a minor at the time, to send the notice (Ex. 39) dated 17 August 1927, which does not in terms refer to the settlements under Exs. 4 and 5 and attack them but merely suggests that defendants 1 to 3 had been putting off coming to a settlement and concocting false accounts in the meanwhile. Ex. 39 attempted to make out that not merely Kottu Nos. 1 to 3 but certain other businesses also including in particular a concern referred to as Ramalingeswaraswami Oil Press were the joint family concerns of the parties. This was replied to by Ex. 85 which denied the existence of any joint family business as alleged in Ex. 39 and admitting the existence of a partnership, so far as defendants 24, 25 and 28 were concerned, in Kottu Nos. 1 and 2, pleaded that the accounts of these concerns had been settled and that the amount payable to these three defendants as per those settlements had been deposited with one Dhara Veerabhadraswami (D.W. 8 in the case). About this item, attempts were made to ascertain whether defendants 24, 25 and 28 were prepared to draw the money which was said to have been deposited with D.W. 8, and as they were not willing to do so, D.W. 8 purported to report that fact to defendant 1 and to return theamount to him. The present suit was instituted on 7 January 1928 by the plaintiff who is the younger brother of defendants 24 and 25 and who happened to be a minor even on the date of the suit.

(3.) The plaint alleged that the businesses above referred to as Kottu Nos. 1, 2 and 3 were family businesses, that in Kottu No. 1 the plaintiff's branch was entitled to a four annas share and that in Kottu Nos. 2 and 3 that branch was entitled to a three annas share and that defendant 1 as the eldest member of the family had been managing the three kottus and was in possession of all the accounts, cash balances and other assets relating to them. As regards the Ramalingeswaraswami Oil Press, the plaint mentioned that it was worked with capital borrowed from the assets of Kottus Nos. 1 and 2; the plaint accordingly claimed that in respect of Kottus Nos. 1 to 3, the plaintiff's branch was entitled to its share of the assets on the taking of accounts and that in respect of the oil press, it was entitled to a corresponding share in the interest payable on the capital borrowed therefor from Kottus Nos. 1 and 2. In paras. 5 to 8 of the plaint, reference was made to the settlement of accounts evidenced by Exs. 4 and 5 and various allegations were made against them. In para. 9 it was stated that defendants 1 to 3 had not paid even the amount admitted by them to be due to the plaintiff's branch. In the result the plaint prayed for the taking of the accounts of the three kottus and payment to the plaintiff's branch of a large sum of money which it was suggested would be due to that branch as representing its share, A decree was asked for in favour of the plaintiff or in favour of the plaintiff and defendants 24 to 27. Defendants 24 to 27 supported the plaintiff and it is stated by the learned Subordinate Judge that the suit was in fact conducted before him by defendants 24 and 28 on behalf of the plaintiff. Defendants 28 and 29 supported the plaintiff except for one point of difference, namely that in the 28th defendant's written statement Kottu No. 3 was stated to be an exclusive concern of defendants 1 to 23 and only interest was claimed in respect of advances taken for its working from Kottus Nos. 1 and 2. The contesting defendants were defendants 1 to 23. They objected to the maintainability of the suit as brought. They contended that the settlements evidenced by Ex. 4 and 5 were in the nature of awards and were binding till set aside. They also contended that the settlements were fair and reasonable and binding upon the plaintiff. On these contentions various issues were raised of which it is sufficient to refer at this stage to issues 3, 4, 5, 9 and 11. The issues relating to the existence of a joint family business and those arising out of the contention that there was an award rest upon a misapprehension and need not be noticed. There was nothing like a formal reference and an award and there was no question of a joint family business as between all the parties but only of business carried on in partnership by certain persons who were members of certain joint families.