SIDDAVARUPU RAMALINGA REDDY Vs. RACHAPUTI RAMALINGAM SETTY

JUDGEMENT

(1.) These appeals may conveniently be dealt with together, as was done in the Court below. In May, 1929, the appellant, who was the first defendant in both the suits, became a partner with the plaintiff in a mica mining business which the latter had been carrying on for some years. When the plaintiff started that business in 1924, he had two partners, namely, the second defendant, who was entitled to a four annas share and P.W. 3 who was entitled to a six annas share. The second defendant was only a working partner while plaintiff and P.W. 3 were the capitalist partners. Among the lands which they took on lease for the purpose of opening mica mines in connection with that business, was a block of land obtained under Ex. B for a term of five years from 7 October, 1925. On a portion of the land covered by this lease, they had opened a mine which they named The Nityakalyani Mine. For one reason or another, it was not possible for some years to work this mine to the best advantage, and, in December, 1928, P.W. 3 left the concern, assigning his six annas share (by Ex. D) to the plaintiff. The parties have put forward different versions as to the reasons that led to the plaintiff and the first defendant becoming partners in 1929. It is no doubt noteworthy that under this arrangement the first defendant agreed to advance the whole capital required for the working of the mine and to repay the moneys which the plaintiff has so far invested. But we agree with the lower Court that the arrangement was not the result of any financial difficulties of the plaintiff. This question does not however seem to us to be one of much importance, except as bearing upon a suggestion of the first defendant that he accepted such an onerous obligation only because it was represented to him at the time and he was led to expect that the lease under Ex. B would be renewed or extended and that the partnership, business would be continued even for a further term. When the first defendant became a partner, the second defendant sank into the position of a person remunerated by a share of the profits, it being expressly provided in Ex. M that he should not be liable for losses.

(2.) On 10 June, 1930, the plaintiff obtained (under Ex. E) a fresh lease of most of the lands covered by Ex. B, for a term of 10 years commencing from the date of the termination of the lease under Ex. B. One of the principal questions for decision in the appeals is whether the defendants are entitled to claim an interest in this new lease. In August and September, 1930, the position was left hazy, each party suspecting the other and neither of them taking up a definite position. Early in October, 1930, the plaintiff sent a notice (Ex. K) to the first defendant asserting that the new lease was his own and asking him to come and settle the accounts of the partnership which according to the plaintiff was terminating on 6th October, 1930, with the termination of the lease under Ex. B. By his reply (Ex. K- 2) the first defendant denied that the partnership was to come to an end on 6th October, 1930, and claimed that the lease under Ex. E should be treated as one acquired for the benefit of the partnership. As the plaintiff disputed this claim, the first defendant refused to agree to a settlement of the accounts of the partnership and on the night of 6 October, 1930, obstructed the plaintiff from working the mine by using the boiler which they had theretofore been using. The plaintiff sought the aid of the Magisterial authorities; but as they passed an emergent order restraining both parties from using the boiler or working the mine for a period of two months, the plaintiff instituted two suits on 24 November, 1930, O.S. No. 67 of 1930 (out of which A.S. No. 197 of 1935 arises) for the taking of the accounts of the partnership on the footing that it had come to an end by efflux of time on 6 October, 1930 and O.S. No. 68 of 1930 (out of which A.S. No. 310 of 1934 arises) for a declaration that the defendants were not entitled to claim any interest in the new lease-Ex. E and for an injunction restraining them from interfering with the plaintiff's working of the mine. He also claimed damages in respect of the loss sustained by reason of the 1 defendant's obstruction.

(3.) The 1 defendant denied that the partnership between him and the plaintiff had come to an end on 6-10-1930. He had however no objection to the Court declaring the partnership dissolved, if accounts were to be taken on the footing that the new lease also formed part of the assets of the partnership. He disputed the plaintiff's claim to damages and also contended that the amount claimed was excessive. The 2nd defendant had entered into a partnership arrangement with the plaintiff in respect of the new lease on 27 September, 1930 (Ex. J.) But, for some reason, he seems to have taken sides with the 1 defendant when the disputes between the plaintiff and the 1 defendant commenced. He accordingly filed written statements supporting the 1 defendant in his main contentions. The learned Subordinate Judge held that the partnership between the plaintiff and the defendants terminated by efflux of time on 6 October, 1930 and that the defendants were not entitled to the benefit of the new lease obtained by the plaintiff under Ex. E. He accordingly directed accounts to be taken in O.S. No. 67 of 1930 in the terms asked for by the plaintiff. In O.S. No. 68 of 1930 he gave the declaration and the injunction prayed for; he also directed the 1 defendant to pay damages to the plaintiff at the rate of Rs. 1,500 per mensem from 7th October, 1930 to 17 April, 1931, when the plaintiff was enabled to work the mine in consequence of his appointment as receiver. Against the decrees passed in the above terms, the 1 defendant has preferred these appeals.