SMT DROPADI Vs. BANKEY LAL

JUDGEMENT

(1.) This is a plaintiff's appeal. The suit as originally framed asked for the following reliefs: (a) The partnership of the firm known as Lallu Mal Hardeo Das Cotton Spinning Mills, Hathras, may be dissolved and the accounts may be taken from the defendant's manager from the beginning of the partnership and whatever amount may be found due to the plaintiff the same may be awarded to her and inasmuch as the correct sum due to the plaintiff cannot be fixed just now without the rendition of account, the valuation of the suit is fixed at Rs. 5100 and the court-fee has been paid thereon. If according to the accounts the sum due to the plaintiff be found in excess of the said sum, in that case a decree may be passed in favour of the plaintiff for the sum so found due on taking additional court-fee and necessary directions for the dissolution of partnership may be issued and after appointing receiver all the proceedings may be taken in connexion with the dissolution of the partnership.

(2.) At a subsequent stage, the plaintiff applied for the amendment of the plaint by the addition of what now appears as relief (b) which is as follows: (b) If the Court holds the partnership between the parties to have been dissolved, defendant 1 be ordered to render the accounts of the partnership from 1921 up to this day to the plaintiff and a decree for the amount and property which may be found as belonging to the plaintiff on account of her share may be passed in her favour--laid at Rs. 5100 as an alternative relief.

(3.) Her application was granted and that relief was added. The Court below has dismissed the suit. The suit relates to a firm styled Lalla Mal Hardeo Das Cotton Spinning Mills Co. Hathras, which has its head quarters at Hathras. It appears that a partnership was entered into some time in the year 1920 and business was started. Subsequently it was considered desirable to reduce the terms of the contract of the partnership to writing and a deed was executed on 4 April 1923. This document is Ex. A-1 on the record. We shall presently have occasion to refer to some of the relevant provisions of this deed. The reasons for seeking the dissolution of this firm are given by the plaintiff in Paras. 10 and 11 of the plaint, the main plea being that defendant 1, Bankey Lal, who is the manager of the firm, does not manage the business in a manner which may be profitable to the partners and does not maintain proper accounts. The plaintiff impleaded 24 persons as defendants to the suit. Of these 24 defendants, seven, namely, defendants 1, 3, 4, 5, 9, 14 and 16, filed written statements contesting the suit, while live, namely defendants 6, 7, 8, 11 and 18, filed written statements in effect supporting the plaintiff. Various pleas were taken in defence by the defendants who opposed the plaintiff's claim and a number of issues were framed. The main ground on which the Court below has dismissed the suit is that the plaintiff has not got a right to sue for dissolution which is the only ground with which we are concerned in this appeal. The deed Ex. A-1 after reciting the history of the business lays down a number of terms by which the executants agreed to be bound. The following paragraphs are important and we consider it necessary to quote them in extenso. 16. No partner or his heir or representative shall have power to sell his share or to withdraw from the partnership in any way other than that mentioned below. 17. It shall be the duty of the partner, desiring to withdraw himself from the partnership of the factory, to sell his share in the manner given below. In case the company is not in a position to purchase the said share or to have it sold in any way, the partner desiring separation shall have power to have the partnership dissolved and thus withdraw himself from the partnership. 18. The partner desiring to transfer his share shall have to give a registered notice to the company allowing three months time, so that it may either purchase his share itself at the price fixed by it according to para. 28 or may get the same sold in any other way. On receipt of the notice an emergent meeting of the company will be held within 30 days in which it will be decided whether the company is ready to purchase the share or not. If it is decided by opinion of the majority that the company should purchase the share, it shall purchase it itself, otherwise it shall allow those partners to purchase it who might be willing to do so, at the price mentioned above. If no partner is ready to purchase the said share, the company shall get it sold in any way it thinks proper. If the company fails to have it sold within three months, the partner seeking separation or the partner making the sale shall have power to transfer his share to anyone. 19. If any partner, contrary to the conditions of this agreement, shall transfer his share to any person who is a partner or stranger the company and its partners shall have the right of pre-emption and the price fixed according to para. 28 of this agreement shall be paid. 20. Any of the partners willing to purchase the share of another partner shall be in duty bound to attend the general or emergent meeting of the partners to be held according to the conditions mentioned above and show his readiness for the purchase in the meeting. If the intention of purchase is not expressed (by any partner) in the meeting, he shall have no right of purchase as against the other partners. In case there are more than one partner willing to make the purchase, the said share be transferred to them in proportion to the shares held by them in the company. 21. The partnership shall not be dissolved on account of the death of any person. On the ground of insolvency, insanity, etc., of any person, no partner shall have power to have the partnership dissolved through Court. 22. The partners shall not be authorized to remove any one from partnership, but if the partnership of any partner is found prejudicial to the company's rights or if there is loss or apprehension of any loss to the company by his remaining a partner, the partners shall be authorised to remove him from partnership by holding an ordinary or emergent meeting, but the defaulting partner shall be given full opportunity to set up a defence in the meeting. In case of separation of his share, his money, according to the fixed rate in para. 28 shall be paid to him after which he shall cease to have any right.