MADHO PRASAD Vs. GOURI DUTT GENESH LAL

JUDGEMENT

(1.) This is an appeal by defendants 3 to 7 against the judgment and decree of the learned Subordinate Judge of Chaibassa dated 29 July 1933, by which he decreed the suit of the plaintiffs which was brought to recover a sum of Rupees 65,756-3-0 as the amount due to them from the appellants as well as from other defendants (who have not appealed). The plaintiffs are a firm carrying on money- lending business at Jugselai in this province and at Kharagpur in the neighbouring province and in other places. Defendant 1 with his son defendant 2 constitute a joint Hindu family. Defendant 3, along with his sons defendants 4 to 7, also constitute among themselves a joint Hindu family. The appellant Ram Sagar (defendant 6) is married to the daughter of defendant 1. (His Lordship then stated the circumstances which led to the institution of this suit and proceeded.) In the result I reject the contention of the learned Counsel that this appellant never made the acknowledgment on 19 March 1928 by which he accepted the liability for Rs. 47,637-3-3. I now proceed to consider whether it has been established to our satisfaction that defendant 3 was a partner of Bholanath from 1923 as alleged by the plaintiffs or from some later date in April 1926, as is the case of the defendants and in particular whether he undertook the liability for Rs. 47,637-3-3 on 19 March 1928 in his capacity as a partner for the partnership dues which were binding upon him.

(2.) It was strenuously contended on behalf of the respondent that the documentary evidence upon the record of this case leaves no manner of doubt that the appellant was a partner with Bholanath in Jharbera and other concerns from the beginning of 1923 and in particular it was pointed out that the appellant himself had admitted in his evidence and in the written statement that he was a partner with Bholanath from April 1926. Reliance was placed upon the statement in para. 10 of the written statement of the appellant and in particular upon his cross-examination at page 49 at line 4 where the appellant stated: For Jharbera my advances were not as loans but were for carrying on work--Canposh work went on in name of Bhola for a few months in 1026 and so in 1927. In 1928, Bhola did work Shere as his own exclusively in his khas name. For karbar in his name in 1926 and 1927 I was a partner. I can t Bay if he worked in 1925. I made advances these years 1926-27 as partner for carrying on work.... I have khatas and bills showing my disbursements on Jharbera; they will show the date on which I became partner.

(3.) By the consent of the parties, the issue which was raised on this topic was Issue 5 which distinctly admitted that defendant 3 was a partner from April 1926; otherwise I do not see why the issue was framed as "Was defendants a partner before April 1926." Mr. Mahabir Prasad relying upon the case in Bhaggu Lal V/s. De Gruyther (1881) 4 All. 74 contended that a man may erroneously think that he is a partner and even state he is a partner but such statements are not enough and that the test in every case is whether the person has acquired the rights of a partner or is a mere creditor. He argued that it was true that the appellant was anxious to be called a partner although in this case all the facts and circumstances pointed to the conclusion that his client was no more than a creditor however erroneously he thought himself to be a partner and however foolishly he prevailed upon the plaintiffs to put in his name as a partner in the books of the account by which he acknowledged the debts of Bhola as partnership debts. His further argument was based upon the fact that there could be no partnership in law because the terms of the lease, granted by the Gangpur Estate to Bholanath and B.K. Sanyal, themselves admittedly contained an express stipulation that no partner could be introduced without the sanction of the estate and the previous sanction of the Bihar Government; in other words the argument of the learned Counsel was that the appellant was neither in law nor in fact at any material time a partner with Bholanath however erroneously he believed it himself or represented to others by his assertion that he was a partner and that all that the evidence conclusively established was that Madho was really given 9 annas share in the profits and 9 per cent, interest on his advances in the capacity of a creditor. Before dealing with the facts which are established to our satisfaction in this case it is desirable to state that the law upon this point is very clear.