1. In the above Notice of Motion, the plaintiffs have moved this Court for ad interim reliefs. However, the defendants have raised the contention that this Court has no jurisdiction to entertain the suit since the Partnership Firm i.e Laxmi Developers is not registered under the provisions of the Indian Partnership Act, 1932 (“the Act”). In view thereof, by consent of the parties, the following issue is framed as a preliminary issue and decided hereunder: “Whether in view of non-registration of the Partnership Firm Laxmi Developers, the present suit is barred under section 69 of the Indian Partnership Act, 1932”.

2. According to the plaintiffs, a Partnership Deed was executed on 11th August, 1986, between the plaintiffs and defendant Nos. 1 to 3. By the said Partnership Deed, the Partnership Firm was constituted under the name and style of “Laxmi Developers” for conducting the business of investment in properties, development of the same and also for sale of shops, flats, commercial premises and to acquire open spaces for development.

3. According to the plaintiffs, after the constitution of the said Partnership Firm, an application for registration in the prescribed Form A was filed on 16th September, 1986, before the Registrar of Firms. The said application was signed by all the Partners including defendant Nos. 1 to 3. The said application was numbered as AR/26115.D/2/86 by the Registrar of Partnership Firms. In the said application form, the name of plaintiff No. 7, who was a minor at that time, was mentioned in Column “D” instead of Column “G”. Therefore, the Registrar of Partnership Firms issued a notice dated 1st January, 1986 addressed to Arvind Raman and Company, Chartered Accountants of the said Laxmi Developers to the effect that in the application form dated 16th September, 1986, there is an objection which is required to be removed. A reminder was also sent on 11th December, 1989. The plaintiffs have produced the Income Tax Returns of Laxmi Developers for the Accounting Years 1987–1988 and 1988–1989, which were filed on 11th August, 1986 and also a declaration dated 31st August, 1989 under section 184(7) filed with the Income Tax Department for continuation of its registration. The said declaration is also signed by defendant Nos. 1 to 3 herein. In the Income Tax Returns, the Balance-sheet of the Partnership Firm is also filed for the years 1987–1988 and 1988–1989. The plaintiffs have also produced a certificate dated 9th June, 2012 issued by Vijay M. Dhanak, Partner of M/s Arvind Raman and Company, Chartered Accountants of the said Partnership Firm Laxmi Developers to the effect that the Partnership Deed dated 11th August, 1986 was signed by all the Partners including defendant Nos. 1 to 3 in his presence and the said Chartered Accountant Firm has also applied for registration of the Partnership Firm, and has received a Permanent Account Number for the said Partnership Firm.

4. According to the plaintiffs, after the constitution of the said Partnership Firm Laxmi Developers, the said Partnership Firm, under an Agreement of Sale dated 31st August, 1986, purchased property bearing Survey No. 61, Hissa No. 11, corresponding to CTS No. 443, admeasuring about 1072.40 sq. mtrs. situated at Taluka Borivali, Mumbai Suburban District (hereinafter referred to as “the suit property”) from Manilal L. Vora, Navinchandra L. Vora and others for a total consideration of Rs. 4 lakhs. Pursuant to the said Agreement of Sale, the Vendors therein handed over and delivered peaceful possession of the suit property to the Partnership Firm and as such the said Partnership Firm i.e Laxmi Developers acquired the right, title and possession of the suit property.

5. According to the plaintiffs, though the said Partnership Firm had purchased the suit property for redevelopment and construction of new buildings, due to certain technical problems, including the fact that the suit property was a landlocked plot and therefore unless Laxmi Developers obtained an access and approach road from the adjoining plot of land, it was not possible to develop the suit property. Thus the suit property remained as it is.

6. As set out in the plaint, the defendant No. 1 by misrepresenting that he is the owner of the suit property executed a Joint Venture Agreement dated 1st July, 2005 in favour of defendant No. 4 which later stood terminated and a fresh Joint Venture Agreement dated 29th November, 2011 was executed by defendant No. 1 in favour of defendant No. 5.

7. According to the plaintiffs, the Partnership Deed between the plaintiffs and defendant Nos. 1 to 3 is duly notarized but not registered. At no point of time was the Partnership Firm dissolved nor was the Partnership Deed cancelled either by the plaintiffs or by defendant Nos. 1 to 3. As such, the Partnership Firm continues to be the owner of the suit property.

8. Upon coming to know of the aforesaid facts, the plaintiffs through their Advocate issued a notice dated 19th April, 2012 to the defendants inter alia recording that the Joint Venture Agreements dated 1st July, 2005 and 29th November, 2011 executed by defendant No. 1 in favour of defendant Nos. 4 and 5 on the basis of false statements and representations are not legal and valid documents and not binding upon the plaintiffs and their Partnership Firm Laxmi Developers. Shri R.R Nagda, Advocate for the defendants, vide his letter dated 9th May, 2012 replied to the plaintiffs' Advocate's notice dated 19th April, 2012 wherein he inter alia recorded as follows:

“4 my client states that no partnership Firm in the name and style of M/s Laxmi Developers had ever existed legally inter alia because neither such Firm in which your client purportedly claims partnership and my client was registered under the Indian Partnership Act nor it is registered under the provisions of the Income Tax Act nor any business much less in respect of plot of land bearing C.T.S No. 443, Borivli has ever been conducted in such name nor any returns have ever been filed under the said Income Tax Act nor any other business activity whatsoever has ever been carried on in the name or style of such so - called “Laxmi Developers” during last about 25 years all which are true facts to the knowledge of your said clients. Your clients have also suppressed from you a further true fact to the effect that they have executed an agreement long back inter alia recording the abovementioned facts disentitling them from the alleged claims, as falsely narrated in your said letter under reply.”

9. The Advocate for the plaintiffs vide his letter dated 28th May, 2012 denied and disputed the contentions raised by the defendants through their Advocate's letter dated 9th May, 2012, and inter alia recorded as under:

“3. My client states that merely because the said partnership is not registered under the Partnership Act, does not mean that the said partnership never existed. Whereas in fact, in joint venture agreement dated 1st July, 2005 with Kamla Sons it is in terms recited that the property in question is purchased by the said partnership Firm namely Laxmi Developers of which my clients and your client are the partners. In the said agreement it is further recited that my client Valjibhai and Satishbhai has relinquished their right, title and interest in the said partnership Firm and in the property in question which is purchased by Agreement of sale dated 31st August, 1986 by the said partnership Firm Laxmi Developers. These two recitals of your own agreement falsify the claim of your client that your client is the sole proprietor and owner of the property in question.”

The Advocate for the plaintiffs therefore by his aforesaid response reiterated and confirmed that any agreement executed by defendant No. 1 in respect of the suit property, in favour of defendant Nos. 4 and 5, is illegal and not binding upon the plaintiffs. According to the plaintiffs, the stand taken by the defendants is patently false and contrary to the record. The plaintiffs have submitted that the aforesaid application form for registration of the Partnership Firm was forwarded to the Registrar of Partnership Firms and the notice issued to the Firm by the Registrar belies the claim of defendant Nos. 1 to 3 that the Partnership Firm never existed. The plaintiffs have also pointed out that the stand taken by the Advocate for defendant Nos. 1 to 3 in response to the notice dated 19th April 2012 viz. that the said Partnership Firm is not registered under the Income Tax Act and has not filed any returns is also false. It is submitted that defendant No. 1 has admitted his signature on Form-A and the declaration filed before the Income Tax Authorities under section 184(7) of the Income Tax Act, but has wrongly alleged that the signatures of defendant Nos. 2 and 3 are fabricated.

10. The plaintiffs have thereafter filed the above suit and moved for urgent reliefs.

11. Clauses (1) and (2) of section 69 of the Act are relevant for deciding the preliminary issue and are reproduced hereunder:

“69. Effect of non-registration— (1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.

(2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm.”

12. The Learned Advocates for the defendants have submitted that prayer clauses (b), (c) and (d) of the Plaint are hit by section 69(2) of the Act. The learned Advocate appearing for defendant No. 5 has submitted that the plaintiffs' entitlement to the above mentioned prayer clauses (b), (c) and (d) arise out of a contract i.e Agreement dated 31st August, 1986, under which it is alleged that the Firm agreed to acquire the rights in the suit property. In view of section 69(2) of the Act, there is a bar on institution of a suit by or on behalf of the Firm against any third party unless the Firm is registered and the persons suing have been shown as Partners in the said Firm, in the Register of Firms. The definition of third party given in section 2(d) of the Act reads as follows:

“2(d) “third party” used in relation to a firm or to a partner therein means any person who is not a partner in the firm; and”

It is therefore submitted on behalf of defendant No. 5, that the said defendant No. 5 falls within the definition of a third party and the suit is filed to enforce a right arising from a contract and as such the same is barred under section 69(2) of the Act. The learned Advocate for defendant No. 5 has further submitted that in the judgments relied upon by the plaintiffs, it has been held that the suit to enforce statutory rights and the rights at Common Law are not barred. The said cases pertain to the vested rights of persons claiming such rights, and were not solely based on a contract. Therefore, the ratio laid down in the decisions relied upon by the plaintiffs lends no assistance to the plaintiffs.

13. The learned Senior Advocate appearing for the plaintiffs has submitted that the provisions of section 69 of the Act are not attracted and do not apply to this suit at all.

14. Prayer clause (a) of the plaint reads thus:

“(a) That this Hon'ble Court may be pleased to declare that the Partnership Deed dated 11th August, 1986 executed between the plaintiffs and the defendants Nos. 1 to 3 is legal, valid and subsisting and binding upon the Partners of the said Partnership Deed.”

The learned Senior Advocate appearing for the plaintiff has submitted that the relief in terms of prayer clause (a) of the Plaint is not a relief for enforcement of any contract. Relying on the decision of the Hon'ble Supreme Court in Mukund Balkrishna Kulkami v. Kulkami Powder Metallurgical Industries, (2004) 13 SCC 750 it is submitted that prayer clause (a) of the Plaint is maintainable and not hit by the bar of section 69 of the Act.

15. Prayer clause (a) of the Plaint is set out hereinabove, and it can be seen therefrom that by the said prayer the plaintiffs have sought a declaration that the Partnership Firm of Laxmi Developers has come into existence and does exist and that the plaintiffs and defendant Nos. 1 to 3 are Partners thereof. The said prayer clause (a) therefore is not a relief for enforcement of any contract. The plaintiffs have correctly gained support from the decision of the Hon'ble Supreme Court in Mukund Balkrishna Kulkami v. Kulkami Powder Metallurgical Industries (supra). The facts of that case are similar to the facts in the present case. In that case the relief sought in the suit was for a declaration that the defendant No. 1 therein was a partnership business in which the appellant and the respondent No. 2 had equal shares. The suit also prayed for dissolution of the firm and for accounts and payments. The respondents therein contended that there was no partnership as claimed by the appellant; that the respondent No. 1 was a sole Proprietor of respondent No. 2 and, further, since the partnership had not been registered, the Suit was barred under section 69 of the Act. The trial Court and the First Appellate Court answered the issue in favour of the plaintiffs and the appellant. However, the High Court in further Appeal held that the suit was not maintainable under section 69 of the Act. On this question, the Supreme Court reversed the decision of High Court and held that the suit was maintainable and not hit by the bar of section 69 of the Act. Paragraphs 8 and 9 of the said decision are relevant and reproduced hereunder:

“8. As far as the third question is concerned, that, no doubt, is a question of law. But the conclusion arrived at by the High Court is fallacious. Section 69(1) of the 1932 Act reads:

…… …… ……

9. The sub-section contains embargos which must coexist before a plaintiff can be non-suited under that sub-section. The two embargos relevant for this case are : (1) that the suit should be filed by person “suing as a partner in a firm” and (2) that the suit must be to enforce a right arising from a contract. The submission of the respondents which was accepted by the High Court was that the prayer of the appellant, namely, for a declaration of the existence of the partnership and the share between the parties was a suit to enforce a right under a contract against the firm. A prayer for such declaration could not be said to be made by person suing as a partner. It was a prayer to be a partner and is therefore not debarred under the provisions of section 69(1). Furthermore, what was in fact being prayed for by the appellant was a declaration of the existence of a contract between the parties. That could not be said to be a suit to enforce a right arising from a contract. The second prayer of the appellant was not to continue as a partner of the firm but to dissolve the firm. To that extent the appellant was suing “as a partner”. This he was entitled to do under section 69(3)(a) which insofar as it is relevant, reads as follows:

“69 (3) The provisions of sub-sections (1)… shall not affect — (a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm.”

The question of section 69(3) of the Act is not relevant to the case at hand because that provision deals with a right to sue for dissolution of a firm which question does not arise for consideration in the present case.

16. I am therefore of the view that in the instant suit prayer (a) of the Plaint is maintainable and not hit by the bar of section 69 of the Act.

17. Prayer clause (b) of the Plaint reads thus:

(b) That this Hon'ble Court may be pleased to declare that the said Agreement dated 31st August, 1986 in respect of the suit property is legal, valid and subsisting and binding upon the defendants and that pursuant to the said Agreement of Sale dated 31st August, 1986, the suit property vest and belong to the said Partnership Firm i.e Laxmi Developers.

18. The learned Senior Advocate appearing for the plaintiffs has submitted that in the said prayer, the plaintiffs do not seek to enforce any right in any contract through the institution of the present suit. The declaration is only in respect of a right and title already acquired by the Partnership Firm. The reference to the Agreement dated 31st August, 1986 is only a historical fact to show that the Partnership Firm has acquired rights in the suit property. It is submitted that a contract can be enforced only against the counter party to the contract. The counter party to the Agreement dated 31st August, 1986 are the original vendors viz. Manilal Vora, Navinchandra Vora and Valji Shamji Chheda in their capacity as Vendors under the said Agreement with the Partnership Firm. Manilal Vora and Navinchandra Vora are not parties to the present suit. Valji Shamji Chheda is a party to the suit in his capacity as a Partner of the Partnership Firm Laxmi Developers and has not been joined in the suit in his capacity as a co-vendor under the said Agreement. In support of the above contentions, the Learned Senior Advocate appearing for the plaintiffs has relied on the decision of Raptakos Brett and Co. Ltd. v. Ganesh Property, (1998) 7 SCC 184 : AIR 1998 SC 3085. He has also relied on the judgment dated 23rd July, 2009 of the Division Bench of this Court in Appeal (L) No. 53 of 2009 in Notice of Motion No. 2012 of 2007 in Suit No. 1453 of 2007, (Kuljindersingh Ahluwalia v. Smt. Sandeep Kaur Ahluwalia, 2009 (10) LJ Soft 26), wherein the Hon'ble Division Bench has relied on the decision of the Hon'ble Supreme Court in Raptakos Brett and Co. Ltd. (supra) and held that section 69 must be strictly construed and the bar of section 69 cannot be applied on inferences. The Hon'ble Division Bench in its said judgment further quoted from a decision of the Hon'ble Supreme Court in Haldiram Bhujiawala v. Anandkumar Deepakkumar, (2000) 3 SCC 250, that a suit by an unregistered firm is not affected by nor hit by the provisions of section 69(2) of the Act, if a statutory right or even a common law right was being enforced by the suit. The Division Bench in paragraphs 17 to 19 of its judgment held that the suit in question there, claiming that the shares of defendant No. 4 company was the property of the partnership firm (which is similar to prayer (b) of the suit at hand) was not based on any contract, and the suit was maintainable and not hit by section 69 of the Act. In paragraph 24, the Division Bench has held that in any event a part of the cause of action and reliefs claimed in the plaint were in any case beyond the scope of section 69 of the Act. The learned Senior Advocate appearing for the plaintiff further submitted that the judgment of the Supreme Court in Raptakos Brett and Co. Ltd. (supra) categorically holds that where a suit is based upon two causes of action or a composite cause of action, even if one cause of action may be barred by section 69, but the other cause of action is not barred, the suit is still maintainable. It is therefore submitted that assuming whilst denying that prayer clause (b) is hit by section 69 of the Act, the suit would still be maintainable so far as prayer clauses (a) and (c) and all other reliefs consequential to those prayers are concerned.

19. I have considered the submissions advanced on behalf of the plaintiffs as regards prayer clause (b) of the Plaint. From the said prayer clause (b), which is reproduced hereinabove, it is clear that the declaration sought by the plaintiffs is that the Agreement dated 31st August, 1986 (whereby the Partnership Firm purchased the suit property) is legal, valid and binding on the defendants and the rights in the suit property subsists in and belong to the Partnership Firm. The plaintiffs are therefore correct in their submission that prayer (b) is sought for a declaration of the title of the Partnership Firm in respect of the suit property and does not seek to enforce any right in any contract by way of the present suit. The declaration is only in respect of a right and title already acquired by the Partnership Firm. The reference to the Agreement dated 31st August, 1986, is only by way of a historical fact to show how the Partnership Firm acquired rights in the suit property. If the suit would have been for enforcement of the contract, the original vendors of the suit property would have been joined as party defendants to the suit. However, the instant suit proceeds on the basis that the property has already been acquired by and vests in the Partnership Firm. Prayer clause (b) is therefore based upon a Common Law right already acquired and held by the Partnership Firm on the basis that it already has and holds the title to the suit property. I am fortified in my view by the decision of the Division Bench of this Court in an unreported judgment dated 23rd July, 2009 in Kuljindersingh Ahluwalia v. Smt. Sandeep Kaur Ahluwalia (supra) which draws support from the decision of the Hon'ble Supreme Court in Haldiram Bhujiawala v. Anandkumar Deepakkumar (supra).

20. As set out hereinabove, the learned Advocate appearing for defendant No. 5 has submitted that according to the definition of “third party” in section 2 (p) of the Act, any person who is not a Partner in the firm should be treated as a “third party”. He submitted that defendant No. 5 falls within the definition of third party and the suit is filed to enforce a right arising from a contract, and as such the same is barred under section 69(2) of the Act. The Hon'ble Supreme Court in its decision in Haldiram Bhujiawala (supra) has in detail analysed as to what the Legislature meant when it used the words “arising from a contract” in section 69(2) of the Act. Paragraphs 21, 22 and 23 of the said decision read thus:

“21. The above Report and provisions of the English Acts, in our view, make it clear that the purpose behind section 69(2) was to impose a disability on the unregistered firm or its partners to enforce rights arising out of contracts entered into by the plaintiff firm with third party - defendant in the course of the firm's business transactions.

22. In Raptokos Brett and Co., (1998) 7 SCC 184 it was clarified that the contractual rights which are sought to be enforced by the plaintiff firm and which are barred under section 69(2) are “rights arising out of the contract” and that it must be a contract entered into by the firm with the third party defendants. Majumdar, J. stated (at p. 191) as follows:

“A mere look at the aforesaid provision shows that the suit filed by an unregistered firm against a third party for enforcement of any right arising from a contract with such a party would be barred.”

From the above passage it is firstly clear that contract must be a contract by the plaintiff firm and not with anybody else but with the third party defendant.

23. The further and additional but equally important aspect which has to be made clear is that, the contract by the unregistered firm referred to in section 69(2) must not only be one entered into by the firm with the third party-defendant but must also be one entered into by the plaintiff firm in the course of the business dealings of the plaintiffs firm with such third party-defendant.”

In the instant case the plaintiffs or the Partnership Firm have admittedly not entered into any contract with the defendant Nos. 4 and/or 5 (third parties). The contract is entered into by defendant No. 1 only with defendant Nos. 4 and 5 pertaining to the property which according to the plaintiffs is the Partnership Property, and defendant No. 1, in his individual capacity had no right to enter into any contract qua the same with any person/party including the defendant Nos. 4 and/or 5. Therefore, in my view, the submission advanced on behalf of defendant No. 5 cannot be accepted. Therefore, in my view, it cannot be said that prayer clause (b) is hit by section 69 of the Act.

21. Prayer clause (c) of the Plaint reads thus:

“(c) That this Hon'ble Court may be pleased to declare that the Joint Venture Agreements dated 1st July, 2005 at Exhibit “C” hereto and Joint Venture Agreement dated 29th November, 2011, at Exhibit “D” hereto are illegal, null and void and not binding upon the plaintiffs”.

The learned Senior Advocate appearing for the plaintiffs has submitted that prayer clause (c) of the plaint seeks a declaration that the Joint Venture Agreements annexed at Exhibits-C and D to the Plaint are null and void and not binding upon the plaintiffs. The said Agreements have been entered into by defendant No. 1 in his purported capacity as the sole owner of the suit property. Exhibit-D has been entered into by defendant No. 1 with defendant No. 5. Defendant No. 5 is not a Partner of the Firm. The Partnership Firm or any of the Partners are not parties thereto. Therefore, by prayer clause (c), the plaintiffs do not seek to enforce any right arising out of the contract of the Joint Venture Agreement. The relief in prayer clause (c) is also based on the subsisting and already vested title to the suit property in the Partnership Firm and this relief arises out of a common law right of a owner of a property against a third party/interloper who seeks to set up a claim adverse to the owner of the property. Relying on the Judgments already dealt with hereinabove, it is submitted that even prayer clause (c) is not hit by section 69 of the Act.

22. As can be seen from prayer clause (c) of the Plaint, the plaintiffs seek a declaration that the Joint Venture Agreements at Exhibits-C and D to the Plaint are null and void and not binding upon the plaintiffs. These Agreements have been entered into by defendant No. 1 in his purported capacity as the sole owner of the suit property. The Agreement at Exhibit-D has been entered into by defendant No. 1 with defendant No. 5. The Partnership Firm or any of the Partners are not parties thereto. By the said prayer clause (c), the plaintiffs do not seek to enforce any rights arising out of the contract of Joint Venture Agreements. There is no question of the plaintiffs enforcing any right under the Joint Venture Agreements because the plaintiffs are not parties thereto and are in fact disputing the Joint Venture Agreements and seeking to have them declared null and void and not binding on the plaintiffs. The relief in prayer clause (c) of the Plaint is therefore also based upon the subsisting and already vested title to the suit property in the Partnership Firm and this relief arises out of a common law right of an owner of a property against a third party/interloper who seeks to set up a claim adverse to the owner of the property. Therefore, in my view, prayer clause (c) is also not hit by section 69 of the Act.

23. Prayer clause (d) is for injunction by way of a consequential prayer in the plaint and prayer clauses (e) to (k) are all interim prayers arising out of the substantive prayers (a) to (d) of the Plaint. I am therefore satisfied that the reliefs sought in prayer clauses (a) to (d) of the Plaint are outside the ambit of section 69 of the Act and I answer the above issue in the negative.

24. The learned Advocates appearing for the parties on 8th October, 2012 made their aforestated submissions on the above preliminary issue framed by the Court and also submitted that though they started with an application seeking ad interim reliefs, they would have no objection if the submissions on the Notice of Motion are heard finally on the basis of denials. In view thereof, the Notice of Motion was also finally heard with the consent of the parties.

25. The learned Senior Advocate appearing for the plaintiffs submitted that in view of the facts set out in paragraphs 3 to 9 above, the plaintiffs are entitled to an order and injunction restraining the defendants from selling, alienating, encumbering, parting with possession and carrying on construction and/or creating any third party rights in respect of the suit property.

26. The learned Senior Advocate appearing for defendant Nos. 1 to 3 submitted that the Partnership Firm of “so-called Laxmi Developers” of which the plaintiffs claim to be Partners does not exist at all during the last about 25 years and the signatures of plaintiff Nos. 2 and 3 and those of defendant Nos. 2 and 3 as they appear on Exhibits A, H and I are false and/or forged. The so-called Firm has never carried on any business nor have the plaintiffs invested any amount in the suit property nor have they taken any interest whatsoever in the affairs concerning the suit property. It is submitted that the so-called Firm has never been registered under the Income Tax Act nor any Income Tax Returns under the Income Tax have ever been filed by or on behalf of the so-called Firm and that the Proprietory Concern of defendant No. 1, M/s Laxmi Corporation, has been exclusively and single handedly looking after various affairs in respect of the development of the suit property and related matters during the past about 17 years, and has continuously incurred various expenses for acquiring 5 adjoining properties and for evicting hutments etc. on all the six properties. It is submitted that after going through Exhibit-A of the Plaint, defendant No. 1 recollected that at the material time in the year 1986, the plaintiff Nos. 1 and 4 and defendant No. 1, “had initially, just tentatively, desired to form a partnership of M/s Laxmi Developers, I had in good faith put my signatures at the very first instance on several papers which now appear on page Nos. 39, 123 and 124 of the plaint, when no one else had put their signatures thereon”. It is submitted on behalf of defendant No. 1 that without admitting that the document at Exhibit-A was indeed signed by all the persons named therein, the said document has not been acted upon for the last about 25 years. It is further submitted that plaintiff No. 4 had, some time in 1993–94 borrowed a personal loan from one Jayantilal D. Shah to the extent of Rs. 17 lakhs but he could not repay the same and therefore he signed a purported allotment letter for an area of 1156 sq. ft. in favour of the said Mr. Shah by adjusting the said loan amount. Thereafter when plaintiff No. 4 was disinterested in the said project, he settled his investment in the project by requesting defendant No. 1 to give allotment of flats to the said Mr. Shah by adjusting the said amount of Rs. 17 lakhs as receipt of part purchase price towards the said allotment. Thus plaintiff No. 4 settled his account and defendant No. 1 allotted an area of 1400 sq. ft. in favour of the son and the wife of the said Mr. Shah. It is submitted that similarly in January, 1995, plaintiff No. 1 also arrived at a settlement with defendant No. 1 wherein defendant No. 1 agreed to allot to him an area of 600 sq. ft. in the project. In support of his contention, defendant No. 1 has relied on a MoU dated 1st January, 1995. It is therefore submitted on behalf of defendant No. 1 that no case is made out for interim reliefs by the plaintiffs and that no reliefs can be granted to the plaintiffs also due to the delay and laches on their part.

27. The learned Advocate appearing for defendant No. 5 has submitted that the alleged Deed of Partnership was allegedly signed in the year 1986. Even the signature of some of the Partners is disputed. There is nothing on record to show that the said Partnership Deed was ever acted upon or that any business was conducted by the said Partnership Firm. Since the suit property has now become developable, the plaintiffs who had abandoned their so-called right, have started laying claim to the same with mala fide intent and ulterior motives. However, there is gross delay and laches on the part of the plaintiffs and in the meantime the defendant No. 5 who is a third party has acted to his own prejudice by entering into a Joint Venture Agreements. It is further submitted that the plaintiffs have suppressed material documents from this Court. The plaintiff No. 4, in lieu of the consideration received by him, has given up his rights in the suit firm in the year 1993–94. Further, the plaintiffs had arrived at a settlement with the defendant No. 1 and entered into a Memorandum of Understanding dated 1st January, 1995. It is submitted that defendant No. 1 himself has been filing returns in respect of the business as a Proprietory Concern. It is submitted that defendant No. 5 has only entered into a Joint Venture Development Agreement on the basis of the document which clearly shows that the plaintiffs have no right in respect of the suit property and as such the Notice of Motion be dismissed.

28. The learned Senior Advocate appearing for the plaintiffs has denied and disputed the aforestated allegations made by the defendants. He has submitted that the MoU pertains to a different property. He has submitted that plaintiff No. 4 has not even signed the said MoU. He has submitted that the plaintiffs have not given up any of their rights in the Partnership Firm and/or the property of the Partnership Firm. He has submitted that the Partnership Firm has ten partners and by no stretch of imagination the defendant No. 1 can contend that he has become the sole Proprietor of the Partnership Firm. He has submitted that all the contentions on behalf of the plaintiffs and defendant No. 5 fall in view of the title certificate issued by Advocate R.R Nagda dated 6th August, 2009 wherein he has categorically certified that M/s Laxmi Developers, a Partnership Firm, has furnished to him various records such as agreement, Power of Attorney, property card etc. in relation to the suit property and has certified that in view of the documents referred to by him in the Certificate and the information received by him, he is of the opinion that the title of the said M/s Laxmi Developer in respect of the suit property (captioned property) are clear and marketable and free from reasonable doubts and encumbrances.

29. The learned Senior Advocate appearing for the plaintiffs has further submitted that the said title certificate was issued by Advocate R.R Nagda for the purpose of obtaining an IOD from the Mumbai Municipal Corporation to commence construction work on the suit property. He has submitted that apart from the fact that in the Agreement between defendant No. 1 and defendant No. 5 dated 29th November, 2011, it is categorically mentioned that an agreement dated 31st August, 1986 was entered into between the Original Vendors and M/s Laxmi Developers in respect of the suit property. It is also specified that the Municipal Corporation of Greater Mumbai has issued an I.O.D, bearing No. CHE/A4780.BP(WS)AR dated 26th August, 2010 approving plans for development of the suit property. It therefore cannot be contended by defendant No. 5 that he has not seen the IOD documents before entering into the Joint Venture Agreements. It is obvious that along with the IOD documents, defendant No. 5 could not have missed the title certificate issued by Advocate Nagda on 6th August, 2009 stating that the property is owned by the Partnership Firm i.e Laxmi Developers. It is therefore submitted by the learned Senior Advocate for the plaintiffs, that the plaintiffs are entitled to interim reliefs as prayed.

30. I have considered the submissions advanced on behalf of the parties. The plaintiffs have annexed a Deed of Partnership dated 11th August, 1986 as Exhibit-A to the Plaint. The said Deed shows that defendant No. 1 has only 9 per cent share in the profits/losses of the Partnership Firm. The said Partnership Deed is signed by the plaintiffs and defendant Nos. 1, 2 and 3. The plaintiffs have also annexed to the Plaint, copy of the application forwarded to the Registrar of Firms in the prescribed Form A. The said application was numbered as AR/26115.D/2/86 by the Registrar of Partnership Firms. In the said application form, the name of plaintiff No. 7 who was a minor at that time was mentioned in column “D” instead of column “G” of the said printed form A. Therefore, the Registrar of Partnership Firms issued a notice dated 1st January, 1986 addressed to Arvind Raman and Company, Chartered Accountants of the Partnership Firm Laxmi Developers, pointing out the said objection. A certificate is also issued by Mr. V.M Dhanak, Chartered Accountant, certifying that the Partnership Deed dated 11th August, 1986 of M/s Laxmi Developers was signed by all the Partners i.e 7 plaintiffs (including the minor), and defendant Nos. 1 to 3 in his presence. The plaintiffs have also produced the Income Tax Returns of the Partnership Firm for the Accounting Years 1987–88 and 1988–89, which were filed on 11th August, 1986 and also declaration dated 31st August, 1989, under section 184(7) filed with the Income Tax Department for continuation of its registration. The said declaration is also signed by defendant Nos. 1 to 3. In the Income Tax Returns, the balance-sheet of the Partnership Firm is also filed for the years 1987–88 and 1988–1989. The suit property is purchased by the Partnership Firm-Laxmi Developers under an agreement for sale dated 31st August, 1986. The Agreement for Sale is signed by the plaintiff No. 4 on behalf of the Firm.

31. From the aforesaid it is clear that the defendant No. 1 has made incorrect statements in his reply dated 9th May, 2012 in response to the notice dated 19th April, 2012 by the Advocate for the plaintiffs that “no partnership firm in the name and style of M/s Laxmi Developers had ever existed legally inter alia because neither such firm in which your client purportedly claims partnership with my client was registered nor it is registered under the provisions of the Income Tax Act nor any returns have ever been filed under the said Income Tax Act…. during the last about 25 years….”. It is stated only in the affidavit-in-reply filed by the defendants in the Notice of Motion, that he now recollects having signed the documents which were later forwarded to the Registrar of Firms and Income Tax authorities. However, he has alleged that he had signed the said documents in blank and that defendant Nos. 2 and 3 as well as plaintiff Nos. 2 and 3 had not signed the documents, and that their signatures are fabricated and forged. Apart from the fact that plaintiff Nos. 2 and 3 have submitted that their signatures are neither fabricated nor forged, an independent professional i.e the Chartered Accountant of the Partnership Firm has certified that all the plaintiffs as well as defendant Nos. 1, 2 and 3 had signed the Partnership Deed in his presence. For these reasons, I do not see why he should be disbelieved until the defendants through evidence prove otherwise. I am therefore satisfied that there exists a Partnership between the plaintiff and defendant Nos. 1, 2 and 3 since 11th August, 1986. The Firm is not dissolved till date. It appears that since the plot of land purchased by the Partnership Firm for the purpose of development was landlocked, therefore the Partners did not take any steps to develop the same for a very long time. However it in no way entitles the defendant No. 1 to claim sole ownership of the said plot. If the defendant No. 1 has spent any amounts on the said plot as alleged, he will have to produce the accounts for the said expenses incurred by him to the Firm, and claim the same, but he certainly cannot claim sole ownership of the Partnership Property on the ground that the other Partners have in several years not taken interest in the Partnership Property and/or have allowed him to spend on the said Partnership Property.

32. As regards the allegation advanced on behalf of defendant Nos. 1 to 3 to the effect that plaintiff Nos. 1 and 4 have given up their right in the said property, firstly I find that in the reply letter of the Advocate for defendant Nos. 1 to 3 dated 9th May, 2012 he has not made any such allegation but has only stated that, “your clients have also suppressed from you a further true fact to the effect that they have executed an agreement long back inter alia recording the aforementioned facts disentitling them from the alleged claims, as falsely narrated in your letter under reply”. It is clarified in paragraph 1 of the said letter that “your clients” includes all the seven plaintiffs. However, it is pertinent to note that the alleged agreement allegedly signed by all the plaintiffs regarding the alleged facts, disentitling them from their alleged claims, is even at this stage not produced before this Court. Instead, a MoU is sought to be produced before the Court which is only signed by plaintiff No. 1 and where the description of the property is different. Some other documents which did not find any mention in the reply letter dated 9th May, 2012, by the defendants Advocate, are relied upon to show that certain amounts were paid by defendant No. 1 to defendant No. 4, for which defendant No. 4 signed letters stating that he has settled his investment in the project and requesting defendant No. 1 to give allotment of flats to Mr. Shah. Even assuming that one or two of the plaintiffs have created certain rights in favour of defendant No. 1, defendant No. 1 cannot contend that the suit property has ceased to be the property of the Partnership Firm in which there are 10 Partners including the seven plaintiffs. The learned Advocate appearing for defendant Nos. 1 to 3 has on a specific query raised by the Court, admitted that Mr. Nagda has issued a detailed title certificate dated 6th August, 2009 wherein Mr. Nagda has inter alia certified as follows:

“1. My client M/s Laxmi Developers, a partnership firm having its office at shop No. 2 Sminu Building, near Prem Nagar, S.V Patel Road, Borivli West, Mumbai-400092, has furnished to me various records such as agreement, power of attorneys, property card etc. in relation to the captioned property. My said client has requested me to certify the titles on the basis of the said records and information given by it.

4. By an agreement dated 31-8-1986 executed between the said Original Purchasers of One Part and M/s Laxmi Developers of the Other Part, the Original Purchasers agreed to grant development rights in respect of the said plot of land to the said M/s Laxmi Developers at or for the price and consideration and on the terms and conditions therein set out.

5. By Power of Attorney executed by the said (1) Manilal Lakhamsay Vora and (2) Navinchandra Lakhamsey Vora on or about 14-9-1989 in favour of the said Valji Shamji Chheda, the latter i.e Valji Shamji Chheda acquired all the rights, powers and authorities in respect of the said plot of land.

6. Finally, the said M/s Laxmi Developers paid entire price to the said original purchasers and procured an irrevocable Power of Attorney to sell and convey the said plot of land and thereupon the said Power of Attorney and Deed of confirmation dated 16-4-2009 came to be registered with Sub-Registrar of Assurances,-Borivli 6 on 28-5-2009 vide Serial No. 4273 of 2009.

8. In view of the above documents and information, I am of the opinion that titles of the said M/s Laxmi Developers in respect of the captioned property are clear and marketable and free from reasonable doubts and encumbrances.”

Even today, Mr. Nagda is representing defendant Nos. 1 to 3 before this Court. However, neither Mr. Nagda nor the learned Senior Counsel appearing for defendant Nos. 1 to 3 is in a position to explain as to why the title certificate issued on 6th August, 2009 certifies that the suit property belongs to the Partnership Firm of M/s Laxmi Developers. Therefore in any event, the said title certificate dated 6th August, 2009 admittedly issued by Shri Nagda representing defendant Nos. 1 to 3, belies the entire case advanced by defendant Nos. 1 to 3 viz. that the suit property has ceased to be the property of the Partnership Firm since 1995 and that defendant No. 1 is the sole owner of the suit property since 1995, and is therefore entitled to deal with the same. In view thereof, the question of the plaintiffs being disentitled to any relief on the ground of delay and laches and/or suppression also does not arise.

33. I also do not agree with the submission advanced on behalf of defendant No. 5 that defendant No. 5 has entered into a Joint Venture Agreement dated 29th November, 2011 without notice. The document dated 29th November, 2011 entered into between defendant No. 1 and defendant No. 5 itself mentions that the suit property belonged to the Partnership Firm i.e Laxmi Developers. In the said agreement it is also recorded that an agreement dated 31st August, 1986 was entered into between the Original Vendors and M/s Laxmi Developers in respect of the suit land. It is also specified that the Municipal Corporation of Greater Mumbai has issued I.O.D, bearing No. CHE/A4780.BP(WS)AR dated 26th August, 2010 approving plans for development of the suit property. It therefore cannot be contended by defendant No. 5 that he has not seen the IOD documents before entering into the Joint Venture Agreement. I am therefore not willing to accept at this prima facie stage, that defendant No. 5 has entered into Joint Venture Agreement without notice.

34. In the circumstances, in my view the plaintiffs have made out a prima facie case for grant of interim relief in their favour. The balance of convenience is also in favour of the plaintiffs and against the defendants. In view thereof, pending the hearing and final disposal of the suit, the defendants are directed to maintain status quo as of date in regard to the suit property. The Notice of Motion is accordingly disposed of. However, the hearing of the Suit is expedited. The defendants are directed to file their respective written statements within a period of four weeks from today. Place the Suit for framing of issues on 3rd December, 2012.

Order accordingly.