Mani Bhooshan Datta Ray v. Amulya Chandra Deb Ray

This is an appeal from a decision of the Additional District Judge of Mymensingh, dated April 30, 1934, whereby he reversed a decision of the Subordinate Judge of the Second Court, Mymensingh, dated May 4, 1933. The suit had been brought by the plaintiff, Amulya Chandra Deb Ray, against the defendant, Mani Bhooshan Datta Ray, and certain other persons for dissolution of a partnership, or rather, on the basis that the partnership which had existed between the plaintiff and the principal defendant had been dissolved on Baisâkh 15, 1335 B.S, corresponding to April 28, 1928. The defendant on his part alleged that the partnership in question had been dissolved in the month of Aghrahâyan, 1334 B.S, which corresponds to December, 1927. The precise date of the dissolution of the partnership was of prime importance, because one issue in the suit was whether or not the suit was barred by limitation. The Court of first instance did not accept the allegation of the plaintiff. It came to the conclusion that the partnership had been dissolved on Baisâkh 6, 1335, and that, accordingly, the suit was barred by limitation. Against that decision the plaintiff appealed and on appeal the learned District Judge of Mymensingh came to the conclusion that none of the three dates above mentioned was the correct date and that in fact the partnership was not dissolved up to the time of the institution of the suit. He summarised his opinion thus:—

It would follow therefore that there was no dissolution of the partnership either in the month of Agrahâyan, 1334, as alleged by the defendant No. 1 or on Baisâkh 15, 1335, as alleged by the plaintiff. As I have shown above, there was also no dissolution of the partnership by mutual agreement in the month of Phâlgun or Chaitra, 1334, nor any such dissolution on Baisâkh 5 or 6, 1335, as found by the learned Subordinate Judge without any evidence to support his finding. Consequently, it must be held that there has been no dissolution of the partnership in the eye of law by mutual agreement and the parties must be relegated to their original position, or, in other words, it must be found as a fact that there has been no dissolution of the partnership at any time.

It appears, however, from a perusal of the plaint that the plaintiff had taken the precaution of adding an alternative prayer and he claimed in the alternative that dissolution should be decreed by the Court itself and that then all necessary and proper accounts should be taken between the parties.

It is a fundamental principle in a matter of this kind that, where accounts are claimed as between partners there must of necessity as a condition precedent be a claim for the dissolution of the contractual relationship between the two or more I persons who constitute the partnership in question. The learned District Judge, being of opinion that there was no dissolution of the partnership prior to the institution of the suit, stated his views thus:—

I find that the partnership had not been dissolved at any time before the institution of the suit and the plaintiff is entitled to the relief claimed in the alternative and as the period of limitation for a suit for dissolution of partnership and accounts is six years the suit is clearly within time and not barred by limitation.

The learned District Judge, accordingly, ordered that the appeal be allowed with costs against the first defendant and the judgment and decree of the Court of first instance were set aside.

Mr. Sen, appearing on behalf of the appellant before us, has argued that the learned District Judge was not entitled to make a decree for dissolution of partnership, because it appears that he did not consider any of the grounds for dissolution which would bring the matter within the four corners of the provisions of s. 254 of the Indian Contract Act. It is to be observed in passing that, having regard to the manner in which the suit out of which this appeal arises was instituted, the matter falls to be governed by the provisions of the Indian Contract Act and not by any of the corresponding provisions of the present Partnership Act. Section 254 lays down certain grounds on which the Court may dissolve a partnership. It is a fact that the lower appellate Court has not indicated that it purported to act on any of the grounds enumerated in s. 254. But it is conceded by the appellant that, in this case, the partnership was one where there was 1 no definite contract between the parties and no time limit for the duration of the partnership was ever agreed upon. It was, therefore, a partnership at will and as such was liable to be terminated at any time at the will of either partner. It will be seen, therefore, that apart from the necessity of invoking judicial authority to compel the taking of accounts there would have been no necessity for recourse to a Court of law at all. The plaintiff could at any time have intimated his intention to retire from the partnership and so bring the relationship of the partners to an end. That being the position, we are of the opinion that this is a case which falls within the principles indicated by Lord Phillimore in the Privy Council, when sitting with Lord Darling, Mr. Ameer Ali and Sir Lancelot Sanderson in the case of Sathappa Chetti v. S.N Subramanian Chetty. The relevant passage is at page 859 of the report where His Lordship said:—

In the view of the Subordinate Judge this partnership had been dissolved considerably more than three years before the date of the institution of the present suit. In their Lordships' view this was not so; in their view there never had been any dissolution until the plaintiff, by the present suit, by his writ and plaint claiming dissolution, intimated his will to dissolve, which of itself is enough to put an end to a partnership at will.

It seems to me that on the facts and circumstances of this case the matter does not come within the purview of s. 254 at all, but is governed by and is to be determined in the light of the provisions of ss. 252 and 253 of the Indian Contract Act. For here there was a partnership at will and the plaintiff was entitled at any time to intimate his desire to put an end to the partnership and he could so intimate that desire by bringing a suit against, his partner. Though the learned District Judge has not stated the matter exactly in these terms, we think he was in fact treating the institution of the suit as an intimation of the will of the plaintiff to put an end to the partnership. We are, in any case, quite at liberty to take that view of the matter and to hold that, having regard to the law as laid down in the case above referred to, the order of the District Judge is correct, even though his reasons might have been more clearly expressed.

Our decision, therefore, is that this appeal must be dismissed with costs.

Appeal dismissed.

G.S