1. This Memorandum of Appeal is filed under Section 96 of Civil Procedure Code, 1908 (for short ‘CPC’) assailing the judgment and decree passed in O.S.No.10 of 2010, dated 04.09.2018 by the learned XXVII Additional Chief Judge, City Civil Court at Secunderabad.
2.1. Appellant is the plaintiff and the respondents are the defendants in OS.No.10 of 2010.
2.2. Notice sent to respondent No.1 is returned ‘as left’. Sending notice to the address mentioned in the plaint is a proper service.
2.3. Notice got issued to respondent Nos.7 to 10 are served.
2.4. For the sake of convenience, parties will be herein after referred to as plaintiff and defendants.
3.1. The prayer in the suit is :
(a) Direct the defendants to render the accounts of the defendant No.1 Firm with relevant Audit reports from the financial year 2006-2007 till the date of filing the suit.
(b) Dissolve the partnership firm i.e., “Sridevi Enterprises” at house No.7-2-116, Sajjanlal Street, Monda Market, Secunderabad.
(c) To pass decree for 1/5th share in the profits of defendant No.1 Firm in favour of the plaintiff.
(d) To pass a preliminary decree by partitioning the suit schedule ‘A’ to ‘D’ properties by allotting 1/5th share in favour of the plaintiff
(e) To pass a decree in allotment of share of partnership estate.
3.2. The suit schedule properties are as under:
SUIT SCHEDULE ‘A’ PROPERTY
All that House constructed on Plot No.23 admeasuring 380 Sq.yards situated at Chandragiri Colony, Trimulgherry, Secunderabad, bounded on the :
North by : Plot No.22
South by : Plot No.24
East by : Plot No.7
West by : 30’ Wide Road
SUIT SCHEDULE ‘B’ PROPERTY
All that open Plot No.8 admeasuring 358.9 Sq.yards situated at Avanthi Colony, Kakaguda Village, Karkhana, Secunderabad, bounded on the :
North by : Neighbours Land
South by : 30’ Wide Road
East by : Neighbours Land
West by : Plot No.7
SUIT SCHEDULE ‘C’ PROPERTY
All that open Plot No.4 admeasuring 240 Sq.yards situated at Sainagar Colony, Medipalli Village, Peerzadiguda Grampanchayat, Uppal Mandal, R.R.District, bounded on the :
North by : Plot No.3
South by : Plot No.5
East by : 30’ Wide Road
West by : Plot No.45
SUIT SCHEDULE ‘D’ PROPERTY
All that open Plot No.41 admeasuring 222 Sq.yards situated at Sainagar Colony, Medipalli Village, Peerzadiguda Grampanchayat, Uppal Mandal, R.R.District, bounded on the :
North by : Plot No.42
South by : 40’ Wide Road
East by : Plot No.8
West by : 30’ Wide Road
3.3. It is stated in the plaint that the plaintiff’s husband by name I.Vaikuntam along with P.Purnachander Rao and I.Laxminarayana commenced a Proprietary business in the name of defendant No.3-I.Satyanarayana on paying monthly salary of Rs.150/- per month towards his services as he was pursuing his Graduation in the Evening College, the business was under the name and style of “Sridevi Enterprises” at H.No.7-2-116, Sajjanlal Street, Monda Market, Secunderabad. The business pertains to sale of seeds, fertilizers and pesticides and was established in the year 1973. The investment for the said business was totally contributed by P.Purnachander Rao and two others and was reaping good profits. Defendant No.3 - I.Satyanarayana proposed to stake claim over the said business by paying the capital as well as profits to P.Purnachander Rao. Defendant No.2 had entered into the arena of the said business to prepare the profit & loss account and he found that the business is making good profits, defendant Nos.2 and 3 intended to run the business by settling the accounts. The disputes to take over the business were not settled between the parties and the matter was referred to Arbitrator wherein the learned Arbitrator suggested for open auction of the business. Accordingly, auction was conducted on 17.07.1977 and the plaintiff's husband I.Vaikuntam and I.Laxminarayana were the highest bidders. The claim of P.Purnachander Rao was settled for Rs.32,462.03 Ps. and thereafter the business activities were taken over by the plaintiff and all the defendants. The investment was arranged by the plaintiff's husband I.Vaikuntam and the defendants. Defendant Nos.2 and 3 were Managing Partners and they were paid monthly salaries for the services rendered by them.
3.4. Partnership Deed was executed between the plaintiff and defendant Nos.2 to 5 on 26.08.1977. Defendant Nos.2 and 3 were managing the affairs of D1 Firm. In the year 1984, defendant No.1 purchased Plot No.23 at Trimulgherry, Secunderabad (‘A’ Schedule property) in the name of defendant No.2 out of the profits of defendant No.1 Firm and registered Sale Deed was executed to that effect vide document No.121 of 1984. Defendant No.1 also purchased ‘B’ schedule property i.e., Plot No.8, Avanthi Colony, Karkana, Secunderabad in the names of defendant Nos.2 and 3 out of the profits of defendant No.1 partnership business and a registered Sale Deed is executed to that effect vide document No.521 of 1989. Plaintiff and defendant Nos.2 and 3 in order to raise construction, raised columns for Ground and First floor in ‘A’ schedule property. Defendant No.1 paid token sale consideration in the year 1989 to purchase two open plots at Medipalli Village, Uppal Mandal, Ranga Reddy District with the knowledge of the plaintiff and without the knowledge of defendant Nos.4 and 5 with an evil intention and got the said plots registered in their wives names, balance sale consideration was paid out of defendant No.1 Firm funds, registered Sale Deeds were executed in the wife's names of defendant Nos.2 and 3 vide Sale Deeds bearing No.8143 of 1991 and 944 of 1992 (suit schedule ‘C’ and ‘D’ properties).
3.5. Plaintiff, defendant No.5 got issued legal notice on 19.04.1992 for appointment of Arbitrator and to settle the issue. Defendant No.2 issued reply stating that defendant No.1 Firm is not a partnership concern and it is a Proprietary concern and he has every right to swindle the amounts of defendant No.1 Firm. The matter is placed before the elders on 10.05.1997. An agreement was reduced into writing. FDRs in the names of defendant Nos.1 to 3 were scandalously deposited in the names of their wives by swindling the amounts from defendant No.1 Firm. When the same was questioned by the plaintiff, defendant Nos.2 and 3 started quarrelling with her and with her husband. Plaintiff has got issued another notice on 21.07.2009 to the defendants dissolving the Firm and for settlement of accounts and pay the share wherein the plaintiff is entitled for Rs.5 Lakhs approximately which was agreed before the Arbitrators for the financial year 2006-2007, prayed to decree the suit as prayed for.
4. Defendant No.1 Firm remained ex parte before the trial Court.
5. Defendant Nos.6 to 12 were added as parties to the suit but they did not contest.
6.1. Defendant Nos.2 to 5 filed their written statement and contended that the plaintiff’s son I.Anil Kumar filed false suit for perpetual injunction against defendant Nos.2 and 3 in OS No.202 of 2005 on the file of XI Junior Civil Judge, City Civil Court, Secunderabad, he also filed interim injunction application in the above said suit which came to be dismissed on 08.04.2005. Aggrieved by the order dated 08.04.2005 he filed CMA No.21 of 2005 which also came to be dismissed on 24.07.2006 against which he filed CRP No.4473 of 2006 before the High Court and the same was also dismissed on 13.10.2006. OS No.202 of 2005 came to be dismissed on 29.09.2007 against which an Appeal is filed vide AS No.225 of 2007, which also came to be dismissed on 13.08.2009 with costs of Rs.1002/- payable to defendant Nos.2 and 3. Defendant Nos.2 and 3 are the younger brothers of the plaintiff’s husband. Plaintiff’s husband I.Vaikuntam also filed partition suit vide OS No.9 of 2010 on the file of V Additional District Judge, Karimnagar against their mother who is bedridden. Plaintiff’s husband I.Vaikuntam is a Deputy Collector Rank Officer, got registered a criminal case against defendant Nos.2 and 3 by the Task Force Police vide CC No.1717 of 2005 on the file of XI Additional Chief Metropolitan Magistrate, Secunderabad. Plaintiff's daughter by name R.Aruna Kumari also filed a suit in OS.No.467 of 2008 in respect of Plot No.7 jointly owned by defendant Nos.2 and 3 on adverse possession. Defendant Nos.2 and 3 filed OS No.275 of 2005 on the file of XIII Additional Senior Civil Judge (FTC), City Civil Court, Secunderabad for partition and the same was decreed on 27.02.2009. OS No.467 of 2008 filed by the plaintiff's daughter came to be dismissed on the same day against which she filed an Appeal vide AS.Nos.63 of 2009 and 64 of 2009.
6.2. Defendant No.2 retired from the partnership business by addressing a letter to defendant No.3 through RPAD on 28.12.1996 (Ex.B8). Plaintiff is aware that defendant No.1 business is closed in the year 2005. Defendant No.3 surrendered the shop to the owner and he handed over all the files and documents pertaining to defendant No.1 Firm to the plaintiff’s husband. Plaintiff’s husband I.Vaikuntam is the elder brother of defendant No.2 and he did not hand over the files and documents. Plaintiff is not entitled to raise any dispute in respect of the said business after five years of closing the same. Defendant No.3 paid Rs.2 Lakhs for construction of Karimnagar house to the plaintiff's husband. Defendant Nos.2 to 5 have disputes with the plaintiff's husband. When the profits were earned by the Firm, defendant No.3 got deposited a sum of Rs.1 Lakh in Central Bank of India, Market Street Branch, Secunderabad. Defendant Nos.6 to 10 are the bona fide purchasers of the properties, prayed to dismiss the suit.
7. The learned trial court has framed the following issues:
1. Whether the suit schedule properties A to D are derived from partnership firm?
2. Whether D2 and D3 maintained accounts of D1 firm in accordance with Partnership Act?
3. Whether D2 and D3 are liable to render accounts of Partnership firm of D1?
4. Whether D1 firm was resolved as per Act?
5. Whether the defendants are liable to render accounts from the financial year 2006-2007?
6. Whether the partnership firm “Sridevi Enterprises” shall be declared as dissolved?
7. Whether the plaintiff is entitled for 1/5th share in the partnership firms and also entitled for preliminary decree?
8. Whether the suit ‘A’ to ‘D’ schedules are liable to be partitioned and whether plaintiff is entitled for 1/5th share in the said properties?
9. Whether the suit is barred by limitation?
10. Whether defendant with due limitation closed the partnership firm or not?
11. To what relief?
8. PW.1 is the son of the plaintiff and GPA holder and got marked Exs.A1 to A67. Defendant No.2 is examined as DW.1. Defendant No.3 is examined as DW.2 and got marked Exs.B1 to B9.
9. The learned trial Court after analyzing the evidence adduced by the parties has dismissed the suit of the plaintiff with costs.
10. Though defendant Nos.11 and 12 did not contest the suit, but they are contesting in the Appeal.
11.1. Learned counsel for the appellant-plaintiff submits that the learned trial Court did not consider the written arguments filed by the appellant-plaintiff, leave alone the oral submissions made across the bar and also failed to appreciate the law of partnership more particularly Sections 45 to 48 of the Indian Partnership Act, thereby resulted in wrong conclusions and miscarriage of justice and also failed to appreciate the admissions made by defendant Nos.2 and 3 in its proper perspective in respect of maintaining the accounts statement by them.
11.2. The findings of the learned trial Court on issue No.1 is totally contrary to the facts and also law, more particularly Section 14 of the Partnership Act. Suit schedule properties are purchased from the money of the Firm is not at all contradicted by cogent evidence and the reasoning given by the learned trial Court in Para Nos.15 to 24 is totally bereft of the appreciation of pleadings.
11.3. The findings of the learned trial Court on issue No.9 (bar of limitation) was clearly in contravention of the facts and law and the findings at Para Nos.26 to 37 of the impugned judgment do not make out any legal reasoning while dealing with issue No.9.
11.4. The learned trial Court failed to give cogent reasoning and findings on issue Nos.4, 6 and 10 having clubbed the same at Para Nos.38 to 48 of the impugned judgment and the learned trial Court failed to appreciate that the issue of dissolution of the Firm either has to be decided by the partners, by their act or by way of declaration by the Court having framed issue No.6, more particularly on the face of issue No.10. Rendition of accounts has to be in the mode and manner prescribed by Section 48 of the Partnership Act. The findings of the learned trial Court on issue Nos.2, 3 and 5 are bereft of legal and factual reasoning, resulted in miscarriage of justice.
11.5. The learned trial Court failed to appreciate that schedule ‘A’ and ‘B’ properties were purchased from the profits of defendant No.1 Firm, they are the assets of the Partnership Firm and also failed to appreciate that defendant Nos.2 to 5 colluded with each other and filed written statement being partners of the Firm. Defendant Nos.4 and 5 failed to plead that they have not accounted and distributed the profits of the Firm to the appellant-plaintiff. The impugned judgment clearly shows that the Firm is not at all dissolved and ought to have dissolved the same and directed for rendition of accounts. The learned trial Court failed to make out a case contrary to the written statement of the contesting defendants to dismiss the suit.
11.6. Exs.A4 and A5 are the documents issued by the Registrar of Firms in respect of defendant No.1-Partnership Firm in the year 1977. The findings of the Court below on dissolution of the Firm on basis of Ex.A1 by which defendant No.1 Firm became Partnership Firm by relying on the date of issue of certified copy of Exs.A4 and A5 is contrary to law. The findings of the Court below that the Firm is not “AT WILL” is contrary to the admitted facts and Exs.A4, A5 and A50 which clearly shows that defendant No.1-Partnership Firm is at will. The fact of the matter is that defendant Nos.2 and 3 have no independent source of income before starting defendant No.1 Firm so as to say that the properties standing in their names are not partnership properties. Schedule ‘C’ and ‘D’ properties are also properties of the Firm and the evidence adduced by the defendants is contradictory and the alleged owners in whose name the same stand did not enter into the witness box. Counsel to substantiate his contentions has relied on the following decisions in (1) Banarsi Das Vs. Kanshi Ram and Others (AIR 1963 SC 1165) (2) Pandurang Jivaji Apte Vs. Ramchandra Gangadhar Ashtekar (Dead) by LRs. and Others ((1981) 4 SCC 569) (3) Rattan Dev Vs. Pasam Devi ((2002) 7 SCC 441) (4) Shreedhar Govind Kamerkar Vs. Yesahwant Govind Kamerkar and Another ((2006) 13 SCC 481) (5) Pradip Buragohain Vs. Pranati Phukan ((2010) 11 SCC 108) (6) Peeran Sahib and another Vs. Pedda Jamaluddin Sahib and Others (AIR 1958 AP 48) (7) Arunachalam and Co. and Others Vs. M.Sadasivam (AIR 1985 MAD 354) (8) B.Janardhan Gupta (died) & another Vs. B.Padmanabha Gupta (1993 (2) A.P.L.J. 91 (HC)) (9) Mrs. Malini Rao Vs. Hotel Dwaraka and Others (1993 SCC OnLine AP 284).
12. Learned counsel for respondent Nos.2 to 5, 11 and 12 submits that the suit has been filed on 01.01.2010 by which date respondent No.1-defendant No.1 Firm was defunct, the business ended in losses and it was closed in the year 2005, the files including accounts were handed over by respondent No.3-defendant No.3 to appellant-plaintiff's husband who is his elder brothers. Appellant-plaintiff has not filed rejoinder denying the closure of business and shop or about handing over the records including accounts, the appellant-plaintiff who is the sleeping partner woke up suddenly after 5 years and filed the suit as if respondent No.1-defendant No.1 is running business and sought for dissolution, there is nothing to be dissolved. ‘A’, ‘B’, ‘C’, ‘D’ schedule properties are in the names of respondent Nos.2, 3 & 6 to 10-defendant Nos.2, 3 & 6 to 10 respectively. The appellant-plaintiff has not challenged the registered Sale Deeds under Section 31 or under Section 34 of the Specific Relief Act, 1963. Mere allegations that the properties were acquired from the profits of the Firm, they will not become Firm properties and that the appellant-plaintiff cannot seek a share in them. Appellant-plaintiff has not disclosed her source of knowledge nor adduced any evidence in support of her case. Appellant-plaintiff has admitted in Para 4 of the plaint that she was a sleeping partner of respondent No.1-defendant No.1 Firm. Appellant-plaintiff has not entered into the witness box but her son gave evidence as PW.1 who is not a competent witness who was 11 years when the Partnership Deed was executed. Appellant-plaintiff would have filed suit within three years from 2004 i.e., by 2007 under Article 137 of the Limitation Act, 1963, as the Firm was defunct and non-existing since 2004, it is deemed to be dissolved. Article 5 of the Limitation Act, 1963 is not attracted as per Ex.B8. Respondent No.2-defendant No.2 resigned from defendant No.1 Firm and respondent No.3-defendant No.3 handed over all the records to Sri Vaikuntam who is none other than the appellant-plaintiff’s husband after closure of the Firm. Counsel to substantiate his contentions has relied on the decisions in the cases of (1) Iswar Bhai C. Patel @ Bachu Bhai Patel Vs. Harihar Behera and Another ((1999) 3 SCC 457) (2) Vidhyadhar Vs. Manikrao and Another ((1999) 3 SCC 573) (3) Rattan Dev Vs. Pasam Devi ((2002) 7 SCC 441) (4) Janki Vashdeo Bhojwani and Another Vs. Indusind Bank Ltd. and Others ((2005) 2 SCC 217) (5) Man Kaur (Dead) by LRs. Vs. Hartar Singh Sangha ((2010) 10 SCC 512) (6) Ramesh Kumar and Another Vs. Furu Ram and Another ((2011) 8 SCC 613) (7) Mohinder Kaur Vs. Sant Paul Singh ((2019) 9 SCC 358).
13. Learned counsel for the appellant-plaintiff and respondent Nos.2 to 5, 11 and 12 – D2 to D5, D11 and D12 have filed their written submissions in support of their contentions.
14. Heard learned counsel, perused the material on record.
15. Now the points for consideration are :
1. Whether the plaintiff could able to prove that suit schedule A-D properties are acquired from the funds of D1-firm?
2. Whether the plaintiff has proved that D1 – firm be dissolved?
3. Whether the plaintiff is entitled to seek rendition of accounts of D1-firm from D2 – D5?
4. Whether the plaintiff is entitled for 1/5th share in suit schedule ‘A’ to ‘D’ properties?
5. Whether the plaintiff is entitled for 1/5th share in the profits of D1 – firm?
6. Can PW.1 (GPA Holder) completely substitute or replace the plaintiff for facts that are exclusive to the plaintiff’s personal knowledge?
7. Whether the suit is barred by limitation?
8. Whether the judgment and decree passed by the learned trial Court in OS No.10 of 2010, dated 04.09.2018 suffers from any perversity or illegality? If so, does it require interference of this Court?
POINT NOs.1 to 5 are inextricably linked, hence they are decided jointly :
16.1. Ex.A57 is the Partnership Deed dated 26.08.1977 which is executed by and between I.Satyanarayana, I.Gopal Kishan, I.Mahadev, I.Vijayalaxmi (defendant Nos.3, 2, 4 and 5) and I.Susheela (plaintiff). The important Clauses of the Partnership Deed are Clause No.5 to 11 which reads as under:
5. This partnership shall be deemed to have come into existence as on from 15.08.1977 and shall be one at WILL.
6. The parties of the first and second part shall be the Managing partners and they shall be in charge of the day to day affairs of the business of the firm.
7. Regular and proper books of accounts shall be maintained at the place of business by the Managing Partners. The books shall be open for inspection of other partners or their duly authorized agents at all reasonable times.
8. The books of accounts shall be closed to profit and loss on the 31st day of March, every year.
9. The Managing Partners 1 and 2 shall be entitled for allowances as agreed by all the partners.
10. The net profit or loss ascertained after meeting all the business expenses, taxes, interest on capital and allowances of Managing Partners shall be shared by the partners equally.
11. Bank account or accounts shall be in the name of the firm and they shall be operated under the signatures of any of the Managing Partners.
16.2. There is an Arbitration Clause (Clause No.14) in Ex.A57-Partnership Deed dated 26.08.1977 for resolving the disputes among the partners. The clause reads as under:
14. In the event of any disputes among the partners, the same shall be referred for arbitration or any three arbitrators choosen and appointed by all the partners and the decision of the majority of the arbitrators shall be final and binding on the partners.
17. Important Provisions of the Partnership Act, 1932, are Section 14, Sections 43, 44 and 48, which reads as under:
Section 14: The property of the firm.— Subject to contract between the partners, the property of the firm includes all property and rights and interests in property originally brought into the stock of the firm, or acquired, by purchase or otherwise, by or for the firm, or for the purposes and in the course of business of the firm, and includes also the goodwill of the business. Unless the contrary intention appears, property and rights and interests in property acquired with money belonging to the firm are deemed to have been acquired for the firm.
Section 43: Dissolution by notice of partnership at will.—
(1) Where the partnership is at will, the firm may be dissolved by any partner giving notice in writing to all the other partners of his intention to dissolve the firm.
(2) The firm is dissolved as from the date mentioned in the notice as the date of dissolution or, if no date is so mentioned, as from the date of the communication of the notice.
Section 44: Dissolution by the Court.—At the suit of a partner, the Court may dissolve a firm on any of the following grounds, namely:—
(a) that a partner has become of unsound mind, in which case the suit may be brought as well by the next friend of the partner who has become of unsound mind as by any other partner;
(b) that a partner, other than the partner suing, has become in any way permanently incapable of performing his duties as partner;
(c) that a partner, other than the partner suing, is guilty of conduct which is likely to affect prejudicially the carrying on of the business, regard being had to the nature of the business;
(d) that a partner, other than the partner suing, wilfully or persistently commits breach of agreements relating to the management of the affairs of the firm or the conduct of its business, or otherwise so conducts himself in matters relating to the business that it is not reasonably practicable for the other partners to carry on the business in partnership with hint;
(e) that a partner, other than the partner suing, has in any way transferred the whole of his interest in the firm to a third party, or has allowed his share to be charged under the provisions of rule 49 of Order XXI of the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908), or has allowed it to be sold in the recovery of arrears of land-revenue or of any dues recoverable as arrears of land-revenue due by the partner;
(f) that the business of the firm cannot be carried on save at a loss; or
(g) on any ground which renders it just and equitable that the firm should be dissolved.
48. Mode of settlement of accounts between partners.— In settling the accounts of a firm after dissolution, the following rules shall, subject to agreement by the partners, be observed:—
(a) losses, including deficiencies of capital, shall be paid first out of profits, next out of capital, and, lastly, if necessary, by the partners individually in the proportions in which they were entitled to share profits;
(b) the assets of the firm, including any sums contributed by the partners to make up deficiencies of capital, shall be applied in the following manner and order:—
(i) in paying the debts of the firm to third parties;
(ii) in paying to each partner rateably what is due to him from the firm for advances as distinguished from capital;
(iii) in paying to each partner rateably what is due to him on account of capital; and
(iv) the residue, if any, shall be divided among the partners in the proportions in which they were entitled to share profits.
18.1. Ex.A4 is the C.C. of Registration of Firms, dated 25.02.2009. Name of the Firm is M/s. Sridevi Enterprises (Defendant No.1) and Date of Registration is 20.09.1977, Duration of the Firm: at will. The partners are I.Satyanarayana (defendant No.3), I.Gopal Kishan (defendant No.2), I.Mahadev (defendant No.4), I.Vijayalaxmi (defendant No.5), I.Susheela (plaintiff). The date of joining is 15.08.1977. Ex.A5 is the certified copy of Form-C, dated 25.02.2009 pertaining to defendant No.1. Ex.A6 is the letter dated 25.04.1978 on the Letter Head of defendant No.1 signed by defendant No.2. Ex.A7 is the stock and payment particulars pertaining to defendant No.1 dated 01.04.1979. Ex.A8 is the letter dated 20.12.1980 given by defendant No.2 herein. The tenor of the letter is as under:
18.2(a). Ex.A9 is the letter head of defendant No.1 dated 01.04.1981 which shows the stock, payment, credits, capitals, deposits, interests to be paid and cash credits. Ex.A10 is the letter head of defendant No.1 dated 01.04.1984 which also shows the stocks, credits and cash balance.
18.2(b). Appellant counsel submits that Exs.A9 and A10 goes to show that payments are made to purchase schedule ‘A’ and ‘B’ properties, more particularly pointing out the credits shown in Ex.A10 i.e., Rs.60,000/- and Rs.45,000/-.
18.3(a). Ex.A11 is the certified copy of Sale Deed dated 18.01.1984 vide document No.121 of 1984 in respect of Plot No.23 admeasuring 380 square yards executed by M/s. Chandragiri Co-operative Housing Society Ltd., Hyderabad, in favour of I.Gopal Kishan (defendant No.2) and the total sale consideration is Rs.22,800/- (A-schedule property).
18.3(b). Ex.A11-Sale Deed goes to show that the purchaser – I.Gopal Kishan (defendant No.2) has already paid the sale consideration of Rs.22,800/-.
18.4. Ex.A12 is the certified copy of receipt dated 03.03.1989 vide receipt No.436 issued by the Avanti Co-operative Housing Society Ltd., in the name of I.Gopal Kishan (defendant No.2) for Rs.53,697.50ps vide cheque No.0029322 of Central Bank of India for Plot No.8.
18.5. Ex.A13 is another receipt dated 03.03.1989 issued by the Avanti Co-operative Housing Society Ltd., in favour of I.Gopal Kishan (defendant No.2) for an amount of Rs.45,000/- vide cheque No.003583 of Union Bank of India for Plot No.8(P). Ex.A14 is receipt dated 03.03.1989 for Rs.53,697.50ps vide cheque No.0029333 in favour of I.Satyanarayana (defendant No.3) for Plot No.8(P). Ex.A15 is C.C. of another receipt dated 03.03.1989 issued by the Avanti Co-operative Housing Society Ltd., in favour of I.Satyanarayana (defendant No.3) for an amount of Rs.45,000/- vide cheque No.003584 for Plot No.8 (P).
18.6. Ex.A16 is the certified copy of Sale Deed dated 03.03.1989 executed by the Avanti Co-operative Housing Society Ltd., in favour of I.Gopal Kishan and I.Satyanarayana (defendant Nos.2 and 3) for Plot No.8 in survey No.59/1/2 situated at Kakaguda, Secunderabad admeasuring 358.9 square yards (‘B’ schedule property).
18.7. Ex.A17 is the certified copy of sale deed dated 27.11.1991 vide document No.8143 of 1991 executed by Shaik Bikkumiya and four others through their GPA holder M.Bal Reddy in favour of Smt. I.Rama Devi (defendant No.11) in respect of Plot No.4 in survey No.69 admeasuring 240 square yards (suit schedule ‘C’ property). The entire sale consideration is shown as Rs.9,600/-. Defendant No.11 is the wife of defendant No.2.
18.8. Ex.A18 is the certified copy of Sale Deed dated 04.02.1992 vide document No.944 of 1992 executed by Shaik Bikkumiya and four others through their GPA holder M.Bal Reddy in favour of Smt. I.Shoba Rani (defendant No.12) for Plot No.41 admeasuring 222 square yards in survey No.69. The total sale consideration is Rs.8,880/- (suit schedule ‘D’ property). Defendant No.12 is the wife of defendant No.3.
18.9. Ex.A19 is the legal notice dated 19.04.1992 issued by I.Susheela (plaintiff) and I.Vijayalaxmi (defendant No.5) calling the parties to come for arbitration and settlement. Ex.A20 is the reply notice given by I.Satyanarayana (defendant No.3) to the notice dated 19.04.1992 stating that he is not agreeing for the appointment of Arbitrators named in the notice for settlement of any dispute and has no faith in the persons mentioned in the notice as Arbitrators. Ex.A21 is the letter issued by the plaintiff and defendant No.5 to the Branch Manager, Central Bank of India, Secunderabad to cease the Firm current account and fixed deposit of Rs.1 Lakh with immediate effect. Ex.A22 is the notice got issued by the plaintiff, defendant No.5 to the Joint Director, Agriculture, Hyderabad, dated 11.05.2022 that I.Satyanarayana (defendant No.3) who is one of the partners of Sridevi Enterprises cannot hold license in accordance with the provisions of the Insecticites Act, 1968 and requested to take action and see that the license is transferred in the name of the Firm i.e., M/s. Sridevi Enterprises.
18.10. Ex.A23 is the Agreement of Sale cum General Power of Attorney dated 02.02.2007 executed by I.Shoba Rani (defendant No.12) in favour of K.Manohar Reddy (defendant No.8) and another, the total sale consideration shown in the said document is Rs.2,77,500/- and the extent of land alienated is 111 square yards part of Plot No.41 on the Eastern side. Ex.A24 is the certified copy of Sale Deed dated 02.02.2007 executed by I.Shoba Rani (defendant No.12) in favour of A.Santosh (defendant No.10), the total sale consideration shown therein is Rs.2,77,500/- and the extent of land is 111 square yards which is parcel of Plot No.41 on the western side (entire extent of Exs.A23 and A24 is 222 square yards in Plot No.41-suit schedule ‘D’ property).
18.11. Ex.A25 is the office copy of legal notice dated 21.07.2009 issued by R.Subramanian, Advocate on behalf of I.Susheela (plaintiff) to I.Gopal Kishan (defendant No.2), I.Satyanarayana (defendant No.3), I.Mahadev (defendant No.4), I.Vijayalaxmi (defendant No.5) stating that Arbitration Award was passed directing them to honour the Award. Subsequent to Arbitration Award, there was a joint meeting at Manthani in the house of Late I.Vishwanatham on 05.07.2009 that first and second of them abused plaintiff’s husband and son in filthy language and called upon them to honour the Arbitration Award within 15 days. Ex.A28 is the reply notice got issued by I.Gopal Kishan-defendant No.2 to R.Subramanian, Advocate stating that the names mentioned in the notice dated 21.07.2009 (Arbitrators), they came to settle the immovable properties left by the parents but not as alleged in the notice, reply further goes to show that I.Gopal Kishan-defendant No.2 retired from the partnership firm and sent a letter by registered post with acknowledgment due on 28.12.1996 and he seized to be the partner of defendant No.1 Firm. No Arbitrator was appointed in the matter relating to defendant No.1. Ex.A29 is the reply notice got issued by I.Satyanarayana-defendant No.3 to R.Subramanian to the notice dated 21.07.2009 (Ex.A25) by denying the allegations and also denied the Arbitration Proceedings or any Award passed thereon.
18.12. Ex.A34 is the letter addressed by I.Anil Kumar-PW.1 to A.C.T.O., Hyderabad stating that the Managing Partners of M/s Sridevi Enterprises (defendant No.1) have not shown returns and the account books, being the son of the partner approaching the Civil Court to get share of profits and sought for Deed of Partnership and application submitted in the month of August, 1977 vide letter dated 17.03.2010. Ex.A35 is the carbon copy of undertaking dated 23.12.2004 executed by defendant Nos.2 and 3 and another person. Ex.A36 is the certified copy of issues submitted before the elders dated 28.12.2004. Ex.A37 is the certified copy of the Day wise proceedings of elders and Ex.A38 is the award passed by the elders on 28.12.2004.
18.13. Ex.A39 is the certified copy of Sale Deed dated 28.01.2011 executed by I.Rama Devi (defendant No.11) in favour of Md. Fakeer Ahmed (defendant No.6) and another vide Sale Deed No.541 of 2011. The extent is 240 square yards in plot No.4. The total sale consideration of the property is Rs.12 Lakhs (‘C’ schedule property). Ex.A42 is the Form-C issued by Government of Andhra Pradesh in the name of M/s. Sri Rama Chits and Finances, dated 13.11.1989. Ex.A44 is the letter submitted by the plaintiff to Income Tax Officer, AC Guards, Hyderabad, under RTI Act, 2005, seeking profit and loss accounts and balance sheet for the years 1990-91, 1991-92 and 1992-93.
18.14. Exs.A45 to 49 are in respect of M/s. Sri Rama Chits and Finances. Ex.A50 is the application submitted by the partners of defendant No.1 to Registrar of Firms on 12.09.1979. Ex.A52 is the letter issued by Public Information Officer to the plaintiff on 01.11.2016 and provided Xerox copies of Form-D, certificates of APGST/CST and Partnership Deed as sought for under RTI Act. Ex.A54 is the letter addressed by defendant No.2 as a partner of defendant No.1 to A.C.T.O., Secunderabad. The tenor of the letter states the constitution of change in Firm from Proprietary concern to Partnership Firm. Ex.A55 is the certificate of registration of defendant No.1 dated 10.12.1973 issued by the Assistant Commercial Tax Officer, Secunderabad. Ex.A56 is the letter addressed by defendant No.3 on 14.03.2005 to the A.C.T.O., Hyderabad to cancel the registration under the APGST Act, which letter is on the Letter Head of defendant No.1. Ex.A62 is the certified copy of Sale Deed, dated 16.12.1993 executed by I.Gopal Kishan (defendant No.2) in favour of I.Shobarani (defendant No.12) in respect of plot No.23 bearing survey No.55 in an extent of 190 square yards. The total sale consideration is Rs.1,95,000/- (part of ‘A’ schedule property).
Evidence of PW.1 :
19.1. PW.1 - I.Anil Kumar is the GPA holder of the plaintiff. His evidence in chief is in consonance with the contents of the plaint. In his cross-examination he stated that his mother cannot come to the Court to give evidence, since GPA is allowed and he is giving evidence. According to him, defendant No.1 Firm is not dissolved as on date. Defendant No.1 Firm was established in the year 1973, during that time he was 7 years old. Since 1973, defendant No.1 Firm is a Partnership Firm. Witness adds that in 1973, it was a Proprietary concern, investment was contributed by three persons and it became Partnership Firm in the year 1977. Proprietor of defendant No.1 Firm was defendant No.3 and Partnership Deed was executed in the year 1977 with the consent of all the partners. There is an arbitration clause with regard to the disputes between the partners. As per the arbitration clause, Arbitrator has passed an award in the year 2004 and there are five partners in the defendant No.1 Firm. Ex.A36 is the document showing the appointment of Arbitrator. They issued Ex.A19 Notice on 19.04.1992 seeking consent for appointment of Arbitrator. Defendant No.3 has not given consent and gave a reply under Ex.A20 that defendant No.1 is a Proprietary concern and they have not approached the High Court or District Court for appointment of Arbitrator. Defendants participated in the arbitration proceedings and did not comply with the award, hence, suit is filed in the year 2009 and numbered in the year 2010. Ex.A38 is the Award copy.
19.2. The contents of Ex.A22 are true and correct and defendant No.3 has deposited a sum of Rs.1 Lakh towards profits of defendant No.1 Firm. ‘C’ schedule property was sold after filing the suit and ‘D’ schedule property was sold prior to filing the suit i.e., in the year 2007 and he came to know about the sale of ‘D’ schedule property after filing the suit. According to the Sale Deeds (Exs.A17 and A18), I.Rama Devi and I.Shoba Rani are the owners of ‘C’ and ‘D’ schedule properties but the sale consideration was paid from the profits of defendant No.1 Firm. ‘A’ and ‘B’ schedule properties were purchased in the years 1984 and 1989. ‘A’ schedule property is in the name of defendant No.2 and ‘B’ schedule property is in the name of defendant Nos.2 and 3 and the four Sale Deeds relating to schedule ‘A’ to ‘D’ are registered as Sale Deeds. A question is put to the witness which reads as under:
Q): Prior to the present proceedings, whether any other proceedings are initiated against schedule ‘A’ to ‘D’?
A): Defendant Nos.2 and 3 stated that ’A’ to ‘D’ schedule properties are the properties of the Firm, thereby no action was initiated.
19.3. His mother did not do any business. Witness adds that when she joined in defendant No.1 Firm, his father has invested amounts in the defendant No.1 Firm when it was a Proprietary concern to a sum of Rs.30,000/-. Except, 26.08.1977 document, there is no other Partnership Deed. Defendant Nos.2 and 3 used to manage the affairs of the Firm being the Managing Partners. Defendant No.1 Firm was having accounts in South India Bank Limited, Central Bank of India, Monda Market Branch, in the name of defendant Nos.2 and 3. Accounts in Dena Bank, Central Bank of India belongs to Partnership Firm. All the profits were invested in purchasing schedule ‘A’ ‘B’ ‘C’ and ‘D’ properties till 2005. Defendant No.1 Firm is an Income Tax assesse and he is not in a position to file IT returns of the Firm. Witness adds that filing of Income Tax returns is the responsibility of defendant Nos.2 and 3. Since 1994, he had a doubt about the sincerity and integrity in running the business. The problem with defendant Nos.2 and 3 was sharing of profits. There is no mention in Ex.A19 – legal notice that the schedule properties are purchased from the profits of defendant No.1 Firm. Witness adds that defendant Nos.2 and 3 admitted that defendant No.1 is a Partnership Firm and schedule properties were purchased from the profits and the claim in Exs.A19 and A25 are different. As per Ex.A38 at Page 7 Para 2, it is mentioned that respective parties have to withdraw the respective proceedings before the Court and obtain certified copy of the same, handover to Sri P.Chandrashekhar for compliance. Witness adds that Ex.A38 is filed in Godavari kani Court in the years 2011 and 2012 and the said award is denied by defendant Nos.2 and 3.
19.4. Ex.A38 is signed by I.Chandrashekhar, I.Laxminarayana, I.Srinivas, I.Mahadev, I.Gopal Kishan and I.Satyanarayana. Defendant No.1 Firm is having five partners and the signature of defendant No.2 does not find place in each page except in page No.8. Another question is put to the witness during the course of his cross-examination which reads as under:
Q) Have you filed any documents showing the proof that schedule ‘A’ to ‘D’ properties are purchased from the profits of defendant No.1 Firm?
A) Exs.6 to 19 and Exs.36 to 38 shows that schedule ‘A’ to ‘D’ properties are purchased from the profits of defendant No.1 Firm.
19.5. No relief is claimed against defendant No.11 and defendant No.12 individually and there are no other documents except Exs.A1 to A50 to show that suit schedule ‘A’ to ‘D’ properties are purchased out of the profits of the defendant No.1 Firm. Defendant No.1 Firm FDRs are referred in the aforesaid exhibits, since they are made in the name of defendant Nos.2 and 3 and their family members, they are not in his custody. Approximately Rs.20 Lakhs are in the form of FDRs in the name of defendant Nos.2 and 3 and their family members and he did not take steps for getting the information from the Bank. Defendant Nos.2 and 3 never conducted any similar business as that of defendant No.1 Firm. All partners are collectively responsible for the acts of the Firm. Witness adds that the plaintiff is not responsible for the acts done by the other partners without the knowledge of her mother.
19.6. PW.1 denied the suggestion that defendant No.1 Firm was closed in the year 2005 and also denied the suggestion that defendant No.2 retired from the defendant No.1 Firm on 28.12.1996, he also denied the suggestion that he has knowledge that defendant No.1 Firm was running in losses, thereby, addressed a letter on 14.03.2005 to the concerned authorities for cancellation of registration and also denied the suggestion that Ex.A38 is not acted upon and is an invalid document. PW.1 denied the suggestion that schedule ‘A’ to ‘D’ properties are not purchased from the profits of the defendant No.1 Firm.
20.1. Ex.B1 is the certified copy of judgment and decree in OS No.467 of 2008, dated 27.02.2009 of the XIII Additional Senior Civil Judge, City Civil Court, Secunderabad, where in the suit is filed by R.Aruna Kumari against I.Gopal Kishan and I.Satyanarayana for declaration that she is the owner and possessor of land admeasuring 32.7 square yards by way of adverse possession in plot No.7 which came to be dismissed. Ex.B2 is the judgment and decree in AS.No.63 of 2009 where under R.Aruna Kumari, who is the plaintiff in OS.No.467 of 2008 preferred Appeal against the judgment and decree in Ex.B1. The said Appeal came to be dismissed by the learned I Additional Chief Judge, City Civil Court at Secunderabad on 10.09.2013. Ex.B3 is the judgment and decree in OS No.202 of 2015 dated 29.09.2007 passed by the XI Junior Civil Judge, City Civil Court at Secunderabad. The plaintiff therein is I.Anil Kumar (PW.1) and M/s. Anudeep Engineers and Contractors which is filed against I.Gopal Kishan and I.Satyanarayana seeking relief of perpetual injunction restraining the defendants therein from interfering with his possession in respect of the suit schedule property i.e., two rooms constructed in plot No.8 admeasuring 358 square yards (‘B’ schedule property). The suit filed by I.Anil Kumar in OS.No.202 of 2005 is dismissed under Ex.B3. I.Anil Kumar has preferred Appeal vide AS No.225 of 2007 which also came to be dismissed under Ex.B4 dated 13.08.2009 by the learned I Additional Chief Judge, City Civil Court, Secunderabad.
20.2. I.Gopal Kishan and I.Satyanarayana have filed suit in OS No.275 of 2005 against R.Aruna Kumari for partition and possession of 32.7 square yards in plot No.7 which came to be decreed under Ex.B5. Aruna Kumari has preferred Appeal vide AS No.64 of 2009 against the judgment and decree under Ex.B5, her Appeal came to be dismissed under Ex.B6. Ex.B7 is the certified copy of the order in CC No.1717 of 2005 dated 07.05.2009 passed by the XI Additional Chief Metropolitan Magistrate at Secunderabad wherein I.Gopal Kishan, I. Satyanarayana, Sita Ram, I.Mahadev were found not guilty for the offences punishable under Sections 143, 323, 506, r/w 34 of IPC and were acquitted for the charges.
20.3. Ex.B8 is the letter addressed by I.Gopal Kishan (defendant No.2) to I.Satyanarayana (defendant No.3) that he is retiring from respondent No.1 Firm as on today (28.12.1996) and requested to clear his accounts. The said letter is received by I.Satyanarayana which forms part of Ex.B8.
21.1. Defendant No.2 is examined as DW.1, his evidence is the replica of the written statement. In his cross-examination he stated that he entered into the business activities of defendant No.1 Firm in the year 1977. Plaintiff, himself, defendant Nos.3 to 5 are partners of defendant No.1 Firm. Defendant No.1 Firm was carrying on business in fertilizers and pesticides, himself and defendant No.3 are Managing Partners of defendant No.1 Firm. Ex.A4 is the Form-A issued by the Registrar of Companies and Ex.A5 is the Form-C acknowledgment of registration of firm. Under Ex.A4 names of the partners are reflected and Partnership Deed is executed under Ex.A57. Ex.A50 was signed and given to the Registrar of Firms, his role was to purchase material and sell them. Witness adds that until 1996, he was maintaining the accounts till then, thereafter defendant No.3 started maintaining the accounts. Witness further states that after 1996, he left defendant No.1 Firm and he informed the plaintiff accordingly, he has not executed any Retirement Deed from the Partnership Firm, witness adds that he has addressed a letter through a registered post to defendant No.1 Firm and requested to clear his accounts. A question is put to the witness which reads as under:
Q. Did you get any acceptance from defendant No.3 from retirement of the Partnership Firm?
A. I did not receive any reply to Ex.B8 and his accounts were not cleared.
21.2. He used to maintain Books of Accounts, Bank Accounts, Balance Sheets, Ledgers etc., to the knowledge of all the partners of defendant No.1 Firm. They are having Bank accounts in Central Bank of India, Monda Market Branch, Secunderabad. They obtained Trade License from APGST to run the Firm. Ex.A54 is the application for obtaining sales tax license which is addressed to Assistant Commercial Tax Officer, Hissamgunj, Secunderabad. Ex.A54 contains the shares of the partners and he has not filed any document pertaining to the sales tax license. The accounts were audited by one Mr. Vittal who is the Chartered Accountant, business returns were filed through him and he do not know exactly after 1996, he still continued in the business or not. He do not possess the Audit record from 1977 to 1996. The Audit records are left in defendant No.1 Firm and he do not have any acknowledgement to show that he handed over the records.
21.3. He has not filed Form-12 in the Court which will be with the IT Department and he is not concerned with Ex.A1 agreement. He has no knowledge about Ex.A1, he do not know the contents of Ex.A2 which does not bear his signature. Ex.A6 is written by him to his brother. Ex.A6 backside is not written by him and does not bear his signature and he has no objection to send Ex.A6 to Handwriting Expert. Defendant Nos.4 and 5 are also the partners in defendant No.1 Firm. Defendant No.11 is his wife and defendant No.12 is the wife of defendant No.3. Ex.A11-Sale Deed (‘A’ schedule property) belongs to him which consists of 380 square yards and he purchased the same in the year 1984, the sale consideration is Rs.34,000/- he paid them from his own funds. Apart from defendant No.1 Firm, he was carrying another business such as Vegetable Commission and also Chit Fund business, it was a partnership business. Plaintiff was a partner in the Chit Fund business.
21.4. To purchase ‘B’ schedule property, they borrowed amounts from the relatives and other source of business. Ex.A16 is the Sale Deed pertains to ‘B’ schedule property and plaintiff issued notice in the year 1992. Ex.A19 was issued by plaintiff and defendant No.5 to himself, defendant Nos.3 and 4, he did not give any reply to Ex.A19 and he do not know the contents of Ex.A20 reply given by defendant No.3. He is not admitting the contents of Ex.A19. Witness adds that it is not in accordance with the Partnership Deed. He know the contents of Ex.A21 but he denied the suggestion that both of them have swindled the amount.
21.5. DW.1 further stated in his cross-examination that there are Bank accounts of defendant No.1 Firm from 17.04.1992 till the date of his retirement in the year 1996, his account is not settled till date and he did not made any claims from defendant No.1 Firm. He do not know whether his name still exist as a partner in the register of Firms. He know that profit and losses are to be shared according to the ratio between the partners till his retirement (1996). All the partners have to share equally according to the Partnership Agreement. Defendant No.1 Firm was functioning after his retirement in the year 1996. He do not know whether his retirement letter is accepted or rejected and so also, he do not know the exact amount to be received by him from defendant No.1 Firm. Defendant No.1 Firm was not in loss when Ex.B8 was issued as he was there as a partner. He know the contents of Ex.A22 and he did not take any action against defendant No.3 after issuance of Ex.A22. I.Rama Devi-defendant No.11 is his wife and she executed Sale Deed in favour of defendant Nos.6 and 7. Ex.A19 was issued through a counsel to him, defendant Nos.3 and 4. The relationship was strained with the plaintiff from 1992 onwards. Mohan Rao, Advocate gave reply to Ex.A19 only for defendant No.3. Exs.A35 and 36 contains his signatures and Ex.A38 is written by him. Ex.A53 is the Firm Registration Form and Ex.A54 pertains to Proprietary Concern of the Partnership Firm. Ex.A65 is the Registration Form of defendant No.1 Firm. They filed common written statement. Witness was put a question which reads as under:
Q. Who has to evaluate the accounts of defendant No.1 Firm?
A. The remaining partners of defendant No.1 Firm who were there in the year 1996 have to evaluate the assets and liabilities of the defendant No.1 Firm.
21.6. DW.1 denied the suggestion that defendant No.4 has taken Rs.75,000/- from defendant No.1 Firm and defendant Nos.2, 3 and 5 are responsible for the suit claim. DW.1 also denied the suggestion that out of the income of defendant No.1 Firm he educated his two sons, performed their marriages and purchased the properties on their names and also denied the suggestion that there are FDRs of Rs.40 Lakhs in the name of defendant No.1 Firm.
22.1. Defendant No.3 is examined as DW.2 in the suit, his evidence is the same with that of the evidence of DW.1. In his cross-examination he stated that defendant No.2 entered into the business in the year 1977. Defendant No.2, plaintiff, defendant Nos.4, 5 and himself are the partners and they entered into partnership agreement in the month of August, 1977 (Ex.A57- Partnership Deed). Shares of each partner are mentioned in the Partnership Deed and it was registered before the Registrar of Firms. The Partnership Deed contains the names of all the partners. Defendant No.2 has maintained the account books till 1996. Thereafter, he started maintaining the books of accounts. Defendant No.2 has resigned from the Firm in the year 1996 and they have not informed the same to the Registrar of Firms about the resignation of defendant No.2. There is no retirement of partners of partnership Firm, none joined in the place of defendant No.2 and the dues of defendant No.2 are not settled. They used to maintain bill book, cash book, sales and purchase registers and one Vithal is the Auditor. After closure of the Firm in the year 2005, he has handed over all the books to the husband of the plaintiff and he has not informed the closure of defendant No.1 Firm to the Registrar of Firms. There is no acknowledgment from all the partners that he informed about the closure of the Firm. Ex.A55 contains three pages of certificate of registration. Ex.A54 contains 15 pages pertaining to members of the partners. Accounts are audited once in a year. Ex.A1-Agreement was written by Purnachandra Rao when he left the business in the year 1977 which contains his signatures also.
22.2. Ex.A2 pertains to Sridevi Enterprises and he do not know under what circumstances it was executed. Ex.A3 is on the letter head of Sridevi Enterprises and he was the Managing Partner of defendant No.1 Firm. Defendant No.2 was also the Managing Partner. As per Ex.A4-Registration of Firms, the partners are I.Satyanarayana, I.Gopal Kishan, I.Susheela, I.Vijaylaxmi who are continuing till date (26.02.2018). Ex.A5 Form-C was issued by Registrar of Firms. Exs.A6 and A7 are on the letter pads of defendant No.1. Ex.A11-Sale Deed belongs to plot No.23 of defendant No.2 which is in his name. In plot No.23, there is a Sale Deed in the name of his wife and his wife is a party to the suit as defendant No.12.
22.3. Since 1992 onwards, there is no cordial relationship between them. Plaintiff and defendant No.5 got issued notice under Ex.A19 and it is mentioned therein that Muralidhar, Manik Rao and Srinivasa Rao are to settle the disputes as Arbitrators. He issued Ex.A20-reply. Ex.A21 was addressed to the Branch Manager, Central Bank of India, pertaining to the Firm stating that himself and defendant No.2 are misappropriating the amounts. Ex.A23 was executed by his wife-defendant No.12 in favour of K.Manohar Reddy and Uma Shankar in respect of one plot situated at Medipally Village for ‘D’ schedule property. Defendant No.2 has handed over defendant No.1 business to him with profits. Thereafter, he ran the defendant No.1 Firm up to the closure. He did not issue any letter to the other partners that defendant No.1 business is running under loss and it has been closed. IT returns are filed from 1995 to 2005. Defendant No.12 has executed Ex.A24 in favour of one Santosh. He received Ex.A25- legal notice and he got issued reply under Ex.A29. Defendant No.2 has also issued separate reply. Defendant No.2 has mentioned in Ex.A28 that properties are not purchased from the Partnership Firm of defendant No.1. Ex.A36 contains his signature and there is a mention of the properties of defendant No.1 Firm. Defendant Nos.2 and 4 have also given their statements with regard to defendant No.1 Firm in Ex.A36. In Ex.A38 his signature is appearing.
22.4. There are two go-downs of defendant No.1 Firm and he handed over the go-downs prior to closing defendant No.1 Firm. He do not remember since which year defendant No.1 Firm was under loss. DW.2 denied the suggestion that they have created the Sale Deeds in the names of their wives and the properties under schedule ‘A’ to ‘D’ are purchased from the funds/profits of defendant No.1 Firm. He also denied the suggestion that himself and defendant No.2 obtained the sale deeds in the names of their wives with the funds of defendant No.1 Firm and also denied the suggestion that without giving profits to all the partners, himself and defendant No.2 have swindled the profits of defendant No.1 Firm.
23.1. That a partnership would be deemed to be dissolved when the summons accompanied by a copy of the plaint is served on the defendant, where there is only one defendant, and on all defendants, when there are several defendants. Since a partnership will be deemed to be dissolved only from one date, the date of dissolution would have to be regarded to be the one on which the last summons was served : See Banarasi Das1 (Constitution Bench) and the same view is followed in Arunachalam.
23.2. In absence of the deed of partnership, it might not be possible to arrive at a finding that the partnership was originally brought into the stock of the firm. The court will, therefore, have to proceed to determine the said question on the basis of the materials which are available on record : See Shreedhar Govind Kamerkar4.
23.3. In Malini Rao9, the High Court of Andhra Pradesh held that “Dissolution means extention of relationship which subsisted between all the partners of the Firm and thereafter they are entitled for winding up of the Firm.
24. Learned counsel for the appellant-plaintiff in his Additional Brief Synopsis contended that appellant-plaintiff and defendant No.5 are not parties to Ex.A36. Ex.A38 dated 28.12.2004 is an award passed in respect of properties of (1) Sri Illendula Chandrasekhar (2)Illendula Vaikuntam (3) I.Lakshminarayana (4) I.Srinivas S/o.Late Viswanadham (5) I.Mahadev (6) I.Gopalkishan and (7) I.Satyanarayana only. Appellant-plaintiff and defendant No.5 are not parties to the above said proceedings. Illendula Vaikuntam, Illendula Chandrasekar, Illendula Lakshminarayana and Illendula Srinivas are not parties to the suit. The award does not contain the signatures of the appellant-plaintiff and defendant No.5 and that of defendant No.2 as is evident from Ex.A38. Counsel further submits that respondent Nos.2 to 5 - defendant Nos.2 to 5 have stated in their written statement in Para 11 that “In this connection defendant Nos.2 and 3 states that the Arbitration Proceedings were for the properties left by their late father but not for the defendant No.1 firm, plaintiff was not present and nowhere she stated that she also participated in the said proceedings”. DW.2 has denied the arbitration proceedings in his chief-examination and in his cross-examination he stated that “Ex.A36 is of the year 2004 and there is no discussion of distribution of joint family properties before elders”. As on the date of the award, the defendant No.1 firm was not dissolved by the partners. Partnership firm is constituted by the partners under a contract and it is an independent entity. It is not the defence of the parties to the suit that the suit is not maintainable in view of Ex.A38. None of the parties have invoked Section 8 of Arbitration and Conciliation Act, 1996 but on the other hand, acquiesced to the jurisdiction of the Civil Court and participated in the trial. Section 11 of the Arbitration Act proceedings were also not initiated by either of the parties. Section 11 is mandatory in nature and relied on the decisions in the cases of (1) In Dharma Prathishthanam Vs. Madhok Construction (P) Ltd., ((2005) 9 SCC 686) (3 Judge Bench), the Supreme Court observed at Para No.31 which reads as under:
“31. Three types of situations may emerge between the parties and then before the court. Firstly, an arbitration agreement, under examination from the point of view of its enforceability, may be one which expresses the parties' intention to have their disputes settled by arbitration by using clear and unambiguous language, then the parties and the court have no other choice but to treat the contract as binding and enforce it Or, there may be an agreement suffering from such vagueness or uncertainty as is not capable of being construed at all by culling out the intention of the parties with certainty, even by reference to the provisions of the Arbitration Act, then it shall have to be held that there was no agreement between the parties in the eye of the law and the question of appointing an arbitrator or making a reference or disputes by reference to Sections 8, 9 and 20 shall not arise. Secondly, there may be an arbitrator or arbitrators named, or the authority may be named who shall appoint an arbitrator, then the parties have already been ad idem on the real identity of the arbitrator as appointed by them beforehand; the consent is already spelled out and binds the parties and the court. All that may remain to be done in the event of an occasion arising for the purpose, is to have the agreement filed in the court and seek an order of reference to the arbitrator appointed by the parties. Thirdly, if the arbitrator is not named and the authority who would appoint the arbitrator is also not specified, the appointment and reference shall be to a sole arbitrator unless a different intention is expressly spelt out. The appointment and reference both shall be by the consent of the parties. Where the parties do not agree, the court steps in and assumes jurisdiction to make an appointment, also to make a reference, subject to the jurisdiction of the court being invoked in that regard. We hasten to add that mere inaction by a party called upon by the other one to act does not lead to an inference as to implied consent or acquiescence being drawn. The appellant not responding to the respondent's proposal for joining in the appointment of a sole arbitrator named by him could not be construed as consent and the only option open to the respondent was to have invoked the jurisdiction of court for appointment of an arbitrator and an order of reference of disputes to him. It is the court which only could have compelled the appellant to join in the proceedings”.
(2) Zenith Fire Services (India) Pvt. Ltd., Mumbai Vs. Charmi Sales, Ahmedabad ((2013) 2 Mah LJ 623), the High Court of Bombay held at Para No.14 which reads as under:
“14. Mere appointment of Arbitrator by one party and admittedly when it was not mutual appointment, that itself also is not sufficient to treat valid appointment of the Arbitrator, as per clause as well as under the provisions of the Arbitration Act. The mutual consent is a must, even otherwise, to appoint sole Arbitrator. I am inclined to observe that such appointment of the sole Arbitrator cannot be accepted as valid and legal appointment by invoking the Doctrine of Acquiescence and/or Estoppal and/or Waiver. Considering the whole scope and purpose of Arbitration Act and specifically in view of the provisions of section 11 and the judgment of Supreme Court and even otherwise such unilateral appointment of Arbitrator itself is void, unjust and contrary to law. The whole proceedings therefore so initiated and continued also faces the same consequences. The consequential proceedings in view of this illegal appointment of sole Arbitrator is also bad”.
25. Counsel further submits that award passed without the consent of all the partners, or in the absence of the partners, in respect of partnership properties, that too by the arbitrators who were not appointed in accordance with law or by consent of the parties is illegal, void and unenforceable being contrary to settled principles of law governing arbitration and partnership rights. Exs.A36 and A38 proceedings are irrelevant.
26. Service of summons on the defendants is not available on the record. Defendant Nos.2 to 5 have filed their written statement on 09.06.2010. Appellant counsel submits that date of filing the written statement i.e., 09.06.2010 can be taken for the purpose of date of dissolution of firm which will not result in prejudice to any of the parties to the suit.
27. Defendant No.2 has purchased plot No.23 admeasuring 380 Sq.yards under Ex.A11 – Registered Sale Deed dated 18.01.1984 (Plaint ‘A’ schedule property) which speaks for itself that the purchaser has paid the sale consideration to the vendor.
28. Defendant Nos.2 and 3 have jointly purchased plot No.8, admeasuring 358.9 under Ex.A16 - Registered Sale Deed dated 03.03.1989 (Plaint ‘B’ schedule property). The document speaks for itself that the purchasers have paid the sale consideration to the vendor.
29. Ex.A17 is the certified copy of Registered Sale Deed dated 27.11.1991 in favour of defendant No.11 in respect of plaint ‘C’ schedule property. The document speaks for itself that sale consideration is paid by the purchaser to the vendor. Defendant No.11 has sold the property covered under Ex.A17 to defendant Nos.6 and 7 under Ex.A39 registered Sale Deed No.541 of 2011 dated 28.01.2011.
30. Defendant No.12 has purchased plaint ‘D’ schedule property under Ex.A18 – Registered Sale Deed dated 04.02.1992. The document speaks for itself that sale consideration is paid by the purchaser to the vendor. Defendant No.12 has sold an extent of 111 Sq.yards to defendant Nos.8 and 9 under Ex.A23 – Registered Sale Deed dated 02.02.2007 and sold the remaining extent of 111 Sq. yards to defendant No.10 under Ex.A24 - Registered Sale Deed dated 02.02.2007. Plaint ‘A’ to ‘D’ schedule properties stands in the name of defendant Nos.2, 3, 6 to 10.
31. Learned counsel for defendant Nos.2 to 5 and 11 & 12 submits that plaintiff has not challenged the Registered Sale Deeds under Section 31 or under Section 34 of Specific Relief Act. Counsel further contended that mere allegation that the properties have been acquired from the profits of the firm, they will not become the firm properties and that the plaintiff cannot seek a share. Plaintiff has not disclosed her source of knowledge nor has adduced any evidence to support her allegations which are baseless.
32. Ex.A8 - letter dated 20.12.1980 only refers to two plots in the Housing Society, it is silent with regard to the plot numbers, place and the names of the purchaser.
33. Ex.A10 dated 01.04.1984, on the back side only refers to an amount of Rs.80,000/- for a plot, there is no reference with regard to which plot the amount is shown. Ex.A12 is in the name of I.Gopal Kishan (defendant No.2) issued by Avanti Cooperative Housing Society dated 03.03.1989 with regard to plot No.8P and receipt of payment of Rs.53,697.50 by way of cheque of Central Bank. Ex.A13 is also a receipt issued by Avanti Cooperative Housing Society Limited dated 03.03.1989 in favour of I.Gopal Kishan for plot No.8P for Rs.45,000/- by way of cheque of Union Bank. Ex.A14 is also a receipt issued by Avanti Cooperative Housing Society Limited dated 03.03.1989 in the name of I.Satyanarayana (defendant No.3) for Rs.56,000/- and odd by way of cheque of Central Bank. Ex.P15 is also a receipt dated 03.03.1989 issued by Avanti Cooperative Housing Society Limited in the name of I.Satyanarayana for plot No.8P, Kakaguda showing the amount as Rs.45,000/-.
34. Ex.A11 pertains to ‘A’ schedule property which is purchased by defendant No.2 on 18.01.1984 through a Registered Document. A12 to A15 are of the same dates i.e., 03.03.1989 in the name of Gopal Kishan and I.Satyanarayana in respect of plot No.8P. Apart from the above said documents, there is no other material placed by the plaintiff to show that ‘B’ schedule property is purchased from the profits of defendant No.1 firm. There is no reference of plot numbers in Ex.A8 except mentioning two plots and there is no reference with regard to the payment of Rs.80,000/- for which plot. In absence of any evidence from the plaintiff side, it cannot be believed that suit schedule ‘A’ to ‘D’ properties are purchased from the profits of defendant No.1 firm. Furthermore, plaintiff has not entered into the witness box to give evidence about the facts which are within her knowledge.
35. It is the contention of defendant Nos.2 to 5 in their written statement that defendant No.2 has sent a letter through RPAD to defendant No.3 on 28.12.1996 about his retirement from the firm. It is further stated in the written statement that plaintiff is aware of the closure of the business in the year 2005 as the rents could not be paid and defendant No.3 has surrendered the said shop to the owner of the premises. There is no dispute that the parties have executed partnership deed on 26.08.1977. Plaintiff has got issued legal notice under Ex.A25 on 21.07.2009 to defendant Nos.2 to 5. The tenor of the notice goes to show that the first and second persons mentioned in the notice i.e., defendant Nos.2 and 3 have constructed a house and happily enjoying. Notice further states that plaintiff along with I.Vijayalakshmi – defendant No.5 got issued a legal notice on 19.04.1992 calling upon defendant Nos.2 to 4 to settle the issues or to participate in the arbitration proceedings. Defendant Nos.2 and 3 gave false reply through Rao and Company alleging that the business concern pertains to a Proprietary one. However, defendant Nos.2 and 3 have participated in different arbitration proceedings before G.Janardhan Reddy, P.Chandrasekhar, M.Nagendar, M.Muralidhar, P.Poornachander Rao, G.Shambaiah, D.Satyanarayana, Ch.Ramanaiah and Ch.Ranga Rao on 28.12.2004, gave an undertaking that they will oblige with the decision of the Arbitrators. Arbitration Proceedings were completed and an award was passed directing him to honour the arbitration award. Para 5 of Ex.A25 - legal notice called upon defendant Nos.2 to 5 to settle the issues relating to partnership business of “Sridevi Enterprises” by honouring the Arbitration Award within 15 days from the date of receipt of the notice.
36. Defendant No.2 gave a reply on 08.08.2009 under Ex.A28 stating that similar notice was received in the year 1992 and a fitting reply was given, after 17 years, another notice got issued by the plaintiff. The notice further states that since the firm was under losses, he retired from partnership firm by addressing a letter through Registered post acknowledgment due on 28.12.1996 and he ceased to be a partner thereafter, denied rest of the contents of the legal notice. Defendant No.3 has also got issued reply under Ex.A29 dated 10.08.2009 stating that he is the sole Proprietor of M/s. Sridevi Enterprises and denied the entire contents of the notice vide dated 21.07.2009.
37. Defendant No.1 firm is at will, plaintiff is seeking dissolution of partnership firm though Court. Plaintiff failed to prove persistent or willful breach of the partnership agreement by defendant Nos.2 to 5, also failed to prove misconduct by a partner affecting the business. Plaintiff has not placed any record to show continuous business losses making it impossible to carry on the business.
38. Plaintiff is also claiming 1/5th share in the profits of defendant No.1 firm. There is no record to show that defendant No.1 firm earned profits after deducting operational expenses, liabilities and third party debts, so also has not filed Bank statement, Invoices, Sales registers, GST returns or Income Tax filings. In absence of any evidence relief claimed cannot be granted.
39. Plaintiff has also failed to prove that plaint schedule properties belong to defendant No.1 firm, she did not file tax filing, balance sheet and capital accounts showing that the property was brought into the common stock or purchased using the firm funds.
40. The decisions cited by the appellant – plaintiff’s counsel are distinguishable from the facts of the present case, hence, they are not applicable to the case on hand. Point Nos.1 to 5 are answered accordingly.
POINT NO.6:
41. Learned counsel for the respondent-defendant Nos.2 to 5, 11 and 12 submits that plaintiff has not entered into the witness box and the evidence of PW.1 has to be rejected in toto.
42. Per contra, learned counsel for the appellant – plaintiff submits that adverse inference cannot be drawn against a party for his/her failure to appear in Court would arise only when there is no evidence on record.
43.1. In Pandurang Jivaji Apte (3 Judge Bench) of the Supreme Court held that “the question of drawing an adverse inference against a party for his failure to appear in Court would arise only when there is no evidence on the record”. The said finding is given by the Supreme Court in an Execution Proceedings.
43.2. In Rattan Dev, the Supreme Court held that “a mere absentation of the plaintiff himself from the witness box may pale into insignificance”.
43.3. If a man wrongfully withholds evidence, every presumption to his disadvantage consistent with the facts admitted or proved will be adopted : See Pradip Buragohain5.
Decisions cited by the respondent Nos.2 to 5, 11 and 12 counsel:
44.1. In Iswar Bhai C. Patel Alias Bachu Bhai Patel, the Supreme Court observed from Para Nos.18 to 29 which reads as under:
“18. As early as in 1927, the Privy Council in Sardar Gurbakhsh Singh v. Gurdial Singh, AIR 1927 PC 230 : 32 CWN 119, took note of a practice prevalent in those days of not examining the parties as a witness in the case and leaving it to the other party to call that party so that the other party may be treated as the witness of the first party. Their Lordships of the Privy Council observed as under:
"Notice has frequently been taken by this Board of this style of procedure. It sometimes takes the form of a manoeuvre under which counsel does not call his own client, who is an essential witness, but endeavours to force the other party to call him, and so suffer the discomfiture of having him treated as his, the other party's, own witness.
This is thought to be clever, but it is a bad and degrading practice. Lord Atkinson dealt with the subject in Lal Kunwar v. Chiranji Lal, ILR (1910) 32 All 104 : 37 IA 1 (PC) calling it 'a vicious practice, unworthy of a high-toned or reputable system of advocacy."
19. They further observed as under:
"But in any view her non-appearance as a witness, she being present in court, would be the strongest possible circumstance going to discredit the truth of her case."
20. Their Lordships also took note of the High Court finding which was to the following effect:
"It is true that she has not gone into the witness-box, but she made a full statement before Chaudhri Kesar Ram, and it does not seem likely that her evidence before the Subordinate Judge would have added materially to what she had said in the statement."
21. They observed:
"Their Lordships disapprove of such reasoning. The true object to be achieved by a court of justice can only be furthered with propriety by the testimony of the party who personally knowing the whole circumstances of the case can dispel the suspicions attaching to it. The story can then be subjected in all its particulars to cross-examination."
22. This decision has since been relied upon practically by all the High Courts. The Lahore High Court in Kirpa Singh v. Ajaipal Singh, AIR 1930 Lah 1, observed as under:
"It is significant that while the plaintiffs put the defendant in the witness-box they themselves had not the courage to go into the witness- box. Plaintiffs were the best persons to give evidence as to the 'interest' possessed by them in the institution and their failure to go into the witness-box must in the circumstances go strongly against them."
23. This decision was also relied upon by the Bombay High Court in Martand Pandharinath Chaudhari v. Radhabai Krishnarao Deshmukh, AIR 1931 Bom 97, which observed as under:
"It is the bounden duty of a party personally knowing the facts and circumstances, to give evidence on his own behalf and to submit to cross-examination and his non-appearance as a witness would be the strongest possible circumstance which will go to discredit the truth of his case."
24. The Lahore High Court in two other cases in 1934, namely, Bishan Das v. Gurbakhsh Singh, AIR 1934 Lah 63 (2), and Puran Das Chela v. Kartar Singh, AIR 1934 Lah 398, took the same view.
25. A Division Bench of the Patna High Court in Devji Shivji v. Karsandas Ramji, AIR 1954 Pat 280, relying upon the decision of the Privy Council in Sardar Gurbakhsh Singh v. Gurdial Singh and the Madhya Pradesh High Court in Gulla Kharagjit Carpenter v. Narsingh Nandkishore Rawar, AIR 1970 MP 225, have also taken the same view. The Madhya Pradesh High Court also relied upon the following observation of the Calcutta High Court in Pranballav Saha v. Tulsibala Dassi, AIR 1958 Cal 713.
"The very fact that the defendant neither came to the box herself nor called any witness to contradict evidence given on oath against her shows that these facts cannot be denied. What was prima facie against her became conclusive proof by her failure to deny."
26. The Allahabad High Court in Arjun Singh v. Virendra Nath, AIR 1971 All 29, held:
"The explanation of any admission or conduct on the part of a party must, if the party is alive and capable of giving evidence, come from him and the court would not imagine an explanation which a party himself has not chosen to give."
27. It was further observed:
"If such a party abstains from entering the witness-box it must give rise to an inference adverse against him."
28. A Division Bench of the Punjab and Haryana High Court also in Bhagwan Dass v. Bhishan Chand, AIR 1974 P&H 7, drew a presumption under Section 114 of the Evidence Act that if a party does not enter the witness-box, an adverse presumption has to be drawn against that party.
29. Applying the principles stated above to the instant case, it would be found that in the instant case also the appellant had abstained from the witness-box and had not made any statement on oath in support of his pleading set out in the written statement. An adverse inference has, therefore, to be drawn against him. Since it was specifically stated by Respondent 2 in his statement on oath that it was at the instance of the appellant that he had issued the cheque on the account of Respondent 1 in Central Bank of India Ltd., Sambalpur Branch and the appellant, admittedly, had encashed that cheque, an inference has to be drawn against the appellant that what he stated in the written statement was not correct. In these circumstances, the High Court was fully justified in decreeing the suit of Respondent 1 in its entirety and passing a decree against the appellant also.
44.2. In Vidhyadhar, the Supreme Court observed at Para No.17 which reads as under:
“17. Where a party to the suit does not appear in the witness-box and states his own case on oath and does not offer himself to be cross-examined by the other side, a presumption would arise that the case set up by him is not correct as has been held in a series of decisions passed by various High Courts and the Privy Council beginning from the decision in Sardar Gurbakhsh Singh v. Gurdial Singh. This was followed by the Lahore High a Court in Kirpa Singh v. Ajaipal Singh and the Bombay High Court in Martand Pandharinath Chaudhari v. Radhabai Krishnarao Deshmukh. The Madhya Pradesh High Court in Gulla Kharagjit Carpenter v. Narsingh Nandkishore Rawat also followed the Privy Council decision in Sardar Gurbakhsh Singh case. The Allahabad High Court in Arjun Singh v. Virendra Nath held that if a party abstains from entering the witness-box, it would give rise to an adverse inference against him. Similarly, a Division Bench of the Punjab and Haryana High Court in Bhagwan Dass v. Bhishan Chand drew a presumption under Section 114 of the Evidence Act, 1872 against a party who did not enter the witness-box”.
44.3. In Rattan Dev, the Supreme Court has referred to the decision in Iswar Bhai C.Patel V. Harihar Behera, (1999) 3 SCC 457, wherein it is emphasised that withholding of the plaintiff himself from the witness box and thereby denying the defendant an opportunity for cross-examination of himself results in an adverse inference being drawn against the plaintiff, and also observed at Para Nos.6 and 7 which reads as under:
“6. In the facts and circumstances of this case, remanding the matter to the High Court for rehearing would only prolong the life of the litigation. As we are satisfied of the failure on the part of the first appellate court in discharging its obligation - statutory and judicial, more so when it is a judgment of reversal, it would meet the ends of justice if the first appeal itself is directed to be heard afresh.
7. The appeal is allowed. The order of the High Court dismissing the appeal in limine as also the judgment and decree of the first appellate court are set aside. The appeal shall stand restored on the file of the first appellate court which shall be heard and decided afresh, consistently with the observations made hereinabove and in accordance with law”.
44.4. In Janki Vashdeo Bhojwani and Another, the Supreme Court observed at Para Nos.15 to 18 which reads as under:
“15. Apart from what has been stated, this Court in the case of Vidhyadhar v. Manikrao, (1999) 3 scc 573, observed at SCC pp. 583-84, para 17 that:
"17. Where a party to the suit does not appear in the witness box and states his own case on oath and does not offer himself to be cross-examined by the other side, a presumption would arise that the case set up by him is not correct...."”
16. In civil dispute the conduct of the parties is material. The appellants have not approached the Court with clean hands. From the conduct of the parties it is apparent that it was a ploy to salvage the property from sale in the execution of decree.
17. On the question of power of attorney, the High Courts have divergent views. In the case of Shambhu Dutt Shastri v. State of Rajasthan, (1986) 2 WLN 713 (Raj), it was held that a general power-of-attorney holder can appear, plead and act on behalf of the party but he cannot become a witness on behalf of the party. He can only appear in his own capacity. No one can delegate the power to appear in the witness box on behalf of himself. To appear in a witness box is altogether a different act. A general power-of-attorney holder cannot be allowed to appear as a witness on behalf of the plaintiff in the capacity of the plaintiff.
18. The aforesaid judgment was quoted with approval in the case of Ram Prasad v. Hari Narain, AIR 1998 Raj 185. It was held that the word "acts" used in Rule 2 of Order 3 CPC does not include the act of power-of-attorney holder to appear as a witness on behalf of a party. Power-of-attorney holder of a party can appear only as a witness in his personal capacity and whatever knowledge he has about the case he can state on oath but he cannot appear as a witness on behalf of the party in the capacity of that party. If the plaintiff is unable to appear in the court, a commission for recording his evidence may be issued under the relevant provisions of CPC”.
44.5. In Man Kaur (Dead) By LRs., the Supreme Court observed at Para Nos.14 to 17 which reads as under:
“14. In Vidhyadhar v. Manikrao, (1999) 3 SCC 573, this Court reiterated the following well-recognised legal position: (SCC pp. 583-84, para 17)
"17. Where a party to the suit does not appear in the witness box and states his own case on oath and does not offer himself to be cross- examined by the other side, a presumption would arise that the case set up by him is not correct...."
15. We may next refer to two decisions of this Court which considered the evidentiary value of the depositions of the attorney-holders. This Court in Janki Vashdeo Bhojwani v. Indusind Bank Ltd., (2005) 2 SCC 217, held as follows: (SCC pp. 222-24, paras 13, 17-18 & 21)
"13. Order 3 Rules 1 and 2 CPC empower the holder of power of attorney to 'act' on behalf of the principal. In our view the word 'acts' employed in Order 3 Rules 1 and 2 CPC confines only to in respect of 'acts' done by the power-of-attorney holder in exercise of power granted by the instrument. The term 'acts' would not include deposing in place and instead of the principal. In other words, if the power-of-attorney holder has rendered some 'acts' in pursuance of power of attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for the acts done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter of which only the principal can have a personal knowledge and in respect of which the principal is entitled to be cross-examined.
17. In Shambhu Dutt Shastri v. State of Rajasthan, (1986) 2 WLN 713 (Raj), it was held that a general power-of-attorney holder can appear, plead and act on behalf of the party but he cannot become a witness on behalf of the party. He can only appear in his own capacity. No one can delegate the power to appear in the witness box on behalf of himself. To appear in a witness box is altogether a different act. A general power-of-attorney holder cannot be allowed to appear as a witness on behalf of the plaintiff in the capacity of the plaintiff”.
18. The aforesaid judgment was quoted with approval in Ram Prasad v. Hari Narain, AIR 1998 Raj 185. It was held that the word 'acts' used in Rule 2 of Order 3 CPC does not include the act of power-of-attorney holder to appear as a witness on behalf of a party. Power-of-attorney holder of a party can appear only as a witness in his personal capacity and whatever knowledge he has about the case he can state on oath but be cannot appear as a witness on behalf of the party in the capacity of that party. If the plaintiff is unable to appear in the court, a commission for recording his evidence may be issued under the relevant provisions of CPC.
21. We hold that the view taken by the Rajasthan High Court in Shambhu Dutt Shastri Vs. State of Rajasthan, (1986) 2 WLN 713 (Raj), followed and reiterated in Ram Prasad Vs. Hari Narain, AIR 1998 Raj 185, is the correct view.”
16. In Shankar Finance & Investments v. State of A.P., (2008) 8 SCC 536, this Court explained in what circumstances, the evidence of an attorney-holder would be relevant, while dealing with a complaint under Section 138 of the Negotiable Instruments Act, 1881 signed by the attorney-holder of the payee. This Court held:
"15. ... A power-of-attorney holder of the complainant who does not have personal knowledge, cannot be examined. But where the attorney-holder of the complainant is in charge of the business of the complainant payee and the attorney-holder alone is personally aware of the transactions, and the complaint is signed by the attorney-holder on behalf of the complainant payee, there is no reason why the attorney-holder cannot be examined as the complainant. …
16. In regard to business transactions of companies, partnerships or proprietary concerns, many time the authorised agent or attorney-holder may be the only person having personal knowledge of the particular transaction; and if the authorised agent or attorney-holder has signed the complaint, it will be absurd to say that he should not be examined under Section 200 of the Code, and only the Secretary of the company or the partner of the firm or the proprietor of a concern, who did not have personal knowledge of the transaction, should be examined."
17. To succeed in a suit for specific performance, the plaintiff has to prove: (a) that a valid agreement of sale was entered into by the defendant in his favour and the terms thereof; (b) that the defendant committed breach of the contract; and (c) that he was always ready and willing to perform his part of the obligations in terms of the contract. If a plaintiff has to prove that he was always ready and willing to perform his part of the contract, that is, to perform his obligations in terms of the contract, necessarily he should step into the witness box and give evidence that he has all along been ready and willing to perform his part of the contract and subject himself to cross-examination on that issue. A plaintiff cannot obviously examine in his place, his attorney-holder who did not have personal knowledge either of the transaction or of his readiness and willingness. Readiness and willingness refer to the state of mind and conduct of the purchaser, as also his capacity and preparedness on the other. One without the other is not sufficient. Therefore a third party who has no personal knowledge cannot give evidence about such readiness and willingness, even if he is an attorney-holder of the person concerned”.
44.6. In Ramesh Kumar and Another, the Supreme Court has observed at Para No.21 which reads as under:
“21. The respondents-defendants did not step into the witness box to give their version, which leads to an adverse inference that if the defendants had examined themselves, their evidence would have been unfavourable to them [vide Section 114 of the Evidence Act, 1872 read with illustration (g) thereto]. They however examined five witnesses: C.B. Sharma, the arbitrator, was examined as DW 1; Ram Kumar, their power-of-attorney holder was examined as DW 2; Sudhir Sharma, their advocate who appeared in CSs Nos. 366 and 367 of 1992, was examined as DW 3; Chander Pal, said to be a member of the panchayat was examined as DW 4; and Devi Dayal, a court officer, was examined as DW 5 in connection with the production of documents from the court. They also got exhibited among other documents, the agreement of sale dated 18-10-1991, the reference agreements dated 12-3-1992 appointing C.B. Sharma as arbitrator, the statements of parties allegedly recorded by the arbitrator on 12-3-1992, the awards dated 13-3-1992 made by the arbitrator, the plaints, written statements and order-sheets all dated 16-3-1992 and the final order dated 30-3-1992 in CSS Nos. 366 and 367 of 1992, the decrees in terms of the awards and the declarations made by appellants on 31-3-1992. The oral evidence of the defendants' witnesses (DW 1 to DW 4) unfolds a story different from what was pleaded by them in their written statement. We may refer to the said evidence briefly”.
44.7. In Mohinder Kaur, the Supreme Court referred to the decisions of the Supreme Court with regard to the power-of- attorney holder at Para No.7 which reads us under:
“7. In Janki Vashdeo Bhojwani Vs. Indusind Bank ltd., (2005) 2 SCC 217, it was held that a power-of-attorney holder, who has acted in pursuance of the said power, may depose on behalf of the principal in respect of such acts but cannot depose for the principal for the acts done by the principal and not by the power-of-attorney holder. Likewise, the power-of- attorney holder cannot depose for the principal in respect of matters of which the principal alone can have personal knowledge and in respect of which the principal is entitled to be cross-examined. In our opinion, the failure of the respondent to appear in the witness box can well be considered to raise an adverse presumption against him as further observed therein as follows:
"15. Apart from what has been stated, this Court in Vidhyadhar v. Manikraos, (1999) 3 SCC 573, observed at SCC pp. 583-84, para 17 that:
'17. Where a party to the suit does not appear in the witness box and states his own case on oath and does not offer himself to be cross- examined by the other side, a presumption would arise that the case set up by him is not correct....' ".
45. PW.1 stated in Para No.1 of his affidavit that he is the son of the plaintiff and GPA holder. By the date of filing the affidavit that is in the month of December 2015 his age is shown as 48 years. Partnership Deed is executed between the parties on 26.08.1977 by which date he was eleven years old. PW.1 admitted in his cross-examination that defendant No.1 firm was established in the year 1973 and he was seven years old. Since 1973, defendant No.1 firm is a partnership firm. Witness again says that in 1973, it was taken as a Proprietary concern, investment was contributed by three persons and it became a partnership firm in 1977. Even by the year of 1977, PW.1 was a minor.
46. In view of the admissions made by PW.1 in his cross- examination, in the year 1977 he was still a minor.
47.1. In Shyam Kumar Inani Vs. Vinod Agrawal and Others (2024 INSC 865), the Supreme Court observed at Para Nos.22.5 and 35.2 which reads as under:
“22.5. Power of Attorney Holder's Limitations: The intervenor pointed out that the plaintiffs relied on Power of Attorney holder to prove the Agreement to Sell, which was contrary to settled law. The intervenor cited the case of In Janki Vashdeo Bhojwani & Anr. Vs. Indusind Bank Ltd. and Anr., (2005) 2 SCC 217 to argue that a Power of Attorney holder cannot depose for acts done by the principal unless they had direct knowledge of the transaction.
35.2. ----In this case, this Court clarified that while an attorney holder can definitely testify regarding the acts they have personally carried out on behalf of the principal, they cannot testify about matters requiring personal knowledge of the principal, such as the principal's state of mind or readiness and willingness to perform obligations under a contract. In the present case, the power of attorney K.D. Maheshwari was himself one of the vendees and all the transactions in the six suits having taken place simultaneously on the same day, same time and at the same place he was well aware personally of all the facts.
47.2. In Manisha Mahendra Gala and Others Vs. Shalani Bhagwan Avatramani and Others (2024 INSC 293), the Supreme Court observed at Para No.29 as under:
29. It is, therefore, settled in law that Power of Attorney holder can only depose about the facts within his personal knowledge and not about those facts which are not within his knowledge or are within the personal knowledge of the person who he represents or about the facts that may have transpired much before he entered the scene. The aforesaid Power of Attorney holder PW-1 had clearly deposed that he is giving evidence on behalf of plaintiff Nos. 2 to 4 i.e. the Gala’s. He was not having any authority to act as the Power of Attorney of the Gala’s at the time his statement was recorded. He was granted Power of Attorney subsequently as submitted and accepted by the parties. Therefore, his evidence is completely meaningless to establish that Gala’s have acquired or perfected any easementary right over the disputed rasta in 1994 when the suit was instituted.
48. PW.1 stated in his cross-examination that his mother knew more facts than him. The best person is the plaintiff to state about the business activities of defendant No.1 firm. She did not enter into the witness box for the reasons best known to her.
49. PW.1 has no personal knowledge nor has witnessed the transactions as an agent i.e., as a power-of-attorney holder. There is no explanation from PW.1 why the plaintiff is not examined in the suit. PW.1 when questioned that if plaintiff is examined on commission does he has any objection. The answer given by PW.1 is that since GPA is allowed basing on the orders passed he is giving evidence.
50. Plaintiff has not proved her case in any manner., Furthermore, she has not entered into the witness box to prove her contention that she is entitled for the reliefs prayed in the suit.
51. The decisions cited by the appellant counsel from Para Nos.43.1 to 43.3 are distinguishable from the facts of the present case and thus the ratio of those cases would not apply to the case on hand.
52. The decisions cited by the respondent Nos.2 to 5, 11 and 12 counsel from Para Nos.44.1 to 44.7 are applicable to the facts of the present case.
POINT NO.7 :
53. Learned counsel for the appellant – plaintiff submits that suit is filed within the limitation, the learned trial Court gave erroneous finding that the suit is barred by limitation. Counsel further submits that the limitation of filing suit for rendition of account will start from the date of dissolution of the firm. In the present case since the defendants admit that the firm was not dissolved the question of running of limitation does not arise. Period of limitation is prescribed under Article 5 of Limitation Act, 1963 wherein, the limitation starts from the date of dissolution of firm and not closure of the firm. Once a specific article governs the suit, the residuary article is not applicable. In the present case, since notice of dissolution is not given, it is settled law that service of summons of suit for dissolution of firm will be date of dissolution of the firm as it being a partnership at Will.
54.1. In Peeran Sahib6, the High Court of Andhra Pradesh held that residuary article can be invoked only in a case where there is no specific article governing a particular relief.
54.2. Suit for division of residual properties after firms dissolution need not be filed within three years from the date of dissolution : See B.Janardhan Gupta8.
55. Prayer (b) of the plaint is to dissolve the partnership firm (defendant No.1 – ‘Sridevi Enterprises’).
56. Section 44 of the Partnership Act deals with dissolution by the Court, the said Section is already extracted in Para No.17.
57. This Court is of the view that the period of limitation for filing the suit for dissolution of Partnership firm is three years under Article 113 of the Limitation Act when the right for sue accrues.
58. Ex.A19 is the legal notice dated 19.04.1992 got issued by the plaintiff and defendant No.5 to the defendant Nos.2 to 4 calling them to resolve the dispute with regard to movable and immovable properties, which fact is also stated in the plaint Para Nos.6 and 7. Defendant No.3 has got issued a reply under Ex.A20 on 25.04.1992 to the notice dated 19.04.1992 stating that he is the sole Proprietor of M/s. Sridevi Enterprises – defendant No.1. This Court is of the view that starting point of limitation commences from the date of issuing Ex.A19 – legal notice dated 19.04.1992. The plaintiff having kept silent for many years has again got issued another notice under Ex.A25 on 21.07.2009. A reply is issued by defendant No.2 under Ex.A28 on 08.08.2009 and by defendant No.3 under Ex.A29 on 10.08.2009. The plaintiff having got issued Ex.A19 – legal notice dated 19.04.1992 and called upon the defendant Nos.2, 3 and 4 to resolve the dispute, the period of three years under Article 113 of the Limitation Act is expired prior to issuing legal notice under Ex.A25.
59. The decisions cited by the appellant counsel are distinguishable from the facts of the present case and thus the ratio laid down would not apply to the case on hand.
60. This Court is of the view that the suit filed by the plaintiff is barred by law in view of the reasons above. Hence, Point No.7 is answered accordingly.
POINT NO.8 :
61. In view of the reasons above, this Court is of the view that the plaintiff has not made out any case to interfere with the judgment and decree passed by the learned trial Court, there is no perversity or illegality in the judgment. Appeal deserves no consideration and the same is liable to be dismissed and is accordingly dismissed.
62. CCCA No.79 of 2019 is dismissed without costs.
Miscellaneous petition/s if any, stands closed.
