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Judgment
The deft. is the applt. Certain properties belonging to the Thirumala Subramoniaswami Temple Devasthanam in Shencottah & Tenkasi Taluks were leased out by public auction for 5 agricultural years. The lease was taken in the name of the deft. at Rs. 9351 per year. The deft. happened to take the lease because of an agreement between him & the pltf. to hold an equal share in the lease-hold right. The pltf. had pursuant to this agreement, advanced Rs. 850 to the deft. Subsequently the deft. denied the pltf.''s half right in the lease & had refused to share the profits with him. The pltf. had, therefore, filed O. S. No. 27 of 1110 in the Munsiff''s Ct. of Shencottah for a declaration of his half rights over the properties in the Shencottah Taluk & for the necessary reliefs ancillary to the game. Though the deft. denied the partnership alleged by the pltf., the trial Ct. found that the partnership was true, that the lease-hold right over the properties scheduled in that suit belonged to the pltf. & the deft. in equal shares, that the deft. was to enter into the partnership deed with the pltf., & that the profits & loss were to be shared equally. The deft.''s appeal against this decree in the H. C. was A.S.41 of 1112. The trial Ct. decree was confirmed & the deft.''s appeal was dismissed with costs. But by the time the H. C. decree was passed in 1117, the period under the lease had expired. The pltf. had, therefore, filed the present suit for a settlement of accounts & to recover his half share on account of the profits derived from the properties in the Tenkasi Taluk.
The deft. contended that he had not taken the pltf. as a partner, that he had not received Rs. 850 from the pltf., that in view of the decree in O.S. 27 of 1110 the present suit was not maintainable, that the provision under Order 2, Rule 2 was a bar to the present suit, that the pltf.''s cause of action if at all arose on the 30th of Puratassi & Masi every year after the lease was taken, that the present suit filed on 16-11-1117 was barred by limitation & that the pltf. was not entitled to any relief. The pltf.''s replication re-affirmed his allegations in the plaint.
The trial Ct. had by an order dated 5-7-1118 held that in view of the prior suit O. S. 27 of 1110, copy of the judgment in that case being EX.III, the present suit was not maintainable under CPC (CPC) - Order 2, Rule 2. The suit was, therefore, dismissed. The pltf. took up the matter in the H. C. in A. S. 813 of 1118. This Ct. after considering the merits of the two cases held that the present suit was not open to the objection of bar under Order 2, Rule 2, CPC The trial Ct.''s decree dismissing the suit was, therefore, set aside & the case remanded with the direction to re-instate the suit on the file & dispose of it according to law. After remand the lower Ct. found that the agreement of partnership pleaded by the pltf. was true & that the suit was not barred by limitation. A preliminary decree was, therefore, passed for the taking of the accounts of the lease transaction. Certain directions as to how the accounts were to be taken had also been given. It was against this that the deft. had filed the present appeal.
Though an attempt was made at first to argue that by virtue of Ex. III decision this suit was not maintainable. It was given up as the matter had been concluded by the decision in A. S. 813 of 1118 by this Ct. The only other question that was argued in the appeal was one relating to limitation. As regards the arrangement between the parties, it had been decided once for all that the lease of the temple properties was taken in the name of the deft. with the definite understanding that the pltf. & the deft. were to have joint benefit of the lease hold right, that the pltf. should have one-half share in the partnership & that the deft. was to have the remaining half. It had been so found definitely in EX III case & that finding had been confirmed by the H. C. in Ex. IV judgment. A partnership between the pltf. & the deft. had, therefore, been established. This partnership began to be in force from the first of the Fasli year 1344. A Fasli year begins from the 1st of July & ends with the 30th of June. There is no doubt about this. In 1109 the 30th of June was on 17.11.1109. In Para. 3 of the plaint it had been stated that the lease was for 5 years from 17-11-1109. In Para. 2 of the written statement the deft. admitted this. So it was evident that the partnership between the parties began to operate from 17-11-1109 & that was for a period of five years. Even though in 1110 in Ex. III suit the deft. denied the partnership, it would not amount to a dissolution of partnership for what was confirmed in that case was the relationship of the pltf. & the deft. as patnrs. Subject to the contract between the patnrs. a firm is dissolved, if constituted for a fixed term 1 by the expiry of that term. That is the provision in Section 42 , Partnership Act. Though this Act; came into force in 1115, the principles under lying the same were being followed here. ln this case the partnership was for a period of five years & no partner was competent to terminate that partnership before the expiry of that term. If the partnership is one at will then there is no doubt that the firm can be dissolved by any partner giving notice in writing to all other partners of his intention to dissolve the firm. In an action by one of the patnrs. in the case of the partnership at will the denial of the partnership by the deft.-ptnr. had been held to be sufficient to dissolve the partnership. The ruling in Venkayya Naidu v. Lahshminarasayya 58 I. C. 969 : A. I. R.1920 Mad. 680 which accepted the leading English decisions on the subject in Syers v. Syers 1876 1 A.C. 174 : 35 L. T. 101 & Pearce v. Lindsay 1860 16 E. R. 591 : 3 De. G. J. & S. 139 is an authority for this position. This being not a partnership at will this ruling has no application.
This question had been considered by his Lordship, Agha Haidar in Jivian Singh Lakshmi Chand A. I. R. 1935 Lah. 192. It was held there that although a partner had an option to retire in the case of a partnership not entered into for a fixed period, he could not be made to retire or expelled by the other patnrs. for reasons of their own & that it was a question of law whether the alleged expulsion of a member effected by means of a communication operated by itself as for dissolution of the partnership which was not for a fixed term. It was considered that such notice of expulsion could not have the effect of dissolving the partnership. Though the deft. denied the partnership in Ex.III suit, such dental could not have the effect of a dissolution of a partnership. On, the other hand, the decree in the case passed by the trial Ct. in 1111 & confirmed by the H. C. in 1117 declared the relationship of the pltf. & the deft. as ptnrs. & confirmed the partnership pleaded by the pltf. There could, therefore, be no dissolution of partnership by virtue of the deft.''s pleading in that case. The partnership had its natural termination on 17.11-1114 with the expiry of the 5 years for which period alone the lease had been taken. The dissolution was, therefore, on 17.11-1114 & as such the suit for accounts had to be filed within 3 years from that date. Article 93, Limitation Act is, therefore, the proper article to be applied in this case. It provided for 3 years for a suit for accounts & share of the profits of a dissolved partnership from the date of the dissolution.
The argument of the applts. learned advocate that it was Article 52 or the residuary Article 109 that would apply to a suit of this nature (could not be accepted for there was a specific) Article which was intended to apply to suits of this nature. The present suit was filed on 16-11-1117, i.e. within 3 years of the dissolution of the partnership. It is, therefore, not barred by limitation.
No other point was argued before us. We agree with the lower Ct. in holding that the suit was not barred by limitation. The decree is therefore confirmed & this appeal dismissed with costs.