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Judgment
Subrahmanyam, J.—The point for decision in this civil revision petition is whether on the plaint the Plaintiff has to pay court-fee. u/s 37(2) of
the Court-fees Act as in a suit for partition and separate possession of property owned in common, or u/s 36(1) of the Court-fees Act as in a suit
for accounts of a dissolved partnership.
The Plaintiff and the first Defendant were doing business in partnership. The firm was dissolved in 1953 ; but the affairs of the firm had not been
wound up when the suit was instituted. The Plaintiff does not allege that, at the time of the dissolution or subsequent thereto, there was any
agreement between the partners regarding the manner of winding up the affairs of the partnership. He described in schedule ''A'' the assets of the
partnership and in schedule ''B'', the debts payable by the partners. He prayed for a decree directing partition and separate possession of his half-
share of the partnership assets. He prayed also that provision be made for the discharge of the debts specified in schedule ''B''.
The learned Subordinate Judge held that, on the plaint, court-fee was payable u/s 36(1) of the Court-fees Act and not, as had been done by the
Plaintiff, u/s 37(2) of the Act. He directed the Plaintiff to pay court-fee. u/s 36(1) and allowed him time for the purpose.
In this civil revision petition, the Plaintiff contends that the learned Subordinate Judge''s order is wrong, and that, on the plaint allegations, court-
fee is payable only u/s 37(2) of the Act.
Property which belonged to a partnership does not cease to be the property of the partnership by reason only of the dissolution of the
partnership. Section 47 of the Indian Partnership Act enacts that:
After the dissolution of a firm the authority of each partner to bind the firm, and the other mutual rights and obligations of the partners, continue
notwithstanding the dissolution, so far as may be necessary to wind up the affairs of the firm . . .
For purposes of winding up, the properties of the firm continue to be properties of the firm and do not, by reason of the dissolution, become the
properties of the partners as distinct from the firm. [Please see also Lindley on '' Partnership'', eleventh edition, page 723.] After the dissolution of
a partnership, the partnership is deemed to continue for the purpose of winding up and that which was partnership property continues to be such
until the accounts are wound up. The rights of the partners in relation to the properties on the dissolution of the partnership are thus stated in
Section 46 of the Indian Partnership Act:
On the dissolution of a firm, every partner or his representative is entitled, as against all the other partners or their representatives, to have the
property of the firm applied in payment of the debts and liabilities of the firm, and to have the surplus distributed among the partners, or their
representatives according to their rights.
The rules to be observed, subject to agreement by the partners, in settling the accounts of a firm after dissolution are laid down in Section 48 of
the Act. Section 48(6) is in these terms:
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.
That section makes it clear that payment of the debts of the firm out of the assets and the division among the partners of the residue are
processes in what is described as settling the accounts of the firm. During the subsistence of the partnership, a partner may, in a proper case, be
entitled to sue for dissolution and for accounts. After dissolution, a partner is entitled to sue for accounts, that is to say, for winding up the affairs of
the firm.
What the Plaintiff asks the Court to do in this particular suit is that provision be made for the discharge of the debts of the firm and that the
assets of the firm be divided between the partners. That relief is, in the language of Section 47 of the Partnership Act, the relief of winding up the
affairs of the firm. That relief is stated in Section 36(1) of the Madras Court-fees Act as: '' for accounts of a dissolved partnership ''.
The Plaintiff does not, in terms, pray for accounts of the dissolved partnership, but prays for partition and separate possession of the Plaintiff''s
half-share of the property claimed to be held in common. That relief arises on the facts stated in the plaint, viz., that the partnership was dissolved
and that its affairs have not been wound up. The relief prayed for thus arises out of the situation which is specifically provided for in Section 36(1)
of the Court-fees Act. Whatever the name which the Plaintiff may give to the relief he seeks, the relief is what is provided for in Sections 46 and 48
of the Partnership Act. On the facts stated by him, he gets relief under those sections or not at all.
The situation which necessitates the relief of partition is, according to the Plaintiff, a situation in which properties are owned in common but can
no longer be enjoyed in common. A situation of that kind might arise out of different sets of facts. Properties may be held in common, because the
co-owners were born as members of a family or because they happened to be joint heirs of a certain person or because they happened to acquire
the properties out of their joint exertions. According to the Plaintiff, properties may be held in common also when the properties are the properties
of a partnership which has been dissolved and whose affairs have not been wound up. Even assuming that the Plaintiff''s proposition on that point is
correct, that would be only one particular situation for which provision is made by Section 37(2). For this particular situation, however, specific
provision is made in Section 36(1).
Where a situation in which the Plaintiff seeks a relief stated in a section of the Court-fees Act is one of several situations in which the relief may
be prayed for but the particular situation is specifically provided for in another section of the Court-fees Act, court-fee should be paid under the
latter section and not under the former. (Please see the proviso to Section 9 of the Court Fees Act.) I find that the learned Subordinate Judge''s
order that court-fee was payable u/s 36(1) and not u/s 37(2) is correct. The civil revision petition is dismissed.