partnership firm

This tag is associated with 9 posts

Whether the 2nd defendant infringed the registered trademark of the plaintiff? 2. Whether the plaintiff is entitled for permanent injunction as prayed for? M/s. Swastiks Instant Food Products to M/s. Swastiks Masalas Pickles and Food Products Pvt. Ltd.D-2 has been doing manufacturing and distribution business from 1973 and the products are instant food products such as jamoon mix, rava idly, jalwa mix, masalas like sambar, rasam, garam masala, glucose powder, spices like chilly, dhania, turmeric and similar such products. Except the alleged similarity as sought to be shown in the name, no other similarities are pointed out by the plaintiff. Even the pouches as produced by the plaintiff do not disclose all other details as normally expected in respect of any of the items and giving the descriptions thereon. -whether the plaintiff has established his case rather than sift the evidence by shifting the burden on the defendant

HON’BLE SRI JUSTICE B. PRAKASH RAO AND HON’BLE SRI JUSTICE P. DURGA PRASAD C.C.C.A.No.208 OF 2003 Date:  30-04-2011 Between: Swastiks Instant Food Products ……. Appellant and Swastik Mirch Stores and others ……. Respondents   HON’BLE SRI JUSTICE B. PRAKASH RAO AND HON’BLE SRI JUSTICE P. DURGA PRASAD C.C.C.A.No.208 OF 2003 JUDGMENT: (Per BPR, J) The appellant is … Continue reading

Indian Partnership Act 1932–Sec. 69–Whether mandatory—Whether suit can be filed by unregistered firm–Dissolution of firm–Suit by a partner of erstwhile unregistered firm–If other partners of erstwhile firm necessary parties-Material alterations in a documents–Effect of–Suit for specific and ascertained amount–Whether court can make out new case and grant par- tial relief on another basis. Messrs.John & Co. were in financial difficulties and, therefore, entered into a financial agreement with Sethia & Co. a partnership firm of the plaintiff and Seth Sugan Chand. On 6th July, 1948 Messrs. John & Co. obtained anoth- er financial accommodation from Sethia & Co. Messrs. Tejka- ran Sidhkaran had also given some advances to Messrs. John & Co. The liability to the firm of Messrs. Tejkaran Sidhkaran was transferred to Sethia & Co. Seth Loonkaran Serbia filed a suit against John & Co. and his partners (defendants first set) as well as Messrs. John, Jain, Mehra & Co. and its partners. (defendants second set) for recovery of Rs. 21,11,500/- with costs and future interest and for a declaration that the plaintiff had a prior and floating charge on all the business assets of Messrs. John & Co. It was alleged by the plaintiff that the defendants (second set) entered into partnership with the defendants (first set ) under the name and style of Messrs. John Jain, Mehra & Co and maliciously induced them to commit breach of the agreement dated 6-7-1948 by forcibly turning out his representatives who used to remain in charge of the stocks, stores. coal, waste, etc., of the mills and making them enter into a financial agreement contrary to the terms of the agreement with his firm. The plaintiff also alleged that accounts were again settled on 4-4-1949 and a sum of Rs. 47,23,738/- was found due to him from the defend- ants. The defendants (first set) contended that there was no settlement of accounts; that the accounts were tainted with fraud and obvious mistakes and that on a true and correct accounting a large sum of money would be found due to them; that the plaintiff and said Sugan Chand obtained various documents, agreements, vouchers, receipts etc., and that the same were of no legal value as they were secured by the former by practising undue influence, fraud, coercion and misrepresentation; that the plaintiff had illegally and contrary to the agreement dated 6-7-1948 debited them with huge amounts which were not really due to them; that the cotton supplied by the plaintiff was of inferior quality and that the rates charged were exorbitant. It was also denied that the plaintiff had floating or prior charge on any of their stocks, stores, etc; that the suit was barred by the provisions Of section 69 of the Partnership Act and that the agreement dated 6-71948 which was insufficiently stamped could not form the basis of the suit. The defendants. (second set) also denied the claim of the plaintiff. The Trial Court held that the suit was maintainable; that the firm of Messrs. Sethia & Co. was dissolved before the institution of the suit; that the suit being one for the recovery of the assets due to a. dissolved partnership firm from a third party, was not barred by section 69 of the Partnership Act: that Seth Sugan Chand was not a necessary party to the suit; that the agreement dated 6-7-1948 was duly stamped and that no undue influence etc., was exercised by the plaintiff on the defendants; that there was no ac- counting on 4-4-1949 as alleged by the plaintiff and that both the plaintiff and the defendants (first set) committed a breach of the agreement dated 6-7-1948. The Trial Court also held that a charge was created in favour of the plain- tiff in respect of the entire business assets and that the defendants (second set) were liable to satisfy the plain- tiff’s claim. The Trial Court decreed the plaintiff’s suit to the extent of Rs. 18,00,152 but rejected his claim for specific performance and injunction. The Trial Court accord- ingly passed a preliminary decree against both the sets of defendants directing them to deposit 854 the said amount in the court within the prescribed time and in default gave the plaintiff a right to apply for a final decree for the sale of all the business assets, goods, stocks, stores, etc. The decree also gave a right to the plaintiff to apply for a personal decree against the defend- ants for the balance of his claim in case the net sale proceeds of the property of the firm were found insufficient to discharge his claim. The plaintiff filed an appeal in the High Court of Allahabad and the defendants also filed an appeal against the judgment of the Trial Court. The High Court allowed both the appeals partially holding that no fraud, undue influence, coercion or misrepresentation was practised by the plaintiff; that the agreement dated 6-7-1948 was neither insufficiently stamped nor did it require registration; that the deed of dissolution dated 22-7-1948 was prepared for the purpose of the case but there was sufficient evidence on the record to indicate that said Sugan Chand had withdrawn from the partnership carried on in the name of Serbia & Co. with effect from 30-6-1948; that Seth Sugan Chand was not a necessary party to the suit; that the suit was not barred. by section 69 of the Partnership Act; that the alterations in the deed dated 6-7-1948 were not material alterations and did not render the agreement void; that the plaintiff had a floating charge over the business assets of John & Co.; that it was defendants (first set) and not the plaintiff who committed breach of the’ agreement. The High Court, there- fore, passed a preliminary decree for Rs. 11,33,668/- in favour of the plaintiff and against the defendants (first set) but dismissed the suit with costs as against the de- fendants (second set). The High Court granted certificate under Article 133 in both the appeals. Dismissing the plaintiff’s appeal and allowing the appeal of the defendants (first set) held: (1) Section 69 of the Partnership Act is mandatory in character and its effect is to render a suit by a plaintiff in respect of a right vested in him or acquired by him under a contract which he entered into as a partner of an unregistered firm, whether existing or dissolved, void. [869 A] (2) A partner of an erstwhile unregistered partnership firm cannot bring a suit to enforce a right arising out of a contract failing within the ambit of section 69 of the Partnership Act. The suit out of which the appeals arise was for enforcement of the agreement entered into by the plaintiff as partner of Serbia & Co. It was never pleaded by the plaintiff not even in his replication that he was suing to recover the outstanding of a dissolved firm. Thus the suit was clearly hit by section 69′ and was not main- tainable. [869 B-C] (3) A close scrutiny of the document and other evidence clearly negatives the plaintiff’s claim that the firm was dissolved with effect from 30th June 1948. [865 C] (a) The agreement dated 6th July 1948 itself is signed by the plaintiff as a partner and the, expression partner also appears in the body of the agreement. [865 D] (b) The alleged deed of dissolution dated 22nd July 1948 between the plaintiff and Seth Sugan Chand was prepared on a stamp paper printed in the Government Press in November, 1948. The said Dissolution Deed was, therefore, clearly fabricated by the plaintiff. The plaintiff signed various cheques in July, 1948 as the partner of Sethia & Co. [865 F-H; 866 A-C; 867 F] (c) No service by post or advertisement in the newspaper about the dissolution was given either by the plaintiff or by Seth Sugan Chand. [867 F] (4) Seth Sugan Chand was a necessary party to the suit and in spite of the objections raised on behalf of the defendants the plaintiff did not care to implead’ Seth Sugan Chand. The suit was bound to fail on that ground also. [869 D-E] (5) A material alteration in a document without the consent of a party to, it has the effect of cancelling the deed. [870 A] Volume 12 of Halsburys Laws of England (Fourth Edition) referred to. 855 Nathu Lal & Ors. v. Musammat Gomti & Ors. (A.I.R. 1940 P.C. 160) relied on. In the present case there were many material alterations of the document. The material alterations, therefore have the effect of cancelling the deed in question. [870 B-D] (6) The plaintiff’s suit was for a specific and ascer- tained sum of money on the basis of settled account. The Courts below found concurrently that there was no settlement of account as alleged by the plaintiff on 4th April 1949. After that it was not open to the courts below to make out a new case for the plaintiff which he never pleaded. The courts be.low could have either dismissed the suit or passed a preliminary decree for accounts directing that the books of account be examined item by item and an opportunity allowed to defendants to impeach and falsify the accounts. [871 A-C]

PETITIONER: LOON KARAN SETHIA ETC. Vs. RESPONDENT: IVAN E. JOHN & ORS. ETC. DATE OF JUDGMENT20/10/1976 BENCH: SINGH, JASWANT BENCH: SINGH, JASWANT RAY, A.N. (CJ) BEG, M. HAMEEDULLAH CITATION: 1977 AIR 336 1977 SCR (1) 853 1977 SCC (1) 379 CITATOR INFO : D 1992 SC1740 (23) ACT: Indian Partnership Act 1932–Sec. 69–Whether mandatory—Whether suit … Continue reading

whether the appellant herein has made out a case for regular bail- the appellant is ordered to be released on bail on executing a bond with two solvent sureties, each in a sum of Rs. 5 lakhs to the 19

REPORTABLE   IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION CRIMINAL APPEAL NO. 348 OF 2012 (Arising out of S.L.P. (Crl.) No. 8995 of 2011)   Dipak Shubhashchandra Mehta …. Appellant(s)   Versus   C.B.I. & Anr. …. Respondent(s)     J U D G M E N T P.Sathasivam,J. 1) Leave granted.   … Continue reading

Delay -6500 days- On the part of Government litigant – Condonation of – Land ceiling proceeding – Land Tribunal holding that declarants were holding lands in excess of the ceiling limit – Writ petitions challenging the order of Tribunal by declarants and also by State – Writ by declarants withdrawn – State’s writ dismissed – Review filed by State alleging fraud on the part of declarant and the Secretary of Land Tribunal – Delay of 14 years in filing the Review – Dismissal of Review Petition – Special Leave Petition – Delay in filing of 6500 days against original order and 300 days against order in Review =Held: Delay, specially in cases where large tracts of land and large sums of revenue involved, is done to protect unscrupulous litigants at the cost of public interest/public exchequer – Courts though take liberal attitude in delay by Government, yet such attitude can be extended upto a certain limit – s.5 of Limitation Act must receive liberal construction so as to advance substantial justice – In the instant case, in order to protect public justice, delay condoned, subject to payment of exemplary cost of Rs.10 Lakhs – SLP to be admitted subject to payment of the cost – Limitation Act, 1963 – s.5 – Cost – Imposition of as a condition for condonation of delay – Constitution of India, 1950 – Article 136 – Admission of SLP, subject to payment of cost – Practice and Procedure – Karnataka Land Reforms Act, 1961 – s.66(4) – Administration of justice. G. Ramegowda, Major etc. v. The Special Land Acquisition Officer, Bangalore AIR 1988 SC 897 – relied on. State (NCT of Delhi) v. Ahmed Jaan 2008 (11) SCALE 455; Nand Kishore v. State of Punjab 1995(6) SCC 614 – referred to. Case Law Reference 2008(11)SCALE 455 Referred to. Para 15 1995 (6) SCC 614 Referred to. Para 16 AIR 1988 SC 897 Relined on. Para 19 CIVIL APPELLATE JURISDICTION : Special Leave Petiton (C ) Nos. 11398-11400 of 2009 From the Judgement and Order dated 07.11.1990 of the High Court of Karnataka at Bangalore in W.P. No. 40425 of 1982, W.P. No. 10920 of 1983 and order dated 26.09.2007 in R.P. 817 of 2004 in WP No. 40425 of 1982, C/W WP No. 10920 of 1983 Sanjay R. Hegde, for the Appellant(s).

REPORTABLE   IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION SPECIAL LEAVE PETITON (C ) NOS. OF 2009 (Arising out of CC Nos. 3324-3326 OF 2009) State of Karnataka …Petitioner Versus   Y. Moideen Kunhi( dead) by Lrs. And Ors. …respondents   JUDGMENT   Dr. ARIJIT PASAYAT, J   1. The special leave petitions … Continue reading

apex court reassessed the entire evidence on bank guarantee and set aside the High court judgement and restore the lower court judgment as correct= This is a letter written by defendant 1 to the plaintiff-bank in response to the demand notice dated 23/6/1984 issued to defendant 1. DW-1 in his evidence has admitted that the said letter (Ex-A6) was written by defendant 1.

NON-REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.4446 OF 2006   PUNJAB & SIND BANK … APPELLANT Vs. M/S. C.S. COMPANY & ORS. … RESPONDENTS   JUDGMENT   (SMT.) RANJANA PRAKASH DESAI, J.   1. The appellant – Punjab & Sind Bank (for short, “the plaintiff-bank”) has challenged in this … Continue reading

Indian Partnership Act, Section 69(2)-bar under-scope of-explained. The question involved in the instant appeal was whether a suit by an unregistered firm to enforce a right not arising from a contract to which it was a party or arising from a contract entered into by it in connection with its business, but for the enforcement of a right arising out of a contract entered into by its partner when the firm was his proprietary concern which he continued to the partnership when constituted was maintainable against third party and not barred under the provisions of section 69(2) of the Indian Partnership Act. =Allowing the appeals, the court HELD. 1.1 Once registration is granted, even though after the filing of the suit, the suit should be held to be maintainable as from the date on which registration is granted subject to the law of limitation. Subsequent registration of the firm would not cure the initial defect in the filing of the suit. [527-F-G; 528-D] M/s.Shreeram Finance Corporation v. Yasin Khan and Ors, [1989] 3 SCC 476; D.D.A. v. Kochhar construction Work and Anr., [1998] 8 SCC 559 and U.P. State Sugar corporation Ltd. v. Jain Construction Co. and Anr., [2004] 7 SCC 332, relied upon. 1.2. After coming into the existence of the partnership and having transferred to the said partnership all his assets and liabilities of his proprietary concern, the erstwhile proprietor has no subsisting exclusive right to enforce the liability against others since such rights as he had as the proprietor vested in the partnership, Such a partner in his personal capacity could not sue the respondent firm for the amount in question, if the firm of which he was a partner was for reason of non-registration unable maintain a suit. He can not, therefore, either file a suit for claim any relief in the suit filed by the partnership asserting his right as the erstwhile proprietor. [529-F-G] Addanki Narayanappa and Anr. v. Bhaskara Krishnappa (D) & Ors., [1966] 3 SCR 400, relied upon. 1.3. The bar under Section 69(2) would apply to a suit for enforcement of right arising from a contract entered into by the unregistered firm with a third party in the course of business dealings with such third party. If the right sought to be enforced does not arise from a contract to which the unregistered firm is a party, or is not entered into in connection with the business of the firm with a third party, the bar of Section 69(2) will not apply. [533-E-F] Haldiram Bhujiawala and Anr. v. Anand Kumar Deepak Kumar and Anr., [2000] 3 SCC 25, relied upon. Raptakos Brett & Co. Ltd. v. Ganesh Property, [1998] 7 SCC 184, referred to. 2.1. Observations made and principles laid down in a judgment if obiter do not have the force of a binding precedent. However, that does not preclude the Court from appreciating the reasons given for the principles laid down, and if the reasoning appears to the Court to be cogent, and merits acceptance, the same may be accepted by the Court and applied to the case before it. V.A. Mohta, B.J. Aggarwal, S.G. Hartalkar, J.S. Wad, Ashishwad, Neeraj Kumar, Arvind Gupta and Simanti Chakrabarti for the Appellant. S.V. Deshpande, Prashant Kumar, V. Sheshagiri and Rahul Prasanna Dave for the Respondents.=, 2006(8 )Suppl.SCR524 , , 2006(12 )SCALE232 , 2007(4 )JT564

CASE NO.: Appeal (civil) 4092 of 1998 PETITIONER: Purushottam & Anr RESPONDENT: Shivraj Fine Art Litho Works & Ors DATE OF JUDGMENT: 07/11/2006 BENCH: B.P. Singh & Altamas Kabir JUDGMENT: J U D G M E N T B.P. Singh, J In this appeal by special leave the plaintiffs are the appellants. Their suit against … Continue reading

Partnership Act, 1932: s. 29(2) – Right of transferee under heirs of partner of dissolved partnership – partnership of two brothers being co-owners of property dissolved due to death of one of them – Heirs of deceased partner transferring suit property – Right of transferee in possession to obstruct delivery of possession to auction purchaser in execution of decree in a suit for recovery of dues against erstwhile partnership – Held, partnership having stood dissolved after death of one partner, his heirs could transfer the property, and transferee having been put in possession had right to obstruct delivery of possession to auction purchaser – Code of Civil Procedure, 1908 – Order 21, r.97. Two brothers being co-owners of certain property formed a partnership. One of them died later and with that the partnership firm stood dissolved. Legal heirs of the deceased partner transferred the suit property through a sale deed to the predecessor-in-interest of the respondents. Thereafter a third party filed a suit for recovery of certain amount against the said partnership firm. The vendee was not a party to the said suit. The suit was decreed and the suit property was auctioned in execution of the decree to the appellant, who claimed delivery of possession. The vendee under the sale deed obstructed thereto and the appellant-auction purchaser filed an application for removal of obstruction. The executing court dismissed the application holding that legal heirs of deceased partner could sell the property and the respondents were lawful owner thereof. The appeal of the auction purchaser was dismissed so also was his second appeal. In the instant appeal filed by the auction purchaser it was contended on his behalf that respondents not being the legal heirs of the dissolved firm they did not derive any share and as such they had no right to offer resistance. =2007 AIR 1501, 2006(10 )Suppl.SCR1234, , 2006(14 )SCALE75 , =Dismissing the appeal, the Court HELD:1.1. A distinction exists between the right of a partner to sell a property during subsistence of the partnership and the right of an erstwhile partner to sell the property of the firm after it stood dissolved. In the instant case, the partnership stood dissolved on the death of one partner, whose heirs and legal representatives, therefore, could transfer the property at least to the extent of their own share. [1236-G-H] Addanki Narayanappa and Anr. v. Bhaskara Krishnappa (dead) and thereafter his heirs and Ors., AIR (1966) SC 1300, referred to. 1.2. It has been found as of fact by all the three courts below that after purchasing the property from the heirs and legal representatives of the deceased partner, the respondents had been put in possession and they had been residing therein when the auction sale was effected. They had caused some improvements and a new building had also been constructed by them. As the suit was filed after the deed of sale was executed and registered, the respondents predecessor, in interest was a necessary party. He was not arrayed as a party in the suit. He having been found to be in possession of the property as on the date when the delivery of possession of the property was sought to be effected, a `fortiori’ he had a right to obstruct thereto. B.V. Deepak (NP) for the Appellant. C.S. Rajan, Fazlin Anam and E.M.S. Anam for the Respondent.

CASE NO.: Appeal (civil) 10588 of 1995 PETITIONER: M.V. Karunakaran Appellant RESPONDENT: Krishan Respondent DATE OF JUDGMENT: 15/12/2006 BENCH: S.B. Sinha & Markandey Katju JUDGMENT: J U D G M E N T S.B. SINHA, J : Auction purchaser is the appellant before us being aggrieved by and dissatisfied with a judgment and order dated … Continue reading

Partnership Act : 1832 : Partnership firm-Re-registration-Effect of-Firm registered in 1949-Again registered comprising some of the original partners in 2005 with the same name-Earlier firm not dissolved-Held, registration of the firm in the same name again in 2005 does not affect the status of the firm. Arbitration and Conciliation Act, 1996 : ss. 9 and 11 (4) (b)-Interim order by District Judge u/s 9-Propriety of-Arbitration clause is an agency agreement-Agreement for a specific period having come to an end-Parties nominating their respective arbitrators but both the arbitrators so nominated failing to nominate presiding arbitrator-Application u/s 11 (4)(b) before Chief Justice of High Court for appointing third arbitrator-Meanwhile on application, District Judge granting interim order to maintain status quo until arbitral tribunal takes the matter-High Court vacating the interim order-Held, Adequate grounds are not made out at this interlocutory stage for interfering with order of High Court and parties are left to have their disputes resolved in terms of arbitration agreement-As agreed by both the parties, sole arbitrator appointed to decide the disputes between the parties-Except the question of maintainability of appeal filed by respondent before High Court on the pretext of re-registration, since, the appeal has been held to be maintainable, all the other questions are left open for decision by the sole arbitrator. Respondent no. 1, a partnership firm was constituted in the year 1949 bearing registration no. 71/1949. It was reconstituted in subsequent years taking in some additional partners. On 14.3.1991 the respondent-firm entered into an agency agreement with the appellant, a private limited company, engaging the latter as a raising contractor in respect of the mines for which the former had obtained leases from the State Government. On 25.3.1991 the respondent firm executed an irrevocable power of attorney in favour of the appellant authorizing it to administer the mines and sell the iron ore extracted therefrom. The agency agreement was to end on 31.3.2006. The appellant sought a further extension of the term but respondent no.1 was not willing for an extension. Disputes arose between the parties and by a letter dated 9.12.2005 the appellant invoked the arbitration clause in the agency agreement and nominated its arbitrator. The respondent firm registered itself again on 24.12.2005 bearing registration no. 595/2005. It, however, in turn also nominated an arbitrator. The arbitrators so nominated were to name the presiding arbitrator but since they failed to do so the appellant filed a petition under Section 11(4)(b) of the Arbitration and Conciliation Act, 1996 requesting the Chief Justice of the High Court to appoint the third arbitrator. While the said application was pending, the appellant company also filed an application under Section 9 of the Act before the District Judge for interim relief to permit it to continue to carry on the mining operations and to restrain the respondent from interfering with it. The District Judge directed status quo to be maintained until arbitral tribunal was constituted to adjudicate the dispute between the parties. The respondent filed an appeal before the High Court which held that since prima facie the agreement between the parties was not a specifically enforceable one in terms of the Specific Relief Act and since the terms of the agreement had expired, it was not appropriate to grant the interim order, and reversing the order of the District Judge, dismissed the application filed by the appellant-company. Aggrieved, the latter filed the instant appeal. It was contended for the appellant that it had entered into agreement with the firm bearing registration no. 71/1949, and since the appeal before the High Court was filed by the firm bearing registration no. 595/205, the same was not maintainable; that since the agreement entered with the appellant was, in the light of irrevocable Power of Attorney, co-terminus with the mining lease granted to the respondent firm, the same could not be terminated and would not come to an end by efflux time; and that powers under Section 9 of the Act, were independent of any restrictions placed by Specific Relief Act. =Dismissing the appeal, the Court HELD: 1. It was the appellant who filed the application under Section 9 of the Arbitration and Conciliation Act, 1996 impleading the respondent firm and its partners. The said firm represented by a partner, who even admittedly was a partner of the firm as constituted in the year 1949 and was also a party to the agreement with the appellant-company itself, had filed the appeal before the High Court. There is no case that the firm registered in the year 1949 had been dissolved. On the other hand, it was being reconstituted from time to time. Therefore, the fact that a firm in the same name was again registred in the year 2005, does not affect the status of the firm with which the appellant-company had a contract and the filing of the appeal by that firm represented by its partner. [Part 11] [187-B, C, D] 2. The effect of the agreement dated 14.3.1991 and the Power of Attorney dated 25.3.1991 admittedly executed between the parties and the rights and obligations flowing therefrom are really matters for decision by the Arbitral Tribunal. [Para 12] [187-F] 3.1. In the facts and circumstances, prima facie, it is not possible to say that the High Court was wrong in thinking that it may be a case where an injunction could not be granted in view of the provisions of the Specific Relief Act. But, that again will be a question for the arbitrator to pronounce upon. Suffice it to say that the position is not clear enough for this Court to assume for the purpose of this interlocutory proceeding that the appellant is entitled to specifically enforce the agreement dated 14.3.1991 read in the light of the Power of Attorney dated Of course, this aspect will be again subject to the contention raised by the appellant-company that the agreement created in his favour was co-terminus with the mining lease itself. But, these are the aspects to be considered by the Arbitral Tribunal Adequate grounds are not made out by the appellant at this interlocutory stage for interfering with the order of the High Court. In that view alone, it would be proper to decline to interfere with the order of the High Court and leave the parties to have their disputes resolved in terms of the arbitration agreement between the parties. [Para 13 and 14] [188-B, C, D, E] 4. The argument that the power under Section 9 of the Act is independent of the Specific Relief Act or that the restrictions placed by the Specific Relief Act cannot control the exercise of power under Section 9 of the Act cannot prima facie be accepted. Suffice it to say that prima facie exercise of power under Section 9 of the Act must be based on well recognized principles governing the grant of interim injunctions and other orders of interim protection or the appointment of a receiver. [Para 15] [188-F; 189-C, D] Firm Ashok Traders and Anr. v. Gurumukh Das Saluja and Ors., [2004] 3 SCC 155, held inapplicable. 5. It is seen that in spite of the parties naming their respective arbitrators in terms of the arbitration agreement, the arbitrators so appointed had not been able to nominate a presiding arbitrator. Since counsel on both sides agreed that this Court may appoint either a presiding arbitrator or a sole arbitrator for the purpose of resolving the disputes between the parties from the panel of names furnished, the Court appointed the sole arbitrator to decide on the disputes between the parties springing out the agreement dated 14.3.1991 and the Power of Attorney dated 25.3.1991. The arbitrator would be free to fix his terms in consultation with the parties. [Para 16] [189-D-G] Dr. A.M. Singhvi, Jaideep Gupta, Sr. Adv., Ashutosh Kaitan, P.K. Bansal, Deepak Khurana, Vishvjit Das, Umesh Kumar Khaitan, Amit Bhandari for the Appellant. A.K. Ganguly, Surya Prakash Mishra, K.K. Venugopal, Sr. Adv., S. Ravi Shankar, Rateesh, Barnali Basak, Visushi Chandana, S. Ravishankar, Yamunah Nachiar, S. Ravishankar for the Respondents.

CASE NO.: Appeal (civil) 2707 of 2007 PETITIONER: M/s Arvind Constructions Co. Pvt. Ltd RESPONDENT: M/s Kalinga Mining Corporation & Ors DATE OF JUDGMENT: 17/05/2007 BENCH: TARUN CHATTERJEE & P.K. BALASUBRAMANYAN JUDGMENT: J U D G M E N T CIVIL APPEAL NO. 2707 OF 2007 (Arising out of SLP(C) No. 3294 of 2007) P.K. … Continue reading

Code of Civil Procedure, 1908 – O. 38 r. 5 – Attachment before judgment -Application for, against partnership firm and its partners – Challenge to, on the ground that borrower was not a partner and borrowal of money was not for the benefit of the firm – Held: All of them were partners at the relevant time – Plaintiff could enforce his claim against the firm as also its partners – Lender filed application for attachment to protect his interest in the event suit is decreed – Court was to form prima facie opinion at that stage without going into the correctness of the contentions raised – On facts, partners would not be seriously prejudiced on furnishing security, thus, interference under Article 136 not called for – Constitution of India, 1950- Article 136 – Partnership Act, 1932. The appellant-defendant nos. 4 to 7 were partners of the defendant no. 1 firm. Defendant no. 3 was also the partner. It is alleged that defendant no. 2, who was described as the managing partner of the firm fraudulently obtained loan from the plaintiff-respondent and also furnished a personal guarantee. The cheque was issued in the name of defendant No. 1. Defendant no. 3 executed a pronote. Plaintiff-respondent filed suit for realisation of the amount against all the defendants. It also filed application under O. 38 r. 5 CPC for attachment before judgment. The High Court rejected the application since the defendant no. 2 took the loan in connivance with defendant no. 3 and 8 not for the benefit of partnership firm. Aggrieved, plaintiff filed appeal which was allowed. Hence the present appeal. =Dismissing the appeal, the Court HELD: 1.1 The firm would be bound only when a transaction is entered into by a partner of the firm subject to the limitations contained in the Partnership Act, 1932. [Para 9] [213-G] 1.2 The amount of loan was advanced by a cheque. The said cheque was drawn in the name of the partnership firm. Concededly again, the appellants were the partners thereof at the relevant time, although an endeavour was made before the Single Judge of High Court to show that they ceased to be so. Having regard to the fact that they purported to have retired from the partnership firm in the year 2001 and the transaction between the parties are of the year 2000, prima facie the liability of the appellants could not have been ignored. [Para 11] [214-A, B, C] 1.3 The application for attachment before judgment was filed by the plaintiff so as to protect his interest in the event the suit is decreed. In such a situation, the court exercises jurisdiction under Order XXXVIII Rule 5 CPC. It need not go into the correctness or otherwise of all the contentions raised by the parties. Allegations against defendant Nos. 2, 3 and 8 are required to be gone into at the hearing of the suit. The plaintiff is entitled to secure his interest keeping in view the amount involved in the suit. A cheque had been issued in the name of the firm. The appellants are partners thereof. A pronote had been executed by a partner of the firm. Thus, even under the Partnership Act prima facie the plaintiff could enforce his claim not only as against the firm but also as against its partners. [Paras 12, 13 and 14] [214-D, F, G, H; 215-A] 1.4 In any view of the matter as the appellants are not seriously prejudiced if they furnish the security, this, is not a fit case where this Court should exercise its jurisdiction under Article 136 of the Constitution of India. [Para 15] [215-B] K. Ramamurthy, Kawaljit Kochar, Rishi Dewan and Kusum Chaudhary for the Appellants. Amit Sharma and B.V. Anupam Lal Das for the Respondents.

CASE NO.: Appeal (civil) 802 of 2008 PETITIONER: Rajendran and others RESPONDENT: Shankar Sundaram and others DATE OF JUDGMENT: 30/01/2008 BENCH: S.B. SINHA & HARJIT SINGH BEDI JUDGMENT: JUDGMENT (Arising out of SLP (C) No. 22880 of 2004) S.B. SINHA, J. 1. Leave granted. 2. Appellants herein were defendant Nos. 4 to 7 in the … Continue reading

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