Baldev Singh vs Smt. Sukhdev Kaur

V.K. Jhanji, J.—Appellant, Baldav Singh filed a suit for "dissolution of partnership and rendition of accounts" against Smt. Sukhdev Kaur, respondent alleging, therein that plaintiff and the defendant are partners in truck No. PUR-3347 in which, the plaintiff has got 1/4th share and the remaining 3/4th share is that of the defendant. It was also alleged that actual business is being carried on by the defendant who for quite some time has refused to render the accounts with respect to this truck.

The defendant contested the suit and besides other pleas, also took a preliminary objection that the suit was not maintainable in the present form.

The trial Judge framed the preliminary issue to the following effect :--

"Whether the suit is maintainable in the present form ?" The trial Judge deeided the said preliminary issue against the appellant after holding that the suit for rendition of accounts of an unregistered firm can lie only if the firm had been dissolved prior to the filing of the suit and that if the firm was undissolved on the date of filing of the suit, the only relief that could be granted in the suit was dissolution of the firm. The judgment and decree of the trial Judge is being impugned in the present appeal.

The only question which was raised before the Judge on behalf of the defendant and which arises for consideration here as well is whether the suit is barred u/s 69 of the Indian Partnership Act, 1932 (briefly ''the Act''). Subsections (1) and (2) of Section 69 of the Act have created a bar on certain classes of suits relating to an unregistered firm Subsection (3) of Section 69 of the Act provides an exception, relevant part of which is as follows :--

"69 (3):--The provisions of Sub-sections (1) and (2) shall apply also to a claim of set-off or other proceedings to enforce a right arising from a contract, but shall not effect --

(a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or

(b) xxx xxx xxx".

Rule 15 of Order 20, Code of Civil Procedure, contemplates the passing of a preliminary decree in suit for dissolution of partnership so as to enable the Court to pass a final adjudication of specific rights of the parties. A combined reading of Sub-section (3) of the Section 69 of the Act and Rule 15 of Order 20 of the Code of Civil Procedure, makes it clear that relief by way of dissolution of firm also includes the relief of taking rendition of accounts between the partners. This precise question was dealt with by the Lahore High Court in Jhandu Mal v. Rulia Ram A. I. R. 1937 Lah. 633, wherein it was held that :--

"A prayer for ''dissolution of partnership'' through Court is accompendious mode of asking a fourfold relief :

(a) a declaration that the partnership stands dissolved from a certain date, (b) a declaration as to who the partners are and what are their proportionate shares; (c) a prayer that accounts be taken and the assets and liabilities of the partnership as on the date of dissolution be determined, and (d) a final decree be passed. It is obvious that a decree for dissolution simpliciter will not yield any tangible results. In order to be of some practical use to the pratners, it must be followed by certain consequential reliefs, leading up to a final decree. These prayers are implicit in the prayer for dissolution made in a ''suit for dissolution of partnership."

In this view of the matter, the finding of the trial Judge on issue No. 1 cannot be sustained and therefore, the same is hereby set aside.

Consequently, the appeal is allowed and the case is remanded to the Sub Judge 1st Class, Kharar, who shall decide the suit on merits after framing issues on the basis of pleadings of the parties.