Golden Glue Factory and Others vs M. Haroon Rasheed Sahib

Thanikkachalam, J.—Defendants 1, 3 and 4 are petitioners herein. The plaintiff filed a suit (O.S. No. 1 of 1994) against the defendants for

dissolution of partnership and rendition of accounts. During the pendency of the suit, I.A. No. 1 of 1994 was filed for appointment of a

commissioner, to take inventory. The trial court appointed a Commissioner. It is against that order, the present revision has been filed by

defendants 1, 3 and 4.

According to learned Counsel appearing for the petitioner herein, the trial court was not correct in appointing a Commissioner to take inventory

under Order 26, Rule 9, C.P.C. read with Section 151 thereof. The suit is not maintainable since Clause 15 of the Partnership Deed dated

20.7.1989 specifically stipulates that disputes, it any, between the partners should be referred to arbitration of two persons nominated by majority

of partners, and the arbitration decision is binding on the partners. The intention of the executants of the partnership deed was that the partnership

shall not be dissolved on the happening of a contingency mentioned in the Partnership Act. The allegation that the defendants are manipulating the

accounts and are not permitting the plaintiff to verify the accounts are not correct. It is also not correct to state that the defendants 1,3 and 4 are

removing the account books from the petition premises. The plaintiff had always access to the books of account and allied receipts, vouchers, etc.

The account books were handed over to the auditors for preparing the statements of accounts to be filed for the purpose of Income Tax

Assessment. It was the plaintiff who took away the books of accounts from the premises. The plaintiff cannot take advantage of his own wrong

and ask for appointment of a Commissioner. The plaintiff is now trying to put an end to the partnership business with an ulterior motive and

therefore he came forward with the present suit for dissolution of the firm. Since there is no ground for appointment of a Commissioner to take

inventory, the order passed by the trial court in appointing a Commissioner is liable to be set aside.

On the other hand, learned Counsel appearing for the respondent submitted that the suit was filed for the dissolution of the partnership firm. The

other partners are acting in a group prejudicial to plaintiffs interest in the firm. The accounts books are being taken away from the business

premises and are not made available to the plaintiff. There is no arbitration clause in the partnership deed. In order to safeguard his interest in the

firm, the plaintiff requested the trial court to appoint a commissioner to take inventory of the assets of the firm. Under the provisions of the

Partnership Act, it is always open to the plaintiff to file the present suit for dissolution of the firm. The plaintiff is entitled to ask for appointment of a

Commissioner to take inventory of the assets of the firm. It was therefore submitted that the trial court was correct in appointing a Commissioner to

take inventory of the assets of the firm.

I have heard the rival submissions.

The fact remains that plaintiff filed a suit against defendants for dissolution of partnership firm and rendition of accounts. During the pendency of

the suit, I.A. No. 1 of 1994 was filed for appointment of a Commissioner to take inventory of the assets of the firm. The trial court appointed a

Commissioner to take inventory of the assets of the firm. According to the plaintiff, since the defendants are acting against the interest of the plaintiff

and they are trying to manipulate the accounts of the partnership firm, the suit had been filed for dissolution of the partnership firm. According to

the plaintiff the accounts books of the partnership firm were taken away by the defendants and were made available to the plaintiff for his

inspection. But according to the defendants the plaintiff had always access to the accounts books of the firm. The account books were handed

over to the auditors for preparing the statement of accounts to be filed for the purpose of Income Tax Assessment. It was the plaintiff who took

away the account books from the premises of the firm. The plaintiff cannot take advantage of his own wrong and ask for appointment of a

Commissioner. It is the case of the defendants, that there is a clause in the partnership, according to which, disputes, if any, between the partners,

should be referred to arbitration of two persons nominated by majority of partners, and the arbitration decision is binding on the partners of the

firm.

Defendants also stated that action was taken against the plaintiff and he was removed from the firm. The shares due to the plaintiff would be

settled after accounts are finalised by the auditors. Therefore, it remains to be seen that one of the partners is not satisfied at the manner in which

the business of the firm is conducted by the rest of the partners. The plaintiff who is none of the partners, suspects that the defendants are

manipulating the accounts of the firm so as to defeat the interests of the plaintiff in the partnership firm. Therefore, the suit was filed for dissolution

of partnership firm. It is the case of the defendant that the partnership cannot be dissolved and it should continue even if there is any dispute

between the partners. It is the definite case of the plaintiff that the account books of the firm and other records were taken away by the defendants

so as to enable them to manipulate the accounts. Therefore the plaintiff sought for appointment of a Commissioner to take inventory of the assets of

the firm. No prejudice would be caused to the interests of the defendants if the inventory is taken by the Commissioner appointed by the court.

When the relationship between the partners is not cordial and one of the partners of the firm is suspecting the conduct of the other partners that

they are manipulating the accounts of the firm, the proper course would be to appoint a Commissioner to take inventory of the assets of the

partnership firm. This is what the trial court has done in appointing a Commissioner. The fact that the suit is not maintainable because of the

arbitration clause in the partnership deed and that the partnership firm cannot be dissolved and it should continue even if there is any dispute

between one partner and other partners, are all issues which can be considered at the time of trial of the suit. At present, the plaintiff has made out

a case for appointment of a Commissioner to take inventory of the assets of the firm, since even according to the defendants, the plaintiff was

removed from the partnership firm.

During the course of arguments, reliance was placed on the following decisions, viz. Smt. Dropadi Vs. Bankey Lal and Others, ; Vali

Venkataswami and Others Vs. Gannabathulla Venkataswami, and M.O.H. Uduman and others Vs. M.O.H. Aslum, . I have gone through all these

decisions. Partnership is a contract, and it is evidenced by Partnership Deed entered into between the partners. The interpretation of the deed

would be looked into at the time of trial if any between the partners. In the present case, at present the plaintiff has made out a prima facie case

that the defendants are conducting the business of the firm against the interest of the plaintiff. Therefore, he filed a suit for dissolution of the firm and

rendition of accounts. According to the plaintiff, the defendants are manipulating the accounts by taking away the account books from the business

premises. The decision in each case depends upon its own facts and circumstances. The facts of the present case justifies the appointment of a

Commissioner by the trial court to take an inventory of the assets of the firm. Accordingly, I am not inclined to interfere with the order passed by

the trial court in appointing the Commissioner to take inventory of the assets of the partnership firm.

In the result, the revision is dismissed. No costs.