ORDER

Substitution allowed.

2. The decision impugned herein is a reversing judgment of the Madras High Court in Appeal No. 180/76, dated April 3, 1980. This appeal by special leave relates to an action which took place between the filing of the suit by the respondent for dissolution and rendition of accounts by the appellant.

3. The admitted position is that one N.A.P. Alagiri Raja, son of Pappu Raja, and Raja Ramalinga Raja, two brothers and the appellant, K.P.A. Vellayappa Nadar a stranger, since dead, admittedly, were partners of "N.A. Pappuraja Sons" started way back in 1943. The partnership agreement was reduced to writing for the first time under Ex. A-2, dated March 31, 1954. Another admitted fact is that on February 15, 1970, another partnership was constituted under Ex. B-1 consisting of the first two partners and their sons, together four, with the same partnership business in the same place and with the same registration number of the partnership firm with the Registrar of the Firms. Raja Ramalinga Raja died on May 31, 1972. Thereon, the respondent laid the suit for dissolution of the partnership firm and for rendition of accounts by the appellant on April 26 , 1973. The case of the appellant is that due to his old age, viz., 70 years as on February 14, 1970, there was mutual agreement by which the appellant had stepped out from the partnership business leaving all assets and liabilities with the two partners. His right to share in the goodwill was mutually agreed to be set-off against liabilities falling within his share. The partnership under Ex. A-2 mutually stood dissolved on February 14, 1970 settling the accounts between the partners. The new partnership came into existence on February 15, 1970 under Ex. B-1. Therefore, there is no liability on his part to render any accounts or to bear any losses incurred by the new partnership firm under Ex. B-1 to which he was not a member on and from February 15, 1970. The trial Court recorded the findings as under:

"The question relating to the goodwill and Vilasam and fixed assets of the business of "Pappuraja and Sons" were discussed. In the end, in view of all these facts, it was agreed (1) that the first plaintiff and his brother should take over the business as a running concern; and (2) that the amounts shown as debits against the defendant should be considered to have been wiped out as having been set out against this defendant s share in the goodwill and in the share of profits really made for the above 2 years. It was on this understanding that the firm was dissolved on 14,2.1970 by consent of all parties concerned. The first plaintiff and his brother and others from their family started their business in the same vilasam with the same R.C. No. and in the same premises from 15.2.1970 in pursuance of the above conclusion. Thus, the firm was dissolved on 14.2.1970 itself with no need whatsoever for taking any account in respect of the dissolved firm in the above circumstances."

4. On the basis of this finding the trial Court came to the conclusion that the partnership firm under Ex. A-2 stood dissolved with the settlement of accounts. The appellant has nothing to do with the business run by the respondent-plaintiffs after Ex. B-1 dated February 15, 1970 was entered into among the respondent-plaintiff and the deceased Raja Ramalinga Raja and other. The trial Court also found thus:

"No document was filed to show whether the defendant along with the plaintiffs signed in the subsequent returns. On an analysis of the entire evidence, it is clear that the old firm was dissolved on 14.2.1970 with the consent of all the partners and the plaintiffs have started a new partnership as mentioned in Ex. B-1 and they are continuing the same business of the old firm."

5. However, no documents were filed to show whether the defendant along with the plaintiffs signed in the subsequent returns. On the analysis of the entire evidence, it is clear that the old firm was dissolved on 14.2.1970