Judgment

RAMASWAMI, J. : These appeals are brought, by special leave, from the judgment and decree of the Madras High Court dated September 20, 1961 in A. S. Nos. 45 and 202 of 1957.

2. Narandas Morardas Gaziwala and Lakshmi Chand and Co. were two firms of partnership carrying on business in lace and silver thread at Surat in the State of Bombay. They had dealings with another firm at Kumbakonam - Krishna and Company- who acted as their agents for selling their goods in the three districts of Tanjore, Tiruchirapalli and Mathurai in the State of Madras on commission basis. The two partners of Krishna and Co. were Murugesa Chettiar and his wife s sister s husband Gopal Chettiar. It appears that Krishna and Co. was acting as commission agents on behalf of the two firms at Surat from 1944 till 1951 when the partnership of Krishna and Co. became dissolved by mutual agreement between the partners. Murugesa Chettiar, one of the partners of Krishna and Co. took over all the assets and liabilities of the firm on dissolution and the other partner Gopal Chettiar retired from the firm. In respect of the dealings of the two firms at Surat (hereinafter to be referred to as the Surat Firm) with Krishna and Co., the latter became indebted in 1951. On April 1, 1951 Murugesa Chettiar (hereinafter referred to as the plaintiff) executed a promissory note in favour of Narandas Morardas Gaziwala for a sum of Rs. 7,500 the amount ascertained as due and payable by Krishna and Co. in respect of the dealings of that firm with the Surat firm on a settlement of account. It is the case of the plaintiff that on April 1, 1951 the Surat firm constituted Murugesa Chettiar as the sole agent for selling their goods bearing the trade mark "Napoleon" "Vivekananda" and other marks for the three districts for period of 5 years from April 1, 1951 agreeing to pay commission at a flat rate of Rs.2 per mark for all sales effected in those territories either on orders booked by him or not. The case of the plaintiff was that the Surat firm circumvented the terms of this contract of sole agency and privately effected sales through others or direct to customers in those territories. The plaintiff s contention further was that the Surat firm as part of this agreement of sole agency agreed to have its indebtedness under the promissory note adjusted towards the commission that may be earned by him. The plaintiff therefore instituted O. S. No. 87 of 1954 in the District Munsif s Court, Kancheepuram praying for rendition of accounts from April 1, 1951 till the date of the suit in order to ascertain the amount due and payable to him. The Surat firm in its turn instituted O. S. No. 21 of 1954 in the court of Subordinate Judge, Chingleput against the plaintiff seeking to recover the amount due under the promissory note, viz., a sum of Rs. 7,500. By an order of the District Court, Chingleput O. S. No. 87 of 1954 on the file of District Munsif, Kancheepuram was transferred to the file of the Subordinate Judge, Chingleput and taken on his file as O. S. No. 35 of 1955. Both the suits were tried together by consent of parties. On December 12, 1956 the Subordinate Judge held that the plaintiff was constituted as the sole agent on commission basis for the three territories, Tanjore, Tiruchirappalli and Madurai for a period of 5 years as pleaded and proved by him and the Surat firm was liable to render an account of their sales in those territories from April 1, 1951 and accordingly granted a preliminary decree for rendition of accounts. In O. S. No. 21 of 1954 the Subordinate Judge granted a decree for the amount covered by the promissory note but directed that the decretal amount should be adjusted out of the commission that may be found due and payable on taking of accounts in O. S. No. 35 of 1955. The Surat firm preferred an appeal against the decree in O. S. No. 21 of 1954-A. S. No. 45 of 1957. They also preferred an appeal against the decree in O. S. 35 of 1955 to the District Court