ORDER

R.V.RAVEENDRAN, J.

1. Leave granted Heard For convenience the appellant and respondent will also be referred to by their ranks in the suit, as `plaintiff' and `defendant' respectively.

2. The appellant and respondent entered into a partnership as per deed dated 5.4.2000 to run an Institute for preparing students for competitive examinations, under the name and style of `Takshila Institute', at No.F-19, LSC, Bhera Enclave, Paschim Vihar, New Delhi.

3. On 29.6.2004, the appellant entered into an "agreement to sell" (Bayana Agreement) under which she agreed to sell the property described as follows:

"An undivided half share, second floor (without roof rights) of built up property bearing No.8, Pocket & Block C9, Sector-8, Rohini, Delhi - 110 085, built on a plot of land area measuring 158.98 Sq.m and 50% share of M/s Takshila Institute established in the above said property which is hereby agreed to be sold includes all rights, titles, interests, goodwill, electricity equipment, furniture, fixtures including passages, easements facilities privileges etc., which attached thereto or connected therewith."

Clause 13 of the said agreement clarified that the property agreed to be sold included the goodwill of the firm M/s Takshila Institute, having its office at C-9/8, Sector 8, Rohini, Delhi-85 in which the first party is also the partner of 50% and included all rights, interest, claims, title, fittings, furniture, fixtures and all equipment.

4. Under the said agreement, the total consideration agreed was Rs.21,50,000/- and the appellant received Rs.750,000/- as advance. The appellant claimed that in pursuance of the said agreement, she executed a sale deed in regard to the immovable property for Rs.200,000/- and that the respondent promised to pay the balance of Rs.12 lakhs in regard to the other rights and interest agreed to be sold under agreement of sale dated 29.6.2004. She filed Suit No.16/2006 in the District Court, Delhi for recovery of Rs.12 lakhs under the said agreement dated 29.6.2004, alleging that respondent had paid in all Rs.9.5 lakhs towards the agreed price. The said Suit No.16/2006 was decreed in favour of the appellant on 25.11.2006, directing respondent to pay Rs.12 lakhs with interest at 7% per annum with effect from 30.8.2004.

5. Thereafter the appellant filed another suit - C.S. (O.S.)No.302/2007 - in the Delhi High Court against the respondent, for rendition of accounts for the period 5.4.2000 to 31.7.2004, in regard to the partnership firm of Takshila Institute constituted under deed of partnership dated 5.4.2000. In that suit, the appellant alleged that the said partnership was at will and it was dissolved by implication on 31.7.2004, when respondent filed Suit No. 438/2004 against the appellant (and others) for an injunction. She also sought a decree against the respondent for her share of profits in the said partnership and for a decree for Rs.25.28 lakhs or higher amount in regard to the share of plaintiff with interest thereon. The said suit was resisted by the respondent. Three preliminary grounds of objections were raised in regard to the maintainability of the suit: (a) that the suit was barred by res judicata; (b) that the suit was barred under Section 69 of the Partnership Act, 1932, as it related to an unregistered partnership; and (c) that the suit was liable to be dismissed for material suppression of facts and approaching the court with unclean hands. It was alleged that parties were close relatives and appellant being a government servant, was only a sleeping partner. It was contended that by the agreement of sale dated 29.6.2004, the partnership under deed dated 5.4.2000 was dissolved and all claims of appellant were settled.

6. The issues in the said suit were framed on 17.1.2008 with a direction that the first issue, extracted below, be treated as a preliminary issue: "Whether the suit is barred by the principle of res judicata as issue raised in the Suit has been directly and substanti