IN THE HIGH COURT OF KARNATAKA AT BENGALURU
ANU SIVARAMAN, K. MANMADHA RAO, JJ.
M/S. Cheers Garden Paradise Bar And Restaurant, Rep. By Its Managing Partners Mr. G.R. Channakeshava, S/o. Sri. Rangegowda and Ors. – Appellants
Versus
Sri. D. Jayanna, S/o. Late Kenchegowda Major and Anr. – Respondents
Commercial Appeal No.272 of 2022
Decided On : 04-09-2025
| Table of Content |
|---|
| 1. jurisdiction and appeal context. (Para 1 , 2) |
| 2. reliefs sought in the original suit. (Para 3 , 4) |
| 3. background and procedural history of the case. (Para 5 , 6) |
| 4. arguments regarding limitations and partnerships. (Para 7 , 9) |
| 5. court analysis of the evidence and findings. (Para 8 , 10) |
| 6. validity of the partnership and dissolution. (Para 11 , 12 , 13) |
| 7. final dismissal of appeal. (Para 14) |
JUDGMENT :
ANU SIVARAMAN, J.
This Commercial Appeal is filed challenging the judgment and decree dated 09.11.2021 passed by the Commercial Court and II Additional District and Sessions Judge, Mysuru ('Commercial Court' for short) in Commercial O.S.No.103/2020.
2. We have heard Shri. M.C. Jayakirthi, learned counsel appearing for the appellants and Shri. Vighneshwar S. Shastri, learned Senior Counsel as instructed by Ms. Sadhana, learned counsel appearing for respondent No.1.
3. The suit was filed by respondent No.1 seeking the following reliefs:-
"a) Declare that the alleged registered partnership deed dated 26.11.2007 created between the 2nd and 4th defendant is not binding on the above plaintiff as it is void abinitio in nature.
b) Pray for dissolution of first defendant partnership firm which is running under name and style as "CHEERS GARDEN PARADISE BAR AND RESTAURANT" coming into existence as per the partnership deed dated 21.02.2002.
c) Pray for accounts of the firm from the date of commencement of the business till the date of dissolution.
d) And consequential relief of mandatory injunction directing the 1st and 2nd defendant to settle all the capital investments, interests, good wills, profits, etc., as per the partnership deed dated 21.02.2002 till the date of realization.
e) And also pray for consequential relief of permanent injunction restraining the defendant No.1 to 4, their agents, relatives, children, employees, etc., to run the partnership firm in the name and style of "CHEERS GARDEN PARADISE BAR AND RESTAURANT" in future permanently anywhere in India.
f) With cost and such other relief's as this Hon'ble Court deems think fit under the circumstances of this case, in the interest of justice and equity."
4. By the judgment under appeal, the trial Court held as follows:-
"The suit of the Plaintiff is decreed with costs as under:
It is declared that the alleged partnership deed dated 26.11.2007 is not binding on the Plaintiff.
The partnership firm which is running under the name and style 'Cheers Garden Paradise Bar and Restaurant' coming into existence as per partnership deed dated 21.02.2002 is dissolved on the date of presentation of the plaint dated 29.06.2011.
The three partners of the firm i.e., Defendant No.2 G.R. Chennakeshava and Defendant No.3 Mr.K.N. Yashavantha Kumar are having 33.33% share each in the profit and loss of the firm and the plaintiff is having 33.34% share in the profit and loss of the firm as per partnership deed.
The defendant No.2 is directed to furnish the accounts of the firm within four months. In case of failure to furnish the account by the Defendant No.2, the Plaintiff is entitled to take appropriate steps for relief of rendition of accounts and distribution of shares as declared above in the firm as provided under law through process of the Court.
The Defendants No.1 to 4 are permanently restrained from running partnership firm in the name and style of "Cheers Garden Paradise Bar and Restaurant" in future.
The suit against Defendants No.5 to 7 is dismissed.
Draw preliminary decree accordingly.
File be consigned to the record room."
5. The learned counsel appearing for the appellants submits that the judgment and decree were passed without considering the relevant aspects of the matter and are liable to be set aside. It is submitted that the appellants and respondents No.1 and 2 had entered into a partnership to run the business of Bar and Restaurant under the name and style of 'M/s. Cheers Garden Paradise Bar and Restaurant'. Each of the partners had contributed a sum of Rs.3,00,000/- as Capital f
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The partnership deed from 2007 was declared void, maintaining the existence of the original partnership from 2002.
Even if plea of limitation is not set up as a defence, Court has to dismiss suit if it is barred by limitation.
Plaintiff cannot dissolve the partnership at her will and pleasure.
Failure to provide evidence for notification and unauthorized property sales by partners led to the rejection of the dissolution suit; jurisdiction determined by prior judicial orders must be respect....
The central legal point established in the judgment is the requirement of mutual agreement for partnership dissolution and the significance of partnership deeds in determining the intention of the pa....
A suit by a partner for the recovery of share capital invested in a partnership firm is not maintainable as a simple money suit; it must be framed as a suit for dissolution and settlement of partners....
The court held that a partner's possession of dissolved firm property does not create ownership rights against co-owners, and claims of adverse possession are not maintainable.
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