SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

1974 Supreme(Cal) 90

Calcutta High Court
B. C. MITRA AND S. C. GHOSE, JJ.
Ratan Kumar Poddar - Appellant
Versus
Howrah Motor Co. Pvt. Ltd. - Respondents
A.F.O.O. No. 373 of 1973 ; Suit No. 16 of 1973
Decided On : 29 March 1974

Advocates Appeared:
Dipankar Ghose, for Appellants; A. Mitter and Somenath Chatterji, for Respondents (Company).

A member of a joint Hindu family can make separate acquisition of property for his own benefit and, unless it can be shown that the business grew from joint family property, or that the earnings were blended with joint family estate they remain free and separate.

Headnote:

The court held that the two firms, Modern Chappal Manufacturing Co. and Piki Trading Corporation, were joint family businesses and not separate businesses of the appellants. The court found that there was a prima facie case that the businesses were started with a nucleus of the joint family funds and that the appellants had failed to discharge the onus of proving that the businesses were not joint family businesses.

Fact of the Case:

The company, Howrah Motor Co. Private Ltd., instituted a suit against the appellants and the respondents Nos. 2 to 8 for recovery of its claims mentioned above. In this suit an application was made for an order directing the appellants and the respondents Nos. 2 to 8 to furnish security in Rs. 1,90,000 and in default of such security being furnished the amounts due from Bata Shoe Co. Private Ltd. of Rs. 68,658.33 to Modern Chappal Manufacturing Co., a sum of Rs. 40,000 due from Philips India Ltd. to Piki Trading Corporation and a sum of Rs. 10,000 due from Farinnis also to Piki Trading Corporation Ltd. be attached before judgment.

Finding of the Court:

The court found that there was a prima facie case that the businesses were started with a nucleus of the joint family funds and that the appellants had failed to discharge the onus of proving that the businesses were not joint family businesses.

Issues: The issue before the court was whether the two firms, Modern Chappal Manufacturing Co. and Piki Trading Corporation, were joint family businesses or separate businesses of the appellants.

Ratio Decidendi: The court held that the two firms, Modern Chappal Manufacturing Co. and Piki Trading Corporation, were joint family businesses and not separate businesses of the appellants. The court found that there was a prima facie case that the businesses were started with a nucleus of the joint family funds and that the appellants had failed to discharge the onus of proving that the businesses were not joint family businesses.

Final Decision: The appeal was dismissed with costs. The order under appeal was modified to the extent that the appellants' solicitor was directed to invest the sum of Rs. 90,000 received from Bata Shoe Co. Ltd. and Philips India Ltd. in a nationalised bank in short call deposit for a term not exceeding 6 months at a time, to be renewed from time to time and to hold the said sum together with interest free from lien and subject to further orders of court.

Judgement


B. C. MITRA, J.:- The first respondent Howrah Motor Co. Private Ltd. (hereinafter referred to as the company) is a distributor in the eastern region of India of several well-known concerns manufacturing motor spare-parts and components. According to the company the first and the second appellants and the fourth, fifth, sixth, seventh and eighth respondents constituted a Hindu joint family governed by the Mitakshara School of Hindu Law. The third respondent Prakash Trading Company is, according to the company, a joint family business and in May, 1969, this firm approached the company for facilities of buying motor-parts on credit on a running and continuous account. The companys case is that Champalal Poddar and Gyan Prakash Poddar the fourth and fifth respondents represented to the company that all the Poddar parties to this appeal constituted a Hindu joint family governed by the Mitakshara School of Hindu Law of which Champalal Poddar the fourth respondent was the Karta and that this joint family was carrying on various types of business under several names. A further representation was made according to the company that the several joint family businesses were shown either as a proprietary or as a partnership concern and the members of the joint family were shown as proprietors or partners of the said different business concerns. Particulars of the several businesses alleged to be owned by the joint family have been set out under paragraph 6 of the petition. The three firms with which we are concerned in this appeal are Piki Trading Corporation, Prakash Trading Co. and Modern Chappal Manufacturing Co. The companys case is that representations were also made to it that all the businesses were started and were being run with the funds of the joint family and that Banwarilal Kasera, the third appellant was an employee of the Poddar family and was the benamdar of the joint family in respect of the business of Modern Chappal Manufacturing Co.

2. Relying upon the representations made by the fourth and fifth respondents alleged to have been made on their own behalf as also on behalf of the other members of the joint family, the company delivered various motor spare-parts to the third respondent Prakash Trading Co. between May, 1969 and January, 1971. According to the company after giving credit for all payments made for the goods supplied a sum of Rs. 1,30,989.20 became due and payable to the company on December 30, 1971. A further sum of Rs. 32,000 is claimed to have become due for sales tax by reason of the failure of the third respondent to furnish sales tax declaration forms. There is also a claim for Rs. 26,197.80 on account of interest at 12% per annum.

3. It is contended on behalf of the company that the spare-parts purchased by the joint family in the name of the third respondent have been transferred to other joint family business carried on under different names. The company claims that the assets of all the joint family firms are available to it for realisation of its claim.

4. In January, 1973, the company instituted the suit out of which this appeal arises for recovery of its claims mentioned above. In this suit an application was made for an order directing the appellants and the respondents Nos. 2 to 8 to furnish security in Rs. 1,90,000 and in default of such security being furnished the amounts due from Bata Shoe Co. Private Ltd. of Rs. 68,658.33 to Modern Chappal Manufacturing Co., a sum of Rs. 40,000 due from Philips India Ltd. to Piki Trading Corporation and a sum of Rs. 10,000 due from Farinnis also to Piki Trading Corporation Ltd. be attached before judgment. In this application an order was made by the trial court on September 25, 1973, for furnishing of security on or before December 10, 1973 in the sum of Rs. 1,90,000 to the satisfaction of the Registrar, Original Side and in default of such security being furnished an order for attachment was made of the sum of Rs. 68,000 due from Bata Shoe Co. Ltd.























































Click Here to Read the rest of this document

1
2
3
4
5
6
7
8
9
10
11
Judicial Analysis

AI

SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top