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1958 Supreme(Cal) 206

HIGH COURT OF CALCUTTA
P. C. Mallick
SHYAMLAL ROY - Appellant
Versus
MADHUSUDAN ROY - Respondent
Suit 1224  Of  1953
Decided On : AUGUST 01, 1958

Advocates Appeared:
B.C.Dutt, M.M.SEN

A Hindu joint family business with more than 20 members is illegal under Section 4 of the Indian Companies Act.

Headnote:

PARTITION SUIT - Joint Family Business - Partnership - Legality - Hindu Joint Family - Indian Companies Act - Res Judicata - Rice Company - Shares - Decree for Partition.

Fact of the Case:

Suit for partition of six items of immovable properties and certain businesses. Common ancestor of the parties is one Budhuram Saha, who had four sons, Gangasagar, Anandamohan, Harimohan and Brajamohan. It is alleged in the plaint that the four sons of Budhuram carried on family businesses under various names and styles.

Finding of the Court:

1. The businesses were originally joint family businesses and not contractual partnerships. 2. The partnership deeds and registration certificates are contradictory and do not prove the existence of a contractual partnership. 3. The businesses were illegal under Section 4 of the Indian Companies Act as they consisted of more than 20 members. 4. The rice company is not a joint family asset and cannot be divided in the partition proceedings. 5. The shares of the parties as stated in the amended plaint are correct.

Issues: 1. Were the businesses of Gangasagar Anandamohan Saha, Harimohan Brajamohan Saha joint family businesses of the parties or partnership businesses? 2. Were there any business of the names of Gangasagar Saha and Gangasagar Likcnath Saha? It so, were they joint family businesses or partnership businesses? where were the businesses carried on? is any of the said businesses still in existence? 3. Was there any business of the name of Gangasagar Anandamohan Harimohan Brajamohan Saha? Was such business joint family business co-partnership business? 4. Do the properties mentioned in "schedule B" to the plaint belong to the joint family of the parties to the suit? 5. Have the shares of the parties been correctly given in paragraph 7 of the plaint? 6. Is the suit maintainable as framed? 7. Is the suit barred by the Section 11 or principles analogous thereto by reason of the decision in the suit No. 52 of 1946? 8. Is the suit had for non-joinder of parties? 9. To what relief is the plaintiff entitled?

Ratio Decidendi: 1. The onus of proving that the businesses were converted from joint family businesses to contractual partnerships lies on the defendants, which they have failed to discharge. 2. The partnership deeds and registration certificates are contradictory and do not prove the existence of a contractual partnership. 3. The businesses were illegal under Section 4 of the Indian Companies Act as they consisted of more than 20 members. 4. The rice company is not a joint family asset and cannot be divided in the partition proceedings. 5. The shares of the parties as stated in the amended plaint are correct.

Final Decision: Decree for partition of the joint family properties, except the rice mill, in accordance with the shares of the parties as stated in the amended plaint. The general costs of the suit and costs of one day's hearing the parties will themselves bear and the hearing costs beyond one day the defendants will pay to the plaintiff.

P. C. MALLICK, J.

( 1 ) THIS is a suit for partition. Properties sought to be partitioned are six items of immovable properties and certain businesses. Common ancestor of the parties is one Budhuram Saha, who had four sons, Gangasagar, Anandamohan, Harimohan and Brajamohan. It is alleged in the plaint that the four sons of Budhuram carried on family businesses under various names and styles. The shares of the parties arc set out in paragraph 6 of the plaint. It is alleged that the senior managing members of the family are mismanaging and misappropriating joint family funds, have refused the plaintiff access to the books of account, have not furnished information with regard to the joint family businesses, assets and their own dealings. Usual reliefs in a Partition suit have been claimed.

( 2 ) THERE is a number of defendants, more than 30. Out of them, only six have filed written statements. Defendants Nos. 2, 9 and 20 have filed a written statement jointly. Defendants Nos. 8 and 17 have filed another written statement jointly. A third written statement has been filed by defendant No. 9b. There are, therefore, three written statements on record and the defence taken in each one of the written statements is more or less the same.

( 3 ) IT is not denied in the written statement that the parties to the suit are descendants or wives of such descendants of the four brothers--Gangasagar, Anandamohan, Harimohan and Brajamohan or that the four brothers during their life time carried on family business under various names and styles. It is alleged in one of the written statements, viz. , that of defendants Nos. 8 and 17, that the heirs of the four brothers separated about 40 years back, i. e. , in 1913, and have been living ever since in four different houses in four undivided joint families. It is further alleged that businesses are no longer one joint family business but are partnership businesses. Business of Gangasagar Anandamohan Saha was started on 23-3-1933 in co-partnership of four kartas of the said four joint families and four outsiders. From time to time the constitution has changed with the death or retirement of the partners. The present partners are the four kartas of the joint family, namely, Manik Chandra Radharam. Bidu Bhusan and Podaballav and one outsider, Mohini Mohan. So also the business of Harimohan Brajamohan Saha was started on 23-3-1933 in co-partnership by the four kartas with three outside partners. In the same way, the constitution of the firm changed from time to time. The present partners are the. same four kartas and one outsider. Tarak Chandra Saha. The business of Ganga-sagar Anandamohan Harimohan Brajamohan Saha was similarly started on August 28, 1931 in co-partnership with the kartas with no outsider partner. The present partners are the same four kartas as are partners in the other firm. It is pleaded that none of the properties set out in Schedule B to the plaint belongs to the parties. Item No. 7 in Schedule B belongs to the partnership firm of. Gangasagar Anandamohan Saha, while the other items of properties in the said Schedule belong to the partnership firm of Gangasagar Anandamohan Harimohan Brajamohan Saha. It is pleaded that the rice mill referred to in the plaint does not belong to the parties, but is owned by the company of the name of Gangasagar Rice Mills Ltd. All allegations of mismanagement and misappropriation of funds have been denied. Right to inspect the accounts and to obtain information about the dealings in the partnership business has been disputed, on the ground that the plaintiff is not a partner of any of the partnerships. It is pleaded in two of the written statements that the partnerships are illegal, being an association of more than 20 members, having for its object acquisition for gain and not registered under the Indian Companies Act. It is submitted that the suit is not maintainable and should be dismissed.

( 4 ) ON the pleadings, the following issues have been r




















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