1985 Supreme(Ker) 158
Judges : BALAKRISHNA MENON,SUKUMARAN
PONNAMMA - Appellant
Versus
KAMALESWARAN - Respondent
Case No : A.S. No. 189 of 1979
Decided On : 06/25/1985
Advocates Appeared :
C. K. Sivasankara Panicker; For Appellants T.S. Venkiteswara Iyer; P. Gopalakrishnan Nair; For Respondents
The main legal point established in the judgment is the requirement for clear and concrete evidence to establish the existence of a partnership arrangement, especially in cases involving substantial business ventures.
Headnote:
Partnership - Dissolution of Partnership - Evidence of Partnership - Partnership Agreement - Proof of Partnership - Existence of Partnership
Fact of the Case:
The plaintiff, the eldest son, filed a suit for dissolution of partnership and rendition of accounts against the 1st defendant, his father. The plaintiff claimed that there was a partnership agreement between him and the 1st defendant for the execution of major works under the Electricity Board. The 1st defendant denied the existence of a partnership and repudiated the plaintiff's claim.
Finding of the Court:
The court found that the evidence presented by the plaintiff, including letters and account books, was unreliable and insufficient to establish the existence of a partnership between the plaintiff and the 1st defendant. The court also noted that the conduct of the plaintiff, including his admission in an affidavit before an arbitrator, was inconsistent with the claim of a partnership.
Issues: The central question was whether there was a partnership between the plaintiff and the 1st defendant, and if so, the material terms thereof. The subsidiary contention was whether the defendants had any effective opportunity to adduce evidence to dislodge the inference of partnership.
Ratio Decidendi: The court emphasized the importance of an agreement between the parties and the evidence relating to its essential terms before a plea of partnership could be sustained. The court also highlighted the need for clear and concrete evidence to establish a partnership arrangement, especially in cases involving substantial business ventures.
Final Decision: The court held that the evidence presented by the plaintiff was unreliable and insufficient to establish the existence of a partnership between the plaintiff and the 1st defendant. The suit was dismissed, and the appellants were awarded costs.
1. A suit for dissolution of partnership and rendition of accounts was decreed by the court below. The dis-satisfied defendants-defendants 2, 3, 6 and 7 have filed the appeal challenging the decree. (The only defendant in the suit had passed away during the pendency of the suit. The 2nd defendant is his widow, and defendants 3 to 7 are the children. Defendants 4 and 5 have been made respondents in the appeal).
2. The following are the skeletel facts relevant for the appeal.
3. Narayanan Chellappan 'Chellappan contractor' as he appeared to have been familiarly known had small beginnings in his life. He did not have much of formal education. That, however, was one inhibiting factor for his business success. He undertook the execution of many works under the Government, and the authorities like the Electricity Board. Sometimes he did the business by himself. Sometimes in
collaboration with others. Jayapalan, his brother-in-law (wife's brother) examined in the case as P.W.3, was also in similar line but with less success. Chellappan had a partnership with him. That was way back in 1948. (See Ext. B5 partnership deed). That came to an end on 6-6-1950 when the dissolution of that firm was notified in the Gazette (Ext. B7). There was yet another firm, Kairali Corporation in which Chellappan was a partner. That firm had about seven partners. That too was later discontinued.
4. In the 1960's, Chellappan took up major works under the Electricity Board; some at Kuttiyadi; and some at Sabarigiri in Idukki. The execution of these works was not without their exasperating experiences. The Kuttiyadi work conduction of tract cutting and forming penstock route, construction of 130' high main dam and construction of causeway etc. was taken up in 1963. The work was somewhat finished by the end of December 1971. That was, however, not the end of the story. He had grievances about the inadequate payment made by the Board for the work. The dispute was sought to be resolved by resort to arbitration. The arbitration proceedings started in 1973. The litigative fight did not stop till it reached the highest court in the country. The Supreme Court finally disposed of the case between the contractor and the Board on 21-11-1974. (See Ext. B4 order in Civil Appeal No. 682 of 1974). He then received the money in terms of the final decision. His outstanding liabilities and accounts appear to have been settled on that occasion. He thought of distributing, possibly a portion of the surplus, among his own children. All the sons got Rs. 40,000/ each except the youngest who got an added sum of Rs. 10,000/ . Chellappan would have hoped for happiness, by that gesture and by that time. His hopes were dashed. A seed of discord had been planted, deep in the plaintiff's mind. The plaintiff sent a suit notice on 23-2-1976. (Ext. A13 is the postal receipt and Ext. 14 the acknowledgement slip.) The reply to it from Chellappan's lawyer is dated 7-3-1976 Ext.A15.) The seed of discord sprouted by this time. The suit was instituted on 8-7-1976.
5. The plaintiff, the eldest son, had his studies up to the Pre-Uniyersity level. The second son, the 3rd defendant is an Engineering graduate. Though he had occupied a berth in the Government Service, he left it off in search of fresh fields and pastures new, no doubt expecting encouragement and guidance from his own father. Another son, 4th defendant is a doctor. Two medical men had married his two daughters, Mangalam and Maheswari, defendants 5 and 6. The youngest son, Kaladharan, the 7th defendant, was also assisting his father in his works.
6. The plaintiff was not satisfied by filing a suit for the vindication of his assumed rights. He filed also a petition for attachment before judgment, virtually disabling his father from receiving money due for the works he had carried out in the Civil Aerodrome at Trivandrum. This harsh, if not heartless, step pained him. The father filed an affidavit in opposition to that application o