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2018 Supreme(Ker) 181

IN THE HIGH COURT OF KERALA AT ERNAKULAM
A.M.SHAFFIQUE, P.SOMARAJAN, JJ.
HEATHER LUIZ, W/O GILROY - APPELLANT
Vs.
NIRENE DENNIS LUIZ - RESPONDENT
RFA No. 568 of 2004
Decided On : 04-04-2018

Advocates Appeared:
For the Appellant : SRI.S.SREEKUMAR (SR), SRI.P.K.SOYUZ, SRI.MARTIN JOSE
For the Respondent: SRI.MURALI PURUSHOTHAMAN, SRI.P.M.BENZIR, SRI.DEEPU LAL MOHAN, SRI.TOM JOSE, SMT.GEETHA JOB(OZHUKAYIL), SRI.M.R.RAJESH

Headnote:

The Partnership Act, Section 48 ;; The Registration Act, 1908- S.17(1) - There is no rule that whatever is brought by a partner in the partnership and is continued to be used by the members is presumed to have become the property of the partnership-Unless there is an agreement that the property which is used for the business of partnership is to become property of the partnership, either by an express or implied agreement, the property cannot be treated as the property of partnership-a particular property is used for the business of the firm, despite the fact that it belongs to any of the partner or partners of the firm, one cannot presume that the property had been taken on stock as the firm's property unless there is evidence to prove the said fact-

Statement of facts:

The second defendant in a suit for partition of the plaint schedule properties has preferred this appeal challenging the preliminary decree passed by the Court below as per judgment dated 13/1/2004 in OS No.652/95. The subject matter in issue in the appeal is only with reference to item Nos. 1 and 2 of plaint A schedule property

Finding of the court:

When a partnership is running business and a property either movable or immovable is taken into the stock of the firm, it has to be borne out from the balance sheet and profit and loss account of the firm, which are audited from time to time. In other words, at least the books of account of the firm should disclose that the immovable property had been taken on stock as firm's property.

Result: Appeal is dismissed.

JUDGMENT :

Shaffique, J.

The second defendant in a suit for partition of the plaint schedule properties has preferred this appeal challenging the preliminary decree passed by the Court below as per judgment dated 13/1/2004 in OS No.652/95. The subject matter in issue in the appeal is only with reference to item Nos. 1 and 2 of plaint A schedule property.

2. The property was originally purchased by Smt. Dorris Luiz as per Ext.A1 registered sale deed dated 3/8/1962. She died on 14/7/1973 leaving behind her husband S.P.Luiz and five children. S.P.Luiz expired on 25/5/1976. Their first son, Dennis Luiz died on 8/4/1992. Plaintiffs are the legal heirs of Dennis Luiz. The first defendant in the suit is the second son of S.P.Luiz and Dorris Luiz. Defendants 2 and 3 are the daughters. The first defendant died during the pendency of the suit and accordingly, his wife and children were impleaded as additional defendants 4 to 10. 11th defendant who is impleaded subsequently is another daughter of the couple. The plaintiffs claimed 1/4th share in the property being the legal heirs of the deceased who had on their death became the co-owners of the property.

3. The defendant filed a written statement inter alia contending that the plaint A schedule property belonged to M/s Southern College of Engineering and Technology, a partnership firm registered under the Indian Partnership Act. Since the plaintiffs and other defendants are not partners of the firm, they have no right in the management of the College or its assets. It is further contended that by virtue of a family arrangement, certain items of properties at Broadway, Ernakulam was set apart to the share of the 3rd defendant and the Kalamassery property has been allotted to the second defendant. Reference is also made to a suit filed by defendants 2 and 3 as OS No.65/2000 seeking to restrain the legal heirs of Edward Luiz from interfering with the administration of the College. It is submitted that the suit was decreed by virtue of a compromise which has become final.

4. The Court below having considered the respective contentions framed an issue as to whether the plaint schedule properties were to be partitioned.

5. The main contention raised by the contesting defendants was that A schedule property is the property of a partnership firm. Court below after evaluating the evidence tendered by the plaintiff and defendants decreed the suit and a preliminary decree had been passed allowing plaintiffs to recover separate possession of 1/4th share from the plaint schedule properties after its partition in metes and bounds and also the mesne profits.

6. Sri.S.Sreekumar, learned senior counsel appearing for the appellant contended that Smt. Dorris was running an institute under the name and style “Southern College of Engineering and Technology” originally at Thevara. The said property was acquired by the Government and therefore, she purchased another item of property as per Ext.A1 sale deed and the institute was shifted to that place. Until her death, she was managing the affairs of the institute, and after her death, by her husband S.P.Luiz. After the death of S.P.Luiz, parties entered into a partnership and Ext.B9 dated 22/6/1976 is the partnership deed. It is argued that since the constitution of the partnership, the firm was running the Institute and late Sri.Dennis and defendants 1 and 2 were partners. The 3rd defendant who was a minor was admitted to the benefits of the partnership. It is submitted that all along the institute was being conducted in the plaint A schedule property and it has been treated as the property of the firm. In that view of the matter, Court below was not justified in granting a decree as sought for.

7. Learned counsel also placed reliance upon the following judgments of the Apex Court :-

(i) Addanki Narayanappa v. Bhaskara Krishnappa (AIR 1966 SC 1300).

(ii) Commissioner of Income Tax v. Juggilal Kamalapat (AIR 1967 SC 401).

(iii) Sunil Siddharthbhai v. Commissioner of Inco











































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