Retirement of one partner does not automatically dissolve a partnership firm if the remaining partners continue the firm.

1. - The present revision petition has been filed by the petitioner-judgment-debtor under Section 115 of CPC, challenging the order dated 23.11.2010 passed by the Additional District Judge, Fast Track No.2, Alwar (hereinafter referred to as "the executing court") in execution petition No.3/2004, whereby the executing court has dismissed the application of the petitioner to drop the execution proceedings on account of death of one of the partners of the respondent-firm.

2. In the instant case it appears that the respondent-firm alongwith its partner Shriram had filed the suit against the petitioner-defendant for the recovery of Rs. 3,05,267/- with interest, stating interalia that the plaintiff was a partnership firm registered in the Partnership Act and its partners were Sriniwas and Shriram. The said suit was resisted by the petitioner-defendant. However the trial court decreed the suit, directing the petitioner-defendant to pay a sum of Rs. 1,87,554.60/- with interest @ 12% per annum from 30.08.1995 till payment. Being aggrieved of the said judgment and decree passed by the trial court, the petitioner preferred the first appeal before this Court which is pending for hearing. It is not disputed that in the said first appeal the petitioner had sought for stay of execution proceedings, however the said application was rejected by the Court. Under the circumstances, the respondents-plaintiffs-decree holders filed the execution petition being No.3/2004 before the executing court. In the said execution proceedings, the property of the petitioner was attached and sold by auction sale. The said sale has also been made confirmed by the Court. However, the petitioner submitted an application before the executing court for dropping the proceedings on the ground that one of the partners deceased Shriram had already retired from the firm on 30.09.1999, and therefore the firm had stood dissolved on the date of decree. The executing court rejected the said application of the petitioner vide the impugned order dated 23.11.2010. Hence the petitioner has preferred the petition invoking the revisional jurisdiction under Section 115 of CPC.

3. The learned Senior Counsel Mr. J.P. Goyal, for the petitioner relying on the provisions contained in the Partnership Act more particularly Sections 41 & 42 thereof, submitted that on the retirement of the one of the partners of the partnership firm, i.e. Shriram, the firm had already got dissolved automatically on the date of decree, and therefore the execution proceedings were not maintainable. The counsel has relied upon the judgment of the Apex Court in case of Mohd. Liquiddin & Anr. v. Kamala Devi Misra (Dead) By LRs. & Ors., 2010(1) WLC 189 , in support of his submissions that in absence of any agreement to the contrary, on the death or retirement of one of the partners, the partnership firm is deemed to have dissolved.

4. However, the learned counsel Mr. Mohit Gupta, for the respondent-firm relying upon the certified copies of the partnership deeds, vehemently submitted that though at the time of filing of the suit there were two partners named Sriniwas and Shriram, one another partner named Purushotam Agarwal was made partner of the firm on 06.04.1999, and that after the retirement of Shriram, the other two persons named Sriniwas and Purushotam Agarwal had decided to continue the firm as per the deed executed by and between them. He has also submitted that the executing court considering the documents on record has rightly rejected the application of the petitioner, by the impugned order, which does not call for any interference.

5. In the instant case, it is not disputed that the original suit was filed by the respondent-partnership firm alongwith its partner Shriram, and that the said suit was decreed against the petitioner, whereby the petitioner was directed to pay a sum of Rs. 1,87,554.60/- with interest @ 12% per annum. It is also not disputed that the said decree was challenged by the pe