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1970 Supreme(J&K) 36

IN THE HIGH COURT OF JAMMU AND KASHMIR AT JAMMU
S. Murtaza Fazl Ali,Janki Nath Bhat,Jaswant Singh, JJ.
Sheikh Gh. Ahmad - Appellant
Versus
Sheikh Mohd. Iqbal & Ors. - Respondent
Civil Revision No. 82/1962
Decided On : 01 May, 1970

Advocates Appeared:
Advocate For Appellant: I.K. Kotwal
Advocate For Respondent: D.D. Thakur

A partnership agreement involving the transfer of a permit without the permission of the transport authorities is illegal and cannot be enforced.

Headnote:

MOTOR VEHICLES ACT - SECTION 59 - TRANSFER OF PERMIT - PARTNERSHIP DEED - ILLEGALITY - SUIT FOR DISSOLUTION OF PARTNERSHIP AND RENDITION OF ACCOUNTS - MAINTAINABILITY.

Fact of the Case:

Plaintiffs and defendant entered into a partnership agreement for a truck and its route permit. The partnership deed stated that the defendant would transfer the ownership of the truck and permit to the plaintiffs. The defendant failed to obtain permission from the transport authorities for the transfer of the permit. The plaintiffs filed a suit for dissolution of partnership and rendition of accounts.

Finding of the Court:

The court held that the partnership was illegal as it violated section 59 of the Motor Vehicles Act, which prohibits the transfer of a permit without the permission of the transport authority. The court further held that the suit for dissolution of partnership and rendition of accounts was not maintainable.

Issues: Whether the partnership agreement was illegal due to the transfer of the permit without permission from the transport authorities.

Ratio Decidendi: Section 59 of the Motor Vehicles Act prohibits the transfer of a permit without the permission of the transport authority. The partnership agreement in this case involved the transfer of a permit without such permission, making the partnership illegal. As a result, the suit for dissolution of partnership and rendition of accounts was not maintainable.

Final Decision: The court allowed the revision petition and set aside the order of the Sub-Judge, Ramban. However, the parties were left to bear their own costs throughout.

1. This revision application is directed against the order of the Sub-Judge, Ramban, dated 10th November, 1969. The facts giving rise to this application are as under: -

2. A suit for dissolution of partnership and rendition of accounts was instituted by the plaintiff-respondents against the defendant-petitioner in the Court of the Sub-Judge, Ramban, on the following facts: that the plaintiffs and the defendant by means of a partnership deed dated 3rd January, 1969 registered by the Sub-Registrar, Ramban on the same date, became part­ners in a truck No. JKA-6591, Model 1962, in equal shares; that the plaintiffs had invested Rs. 14,000 as their share of the busi­ness; but the truck was being driven by the defendant and he had to render accounts towards the plaintiff No. 1 but as no accounts were rendered by the defendant, a suit for dissolution of partnership and rendition of accounts was instituted.

3. We need not go into the pleas taken on the merits of the case by the defendant but as an additional plea, it was asserted by him that a route permit could not be transferred in favour of anybody and in the partnership deed the route permit also was transferred, therefore the partnership deed was illegal and the suit of the plaintiffs was not as such maintainable. Issues were struck in this case on 4th August, 1969 and issue No. 2 ran in the following words: -

"Whether under law, no person can transfer a route permit to another person and since there is no mention of transfer of route permit in the partnership between the parties, the partnership-deed is against law and what is its effect upon the present suit O.P.D."

After hearing arguments, the learned trial Judge by his order under revision relying on a Madhya Pradesh ruling reported as AIR 1966 MP 13, held that this partnership was not hit by any provisions of the Motor Vehicles Act and decided the issue against the defendant. It is against this order of the learned trial Judge holding that the suit is maintainable that this revi­sion petition has been preferred in this Court.

4. The revision petition came up for hearing before His Lordship, Honble Chief Justice who by his order dated 9th March, 1970 referred it to a Full Bench. We have heard the learned counsel for the parties at length. In order to understand the argument advanced on the legal proposition by the learned counsel for the parties, it is necessary to reproduce the relevant clause from the partnership deed. The relevant clause translat­ed, reads as under: -

"Truck No. JKA-6591 model 1962, Jammu-Srinagar route, is the property (material of the truck as well as the route permit) of the executant No. 1 i.e. defendant.) Executant No. 1 has now made executant Nos. 2, 3 and 4 (i. e. plain­tiffs) as partners of this truck. Henceforth executant No. 1 will be the owner of the material of the truck as well as its route permit to the extent of one-third, and executant No. 2 to the extent of one-third, executant No. 3 and 4 also to the extent of one-third. The valua­tion of the truck along with route permit has been fixed at Rs. 21,000 and executant No. 2 will pay Rs. 7,000 and executants Nos. 3 and 4 will also pay a sum of Rs. 7,000 to the executant No. 1 before the Sub-Registrar Ramban. From 1st January, 1969 the earnings of the truck and its expenses and profit and loss will be borne by executants 1 to 4 according to the shares mentioned above..."

5. From the above it is clear that the route permit of this truck as well as the material of the truck was the property of the executant No. 1 i.e. the defendant-petitioner. He has transferred the truck itself as well as its route permit (Jammu-Sri­nagar route) to the plaintiffs. It is argued on behalf of the petitioner that under section 42 of the Motor Vehicles Act no owner of a transport vehicle shall use or permit the use of the vehicle in any public place, save in accordance with the condi­tions of a permit granted or countersigned by a Regional or State Transport Authority

























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