Determination of existence of partnership.

Mishra, J.

The first defendant in a suit on the Original Side of the court has appealed against an order of injunction issued in terms as follows:

"That the interim order of the court herein dated 16. 1991 directing the respondents herein not to encumber or alienate the property more fully set out in the schedule hereto, in any manner to third parties and extended till 26. 1991 by order dated 20.6.1991 be and is hereby made absolute till the disposal of the above suit C.S.No.597 of 1991."

2. The plaintiff/first respondent and the second defendant/second respondent have a common cause in the injunction petition. For the purpose of appreciating the nature of the dispute between the parties, we may refer to the contents of the plaint and if necessary to the affidavits filed in the course of the hearing of the injunction petition. We do not, however, have the advantage of the written statement of the first defendant/appellant. We shall, however, for the purpose of deciding, the question of injunction, accept the allegations in the supporting affidavit as uncontroverted.

3. According to the plaintiff, he and defendants 1 and 2 have been dealing in real estate within and outside the jurisdiction of this Court independently and/or in partnership with one another in respect of any particular transaction. They purchased land, developed it as an approved lay-out and sell the lay-out plots to third parties and share not profits arising out of those transactions, depending upon the agreed share of investment and the share of profit fixed therefor. It is said, in the course of such business activity, the first defendant/appellant approached the plaintiff and the second defendant to do business in partnership of developing and selling the land of an extent of 4 acres of approved lay-out. This land is fully described in the schedule to the plaint. It is alleged,

"The first defendant agreed to give to the plaintiff and the 2nd defendant 1/5 share each in the profits of the sale proceeds of the suit property as lay-out plots. The 1st defendant is entitled to 3/5 share in the said profits. The abovesaid business of partnership between the plaintiff and the 1st defendant on the one hand and the 1st defendant and second defendant on the other hand, is confirmed by the 1st defendant in separate agreements dated 14. 1988 and 8. 1988. The partnership business of the plaintiff and defendants came into existence in the following way: The plaintiff states that the 1st defendant represented that the suit property was originally the trust property of Sithi Puthi Vinayakar Temple of Navanerikuppam Village and the 1st defendant along with one Radhakrishnan entered into an agreement of sale dated 110. 1983 with the Trustees of the said temple fixing the sale price of the suit property at Rs.4,93,500 and that the Trustees filed O.P.No.14 of 1985 on the file of the District Court, Chingleput for getting permission to sell the suit property and that the court has also granted permission on 30.7.1985 and that subsequently dispute arose between them and that therefore the 1st defendant and the said Radhakrishnan were not able to purchase the suit property. The plaintiff states that by making such representation during the pendency of the aforesaid O.P.No.14 of 1985 the 1st defendant approached the plaintiff to do business in partnership for developing the suit property as a lay-out and to share the profit by selling the same. The 1st defendant requested the plaintiff for contribution of part of sale consideration to purchase the suit property from the trustees of the temple agreeing to pay 1/5 of the profits of sale of layout plots. Believing the said representation of the 1st defendant, the plaintiff paid a sum of Rs.1,00,000 (one lakh only) on 29. 1987 for purchase of the suit property and the 1st defendant also issued a stamped receipt therefor. In the said receipt itself the 1st defendant admitted to give 1/5 share of profits to the plaintiff.