The plaintiffs whose suit failed in the Courts below prefer this second appeal. The plaintiffs and the defendants were doing business in partnership from 7th February, 1944 to 21st January, 1949. The main business transacted by the partnership was procurement and distribution of paddy under the Control Orders which were in force during the major part of that period. The partnership was dissolved in 1949 and accounts of the dissolved partnership were taken. The plaintiffs received their share of the capital and profits and retired from the partnership. The defendants are continuing the business. The firm was never registered.

During the period of the partnership, the Government directed the firm to pay a sum of Rs. 8,323-6-8 as surcharge on the stocks of paddy held by the partnership. The money was paid. Subsequently, businessmen in the position of the plaintiffs and defendants complained to the Government challenging the legality of the Government’s order levying a surcharge. As a result of further consideration, the Government directed a refund of a portion of the surcharge which had been collected from merchants of that class. In pursuance of that direction, the defendan