Absence of element of agency.

This is an appeal preferred against the decree and judgment of the learned District Judge of Coimbatore, in A.S. No. 391 of 1953, reversing the decree and judgment of the learned District Munsiff, Erode, in O.S. No. 574 of 1951.

On 18th November, 1939, the plaintiffs’ predecessor entered into an agreement with the first defendant styling it as an ‘Indenture of Partnership ‘in the following terms:

“ The indenture is made the 18th day of November, 1939, between K. N. Mohamed Ghouse Sahib of No. 127, Pitt Street, Penang (hereinafter called the first party) of the one part and S. E. Abdul Rahim also of No. 127, Pitt Street, Penang (hereinafter called the second party) of the other part:

Whereas the first and second parties were carrying on from the year 1925 up to the 30th day of September, 1939, the business of cattle dealers and skin merchants:

And whereas from the 30th day of September, 1939, the said partnership was dissolved by mutual consent on the understanding that the parties hereto shall each carry on a new business of cattle dealers and skin merchants under the style of N.K. Mohamed Ghouse Sahib alternately for a period of two years each at a time at the risk of the party so carrying on and whereas pursuant to the said understanding the second party has been carrying on the said business as from the 1st day of October, 1939, by himself and at his own risk:

Now this indenture witnessed that it is hereby mutually agreed that the” said parties shall become partners in the said business upon the terms hereinafter contained, viz.,

1. The partnership business shall be that of cattle traders and skin merchants and shall be carried on under the style or firm name of ‘N.K. Mohamed Ghouse Sahib’ at No. 127, Pitt Street, Penang, or at such other places in the Colony of the Straits Settlements as may be mutually decided upon.

2. The capital of the partnership shall consist of the following:

“(a) The net value of the stock-in-trade, book debts and other assets (including the goodwill) as on the 30th day of September, 1939, of the business of ‘N. K. Mohamed Ghouse Sahib ‘carried on by the parties hereto at No. 127, Pitt Street, Penang, aforesaid, less the outstanding liabilities of the said business on that date. The said assets less the said outstanding liabilities of the said business shall be credited to the said parties as their respective shares in equal shares. But this shall be subject to re-adjustment in the event of the said liabilities ultimately proving to be more or less than what they are at present in the books.

(b) Any further sums which either party shall from time to time contribute for capital purposes which shall be credited to his capital account.”

3. The duration of the partnership shall be from the 1st of October, 1939, until dissolution by mutual consent.

4. The management of the partnership business shall be in the hands of the second party for a period of two years from the 1st of October, 1939, and shall be; in the hands of the first party for a period of two years from the 1st of October,. 1941, and so on, the ‘parties shall respectively manage the said business for alternate periods of two years at a time. The partner who is at any time managing the business shall hereinafter be called ‘the partner-in-management’.

5. The net amount of capital and monies (other than monies, if any, credited for goodwill) credited to the said first party on the said 1st day of October, 1939,. shall be paid by the second party to the first party on demand and the said second party shall for a period of two years from the 1st day of October, 1939, be the partner in management. Any partner in management shall have the sole and exclusive management of the partnership business and shall devote his whole-time and attention thereto and carry on and manage the same in a prudent and business like manner to the utmost of his skill and ability.

6. A partner-in-management shall during the period of his management be solely entitled to th