IN THE HIGH COURT OF ALLAHABAD
Agarwala, J.
BHOLA NATH - Appellant
Versus
KASO DEVI - Respondents
Ex. First Appeal 42 Of 1945
Decided On : 12/08/1950
PARTNERSHIP - PROPERTY - RIGHTS OF PARTNERS - SHARE OF PARTNER - TRANSFER OF SHARE - RIGHTS OF TRANSFEREE - CHARGE ON SHARE - SUBSISTENCE AGAINST PROPERTY PURCHASED BY BONA FIDE PURCHASER - NO.
Fact of the Case:
A partnership firm, Krishna and Co., was dissolved and its assets were sold to Bhola Nath. One of the partners, Ram Chander, had a judgment debt against him in favor of Mt. Kaso Devi. Mt. Kaso Devi sought to execute the decree against the assets of the partnership firm in the hands of Bhola Nath, claiming that the charge created by the decree subsisted against the property.
Finding of the Court:
The court held that the charge created upon the share of the judgment-debtors, Ram Chander and others, in the assets of the partnership firm did not subsist against the property purchased by Bhola Nath.
Issues: Whether the charge created upon the share of the judgment-debtors, Ram Chander and others, in the assets of the partnership firm subsisted against the property purchased by Bhola Nath.
Ratio Decidendi: The court reasoned that a partner does not have a right to partition in specie, but is entitled to have the partnership property sold and the proceeds divided. A transferee of a partner's share is only entitled to receive the share of profits during the continuance of the partnership and the share of the assets after dissolution. The property in the hands of Bhola Nath, therefore, was not subject to the charge created by the decree in favor of Mt. Kaso Devi.
Final Decision: The court allowed the appeal, set aside the order of the lower court, and allowed the objection of Bhola Nath with costs throughout.
( 1 ) THIS appeal arises out of execution proceedings. One Debi Das had six sons, Shyam Sunder das, Gauri Shanker, Ram Chander, Balkrishna, Mohan Lal and Ram Kishan. Ram Kishen died leaving a widow Mt. Kaso Devi- respt. She sued her husbands brothers and obtained a decree, on 9-1-30 for future maintenance under which a charge was created upon certain family properties including a l/6th share in a partnership firm known as Krishna and Co. carrying on its business at banaras city. Gauri Shankers share was later on acquired by Mohan Lal, the 5th brother, and in this way Shay am Sunder Das, Ram Chander and Balkrishna were partners in the partnership firm of l/5th each out of l/6th share and Mohan Lals share was 2/5th out of l/6th share.
( 2 ) IN 1935 Sita Ram, one of the patnrs. of Krishna and Co. , filed a suit for the dissolution of the partnership and for accounts. To this suit all the other patnrs. including Shyam Sunder Das, Gauri shanker, Ram Chander, Balkrishna and Mohan Lal were parties. On 2-9-36 a preliminary decree was passed directing the dissolution of partnership, and the appointment of a receiver for taking accounts and realising partnership assets by sale of the partnership property. On 16-5-37 the receiver sold the assets of the partnership, including immovable properties, to one Bhola Nath for Rs. 33,200/ -. On 26-8-37 Mt. Kaso Devi applied to the Civil Judge in the partnership suit praying that, out of the sale proceeds of the partnership assets and the profits payable to her judgment debtors, namely, Shyam Sunder, Ram Chander, Mohani Lal and Balkrishna (Gauri shanker having transferred his share to Mohan Lal went out of the picture), the amount due to her for future maintenance may be paid to her and that the charge for her maintenance may be declared to be fastened to the amount in deposit in Ct to the extent of the shares of her judgment-debtors. This very reasonable appln. was, however, dismissed by the Ct. On 27-8 37 a final decree was prepare i defining the amounts payable to the various patnrs. out of the assets in the hands of the Ct.
( 3 ) ON 8 2-38 Ram Chander, one of the judgment-debtors, under Mt Kaso Devis decree, filed suit no. 72 of 1938 against Mohan Lal, Balkrishna, Shavm Sunder and Mt. Kaso Devi claiming the relief that the sale proceeds be-not paid to Mohan Lal, Balkrishna and Shyam Sunder till Mst. Kaso Devis charge had been satisfied. The relief claimed in this suit was also eminently reasonable. But Mst. Kaso Devi took up the plea that Shyam Sunder, Mohan Lal and Balkrishna were willing to pay-the amount due to her, that Bam Chander alone was not willing to do so and that, therefore, he was not entitled to maintain the suit. Bam Chander, therefore, did not prosecute the suit which was dismissed for default on 31-3-38.
( 4 ) ON 12 10-43 Mb. Kaso Devi put in an. execution appln. for the execution of her own decree as against the original judgment-debtors and also against Bhola Nath, the purchaser of the partnership assets. By means of this execution appln. Mat. Kaso Devi prayed that a sum of Es. 315 due to her for 35 years, from 1-11-40 to 1-10-43, at the rate of Rs. 9/- per mensem, be realised by sale of the l/5th share of Ram Chander and 2/5th share o Mohan Lal and his sons out of l/6th share of the partnership assets which belonged to the family in the hands of Bhola Nath. Her case was that the property purchased by Bhola Nath was subject to the charge created by the decree in her favour and that she could pursue the charge against the property in the hands of Bhola Nath. Bhola nath objected to the execution of the decree as against the assets in his hands on the ground inter alia that he was a bona fide purchaser for value of the partnership assets that the charge, if any, did not subsist upon the assets purchased by him but fastened upon the sale proceeds. There were other objections also with which we are not concerned in this appeal. The Ct. below held that the charge sub
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