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CASE NO.:
Appeal (civil) 7318 of 2000
PETITIONER:
Gannmani Anasuya & Ors
RESPONDENT:
Parvatini Amarendra Chowdhary & Ors
DATE OF JUDGMENT: 17/05/2007
BENCH:
S.B. Sinha & Markandey Katju
JUDGMENT:
J U D G M E N T
S.B. SINHA , J :
1. This appeal is directed against a judgment and decree dated
29.10.1999 passed by a Division Bench of the High Court of Judicature at
Andhra Pradesh at Hyderabad whereby and whereunder an appeal preferred
by Appellants herein, who were Defendant Nos. 2, 3 and 5 to 7 in the suit,
from a judgment and decree dated 23.04.1993 in O.S. No. 55 of 1985 passed
by the Subordinate Judge, Ramchandrapuram, was dismissed.
2. Plaintiffs (Respondent Nos. 1 and 2 herein) filed a suit purported to be
one for partition claiming 2/3rd share in the property described in Schedule
’A’ appended to the plaint, claiming 4/9th share in the property described in
Schedule ’B’ appended thereto, as also for a decree directing the Defendants
1 to 3 to render fair and proper accounts in respect of the poultry business
which was being run in the Schedule ’B’ property from the year 1968
onwards as also for future profits thereupon.
3. Plaintiffs are sons of Defendant No.1 (Respondent No.3 herein). One
Narasimha Murthy was the father of Defendant No.1. Appellants herein
admittedly are related to the respondents. Appellant No. 1 is niece of late
Narasimha Murthy. Her parents died when she was very young and
unmarried. She was brought up by the said Narasimha Murthy and married
to Appellant No.2 herein. Appellant Nos. 1 and 2 allegedly were close to the
said Narasimha Murthy. At the time of marriage, Appellant No. 2 was a
student of Veterinary Science at Madras. After securing B.V. Sc. Degree, he
got an appointment in the veterinary department and later on became a
B.D.O., and subsequently a Project Officer in the Urban Community
Development of the Hyderabad Municipal Corporation. They allegedly
approached Defendant No. 1 and late Narasimha Murthy to invest money in
poultry business at Hyderabad; pursuant whereto investments were made.
Allegedly, an arrangement was entered into by and between the parties that
profits of the said business can be shared by late Narasimha Murthy, on the
one hand, and Defendant No. 1 and Defendant No.2, on the other, equally
after giving due credit to the expenditure and interest to investments made @
15% p.a. 7 acres and 14 guntas of land was purchased with the moneys
advanced by late Narasimha Murthy and Defendant No.1 at Attapur near
Hyderabad in the name of late Narasimha Murthy and the Defendant No.2.
Poultry business was, thus, started.
4. Narasimha Murthy died in the year 1971. With the profits from the
said business going up, a tube manufacturing plant was also installed.
According to the plaintiffs on the death of the said Narasimha Murthy, they
inherited 2/3rd undivided interest of the said poultry and tubes manufacturing
business and Appellant No.2 had the remaining 1/3rd share. The joint family
and Respondent No.3 herein had no interest in the said business concern.
5. Allegedly, a notice dated 27.08.1985 was served asking the appellants http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 6
herein to render accounts in respect of the said businesses, but no reply
thereto was given. A suit was thereafter filed on 12.09.1985. The father of
the Plaintiffs-Respondents Nos.1 and 2, namely, Respondent No.3 herein in
his written statement for all intent and purport supported the case of the
plaintiffs alleging that there had been no settlement of accounts in respect of
the said businesses and after the death of Narasimha Murthy, he was entitled
to the share to which his father was entitled to from the said business. It was
alleged that further amounts were also advanced after the death of his father
by way of advance as well as interest accrued on principal amounts
advanced. It was further alleged that the infrastructures and the buildings
referred to in Schedule ’B’ appended to the plaint including the residential
house bearing D. No. 7/26 were constructed with the profit earned from the
business. It was, therefore, contended that they were entitled to 2/3rd share
in the business besides the amounts advanced together with interest at the
rate of 15% p.a. and also to a half share in the properties described in
Schedule ’B’ appended to the plaint together with income thereof.
6. With his written statement, Defendant No.1 filed a document as an
annexure thereof showing that a sum of Rs.1,55,535.00 had been advanced
during the period 23.08.1968 to 29.05.1971.
7. In her written statement, Defendant No. 3 (Appellant No. 2 herein)
accepted that during the life time of late Narasimha Murthy, Defendant No.
1 partitioned the joint family properties under a registered deed of partition
of the year 1961. But according to him, only landed properties were
partitioned keeping the family house and vacant sites at Pulagurtha joint.
The allegation to the effect that Appellants herein approached the Defendant
No.1 and late Narasimha Murthy for investment of money in the poultry
business or that they invested any amount on the premise that the profits
arising out of the said business can be shared by late Narasimha Murthy and
Defendant No. 1 and the Defendant No.2 equally after giving due credit to
the expenditure and interest to investments made at 15% p.a. was denied.
The other allegations made in the plaint were also disputed. A plea that the
suit was barred by limitation was also taken.
8. There is no document to show that any partnership came into being by
and between the parties and/or their predecessors in interest.
9. It is, however, not in dispute that after the suit was filed, an Advocate
Commissioner was appointed for making an inventory of the poultry farm.
It was stated that late Narasimha Murthy merely advanced a sum of Rs.
5,000/- and as a good gesture of goodwill, his name was included as one of
the vendees along with Defendant No. 2 in the purchase of the property by
reason of the said deed of sale dated 02.12.1970. According to Appellants,
Narasimha Murthy had never shown any interest in the said property as a
result whereof the business became exclusively theirs and the same was
accepted by late Narasimha Murthy. Even if the said allegations are correct,
Narasimha Murthy would only have = share in the land covered by the said
sale deed.
10. M/s Anasuya Poultry Farm or M/s Anasuya Plastics were the business
concerns started by the Defendant No.2 (Appellant No. 1 herein) with her
own money and late Narasimha Murthy or Respondent No.3 had no interest
therein. It was furthermore contended that for carrying out the poultry
business, a shed had been constructed by Defendant No.2 by obtaining loans
from the State Bank of India and neither Narasimha Murthy nor the
Defendant No.1 even objected thereto. The business, therefore, was a
proprietary concern of the Appellant No.1 herein. Although separate written
statements were filed by the Defendant No.4 and Defendant Nos. 5 to 7, it
may not be necessary to consider the same. Defendant No. 4 in her written
statement relinquished her share.
11. A large number of issues were framed by the learned Trial Judge. The
learned Trial Judge by reason of his judgment dated 23.04.1993 passed a
preliminary decree directing partition of the properties described in Schedule http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 6
’A’ appended to the plaint into three equal shares by metes and bounds and
allotted two shares to the plaintiffs and furthermore directed partition of the
properties described in Schedule ’B’ appended to the plaint into nine equal
shares by metes and bounds and allotted four shares to the plaintiffs.
Appellant Nos. 1 and 2 herein as also Respondent No. 3 herein were also
directed to render fair and proper accounts in respect of poultry business
from 1968 onwards.
12. Appellants herein (Defendant Nos. 2, 3, 5 to 7) preferred an appeal
thereagainst before the High Court, which has been dismissed by reason of
the impugned judgment.
13. The High Court having regard to the contentions raised by parties
formulated the following questions for its consideration :
1. Whether the poultry business carried on by the
appellants is a joint venture?
2. Whether there was a settlement of account under
Ex. B8?
3. Whether the respondents are entitled to the share
of defendant No. 47?; and
4. Whether the suit is barred by limitation."
14. Mr. A. Subba Rao, the learned counsel appearing on behalf of the
appellants, would submit that the learned Trial Judge as also the High Court
committed a serious error insofar as they failed to take into consideration the
effect of Ex.B-8, which categorically goes to show that the accounts had
been settled by and between the parties on 30.05.1979. The learned counsel
urged that it may be true that no averment was made in the written statement
in regard to the said document, but in view of the fact that Defendant No. 1
(Respondent No. 3 herein) having admitted the execution thereof, the same
should have been taken into consideration for the purpose of determining the
issue of limitation, if not for other purposes.
15. The learned counsel would submit that the High Court has also not
bestowed any consideration in respect of the execution of deed of
partnership dated 06.03.1978 entered into by and between the appellants
with her daughter wherein Defendant No.1 (Respondent No.3) is a witness.
16. In any event, the learned counsel argued, there is nothing on record to
show as to how the High Court came to a conclusion that the plaintiffs and
Defendant No.1 had 2/3rd share in the business venture. The learned counsel
submitted that the fact that Defendant No.1 (Respondent No.3) was himself
an Engineering Graduate, there was absolutely no reason as to why he had
not asked for an account annually and having regard to the fact that the
partnership was allegedly entered into in the year 1978, the suit was ex facie
barred by limitation.
17. Mr. T.L.V. Viswanatha Iyer, the learned counsel appearing on behalf
of the plaintiffs (Respondent Nos. 1 and 2), on the other hand, submitted that
although the question in regard to the extent of share had been raised before
the learned Trial Judge, the same was not done before the High Court and,
thus, the same should not be permitted to be raised before us. According to
the learned counsSel as the appellants herein were not in a position to make
any investment and a total sum of Rs.1,55,535/- was advanced by Defendant
No.1, towards the joint venture, a suit for rendition of accounts was
maintainable. The judgment of the trial court, according to the learned
counsel, was unassailable, in regard to the question of limitation. The
learned counsel would contend that Ex.B-8 upon which reliance has been
placed, does not contain any signature of any party nor any amount has been
paid pursuant thereto in full and final settlement of the accounts wherefor http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 6
the same was drawn up. It was pointed out that Defendant No. 1 was only a
manager of the Hindu undivided family and the business concerns were
being run the appellants herein. In view of the fact that profits were being
reinvested into the partnership business, it is idle to contend that the
accounts were settled particularly when the business was found to be a
running one by the learned Trial Judge. Even the notice issued by the
plaintiffs, it was pointed out, had not been replied by the defendants. The
learned counsel would contend that Article 5 of the Limitation Act, 1963
would not be applicable in a case of this nature as the same refers to a
dissolution of partnership and as in this case, the provisions of the Indian
Partnership Act, 1932 are not attracted, only Article 113 thereof would
apply.
18. Dr. K.P. Kaylash Nath Pillai, the learned counsel appearing on behalf
of Defendant No. 1 (Respondent No.3), would submit that the question as to
whether the business was a joint venture or not being a question of fact, this
Court should not exercise its discretionary jurisdiction under Article 136 of
the Constitution of India.
19. So far as issue No. 1 is concerned, we are satisfied that the business
was a joint venture and not the sole proprietary concern of the Appellant No.
1, as urged by Mr. Subba Rao.
20. We may furthermore notice that a concession was made before the
High Court that so far as the immovable property is concerned, having
regard to the provisions contained in Section 45 of the Transfer of Property
Act, 1894, Narasimha Murthy had = share therein. It is, thus, not necessary
for us to go into the said question as correctness or otherwise of the said
concession is not in question before us.
21. However, it is difficult for us to accept the reasonings of the High
Court in regard to Ex. B-8. Plaintiffs (Respondent Nos. 1 and 2) were
claiming the property as members of the Hindu undivided family.
Admittedly, the interest of the Hindu undivided family was being looked
after by Narasimha Murthy and after his death by Defendant No.1
(Respondent No.3). Correspondences were exchanged by and between
Appellant Nos. 1 and 2 only with Narasimha Murthy and Defendant No. 1
(Respondent No.3). Yet again admittedly, Defendant No. 1 (Respondent
No.3) was the manager of the Hindu undivided family. His dealing with the
appellant in regard to the affairs of the business will have a direct bearing in
the matter of determination of the issues raised before us.
22. An admission made by a party can be used against him. When such
admission is made by a Karta of the Hindu undivided family, who is
managing the family property as well as family business affairs, the same
would be a relevant fact. When a claim was made by the plaintiffs for
rendition of accounts in the lis, issuance of a document purported to have
been authored by one of the parties, in our opinion, was required to be taken
into consideration.
23. In terms of Section 58 of the Indian Evidence Act, 1872, a thing
admitted need not be proved. [See Shreedhar Govind Kamerkar v.
Yesahwant Govind Kamerkar & Anr. \026 2006 (14) SCALE 174]
24. It is also a trite law that when in cross-examination a witness accepts
the correctness of a document, the same would be relevant. A pleading in
regard to existence of a document may be necessary for advancing the case
of a party, but when a witness admits a document to be in his own
handwriting without anything more, the effect thereof may have to be
considered having regard to the provisions contained in Section 145 of the
Indian Evidence Act in terms whereof the only requirement would be that
his attention is drawn before a writing can be proved. These relevant facts
have not been considered by the High Court. The High Court merely
proceeded on the basis that Ex. B-8 did not contain anybody’s signature. If
the Defendant No. 1 accepted the contents of the said document, which,
according to him, were noted by him from the books of accounts, http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 6
authenticity thereof is not in question, and, thus, even in absence of books
of accounts, relevant pages whereof were found to have been torn, the High
Court ought to have taken the same into consideration as well as the
admission on the part of the Defendant No. 1 and the effect thereof. Such an
admission could be taken into consideration both for the purpose of arriving
at a finding in regard to the fact as to whether a full and final settlement of
accounts had been arrived at, which was a relevant fact as also for
determining the question of limitation.
25. There is no document in writing to prove partnership. Accounts had
not been demanded by the plaintiffs or the defendant no. 3 for a long time.
Even an oral partnership had not been proved. What was the subject-matter
of the partnership had also not been considered by the High Court. A share
in a joint venture, in absence of any document in writing, must be
determined having regard to the conduct of the parties. The High Court
proceeded on the basis that the plaintiffs and defendant No.1 had = share in
the property in terms of Section 45 of the Transfer of Property Act. If the
said immovable property formed assets of the joint venture, the same would
be an indicia to determine the shares held by the parties thereto. Ordinarily,
the extent of an involvement made shall be the criteria for determining the
share of the co-entrepreneurs. In absence of terms and conditions of the
joint venture having not been reduced to writing, conduct of the parties how
they dealt with affairs of the business would be relevant.
26. The High Court does not say that the concession made by the learned
counsel appearing on behalf of Appellants was incorrect. In a situation of
this nature, particularly when the limitation issue required determination, Ex.
B-8, in our opinion, should have received serious consideration at the hands
of the courts below.
27. In terms of Section 3 of the Limitation Act, it is for the court to
determine the question as to whether the suit is barred by limitation or not
irrespective of the fact that as to whether such a plea has been raised by the
parties. Such a jurisdictional fact need not, thus, be pleaded. In any event,
the said evidence was admissible for the purpose of contradicting a witness,
which being a relevant fact should have been considered in its proper
perspective. If the contents of Ex. B-8 were accepted, it was not for the
High Court to consider the consequences flowing therefrom, and, thus, but
the fact whether the figure(s) contained therein could be verified from the
books of account might not be very relevant. Whether, it would be in
consonance with the pleadings of Appellants was again of not much
significance if it can be used for demolishing the case of Plaintiffs and
Defendant No.1 If the figures contained in Ex. B-8 were accepted, it was for
Defendant No. 1 to explain the same and not for Appellants. The High
Court, in our opinion, thus, committed a manifest error in not taking into
consideration the contents of Ex. B-8 in its proper perspective.
28. At the cost of repetition, we may state that the effect of the said
document at least should have received serious consideration at the hands of
the High Court. We cannot accept the contention of Mr. Iyer that such a
question had not been raised. From the impugned judgment of the High
Court, it appears that the said such question had specifically been raised. The
High Court noticed the arguments of the learned Advocate in the following
terms :
"\005Therefore, they have no objection for giving the half
share in the property in spire of 1st respondent expressing
his intention to relinquish his right in the half share of
landed property admeasuring Ac. 7-14 guntas in Atapur
covered by Ex. B-15. After the settlement of accounts
under Ex. B-8 the appellants obtained loans from various
banks for the purpose of reviving the poultry business
and also setting up of business in plastics. In all the loan
transactions, the 1st respondent signed the loan
documents as a guarantor. If really he is interested in the
business, he would have been one of the principal debtors http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 6
and not a guarantor. That indicates that the respondents
have no interest in the poultry business carried on by the
1st appellant. Further the 1st respondent got himself
examined on commission as he does not want to face the
Court since his case is false.
As regards the share of the 4th defendant who is the
daughter of late Narasimha Murthy is concerned, the
respondents are not entitled to her share as relinquishment
of her share in the property is not evidenced by any
document except Ex.B9 which is not a registered
document. Therefore, the respondents cannot claim the
share of the 4th respondent. Since neither late Narasimha
Murthy nor respondent No. 1 obstructed the 1st appellant
from carrying on the business in the half share of Ac.7.14
guntas of land, the appellants are not liable to account for
profits earned by them by their own labour. If really the
case of the respondents is that the poultry business carried
on by the appellants is not the exclusive business of the 1st
appellant, at the time of Ex. B8 they would have demanded
for accounting of the profits. As regards the building
constructed in the site, it is constructed with the money
belonging to the 1st appellant and therefore, the
respondents are not entitled for a share in the said building.
At the most the value of the site on which the building is
constructed may be awarded to the member of the joint
family on which the corners constructs a building. The
suit for accounts is barred by limitation as the business was
closed in 1973. At the most the respondents are entitled
for profits 3 years prior to the filing of the suit\005"
29. It was for the High Court to frame appropriate points for its
determination in the light of the submissions made on behalf of Appellants
in terms of Order 41 Rule 31 of the Code of Civil Procedure. The High
Court failed to address itself on the said issue. Thus, apart from Issues Nos.
2 and 4, other points which for its consideration including the extent of the
share of Plaintiffs and Defendant No. 1 were required to be specifically gone
into particularly in view of the fact that such a contention had been
considered by the learned Trial Judge. Issue Nos. 2 and 4, in our opinion,
therefore, require fresh consideration at the hands of the High Court.
30. For the aforementioned purpose, it may also be necessary for the High
Court to consider the applicability of the relevant articles of the Limitation
Act. We, therefore, are of the opinion that the impugned judgment to the
extent aforementioned cannot be sustained. It is set aside accordingly in part
and the matter is remitted to the High Court for consideration of the matter
afresh on the said issues, inter alia, in the light of the observations made
hereinbefore. The High Court shall also formulate appropriate points for its
consideration in terms of Order 41 Rule 31 of the Code of Civil Procedure
and proceed to hear the appeal on merits on the relevant issues apart from
Issue Nos.2 and 4. This appeal is allowed to the aforementioned extent. In
the peculiar facts and circumstances of the case, there shall be no order as to
costs.
