MOHD. LAIQUIDDIN AND ANR. versus KAMALA DEVI MISRA (DEAD) BY LRS. AND ORS.

Citation: [2010] 1 S.C.R. 873 · Decided: 05-01-2010 · Supreme Court of India · Bench: TARUN CHATTERJEE · Disposal: Dismissed

Cited by 1 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

[2010] 1 S.C.R. 873 
MOHD. LAIQUIDDIN AND ANR. 
v. 
KAMALA DEVI MISRA (DEAD) BY LRS. AND ORS. 
(Civil Appeal Nos. 6933-34 of 2002) 
JANUARY 5, 2010 
[TARUN CHATTERJEE AND V.S. SIRPURKAR, JJ.] 
Indian Partnership Act, 1932: 
A 
B 
ss.42 and 4 - Deemed dissolution of firm - Two partner5 c 
- Death of one partner - LRs of deceased partner not 
interested in continuing the firm or in constituting a fresh firm 
- Effect of - Held: Since there were only two partners 
constituting the partnership firm, on death of one of them, 
there was deemed dissolution of the firm, despite existence 
D 
of a clause in the partnership deed which said otherwise - A 
partnership is a contract between partners - There cannot be 
any contract unilaterally without acceptance by the other 
partner - LRs of the deceased partner could not be asked to 
continue the partnership, as there was no legal obligation upon 
E 
them to do so, as partnership is not a matter of heritable status 
but purely one of contract, which is also clear from definition 
of partnership under s.4. 
ss. 14 and 48 - Property of firm - Partnership firm, 
constituted for construction of a cinema theatre, consisted of F 
two partners - While the first partner offered her land for 
construction of cinema theatre, the second partner 
constructed cinema theatre and other allied constructions by 
procuring funds - Deemed dissolution of the firm in view of 
death of the first partner - Distribution of residual property G 
amongst the partners - Held: On facts, there was no intention 
from either partner to treat the land, building, structures etc. 
as properties of the firm - As the partnership got dissolved 
on death of a partner, it would be reasonable to allow both the 
873 
H 
874 
SUPREME COURT REPORTS 
(2010) 1 S.C.R. 
A parties to take their respective properties - First partner 
entitled to exclusive possession of the land while second 
partner entitled to take away the movables and recover the 
value of buildings and structure embedded to the land. 
8 
Appeal - Second appeal - New plea - Question of law, 
based on pleadings and evidence on record, not raised before 
lower courts - Held: Such question of law can be permitted 
for the first time before the High Court. 
Constitution of India, 1950 - Article 136 - Powers under 
C - Not to be exercised, until grave injustice is shown to be 
caused to the aggrieved party by way of the impugned order. 
The partnership firm in question, constituted for 
construction of a cinema theatre, consisted of two 
0 partners. One of the partners filed suit for dissolution of 
the partnership firm alleging that the other partner 
mismanaged the business of the firm, manipulated the 
account books and stopped payment of the minimum 
guarantee profit, as envisaged under the partnership 
E deed, to the plaintiff-partner. 
In terms of the partnership deed, the plalntlff-partner 
offered her land for construction of the cinema theatre, 
while the defendant-partner constructed the cinema 
theatre and other allied constructions by procuring 
F necessary funds. 
During pendency of the suit, the plaintiff-partner died 
and her legal representatives, i.e. the appellants, were 
brought on record. The trial court held that there was 
G deemed dissolution of the partnership firm due to death 
of the plaintiff-partner, and since the appellants were not 
agreeable to enter into partnership with the defendant-
partner, they were entitled for rendition of accounts and 
to be handed over the entire cinema theatre with allied 
H structures as per the deed of partnership. Meanwhile the 
MOHD. LAIQUIDDIN AND ANR. v. KAMALA DEVI 
875 
MISRA (DEAD) BY LRS. 
defendant-partner 
also 
died, 
and 
his 
legal .A 
representatives, i.e. the rospondents were brought on ' 
record before the First App~llate Court, which confirmed 
the decree passed by the trial court. 
The respondents filec:t appeal before the High Court, 
8 
which also held that the partnership firm stood dissolved 
on account of death of ono of the partners, but permitted 
the respondents to take away the movables from the 
cinema theatre and recovor the value of the byllding and 
structures embedded to tho land. On a combined reading 
of the terms of the partnership deed, the High Court held C 
that the land and the cinema were not the properties of 
the firm but were propertioa of the respective pnrties, and 
thus the appellants were ontitled to exclusive possession 
of. the land and the respondents w

Excerpt shown. Read the full judgment & AI analysis in Lexace.